Northey and Claughton (No.2) - [2014] FCCA 1832

FEDERAL CIRCUIT COURT OF AUSTRALIA

NORTHEY & CLAUGHTON (No.2)

[2014] FCCA 1832

Catchwords:
FAMILY LAW – Ruling on form of orders.

Legislation:

Family Law Act 1975 (Cth)

Applicant:

MS NORTHEY

Respondent:

MR CLAUGHTON

File Number:

MLC 8359 of 2012

Judgment of:

Judge Burchardt

Hearing date:

17 July 2014

Date of Last Submission:

17 July 2014

Delivered at:

Melbourne

Delivered on:

17 July 2014

REPRESENTATION

Counsel for the Applicant:

Mr Serra

Solicitors for the Applicant:

O’Farrell Robertson McMahon

Counsel for the Respondent:

Ms Tulloch

Solicitors for the Respondent:

J A Middlemis

ORDERS

(Amended pursuant to Rule 16.05(2)(e) of the Federal Circuit Court Rules 2001 on 14 August 2014).

THE COURT ORDERS THAT:

~~Interim property associated orders are made in accordance with orders 21-26 and~~ Final property associated orders are made in accordance with orders 1-20 and 27-30 of the attached minutes of orders placed on the Court file.
The matter be adjourned to this Court for mention before Judge Burchardt on 21 August 2014 at 9.30 am.

THE COURT DIRECTS THAT:

The solicitors for the Applicant file by email the engrossed orders in this matter in Word format to the Court within 7 days.

THE COURT NOTES THAT:

A. Final property associated orders will be made in accordance with orders 21-26 of the minutes of orders placed on the Court file after procedural fairness has been afforded to the relevant superannuation funds.

MINUTE

That the Husband and the Wife forthwith do all such acts and things and sign all such documents necessary to effect a sale of the following real properties ("the sales"):
(a)Situate at and known as Property M in the State of New South Wales ("(omitted)").
(b)Situate at and known as Property N in the State of Victoria ("Property N") consisting of approximately 13 acres being the land more particularly described in Certificate of Title Volume (omitted) Folio (omitted).
(c)Situate Property C and Property N in the State of Victoria consisting of approximately 40 to 45 acres known as the "Property C" (“Property C”) being the land more particularly described in Certificate of Title Volume (omitted) Folio (omitted).
That the sales be conducted on the following terms:
(a)By the following licensed real estate agents:
(i)(omitted) Real Estate Agent for Property M; and
(ii) (omitted) for Property N and the Property C;
or such other agents as may be agreed between the parties.
(b)At the following advertised prices to be lowered only on the recommendation of the estate agents and with the agreement of the parties:
(i)     Property M $170,000.
(ii)    Property N $240,000.
(iii)     Property C $60,000.
(c)On an unconditional Real Estate Institute Contract of Sale or as determined by the estate agents with the agreement of the parties.
(d)The parties do all such acts and things and sign all such documents necessary to give effect to the above sales including co-operating with any reasonable request of the estate agents including making keys available, allowing inspection of any dwelling at times requested by the agent ensuring that the dwelling…

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 Northey and Claughton (No.2)

Details

AGLC: Northey and Claughton (No.2) [2014] FCCA 1832
Case: [2014] FCCA 1832
Decision Date: 17 July 2014

CaseChat Overview and Summary

This matter concerned property adjustment orders made by Judge Burchardt of the Federal Circuit Court. The dispute involved the division of various assets between the Husband and the Wife, including multiple real properties, a partnership, and other personal and financial interests.

The court was required to determine the terms of the sale and distribution of proceeds from several real properties, the payment of a significant sum from the Husband to the Wife, and the dissolution and transfer of a partnership. Additionally, the court needed to address the allocation of specific assets such as motor vehicles and shareholdings, and the respective liabilities and indemnities of each party concerning these assets and the partnership.

The court made final property adjustment orders, detailing the sale of specified real properties, the application of sale proceeds, and a substantial payment to be made by the Husband to the Wife, subject to certain deductions and adjustments. These orders also provided for the dissolution of the parties' partnership, with the Husband to receive the Wife's interest and indemnify her against all liabilities arising from it. The court also allocated various other assets and liabilities between the parties, including motor vehicles, shareholdings, and superannuation entitlements, and severed any joint tenancies. Liberty to apply was reserved.

Orders

Orders of the court

(Amended pursuant to Rule 16.05(2)(e) of the Federal Circuit Court Rules 2001 on 14 August 2014).

THE COURT ORDERS THAT:

Interim property associated orders are made in accordance with orders 21-26 and Final property associated orders are made in accordance with orders 1-20 and 27-30 of the attached minutes of orders placed on the Court file.

The matter be adjourned to this Court for mention before Judge Burchardt on 21 August 2014 at 9.30 am.

THE COURT DIRECTS THAT:

The solicitors for the Applicant file by email the engrossed orders in this matter in Word format to the Court within 7 days.

THE COURT NOTES THAT:

MINUTE

That the Husband and the Wife forthwith do all such acts and things and sign all such documents necessary to effect a sale of the following real properties ("the sales"):

(a) Situate at and known as Property M in the State of New South Wales ("(omitted)").

(b) Situate at and known as Property N in the State of Victoria ("Property N") consisting of approximately 13 acres being the land more particularly described in Certificate of Title Volume (omitted) Folio (omitted).

(c) Situate Property C and Property N in the State of Victoria consisting of approximately 40 to 45 acres known as the "Property C" (“Property C”) being the land more particularly described in Certificate of Title Volume (omitted) Folio (omitted).

That the sales be conducted on the following terms:

(a) By the following licensed real estate agents:

(i) (omitted) Real Estate Agent for Property M; and

(ii) (omitted) for Property N and the Property C;

or such other agents as may be agreed between the parties.

(b) At the following advertised prices to be lowered only on the recommendation of the estate agents and with the agreement of the parties:

(i) Property M $170,000.

(ii) Property N $240,000.

(iii) Property C $60,000.

(c) On an unconditional Real Estate Institute Contract of Sale or as determined by the estate agents with the agreement of the parties.

(d) The parties do all such acts and things and sign all such documents necessary to give effect to the above sales including co-operating with any reasonable request of the estate agents including making keys available, allowing inspection of any dwelling at times requested by the agent ensuring that the dwelling and ensuring any garden is in neat and clean condition at the time of inspection and/or auction.

That in the event of any of the said real properties failing to sell by way of a binding Contract of Sale within 90 days from the date of these Orders, then the real properties be sold by way of a public auction within a further 30 days (being a total of 120 days) from the date of these Orders on terms and conditions as recommended by the estate agent, save that there shall be no reserve price for any of the real properties.

That upon settlement of the sale of each of the said real properties, the proceeds of sale be applied as follows:

(a) Firstly to pay all costs, commissions and expenses of the sale including the estate agent's costs, conveyancing costs and any necessary disbursements.

(b) Secondly to pay any council and water rates and maintenance levies outstanding in respect of the real properties.

(d) Fourthly, the balance to the Wife.

That pending the settlement of the sale of each of the real properties:

(a) The Husband have the sole right to occupy the real properties. During such right of occupation the Husband pay all instalments pursuant to any mortgage and all rates, taxes and like apportionable outgoings of or with respect to each real property as they fall due save that for Property M, both parties have the equal right to occupy that property and be entitled to 50% of any rent or income generated from that property and contribute equally to the mortgage repayments.

(b) That the parties hold their respective interests in the real properties on trust pursuant to these Orders.

(d) That liberty be reserved to each party to apply with respect to the terms and conditions of and execution of the sales.

That the Husband make payment to the Wife ("the payment") the following sum:

(a) $600,361.40 less:

(i) The proceeds received by the Wife pursuant to paragraph 4(d).

(ii) 50% of the sale costs of each property sold pursuant to paragraph 4(a).

(iii) 50% of the outstanding council and water rates and maintenance levies in respect of each of the real properties sold pursuant to paragraph 4(b) save that the Husband be responsible for any council and water rates and maintenance levies which should have been paid pursuant to notices prior to the sale.

(iv) 50% of any Capital Gains Tax liability of the Husband in respect of the sale of the real properties in his sole name.

(v) 35% of any deficiency between the sale price and the following sale prices:

A. Property M $200,000.

B. Property N $237,500.

C. Property C $60,000.

D. Property O $572,500 (in the event of default sales).

E. Property H $309,500 (in the event of default sales).

F. Property F $247,000 (in the event of default sales).

Plus:

(i) 35% of any increase between the sale price of the real properties and the following values:

A. Property M $200,000.

B. Property N $237,500.

C. Property C $60,000.

D. Property O $572,500 (in the event of default sales).

E. Property H $309,500 (in the event of default sales).

F. Property F $247,000 (in the event of default sales).

The payment to be made within 7 days of the date settlement of the last of the properties referred to in paragraph 1 of these Orders (“the first date”).

In the alternative to paragraph 7 of these orders and in the event that all or any of the properties referred to in paragraph 1 of these Orders fail to sell by unreserved public auction pursuant to paragraph 3 of these orders the husband to pay to the wife within a further 60 days (being a total of 180 days) from the date of these Orders (“the second date”) such of the payment which remains outstanding.

That if the payment has not been made in full by:

(a) The first date, if paragraph 8 does not take effect, interest shall accrue at the rate prescribed by the Family Law Rules 2004 from the first date; or

(b) The second date, if paragraph 8 does take effect, interest shall accrue at the rate prescribed by the Family Law Rules 2004 from the second date.

10.

In the event of the Husband failing to make the payment referred to in paragraph 7 by the first date or the payment referred to in paragraph 8 by the second date, the Husband and the Wife shall do all things necessary including signing all necessary documents to forthwith sell the following real properties:

(a) Property M;

(b) Property N;

(d) Situate at and known as Property O known as the "Property O" (“Property O”) being the land more particularly described in Certificate of Title Volume (omitted) Folio (omitted);

(e) Situate at Property O known as the "Property H" (“Property H”) being the land more particularly described in Certificates of Title Volume (omitted) Folio (omitted) , Volume (omitted) Folio (omitted) and Volume (omitted) Folio (omitted); and

(f) Approximately 195 acres known as the "Property F" (“Property F”) being the land more particularly described in Certificates of Title Volume (omitted) Folio (omitted) and Volume (omitted) Folio (omitted).

11.

That the properties referred to in paragraph 10 be sold ("the default sales") on the following terms:

(a) By a licensed real estate agent agreed between the parties and in default of agreement to be appointed by the President of the Real Estate Institute of Victoria.

(b) At an advertised price as agreed between the parties and in default of agreement to be determined by a valuer to be appointed by the President of the Real Estate Institute of Victoria.

(d) The Husband and the Wife shall do all such acts and sign all such documents necessary to effect the default sales including co-operating with any reasonable request of the estate agent including making keys available, allowing inspection of the properties at times requested by the agent ensuring the properties are in neat and clean condition at the time of inspection and/or auction.

12.

Upon completion of the default sales, whichever property or properties sells first, the proceeds be applied as follows:

(a) Firstly, to pay all costs, commissions and expenses of the sales including the estate agent's costs, the conveyancing costs and any necessary disbursements.

(b) Secondly, to pay any council and water rates and maintenance levies outstanding in respect to the real properties.

(d) Fourthly, to pay the Wife so much of the payment as is then outstanding including accrued interest.

(e) Fifthly, the balance to the Husband.

13.

That pending the default sales referred to in paragraph 10:

(b) The parties hold their respective interests in the real properties on trust pursuant to these Orders.

(d) That there be liberty to apply to either party with respect to the terms and conditions of the sale of the real properties.

14.

That on or before 60 days from the date of these Orders, the Husband and the Wife sign all documents and do all things necessary to transfer to the Husband, at the expense of the Husband, the following:

(a) The parties’ joint timeshare interest in (omitted).

(b) The 1000 (omitted) Ltd shares.

15.

That Husband and the Wife’s partnership known as Mr Claughton & Ms Northey (“the partnership”) be dissolved as at 30 June 2013 (in the event that the partnership has not already been dissolved).

16.

That the Wife do all such acts and things and sign all such documents as may be required to transfer her right, title and interest in the partnership to the Husband (“the partnership transfer”).

17.

That pending the partnership transfer, the Husband shall be solely entitled to the exclusion of the Wife to all income of the said partnership.

18.

That the Husband indemnify the Wife and hold her secure against all costs, claims, demands and liabilities of whatsoever nature and kind (inclusive of any taxation liabilities, fines, penalties or interest) past, present or future arising out of the Wife’s involvement in any capacity in the partnership.

19.

That the Wife retain to the exclusion of the Husband the Mazda motor vehicle subject to the loan with Mazda Finance.

20.

That the Husband retain to the exclusion of the Wife:

(a) His (omitted) shareholdings.

(b) His (omitted) shareholdings.

(d) (Stock omitted).

(e) Farm plant and equipment.

(f) His (omitted) superannuation.

THE COURT NOTES THAT:

Final property associated orders will be made in accordance with orders 21-26 of the minutes of orders placed on the Court file after procedural fairness has been afforded to the relevant superannuation funds.

29.

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) That the Husband and the Wife be entitled to be the sole legal and beneficial owners of all items of property including money, motor vehicles, shares, equities, superannuation entitlements and personal effects currently in the possession or control of each of them respectively.

(b) That each of the Husband and the Wife retain absolutely any superannuation benefits, long service leave, sickness payments or other employment entitlements belonging to or earned by them.

(c) Money standing to the credit of the parties in any joint bank account is to be divided equally between the Husband and the Wife.

(d) All insurance policies to become the sole property of the life assured named thereon/in.

(e) Each of the Husband and the Wife to be solely liable for and indemnify the other against any liability encumbering any item or property to which that party is entitled pursuant to these Orders.

(f) Any joint tenancy of the Husband and the Wife in any real or personal estate is hereby expressly severed.

(g) Each of the Husband and the Wife foregoes any claim they may have to any inheritances to which the other is entitled to either presently or in the future.

30.

Reserve general liberty to apply and in particular in relation to the enforcement of these Orders.

31.

That the Wife’s Application and the Husband’s Response for Property Orders be otherwise dismissed.

32.

Certify for Advocacy.

Background

Background to the litigation

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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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