MOSS & MOSS
[2015] FCCA 2237
•27 August 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| MOSS & MOSS | [2015] FCCA 2237 |
| Catchwords: FAMILY LAW – Application for interim spousal maintenance – finding that wife not able to adequately support herself – finding that husband not reasonably able to maintain wife – application dismissed. |
| Legislation: Family Law Act 1975, ss.72, 75(2), 77 |
| In the marriage of Bevan & Bevan MD (1995) FLC 92-600 Bane & Bayley [2013] FCCA 1581 |
| Applicant: | MS MOSS |
| Respondent: | MR MOSS |
| File Number: | MLC 6004 of 2012 |
| Judgment of: | Judge Jones |
| Hearing dates: | 15 July & 3 August 2015 |
| Date of Last Submission: | 3 August 2015 |
| Delivered at: | Melbourne |
| Delivered on: | 27 August 2015 |
REPRESENTATION
| Counsel for the Applicant: | Mr Stavris |
| Solicitors for the Applicant: | Anthonys Solicitors |
| Counsel for the Respondent: | Mr Serra |
| Solicitors for the Respondent: | Berger Kordos Lawyers |
ORDERS
The wife’s Application in a Case filed on 25 February 2014 be dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Moss & Moss is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLC 6004 of 2012
| MS MOSS |
Applicant
And
| MR MOSS |
Respondent
REASONS FOR JUDGMENT
Introduction
This decision concerns an application by Ms Moss (“the wife”) for orders that Mr Moss (“the husband”) pay her interim spousal maintenance in the sum of $600 a week. This interim decision is made in the context of substantive property proceedings which are listed for final hearing on 28 April 2016.
The husband seeks an order dismissing the wife’s application for interim spousal maintenance.
Background
The wife is 50 years of age (born on (omitted) 1964) and presently is a full-time student working limited hours in a (employer omitted). The husband is 54 years of age (born (omitted) 1961) and works full time as a (occupation omitted).
There are two children of the relationship:
a)X born (omitted) 1997 (“X”) who is 18 years of age and is in year 11 at (omitted) Special School. X has special needs having been diagnosed with Autism Spectrum Disorder when he was around two and a half years old;
b)Y born (omitted) 1999 (“Y”) who is 16 years of age and is in year 9 at (omitted) College.
(Collectively “the children”)
The parties married on (omitted) 1995 and separated on 7 March 2012. Final Parenting orders were made by consent on 2 December 2013 which provided for the children to spend time with the parents on a week about basis. It appears that these arrangements applied until early 2015 when Y ceased spending time with her father. X continues to spend time with both his parents on a week about basis.
The wife relied on her Affidavits filed 5 March 2014 and 1 July 2015 and her Financial Statement filed on 1 July 2015, which were read into the evidence.
The husband relied on his Affidavit and Financial Statement filed on 13 July 2015, which were read into evidence.
Both parties were legally represented and were cross-examined.
The Law
Section 72 of the Family Law Act 1975 (“the Act”) provides:
A party to a marriage is liable to maintain the other party, to the extent that the first-mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:
(a) by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;
(b) by reason of age or physical or mental incapacity for appropriate gainful employment; or
(c )for any other adequate reason;
having regard to any relevant matter referred to in subsection 75(2).
Section 74(1) of the Act states:
In proceedings with respect to the maintenance of a party to a marriage, the court may make such order as it considers proper for the provision of maintenance in accordance with this Part.
The Full Court in the matter of Bevan & Bevan (1995) FLC 92-600 at 81,981 held that:
“….an award of spousal maintenance requires:
1. a threshold finding under s 72;
2. consideration of ss 74 and 75(2);
3. no fettering principle that pre-separation standard of living must automatically be awarded where the respondent's means permit; and
4. discretion exercised in accordance with the provisions of s 74 with “reasonable in the circumstances” as the guiding principle.
The matters under section 75(2) of the Act that I am to address include but are not limited to the following:
·The age and state of health of each of the parties;
·The income, property and financial resources of each of the parties and their physical and mental capacity for appropriate gainful employment;
·Where either party has the care or control of the children of the marriage;
·The commitments of each of the parties that are necessary to enable them to support themselves and any child or other person that the party has a duty to maintain;
·Where the parties are separated or divorced, standard of living that in all the circumstances is reasonable;
·The duration of the marriage and the extent to which it has affected the earning capacity of the parties whose maintenance is under consideration;
·If either party is cohabiting with another person – the financial circumstances relating to the cohabitation;
·Any child support that is payable;
·Any other matter the Court decides is relevant.
In summary, therefore, the Court must consider the applicant wife’s needs and then her ability to adequately support those needs from her existing resources. This is referred to as the threshold finding under s.72. Where the Court is satisfied that the wife has established needs and is unable to adequately support herself in relation those needs, then, and only then, does it consider the husband’s capacity to contribute to the wife’s needs.
In Bane & Bayley [2013] FCCA 1581, her Honour, Whelan J set out a summary of the applicable principles, which I respectfully agree with. Her Honour stated at [23]
“23. The following principles guide the application of s.72 of the Act in circumstances where the application is for interim maintenance:
·An application for interim maintenance is the same as an application for permanent maintenance except that the order is made only until further order;[1]
·In spousal maintenance applications, the threshold requirement that the applicant must demonstrate that he or she is ‘unable to support herself or himself adequately’ in s.72 of the Act is to be applied not by reference to any fixed or absolute standard but having regard to any relevant matter referred to in s.75(2) of the Act;[2]
·The test of ability to support oneself is not identical to the test whether one is in need but means whether the applicant is in a position to finance himself or herself from his or her own resources;[3]
·A standard of living that in all the circumstances is reasonable for the party claiming maintenance is not necessarily the same standard as that enjoyed during cohabitation;[4]
·In an application for interim maintenance, the Court does not conduct as exhaustive a hearing as would be the case in determining an order for indefinite maintenance;[5] and
·
It is the nature of an interim spousal maintenance order that, as here, it is made after a circumscribed hearing, in reliance upon evidence which is incomplete and/or unable to be fully tested. Whilst different to urgent spousal maintenance pursuant to s.77 of the Act, orders for interim maintenance are as their title implies. The Court hearing and determining financial proceedings between the parties on a final basis, as clearly will occur in this case in the absence of any intervening settlement, has abundant power to accommodate within its final orders, whether by way of settlement of property or spousal maintenance, any anomalies which full agitation of disputed issues of fact may reveal to have resulted from an earlier interim spousal maintenance order.
There is no reason to think, in the circumstances of this case, that any unfairness or hardship visited upon either party by reason of the interim spousal maintenance order could not, or will not, be addressed in the final orders of the Court”.[6]
[1] In the Marriage of Ashton (1982) 8 Fam LR 675 at 675 per Nygh J.
[2] In the Marriage of Mitchell (1995) 120 FLR 292 at 292 per Nicholson CJ, Fogarty and Jordon JJ.
[3] In the Marriage of Eliades (1980) 6 Fam LR 916 at 916 per Nygh J.
[4] In the Marriage of Wilson (1989) 13 Fam LR 205 at 209 per Strauss J.
[5] Ibid, at 205 per Strauss and Nygh JJ.
[6] Drysdale & Drysdale [2011] FamCAFC 85 at para.40.
The evidence
Bearing in mind that these proceedings are by their nature circumscribed and the evidence in relation to the parties’ interests in property, contributions during the course of the relationship and subsequently and their future needs is yet to be fully tested, the interests of the parties in property and their asserted liabilities is summarised below.
Wife’s Evidence
The wife resides at Property D, Victoria (“Property D property”) with the children and her brother, Mr E (“Mr E”). The Property D property is some 20 acres, 10 acres of which is bush. A house belonging to Mr E, is located on the other 10 acres. The wife and children reside in this house.
The Property D property is owned by (omitted business), which is the corporate trustee for (omitted) Unit Trust. The wife and Mr E each have a 50% share in (omitted business) and both are directors of that company. The wife is the Appointer of the (omitted) Unit Trust. The wife and her brother are beneficiaries of the (omitted) Unit Trust.
Both the wife and Mr E have a 20% interest as tenants in common in a factory premise at Property M (“the Property M property”). The other registered owners are (omitted business), which is the corporate trustee of the (omitted) Family Trust of which the wife is the sole beneficiary. (omitted business)’s interest in the Property M property is 30%. The other registered owner of the Property M property is (omitted) Pty Ltd, which is the corporate trustee for the (omitted) Family Trust. Mr E is the sole beneficiary of that trust.
The wife and Mr E each have one share in, and are directors of, (omitted business) (“(omitted business)”). The wife and Mr E are also directors of (omitted business) (“(omitted business)”) and each hold one share through the corporate trustee of the two family trusts. Until around November 2012, the wife was employed by (omitted business) as a (omitted).
(omitted business) was a tenant of the Property M property until it ceased trading in late November 2012. At this time the wife ceased work and took up full-time study. The other tenant of the Property M property vacated the premises in late 2012 and, since that time, there have been no tenants occupying the premises. The Property M property has been on the market for sale since late 2012 and is yet to be sold.
The wife also owns a third share in property in (country omitted) which has only recently been valued. On the basis of this valuation, the wife’s interest would be around $67,000.
In her Financial Statement filed 1 July 2015, the wife deposes that her present income consists of family assistance payments of $45 a week and $90 a week from working on a casual basis at a (employer omitted) in (omitted). Her evidence was that she receives $18 an hour from this employment and works around two days each week, totalling 5 to 6 hours each week.
In her affidavit filed on 1 July 2015 at [4], she deposes that she was no longer in receipt of a carer’s payment for X, that it ended about 12 months ago. In cross examination, she stated that X was in receipt of a disability pension in the amount of around $200 a week and that he had been in receipt of this pension since he was 16 and a half years old. She stated that the pension was under her control. She deposes that she receives financial support, by way of expenses paid by her brother, Mr E, in the amount of $250 each week.
The wife receives child support payments. As a consequence of Y now being in the mother’s full-time care, the child support payments she receives from the husband were adjusted so that, from 30 January 2015 to 30 June 2015 she received $479.47 per fortnight, from 1 July 2015 to 18 December 2015 she will receive $494.92 per fortnight and, from 19 December 2015 her child support will be $521.36 per fortnight[7]. The wife claimed in her affidavit filed 1 July 2015 at [4], that the husband did not pay the amount of child-support he was required to and this made it difficult for her to budget. This is inconsistent with the documentary evidence which is before me. The husband attached to his affidavit filed 13 July 2015,[8] a Direct Payment Advice issued by the Department of Education and Training for the period from 28 June 2015 to 11 July 2015 (“Direct Payment Advice”). This discloses that the child support payments he is required to pay are debited directly from his net earnings.
[7] Correspondence to the wife from the Child Support Agency dated 16 March 2015, attached to the wife's Financial Statement filed 1 July 2015.
[8] Annexure M-1
In any event, I am satisfied that from 30 January 2015 to 30 June 2015 the wife received $239.74 a week in child-support, that from 1 July 2015 to 18 December 2015 she has and will receive $247.46 a week in child-support payments and that from 19 December 2015 she will receive $260.68 a week in child-support.
The wife deposes that she has two personal loans. The first is with (omitted) Pty Ltd and that the outstanding amount is $61,505.31.
The second loan is with (omitted) Finance and is $38,959.77. In her Financial Statement filed 1 July 2015, she records her repayments for the second loan with (omitted) Finance as $20 a week. She said in evidence that the personal loans were unsecured and that she had not made enquiries regarding a secured loan. She says she believes that her credit rating is such that she would not be able to borrow. In addition, she states that she has an outstanding credit card debt with (omitted) Finance of $15,892.32. Her repayments for this credit card are $25 a week. She deposed that her HELP liability from study was $15,257. In her Financial Statement filed I July 2015, she declares (at item 53) that she has a personal loan in the amount of $155,000 from her brother, Mr E.
She deposes that (omitted business) has an outstanding loan with (omitted) bank of $54,716.57, her share being 50%. She deposes that loan was taken out to pay for work on the Property D property. She also deposes that she has outstanding rates owing to (omitted) Water of $3,493.75 and the (omitted) Council of $7,065.77. [9] These rates are in respect of the Property D property.
[9] Wife's affidavit filed 1 July 2015 at [9].
In her Financial Statement filed 1 July 2015, she declared that her total personal expenditure each week was $1,237.58 which comprised total expenditure included in Part N expenditure at $1,103. She recorded (at item 22) that she paid $60 each week for rates and unit levies. In cross-examination, she agreed that her share was $30 each week.
With respect to Part N of her Financial Statement, the applicant recorded her total expenses for herself at $442 a week and $671 a week for the children. She claimed $230 a week education expenses for herself and $20 a week for the children. She agreed in cross examination that in fact the education expenses for herself was $20 and for the children was $25 each week. She agreed that, therefore, her personal weekly expenses were $232.
The mother was cross examined regarding her estimate of total petrol expenses each week of a $150 recorded in Part N of her Financial Statement. She stated that she drove Y and X to school each day. As Y was now in her full-time care she did this trip each week. She said that the round-trip from Property D to X’s school in (omitted) and Y’s school in (omitted) was around 70 to 80 km each day. She said that in between the commencement and end of school time she went to the Property M property and studied.
The mother was cross-examined regarding the Property M property and, in particular, the fact that the premises had remained untenanted since late 2012 and, despite being on the market since 2012, had not yet been sold. The mother:
a)agreed that in 2014 it had been valued at $845,000. Her evidence is that the property is unencumbered;
b)said that it has been offered for sale at a price of $850,000-$900,000. She and Mr E had recently changed the real estate agent managing the sale. There are inspections of the property being carried out at the moment;
c)said that she was not sure whether the estimate that the annual rental value of the property of the $64,282 per annum as contained in a valuation report (filed on 12 September 2014) prepared by Mr S (who was jointly appointed), was reasonable. The property had been advertised for rental at $2,000 per week plus outgoings. This rental amount had not been lowered but both agents had been instructed to accept any offer to alleviate the burden of finances;
d)denied the proposition put to her that she had engaged in a strategy to keep the property vacant and unsold in order to convince the Court that she was bereft of funds.
Counsel for the parties jointly conveyed to the Court information provided to them by the agent managing the sale of the Property M property. This information was that offers had been made that day for the property. Further, that although the rent advertised for the property was $2,000 plus outgoings, the agent had made it clear to any interested party that lower offers would be considered.
The wife was cross-examined regarding her Financial Statement filed on 7 August 2012. She agreed:
a)that she estimated her wages from her employment as a (omitted) with (omitted business) was $350 each week, that she received income from (omitted business) of $147 each week and that (omitted business) paid life-insurance on her behalf in the sum of $234 a week;
b)that the income she estimated her brother Mr E earned each week of $1,200 was from (omitted business) business. She said he worked as a (occupation omitted).
With respect to the financial state of (omitted business) and (omitted business) businesses, the wife:
a)stated that (omitted business) business remained profitable but that the (omitted business)’s profit started dwindling in 2010 and that by Christmas 2011 it was not profitable;
b)denied that she invented her evidence that (omitted business) ceased trading in late 2012 because it was not profitable;
c)stated that neither she nor her brother had taken any steps to liquidate the company but denied that they were keeping the company “alive” for the future;
d)said the assets of (omitted business) were limited. She estimated the purchase of the parts for the (omitted) was $1200. She stated her brother constructed it. She stated her brother owned all the equipment.
The wife was cross examined regarding her employment history and capacity to work. The wife:
a)stated that she had not worked since November 2012 except for her recent employment as a casual with a (employer omitted). She said she commenced working casually in June 2012;
b)said that she had looked in the local papers for part-time work as a (omitted) in various (omitted) and in (omitted);
c)agreed she had worked for around 20 years in (omitted) and as a (omitted). She said that she did not have formal qualifications as a (occupation omitted);
d)said she had not looked for work as a (occupation omitted) or (occupation omitted);
e)said she had taken up studying full time on-line in November 2012. She was studying a degree to become qualified as a (qualifications omitted) and estimated she would finish the course in late 2016. She agreed that she was then required to undergo two years of practical training before becoming qualified. Consequently, she would not be in a position to look for work as a (occupation omitted) until at least December 2018;
f)said she acquired a (qualifications omitted) around 30 years ago. She has never worked as a (occupation omitted) and has not made enquiries regarding work in that field as she would need to get a new degree. She says that she had not enquired about accelerated programmes in (omitted) as she did not want to work as a (occupation omitted);
g)she denied that, if she had not engaged in full-time study, she would have been able to earn an income sufficient to support herself.
In her affidavit filed 1 July 2015, the wife was critical of the husband for failing to contribute to the private school fees for Y or towards X’s attendance at the (omitted) Secondary Special School. She deposes that Y’s school fees were $6,900 this year and that they currently owed her school the sum of $12,745 in arrears of school fees. She deposed that X’s school fee was $860 per annum. She deposes that during the relationship she paid for all the expenses associated with the children’s education. She deposed that the husband signed an agreement for Y to be enrolled at (omitted) College. She also deposed that the husband had refused to contribute any money towards X’s speech therapy classes. She stated that the classes cost her $90 for a 30 minute session. She said that because of her financial problems she had ceased taking X to the classes some 18 months ago and believed that his speech had deteriorated because of this.[10]
[10] Ibid at [15] to [20].
With respect to the children’s educational costs and X’s speech therapy, the wife stated, in cross-examination:
a)she had reached an arrangement with Y’s school whereby she paid $50 a fortnight. She had not been informed whether the husband was making any contribution;
b)from the Disability Pension that X received each week, she gave him $50 a week for school, and extra money for videos and money for clothing and anything else he required;
c)she had not allocated a portion of this pension to the payment of X’s school fees ($860 annually) or for his ongoing speech therapy;
d)she agreed that the husband had contributed $1,000 towards X’s school camping trip, that the husband paid X’s mobile phone account, that the husband had provided Y with a mobile phone and that he contributed $100 a month for this phone.
At the final day of hearing the parties produced signed minutes which provide for both parties to have control of the account into which X’s pension is paid.
Husband’s evidence
The husband resides at Property H (“Property H property”) which is the former matrimonial home. The Property H property is owned by (omitted business) (“(omitted business)”) which is the corporate trustee of the Moss Family Trust. The Property H property is unencumbered. (omitted business) also owns Units 1, 2 and 3, Property C (“the Property C property”). This property is rented. From 1 March 2001, the husband’s brother Mr P (“Mr P”) was appointed director and secretary of (omitted business). The husband, Mr P and the husband’s sister Ms C (“Ms C”) each have one share in (omitted business).
In his Financial Statement filed 13 July 2015, the husband records his income which comprises his salary (as a (occupation omitted)) as $1,790 each week. The husband attached to his affidavit filed 13 July 2015,[11]a Direct Payment Advice issued by the (employer omitted) for the period from 28 June 2015 to 11 July 2015 (“Direct Payment Advice”).
[11] Annexure EM-1
The wife’s alleges that the husband has underestimated his income on the basis that he earns additional income from (occupation omitted), working as a (occupation omitted) (“(omitted)”), distributions from (omitted business) and additional income from (omitted) and (omitted).[12]
[12] Wife's affidavit filed one July 2015 at [18] to [21].
The wife produced copies of statements of a (omitted) Bank Term Deposit account in the name of the husband, his brother and sister (exhibits H1 and H2). The starting date for the term deposit is 15 June 2011 and the maturity date is 15 June 2012. The investment amount is $12,856.88 with a prepayment amount recorded as $7,000 on 12 April 2012 (H2). As at the closure date on 6 June 2012 the balance was $5,856.88. The husband confirmed that this term deposit was in his and his siblings’ names and the amounts that were invested and withdrawn during the period of the term deposit and at the maturity date.
In her affidavit filed 1 July 2015, the wife annexed (at attachment M - 3) a copy of a bank statement from a (omitted) Bank Term Deposit Disposals account (account number ending (omitted)) dated 13 April 2012 which disclosed total credits into the account of $361,368.20. The account name is “(omitted)”. The wife deposes that she believed that in April 2012, shortly after the parties separated, the sum of $361,345 was withdrawn from the (omitted) Bank account (at [27]). The husband denied, in his affidavit filed 13 July 2015, that he had any interest in the account. He deposed that he communicated with the (omitted) bank regarding this account and was informed that it was an internal document of the (omitted) Bank Mentone Branch (at 37]).
The wife also deposes that she believes the husband is able to obtain a distribution from the family trust from the rental income from the Property C property but he chooses not to. The husband was not cross examined on this point. The wife also deposes that she has reviewed the (omitted business) bank statements held with the (omitted) Bank and they show a monthly withdrawal of $1,600 but that it does not disclose to whom the money is being paid. She deposes she believes this amount has been withdrawn each month since October 2008 (at [29]). The father deposes that in 2008 payments were made to Ms C who required financial assistance, these were paid for about six months until she regained employment. He deposed that he does not receive and has not received any distributions from (omitted business). [13] The husband was not cross-examined about this matter.
[13] Husband's affidavit filed 13 July 2015 at [38].
The wife produced documents which she prepared, said to be summaries of transactions under various categories from credit cards in the husband’s name for the financial years ending 2012, 2013 and 2014. (Exhibits W1 and W2) The wife maintains that the husband has not disclosed any credit card statements for the year ending 2015. These documents were produced in support of her allegation that the husband spends large amounts of money on Internet sites, (omitted) and (omitted) fees for the sale of (omitted), that he has spent sums on audio visual equipment, computers and other electronic equipment, as well as equipment for his weekend business as a (omitted). In cross-examination, the husband stated that the last time he spent money on (omitted) equipment was around five years ago. He said he used this equipment for school functions but was not paid for this. He also used the equipment for one or two jobs he did each year as a (omitted). He said that he earned around $250 in cash for these jobs.
The husband was cross examined on expenditure recorded (in W2) under the category “postage” for the relevant financial years. With respect to the amount of $6,013.05 recorded for the year ending June 2012, he responded that this amount was not simply postage but bills that he paid at the post office for rates, (omitted) and mobile phones, as well as extra cash he may withdraw at the time he paid the bills. He agreed that the record for 2012 included an amount of $3,920 under the category “(omitted)”, however, he maintained that he still paid bills at Australia Post. With respect to an amount of $3,000 and $3,592.75 recorded under the category “postage” for the year ending 2013 and 2014 respectively, he gave the same explanation. He said there were no amounts recorded under the category “(omitted)” in the year ending 2013 and $181.94 for the year ended 2014. He rejected the proposition put to him that he simply spends all his money on whatever he wants.
The husband confirmed that, on 30 July 2012 and 30 August 2013 he withdrew from his (omitted) bank account the sum of $10,000 and $1,000 respectively, to pay his solicitor. He also agreed that on 28 November 2013 he paid the sum of $8,000, using his (omitted) Bank credit card, to pay his lawyers.
In her affidavit filed 1 July 2015, the wife deposed that on 29 October 2014 the husband drew a cheque for $33,723.28 from his (omitted) bank account, however, she could not say from that statement who this money was paid to (at [23]). In his affidavit filed 13 July 2015, the husband disputed the wife’s claim that on 29 October 2014, he drew a cheque for $33,723.28. He deposed that he had contacted the (omitted) bank and they were conducting an enquiry to ascertain the nature of this transaction listed by the wife (Affidavit filed 13 July 2015 at [34]). A copy of the relevant bank statement for this amount was not put to the husband in cross examination. By further affidavit filed on 3 August 2015, the wife attached a copy of a statement for an account held by the husband with the (omitted) bank. It discloses that on 24 October 2013, the husband transferred into his account an amount of $30,000 being “proceeds of loan drawdown from … (omitted).” On the same day, $29,000, this amount was then debited as a “card entry.” The wife claims the fact of this transaction reflects badly on the husband’s credit and supports an inference he has access to additional money.
An issue was raised by the wife in her affidavit filed 1 July 2015 regarding the capacity of the husband to borrow money from (omitted business) (at [22]). However, in her oral evidence, she stated that she did not expect the husband to be required to borrow money from (omitted business).
In his Financial Statement filed 13 June 2015, the husband specifies his liabilities as a $50,000 personal loan from the (omitted) bank, $8000 balance on a (omitted) Mastercard, $8000 balance on a (omitted) Visa card and $9000 balance on a (omitted) Visa card. The husband identifies the following liabilities: a loan from (omitted business), estimated to be in the amount of $49,386, a $7,000 loan from his mother, a personal loan from Ms C and Mr P estimated to be $10,250 and legal fees to his solicitors estimated to be $100,172. The husband alleged (without providing any documentary evidence) that the $49,386 lent to him by (omitted business) is reflected in a loan agreement. He conceded he has not been required to repay that amount, nor has he been asked to repay the personal loans from his mother and from his siblings. He was cross examined on how much of the loan from (omitted business) was “owned” by him. He responded that the trust is a discretionary trust, that he is a beneficiary of that trust (as are his siblings) and that he is a one third share-holder of (omitted business), the other two shares being held by his siblings.
In his Financial Statement filed 13 June 2015, he lists loan repayments each week for the (omitted) Bank personal loan as $240 and for the (omitted) Visa card as $125 each week. As I have already stated, I am satisfied that the contributions he makes each week in child-support are presently $247.46 and from 19 December 2015 will be $260.69.
In his Financial Statement, the husband specifies his weekly tax as $470. The Direct Payment Advice specifies the husband’s regular fortnightly earnings as $3,586.07 or $1793.04 each week. According to this record, the husband’s weekly tax paid is $468. The husband also (at item 20) specifies contributions by him to his superannuation fund ((omitted) superannuation fund) at $90 per week. The Direct Payment Advice records superannuation contribution paid by the husband to the fund as $179.30 each fortnight or $89.65 each week. In his Financial Statement the husband specifies (at item 26) expenditure on health insurance in the amount of $76 each week. The Direct Payment Advice records his health insurance contribution as $77.70 each fortnight or $38.85 each week. In his Financial Statement the husband specifies (at item 22) a weekly payment for rates and levies at $24, for motor vehicle insurance and registration at $33 each week and house insurance at $21 each week.
The wife’s financial circumstances and reasonable needs
The wife earns around $90 a week from casual employment at a (employer omitted). Other than this income, she is reliant on a government benefit and child support. Any entitlement to a means-tested pension or benefit is to be disregarded as being income for the purposes of any spousal maintenance determination: s.75(3).
The wife has been engaged in full-time on-line study to become qualified to work as a (occupation omitted). I am satisfied that, taking into account the requirement to engage in practical training, the wife will not be able to work as a (occupation omitted) until the end of 2018.
The wife has interests in real property as tenants in common (with her brother) in the Property M property and property in (country omitted) and has interests in property through her shares in the corporate trustees of the Property D and Property M property and is also a beneficiary of two family trusts.
The wife’s liabilities include two personal loans amounting to $100,465, a credit card debt of $15,892.32 and a HELP liability from her study of $15,257.
Her expenditure each week in relation to the loans and credit cards is $45. Generally, I am satisfied that the wife’s weekly expenses listed in Part N of her Financial Statement are both modest and reasonable. I am satisfied that the wife’s expenses on petrol are reasonable given the distance from her residence and the children’s schools and the fact that she is now required to undertake this journey each week.
Excluding the necessary expenditures which relate to the children: Stein & Stein (2000) FLC 93-004 and adjusting for the amendments which flow from the wife’s concessions, in cross-examination, as to her expenditure ([27] to [28] above), the wife’s reasonable expenses each week are $326.550.
I am satisfied that the wife’s reasonable needs each week are $326.550.
Is the wife unable to support herself adequately?
In considering spousal maintenance, I must be satisfied of the threshold finding under s.72 of the Act.
The husband argues that the wife does not meet the threshold test of being unable to support herself financially for two reasons. First, he argues she has interests in property from which she could have derived a financial benefit but for a deliberate strategy to avoid that benefit whilst property proceedings are on foot.
I am unable to accept the husband’s contention that the wife has adopted a strategy to ensure that the Property M property has remained vacant and not sold for the purpose of improving her outcome in these property proceedings. The evidence does not support that. I am satisfied that the wife (and her brother) have actively engaged with real estate agents for the purpose of securing tenants for the Property M property and/or the sale of the property. The evidence before me is that there are presently offers being made for the purchase of that property.
The husband also submits that the wife has a 50% interest in the Property D property and that no reasonable explanation has been given why the property has not been subdivided and the land sold. I am not satisfied that the wife should be expected to sell part of a residential property in respect of which she has a half interest with her brother. In the matter of Mitchell & Mitchell (1995) FLC 92-601 at 81,995, the Full Court held that:
“The days are long gone when it is necessary for an applicant for maintenance to use up all of her assets and capital in order to satisfy the requirement that she is unable to support herself adequately.”
Secondly, the husband argues that, as the wife’s study is by an on-line course, the wife is capable of earning more than she presently does. He submits that the wife (and her brother, Mr E) adopted a strategy whereby (omitted business) ceased trading for the purpose of maximising the wife’s outcome from these property proceedings and not because the business was unprofitable. Again, I am unable to find, on the evidence before me, that the wife has embarked on such a strategy.
The husband argues that she has a capacity for remunerative employment as a (omitted) or (omitted), this being work she had undertaken over the course of 20 years prior employment. He argues that she has deliberately chosen not to take active steps to obtain employment which would allow her to support herself, using study as an excuse. He points out that she has only looked for employment in 2015.
The husband submits that the wife is capable of at least working 24 hours a week, which would, on her present rate of pay result in earnings of $432 a week.
The wife’s evidence that she had looked for employment in (omitted) and (omitted) is not supported by any direct evidence.
In the matter of Atwill & Atwill (1981) FLC 91-107, Nygh J was determining whether the wife was unable to support herself by reason of her lack of earning capacity or from her assets. His Honour at 76792-76793 stated:
“The first question is whether she has a capacity for remunerative employment. In her affidavit she states in para 7: “I turned 57 years of age on 14 January 1981. Despite my age I have been able to obtain part-time work as a shop assistant …” There is no direct evidence of any other attempt to obtain employment … Can it be deduced from her age, 57, that she has a reduced capacity for gainful employment? In my opinion there ought to have been additional evidence about lack of training for employment, reduced health … or other factors. However, I can take judicial notice that 60 is the normal age of retirement for women and that it may be difficult for women approaching that age to retain or obtain full-time employment”.
I accept the wife is entitled to engage in retraining to enable herself to maximise her chances for remunerative employment into the future: Plany & Geller [2014] FamCA 114 at [36]. This is a factor the Court takes into account under s.74(2)(h).
The wife is 50 years of age. I am satisfied that the wife has never worked as a (occupation omitted) and would not be able to do so without retraining. Although she has worked as a (omitted) for many years, she has no formal qualifications and her employment experience was with the family business. I am not confident she would be able to secure employment as a (omitted) with other than very small businesses without formal qualifications nor that she is capable, given her age, of performing (omitted) employment. However, her course is on-line and there has been no explanation provided as to why she did not take steps to obtain some employment until recently. Both her children are at school and are teenagers, hence it would seem she has a capacity to work part-time. Taking into account these factors, I find that the wife is capable of doubling the hours she works and, consequently is able to earn around $180 to $216 each week.
The wife’s needs which I have found to be $326.50 each week would still exceed a potential weekly income of $216 by around $116 a week.
Consequently, I am satisfied that the wife is unable to support herself adequately from her own resources by reason of having care and control of Y and her incapacity for appropriate gainful employment.
Is the husband reasonably able to maintain the wife?
I am satisfied that the husband’s salary from his employment as a (occupation omitted) is $1,793.04 gross each week.
The wife alleges that the husband derives additional income to his salary as a (occupation omitted) from:
a)Work as a (omitted);
b)Sale of (omitted);
c)Distributions from the family trusts of which he is a beneficiary.
She complains that he has failed to provide full and frank disclosure and, consequently, the Court should take a robust view regarding the income the husband has available to maintain her.
Other than credit card statements for 2015, I am not able to be satisfied that there has been less than full and frank disclosure by the husband. The course of this property proceeding has been slow, largely because of the difficulty in ascertaining the interests in property and the interest in and valuation of property in (country omitted). It seems to me that both parties have been slow at times in frankly disclosing all of their interests in property. I would not make the findings the wife seeks.
The wife submits the husband has failed to provide any credit card statements, to support the expenditure he says he incurs in his Financial Statement filed on 13 July 2015. She argues that I should not accept his estimates. This argument, in my view, is misconceived. In interim proceedings such as this, parties are not required to support by direct evidence each expense they claim, particularly those identified in Part N of a Financial Statement. Of course, this does not prevent the Court from forming a view as to whether a particular expense is excessive.
She submits that the summary she has prepared (W1 and W2) from the husband’s credit card statements from 2012 to the end of 2014, warrants a conclusion that he has expended excessive amounts in the generation of additional income. Even if I were prepared to give any weight to these summaries, I am not satisfied they disclose excessive expenditure by the husband on items that would support an inference that he engages in activity that generates alternative additional income.
On the evidence before me I am not satisfied that the husband has an interest in or benefits from a (omitted) Bank Term Deposit Disposal Account (account number ending (omitted)). There is no probative evidence before me that the account from which an amount of $359,849.93 was transferred is an account held in the name of the husband and/or (omitted business) or in which the husband has an interest.
I am not satisfied that the husband failed to disclose additional income he has and thereby that his credit is adversely affected because of the transaction of $30,000 recorded in his (omitted) bank account (see [46] above). In oral submission, Counsel for the husband pointed out that the transaction occurred on 29 October 2013 and not 29 October 2014. Second, in the husband’s Financial Statement filed on 12 May 2014 he declared an estimated loan from the (omitted) Bank in the amount of $30,000 (Item 50). In the Financial Statement filed on 13 July 2015, the husband had been declared as having increased to an estimated $50,000.00.
There is no doubt that the husband has received financial assistance from (omitted business). I do not accept, however, that the husband can, without the agreement of his brother and sister, borrow from (omitted business).
The husband’s interest in superannuation is estimated at $340,744.
The husband claims liabilities to financial institutions in the amount of $75,000, together with the personal loans in the amount of $66,636.
Turning to his claimed personal expenditure. As set out in [49], he contributes weekly, an amount of $89.65 to his superannuation fund and $38.85 each week for health insurance. His weekly tax is $468.00 each week. Further, as set out in [24] above he now contributes child support in the amount of $247.46 each week. The claimed expenditure of $240 a week repayment of his $50,00 personal loan from the (omitted) bank seems excessive. However, as the husband was not cross-examined about this repayment I am unable to determine whether the repayments are reasonable. The same can be said of the husband’s declaration that his repayment for his (omitted) Bank credit card liability of $9,000.00 is $150.00 each week.
On the evidence before me, I find that the total of his personal expenditure identified in Part G of his financial statement filed 13 July 2015 is thereby $1,289.96.
In general, I am satisfied the average weekly expenses listed by the husband at Part N of his Financial Statement filed 13 July 2015 are reasonable. I note that since filing his financial statement on 12 May 2014, the husband’s estimate on food has reduced from $220 to $170, no doubt reflecting the fact that he now no longer cares for Y each alternate week. Given the parties have signed consent orders that both have access to the use of X’s pension, I would marginally reduce the amount the husband spends on food by $30 each week The expenses recorded for clothing and shoes, children’s activities, entertainment/hobbies, gifts, hairdressing and toiletries for the children has not changed since the Financial Statement filed 13 July 2015. I would marginally reduce each of these so that the total of these expenses are reduced by $50.00 each week. I would not include the estimate of $30 for other necessary commitments, in the absence of any explanation about these commitments. Making these adjustments, I am satisfied that the husband’s average weekly expenses are $696.
Consequently in total, his weekly expenditure is, I am satisfied, $1,985.96. The husband’s contribution to his superannuation fund is a discretionary contribution and, consequently, for the purpose of determining whether he is reasonably able to maintain the wife, I would reduce his weekly expenditure estimates by $89.65. This leaves an amount of $1,893.31 weekly expenditure.
Findings as to the s.75(2) factors
The wife is now 50 years of age. In her written Outline of Submission she says that she suffers from arthritis and requires a knee reconstruction. However, she did not depose to this in her affidavits nor provide any direct evidence from her treating medical experts.
The husband is 54 and is engaged in regular fulltime employment as a (occupation omitted). His health is good.
Both parties have interests in property through the family trusts and the wife has an interest in the Property M property and property in (country omitted). The parties’ interests in trusts and the wife’s interest in property are factors to be taken into account under s.75(2)(b) and s.75(2)(o). Both parties assert that the other party is in a position to derive income from these trusts. I accept that the husband has received income from the trusts in the past however, on the evidence before me, although both parties are beneficiaries of the trusts, neither control the trusts and consequently, I am unable to make any findings that either party is able to derive income from these interests. The wife will derive some benefit from the Property M property if it is sold. She is entitled however, to utilise her (50%) share in the sale of this property to, for example the construction or purchase of her own home. However, the benefit she may receive, in my view should not be completely ignored by the Court in determining an application for spousal maintenance.
The wife has not worked since late 2012 and I am satisfied that until she commences employment as a (occupation omitted), she will not be in a position to reduce the disparity between her income and the father’s.
I am satisfied that both parties live prudently and have, subject to some minor amendments, not exaggerated their personal needs: s.75(2)(d). The wife has the care and control of one child under 18 years of age: s.75(2)(c) and both parties have equal responsibility for X, who has special needs: s.75(2)(e).
The wife’s interest in the (omitted) Superannuation fund is $34,097.29, the Husband’s interest in (omitted) Superannuation scheme is $340,744. Neither party is in a position to access this interest presently. The wife receives $45.00 a week from the Family Assistance Scheme: s.75(2)(f).
I am satisfied that the wife contributed to the income earning capacity of the husband during the relationship by engaging in gainful employment and incurring the financial burden for the children’s school fees. In so doing, she has put to one side any desire she may have had to study during the course of the marriage. Although the wife has studied to date without financial assistance, I am satisfied that the payment of maintenance by the husband would enhance her future income earning capacity by enabling her to continue in ongoing study for a professional qualification: s.75(2)(j), (k) and (l).
Neither party cohabitates with another person and to date, other than the agreement as to the access by the parties to X’s pension account, there are no relevant orders relating to them.
The father pays child support which is directly debited from his salary. Presently it is $247.46 and will slightly increase in December 2015: s.75(2)(na). Assuming Y remains in her mother’s full time care, this responsibility will continue for another 3 years at least.
Both parents share in the care of X, who although 18 years of age, has special needs. Although, they now have joint control over the account into which X’s disability payment is paid, it is likely that this responsibility will endure into the future: s.75(2)(o).
Conclusion
The husband’s weekly compulsory and unavoidable expenses of taxation, insurance, rates, registration, loan and credit card repayments and child support amount to $1,200.31. After deducting these expenses from his income, the husband has an amount of $592.69 remaining for his other weekly expenses in Part N of his Financial statement. I accept as reasonable the weekly expenditure specified by the father for electricity, telephone, pharmaceuticals, petrol, household repairs and supplies, parking, clothing and shoes, books and magazines and dry cleaning.
I do not accept as reasonable the following weekly expenses:
o $170 for food;
o $20 for hairdressing and toiletries;
o $70 children’s activities and entertainment;
o $20 for gifts;
o $30 other commitments
By reducing this discretionary spending as set out in [86] above, I am satisfied that husband’s discretionary weekly expenses exceed that which is available to maintain his wife by $103.31.
Consequently I am not satisfied that the husband is able to maintain the wife.
Accordingly, I will make orders dismissing the wife’s Application in a Case filed on 25 February 2014.
I certify that the preceding one hundred and two (102) paragraphs are a true copy of the reasons for judgment of Judge Jones
Associate:
Date: 27 August 2015
Key Legal Topics
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Family Law
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Civil Procedure
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Procedural Fairness
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