MASTERS & MASTERS
[2011] FMCAfam 314
•8 February 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| MASTERS & MASTERS | [2011] FMCAfam 314 |
| FAMILY LAW – Enforcement and/or vacation of property orders – whether there was an agreement to vary orders – whether such agreement was in fact implemented even if such agreement exists – s.79A not established – costs. |
| Family Law Act 1975, ss.75, 79A, 106A, 117 |
| Applicant: | MR MASTERS |
| Respondent: | MS MASTERS |
| File Number: | SYC 5295 of 2008 |
| Judgment of: | Altobelli FM |
| Hearing date: | 8 February 2011 |
| Date of Last Submission: | 8 February 2011 |
| Delivered at: | Sydney |
| Delivered on: | 8 February 2011 |
REPRESENTATION
| Applicant: | Self-represented |
| Solicitors for the Respondent: | Marsdens Law Group |
ORDERS
The husband and the wife to forthwith do all acts and sign all documents necessary to sell the property at Property M NSW (the “M property”) and by way of consequential arrangements for the purpose of effecting the sale;
(a)The list price and the minimum sale price shall be as agreed between the parties and if there is no agreement the listing price and the minimum sale price shall be advised by a valuer nominated by the President of the Australian Property Institute of his nominee.
(b)The property shall be listed for sale by private treaty with a real estate agent as agreed between the parties and if there is no agreement the agent shall be nominated by the President of the Australian Property Institute of his nominee.
(c)If the property has not been sold within 3 months of the date of these orders the husband and the wife shall do all acts and sign all documents necessary to list the property for sale by auction and if there is no agreement as to the reserve sale price then the reserve sale price shall be determined by the President of the Australian Property Institute or his nominee.
(d)The wife’s solicitor or conveyancer shall have the primary carriage of the conveyancing for the sale of the Property.
Upon completion of the sale of the property the husband and the wife shall do all acts and sign all documents and give all instructions necessary to apply the proceeds of sale in the following order:
(a)To pay any council rates and water rates outstanding.
(b)To pay all real estate agents and legal costs, commissions and expenses of the sale and solicitors costs of the sale.
(c)To pay [omitted] Bank in discharge of mortgage registered number [omitted].
(d)To pay the balance as follows:
(i)$6,344 to the husband;
(ii)Half the remaining balance to the wife;
(iii)The balance to the husband.
In the event that either party fails, refuses or neglects to sign any document or give any necessary consent to give effect to these orders then a Registrar of the Federal Magistrates Court at Sydney is empowered pursuant to section 106A of the Family Law Act 1975 to sign any such document and give any such consent on behalf of the defaulting party.
The husband is to pay the wife’s costs as agreed, or failing agreement, as assessed.
IT IS NOTED that publication of this judgment under the pseudonym Masters & Masters is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYC 5295 of 2008
| MR MASTERS |
Applicant
And
| MS MASTERS |
Respondent
REASONS FOR JUDGMENT
Ex Tempore
In the matter of Masters & Masters, I heard this matter on
16 December 2009 and delivered judgment in March 2010. The orders that were made contemplated the wife in the first instance discharging the mortgage and paying out the husband so that she could retain the home.
The orders then contemplate that if she were not able to do so the husband would discharge the mortgage, pay out the wife and retain the home. The orders then contemplated that if neither of those contingencies could occur the property would be sold, the expenses and outgoings paid, the mortgage paid off and then there would be a split in accordance with the orders.
I assessed contribution at 70 per cent in favour of the husband, assessed the section 75(2) considerations in favour of the wife at 20 per cent and ultimately found that there should be a just and equitable split between the parties of 50/50, of course taking into account the assets and liabilities that they each had as well as their superannuation entitlements and the former matrimonial home at M.
At the time of the hearing it was agreed between the parties that the former matrimonial home had a value of $470,000 but what I described during the course of this hearing as perhaps the unspoken issue in this case – the elephant in the room, metaphorically speaking - is the belief by at least one of the parties that the property is worth substantially more.
In the wife’s Affidavit she annexes a selling agency agreement from [omitted] in which they advise that the property ought to be listed for sale at $579,000 and would sell between $540,000 and $560,000. I mention this because it may well be that one of the unarticulated motives of one or both of the parties is the expectation of greater profit to them as a result of a higher value. I am speculating about this.
In any event, the orders that I have made have not been carried out, as conceded by the parties. The wife’s application today is that I should simply enforce the orders, and specifically, that the orders should in effect be implemented as at paragraph 6, which provides for the property to be sold.
The husband’s application is that I should in effect vary the orders to give him the opportunity to purchase the wife out in accordance with paragraphs 4 and 5 of the orders.
Ms Youssef, who appears for the wife, says that the orders are very clear in their terms. It is conceded that the wife could not comply. She asserts that the husband has not in fact complied. She concedes that there were discussions between the parties, much of which is documented in the Affidavit evidence of both the husband and the wife which sets out the extensive discussions between them about buying each other out and the terms of that but, Ms Youssef submits, there is no evidence of a concluded agreement to deviate from the orders of the court.
In these circumstances, particularly having regard to the length of the delay, she submits the orders themselves contemplate what should happen, and that is that the property should be sold.
The husband represented himself in these proceedings. He asserts that there was an agreement between Ms Masters and himself relating to a payout, but even he concedes that the agreement was not embodied in consent orders that were actually signed by the parties. In fact, a term that he used in his submissions was “agreement by emails, but nothing officially”, and I think that actually closely describes what happened between the parties.
They may well have either come close or in fact reached an agreement but it was nothing official because no consent orders were signed. It is interesting that the email correspondence that Mr Masters referred me to clearly contemplates that any agreement would be embodied in consent orders, but that has not happened.
He concedes that the official opportunity that he had to buy her out has passed. He was confident of reaching the concluded agreement but that did not take place. Mr Masters concedes today that as at this very moment he does not have the finance approval that would enable him to pay out the wife in accordance with either the orders that I made or the agreement that he says was reached with her.
He says that he could probably find $20,000 but at his case at its very best he would have to find $27,000. He thinks that he would have a finance approval by April 2011, possibly even earlier, but concedes that as at today’s date he does not have the finance approval and would need more time.
The application to vary orders of this court can only be dealt with under section 79A(1) of the Family Law Act1975:
Setting aside of orders altering property interests
(1) Where, on application by a person affected by an order made by a court under section 79 in property settlement proceedings, the court is satisfied that:
(a) there has been a miscarriage of justice by reason of fraud, duress, suppression of evidence (including failure to disclose relevant information), the giving of false evidence or any other circumstance; or
(b) in the circumstances that have arisen since the order was made it is impracticable for the order to be carried out or impracticable for a part of the order to be carried out; or
(c) a person has defaulted in carrying out an obligation imposed on the person by the order and, in the circumstances that have arisen as a result of that default, it is just and equitable to vary the order or to set the order aside and make another order in substitution for the order; or
(d) in the circumstances that have arisen since the making of the order, being circumstances of an exceptional nature relating to the care, welfare and development of a child of the marriage, the child or, where the applicant has caring responsibility for the child (as defined in subsection (1AA)), the applicant, will suffer hardship if the court does not vary the order or set the order aside and make another order in substitution for the order; or
(e) a proceeds of crime order has been made covering property of the parties to the marriage or either of them, or a proceeds of crime order has been made against a party to the marriage;
the court may, in its discretion, vary the order or set the order aside and, if it considers appropriate, make another order under section 79 in substitution for the order so set aside.
Paragraph (a) of subsection (1) talks about a miscarriage of justice by reason of fraud, duress, suppression of evidence, etcetera. That does not apply.
Paragraph (b) talks about circumstances that have arisen since the order was made such as to make it impracticable for the order to be carried out. There is nothing on the evidence that would suggest that that applies in this case.
Paragraph (c) talks about a person having defaulted in an obligation and that as a result of that it becomes just and equitable to vary the order. In this case, both the husband and the wife have not been able to take advantage of the provisions given to them in the orders to buy each other out and in fact that remains the case today. So there are certainly no defaults that would justify varying the order.
Paragraph (d) talks about a change to circumstances of an exceptional nature relating to the children and there are no factors in this case that would fall within that paragraph.
In any event, section 79A gives discretion and on the facts of this case it is not a discretion that I would be prepared to exercise. Orders were made and they clearly contemplated certain things. The orders gave the opportunity to both the husband and the wife to buy each other out. That has not taken place.
In these circumstances, the orders already speak very, very clearly about what is to happen, and that is that the property is to be listed for sale. It is not appropriate to vary those orders except in this regard. At paragraph 7(d) of the orders it says:
To pay to the husband and the wife an amount that represents the alteration of property interests affected by these orders with leave to relist.
Now, paragraph (d) was put in to the orders because it was not clear to me whether the husband or the wife would in fact buy each other out, nor was it clear to me at precisely what price the property would be sold, and in those circumstances that paragraph gave the parties the opportunity to come back.
The parties have come back and it is time now to resolve the matter once and for all. I am going to clarify by way of implementing the orders paragraph (d) to specify what happens when the sale proceeds of the property are received. In the reasons for judgment I set out the net assets of the husband and the wife.
When one excludes the value of the former matrimonial home and the mortgages secured over the property, the net asset situation of the husband and the wife is as follows. The husband has superannuation of $31,925, a motor vehicle of $1,000 and a personal loan of $10,000, giving him net assets of $22,925.
The wife has superannuation of $37,269, a motor vehicle worth $10,000 and a personal loan at $18,000, giving her net assets of $29,269. These figures are, of course, all set out in my reasons for judgment. This means the difference in the net asset position between the wife and the husband is $6,344. That is in favour of the wife.
What is to occur now is that the home is to be sold, the mortgage is to be paid, the expenses of sale to be paid. The husband would then receive the first $6,344 being the difference between the net assets in the wife’s possession and those in the possession of the husband. Thereafter, the remainder would be split equally between the parties.
It is my intention to redraft paragraph 7(d) of the orders so that it reflects this and so that there is no need for the parties to come back to the Court. The other reason is that I do not know whether this property is going to sell for $470,000, but by specifying the order in this way there should be less likelihood for either the husband or the wife to come back before the Court.
The order for the sale of the property will be in accordance with order 6. I note that order 12 already provides for the appointment of a Registrar of the Court to sign documents pursuant to section 106A.
An application for costs is made by the wife following on from the reasons I have just given. Section 117(1) states the general proposition that each party should pay their own costs. Subsection (2A) makes it clear that in exercising the jurisdiction I have under subsection (2) to order costs that I should consider a number of circumstances.
In this case Ms Youssef urges on me that the husband was wholly unsuccessful in the proceedings. As I indicated in my oral reasons for judgment, the only basis on which the husband could have been successful is if he had established one of the grounds set out in section 79A. He has failed to do so and on that basis he has been wholly unsuccessful in the proceedings. A costs order is appropriate under the circumstances.
I certify that the preceding twenty-nine (29) paragraphs are a true copy of the reasons for judgment of Altobelli FM
Date: 12th April 2011
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