Millman & Millman
[2020] FamCA 1042
FAMILY COURT OF AUSTRALIA
| MILLMAN & MILLMAN AND ANOR | [2020] FamCA 1042 |
| FAMILY LAW – COSTS – Circumstances justifying an order – Where the wife seeks a lump sum payment by way of litigation funding or in the alternative a dollar for dollar order – Consideration of the financial circumstances of the parties – Where the husband has been able to pay his legal fees – Where despite his stated impecuniosity the husband has agreed to meet the mortgage liabilities, pay spousal maintenance to the wife and meet the children’s school fees – Where there is no explanation to the change in the financial circumstances of the husband which explain his ability to meet his obligations under the parties’ agreement – Where the wife is not in receipt of any income – Where there is a prima facie case that the wife has an entitlement under s 79 of the Family Law Act 1975 (Cth) – Where there is currently no level playing field as between the parties - Orders. |
| Family Law Act 1975 (Cth) ss 79, 80(1)(h), 117, 117(2) |
| G and T (2004) FLC 93-176 Klearchos & Klearchos and Ors [2015] FamCAFC 217 McLean & McLean [2003] FamCA 330 Strahan & Strahan (Interim Property Orders ) (2011) FLC 93-466 |
| APPLICANT: | Ms Millman |
| 1st RESPONDENT: | Mr Millman |
| 2nd RESPONDENT: | Mr Fazil |
| FILE NUMBER: | ADC | 30 | of | 2020 |
| DATE DELIVERED: | 8 December 2020 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | Adelaide |
| JUDGMENT OF: | Berman J |
| HEARING DATE: | 29 October 2019 and 4 November 2020 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Ms Lewis |
| SOLICITOR FOR THE APPLICANT: | Jacqui Ion Lawyers Pty Ltd |
| COUNSEL FOR THE 1ST RESPONDENT: | Ms Nelson QC with Mr Richards |
| SOLICITOR FOR THE 1ST RESPONDENT: | Angela Ferdinandy |
| COUNSEL FOR THE 2ND RESPONDENT: | Mr Bullock |
| SOLICITOR FOR THE 2ND RESPONDENT: | Douglas Hoskins Legal |
Upon noting that:
All school fees are paid up to the end of 2020.
The first respondent husband will do all things necessary to withdraw the Appeal filed 29 July 2020 (on the basis that there be no order as to costs) on the next business day following the date of these orders.
The first respondent husband is satisfied that he is able to meet the interim spousal maintenance payments as provided for in these orders pending final hearing.
It is Ordered
That the husband do pay or cause to be paid to the trust account of the wife’s solicitor the sum of FIFTY THOUSAND DOLLARS ($50,000) by way of litigation funding payable within thirty (30) days of the date of this order.
That if the lump sum payment is not paid THEN within seven (7) days after the payment by or on behalf of the husband of any money in payment of accounts rendered by his solicitors including in relation to expenses associated with the preparation of his case, the husband pay or cause to be paid the same amount of money to the solicitors for the wife.
That within twenty four (24) hours after the payment by or on behalf of the husband of any money referred to in paragraph (2) of these orders the husband cause to be given to the wife’s solicitors a memorandum stating the amount or amounts so paid to the solicitors.
That all money paid to the solicitors for the husband including on his behalf arising out of these orders shall be held in trust by the solicitor for the husband and not applied in payment until such time as the same amount has been paid by or on behalf of the husband to the solicitors for the wife.
In the event that the payment referred to in paragraph 4 of these orders is not made within seven (7) days thereafter the husband is to direct his solicitors to pay fifty (50) per cent of whatever is received and held by them in trust to the solicitors for the wife.
That the amounts paid pursuant to these orders to the solicitors for the wife are to be applied by them in payment of the costs and disbursements incurred by the wife in the conduct of these proceedings.
That the question of the categorisation of any payments made pursuant to these orders shall be a matter for determination by the trial judge.
By consent it is ordered until further order
Parenting
That the children X born … 2010 and Y born … 2013 live with the mother and spend time with the father during the December 2020/January 2021 school holidays as follows:
(a)9.00 am on Friday 11 December 2020 until 5.00 pm on Tuesday 15 December 2020;
(b) 4.00 pm -7.00 pm on Friday 18 December 2020;
(c)5.00 pm on Thursday 24 December 2020 until 11.00 am on Friday 25 December 2020;
(d)5.00 pm on Saturday 26 December 2020 until 5.00 pm on Wednesday 30 December 2020;
(e) 4.00 pm -7.00 pm on Friday 1 January 2021;
(f)9.00 am on Friday 8 January 2021 until 5.00 pm on Tuesday 12 January 2021;
(g) 4.00 pm -7.00 pm on Friday 15 January 2021; and
(h)9.00 am on Friday 22 January 2021 until 9.00 am on Tuesday 26 January 2021.
That paragraph 12 of the order dated 3 July 2020 and paragraphs 2(b) and 2(d) of the order dated 12 February 2020 be suspended during the December 2020/January 2021 school holiday period.
In respect of all short school holiday periods the children live with the mother and spend time with the father as follows:
(a)in accordance with the usual term time set out in the order dated 3 July 2020 save and except that the Thursday morning school drop off is suspended; and
(b)the father’s first weekend period that falls in accordance with paragraph (10)(a) herein during the short school holidays shall be extended by 72 hours and therefore conclude at 5.00 pm on the Wednesday immediately following.
That the father facilitate at least one (1) telephone call between the children and the mother during the time the children are in the father’s care for any extended period of school holiday time at such times as agreed and in the event of no agreement:
(a)at 5.30 pm on Sunday 13 December 2020, 5.30 pm on Monday 28 December 2020, 5.30 pm on Sunday 10 January 2021 and 5.30 pm on Sunday 24 January 2021 in respect of the December 2020/January 2021 school holidays; and
(b)at 5.30 pm on the Tuesday night of the four (4) night period of time provided in paragraph (10)(b) herein.
That the father facilitate the children telephoning the mother at all times requested by the children.
That as and from the start of Term 2 of 2021 and pending the final hearing, paragraph 2(d) of the order dated 12 February 2020 be varied such that the children live with the mother and spend time with the father during the school terms as follows:
(a)from after school on Friday (or 3.00 pm if a non-school day) until 5.00 pm on Sunday each alternate weekend;
(b)from after school on Tuesday (or 3.00 pm if a non-school day) until 6:30 pm each week; and
(c)with X each alternate Thursday morning at 8.00 am for school drop off from the mother’s home to H School and with Y each intervening Thursday morning at 8.00 am for school drop off from the mother’s home to J School.
Property
That the husband do have sole use and occupation of the property situated at N Street, Suburb F (“the Suburb F property”) on the provision that:
(a)Within 14 days of today’s date the husband do pay to ANZ Home Loan Account ending …41 the sum of $22,711.
(b)Within 14 days of today’s date the husband do pay to ANZ Home Loan Account ending ..41 expiration of the moratorium in respect of ANZ Home Loan Account ending …41 the husband do pay to the loan account such sum equivalent to the increase in the balance of the loan account from 1 October 2020 to the end of the moratorium.
(c)Within 14 days of the expiration of the moratorium in respect of ANZ Home Loan Account ending …17 the husband do pay to the loan account such sum equivalent to the increase in the balance of the loan account from 1 October 2020 to the end of the moratorium.
(d)On the expiration of the moratorium in respect of ANZ Home Loan Account ending …41, the husband do pay or cause to be paid all principal and interest amounts due and owing to ANZ as and when they fall due.
(e)On the expiration of the moratorium in respect of ANZ Home Loan Account ending …17, the husband do pay or cause to be paid all principal and interest amounts due and owing to ANZ as and when they fall due.
(f)In respect of the payments to be made by the husband pursuant to sub‑paragraphs (d) and (e) herein, the husband do provide to the wife evidence of the repayments at the end of each month and by no later than the last day of each month including but not limited to:
(i)evidence of the transfer of the funds from the husband’s bank account to the respective ANZ home loan accounts; and
(ii)a statement of the respective ANZ home loan accounts to evidence the deposits made by the husband throughout each month.
(g)In the event that the husband defaults on his obligation to pay the requisite principal and interest repayments by the last day of any given month as required in sub‑paragraphs (d) and (e) herein:
(i)the Suburb F property shall be placed on the market for sale forthwith.
(ii)the husband shall be restrained and an injunction granted restraining him from doing any act or thing which would impede the wife signing a sales agency agreement with BB Agents within 7 days of the default.
(iii)the husband shall be permitted to remain living in the Suburb F property pending the sale of the property only if:
1.The husband follows all reasonable directives and recommendations of the real estate agent appointed by the parties to sell the Suburb F property throughout the sale process;
2.The husband ensures that the Suburb F property is presented appropriately for the purpose of open inspections; and
3.The husband does not interfere with the sale process in any way.
(h)The husband is restrained and an injunction granted restraining the husband from:
(i)entering into a further moratorium with the ANZ or any other agreement in respect of the reduction or elimination of home loan repayments in respect of ANZ Home Loan Accounts ending …41 and …17;
(ii)entering into any arrangement with the ANZ as to the amount of principal and/or interest to be paid by the husband towards the ANZ Home Loan Accounts ending …41 and …17;
(iii)redrawing any sums of money from either the ANZ Home Loan Accounts ending …41 and …17;
(iv)dealing with either of the ANZ Home Loan Accounts ending …41 and …17 in any way with the ANZ without the prior written consent of the wife via her solicitor; and
(v)leasing or otherwise allowing any person to occupy the Suburb F property without the prior written consent of the wife via her solicitor (noting that the husband’s consent to sub‑paragraph (i(v)) herein is on the basis that this does not include visitors, family and friends for short stays and on the basis that the wife does not lease or otherwise allow any person to occupy the property at B Street, Suburb C in the State of South Australia (“the Suburb C property”) without the prior written consent of the husband via his solicitor (noting that the wife’s consent to sub‑paragraph (i(v)) herein is on the basis that this does not include visitors, family and friends for short stays).
That the parties do all such things as shall be necessary to commission a joint Family Assessment Report from Ms P before trial at the husband’s expense.
That paragraphs 2, 3, 4 and 6 of the husband’s First Further Amended Response to Application in a Case filed 26 October 2020 (sealed 27 October 2020) and paragraph 28 of the interim orders sought in the husband’s Amended Response filed 15 June 2020 be dismissed.
That paragraphs 11 and 13 of the wife’s application for final orders (interim) filed 4 June 2020 be dismissed.
That commencing on 23 November 2020 the husband pay the wife $1,000 per week in spousal maintenance (inclusive of the rent for 4 O Street, Suburb Q in the State of Queensland (“the Suburb Q property”)).
That the wife do have liberty to apply to this Honourable Court to vary the schools attended by the children in the event that the husband fails to pay the wife interim spousal maintenance in accordance with paragraph (18) herein.
That within 7 days of today’s date the husband do file an affidavit in his name detailing his employment arrangements including but not limited to the details of his employer, hours of work and remuneration as well as annexing a report from the husband’s treating psychiatrist Dr K addressing the husband’s current state of mental health and capacity to work.
That pending trial the husband do pay all school fees at H School and J School.
That within 14 days of today’s date the husband do all things necessary to cause the motor vehicle driven by the wife to be transferred to the wife (at the husband’s expense in all things) and that thereafter the wife be at liberty to dispose of the motor vehicle and retain the proceeds of sale if she chooses to do so.
That the question of costs be reserved.
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 Millman & Millman 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 ADELAIDE |
FILE NUMBER: ADC30 of 2020
| Ms Millman |
Applicant
And
| Mr Millman |
First Respondent
And
Mr Fazil
Second Respondent
REASONS FOR JUDGMENT
Introduction
Ms Millman (“the wife”) and Mr Millman (“the husband”) are in dispute as to matters of property settlement and the future parenting arrangements for X born in 2010 and Y born in 2013 (collectively “the children”).
The proceedings were commenced in the Federal Circuit Court of Australia and by order made 3 July 2020 were transferred to the Family Court of Australia. By order made 1 September 2020 Mr Fazil was joined as a party to the proceedings.
Various interim applications namely, paragraph 14 of the wife’s Amended Initiating Application filed 4 June 2020, paragraph 4 of the wife’s Reply filed 25 September 2020, paragraphs 29 and 34 of the wife’s Application in a Case filed 10 August 2020 together with paragraphs 4 and 6 of the husband’s Amended Response to an Application in a Case filed 25 September 2020 were listed for hearing before me on 29 October 2020 and then further adjourned to 4 November 2020.
Save as to a possible objection by the husband and the second respondent to a subpoena directed to R Pty Ltd on 1 September 2020 and the wife’s application seeking urgent spousal maintenance listed for hearing on 18 December 2020, judgment was reserved in respect of the interim proceedings.
During the period of the adjournment the parties were able to reach substantial agreement on the outstanding interim matters including the wife’s application for urgent spousal maintenance.
The agreement between the parties was set out in a draft minute of order.
The only matters that remain for determination are [13] and [14] of the interim orders sought in the Amended Initiating Application filed 4 June 2020 seeking the following:-
13.That the husband do pay (or cause to be paid) to the trust account of the wife’s solicitor the sum of $50,000 by way of litigation funding.
14.In the alternative to paragraph 13 herein, that there be a dollar for dollar order such that the husband shall pay (or cause to be paid) to the trust account of the wife’s solicitor such sum as equals the husband’s payments to his solicitors on account of legal fees to date and thereafter on a dollar for dollar basis.
Background
I propose to rely upon the reasons for judgment of Judge Brown in these proceedings bearing the citation [2020] FCCA 1811.
His Honour provided a comprehensive history of the circumstances of the relationship of the parties.
The parties are each highly skilled health professionals. The husband owned and operated a medical practice.
Until mid-2019 the wife was employed at the medical practice, however upon separation in mid-November 2019 the wife’s involvement and her income ceased.
The basis for the transfer of the proceedings was that the proceedings, both as to children’s issues and property settlement, were complex and likely to consume significant court time.
Whilst his Honour made some remarks that go to the merits of the wife’s application, I am not influenced by his Honour’s consideration where there have been significant changes to the financial circumstances of the parties.
The involvement of Mr Fazil
In response to the wife’s Amended Initiating Application and affidavit filed 4 June 2020, the husband filed a Reply and affidavit on 21 July 2020.
The husband sets out the financial arrangements with Mr Fazil. In summary, the husband contends that Mr Fazil provided ongoing financial support by way of loans to the husband and then upon the parties commencing cohabitation in 2006, to the husband and the wife.
Paragraphs 58 and 59 of the husband’s affidavit provide a schedule of the contributions made by Mr Fazil in the total sum of $2,669,762 by way of principal and interest in the further sum of $2,797,697.
There is a dispute between the parties as to the extent of the wife’s knowledge of the various sums provided by Mr Fazil to the husband prior to cohabitation and thereafter to the parties and the interest claimed.
In November 2015 the husband established the E Centre financed by S Ltd but also with personal savings and money allegedly provided by Mr Fazil.
The E Centre was operated by the E Centre Pty Ltd as trustee for W Trust.
In August 2019 the husband established the T practice and U practice owned and operated by T Pty Ltd as trustee for the T Trust and U Pty Ltd as trustee for the U Trust respectively.
The husband asserts that the practices were not trading. He decided that they should be sold and ultimately rejected the various arms-length offers received, on the basis that it would have been a likely condition of sale that the husband remained working as a medical practitioner in circumstances where he did not consider his mental health would have allowed him to do so.
At paragraph 106 of his affidavit, the husband alleges that in January 2020 Mr Fazil sought a return of all loans and interest as soon as possible and in default threatened litigation.
The husband paid Mr Fazil $600,000 on 17 January 2020 and following a demand from Mr Fazil on 30 April 2020 for $5,467,459, proceedings were issued in Queensland claiming the sum of $4,867,459 plus costs. The reduction in the amount sought took into account the earlier payment of $600,000 in January 2020.
The husband contends that he took accounting advice and under what was “intense pressure”[1] he entered into negotiations with Mr Fazil. The negotiations resulted in a Deed of Agreement whereby upon the transfer of the entities holding the three medical practices, the husband was released from all debt to Mr Fazil, the V Bank practice loan of $260,000 and a raft of other liabilities. The husband summarises the financial position of the parties at paragraphs 136 - 139 of his affidavit filed 21 July 2020. In summary and taking into account the transfer of the medical practices, but also the removal of the debt to Mr Fazil in the total sum of $5,200,000, the husband considers the total property of the parties as at July 2020 to be $1,410,840 with superannuation assets of approximately $350,000.
[1] Affidavit of the husband filed 21 July 2020, paragraph 127.
The husband’s estimate brought to account the Division 7A loans in respect of the W Trust at $2,162,988.
In the wife’s affidavit filed 10 August 2020 she denies any knowledge of monies loaned by Mr Fazil and it is uncontroversial that the transfer of the medical practices were without her knowledge. The wife also denies any knowledge of the payment of $600,000 to Mr Fazil in January 2020.
Legal fees of the parties
The parties’ costs statements comprise Exhibit “1” in the proceedings.
The wife’s total costs are in the sum of $116,451.66 with total costs paid to date of $33,343.56.
The husband’s total costs are in the sum of $200,474.33 with further unbilled solicitor and counsel fees of $40,515.
The husband anticipates that the total future costs in the absence of settlement is likely to be in the sum of $300,000.
Interim costs
When making an order for interim costs the relevant source of power must be identified.
In this case the most obvious source of power is s 117(2) of the Family Law Act 1975 (Cth) (“the Act”). It is of course open to consider whether an order should be made under s 80(1)(h) of the Act.
The power to make an order for costs on an interim or final basis is set out in s 117 of the Act which provides:-
(1)Subject to subsection (2), subsections 45A(6) and 70NFB(1) and sections 117AA and 117AC, each party to proceedings under this Act shall bear his or her own costs.
(2)If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4), (4A), (5) and (6) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.
(2A)In considering what order (if any) should be made under subsection (2), the court shall have regard to:
(a)the financial circumstances of each of the parties to the proceedings;
(b)whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;
(c)the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters;
(d)whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;
(e)whether any party to the proceedings has been wholly unsuccessful in the proceedings;
(f)whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and
(g)such other matters as the court considers relevant.
In Klearchos & Klearchos and Ors [2015] FamCAFC 217 the Full Court confirmed that a trial judge in considering an interim application for costs, is required to consider the matters as set out in s 117 of the Act and, specifically s 117(2A).
In relation to litigation funding, the financial circumstances of each of the parties is likely to be the most relevant consideration.
In Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466 at 85,631 Bolland and O’Ryan JJ analysed the relevant authorities in respect of an application for interim costs and stated:-
80.In Poletti and Poletti (unreported, Family Court of Australia, 2 March 1990) Nygh J, when describing an application for “interim costs”, referred to the reasons of the Full Court in Wilson and Wilson (1989) FLC 92-033 (“Wilson”) and said it is a “situation where one party to the marriage controls almost exclusively what might be described as the patrimony of the parties and has control of the bulk of the assets and funds of the parties, where an order may be made to ensure that the other party, who does not have the fortune of controlling those funds, at least has an equal or near equal opportunity to present his or her case”: see also In the Marriage of Polletti (1990) 15 Fam LR 794 (“Polletti”) at 796 per the Full Court (Ellis, Strauss and Butler JJ). The Full Court in Zschokke at 83,220 made a number of relevant remarks about the “desirability of legal representation for both parties in family law proceedings”.
Financial circumstances of the parties
In his affidavit filed 21 July 2020, the husband denied that he had any capacity to pay spousal maintenance as sought by the wife.
At paragraph 165 of his affidavit, the husband described his financial position as “critical” and given the “escalating legal fees” it was the husband’s position that he was no longer able to pay for the children to attend private schools. He sought that the wife sign such documents as may be necessary to cancel the children’s enrolment at their current private schools and enrol them in a State school.
Moreover, the husband refers to a psychiatric report of Dr K dated 10 June 2020 wherein the opinion is that the husband is incapacitated and unable to return to work.
As at 21 July 2020, the husband was in receipt of Jobseeker allowance in the sum of $550 per week and it was his categorical assertion that it was his only income. At paragraph 177 he confirms that he has no resources and does not have the capacity to earn an income. At that time he was not sure if and when he was likely to consider returning to work.
The husband’s financial predicament was exacerbated by the mortgage commitments of approximately $10,000 a month in respect of the retention of the Suburb F property. The husband was frank in his admission that he was unable to sustain the payments and had obtained a COVID-19 moratorium from the bank. The husband said that when the moratorium comes to an end he will not have the capacity to repay the mortgage and believes that the bank will foreclose on the property.
The husband sets out his financial position in his financial statements filed 21 July 2020 and 25 September 2020. In his most recent financial statement, the husband discloses his income as $550 per week and total personal expenditure as $2,826 per week. The husband’s expenditure does not include the payments of $2,307 per week in respect of the Suburb F property mortgage which was suspended until 2 October 2020.
As at September 2020, the property of the parties was considered by the husband to be $1,086,133 (not including the Suburb F property with a gross value of $2,270,000, in the name of the wife). The liabilities were considered to be in the sum of $4,305,711.
The wife’s financial statement filed 4 June 2020 does not disclose any income but lists personal expenditure at $922 per week.
The wife lists her interest in the Suburb F property at $2,270,000 and the Suburb C property at $673,200.
The agreement between the parties
Notwithstanding the husband’s stated impecuniosity, the agreed orders enable the husband to have sole use and occupation of the Suburb F property on the provision that within 14 days the following occur:-
(1)that the husband pay to the ANZ home loan account ending #...41 the sum of $22,711;
(2)that the husband do pay to the ANZ home loan account ending #...17 the sum of $13,837;
(3)that within 14 days of the expiration of the moratorium in respect of the ANZ home loans the husband do pay to the loan accounts such sum as may be equivalent to the increase in the balance of the loan from 1 October 2020 to the end of the moratorium; and
(4)that on the expiration of the moratorium the husband do pay or cause to be paid all principal and interest amounts due and owing to the ANZ bank in respect of the home loan accounts as and when they fall due.
In addition, the husband agrees to pay spousal maintenance to the wife of $1,000 per week, all school fees pertaining to the children attending H School and J School and he will do all things necessary to transfer to the wife the motor vehicle on the basis that she is able to sell the vehicle and retain the proceeds.
In addition to those matters, it is noted that the husband has been able to maintain his legal fees as and when they fall due. The husband is represented and has instructed Queen’s counsel and junior counsel.
There is no explanation by the husband as to the change to his financial circumstances which would enable the ongoing payment of his legal fees, the retention of the Suburb F property, the payment of all outstanding and ongoing loan repayments, the payment of spousal maintenance and the payment of tuition fees in respect of the children attending their current schools.
The most recent evidence to date in respect of the husband’s ability to return to work is that it is unlikely to occur before February 2021 and in any event, the husband’s duties and capacity for employment will be significantly limited.
At paragraphs 41 to 43 of the his affidavit filed 25 September 2020, the husband directly meets the wife’s application for partial property settlement in the sum of $50,000, or in the alternative a dollar for dollar order in respect of her costs. The husband’s position is summarised as follows:-
41.I have no assets or resources to pay the wife a partial property settlement or lump sum for legal fees.
42.I have been informed by Mr Z, a friend in Country L, that he would be prepared to lend me $150,000 towards my legal costs, but only if they are applied to my costs, and not the wife’s costs. I have entered into a Loan Agreement with him which is in the Book of Documents numbered 11. He has to date lent me $19,000.
43.If a dollar for dollar Order is made, I will be self-represented.
It is noted that at the time the husband entered into the loan agreement with Mr Z, he considered that the only asset that had equity in it was the Suburb C property in which the wife resides.
There was no realistic circumstance where the husband was able to retain the Suburb F property. The husband strongly resisted the wife’s application for settlement of property and denied that he had the financial ability to pay for the children’s ongoing school fees.
There is nothing from the husband which indicates any change in his circumstance or indeed where he was able to source money necessary to pay his solicitors a sum slightly in excess of $200,000 to date.
I consider that there is at least a prima facie case that the wife has an entitlement under s 79 of the Act and that it is reasonable for her to be able to properly explore and investigate the issues of contention between the parties, both as to the future parenting arrangements for the children but also the assets that comprise the pool of property available for division. That consideration brings into focus the clear dispute between the parties as to the wife’s application for a s 106B order seeking that the disposition of property by the husband to Mr Fazil be reversed and restored to the asset pool.
The wife and children reside in the Suburb C property in which the wife holds a 99/100th interest and is freehold. The Suburb F property in which the husband resides, is in the name of the wife. The husband considers that he had control over the valuable assets of the parties.
Section 117 of the Act requires that I find there are circumstances justifying an order for costs. I consider that those circumstances exist.
In G and T (2004) FLC 93-176 O’Reilly J referred to a decision in McLean & McLean [2003] FamCA 330 in which her Honour said:-
110.Section 117(2) provides that if the Court is of the opinion that there are circumstances that justify it in doing so the Court may subject to subsection (2A) and the applicable Rules of Court make such order as to costs including by way of interlocutory order as the Court considers just. In my view, that provision provides sufficient power to make the “dollar for dollar” order subject to consideration of the matters in subsection (2A).
The husband has dealt with the assets of the parties without involvement from the wife.
It is not clearly understood the source from which the husband has been able to pay his legal fees to date. The purported agreement with Mr Z does not appear to be open-ended. The husband may contend that his ability to satisfy his financial obligations pursuant to the consent order is now only possible because of the loan arrangements or other largess from Mr Z. It is a condition imposed by Mr Z that he is prepared to fund a range of expenses and outgoings incurred by the husband but refuses to provide any money to the husband if it is to be the subject of a dollar for dollar order.
The comparison between the parties in terms of their ability to fund their legal proceedings is stark. The husband is able to retain solicitor, Queen’s counsel and junior counsel, whereas the wife’s position is reliant upon the good grace and forbearance of her solicitors.
That does not reflect what might be considered a level playing field as between the parties and there is no reason why one party should be disadvantaged in respect of what is agreed to be complex litigation.
Given the extent of the wife’s legal fees both incurred to date and anticipated, the lump sum as sought is reasonable.
I propose to make the orders as sought by the wife.
Conclusion
I make orders as appear at the commencement of these reasons.
I certify that the preceding sixty five (65) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Berman delivered on 8 December 2020.
Associate:
Date: 8 December 2020
2
0