Oldfield & Oldfield

[2021] FamCA 3

FAMILY COURT OF AUSTRALIA

Oldfield & Oldfield [2021] FamCA 3

File number(s):	MLC12254/2020
Judgment of:	HARTNETT J
Date of judgment:	15 January 2021
Catchwords:	FAMILY LAW – PROPERTY – interim application – sale of assets – where each party seeks orders in relation to the sale of three properties – where neither party is able to retain the properties – where the parties disagree as to the order of sale of the properties – where assets need to be sold for the parties to acquire funds – where the Respondent opposes the selling agent proposed by the Applicant – orders made for the properties to be sold together by the selling agent proposed by the Applicant – orders made for sale of chattels.
Number of paragraphs:	25
Date of hearing:	15 December 2020
Place:	Melbourne
Counsel for the Applicant:	Mr Dickson QC
Solicitor for the Applicant:	Coote Family Lawyers
Counsel for the Respondent:	Dr Ingleby
Solicitor for the Respondent:	Lander & Rogers

ORDERS

MLC12254/2020

BETWEEN:

MR OLDFIELD
Applicant

AND:

MS OLDFIELD

Respondent

ORDER MADE BY:	HARTNETT J
DATE OF ORDER:	15 JANUARY 2021

THE COURT ORDERS THAT:

1.The parties forthwith do all such acts and things and sign all documents necessary to engage B Realtors (Suburb C) to sell the properties situate at and known as H Street Suburb C being the whole of the land more particularly described in Certificate Title Volume … Folio …, Volume … Folio … and Volume … Folio … (H Street), 1 D Street, Suburb C in the State of Victoria being the whole of the land more particularly described in Certificate Title Volume … Folio … (1 D Street) and 2 D Street, Suburb C in the State of Victoria being the whole of the land more particularly described in Certificate Title Volume … Folio … (2 D Street) on such terms and conditions as agreed between the parties save that such sales to be not listed before 1 March 2021. Upon settlement of the sale of each of the properties the proceeds be divided as follows:-

(a)to pay all costs, commissions and expenses associated with the sale, including reimbursing the Applicant for any costs incurred by him in preparing the properties for sale;

(b)to discharge any encumbrance or encumbrances secured against the properties;

(c)to pay the sum of $250,000 to each of the Applicant and Respondent with such payment to be characterised at trial; and

(d)the balance to be held in an interest-bearing trust account established by Coote Family Lawyers pending further orders or written agreement between the parties.

2.Pending settlement of the sale of H Street, 1 D Street and 2 D Street:-

(a)the parties do all such acts and things and sign all documents necessary to facilitate any agreed works required to prepare H Street, 1 D Street and 2 D Street for sale and, in default of agreement in relation to the works required to the property, the works be as recommended by B Realtors;

(b)the Applicant pay the costs of the works required to H Street, 1 D Street and 2 D Street at first instance, with any adjustment as between the parties in respect of these costs to be determined at trial.

3.Within 60 days of the date of the orders, the Respondent do all such acts and things and sign all documents required to withdraw the caveats lodged by her or on her behalf against the following properties:-

(a)H Street;

(b)1 D Street;

(c)2 D Street.

4.At 12.00pm on 22 January 2021, the Applicant be permitted to attend H Street in the presence of the Respondent if she so desires, and in the presence of a third party as agreed between the parties, to collect:-

(a)his personal effects;

(b)Motor Vehicle 1 registration …; and

(c)Motor Vehicle 2 registration ….

It is the responsibility of the Respondent to ensure that the above motor vehicles are on the H Street property and available for collection by the Applicant.

THE COURT ORDERS, BY CONSENT, THAT:

5.Until further order and without admission as to the necessity for this order the Respondent have sole use and occupation of H Street and the Applicant shall do all things and sign all documents necessary to provide the Respondent with sole occupation of H Street, including but not limited to the transfer of all security codes, passwords, documents, authorities and exclusive access to security software installed at the H Street property.

THE COURT ORDERS THAT:

6.Nothing in order 5 herein shall prevent however the operation of order 4 herein and nor shall anything in order 5 herein preclude the Applicant’s ability to access the H Street property in the company of a real estate agent or agents from B Realtors when requested by B Realtors in relation to matters going to the preparation and sale of the property and upon prior notice being provided to the Respondent.

7.By no later than 12.00pm on 29 January 2021, the Applicant make available for collection by the Respondent or her agent personal items belonging to the Respondent and her children situated at the KK House, the storage in JJ Town and the P Street property.

8.The Applicant do all things, and sign all documents necessary, to transfer to the Respondent Motor Vehicle 3 with registration … at the Respondent's expense and by way of part-property settlement.

9.The Applicant do all such acts and things as necessary to forthwith place at his election either Motor Vehicle 1 registration … or Motor Vehicle 2 registration … on the market for sale and the proceeds of sale be applied as follows:-

(a)first, to meet all selling costs and commissions; and

(b)the balance to be paid to the Respondent with such payment to be characterised as spousal maintenance and/or part-property settlement at trial.

In the alternative the Applicant can pay to the Respondent and within 21 days hereof a sum of money as agreed between the parties to represent that which would have otherwise been paid by the Applicant to the Respondent pursuant to the sale as provided for in this order.

Note:   The form of the order is subject to the entry in the Court’s records.

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to 17.02 Family Law Rules 2004 (Cth).

IT IS NOTED that publication of this judgment by this Court under the pseudonym Oldfield & Oldfield has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

REASONS FOR JUDGMENT

HARTNETT J:

1. This proceeding was commenced by the Applicant de facto husband (‘the Applicant’) in his filing of a property orders application on 11 November 2020. The husband amended his Initiating Application on 8 December 2020. In that application, the Applicant sought both final and interim property orders. On the hearing of the matter before me on 15 December 2020 the interim orders sought by the Applicant (as set out in his Amended Initiating Application) included, relevantly, the following:-

   …

   2. The parties forthwith do all such acts and things and sign all documents necessary to engage B Realtors (Suburb C) to sell the properties situate at and known as H Street Suburb C being the whole of the land more particularly in Certificate Title Volume … Folio …, Volume … Folio … and Volume … Folio … (H Street), 1 D Street, Suburb C in the State of Victoria being the whole of the land more particularly in Certificate Title Volume … Folio … (1 D Street) and 2 D Street, Suburb C in the State of Victoria being the whole of the land more particularly in Certificate Title Volume … Folio … (2 D Street) on such terms and conditions as agreed and in default of agreement as recommended by selling agent and upon settlement of the sale of the property proceeds be divided as follows:

   (a) to pay all costs, commissions and expenses associated with the sale, including reimbursing the Applicant for any costs incurred by him in preparing the properties for sale;

   (b) to discharge any encumbrance secured against the properties;

   (c) to pay the sum of $250,000 to the Applicant; and

   (d) the balance to be held in an interest-bearing trust account established by Coote Family Lawyers pending further Orders or written agreement between the parties.

   …

2. On the hearing of the matter on 15 December 2020, the Applicant sought not only a payment to him of $250,000 as described in order 2(c) above but a payment to each of the parties in the sum of $250,000.

3. The Applicant relied upon the following documents:-

   (a)affidavits of evidence sworn by the Applicant on 10 November 2020 and 8 December 2020;

   (b)a Financial Statement sworn by the Applicant on 10 November 2020; and

   (c)an affidavit of Mr E real estate agent, affirmed 7 December 2020.

4. In an Amended Response to Initiating Application filed 14 December 2020, the Respondent de facto wife (‘the Respondent’) joined the Applicant in seeking orders for the sale of the properties situate at and known as 1 D Street Suburb C in the State of Victoria and 2 D Street Suburb C in the State of Victoria (‘the D Street properties’). Otherwise the Respondent sought a sale of chattels and motor vehicles owned by the Applicant; and various procedural orders pertaining to valuations and financial disclosure.

5. In support of her application, the Respondent relied upon the following documents:-

   (a)affidavits of evidence sworn by the Respondent on 25 November 2020 and 13 December 2020;

   (b)an Amended Financial Statement filed 14 December 2020.

   (c)an affidavit of Mr F, the Respondent’s solicitor, sworn 11 December 2020; and

   (d)an affidavit of Mr G, real estate agent, sworn 14 December 2020.

   BACKGROUND

6. The Applicant was born in 1970. He is aged 50 years. He is a Company Director and otherwise unemployed save for his farming of, and subsequent sale of, livestock from the property which he purchased as described in paragraph 11 below at P Street J Town in the State of Victoria (‘J Town’). The income from these endeavours is applied to the operating and other expenses of J Town. The Applicant’s living expenses are met by ongoing reduction in his capital as claimed by him and by loans advanced from his father. The Applicant is currently residing at J Town.

7. The Respondent was born in 1972. She is aged 48 years. She is a Company Director by occupation and runs the business ‘V Pty Ltd’. She is currently receiving no income from that source. She is residing in the former matrimonial home which is the property situate at and known as H Street Suburb C in the State of Victoria (‘H Street’).

8. The Applicant and Respondent commenced their relationship in 2010 (on the wife’s evidence) or 2011 (on the husband’s evidence). They commenced their cohabitation in mid-2013 at H Street. They separated in July 2020. They cohabitated for approximately 7 years.

9. There are four children who resided with the parties at H Street during cohabitation. X born in 2005 who is aged 15 years and the son of the Applicant; Y born in 2007 who is aged 15 years and the daughter of the Respondent; and twins Z and W born in 2005 who are aged 13 years and are the children of the Respondent. X did not reside at H Street on a continuous basis, he moving between the residence of each of his mother and father. X attends FF School in K Town and Y, W and Z attend GG School which is situate close to H Street.

10. The Applicant ceased working in May 2013 shortly prior to cohabitation commencing. His evidence is that he has supported the family comprising the Applicant, Respondent and each of their children (to the not inconsiderable extent that he did so) from dwindling capital resources owned by him and from loans from his father.

11. When the parties commenced their cohabitation the Applicant owned properties as set out in paragraph 11 of his affidavit sworn 10 November 2020, being:-

    (a)2 H Street Suburb C which he purchased on 3 July 2007 for $2,450,000;

    (b)1 H Street suburb C which he purchased on 19 December 2007 for $1,150,000. This was the neighbouring property to H Street, acquired by the Applicant to extend 2 H Street (together 1 H Street and 2 H Street are ‘the H Street property’);

    (c)J Town which the Applicant purchased via the Oldfield Family Trust on 3 July 2008 for $2,800,000;

    (d)DD Street, Suburb M which the Applicant purchased in June 2009 for $700,000 (Suburb M). He sold this property in December 2014 for $670,000;

    (e)L Street, Suburb N which the Applicant purchased in 1997 for $705,000. He sold this property in April 2015 for $3,307,700 and he, the Respondent and the children of both lived off the net proceeds of sale of this property from 2015 to 2019 (L Street) as claimed by the Applicant; and

    (f)KK House, CC Town which the Applicant purchased via the Oldfield Family Trust on 20 August 2011 for $2,250,000 (KK House). The Applicant has recently sold this property.

12. As to the Applicant’s acquisition of the above properties and his debt to his father, the Applicant’s evidence is:-

    12. I purchased a number of the above properties using loans from my father, and his related entities, together with gifts of approximately $4,800,000 from him.

    13. At the commencement of the relationship, I owed my father the sum of approximately $8,872,774 and I estimate that my net financial position at that time was as follows:

    (a) 2 H Street $ 3,000,000

    (b) 1 H Street $ 2,000,000

    (c) Suburb M $ 800,000

    (d) LL Town $ 1,300,000

    (e) J Town $ 2,800,000

    (f) EE Town $ 465,000

    (g) L Street $ 1,500,000

    (h) BB Group Shares $ 5,100,000

    (i) Cash $ 5,400,000

    (j) Liabilities ($ 1,900,000)

    (k) Funds owing to my father ($ 8,872,774)

    TOTAL $ 11,592,226

    The Court notes that the LL Town property referred to above was sold prior to cohabitation commencing (and in May 2012) for the same sum, and the EE Town property referred to above was sold in May 2011 prior to cohabitation commencing.

13. After the parties commenced their relationship the Applicant purchased further properties. They are as described by him in paragraph 20 of his affidavit sworn 10 November 2020:-

    (a)Villa 1 Country HH in June 2012 for $1,884,000;

    (b)Villa 2 Country HH in April 2013 for $1,999,781;

    (c)2 D Street Suburb C in April 2013 for $895,000; and

    (d)1 D Street, Suburb C in May 2018 for $1,600,000.

    ((c) and (d) collectively, ‘the D Street properties’)

14. The D Street properties adjoin H Street. These properties were funded by bank loan and loan from the Applicant’s father.

15. At the commencement of cohabitation the Respondent had no assets or liabilities of significance.

16. During the parties cohabitation various persons were employed to assist in the operations of the household. They included nannies, a personal assistant, gardeners, a housekeeper and a cook.

17. Throughout the course of the parties’ cohabitation the parties funded their very high living expenses by reduction in capital. The Applicant’s evidence is that in 2015, the Applicant sold the L Street property via the entity AA Pty Ltd, and made a profit of approximately $1,700,000 on the sale. The parties lived off these proceeds of sale between 2015 and 2019 by way of dividends. In December 2018, the Applicant sold the Country HH Villas to his father for $1,500,000 each, for the purpose of providing further funds to meet the parties living expenses, however the properties remained in the Applicant’s name after the sale due to Country HH laws. The Applicant’s father went on to sell the villas in October 2019 and July 2020 to third-party international purchasers. In May 2020, the Applicant sold the KK House to his father for $2,400,000 with the purchase price being agreed upon on the basis of an independent valuation. The proceeds of sale were then applied to discharge a $958,000 mortgage facility secured against the property, and then to the Applicant in instalments of which the sum of $68,697.14 remains outstanding. The Applicant’s evidence is that the funds were used to meet the parties living expenses and fund the Respondent’s business.

18. In October 2018, the Applicant paid $288,000 to discharge a loan secured over property owned by the Respondent’s mother. The Applicant’s evidence is that these funds were advanced by way of loan to the Respondent’s mother, and that repayment of such loan is required.

19. The Applicant asserts that the parties assets and liabilities are as follows:-[1]

    [1] Affidavit of Mr Oldfield affirmed 10 November 2020, [29].

Asset	Legal Owner	Value (E)
REAL PROPERTY
2 H Street, Suburb C	Husband	$7,500,000
1 D Street, Suburb C	Husband	$1,600,000
2 D Street, Suburb C	Husband	$1,375,000
Total Property		$10,475,000
OTHER PROPERTY
Cash		$103,325
Q Bank #…75	Husband	$13
Q Bank #…37	Husband	$32,912
Ms Oldfield’s bank accounts	Wife	$17,000
Bank accounts	V Pty Ltd	$53,400
Other		$1,118,000
Motor Vehicles (personal name)	Husband	$200,000
Boat	Husband	$130,000
Home and contents	Husband	$500,000
Loan to Ms Oldfield's Parents	Joint	$288,000
V Pty Ltd(excluding bank accounts)	Wife	$NK
LIABILITIES
Loan Against 2 D Street, Suburb C	Husband	($1,140,000)
Long Standing Loan Monies from Mr T	Husband	($10,143,850)
Loan from Mr T for purchase of 1 D Street, Suburb C	Husband	($1,600,000)
Loan from Mr T in 2015	Husband	($652,147)
Loan from Mr T in 2019	Husband	($3,000,000)
Visa Credit Card Debt	Husband	($9,619)
R Credit Card	Husband	(NIL)
H Street Renovation Cost (balance)	Husband	(E$65,000)
Accrued Entitlement Payout for Ms S	Husband	($17,154)
V Pty Ltd Overdraft	Husband	($100,000)
Total Liabilities		($16,662,770)
Net Asset Position (excl. Superannuation)		($4,966,445)
SUPERANNUATION
Oldfield Family Super	Husband	$3,045,494
Superannuation	Wife	$31,235
TOTAL SUPERANNUATION		$3,076,729

1. The Respondent disputes this description of the parties assets and liabilities, in particular the Applicant’s claimed loans from his father which remain outstanding.

   SALE OF H STREET

2. Following separation the parties agreed to place H Street on the market and to complete a number of works on the H Street prior to sale. The agreed budget for such works was $155,000 with the parties having spent approximately $85,055 thus far. The Respondent then informed the Applicant in mid-October 2020 that she would not agree to listing H Street for sale prior to March 2021 and that she anticipated the sale process would take six months. The Applicant’s evidence is that the parties have limited funds from which they are able to meet day to day expenses and that H Street must be sold expeditiously to fund such expenses.  

3. The main issue for determination before the Court on 15 December 2020 was the sale of H Street. It did not seem to be in dispute that there is no source or no sufficient source of ongoing income available to the parties to meet their current living expenses. The Respondent’s position is that the D Street properties should be sold prior to the sale of H Street, in which the Respondent and her children continue to reside. She seeks to reside in same for an indeterminate period. The Applicant’s position however is that a sale of H Street and the D Street properties is inevitable. Both parties are unable to afford the retention of any of these properties. The Applicant’s case is that the three properties should immediately be placed on the market for sale to best advance the financial position of the parties. The Applicant relied upon affidavit evidence of Mr E real estate agent at B Realtors, affirmed 7 December 2020, as to the order of sale which included the need to ensure the sale of H Street first, or conversely all of the properties together. Mr E stated, relevantly:-

   9. Of the three properties…H Street is the most valuable property and therefore carries the most risk associated with its sale. I anticipate that potential H Street purchasers will be astute and savvy and will make enquiries about the prospect of developments around the properties. I would anticipate that they may be deterred from the purchase of H Street if a developer has purchased the two D Street properties adjoining the property. In order to maximise the sale price of H Street, I would strongly recommend that it be sold prior to the sale of the D Street properties. In my view, the value of H Street is likely to diminish substantially if a developer purchased the D Street properties. At worst, I estimate that it could decrease the achievable sale price of H Street by approximately 10% (that is by $800,000).

   10. Conversely, the value of the D Street properties could be increased if the purchaser of H Street also wishes to purchase the D Street properties. I do not otherwise anticipate that the sale of the H Street property first will detrimentally impact the sale price achievable from the D Street properties.

   11. …I agree that the D Street properties and the H Street property should be sold separately. In my view, however, H Street should be offered for sale first, in order to maximise the sale price of both H Street and D Street, and then the D Street properties should be sold. As set out above, the potential consequences of selling D Street first could be significant in terms of the sale price that is then achievable for H Street.

1. Mr E’s stated agreement in paragraph 11 above was with the opinion expressed by Mr G, real estate agent who swore an affidavit on behalf of the Respondent, that H Street and the D Street properties should each be sold at different times. Mr G’s evidence was that the properties should be sold after February 2021. I have noted that evidence. Mr G did not consider that developers would be attracted to the D Street properties. That is a matter which shall unfold. Both real estate agents agreed that H Street was the premier property.

2. The Applicant seeks that B Realtors real estate agents conduct the sale. The Respondent wishes to select three real estate agents from which the Applicant can select one. The Respondent opposes the selling agents being B Realtors. In the Court’s determination the Applicant should have the choice of agent. Nothing was put by the Respondent against B Realtors in the evidentiary material before the Court. The Applicant has owned H Street for many years purchasing it some six years before cohabitation commenced. The submission of the Respondent that B Realtors are partisan because they swore an affidavit on behalf of the Applicant is misplaced. Neither Mr E nor Mr G were partisan. They gave their expert opinion. B Realtors real estate agency will be engaged by the parties to sell H Street at the best price obtainable. It benefits neither the Applicant nor the Respondent if they do not do so. The agency is familiar with the property and is required to act in accordance with instructions as provided by the parties as shall be provided for in the orders.

3. The Respondent sought immediate funds be provided to her by the Applicant. She sought the sale of the Applicant’s cars and chattels to provide such funds to her. She acknowledges that the parties need to sell assets to acquire funds. The Respondent however has pointed to the weekly significant expenditure incurred by the Respondent that will not be met by such a sale in the short term. Furthermore, unlike the Applicant, the Respondent has access to an overdraft facility in relation to which the Applicant is a guarantor and in respect of which the Respondent’s counsel submitted an available balance of $89,000 existed. Counsel submitted however that use of such funds would endanger the immediate financial viability of the wife’s business. There was no evidence to support that submission. The Court infers that such funds are currently available to the wife pending her receipt of sale proceeds from the sale of the parties’ assets. But that is very much a necessary and immediate remedy which will dissipate. Because of that, and because the Respondent wife may resume operation of her business it is necessary for the Respondent to be placed in promptly funds whether by way of spousal maintenance or an advance on property settlement. Those funds can be derived by a sale of one vehicle which is surplus to the Applicant’s requirements. This sale should provide more readily, immediate funds. The Court accepts that the Respondent will require some sale proceeds, or access to deposit monies in respect of the sale of the real property in the near future which may not be available by reliance on paragraph 1(c) of the orders which the Court shall make. The wife has already received $30,000 by way of an insurance claim made and paid to her which was expended by her on holidays. It may be that boat and trailer with an estimated value of $160,000 will need to be sold prior to the parties’ receipt of $250,000 each from the sale of the real properties for which these orders shall provide. There was however insufficient evidence before the Court as to this matter in the context of a busy judicial duty list, and counsel and senior counsel’s addressing of the main issue which was the placing of H Street and the D Street properties on the market for sale. There shall be liberty for this matter to be re-visited by me if a resolution as to it and other outstanding matters is not achieved at its next listing on 23 February 2021 before Registrar Kourtis.

I certify that the preceding twenty-five (25) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Hartnett.

Associate:

Dated:       15 January 2021