NAUGHTON & NAUGHTON
[2017] FCCA 630
•31 March 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| NAUGHTON & NAUGHTON | [2017] FCCA 630 |
| Catchwords: FAMILY LAW – Property – Undefended Final Hearing - applicant sought vast majority of ascertainable pool of assets – whether just and equitable. |
| Legislation: Family Law Act 1975, ss.75, 79 |
| Cases cited: Bevan & Bevan [2014] FamCAFC 19 Black & Kellner (1992) FLC 92 - 287 Chapman & Chapman [2014] FamCAFC 91 Russell & Russell (1999) FLC 92 – 877 Scott & Danton [2014] FamCAFC 203 Stanford v Stanford (2012) 247 CLR 108 Teal & Teal [2010] FamCAFC 120 |
| Applicant: | MS NAUGHTON |
| Respondent: | MR NAUGHTON |
| File Number: | PAC 2803 of 2016 |
| Judgment of: | Judge Obradovic |
| Hearing date: | 3 March 2017 |
| Date of Last Submission: | 3 March 2017 |
| Delivered at: | Parramatta |
| Delivered on: | 31 March 2017 |
REPRESENTATION
| Appearing for the Applicant: | Ms Morrison |
| Solicitors for the Applicant: | Mahony Family Lawyers |
| Appearing for the Respondent: | No appearance |
ORDERS
That the parties have equal shared parental responsibility for the children X born (omitted) 2004 and Y born (omitted) 2005.
That the children shall live with the Applicant.
That the children shall spend time with the Respondent as follows:
(a)During school terms, each alternate weekend from 7.30pm Friday until 6.30pm Sunday;
(b)From 6.30pm on the second Sunday following Christmas Day until 6.30pm on the third Sunday following Christmas Day;
(c)With such time to continue in an alternate week about patterns until the conclusion of the school holiday period;
(d)For half of each New South Wales school holiday periods (excluding the Christmas school holiday period) as agreed, but failing agreement from 7.30pm on the last day of term until 10.00am on the middle Saturday of the holiday period;
(e)On the Father’s Day weekend as agreed between the parents.
(f)For Easter, from 7.30pm on the Thursday prior to Good Friday until 6.30pm on Easter Monday in odd numbered years.
That notwithstanding any other order herein, the children’s time with the Respondent shall be suspended and the children shall spend time with the Applicant, as follows:
(a)From the conclusion of the Term 4 school term until 11.00am on Christmas Day;
(b)From 6.30pm on the first Sunday following Christmas Day and until 6.30pm on the second Sunday following Christmas Day;
(c)From 6.30pm on the third Sunday following Christmas Day and until 6.30pm on the fourth Sunday following Christmas Day;
(d)With such time to continue in an alternate week about pattern until the conclusion of the school holiday period;
(e)For Easter, from 7.30pm on the Thursday prior to Good Friday until 6.30pm on Easter Monday in even numbered years; and
(f)On the Mother’s Day weekend as agreed between the parents.
That for the purposes of facilitating these orders, school holiday periods shall be deemed to:
(a)Commence at 7.30pm on the last day of school attendance;
(b)Conclude at 7.00pm on the Saturday immediately preceding the first day of school attendance;
(c)Reach the ‘halfway’ point at 10.00am on the middle Saturday of the holiday period.
That for the purposes of facilitating these orders, a ‘school day’ or ‘day of school attendance’ shall be determined:
(a)For a public school, in accordance with the school year calendar published by the New South Wales Department of Education and Training or such authority as may in future take place of the New South Wales Department of Education and Training.
(b)For any other school, in accordance with the school year calendar published by the school.
(c)To exclude pupil free days or staff development days.
That for the purposes of changeover where the Respondent’s time with the children is due to commence at the conclusion of a school day or conclude at the commencement of a school day changeover is to occur at the children’s school, and at all other times by the Respondent collecting the children from or returning the children to the Applicant’s home.
That changeover shall be effected by the parties in person or their nominee.
That the parties shall communicate by way of SMS message in regards to all parenting issues (except for those related to medical or other emergency).
That each party be at liberty to telephone the children on a nominated phone number between 7pm and 7.30pm on each evening that the children are not otherwise in their care and the other party shall facilitate such calls by ensuring the availability of the child and the availability of a telephone and telephone line for such purpose.
That each party shall inform the other party of their address, contact telephone number, landline number (if any), email address and mobile phone number and advise the other party in writing within 48 hours of any change in these details.
That each party shall be restrained from discussing these proceedings with any third party by use of social networking including Facebook and Twitter.
That the parties shall not denigrate the other party in the presence or hearing of the children and that each party shall ensure that no third party denigrates the other parent in the presence or hearing of the children.
That each party shall do all things necessary to ensure that the children attend any appointments scheduled with counsellors, doctors or other health professionals and that the children undertake any treatment or other activities prescribed and directed to be undertaken by their counsellors, doctors or other health professionals.
That in the event of any child suffering a medical emergency requiring medical attention while spending time with or living with either parent:
(a)The other parent is to be notified as soon as practicable;
(b)That the other parent is to be provided with the full details of the practitioner or medical facility upon which the child attend as soon as practicable;
(c)That the medical practitioner or medical facility be advised that the other parent has access to the child’s medical records and the information obtained with them upon request.
That the Applicant shall make arrangements at the children’s school(s) to ensure that the Respondent can obtain the following information and documents at his own costs:
(a)A copy of all school reports and school photo order forms for each child.
(b)Notification for school activities that he may decide to attend, such activities being those that parents are ordinarily entitled to or invited by the school to attend.
(c)Notification of parent/teacher nights and the school is informed that it is the Respondent’s desire to attend such events.
(d)In the event of either child being taken from the school for an emergency, remedial or correctional treatment that the Respondent be informed as soon as practicable.
That the Applicant shall do all things necessary to ensure that the Respondent is recorded at the children’s school(s) as a person permitted to deliver and collect the children from that school(s) and that the Respondent is recorded as an emergency contact person at the children’s school(s).
For the purposes of these orders, any reference to “school or ‘school(s)’ or ‘schools’ shall be deemed to include primary schools and high schools.
That each party shall ensure that the children attend any extracurricular commitments at which attendance is compulsory or generally expected as part of the enrolment or participation in said activity, including but not limited to cultural, sporting and social events.
That the parties shall consult on any extra-curricular commitments for the children for which attendance is compulsory or generally expected as part of the enrolment or participation in said activity where such attendance falls at times the children lives with and spends time with each party, including but not limited to cultural, sporting and social events.
That the parties within 14 days do all things necessary to facilitate the issuing of passports for the children and share the cost of passport fees for those children.
Upon the issuing of the passports referred to in paragraph 21 above, that custody of those passports remain with the Applicant and the Applicant provide the children’s passports to the Respondent as requested on 14 days’ notice provided that the Respondent first provides to the Applicant details sufficient to comply with order 23 below.
That the parties shall only be permitted to travel with the children or allow a third person to travel with the children outside of the state of New South Wales or the Commonwealth of Australia where they comply with the following:
(a)Provide the other party with 21 days’ notice of such intended travel;
(b)Provide the other party with an itinerary for such intended travel;
(c)Provide the other party with contact telephone numbers and address for all places at which the children will stay during such travel;
(d)Provide the other party with copies of all travel tickets or bookings and in particular, a copy of the return travel ticket.
That the funds currently held in the trust account of Helliars Solicitors following the sale of the former matrimonial home at Property F be allocated 100% to the Applicant.
That the Respondent shall be and is hereby declared to be the sole and absolute owner at law and in equity as against the Applicant:
(a)Any motor vehicle in his possession;
(b)All items of furniture and contents in his possession;
(c)All savings or monies in his possession, custody or control, other than stated above;
(d)His contributions and accumulated entitlements with respect to or arising from his membership of any superannuation fund; and
(e)His employment related entitlements including but not limited to annual leave, sick leave and long service leave.
That the Applicant shall be and is hereby declared to be the sole and absolute owner at law and in equity as against the Respondent:
(a)Any motor vehicle in her possession;
(b)All items of furniture and contents in her possession;
(c)All savings or monies in her possession, custody or control, other than stated above;
(d)Her contributions and accumulated entitlements with respect to or arising from her membership of any superannuation fund; and
(e)Her employment related entitlements including but not limited to annual leave, sick leave and long service leave.
That in the event that either party fails to execute any deed or instrument necessary to give effect to these Orders within seven days of being requested to do so, the Registrar of the Federal Circuit Court of Australia at Parramatta shall be appointed pursuant to s.106A of the Family Law Act1975 to execute such deed or instrument in the name of such party and do all acts and things as may be necessary to give validity to the operation of the deed or instrument.
Remove all outstanding issues from the list of cases awaiting finalisation.
IT IS NOTED THAT:
The Respondent will use his best endeavours to ensure that the children are provided a bed each to sleep in at his home and also a bedroom to sleep in other than the Respondent’s bedroom.
IT IS NOTED that publication of this judgment under the pseudonym Naughton & Naughton is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PARRAMATTA |
PAC 2803 of 2016
| MS NAUGHTON |
Applicant
And
| MR NAUGHTON |
Respondent
REASONS FOR JUDGMENT
Introduction
These are final parenting and property proceedings.
The matter proceeded on an undefended basis as against the Respondent, who despite a number of procedural orders, had failed to appear at final hearing or file any documents as directed.
The Court is satisfied, having regard to the evidence upon which the Applicant relied and the matters outlined in the Outline of Case Document, that the Respondent was aware of the proceedings and that the matter was listed for final hearing but chose not to participate.
Chronology
The Applicant was born on (omitted) 1980 and is currently 37 years of age.
The Respondent was born on (omitted) 1970 and is currently 46 years of age.
The parties began cohabitation in approximately 1998 and were married on (omitted) 2000.
The parties purchased Property S (‘the Property S property’) for approximately $200,000 in approximately December 2000.
The Respondent received an inheritance of approximately $150,000 - $200,000 which was paid onto the home loan and subsequently withdrawn for investments in the Respondent’s sole name via a managed fund.
The parties’ first child X was born on (omitted) 2004.
The parties’ second child Y was born on (omitted) 2005.
In 2006 the parties sold the Property S property for approximately $378,000 and purchased a property at Property F for $592,000.
The Applicant’s parents loaned the parties approximately $1,500 to upgrade the pool cleaning system of the Property F property. In addition the maternal grandmother loaned the Applicant approximately $5,000 to $6,000 over the course of the time that the Applicant lived at Property S and Property F to assist the parties with payment of credit card bills.
The maternal grandmother assisted the parties with the care of the children for a number of weeks whilst the children were unwell and hospitalised.
Between 2006 and 2013 the Respondent received further portions of an inheritance from his late father’s estate. The Respondent deposited cash into the home loan offset account and was living off that money as he was not working at the time. He also received a portion of a home unit at (omitted) as part of the inheritance which he continues to have a beneficial interest in.
In 2007 the Applicant commenced working at (employer omitted) in (omitted).
In approximately 2010 and 2011 the Respondent’s business failed and he sold the (omitted business), a business which he owned prior to the birth of the children.
The parties separated under the one roof in January 2012.
The Respondent obtained employment in approximately 2013.
The parties sold the property at Property F for $890,000. The proceeds of that sale being $369,226.85 being placed in trust by Helliars Solicitors.
The parties ceased living under the one roof in 2014 and the Respondent began spending overnight time with the children each alternate Saturday. This arrangement ceased when the Respondent was unwilling to purchase beds for children.
The Respondent began to spend day time with the children each alternate weekend where he would collect the children on Saturday morning and return them to the Applicant on Saturday night; and collect them on Sunday morning and return them Sunday night.
From approximately February 2014 the children began spending every Saturday with the Respondent at their request.
The parties attempted mediation in 2014 however this was unsuccessful and the mother was issued with a s.60I certificate.
In 2015 the Respondent’s time with the children varied, sometimes seeing them on Saturday, sometimes on Sundays and sometimes on both days.
In approximately November 2015 the children spent overnight time with the Respondent most weekends with the Respondent collecting the children at about 9am Saturday and returning them to the Applicant between 5pm and 8pm Sunday evening. This arrangement worked well, however the father began picking up and dropping of the children at varying times, sometimes late on Sunday night.
During the 2015/2016 Christmas school holidays the Respondent left the children unattended at home whilst he went to work. At this time the Respondent’s overnight time became conditional upon a suitable third party supervising the children whilst the Respondent was at work.
On 16 February 2016 the Applicant provided the Respondent with financial disclosure, the Respondent did not respond.
On 1 March 2016 the Applicant requested disclosure from the Respondent and provided notice of her intention to commence proceedings. The Respondent did not respond.
On 20 June 2016 the Applicant commenced proceedings.
Between 23 June 2016 and 25 July 2016 the Applicant attempted personal service on the Respondent at his home address nine times.
In August 2016 the Respondent ceased paying child support.
On 16 August 2016 the matter was listed for first return, the Respondent did not appear and the Court ordered substituted service on the Respondent.
On 24 August 2016 substituted service was affected by the Applicant’s solicitors.
On 21 – 22 September 2016 the Child Support Agency advised the Applicant that she was to receive $475 per month in child support in accordance with the new Child Support Assessment.
On 27 October 2016 the matter was listed for directions, the Respondent did not appear and the matter was set down for undefended hearing.
On 3 November 2016 the Applicant filed an Amended Initiating Application, such application being served on the Respondent in accordance with the substituted service order made on 16 August 2016.
On 21 December 2016 the matter was listed for a compliance check on which date the Respondent appeared in person at Court. Consent orders for disclosure to occur were made together with filing directions. The matter was set down for possible undefended hearing on 3 March 2017.
As at 14 February 2017 the outstanding amount of child support owed to the Applicant was $3,111.04.
On 3 March 2017 the matter proceeded to undefended hearing.
Parenting
The children, notwithstanding the parties’ separation, have a close and beneficial relationship with both of their parents. The Court finds that the children will benefit from continuing that relationship. The Applicant has always been the children’s primary carer, and will continue to be so. The children are 13 and 11 years old. They had been spending time with the Respondent in accordance with an arrangement reached between the parties from time to time. That arrangement essentially saw the children most recently spending alternate weekends with their father. The children appear to be doing well at school, socially and academically. They are by all accounts well-adjusted and thriving despite their parent’s separation.
There are no allegations of family violence or other significant risks to the children.
The Court accepts that the children wish to continue spending time with the Respondent.
The Respondent has not participated in these proceedings. He has failed to engage. The Court is completely unaware of what, if any orders, the Respondent might consider to be in the children’s best interest. Despite the Respondent’s refusal to engage in the proceedings, the Applicant still submits that it is in the children’s best interest to spend time with the Respondent each alternate weekend and half of all school holidays. Such application shows not only significant insight into the children’s best interests by the Applicant but also a responsible attitude to parenthood and to the children.
The Applicant has actively supported the children’s physical and emotional needs after separation. She is responsible for meeting their day to day needs, even without the financial support of the Respondent who since August 2016 has not paid any child support.
While there were some issues initially about the Respondent’s ability to care for the children adequately, those issues have resolved. These related to the children having appropriate bedding at the Respondent’s residence. Even while that was not the case, the children’s time with the Respondent was still being facilitated by the Applicant, albeit it did not include any overnight time.
The Court is satisfied that the Applicant has demonstrated that she has to date facilitated a relationship between the children and the Respondent, and that she will continue to do so.
Lastly, it should be said that the Court finds that the Respondent’s failure to engage in these proceedings demonstrates that it is unlikely that further proceedings between the parties will be instituted, particularly noting that the orders as sought by the Applicant do not propose any significant change from the status quo regarding the parenting arrangements.
For all of these reasons, the Court finds that the orders as set out at the forefront of these Reasons are in the children’s best interest.
Property
The overall approach to the determination of an application for property adjustment orders pursuant to s.79 Family Law Act1975 (Cth) was set out by the High Court in Stanford v Stanford,[1] where their Honours stated:
[1] [2012] HCA 52; (2012) 247 CLR 108
[37] … first, it is necessary to begin consideration of whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property… the question posed by s 79(2) is thus whether, having regard to those existing interests, the court is satisfied that it is just and equitable to make a property settlement order.
…
[40]… whether making a property settlement order is ‘just and equitable’ is not to be answered by beginning from the assumption that one or other party has the right to have the property of the parties divided between them or has the right to an interest in marital property which is fixed by reference to the various matters (including financial and other contributions) set out in s 79(4) …
Such approach was subsequently considered by the Full Court of the Family Court in Bevan & Bevan[2], Chapman & Chapman[3] and Scott & Danton[4].
[2] [2014] FamCAFC 19
[3] [2014] FamCAFC 91
[4] [2014] FamCAFC 203
In many matters which come before this Court, the requirement of whether it is just and equitable to make any orders is readily satisfied by the fact of the parties’ separation; as there is not and will not thereafter be the common use of property by the parties.
In this matter, the parties’ major asset is the funds held in trust on behalf of the parties, those funds being held since December 2013. Neither party may access that money separately. In all of the circumstances it is just and equitable to make an order adjusting the property interests of the parties.
Once the issue of whether it is just and equitable to make any order is resolved, the Court is to then consider the contributions made by the parties as defined in s.79(4)(a) to (c), the matters set out in s.79(4)(d) to (g) and in particular the subjective considerations as to the parties by having regard to the provisions of s.75(2) in so far as they are relevant.
The Court is then to consider the justice and equity of the actual orders to be made, in the context of the Court’s obligations to make appropriate orders as provided for in s.79(1) of the Act.[5]
[5] see generally Russell & Russell (1999) FLC 92-877; Teal & Teal [2010] FamCAFC 120
The just and equitable requirement is “one permeating the entire process”[6].
[6] Bevan supra at [86]
The relevant facts have been referred to earlier in these Reasons.
Neither party had any significant assets at the commencement of their relationship.
During the periods she was employed early in the parties’ relationship, the Applicant contributed her earnings towards mortgage repayments. From 2007, when she again returned to paid employment, the Applicant’s earnings were applied towards family expenses.
The Applicant made significant non-financial contributions within the meaning of s79(4)(b), being the general upkeep of the properties and the assistance of her parents towards improvements of the property located at Property F.
It was the Applicant who was the primary carer for the children during the relationship and also post separation. During the relationship, the Applicant was responsible for most of the day to day tasks associated with the care of the children, while the Respondent assisted with some of those tasks in the evenings.
During the relationship, the Respondent received an inheritance of some $150,000 to $200,000 which was originally applied towards the mortgage of the parties’ then matrimonial home, but later withdrawn and otherwise invested by the Respondent. Because of a complete lack of evidence in the father’s case, there is no information in respect of how these funds were then utilised by the Respondent and whether they are still in existence.
The Respondent operated a number of businesses during the relationship, and made contributions both of a financial and non-financial nature within the meaning of s.79(4). The extent of those contributions is only apparent from the evidence of the wife.
Both parties are in good health. The Applicant is employed on a part-time basis and her income varies. The Respondent is in arrears in respect of child support in the amount of $3,111.04 as at 14 February 2017. The reasons for this are not known as the Respondent has chosen not to participate in the proceedings.
The Applicant will pursuant to these orders, remain the primary carer of the children, who are 13 and 11 years old. The children will remain spending time with the Respondent on alternate weekends pursuant to these orders. It is therefore the Applicant who will have the primary burden of supporting the children, particularly noting that the Respondent is currently not paying child support and is in arrears.
The Applicant has been living with the children in her parent’s home. The submission made on behalf of the Applicant that the orders which are sought will enable the Applicant to have a standard of living similar to what the parties enjoyed prior to separation, are accepted. The distribution to the Applicant in accordance with these orders will provide a significant financial resource which will permit her to improve on her current standard of living.
The Court finds that the overall contributions by the Applicant were greater than those by the Respondent, particularly noting the significant post separation contributions towards the welfare of the family. Furthermore, the Court finds that a significant adjustment pursuant to s.75(2) factors is warranted on all of the evidence.
The Applicant submits that an order for her to receive the entire proceeds of sale of the former matrimonial home, and for the parties to otherwise retain all other assets and superannuation interests held in their names, is an order which is in all of the circumstances just and equitable. The Applicant submits that as a result of the Respondent’s failure to engage in the proceedings, the Court is not able to ascertain the complete asset pool, namely: the Respondent’s superannuation interests, any beneficial ownership by the Respondent of a home unit in Auburn, the Respondent’s current interests in bank accounts and motor vehicles. The Court accepts those submissions for reasons outlined below.
The authorities have long recognised that it is the duty of a party involved in property proceedings in this jurisdiction to make full and frank disclosure of their financial affairs.[7]
[7] Black & Kellner (1992) FLC 92-287
In Weir & Weir[8] the Full Court held that where there is clear evidence of non-disclosure, the Court should not be unduly cautious about making orders in favour of the other party:
…failure to disclose undermines the whole process of adjudication of proceedings for a settlement of property in that the Court is unable to identify the property of the parties, to properly assess contributions or to properly assess s75(2) factors.”
[8] (1993) FLC 92-338 at [45]
While at first blush the orders which the Applicant seeks appear to be for a property adjustment order of 100% in her favour, this is in fact not the case. The Applicant is seeking orders for each of the parties to retain the assets which are in their possession, custody or control in addition to an order that she receive the funds held on trust being the sale proceeds of the former matrimonial home.
Furthermore, accepting the Applicant’s evidence at its highest, which the Court does, not only because the proceedings were undefended by virtue of the Respondent failing to engage but because the Court has formed the view that the Applicant has done her best to put all relevant matters before the Court as far as they are within her knowledge, the Respondent may in fact hold some significant investments and an interest in a property.
For all of these reasons, the Court is not overly cautious about making orders in favour of the Applicant. The result in all the circumstances is appropriate and just and equitable. Orders will thus be made accordingly as set out at the forefront of these Reasons for Judgment.
I certify that the preceding seventy-two (72) paragraphs are a true copy of the reasons for judgment of Judge Obradovic
Date: 31 March 2017
Key Legal Topics
Areas of Law
-
Family Law
-
Equity & Trusts
Legal Concepts
-
Jurisdiction
-
Remedies
-
Costs
-
Statutory Construction
0
6
2