Mifsud and Mifsud
[2018] FamCA 1116
•21 December 2018
FAMILY COURT OF AUSTRALIA
| MIFSUD & MIFSUD | [2018] FamCA 1116 |
| FAMILY LAW – PROPERTY – Application for interim property distribution – Where the wife seeks an order that the husband transfer real estate to her – Where the husband seeks final property orders for that real estate to ultimately be transferred to the wife – Where the Court is unable to determine that it is in the interests of justice for a partial interim property distribution to be ordered – Application dismissed. |
| Family Law Act 1975 (Cth) ss. 79, 80(1)(h), 114 Family Law Rules 2004 (Cth), r. 1.04 |
| Davidson and Davidson (No 2) (1994) FLC 92-469 Felice v Felice [2011] FamCA 162 Gabel & Yardley (2008) FLC 93-386 In the Marriage of Farr (1976) FLC 90-133 Martin & Martin and Ors [2013] FamCA 222 Medlow & Medlow (2016) FLC 93-692 Philips & Samuels [2017] FamCA 125 Sresbodan & Sresbodan and Ors [2013] FamCA 480 Stanford v Stanford (2012) 247 CLR 108 Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466 Sully & Sully (No 2) [2016] FamCA 706 Wenz v Archer (2008) 40 FamLR 212 |
| APPLICANT: | Ms Mifsud |
| RESPONDENT: | Mr Mifsud |
| FILE NUMBER: | WOC | 1118 | of | 2015 |
| DATE DELIVERED: | 21 December 2018 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | McClelland J |
| HEARING DATE: | 12 December 2018 |
REPRESENTATION
| SOLICITOR FOR THE APPLICANT: | Hansons Lawyers |
| COUNSEL FOR THE RESPONDENT: | Ms Messner |
| SOLICITOR FOR THE RESPONDENT: | Acorn Lawyers |
Orders
The wife’s Application in a Case filed on 2 October 2018 be dismissed.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Mifsud & Mifsud has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: WOC 1118 of 2015
| Ms Mifsud |
Applicant
And
| Mr Mifsud |
Respondent
REASONS FOR JUDGMENT
Introduction
In this matter, the wife seeks an order, by way of interim property distribution, that the husband transfer a property located at B Street, Suburb C NSW … (“the Suburb C property”) into her name.
That application is made in circumstances where progression of the wife’s substantive application has been delayed as result of criminal proceedings brought against the husband in the District Court of New South Wales. Those criminal proceedings involve events that occurred during the course of the parties’ relationship. Accordingly, the proceedings in this Court have been delayed, as requiring the husband to respond to certain matters relevant to them could prejudice the hearing of his criminal charges.
The wife contends that, through various means, including retaining new legal representatives at a late stage of the proceedings, the husband has deliberately extended the time for the hearing of those criminal charges.
The wife further contends that, in circumstances where the husband’s Response filed on 5 February 2018, proposes that the Suburb C property be transferred to her, it is appropriate for interim orders to be made for that to occur.
Application
By way of Application in a Case filed on 2 October 2018, the wife seeks the following orders:
1. That this Application be short listed and that any Rules of the Court which would prevent the same be dispensed with.
2. That pending further order and by way of interim property settlement the husband do all acts and things and sign all documents necessary to transfer to the wife within 14 days of the submission to him of the appropriate documents all his right title and interest in and to the property situate at and known as [B Street, Suburb C] (being the whole of the property in folio identifier …).
3. That the husband pay the wife's costs of and incidental to this Application.
The husband opposes that application and seeks that the wife pay his costs associated with it on an indemnity basis.
The legal principles
Transfer of property
Although not expressly stated, the wife’s proposed order for the transfer of the Suburb C property enlivens consideration of the Court’s power under s 114 of the Family Law Act 1975 (Cth) (“the Act”) to make suchorder or grant such injunction as it considers proper in relation to thepropertyof the parties: Philips & Samuels [2017] FamCA 125 at [65].
In that regard, in Martin & Martin and Ors [2013] FamCA 222 at [15], Cronin J said:
Section 114 of the Family Law Act 1975 (Cth) (“the Act”) enables the Court to provide a discretionary remedy. The fundamental principle is that an order should only be made if it is proper.
The term “proper” has been found to mean “reasonable and just in [the] circumstances”: In the Marriage of Farr (1976) FLC 90-133 at 77,437.
In this matter, the determination of whether it is proper to make an order, in the nature of a mandatory injunction, requiring the husband to transfer to the wife his right title and interest in the Suburb C property is necessarily related to the issue of whether there should be a partial property distribution to the wife, at this interim stage of the proceedings.
Interim partial property distribution
In the case of parties to a marriage, the legislative foundation for an order for the partial distribution of property is ss 79 and 80(1)(h) of the Act. In combination, those provisions confer power upon the Court to make orders for an interim property distribution. Section 80 is not, in itself, a source of jurisdiction for the making of an interim order for the partial distribution of property. Rather, that section is an “enabling provision”, which provides various ways in which the general power set out in s 79 may be exercised in individual cases. In that respect, in Davidson and Davidson (No 2) (1994) FLC 92-469 at 80,874, the Full Court stated:
Section 80(1) is limited by its introductory words, namely that “The court, in exercising its powers under this Part, may do any or all of the following ...” That is, s. 80(1) is activated by the exercise by the court of some other of the powers in Part VIII.
It is clear that the power to make orders pursuant to s 79 of the Act can be exercised prior to final hearing, including through “a succession of orders until the power ... is exhausted” or until a final order dealing with all the known property of the parties is made: Gabel & Yardley (2008) FLC 93-386, cited in Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466 (“Strahan & Strahan”) at 85,640.
However, as noted by Thackray J in Strahan & Strahan at 85,656, that power is discretionary:
…it is important to note that s 80(1) is couched in the permissive. Hence, although the Court must give consideration to the matters set out in s 79(4) when hearing an application for an interim payment, it has no obligation to make an interim order. The Court “may” do so if it considers that it should in the exercise of its discretion. [Emphasis added].
In that decision, the Full Court held that there are two steps to considering an application for a partial property distribution, prior to final hearing. The first step is to resolve whether to exercise the Court’s power, in that regard, prior to final hearing. This is a “procedural step” which requires an analysis of whether the circumstances of the case trigger the Court’s power to invoke s 80(1)(h) of the Act to make an order for an interim property settlement. The second step involves the application of s 79 of the Act and, in particular, a consideration of whether an order for the partial distribution of property is appropriate, just and equitable, at the point in time when the order is made: Sully & Sully (No 2) [2016] FamCA 706 at [33] – [36].
In terms of the approach that should be taken to that first step, in Strahan & Strahan at 85,645, the Full Court said:
In relation to the first stage, in our view, when considering whether to exercise the power under s 79 and s 80(1)(h) of the Act to make an interim property order the “overarching consideration” is the interests of justice. It is not necessary to establish compelling circumstances. All that is required is that in the circumstances it is appropriate to exercise the power. In exercising the wide and unfettered discretion conferred by the power to make such an order, regard should be had to the fact that the usual order pursuant to s 79 is a once and for all order made after a final hearing.
However, in Stanford v Stanford (2012) 247 CLR 108 (“Stanford v Stanford”) at [40], the High Court held that a consideration of whether there should be an order for the adjustment of legal and equitable interests in matrimonial property should not be commenced with the assumption “that one or other party has the right to have the property of the parties divided between them” (see also Medlow & Medlow (2016) FLC 93-692 (“Medlow & Medlow”) at 81,089). That principle applies to an application for the partial distribution of property in interim proceedings, as much as it does to an application for the adjustment of property at the final hearing of a matter.
In other words, an applicant for an interim partial property distribution carries the onus of satisfying the Court as to why it is in the interests of justice for such an order to be made, rather than for there to be a “once and for all” order made at final hearing.
As noted, the second step identified in Strahan & Strahan involves the exercise of the Court’s power pursuant to s 79 of the Act. In turn, insofar as it is possible in interim proceedings, this step requires the Court:
a)To identify “the parties’ property and of their interests in it” (Medlow & Medlow at 81,088); and
b)To consider and apply the provisions of s 79 of the Act (Strahan & Strahan at 85,645–85,646).
In a similar context to the reference by the Full Court in Strahan & Strahan to the “usual order” under s 79 of the Act being a “once and for all order”, Thackray J said, at 85,657:
The Court must first identify circumstances that make it appropriate to give consideration to exercising its power to make an interim order. It is at this stage that the Court has regard to the policy consideration that it is generally in the interest of the parties and the Court for there to be only one exercise of the s 79 power.
It is also important to note the obligation of the parties and the Court to further the main purpose of the Family Law Rules 2004 (Cth), which is set out in rule 1.04, as follows:
Main purpose of Rules
The main purpose of these Rules is to ensure that each case is resolved in a just and timely manner at a cost to the parties and the court that is reasonable in the circumstances of the case. [Emphasis added].
Accordingly, unless satisfied that it is in the interests of justice, the Court should avoid hearing a multiplicity of interim applications that traverse matters that will ultimately be addressed in an orderly and considered manner at final hearing.
Consideration
The interests of justice
The following relevant facts are asserted in the wife’s Affidavit and Financial Statement:
a)The wife is 43 years of age and the husband is 48 years of age;
b)The parties were married in 2004, after living together for a period of approximately five years;
c)The parties separated on 25 June 2015;
d)There are three children of the parties’ relationship, who are currently aged 15, 13 and 11 years (“the children”). Shortly after the parties’ separation, the wife and the children relocated to live at the home of the maternal grandparents and have remained there since. The wife is not required to pay rent at those premises, although she contributes to household outgoings;
e)The children have not spent time with the husband since February 2017;
f)At separation, the husband was charged with 20 criminal offences, including sexual assault of the wife, using an offensive weapon with an intent to commit an indictable offence, various firearm offences and various domestic violence offences;
g)The husband was committed for trial in respect to certain of those criminal charges in 2017. As a result of the matter not being reached on that day, the trial was adjourned until later in 2017;
h)On 24 March 2017, the Federal Circuit Court vacated trial directions that had been made in this matter and adjourned the final hearing to 31 May 2018;
i)The matter was subsequently transferred to the Family Court of Australia and on 4 April 2018, it was placed in the list of cases awaiting the allocation of hearing dates. A final hearing date has not as yet been allocated;
j)The husband’s criminal trial in the District Court has been further adjourned and has now been re-listed for mid 2019;
k)It is agreed by the parties that, as a result of the commonality of factual assertions that will be made in these proceedings, it is inappropriate for this matter to be dealt with prior to the hearing of the husband’s criminal charges;
l)The wife is employed as a manager and earns a gross salary of $935 per week. In addition, the husband pays child support of $500 per week;
m)The wife identifies her average expenses as totalling $870 per week; and
n)Following the parties’ separation, the wife traded in a prestige motor vehicle and, utilising that credit, as well as funds borrowed from family and a friend, purchased another motor vehicle.
At paragraph 39 of her Affidavit, the wife states:
As it is now more than three years since the date of separation and there is presently no indication of when the present proceedings before this Court may be concluded I am seeking an interim property distribution in accordance with the Orders sought by the respondent in his Response previously filed.
It relevant that, in the final orders sought in his Response filed on 26 February 2016, the husband proposes that the Suburb C property be transferred to the wife. It can, therefore, reasonably be inferred that the wife will ultimately receive an amount at least equivalent to the value of the Suburb C property in the parties’ final property settlement. In those circumstances, it is unnecessary for there to be “any detailed inquiry as to the purpose for which the funds are to be used”: Felice v Felice [2011] FamCA 162 at [12].
Sufficient particulars must nonetheless be provided to enable the Court to:
a)Determine that the application is “genuine” (Strahan & Strahan at 85,657);
b)“[I]dentify the circumstances that make it appropriate to give consideration to exercising its power” (Strahan & Strahan at 85,657; Sresbodan & Sresbodan and Ors [2013] FamCA 480 at [34]); and
c)Sufficiently weigh the identified need “against the benefit of having only one exercise of a s 79A power” (Strahan & Strahan at 85,656, citing Riethmuller FM in Wenz v Archer (2008) 40 FamLR 212).
Unfortunately, in this case, other than to the limited extent that I refer, the wife has not presented evidence as to the basis upon which she seeks that the Suburb C property be transferred to her at this interim stage in the proceedings. Those reasons may be summarised as:
a)That the allocation of final hearing dates has been delayed as a result of, what she believes is, a deliberate attempt on the part of the husband to delay his criminal proceedings;
b)That the husband proffers that the wife receive the Suburb C property on a final basis; and
c)That the wife and the children are currently living with the maternal grandparents.
During the course of the hearing, I invited the parties’ legal representatives to make submissions as to whether it was reasonably open to the Court to infer that the delay in these proceedings is causing financial hardship to the wife. Counsel for the husband contended that, in circumstances where the wife’s Financial Statement indicates a surplus of income over expenditure, such an inference cannot reasonably be made without further evidence being presented to that effect. I accept that submission.
I further invited the parties’ legal representatives to make submissions as to whether it is reasonably open to the Court to infer that it is less than satisfactory for the wife and the children to live with the maternal grandparents. Counsel for the husband submitted that, in the absence of evidence regarding the accommodation arrangements at the home of the maternal grandparents and the mother’s intended use of the Suburb C property, the Court is unable to make that inference. I also accept that submission.
Accordingly, in the absence of evidence as to why the wife seeks the transfer of the Suburb C property to her at this interim stage, I am unable to determine that it is in the interests of justice for such an order to be made.
It is, therefore, unnecessary to determine whether it is just and equitable to make such an order, having regard to the matters referred to in s 79 of the Act. Nevertheless, for completeness, I will now address that issue.
The parties’ matrimonial property
As noted above, in Medlow and Medlow, the Full Court confirmed that the applicant for orders for the partial distribution of property carries the onus of satisfying the Court that, in the event of such orders being made, there would nonetheless remain, in the matrimonial property pool, sufficient assets for any necessary adjustment to be made at final hearing.
At paragraphs 24 to 26 of her Affidavit, the wife lists her understanding of the property held in the name of the husband, which includes four parcels of real estate, the value of which totals approximately $2,347,500. In his Financial Statement, the husband estimates that his assets are valued at $1,745,094 and his liabilities are valued at $60,435. The husband further asserts that the Suburb C property is valued at approximately $520,000. I, therefore, accept that it is likely that, at final hearing, there would be sufficient property for any adjustment to be made in respect to a transfer of the Suburb C property to the wife.
However, as stated, the wife has not presented evidence that enables the Court to make a determination as to whether it is just and equitable for an order to be made for the partial distribution of property, having regard to the provisions of ss 79(2) and 79(4) of the Act. As confirmed in Stanford v Stanford at [112]: “Under s 79(2) of the Act, a court shall not make a property settlement order unless satisfied that it is ‘just and equitable’ to do so”.
As a result of the absence of evidence in respect to the maters to which I have referred, I must dismiss the wife’s application.
I certify that the preceding thirty-four (34) paragraphs are a true copy of the reasons for judgment of the Honourable Deputy Chief Justice McClelland delivered on 21 December 2018.
Associate:
Date: 21 December 2018
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