Mort & Lois

[2007] FamCA 1294

FAMILY COURT OF AUSTRALIA

MORT & LOIS [2007] FamCA 1294

FAMILY LAW – PROPERTY – Order for sale of former matrimonial home to reduce debt 

FAMILY LAW – PRACTICE AND PROCEDURE – Husband in China –Substituted service by email

Family Law Act 1975 (Cth)

APPLICANT: Ms Lois 

RESPONDENT: Mr Mort

FILE NUMBER: DGF 980 of 2006

DATE DELIVERED: 15 October 2007

PLACE DELIVERED: Melbourne

JUDGMENT OF: Brown J

HEARING DATE: 15 October 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr G. Holmes

SOLICITOR FOR THE APPLICANT: Goddard Elliott

Orders

1. That subject to paragraph (2) hereof, service of the following documents upon the husband be dispensed with:

   (a)amended application for final orders filed 17 September, 2007;

   (b)two applications in a case filed 17 September, 2007;

   (c)affidavit of the wife sworn 3 September, 2007;

   (d)affidavit of Mr G sworn 14 September, 2007;  and

   (e)submission filed pursuant to Rule 5.17 of the Family Law Rules 2004 , dated 14 September, 2007.

2. That as soon as practicable the solicitors for the wife forward copies of each of the documents referred to in paragraph (1) hereof, together with a copy of these orders, via email, to the husband at … and that thereafter service of any documents filed herein be effected by email to that email address, until further order.

3. That the former matrimonial home situated at R, in the State of Victoria being all the land more particularly described in Certificate of Title Volume … folio … be sold altogether out of court and the wife be appointed as trustee for such sale, and without limiting the generality of this order, have conduct of the sale and be authorised to sign all documents and do all things in the name of the husband necessary to give force and effect to this order.

4. That upon settlement of the sale the proceeds be disbursed as follows :

   (a)first, to pay all costs, commissions and expenses of the sale and to pay any council and water rates and maintenance levies outstanding in respect of the real property, including legal fees;

   (b)second, to discharge outstanding mortgages with BankWest secured over the R property;

   (c)third, to pay the sum of $15,000 to the wife and such sum be categorised by the trial judge in due course;  and

   (d)fourth, the balance to be held by the wife’s solicitors in trust for the parties, pending further order.

5. That until further order pursuant to s.106A of the Family Law Act1975 a Registrar of the Family Court of Australia is appointed to execute in the name of the husband, and do all acts and things necessary to give validity to, any document required to give force and effect to these orders, and in the event an application is made pursuant to this paragraph which is successful, the husband shall pay the costs of such application, together with any damages arising from his failure to sign the relevant document.

6. That it shall be sufficient authority for a registrar to act pursuant to paragraph (5) herein that he or she has before him or her an affidavit sworn by the solicitor for the wife and filed herein in which the solicitor deposes to:

   (a)the nature of the document requested to be executed by the husband;

   (b)a request to execute the document made by email (to the address in paragraph (2) hereof) to the husband;

   (c)the failure of the husband to return the document executed by him within 14 days of the request.

7. That the husband file and serve a response to the amended application of the wife for final orders filed 17 September, 2007, together with a form 13 statement of financial circumstances, on or before 18 December, 2007 and in the event he fails to do so, the wife have leave to make application to the list Registrar to have the application for final orders listed on an undefended basis.

8. That the wife’s costs of and incidental to the two applications in a case filed on 17 September, 2007 be reserved, and such applications be otherwise dismissed. 

9. That the reasons for judgment this day be transcribed and that copies be made available to the parties, the husband’s copy to be forwarded by the court to the email address referred to in these orders, in the event no address for service has been filed for him.

10. That either party have liberty to apply on short notice in writing to the other party.

11. That pursuant to Rule 19.50 of the Family Law Rules 2004 this matter reasonably required the attendance of counsel.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: DGF 980 of 2006

MS LOIS  

Applicant

And

MR MORT  

Respondent

REASONS FOR JUDGMENT

1. The case commenced when the wife filed an application seeking final property orders on 30 September 2006.  On 17 September, 2007 she filed an amended application for final property orders, and two applications seeking procedural and interim orders. 

2. On 29 January 2007 this court made orders providing for dispensation of service of the initiating application and substituted service on the respondent, via email to a specified email address.  That occurred.  There has been some subsequent and responsive correspondence from the husband from that email address addressed to the wife's solicitors.  Despite that correspondence, the husband has, on the evidence before me, made no attempt to engage with the litigation, and has filed no response. 

3. The wife seeks that personal service of the applications filed on 17 September, 2007 be dispensed with and that the former matrimonial home be sold, in order to meet pressing matrimonial debts. 

4. The parties were married in December 1981.  They separated in April 2002 and a divorce became absolute on 3 December 2005.  During the marriage the parties acquired a business franchise.  After separation, they lived under the one roof and continued to operate that franchise.  One condition of the franchise agreement was that the husband continue to operate the business.  In December 2005, the husband ceased operation and (according to the wife) moved to China.  She has had no personal communication with him since then.  Her solicitors have communicated with him by email. 

5. The asset pool at the time of separation included the former matrimonial home in R, the business franchise, the parties’ cars and superannuation interests, and the household contents (which the wife deposed have been divided by agreement).  One of the cars was sold and the proceeds applied to debts arising out of the failed franchise business.  The wife has retained the other car, to which she attributes a value of some $10,000.

6. The parties’ home was built in 1998, using the proceeds of an earlier property and a mortgage.  They lived there until the husband left Australia.  When the wife swore her affidavit, the mortgage on that property stood at just over $131,000.  In addition, over $232,000 was secured against the home, being a debt associated with the franchise business.  Without summarising the whole of the evidence, the wife’s evidence is that the business could not continue after the husband left.  The wife has no sufficient qualifications.  She attempted to run the business, but it was impossible.  A default notice was served, pursuant to the franchise agreement.  Eventually the business provider exercised its right to re-enter the premises, revoked the franchise agreement and sold the business in July 2007 for $120,000.  While that sum has gone some way towards clearing the franchise debt, the parties still owe a significant sum which, as I have said, is secured against the former matrimonial home.  There is a risk the bank will foreclose on the property.

7. There is evidence that the wife's solicitors requested the husband to appoint a power of attorney in Australia, to assist with the signing of necessary documents.  He has failed to do that.  He has failed to engage with this litigation, filing no response.  The evidence is that service is extremely difficult to organise in China, even if one were to know the exact whereabouts of a party to litigation in this court, living among many, many millions of people.  The husband’s exact whereabouts is not known.  Service would be very expensive and while it could be attempted, success is not guaranteed.  Emails have been received from the husband from the email address which the court earlier ordered could be used to serve the initiating application.  I am satisfied it is appropriate to dispense with service of all documents in the future, pending further order, save by email to that address.

8. I am satisfied on the evidence before me that the former matrimonial home should be sold now.  The financial position is not tenable.  The net proceeds will be applied to discharge the mortgage and the balance, save for $15,000, held in trust by the wife's solicitors pending final orders.  The sum of $15,000 will be paid to the wife, whose financial position is parlous.  It can be characterised by the trial judge in due course, whether as spousal maintenance or part property settlement. 

I certify that the preceding 8 paragraphs are a true copy of the reasons for judgment herein of the Honourable Justice Brown AM

Associate: 15 October 2007