Montesi and Montesi

[2009] FamCA 285

FAMILY COURT OF AUSTRALIA

MONTESI & MONTESI [2009] FamCA 285

FAMILY LAW – MAINTENANCE – INTERIM LUMP SUM MAINTENANCE – INTERIM COSTS – whether proceedings or fact lead to exercise of discretion to make orders

Family Law Act 1975 (Cth) ss 72, 74, 75(2), 117(2), 117(2A)

In the Marriage of Poletti (1990) 15 FLR 974

APPLICANT: Ms Montesi

RESPONDENT: Mr Montesi

FILE NUMBER: SYF 3505 of 2006

DATE DELIVERED: 30 March 2009

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: The Hon. Justice Rose

HEARING DATE: 23 March 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: P Cook

SOLICITOR FOR THE APPLICANT: K P Lawyers and Barristers

COUNSEL FOR THE RESPONDENT: G Johnston

SOLICITOR FOR THE RESPONDENT: Miller Goddard Solicitors

Orders

Interim spousal maintenance

1. The Amended Application in a Case of the husband filed 19 March 2009 is dismissed.

Interim Costs

1. That each of the parties forthwith furnish all necessary authorities and directions to Miller Goddard Lawyers requiring them to apply the funds held by them in the controlled monies account in trust for the parties as follows:

   (a)      $30,000 on account of the Single Expert’s fees.

   (b)      payment to each of the parties of the remaining balance in equal shares.

2. That any other outstanding application for interim costs is dismissed.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYF 3505 of 2006

MS MONTESI

Applicant

And

MR MONTESI

Respondent

REASONS FOR JUDGMENT

Introduction

1. By her application in a case filed 20 February 2009, the wife seeks a review of orders for interim spousal maintenance and interim costs made by Loughnan JR on 17 February 2009 (“the Orders”).

2. The review is opposed by the husband.  He was the applicant before Loughnan JR pursuant to his application in a case filed 16 January 2009. 

3. In accordance with that application he had sought an order that the sum of $152,789.40 be paid to him from the controlled monies account of the Commonwealth Bank of Australia held in the name of his solicitors in trust for the parties (“the controlled monies account”).

4. The husband filed an Amended Application in a Case on 19 March 2009.  Pursuant to that application, he sought orders whereby the controlled monies account was apportioned as to $54,482.00 plus $1,760.40 by way of interim maintenance in his favour and the sums of $42,034.00 and $15,400.00 be paid for his benefit in satisfaction of arrears of legal fees.  And the further sum of $39,105.00 be paid to him or, implicitly, his solicitors for future counsel’s fees.

5. The wife sought a dismissal of that application.  The wife’s application for review was heard de novo[1].

   [1] Section 37A(10) of the Family Law Act (Cth) 1975

6. The hearing proceeded on the Papers in accordance with the usual practice and procedure.  Leave was not sought to cross-examine either of the parties.

Interim spousal maintenance

1. As referred to earlier, the husband’s application for interim spousal maintenance was for payment of two amounts in effect for lump sum interim maintenance.

2. I was not referred to any authorities which set out the principles upon which lump sum maintenance, interim or final, may be paid.  That was not a point taken by counsel for the wife.  Rather, the case was conducted on the basis of whether the discretionary power to order maintenance contained in section 74 should be exercised having regard to the provisions of section 72(1).

3. It seemed that the case for the husband is that he is unable to adequately support himself “for any other adequate reason, having regard to any relevant matter referred to in 75(2)”[2].

   [2] Section 72(1)(c) of the Family Law Act (Cth) 1975

4. Submissions made by counsel focussed on relevant matters pursuant to section 75(2) and the weight that should be attributed to them.  I considered that was an acceptable approach to the conduct of the case and I will make findings and give conclusions accordingly.

5. The evidence of the husband’s income, expenditure, property, superannuation and any other relevant financial matter are set forth in his Financial Statement sworn 19 December 2008 and his affidavit sworn 16 January 2009.  The husband discloses gross income of $381.00 per week, which includes employment benefits of $31.00 per week.  His occupation is that of a waiter apparently employed on a casual basis.  There is no reference to gratuities (if any) that he may receive in that occupation.

6. He discloses expenditure of $356.00 per week.  That does not include payment of any child support.  It appears to be common ground that child support is not paid.  Whilst on the face of it, he would have net available funds of $25.00 per week, a closer perusal of his financial statement reveals that the employment benefits of $31.00 per week are superannuation contributions.

7. The husband lives with his parents and does not pay rent.  His total expenditure of $356.00 per week includes Item 32, which is “total of all other expenditure” $280.00 per week.  No detail is given in his financial statement which provides the basis for calculation of that amount, notwithstanding that there is an appropriate form of financial statement which has been in existence for a considerable period to enable a person such as the husband to set out that detail.  For reasons best known to his legal advisers, that form was not used.

8. Consequently, there is an absence of crucial evidence, namely particulars of all of his alleged expenditure on a weekly basis. 

9. The husband discloses net property of $17,657.00.  His superannuation entitlements amount to approximately $69,000.00.  No evidence is given of him having sought to access that superannuation, if indeed he has made any application to the appropriate authority.  His financial resources as described as “nil”.

10. The husband has disposed of property subsequent to separation with proceeds of sale having been paid to him totalling $18,000.00.  No detail is given in his financial statement or his affidavit as to the use by him of that amount.

11. The evidence before me demonstrates that the husband has the capacity to earn income as a waiter; driver; barista or in administration.  No evidence is given by the husband as to any application that he may have made for employment in one or more of those capacities, let alone the circumstances which leaves him employed only as a casual waiter.

12. Annexure “A” to the husband’s affidavit reveals that he has received a total of $60,000.00 over a seven-month period, namely from 15 November 2007 to 26 June 2008.  No evidence is given by him regarding the use made by him of those funds.

Conclusion

1. I have determined that the husband’s application for an order for interim spousal maintenance will be dismissed.

2. My reasons are that the husband has not satisfied me, on the evidence that he has provided, that he has fully disclosed not only all of his income but he has failed to set out by way of disclosure the basis for his contended expenditure, in part, of $280.00 per week.

3. In addition, as I have previously noted, there is no evidence given by the husband of his use of $18,000.00 received by him subsequent to separation from the proceeds of sale of property, nor of his use of $60,000.00 over the seven month period concluding in the middle of June 2008, nor of any application that he may have made in relation to one or more of the capacities for employment to which I have referred, or if no application has been made, then the circumstances which surround the lack of any such application.

4. Consequently, I am not satisfied that he has demonstrated that he is unable to adequately support himself, having regard to the relevant matters set out in section 75(2).  As a result, an order will be made that his application for interim spousal maintenance be dismissed.

Husband’s interim costs application

1. The husband has made application for an order for interim costs.  I have referred to his application in that regard.  The power to make the orders sought is contained in section 117(2). 

2. In this matter I am proceeding on the basis of the potential exercise of power pursuant to section 117(2).  No contrary submission was made.  It is well-established that I have a wide discretion to exercise.  I find that there is a circumstance which may result in the orders sought being made in that the husband does not presently have funds to the extent which may be necessary for him to have his case properly prepared and presented.

3. In that regard I rely upon the Full Court’s judgment in Poletti[3].  However, the fact that a circumstance has been established does not lead inevitably to an order being made.  The reason is that I must consider relevant matters that arise pursuant to section 117(2A).

   [3] In the Marriage ofPoletti (1990) 15 FLR 974

4. I have made previous findings in relation to the husband’s financial circumstances and the lack of evidence in relation to important aspects of those circumstances.  I rely upon those findings.

5. In addition, I have also made findings in relation to the lack of evidence of significant amounts of money which the husband has received since separation in relation to the use by him of such amounts.  Those amounts total $78,000.00 based on my previous finding, quite apart from approximately $57,000.00 made available to him from the controlled monies account so that he might then satisfy a judgment obtained against him by the wife’s father.

6. In addition, there is considerable and detailed evidence in the wife’s affidavit in relation to large amounts of cash that have been received by the husband by way of withdrawal from one or other of accounts and/or as a result of loans having been made, particularised with documents in such affidavit, which is not the subject of any response by the husband in his affidavit material.  In addition, there is also substantial evidence in support of the wife’s allegations of the husband’s gambling activities.  In that regard the husband’s evidence is silent. 

7. Consequently, there have been large amounts of money received by the husband and utilised for his benefit for which there may well be an explanation which carries cogent weight.  My difficulty is that the husband’s evidence as placed before me does not provide any explanation at all, let alone at the level to which I have referred.  The husband clearly has limited property at his disposal.

8. I have accepted the submissions made by counsel for the husband that he has a case of substance to continue to litigate in terms of the pending applications for property settlement.  In particular, one of the important issues will be the finding as to the shareholding that the wife holds in P Company Pty Limited and the value of such shareholding.  There is no issue on the material before me that whatever the shareholding is, whether it is a joint interest in a parcel of 50,000 shares or a shareholder’s interest for a larger quantity of shares, that such shares cannot currently be realised as the wife is a minority shareholder.

9. In addition, I do not have any evidence of the class of shares held by the wife or the rights attaching to those shares.  Assuming, however, in favour of the husband that those shares are ordinary shares, then her rights at a minimum will be to participate in the distribution of capital on a winding up.

10. I was informed by counsel for the husband that there is a pending application by the wife’s sister, who is a party to the proceedings, for orders on the basis that she is an oppressed minority shareholder.  Her case in that regard has yet to be heard and determined.  It may be that those proceedings will be heard in this jurisdiction or otherwise pursuant to the remaining aspects of what was the cross-vesting scheme.  Those proceedings could possibly be transferred for determination in the Supreme Court of New South Wales.  In any event, those issues have yet to be determined. 

11. As a result, whilst the husband does have a case of substance in terms of demonstrating the extent of the wife’s property interests reflected by her shareholding in P Company Pty Limited, the reality is that at the present time those shares cannot be realised.

12. A number of financial accounts of P Company Pty Limited were tendered.  They have demonstrated the issue in terms of an issue of substance that the husband seeks to litigate.  They do not assist me in terms of coming to a conclusion that at the present time the wife’s shares, regardless of their value, can be realised, either in whole or in part, to produce funds upon which drawings may be made by the wife or as may be otherwise susceptible to an order for interim costs.

13. So far as the husband’s property is concerned, I rely upon the findings previously made by me in relation to his interim spousal maintenance.  I have also taken into account the lack of evidence by him in relation to the application by him of significant amounts of money earlier referred to in this judgment.  There is no issue between the parties that the single expert, who is in the process of completing a report in respect of the wife’s shareholding in P Company Pty Limited, is likely to have further fees incurred of approaching $30,000.00.  The only fund from which those fees can be paid is the controlled monies account.

14. I have concluded that an order will be made in favour of the husband in relation to a portion of the funds held in the controlled monies account.

15. That order will be on the basis that the amount of $30,000.00 required to be held to meet potential further fees incurred by the single expert will be retained in that account and the balance remaining divided between the parties equally.

16. I raised that as a prospect with counsel for the wife and I was informed that there was no opposition to it.  It does not follow from that that therefore such an order should be made.

17. However, I have concluded that an order on that basis will be made due to aspects of the husband’s financial circumstances which have not been dealt with in his affidavit evidence.  They reflect largely significant amounts of money which he has received for his own use and benefit subsequent to the separation of the parties as detailed in the affidavit of the wife and otherwise as determined in relation to specific amounts the subject of my findings in this judgment.

I certify that the preceding thirty-nine (39) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rose

Associate: 

Date:  20 April 2009