Nelson and Ashcroft - [2016] FCCA 1322

FEDERAL CIRCUIT COURT OF AUSTRALIA

NELSON & ASHCROFT

[2016] FCCA 1322

Catchwords:
FAMILY LAW – Property – De facto relationship – where the relationship is short – where one party has sustained serious physical and psychological injuries as a result of a workplace accident just prior to the commencement of cohabitation – where the other party has provided care and support during the period of the relationship and that provision of care and support has placed some restriction upon that party’s full employment during the relationship – where compensation has been paid pursuant to a statutory entitlement and the amount received by the injured party has been increased as a result of an acceptance that the children of the other party properly constitute dependents or an eligible young person for the purposes of any calculation of compensation – where the injured party has to some extent dissipated the compensation received reducing the pool available for distribution to the parties – where future needs of the injured party must be balanced against the positive future prospects of the other party – where adjustments must be considered in respect of financial and non-financial contributions as well as in light of future prospects.

Legislation:

Military Rehabilitation & Compensation Act 2004, ss.15, 17, 80

Family Law Act 1975 (Cth), ss.4aa. 75(2), 79(2) & (4), 90SF(3), 90SM(3) & (4)

Cases cited:
James and James (1984) FLC 91-537
Kostov & Kuslev [2008] FMCAfam 757
Griffiths v Kerkemeyer
Wrona v Wrona (Unreported, Family Court of Australia, Finn J, 17 December 2004)
Pastrikos and Pastrikos (1980) FLC 91-987
In the Marriage ofLee Steere (1985) FLC 91-626
In the Marriage of Ferraro (1993) FLC 92-335
In the Marriage ofClauson (1995) FLC 92-595
In the marriage of Whitely (1996) FLC 92-684)
Russell v Russell (1999) FLC 92-877

Hobbs & Valonz [2013] FCCA 1999
Erdem & Ozsoy [2012] FMCAfam 1323

Stanford and Stanford Lots of Questions – Very Few Answers, Martin Barfeld QC of the Victorian Bar

Australian Family Law Practice Handbook

Applicant:

MR NELSON (BY HIS LITIGATION GUARDIAN MR C NELSON)

Respondent:

MS ASHCROFT

File Number:

CSC 453 of 2015

Judgment of:

Judge Coker

Hearing date:

6 May 2016

Date of Last Submission:

6 May 2016

Delivered at:

Townsville

Delivered on:

2 June 2016

REPRESENTATION

Counsel for the Applicant:

Mr Victoire

Solicitors for the Applicant:

Williams Graham Carman

Solicitors for the Respondent:

Mellick Smith & Associates

ORDERS

That the Applicant and the Respondent forthwith do all acts and things and sign all necessary documents to effect a sale of the property situate at Property M and known as Lot (omitted) on Registered Plan (omitted), County of (omitted), Parish of (omitted) being the whole of the land more particularly described in Certificate of Title Reference (omitted) (“the Property M property”) and by way of consequential arrangement that shall be made for the purposes of effecting a sale:
(a)The listing price for the real property shall be as agreed between the parties and if there is no agreement the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Nelson and Ashcroft

Details

AGLC: Nelson and Ashcroft [2016] FCCA 1322
Case: [2016] FCCA 1322
Decision Date: 2 June 2016

CaseChat Overview and Summary

This case involved orders made by Judge Coker concerning the division of property between an applicant and a respondent. The dispute centred on the sale of two properties, Property M and Property C, and the distribution of the proceeds, as well as the allocation of various other assets and liabilities. The court was required to make detailed orders to facilitate the sale of these properties and to determine how the net proceeds would be applied, including specific formulas for calculating payments to the respondent and the discharge of a mortgage.

The court was required to determine the terms and conditions under which Property M would be sold, including provisions for sale by private treaty and, if unsuccessful, by public auction, with specified timelines and mechanisms for agreeing on listing prices, agents, and auctioneers. It also had to determine the terms for a potential second auction if the property remained unsold after the first. Furthermore, the court needed to establish the order of priority for the distribution of sale proceeds from Property M, including the payment of sale costs, rates, and a calculated sum to the respondent, with the balance to be applied towards a mortgage on Property C. The court also had to make consequential orders regarding the transfer of Property C to the applicant, contingent on the applicant indemnifying the respondent against liabilities associated with that property. If the applicant could not meet these indemnification requirements, Property C was also to be sold under similar terms to Property M, with specific provisions for the distribution of its sale proceeds.

The court's reasoning and the legal principles applied are reflected in the detailed orders made. These orders establish a clear framework for the sale of both properties, including default mechanisms for appointing valuers, agents, and auctioneers should the parties fail to agree. The formulas for distributing the proceeds from Property M demonstrate an attempt to achieve an equitable division, taking into account the initial capital and the respondent's entitlement. The conditional transfer of Property C, coupled with the applicant's indemnification obligations, addresses the complexities of managing and discharging existing debts. The court also made specific orders regarding the retention of other assets, such as bank accounts, superannuation, and personal belongings, by each party, and included general provisions for the preparation of documentation, payment of duties, and the final determination of the parties' financial relationship. The inclusion of a default provision appointing the Registrar of the Family Court to execute documents underscores the court's intention to ensure the orders were effectively implemented.

Orders

Orders of the court

That the Applicant and the Respondent forthwith do all acts and things and sign all necessary documents to effect a sale of the property situate at Property M and known as Lot (omitted) on Registered Plan (omitted), County of (omitted), Parish of (omitted) being the whole of the land more particularly described in Certificate of Title Reference (omitted) (“the Property M property”) and by way of consequential arrangement that shall be made for the purposes of effecting a sale:

(a) The listing price for the real property shall be as agreed between the parties and if there is no agreement the listing price shall be as advised by a valuer nominated by the President of the Queensland Law Society.

(b) The real property shall be listed for sale by private treaty with an agent and the agent shall be as agreed between the parties and if there is no agreement the agent shall be as nominated by the President of the Queensland Law Society.

In the event that the real property has not been sold by or before a date three (3) months from the date of these orders then the Applicant and the Respondent shall make all such arrangements and do all such acts and sign all such documents and pay all moneys equally necessary to procure a sale by public auction of the real property by the following terms:

(a) The auctioneer shall be as agreed between the parties and if there is no agreement the auctioneer shall be as nominated by the President of the Queensland Law Society;

(b) The auction shall take place by two (2) months after the deadline date for sale by private treaty;

(d) The Applicant and the Respondent shall each pay and be responsible for payment of one-half of auction expenses payable before the real property is auctioned.

In the event that the property is not so sold by auction or by private negotiation within fourteen (14) days after the said auction then the Applicant and the Respondent do all such acts and sign all necessary documents and shall pay all moneys equally necessary to procure a second auction within a further six (6) weeks of that date otherwise upon the same terms and conditions as applied to the first auction.

Upon completion of the sale the proceeds of the sale be applied as follows:

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

(b) Secondly, and subject to the Applicant being able to comply with paragraph 5(b) below, to pay to the Respondent the sum calculated by reference to the following formula:

a = [($287,244 + b) x 25%] - $14,500

where

a = the amount to be paid to the Respondent

b = the proceeds of sale after payment of the amounts returned in paragraph 4(a) above.

(c) Thirdly, or if the Applicant is not able to comply with paragraph 5(b) below, the balance to be paid by way of reduction of the debt owing with respect to the mortgage number (omitted) registered against the real property situated at Property C and known as Lot (omitted) on Survey Plan (omitted), County of (omitted), Parish of (omitted), being the whole of the land more particularly described and certified as Title Reference (omitted) (“the Property C property”).

That contemporaneously with the distribution of the proceeds of sale referred to in paragraph 4 above:

(a) And subject to the Applicant being able to comply with paragraph 5(b) below, the Respondent do all such acts and things and sign all such documents as may be required to transfer to the Applicant at the expense of the Applicant all of her right title and interest in the Property C property; and

(b) The Applicant shall indemnify the Respondent against and cause her to be discharged from any liability pursuant to the (omitted) Bank Mortgage No. (omitted) and any liabilities for all rates, taxes and outgoings of or with respect to the real property of whatsoever nature and kind.

In the event that the Respondent is not able to comply with paragraphs 5(b) above, the Applicant and the Respondent forthwith do all acts and things and sign all necessary documents to effect a sale of the Property C property and by way of consequential arrangement that shall be made for the purposes of effecting a sale:

(a) The auctioneer shall be as agreed between the parties and if there is no agreement the auctioneer shall be as nominated by the President of the Queensland Law Society;

(b) The auction shall take place by two (2) months after the deadline date for sale by private treaty;

(d) The Applicant and the Respondent shall each pay and be responsible for payment of one-half of auction expenses payable before the real property is auctioned.

Upon completion of the sale the proceeds of the sale be applied as follows:

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

(b) Secondly, to discharge the (omitted) Bank mortgage number (omitted) registered against the Property C property;

a = [($16,244 + b + c) x 25%] - $14,500

where

a = the amount to be paid to the Respondent

b = the proceeds of sale of the Property M property after payment of the amounts returned in paragraph 4(a) above.

c = the proceeds of sale of the Property C property after payment of the amounts referred to in paragraph 9(a) and 9(b) above.

(d) Fourthly, the balance to be paid to the Applicant.

10.

That within fourteen (14) days from the date of these Orders, the Respondent do all acts and things and sign all documents required to transfer to the Applicant all of her right, title and interest in the joint (omitted) Bank Account (Account Number (omitted)).

11.

That the Applicant shall retain sole beneficial ownership as against the Respondent of the following:

(a) His bank accounts;

(b) His superannuation; and

12.

That the Respondent shall retain sole beneficial ownership as against the Applicant of the following:

(a) (omitted) Mazda;

(b) Her bank accounts;

(d) Her jewellery; and

(e) The furniture and household items in the Respondent’s possession as at the date of these Orders.

General Orders

13.

Unless otherwise provided for in these Orders, the transferee spouse or the spouse receiving the benefit of any transaction pursuant to these Orders, will prepare the documentation necessary to give effect to the provisions of these Orders at their costs and further be responsible for payment of registration fees and all other fees in relation to the transfer of the property assets to their names.

14.

That unless otherwise provided for in these Orders, that any duty payable on transactions arising from these Orders, or any documents executed pursuant to these Orders be paid by the transferee spouse or the spouse receiving the benefit of such transfer or transaction.

15.

That the parties do all acts and sign all documents required to implement these Orders.

16.

That unless otherwise specified in these Orders and except for the purposes of enforcing the payment of any money due under these or any subsequent Orders:

(a) Each party be solely entitled to the exclusion of the other party to all property in the possession of such party as at this date;

(b) Each party hereby forgoes any claim they may have to any superannuation benefits belonging to or earned by the other;

(d) 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.

Default

17.

That if either party refuses or neglects to sign (within 14 days of a written request to do so) any documents necessary to give effect to these terms of these Orders the Registrar of the Family Court of Australia at Cairns is hereby appointed pursuant to the provisions of section 106A of the Family Law Act 1975 to execute such documents on behalf of such party.

Notation

A. The parties intend that, pursuant to the terms of Section 81 of the Family Law Act 1975 (as amended), these Orders shall, as far as practicable, finally determine the financial relationship between them and avoid further proceedings.

Background

Background to the litigation

In that respect, it was also indeed most appropriate that the parties were able to agree on a set of facts in relation to what was the basis for the relationship. The agreed facts were in these terms:7. Agreed Facts8. Background9. 1. The Applicant is 44 years of age (born (omitted)/1972). He is a pensioner.10. 2. The Respondent is 43 years of age (born (omitted)/1972). She works as an (occupation omitted) with (employer omitted).11. 3. The Applicant has 2 children from 2 previous relationships: X aged 10 (born (omitted)/2005) and Y aged 5 (born (omitted)/2010), from previous relationships. They live with their mothers. The Applicant pays child support for the children.12. 4. The Respondent has 3 children from a previous relationship: A aged 19 (born (omitted)/1996), B aged 16 (born (omitted)/99) and C aged 12 (born (omitted)/2004).13. Cohabitation period14. 5. The parties entered in a defacto relationship in early October 2012 and separated in November 2014, a period of 2 years and 1 month.15. Applicant’s accident & impact16. 6. On (omitted)/2012, shortly before cohabitation the applicant, who was a (occupation omitted) with the (employer omitted), had a workplace accident.17. 7. His injuries are permanent and he was medically discharged from the (employer omitted) in May 2013. He is not capable of returning to the workforce.18. 8. The Applicant has been diagnosed with Interstitial Lung Disease, Depression, PTSD, Alcohol abuse/Dependence, Panic Disorder, Agoraphobia, Acquired brain injury with global cognitive deficits. He has difficulty controlling his behaviour.19. 9. The Respondent was diagnosed with secondary PTSD and received counselling through the Department of Veteran Affairs (DVA).20. Contributions at cohabitation21. 10. At cohabitation the Applicant had assets totalling $32,500 and superannuation of $67,852. His assets included a fully mortgage property at Property W.22. 11. The Respondent had assets totalling $129,000 (including cash of $100,000) and superannuation of $200,000.23. 12. The Applicant was an (occupation omitted) on a wage of $1,350 per week. The Respondent was on a wage of $820 per week nett.24. Respondent’s Children25. 13. During the relationship, A lived with the Respondent’s mother and spent time at the home of the parties. B lived with her father but spent every second weekend with the parties. C lived with the parties and spent weekends with his father.26. 14. The Respondent deposes that her eldest child lived with her mother most of the time whilst the two younger children were in her full time care and spent every second weekend with their father.27. 15. The parties agreed that the precise living arrangements for the Respondent’s children do not need to be resolved.28. Contributions during cohabitation29. 16. The Respondent was the primary homemaker. She was supportive of the Applicant and took the Applicant to his medical appointments.30. 17. In August 2013, the parties received assistance from DVA with a gardener and a cleaner on a fortnightly basis and a pool maintenance person each month.31. Compensation DVA32. 18. On 03/02/2014, the Applicant received compensation for permanent impairment of $378,032 from the Department of Veteran Affairs for his injuries. He had reached the requisite number of impairment points to receive the maximum compensation payment.33. 19. On 09/04/2014, he received $406,837 being 5 payments of $81,367 for each of the five children who were deemed to be both the Applicant’s dependents and eligible young persons under the Military Rehabilitation and Compensation Act. The amount referable to the Applicant’s 2 children was $162,734. The amount referable to the Respondent’s 3 children was $244,101.34. 20. Income during cohabitation.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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