MEDLOW & MEDLOW

[2015] FamCA 1183

FAMILY COURT OF AUSTRALIA

MEDLOW & MEDLOW [2015] FamCA 1183

FAMILY LAW – PROPERTY – Interim – Where previous interim property orders had been appealed to the Full Court and judgment reserved – Where the issues in the appeal are similar to those in the present Application – Where the applicant husband seeks orders that he receive certain moneys including a sum of $180 000 to meet living costs –Where it would be undesirable that there be a further interlocutory hearing until the outcome of the appeal is known – Orders made to adjourn the proceedings.

Family Law Act 1975 (Cth) s 79

Harris & Harris (1993) FLC 92-378

APPLICANT: Mr Medlow

RESPONDENT: Ms Medlow

FILE NUMBER: SYC 7742 of 2010

DATE DELIVERED: 16 December 2015

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Loughnan J

HEARING DATE: 16 December 2015

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Gould

SOLICITOR FOR THE APPLICANT: Watts McCray Lawyers

COUNSEL FOR THE RESPONDENT: Mr Richardson SC

SOLICITOR FOR THE RESPONDENT: Barkus Doolan

Orders

1. The proceedings in relation to the husband’s Application filed on 8 December 2015 are adjourned to 10.00 am on 16 February 2016.

1. Any Amended Response and any affidavit on which the wife seeks to rely be filed and served by the close of business on 11 February 2016 unless the parties otherwise agree in writing.

1. The Application of the wife filed 29 September 2015 for the husband to be dealt with for contempt of court is to be listed for hearing of one day on a date convenient to the parties, after 16 February 2016 being a date settled by the Registry.

1. The 1 February 2016 listing of the Application filed on 29 September 2015 is vacated.

1. The question of costs of and incidental to the proceedings today is reserved.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Medlow & Medlow has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER:  SYC7742 of 2010

Mr Medlow

Applicant

And

Ms Medlow

Respondent

REASONS FOR JUDGMENT

1. The argument today has become one of relatively narrow compass, but the issues arise in fairly complicated circumstances.  I made decisions in July and September of 2014 in relation to interim financial relief in the context of proceedings for settlement of property.  Each of those decisions is the subject of an appeal.  The appeals were heard in June 2015.  I understand that some further evidence was adduced after the hearing of the appeal.  The Full Court is still reserved.  Inquiries by my chambers revealed that judgment may be given around mid-February 2016. 

2. An Application was filed by the husband on 8 December 2015 seeking a raft of orders, including orders of a similar type to the orders made by me in July of last year, but there are also other orders, orders vacating or discharging longstanding orders for spousal maintenance and adult child maintenance, orders in relation to the investment of funds and orders for an updated valuation of some assets. 

3. That Application was listed on short notice.  There is a very voluminous affidavit by the husband, by way of annexures at least, dealing with the source of funds and evidence about aspects of his need for funds.

4. The background evidence is that the husband has been charged with a most serious criminal offence and a trial of some 60 days estimated duration to be held in the middle of next year.  There is other litigation that is referred to in previous judgments as the G litigation between the husband and members of the G family or their connections. 

5. It is recognised by the parties that because the issues arising in the application of 8 December 2015 are similar to the issues dealt with in the appeal, it is undesirable that there be a further interlocutory hearing until the outcome of the appeal is known.  That is the position of the respondent wife before me and it is a position flagged by the husband in an affidavit he filed in the Full Court proceedings earlier this year. 

6. There has been some discussion about convenient dates and 16 and 22 February 2016 were identified as dates that might be otherwise suitable.  That is about the time when, as far as can be predicted, judgment might be given in the  appeals  That time frame also makes some sense of the evidence given by the husband in these proceedings, in relation to his need for funds for legal fees in the criminal proceedings.  There is evidence that those fees need to be paid on account at least two months before the commencement of the criminal trial. 

7. There is a recent letter from one of the senior counsel representing the husband in the criminal proceedings that he would want payment to be secured by 11 March 2016.  He indicates that to be a date by which it would not be too late for the husband to then secure alternate counsel if the satisfactory arrangements could not be made for the counsel in question.  I understand the position to be that although not thrilled about it, the husband does not want to be heard to argue strongly against an adjournment to one of the dates referred to.  It is also accepted on his behalf that although there has been correspondence between the parties, there is a very voluminous affidavit by him and there has been effectively no time for the wife to address it.  The wife lives outside the jurisdiction in Europe and that adds to the reasons why it may be seen as unfair for the interim matter to be pressed today or in the time available this sitting year.

8. However, the husband presses today to receive some amount of out of funds invested, being the proceeds of the sale of a property.  That is sought to address the pressing need he identifies, not just for his legal fees but for legal costs in these proceedings, his living costs, wages that he says are necessary to be paid to his son, and other outgoings.  That Application is also opposed.  The husband’s claim is said to be of the order of $180,000.  I am not quite sure how that amount is calculated.  I think there is an assertion that that would represent the after tax benefit to one of the parties from an equal division of the interest on the invested fund that stands at about $27 million.

9. This claim is opposed on the same basis that the substantive interim relief is opposed.  The husband contends that there is a safe margin in terms of the authorities such as Harris & Harris (1993) FLC 92-378 for interim relief to him, without jeopardising the wife’s legitimate claims in the property settlement proceedings. The wife contends that there is no such margin. The husband suggests that the available property pool might be found to be less than $50 million and the wife contends that the pool she earlier identified at $111 million is really of the order of $113 million. That was her contention before the Full Court, based in large part, as I understand her case, on figures that represent the value of assets at an earlier date. She contends that she will ultimately be able to satisfy the court about those matters in the substantive property settlement proceedings.

10. I agree with the position that the parties have come to.  It is very difficult, it seems to me, to hear a further application for interim property settlement when there will soon be a decision from the Full Court as to the correctness of the similar decisions made last year.  There is no margin for compromise.  I cannot be confident on the argument that the wife puts that she will not be able to make a case in relation to the pool of assets.  I rejected her arguments in July and September 2014 and that is the very subject of the appeal proceedings.  There is a serious issue at stake and that is that the court on a final property settlement might be unable to make a proper award to her because of something done at an interlocutory stage and at a hearing where there could be no proper findings of fact. 

11. The parties are literally at war over these issues.  I was provided with redacted copies of communication between them from which I infer that some efforts have been made to achieve a compromise, if not of the substantive proceedings then as to significant parts of it.  Those efforts have been unsuccessful.  I have referred to the time frame of the husband’s need to secure his legal expenses in the criminal proceedings.  The husband has other expenses, as I have said.  He has provided some evidence that demands have been made today for payment in relation to his accommodation. 

12. As to the urgency of the husband’s need for funds, the submission on behalf of the wife is, that in October 2015 the husband identified that he had $2,000 left to his name.  His expenses run at, $10,000 or $15,000 a month.  The submission is that he has provided no satisfactory explanation as to the source of funds on which he has been living and from which he has met his expenses since that time.  There is a bare reference in the husband’s case to inquiries of a lender of last resort.  Again, there is no evidence on the basis of which I can make a finding that those inquiries have been exhausted or that those inquiries were necessary.  I am simply not in a position to make those findings. 

13. The problem is insoluble.  The court cannot make findings on a disputed issue of fact on a hearing on the papers, unless there is the common ground evidence or independent material that excludes one version of events or wholly supports another.  I do not have such evidence  The parties’ affairs are complicated, it is trite to say, and there is just no possibility of finding that the husband has exhausted all possible sources of financial relief.  In that regard there are the questions identified by the wife’s counsel.  Again, there are the issues before the Full Court.  Whatever I might think about this, there is a question about the scope for priority to be given to necessity over the need to preserve a pool of assets in order to make a proper distribution of property.  Interesting from the lawyers’ point of view.  The Full Court has taken some time over the appeal and it is agreed that there is a significant issue to be tried. 

14. There is no reason to infer that the appeal is without merit.  With all of those limitations and restrictions, I am simply not in a position to make an order for a further distribution of controversial funds.

15. I will adjourn these proceedings in relation to the husband’s application filed 8 December 2015 to my list at 10 am on 16 February 2016. 

16. There is an Application in relation to updating the valuation.  The valuation cannot be necessary for the husband’s interim application, because he was going to run that today.  I gather that the updating of the valuation of real estate in Western Sydney is to do with something else.  The husband is free to have the valuation updated.  However, the need for a single expert to update a valuation must relate to the substantive proceedings and the parties are nowhere near ready for a final hearing.  An updated valuation would be a waste of resources at this time.  There is also an argument made on behalf of the wife that the valuer might not be in a position to provide probative assistance because there is an issue about rezoning, which is probably beyond the expert’s skill.  I will leave that for another day, but I will make no order about an updating valuation. 

I certify that the preceding sixteen (16) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan delivered on 16 December 2015.

Associate: 

Date:  8 January 2016