McElvery and McElvery (No 2)

[2009] FamCA 1269

FAMILY COURT OF AUSTRALIA

MCELVERY & MCELVERY (NO. 2) [2009] FamCA 1269

FAMILY LAW – PROPERTY – Disclosure – Payment of money

APPLICANT: Mr McElvery

RESPONDENT: Ms McElvery

FILE NUMBER: BRC 5385 of 2007

DATE DELIVERED: 18 December 2009

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Murphy J

HEARING DATE: 18 December 2009

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Ms Toomey, of Schultz Toomey O’Brien Lawyers

FOR THE RESPONDENT: The respondent appeared in person

Orders

1. This matter be transferred to the Federal Magistrates Court at Brisbane, and it is respectfully requested that the court give consideration to the appointment of a directions hearing and/or final hearing dates at the earliest opportunity so as to permit this matter to proceed to a final hearing at the earliest possible date.

2. That from the amount standing to the credit of the parties jointly in the account styled MD Trust Account there be paid forthwith to each of the parties the sum of $35,000, with such sum to be used be each party as each thinks fit.

3. The manner in which the said sums should treated within the process contemplated by section 79 of the Act be determined by the trial Federal Magistrate.

4. The parties shall each account for the expenditure of the said $35,000 at the final hearing of this matter.

5. The parties shall do all such things as are necessary to complete the disclosure process foreshadowed by directions made by me on 15 October 2009, and in the event that the disclosure process is alleged by one party or the other to be deficient, that be a matter for determination by the trial Federal Magistrate.

IT IS DIRECTED THAT

1. The real properties disclosed in the husband’s financial statement filed in these proceedings be valued by W Agency and

   (a)that firm be a single expert within the meaning of the Family Law Rules 2004; and

   (b)the costs of such valuation be borne equally by the parties and met from the funds standing to the credit of the parties in the MD Trust Account.

2. The wife be granted leave to issue subpoenae to the Westpac Banking Corporation and Permanent Custodians Limited and to the Westpac Banking Corporation in New Zealand.

3. The wife shall serve copies of the intended subpoenae addressed to B McElvery upon the solicitors for the wife.

4. The question of whether leave ought be granted to issue each of the subpoenae addressed to B McElvery is adjourned to the Federal Magistrates Court at the first mention of this matter.

IT IS NOTED that publication of this judgment under the pseudonym McElvery & McElvery is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT BRISANE

FILE NUMBER: BRC 5385 of 2007

MR MCELVERY

Applicant

And

MS MCELVERY

Respondent

REASONS FOR JUDGMENT

1. I will do my best to have this matter heard in early March 2010. This matter needs a determination more than anything else. 

2. I can’t, obviously, bind what the Federal Magistrates Court will do, but for the information of the parties, I shall, upon transfer of the matter, raise with the regional coordinating Federal Magistrate the complexities of the issues in the case and shall respectfully request the regional coordinating Federal Magistrate to provide the earliest possible hearing date in respect of it.

3. I will now provide some short reasons in respect of the transfer and the other orders, given that they were opposed. 

4. This matter has a tortuous history in the three years that the parties have been separated.  Most recently, a series of orders were made by this court during appearances by the parties before the court from about June 2008. 

5. In what might be described as orders made in judicial exasperation at the fact that these two parties do not seem to be able to resolve what should be a very simple issue in respect of disclosure, a series of very detailed orders were made by me.  Those orders can, perhaps, be seen as “spoon feeding” the parties as to what was required.

6. Those orders envisaged the compilation of various documents. The first of those documents was a document annexed to the orders themselves that was designed to effect an assertion and response in respect of disclosure. Secondly, I formulated for each of the parties a document which was designed to set out in tabular and short narrative form those matters required by section 79 of the Family Law Act and, in particular, to establish what might be described as a balance sheet of the assets and liabilities of the parties at the date of cohabitation, the date of separation and as at the date of the document in November 2009.

7. Each of the parties has completed those documents.  Notwithstanding the completion of the first document, there remains today a continuation of the heated, continuous, multi-faceted allegations and counter-allegations about disclosure or the lack of it. 

8. As but one example, the inspection of documents was scheduled to take place at the offices of Ms Toomey, who represents the husband.  Ms Toomey asserts that on that occasion the wife said that she (the wife) would not produce for inspection documents which she had with her that day unless and until the husband produced affidavits or sworn statements from members of the husband’s family and from a person who the wife alleges is the co-owner of an alleged catamaran, the existence of which is denied by the husband.  That assertion by Ms Toomey is, after questioning of the wife by me, denied by the wife.  In fact, the wife asserts that, contrary to the assertion of Ms Toomey, no such conversation occurred. 

9. This is but one example of what can be described as the tedious, long-winded, multi-faceted issues relating to disclosure in this case. 

10. The time has plainly arrived when this matter needs to be heard and determined. Whilst the court does not for one minute suggest that, for parties recovering from the breakdown of their relationship, any sum of money is necessarily insignificant, nevertheless the Family Law Rules and, indeed, the legislation itself makes it plain that proportionality must attend the conduct of proceedings in this court.

11. These proceedings have gone well beyond the stage where the issue of disclosure can be seen as proportional to the broader issues in dispute between the parties.  That is in no way, shape or form to suggest that the wife may not be completely correct about the husband’s failure to disclosure.  Nor is it to suggest that a decision has been made that the husband has failed to disclose.  Rather, the statement is reflective of the fact that any process, including the disclosure process, must be seen to be, as the rules plainly make clear, proportional to the remedy sought; the very significant expenditure of public moneys involved in the conducting of court proceedings and the s 81 mandate to finally determine the parties’ financial relationship.

12. Ms Toomey submits that this matter is likely to receive a far earlier final hearing in the Federal Magistrates Court.  The court notes that Jordan J will formally retire from this court on 31 December 2009 and, in contemplation of that retirement, has ceased hearing cases a short time ago.  Accordingly, the dearth of judicial resources available to this court is now made significantly worse by Jordan Js absence from this registry.

13. Accordingly, it will be appreciated that there is significant merit in the submission made by Ms Toomey that the case is likely to be heard much quicker in the Federal Magistrates Court.  As but one example, appreciating the fact that this court is not able to give or indicate the availability of Federal Magistrates to hear trials, it seems likely, anecdotally, that a trial may be able to be given to this matter in March or April next year.

14. In my docket, it is extremely unlikely that I could give this matter a hearing before approximately August of next year.  I gave as one example of the reason for that, the necessity for this court to hear Magellan matters, and I provided one example of that occurring in court today of a 14-year-old child significantly self-harming and I am told by a number of experts is at a very high risk of taking her own life.

15. In my court I make no apology for putting matters of that type ahead of matters with the type of the issues involved in this case.  Accordingly, it seems to me proper and appropriate, given the amount of money involved; the nature of the issues involved; the likelihood of a far faster final hearing (which is plainly required in the interests of both parties whether they can see it for themselves or not) and the likely future expenditure on legal fees of at least the husband, that this matter be heard and determined finally by the Federal Magistrates Court, and I will transfer it accordingly.

16. As part of the orders made by me on 15 October 2009, I ordered that, within 21 days of that date, the wife should file and serve an affidavit in support of an application seeking the payment to her, from funds otherwise invested in the joint names of the parties emanating from the sale of a real property, a sum in respect of her reasonable living expenses intending that the application would be heard today. 

17. The wife did so and lists in an affidavit filed by her those living expenses.  Also, the wife in that affidavit deposes to a number of liabilities which she asserts needs to be met from the funds standing to the credit of the parties in that trust account.

18. Ms Toomey advises that the husband has reached the point where he is no longer able to pay her fees for his representation.  He is desirous of continuing her services.  It seems to me that the wife should be afforded the same opportunity (although she has indicated to me today that she believes she can do as good a job as a solicitor and intends, as is obviously her right, to continue to conduct the matter on her own behalf).  However, in circumstances where the husband has been represented by Ms Toomey now for a considerable period of time, that, if at all possible, he ought to be afforded the opportunity to continue with her representation.

19. I should also say that in light of the statutory mandate pursuant to s 81 to bring the financial dealings of these parties to an end as soon as possibly can occur, and the issue of proportionality pregnant in the rules to which I have just referred, that it is undoubtedly of significant benefit to the court, and therefore to the administration of justice, that both parties are not self-represented, given the nature, breadth and long-standing nature of the disputes, assertions and counter-assertions between them.

20. I ought not make an order paying to each of the parties a sum from moneys standing to the joint credit of each of them in circumstances where those funds are central to the property dispute between them, except in circumstances where I’m tolerably satisfied on an interim basis that the funds can, as it were, be made “reversible” in the sense that that expression is used in cases such as Zschokke and Harris. 

21. In that respect, the husband asserts that the property of the parties, or either of them, for the purposes of s 79 - whilst it must include as a matter of law the properties held by him as at the date of hearing, including, it seems, real properties – is such that, nevertheless the contributions aspect of the s 79 process would mean, in effect, that the wife had made no contribution to those properties. Accordingly, Ms Toomey submits that, as it were, the approximately $285,000 standing in the trust account effectively represents the totality of property for distribution.

22. The wife asserts, and has asserted now for a considerable period of time, that one of the consequences of what she asserts to be the husband’s broad-based failure to disclose is that the assets available for distribution have been either significantly undervalued or are undisclosed and, accordingly, the husband’s financial position – including, in particular, his asset position – is significantly better than that which he would contend in his sworn financial statement.

23. Those differing assertions, however, need to be given appropriate light and shadow by reference to the specific orders sought by the wife in this case. 

24. Those orders are, for present purposes, contained in a document filed, pursuant to earlier directions by me, by forwarding same to my associate via email and is described as the “Amended Annexure 2.”  The proposed orders are found on the last page of that document. 

25. Included among the orders are, for example, orders that:

    The husband pay the wife’s mother half of what is owing to her regarding money lent by the wife’s parents (in 1987) to purchase [B] property.  Amount ordered is $100,000.

26. The application also includes, for example, an order that:

    The husband pays wife’s legal costs for Family Law Court solicitor and barrister from the point of commissioning to paying outstanding legal fees of approximately $24,700.  A total of approx $50,000.

27. Troublingly, one of the orders sought is also in these terms: 

    Once settlement is reached and agreed upon, both husband and wife will reserve the right to re-open the Family Law case if it is found that full disclosure has not been made by either party prior to the date of settlement.

28. Relevant for present purposes, the wife seeks the totality of the moneys currently standing to the credit of the parties jointly in the trust account earlier referred to. 

29. It will be appreciated, then, that a decision about the justice and equity of paying to each of the parties a sum which would leave in excess of $200,000 standing to the credit of the parties in that trust account, must embrace the claim by the wife that she is entitled to all of it.

30. However, in determining the justice and equity of the orders proposed, which are made on an interim basis in order to attempt to have the parties ready this matter for final hearing, such a claim must be balanced against the somewhat unusual relief sought by the wife in the other paragraphs of the application earlier referred to by me. 

31. Doing the best I can, in my view, the balance of the justice and equity of the case, bearing in mind the confusing and confused state of the evidence, now extending over a number of interim continuation-day appearances before me, is in favour of each of the parties being paid a modest sum.

32. I have assessed that sum to be $35,000.  In arriving at that sum, I note:

    (1)Such a sum should readily secure for the husband the capacity to be legally advised during the time when he makes full disclosure, as he is required to do, pursuant to the Family Law Rules, and in respect of which I have made very specific directions.

    (2)It will allow the husband to be legally represented at the trial which, in my view, will assist in the overall task of the court, which is a public one, and that is the doing of justice and equity between the parties.

    (3)The payment of each of those sums would entitle the wife, if she so chose, to obtain legal advice and/or accounting advice and/or accounting reports and the like.  It goes without saying that it is entirely a matter for the wife as to whether she avails herself of that opportunity or not.  She is, of course, absolutely entitled to represent herself and to prepare her own case in these proceedings.  But nevertheless the amount ordered would permit of her to make a different choice. 

    (4)Should she choose not to – and she has indicated to me today that she will not – then the weekly expenses asserted by her to be reasonable can readily be met from the amount ordered to be paid to her in what I anticipate will be the approximate three or four months until this matter is heard and determined at a final hearing.

33. Balancing all of those matters, point, in my view, in favour of permitting the payment to each of the parties earlier referred to. 

I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Murphy

Associate: 

Date:  24 December 2009