MP & SAI
[2006] FMCAfam 228
•17 May 2006
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| MP & SAI | [2006] FMCAfam 228 |
| FAMILY LAW – Property – undefended – husband did not participate. |
| Family Law Act 1975 |
| In the Marriage of Clauson (1995) FLC 92-595 Russell v Russell (1999) FLC 92-877 |
| Applicant: | MP |
| Respondent: | SAI |
| File Number: | SYM 3187 of 2006 |
| Judgment of: | Sexton FM |
| Hearing date: | 15 May 2006 |
| Delivered at: | Sydney |
| Delivered on: | 17 May 2006 |
REPRESENTATION
| Solicitors for the Applicant: | Barkus Edwards Doolan |
| Solicitors for the Respondent: | No appearance |
ORDERS
The wife make available to the husband all personal items of the husband including but not limited to his clothing and his tools provided that if the husband fails to collect the items or any of them the wife be at liberty to dispose of, retain or sell the items which have not been collected at the expiration of 60 days from the date of Order.
Within 28 days of Order the husband do all acts, things and sign all documents necessary to transfer to the wife the whole of his right title and interest in the property in CF in the State of New South Wales being the whole of the land in Certificate of Title folio identifier #/#### #, and simultaneously with such transfer the wife shall:
(a)Pay to the husband the sum of $28,083.00; and
(b)Do all acts and things necessary to procure for the husband a release from liability for payment of all moneys due and owing pursuant to mortgage number #### ## granted by the parties to PCL, under the terms of any personal covenant contained therein or personal guarantee for the repayment of the moneys thereby secured.
Except as otherwise provided in these Orders, each party be solely entitled, to the exclusion of the other, to all other property and chattels of whatsoever nature and kind in the name, possession or ownership of that party as at the date of the making of these Orders.
Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders.
Each party be solely entitled, to the exclusion of the other, to superannuation entitlements held in that party’s name.
In the event of either parties’ failure to sign any necessary documents or instruments or to do any acts required or contemplated by these Orders to be done, with such failure continuing for 14 days, then the Registrar of the Federal Magistrates Court of Australia in pursuance of the powers conferred on him or her under s.106A of the Family Law Act 1975, as amended, shall have the power to execute any document or instrument in the name of the person who has refused or neglected to sign any necessary document or instrument or to do any act required or contemplated by these Orders.
Within 7 days from the date of these Orders the Applicant wife serve or cause to be served a copy of these Orders and Reasons on the Respondent husband by pre-paid post to his address in Sydney.
The operation of these Orders be stayed for a period of 42 days.
Each party have liberty to apply at 7 days notice to vary or discharge these Orders, such liberty to apply to expire 42 days from the date of Order.
All outstanding applications otherwise be dismissed and the matter removed from the list of cases awaiting finalisation.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYM 3187 of 2006
| MP |
Applicant
And
| SAI |
Respondent
REASONS FOR JUDGMENT
History of proceedings
These are proceedings for property orders. The proceedings were commenced by the wife who filed an Application on 8 March 2006. The matter was first listed before me on 12 April 2006. The husband had not been served with the wife’s initiating documents and did not appear on 12 April. The wife sought an Order for substituted service. Ms KC, a process server, swore an affidavit on 10 April 2006 in support of the wife’s application for substituted service. Ms KC deposed to her efforts to serve the husband on 13 March, 15 March,
16 March, 19 March and 20 March 2006. Ms KC deposed to having telephone conversations with the husband’s brother, TI with whom the husband was living. Ms KC deposed to the husband’s brother saying on 13 March 2006: “my brother is mentally ill from drugs and is talking about ending it all. Now is not really a good time.” Ms KC tried to serve the documents again on 24 and 25 March 2006. She was unsuccessful. On 29 March Ms KC received a call from Mr TI suggesting the documents be served on him so he could give them to the husband at an appropriate time. On 6 April when Ms KC attended the husband’s home again she deposed to Mr TI advising her he was not able to assist as the husband had been abusive towards him for becoming involved.
On 12 April 2006 I adjourned the proceedings to 10 May 2006.
I dispensed with the requirement for personal service and made an Order for substituted service on Mr TI. I made an Order for the husband to file and serve his responding documents. I noted on the Orders that if the husband failed to comply with Orders and/or failed to appear on the adjourned date, the matter was likely to be listed for undefended hearing. The wife filed an Affidavit of Service on 1 May 2006 sworn by her solicitor on 28 April 2006. I am satisfied the wife complied with Orders made in relation to service of 12 April. The wife’s solicitors made it clear to the husband by letter of 12 April 2006 that the matter would proceed undefended if he failed to comply with Court Orders and failed to appear at Court on 10 May. On 10 May the husband did not appear, nor had he filed any material in response.
I listed the matter for undefended hearing on 15 May 2006 and directed the wife’s solicitors to serve a copy of the Orders on the husband. I am satisfied the wife complied with that Order.
On 15 May 2006 there was no appearance by or for the husband. In oral evidence the wife said both the husband’s mother and brother, TI were aware of the proceedings. The wife last spoke to the husband about the property proceedings on 11 April 2006 when in the morning he said he intended to sign the draft Consent Orders which had been prepared by the wife’s solicitors and in the afternoon told the wife he would make things as hard as he could for her.
As I am satisfied the husband is on notice of these proceedings and has been given the opportunity to be heard in the proceedings, I proceeded with the wife’s application on an undefended basis.
At hearing the wife sought an Order that the husband transfer his interest in the Sydney property to her and that she pay the husband the sum of $25,000.00 and release him from any liability in relation to the joint debt to PCL, secured by way of mortgage on the CF property. She sought Orders that otherwise each party retain items held by each of them respectively including superannuation entitlements.
Background facts
The wife was born on 28 May 1974 and is almost 32. The husband was born on 6 August 1974 and is 31. The parties commenced cohabitation in or about 1999 and married on 14 February 2004. The parties separated on 1 October 2005. There are no children of the marriage.
Since separation, the wife has remained living in the CF property. The husband has been living with his brother TI, in western Sydney.
Issues
The court is asked to decide the percentage entitlement of each party to their nett assets.
The relevant law – property
Section 79 of the Family Law Act 1975 defines the Court’s powers in determining applications for property settlement. Section 79(2) provides that:
“The Court shall not make an Order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the Order.”
Section 79(4) sets out the matters the Court must take into account when considering what Orders should be made for the alteration of the interest of the parties in property. Those matters include:
a) The financial and non-financial contributions made directly or indirectly by or on behalf of each party or by a child to the acquisition, conservation or improvement of any property of the parties;
b) The contribution made by a party to the welfare of the family including any contribution made in the capacity of homemaker or parent;
c) The effect of any proposed Order upon the earning capacity of either party;
d) The matters referred to in sub-s.75(2) as far as they are relevant;
e) Any other Order made under the Family Law Act 1975 affecting a party to the marriage or a child of the marriage; and
f) Any child support payable.
The approach to the determination of an application under s.79 is well established by authority (In the Marriage of Lee Steere (1985) FLC 91-626; In the Marriage of Ferraro (1993) FLC 92-335; In the Marriage of Clauson (1995) FLC 92-595). The process involves four steps. Firstly, identifying the property, liabilities and financial resources of the parties at the time of the hearing. Secondly, evaluating the contributions made by the parties as defined in s.79(4)(a) to (c). This is essentially an exercise in looking back in time from the date of hearing, taking into account the effect of any proposed Order upon the earning capacity of either party. Thirdly, evaluating the relevant matters contained in s.75(2), which is essentially an exercise in looking forward in time from the date of hearing. The court must also take into account any other Orders already made under the Act and child support already provided or liable to be provided in the future for the children of the marriage. Fourthly, the court must be satisfied in all the circumstances that it is just and equitable to make the Orders [section 79(2)]. It is the justice and equity of the actual Orders that the court must consider. Russell v Russell (1999) FLC 92-877.
Evidence and findings
The wife relied on her Application filed 8 March 2006, her Affidavit filed 8 March 2006, her Financial Statement filed 8 March 2006, and her oral evidence. Documents were tendered at hearing.
In relation to Step 1: Identifying the assets and liabilities of the parties
At the commencement of the hearing, the wife’s solicitor submitted a list of the current assets and liabilities of the parties as known to the wife at the date of hearing. That list is set out at paragraph 14. In relation to the values of assets and liabilities, the wife identified internet statements dated 15 May 2006 setting out the balance of funds in her savings account and credit card account [Exhibit 1]. The wife identified a current summary of the parties’ loan account [Exhibit 2]. In relation to the value of her Mazda motor vehicle, the wife relied on a Redbook estimate of private sale value dated 15 May 2006 which gave the national average price of a 2003 Mazda 6 in the range $28,300.00 to $32,500.00 [Exhibit 3]. The balance of her ACP Retirement Fund as at 15 May 2006 was Exhibit 4. The wife annexed to her Affidavit a valuation of the CF property dated October 2005. Exhibit 5 was the share page of the Australian Financial Review for 15 May 2006 which verified the value of her 261 AMP shares. In oral evidence the wife said she obtained the balance of her Esanda loan from Esanda Finance by telephone on 15 May 2006.
In relation to the wife’s assertions about the husband’s assets, the wife deposed to her husband owning a Ford utility, a Quintrex runabout boat, tools, guitars, electronic games and other personal items. To estimate the values of those assets deposed to in her affidavit the wife said she relied on the purchase price of each item. The wife said her husband had accumulated superannuation funds during his years of employment during cohabitation, but she did not know in which funds his entitlements were held.
I set out the list of assets and liabilities as provided by the wife on the basis of the evidence outlined above, as follows:
| Assets as at the date of hearing (to nearest $) | $ |
| Property at CF (joint tenancy) | 525,000.00 |
| Wife’s 2003 Mazda motor vehicle | 30,000.00 |
| Wife’s National Australia Bank account | 109.00 |
| Wife’s AMP shares – 261 @ $9.71 | 2,534.00 |
| Husband’s superannuation entitlement | Not known |
| Husband’s Ford motor vehicle | E10,000.00 |
| Quintrex runabout boat | E3,000.00 |
| Guitars, tools, electronic games held by the husband | E6,000.00 |
| Other assets held by the husband | Not known |
| Joint loan secured by mortgage to PCL | (365,908.00) |
| Wife’s debt to Esanda Finance | (12,152.00) |
| Wife’s NAB Mastercard debt | (10,252.00) |
| Wife’s ACP Retirement Fund | 82,574.00 |
| TOTAL NETT ASSETS [excluding superannuation] | 188,331.00 |
As the evidence of the wife as to the items and values set out in paragraph 15 is not contested, I find the nett asset pool of the parties to be $188,331.00. There is no evidence before me as to the assets otherwise held by the husband. I am therefore unable to take those assets into account in any precise way. As I accept the wife’s evidence that the husband is not presently in paid employment, I find it unlikely the husband has accumulated any other assets of significance since his separation from the wife in October last year.
In relation to Step 2: assessing the contributions of each party.
The parties lived together for approximately 6 years. The wife set out in her affidavit the financial history of the parties’ cohabitation which is not contested.
At the commencement of cohabitation the wife deposed to both parties owning a car but no other assets of significance. Both parties were in full time employment, the wife as a nurse and the husband as a billiard table fitter. The wife deposed to the husband then working as an apprentice carpenter until the last year of their marriage when he was employed as a qualified carpenter. He earned approximately $40,000.00 in the financial year ending June 2005 after an average income of approximately $26,000.00 per annum in his years as an apprentice. The wife has worked full time during the whole of the parties’ cohabitation earning over $100,000.00 since 2001 and currently earning approximately $180,000.00 per annum in salary and bonuses. Until the wife started her employment with ACP Pty Ltd in 2001, the wife says the parties shared their expenses approximately equally. From 2001 the wife has met the majority of the parties’ expenses. The parties kept their financial arrangements separate.
In February 2002 the parties jointly purchased the property in which the wife is living at CF for $425,000.00. The wife contributed $35,000 and the husband an inheritance of $18,000 to the deposit, stamp duty and costs. The parties borrowed the balance of $390,000 from PCL. Since the parties moved into the property in April 2002, the wife has paid all the outgoings including the mortgage repayments from her income, all repairs and all maintenance costs. In 2003 the husband bought a Ford utility for $18,000 which the wife believes his mother gave to him or lent him.
In addition, the wife says she paid for most of the day to day expenses for both parties. She says the husband for the most part retained his income for his own personal expenses, including the expenses associated with running his car. In the last 2 years of the marriage in particular, the wife says the husband was using marijuana regularly and consuming alcohol to excess and used his income at least in part for that purpose. Since separation, the wife has continued to meet all the outgoings on the home including the mortgage repayments without assistance from the husband.
The wife’s unchallenged evidence is that she performed the majority of household tasks including washing and ironing, cooking, shopping and cleaning during cohabitation.
The wife deposed to the husband agreeing to the Orders she proposes by way of property settlement on more than one occasion. However, I find the husband has changed his position a number of times and has not given his consent to the wife’s proposal.
In relation to each party’s superannuation entitlement, there is no evidence before me to support a finding that each party should not retain their respective entitlements. Both parties have worked during cohabitation and as a result of their individual efforts, have accumulated superannuation funds. The wife has an entitlement of $82,574.00. There is no evidence before me as to the amount held in superannuation by the husband.
The Orders that I propose making in this matter will not affect the earning capacity of either party to these proceedings.
Taking all these matters into consideration, I accept the wife’s solicitor’s submission that as a result of their respective contributions, the assets of the parties should be apportioned 75% to the wife and 25% to the husband.
In relation to Step 3: A consideration of ‘future factors’
I have considered the relevant factors listed in s.75(2) of the Act.
·The husband is 31 years of age. He is a qualified carpenter having completed his apprenticeship during the period of the parties’ cohabitation and having worked as a carpenter until October 2005. There is some evidence before me that the husband suffers from a mental illness. The wife said the husband has been consuming alcohol to excess and significant amounts of marihuana. She said she found a noose hanging from her garage roof about 2 months ago with a suicide note left by her husband. On 30 January 2006 the husband threatened to kill himself when on the phone to the wife. The wife described the husband’s erratic reactions to her efforts to resolve the property settlement. The husband’s brother referred to the husband suffering a mental illness as a result of drug use in conversation with the process server. A few days before hearing, the husband told the wife he was moving to Queensland this week. It is unfortunate that there is no evidence before me as to the impact of the husband’s current health issues on his capacity for employment. On the evidence before me, I can make no finding on this issue.
·The wife is almost 32 years and in good health. The wife works full time and receives a substantial salary.
I am not satisfied there is evidence before me to justify an adjustment in either party’s favour as a result of s.75(2) factors.
The wife is therefore to receive 75% of the known nett assets of the parties. The wife will have her car, her bank account proceeds, her AMP shares, and the CF property. She will take responsibility for the mortgage to PCL, the loan to Esanda and her credit card debt. She will retain her superannuation entitlement.
The husband will retain his superannuation entitlements, his Ford utility, his guitars, tools, electronic games, runabout boat and personal items. This amounts to an estimated $19,000.00. On the basis of my findings in paragraph 16 of these reasons, the wife must pay the husband $28,083 for the husband to receive 25% of the known nett assets.
I am satisfied on the basis of the wife’s oral evidence that the husband’s brother and his mother are aware of these proceedings. I have ordered the Orders be stayed for a period of 42 days to enable the husband to be served with these Orders and to give him a final opportunity to be heard in these proceedings. If the husband does nothing in that 42 day period, the Orders can be implemented.
I am satisfied that in all the circumstances of this case, the Orders set out at the commencement of these Reasons are just and equitable.
I certify that the preceding thirty-one (31) paragraphs are a true copy of the reasons for judgment of Sexton FM.
Associate: Collette McFawn
Date: 17 May 2006
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