OROSZ and SOWARDS
[2010] FCWA 99
•24 SEPTEMBER 2010
JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA
ACT: FAMILY COURT ACT 1997
LOCATION: PERTH
CITATION: OROSZ and SOWARDS [2010] FCWA 99
CORAM: THACKRAY CJ
HEARD: 3 SEPTEMBER 2010
DELIVERED : 24 SEPTEMBER 2010
FILE NO/S: PTW 3828 of 2009
BETWEEN: MS OROSZ
Appellant
AND
MR SOWARDS
Respondent
Catchwords:
APPEAL - LEAVE TO APPEAL - de facto property settlement - interlocutory order of Family Law Magistrate requiring appellant to leave home and transfer interest to respondent - non-disclosure of material facts by respondent - leave to appeal granted - appeal allowed - respondent to pay mortgage payments pending trial.
APPEAL - PRACTICE AND PROCEDURE - nature of appeal by way of rehearing.
Legislation:
Family Court Act 1997
Category: Reportable
Representation:
Counsel:
Appellant: Mr S Walker
Respondent: Mr M Berry
Solicitors:
Appellant: Tyrone B Grantham
Respondent: Lawton Gillon
Case(s) referred to in judgment(s):
Ah-Chee v Ah-Chee (PT 2314 of 2000)
Allesch v Maunz (2000) FLC 93-033
Cameron and Bell [2006] FCWA 139
Camm v Camm [2003] FCWA 129
Foote v Clune (PT 735 of 1988)
Kinraid v Walker (PT 3445 of 1999)
Martin v Bent (PT 2739 of 1996)
Phillips v. Commonwealth (1964) 110 C.L.R. 347
Re Coldham; Ex parte Brideson [No 2] (1990) 170 CLR 267
Roberts and Cetinic-Dorol [2008] FCWA 22
Rowe and Matthews [2006] FCWA 137
Strahan & Strahan (2009) 42 Fam LR 203
Tate v Tate (PT 5989 of 2000)
Truman & Clifton [2010] FCWA 91
WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL
JUDGMENT - PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN
CHANGED
1This is an application for leave to appeal, and if leave is granted an appeal, by [Ms Orosz] against orders made on 30 June 2010 by Family Law Magistrate Fleming in property settlement proceedings involving her former de facto husband, [Mr Sowards].
2The learned Magistrate made a suite of orders precisely as requested by the respondent. These required a valuation to be obtained of a home in [Suburb A] which the parties had acquired in 2006. Upon the valuation being obtained the respondent was required to pay $50,000 to the appellant, which was to be treated as part of her property settlement. Upon payment being made, the appellant was required to move out of the home, where she had been living since the respondent departed in September 2009. She was also required to transfer her interest in the property to the respondent and he was required to refinance the mortgage.
3As these orders were interlocutory, leave to appeal was required. I directed that the application for leave be argued at the same time as the appeal itself; however, at an early stage in the argument I indicated my intention to grant leave in light of the non‑disclosure of material facts by the respondent at the hearing below. Counsel for the respondent properly did not oppose this course.
Brief background
4The evidence has yet to be tested, but the following background facts appear largely uncontroversial.
5The appellant is 41 years of age. She is employed on a part‑time basis as a [secretary], earning a very modest income. The respondent is 40 years of age and is the [Manager] of a [national company], earning a substantial income.
6The appellant and respondent commenced cohabitation in January 2007 and separated in July 2009. They never married and there were no children of their relationship. Both parties have children of previous relationships.
7The parties acquired [Property A], as tenants in common in equal shares, on 13 October 2006. Surprisingly, neither provided clear evidence as to precisely how the acquisition of the property was funded.
8The respondent’s evidence suggests that Property A was initially acquired without using the equity each party had in other property at the commencement of their relationship. In the case of the appellant this was a property in [Suburb B], from which she netted $399,858 when it was sold. In the case of the respondent it was a property in [Suburb C] - [Property C], from which he netted $377,932 when it was sold.
9The respondent asserted that the appellant received the funds from sale of her property in February 2009 and he received the proceeds of his property in December 2008 (i.e. well after Property A was acquired). The appellant’s evidence was vague about when the two properties were sold and the evidence of both parties was equivocal about precisely what happened to the proceeds of sale.
10On 1 June 2007 the appellant and the respondent entered into a Deed which purported to evidence an agreement in relation to the sale of Property A in the event either gave notice they wanted the property to be sold. The Deed was drawn by the same solicitors who now represent the respondent.
11Although the Deed recited that the parties “intend to purchase [Property A]”, the Certificate of Title corroborates the appellant’s evidence that the property had been acquired in October 2006. In a nutshell, the Deed provided for a sale and equal division of the proceeds at the request of either party, subject to an option to the respondent to acquire the appellant’s interest at a price to be determined by valuation.
12On 28 July 2009, the appellant commenced proceedings for property settlement under the Family Court Act 1997 seeking an order which, in its totality, read “as and by way of property settlement there be alteration of property interest whereby each party received 50% the assets” (sic).
13On 27 August 2009 the respondent filed a response in which he sought that the appellant’s interest in Property A be transferred to him and that he retain various items of property including a pleasure boat, two motor vehicles, a caravan, an interest in the [XYZ] Unit Trust, various bank accounts and superannuation entitlements.
14On 22 September 2009, the respondent left Property A and obtained rental accommodation in the same suburb. As it turned out, the respondent was about to take up residence with another woman, although he kept that fact a secret.
Relevant procedural history
15On 11 March 2010, the respondent filed a Form 2 in which he sought orders that upon payment by him of $50,000, the appellant be required to vacate Property A and transfer her interest in the property to him (on the basis that he would become solely responsible for the mortgage). On 31 March 2010, the appellant filed a response in which she sought that the Form 2 be dismissed with costs.
16On 15 April 2010, the appellant filed a Form 2 in which she sought an order that the respondent discharge the arrears on the Property A mortgage and that he pay all future interest instalments. On 30 April 2010, the respondent filed a response in which he sought that the Form 2 application be dismissed with costs.
17These two sets of applications came before the Court on 5 May 2010. After hearing submissions, Family Law Magistrate Fleming reserved his decision. The judgment was delivered on 30 June 2010, at which time the orders that are the subject of this appeal were made.
18Following the delivery of judgment, written costs submissions were made. On 23 July 2010, the parties were advised that the decision relating to costs would be handed down on 28 July 2010. In the meantime, however, the appellant had filed her Notice of Appeal. On 28 July 2010, the Magistrate declined to hand down his costs decision. Instead he ordered that “the application for costs be stayed and dealt with at the Appeal Hearing”.
19I pause to observe that it is contrary to principle for a judicial officer to adjourn a costs application for hearing by the tribunal dealing with an application for leave to appeal against the substantive orders. Clearly the ultimate outcome of the costs issue might well depend upon the result of the application for leave to appeal, but this was not a sufficient basis to delay handing down the costs decision, especially in circumstances where it was known his Honour was about to retire from office.
20In any event, on 9 August 2010 the appellant filed an application for a stay of the substantive orders and leave to rely on further evidence. In addition, the appellant sought an order for the respondent to pay “$15,000‑$25,000 [sic] to bring the loan account back into order”. She went on to seek orders in relation to disclosure of documents and production of the Family Court file relating to the respondent’s previous marriage.
21The application of 9 August 2010 came before Family Law Magistrate Fleming on 13 August 2010, at which time the application was adjourned generally with liberty to apply. The record was noted that an agreement had been reached in relation to the stay. In the meantime I had expedited the hearing of the Notice of Appeal.
22On 24 August 2010, the appellant filed a further application in which she sought leave to rely, at the hearing of the appeal, upon an affidavit of the respondent’s father sworn in proceedings involving the respondent and his former wife. It was asserted that this affidavit established that the respondent “had deceived the Court and the other party to those proceedings by placing funds in the control of his father, and drawing on them when required, but without detection”. Leave was also sought to rely upon the affidavit the appellant had filed on 9 August 2010 relating to the stay application.
23On 1 September 2010, the respondent filed a response, opposing the introduction of the affidavit of his father, but consenting to the introduction of the appellant’s last affidavit, provided he was permitted to rely upon responding affidavits sworn by him and his current partner.
24I heard the appeal on 3 September 2010 and reserved my decision. In hearing argument, I dismissed the appellant’s application for leave to rely upon the affidavit of the respondent’s father. (I should record that decision related only to use of that affidavit in the appeal.) I also admitted into evidence the affidavit of the appellant sworn on 9 August 2010 and the two affidavits filed by the respondent in response.
The way the evidence unfolded
25The proceedings have been dealt with, thus far, only on the basis of affidavit evidence. It is appropriate that I outline the way in which the evidence unfolded, since by this means the respondent’s failure to make a full disclosure of his financial position will become apparent. This will, in turn, explain why I am not persuaded that the disclosure he has now made accurately reflects his financial position.
26When the appellant filed her property settlement application in July 2009 she also filed a Statement of Financial Circumstances in which she disclosed an income of $270 per week and no assets of substance, save for her interest in Property A, which she estimated was worth $1.2 million and which she said was subject to a mortgage of $800,000.
27The respondent’s Statement of Financial Circumstances filed in August 2009 disclosed a gross weekly income of $4,600 and gross weekly expenditure of $5,550. His estimate of the value of the assets was as follows:
| $ | |
| [Property A] | 950,000 |
| Savings account | 6,248 |
| Further savings account | 62,336 |
| Investment in [XYZ] Unit Trust (one third) | 58,533 |
| Shares | 2,200 |
| Monies owed by appellant’s mother (half of the loan) | 54,500 |
| Motor vehicles | 36,000 |
| Household contents | 5,000 |
| Pleasure boat and caravan | 107,000 |
| Superannuation | 100,000 |
| TOTAL | 1,381,817 |
28The respondent also stated that he had a financial resource in the form of a “cheque for taxation liability” of $33,000. He disclosed the following liabilities:
| $ | |
| Mortgage | 998,000 |
| Assessed but unpaid income taxation | 63,508 |
| Visa card | 6,183 |
| Hire purchase | 81,955 |
| TOTAL | 1,149,646 |
29In an affidavit sworn on 27 November 2009, the appellant complained that the respondent had not provided adequate documentation in response to her request for disclosure of documents. She claimed that his Statement of Financial Circumstances was “deficient in a number of ways”, and referred in particular to his alleged failure to include real estate in which she claimed the respondent had an interest ([in another] property in Suburb A [Property D], which she said was being sold).
30In his affidavit in response sworn on 11 January 2010, the respondent joined issue with the claim that he had not provided adequate disclosure. In particular, he said Property D was owned by the XYZ Unit Trust. He said the property had been sold subsequent to him providing his informal list of documents to the wife. He said the Unit Trust had received only $21,785 from the sale, which had been used to reduce debts of the Trust. He claimed he had disclosed an appraisal for that property and “for all other properties owned by the XYZ Unit Trust”.
31The respondent recorded that his interest in the Unit Trust had been disclosed in his Statement of Financial Circumstances (in which it will be recalled he estimated his one third interest as being worth $58,533). He went on to say, however, that after swearing his Statement he had obtained appraisals of the properties owned by the Unit Trust and that his solicitors had, in September 2009, advised the appellant’s solicitors that he now estimated the value of his interest at $95,000.
32On 14 January 2010, the appellant’s solicitor swore an affidavit in which he referred to documents produced by the mortgagee of Property A, which he said disclosed transfers of “substantial sums of money”. Attached to his affidavit was a schedule of transactions totalling in excess of $1.1 million. He also referred to what he described as “unexplained drawdown facilities” involving sums as large as $500,000 and $200,000.
33The respondent swore an affidavit in support of his application filed on 11 March 2010. In that affidavit he noted that the appellant’s financial contributions during the relationship comprised the sum which she had received from sale of her Suburb B property (nearly $400,000), together with her salary totalling only $35,500. His financial contribution was said to be approximately $1.05 million, of which about $378,000 was from the sale of his Suburb C property, and the rest was from salary payments and bonuses (the latter comprising $89,000 received in March 2007, $110,000 in March 2008 and $88,000 in March 2009).
34The respondent’s affidavit went on to note that the amount owing on Property A mortgage was $1,007,094, which he observed was more than the appraisal of $950,000 he had obtained for the property. The respondent noted that the appellant had never paid any of the mortgage payments and stated his belief she did not have the capacity to pay. He went on to note that since July 2009, when the parties had first separated under the one roof, he had paid the mortgage payments, which averaged about $4,400 per month.
35The respondent claimed he had moved out of Property A on 22 September 2009, inter alia, because he did not consider it was in the interests of his two children, with whom he shared custody with his former wife, for him to continue living in the property. He said he was now renting at a cost of $800 per week and that, in addition to paying the mortgage payments, he was paying all other outgoings on Property A.
36The respondent claimed that at the time of separation he had requested the appellant to move out of the property and said he offered to pay “a substantial amount on account of her property settlement to assist with her relocation expenses”, but she had refused to move.
37The respondent also set out what he called his “standard monthly salary and monthly commitments”, which were as follows:
| $ Monthly Income | |
| Standard net salary | 11,575 |
| Monthly Expenses | |
| Rent | 3,450 |
| NAB Homeside interest | 4,900 |
| XYZ Unit Trust standard contribution | 2,000 |
| Child Support | 1,750 |
| GE Money (furniture) | 300 |
| HBF medical insurance | 200 |
| Various bills, rates, water rates and usage, electricity, mobile phone, school fees | 1,500 |
| Boat repairs, moorings and maintenance | 700 |
| Car servicing repairs and petrol | 600 |
| Food, groceries, children’s clothing and activities | 1,000 |
| Total | 16,400 |
38The respondent claimed that “in December 2009 I reached a point where I can no longer afford to pay interest on the Mortgage, pay rent for the accommodation I am now living in and meet my weekly commitments” and said he had therefore stopped paying the mortgage payments. As a result, the Property A interest payments for January and February 2010 were outstanding. He again claimed that the appellant was unable to afford the payments and, in any event, she did not wish to retain the property as part of her settlement. He also claimed that the appellant had failed to maintain the property and that this had adversely affected its value. (No details were provided of this assertion, and I note the appraisals and valuations provide no support for it.) He concluded, “taking all these matters into account, the Property needs to be sold”.
39The respondent then drew attention to the terms of the July 2007 Deed. As already noted, the Deed made provision for Property A to be sold at the request of either party, subject to the respondent’s option to acquire the appellant’s interest. [The Deed also recorded that the appellant agreed that the respondent could “go to Melbourne to watch the football as many times as he likes”, but this clause did not feature in the appeal.]
40The respondent went on to record that he had finance approval to allow him to pay the appellant $50,000 by way of partial property settlement and to take on responsibility for the mortgage. He declared that his proposal was most reasonable given that the net value of the parties’ assets was less than $200,000, of which $109,000 was a loan to the appellant’s mother. The respondent also claimed that if the matter was not resolved, the bank “is likely to repossess the Property and sell it by mortgagee sale”. He said this would result in a reduction in the pool of assets due to the fees which would be charged and the likelihood of a reduced sale price.
41In her affidavit in response, the appellant confirmed she had contributed capital of about $400,000 to the relationship, whereas she said the respondent had contributed only about $340,000 (she apparently did not accept that the respondent had received about $377,000 from Property C, although the documents he provided corroborated his assertion to that effect). The appellant went on to say she did not accept that the whole of the mortgage balance of in excess of $1 million related to Property A. She asserted that the respondent “had made other drawings from that facility for his own sole purposes and the property has been used as security for those additional borrowings”.
42The appellant’s affidavit also referred to correspondence between the solicitors in which the appellant had queried a variety of financial transactions, including those referred to in the affidavit previously sworn by her solicitor. Whilst explanations were provided, they were considered by the appellant to be “inadequate”. The appellant’s affidavit then went on to refer to specific transactions which led her to conclude that the asset pool was far larger than what the respondent claimed. She concluded “the [respondent] has managed to make borrowings on the property in excess of its value without reference to me and without my permission, but has not accounted for the additional borrowing. I have received no benefit from those drawings”.
43The appellant then set out her financial position. She claimed she worked as a medical receptionist, on average about 16 hours a week, and received $250 per week net. She asserted she was unable to obtain any other employment, as her qualifications and experience were “limited to Sales, Merchandising and Reception”. She then set out her major weekly expenses, which totalled $589. She acknowledged her health was good. She noted that her two children spent each alternate weekend with her, as well as half of the school holidays. She said if she was required to rent she would do so in the Suburb B area, and estimated she would have to pay between $400 to $450 per week. (She had earlier claimed that the $800 per week allegedly being spent by the respondent on rent was “far above the market rentals for reasonable accommodation in Perth”.) The appellant said if she rented in Suburb B she would have to find alternative employment. She said she had been in her present job for three years and had a sympathetic employer, who allowed her to adjust her work to suit her family and other commitments.
44Finally, the appellant said that she understood the respondent was presently on vacation [interstate], and that whilst he claimed he was unable to pay the interest on the mortgage, he was able to “maintain his previous life style”.
45The respondent filed a further affidavit on 1 April 2010, to which he attached a default notice from the mortgagee and an Internet Banking summary. He said that reference to the Internet Banking summary demonstrated the mortgage facility was $12,634 overdrawn (being three months interest), although the default notice referred to arrears of only $2,694. While the default notice indicated that the amount owed to the mortgagee was $802,695, the Internet Banking summary showed there was a total of $1,012,640 outstanding on the parties’ various accounts with the mortgagee.
46In her next affidavit, filed in support of her application of 15 April 2010, the appellant noted she had also received a default notice. Her affidavit put in issue the extent of the respondent’s monthly commitments. The appellant also claimed, without providing corroborating evidence, that in December 2008 the mortgage balance stood at $460,000. She also claimed that the respondent had provided no evidence concerning his alleged contribution of $2,000 a month to the XYZ Unit Trust. She further claimed that the respondent had failed to disclose the fact that in February or March each year he receives a bonus of approximately $80,000 net (in fact the respondent’s first affidavit had disclosed such bonuses in three consecutive years).
47The appellant finally asserted that the respondent was residing with “another lady” at an address in [Suburb A] and indicated that she required the respondent to disclose the rental being paid on that property. She declared that the respondent’s “partner” would be liable for “half of the outgoing on that property”.
48On 30 April 2010, the respondent filed yet another affidavit. In this document he confirmed that he lived at [Property E] and that he paid (cash) rent of $800 per week. He did not actually confirm that he was living with anybody else at the rental property, but he did refer to the fact that he had recently spent two weeks interstate with his “current partner” and his two children. He claimed that the first week was for “business purposes”, during which time his employer met his accommodation costs. The second week was a family holiday, which he said had been planned since approximately May 2009.
49The respondent attached to his affidavit a variety of documents designed to support his assertions relating to his outgoings. He also attached correspondence between the solicitors in which his solicitors had given explanations of transactions which had been queried by the appellant’s solicitors. The respondent put in issue the assertion that there was only $460,000 owing on the mortgage as at December 2008. He said there were two loans in respect of the property, one with a limit of $200,000 and the other with a limit of $800,000, and that as at the beginning of December 2008 the combined balance of the two loans was just short of $1 million.
50The respondent next referred to the bonuses he had received in 2007, 2008 and 2009, which he said had been placed into his savings account. He said that a “significant amount” from the bonuses had been “transferred to the home loans”. He disclosed that one week after he had sworn his affidavit on 8 March 2010 he was paid a further bonus of $80,000 net. He commented that it was his practice to defer payment of most of his tax, and that accordingly he had a “significant tax liability” each year. He provided a letter from his accountants, which estimated his tax liability for 2009/10 was $48,000 and noted that he had a liability of $33,000 for 2008/09. He said he intended to use his most recent bonus to meet his taxation liabilities and claimed he had already spent the monies he had previously set aside for the 2008/09 tax in order to meet “my living expenses and Trust commitments”.
51The respondent described how he had transferred $340,000 from the sale of Property C into the Property A home loan account, which he said was done “to temporarily reduce the interest payments on the loans”. He further asserted that it was the parties’ joint intention that “this amount would be redrawn over time to pay for substantial amounts such as accounting and solicitors fees, my 07/08 tax liability and monies owed to the XYZ Unit Trust which I knew at the time I had to pay at a later date”. Later in his affidavit, the respondent provided some details concerning his involvement in the Unit Trust. He claimed that each unit holder was required to make a contribution to the shortfall of the trust equal to the net profit before tax, less the interest on loans for the properties owned by the trust.
52The respondent concluded his affidavit by noting that when the matter had been placed in the defended list at the second Conciliation Conference held on 27 April 2010 the parties were advised that the trial would not occur within the next 18 months. He claimed that in light of this delay, “arrangements need to be made for the sale of the property as it is not possible, realistic, nor fair for me to discharge the interest arrears on the loan and continue to make all future interest payments for an indefinite period”.
The decision of the Family Law Magistrate
53The paragraphs above adequately describe the state of the evidence at the time of the hearing before the learned Magistrate. It was on the basis of that evidence that his Honour made the orders sought by the respondent.
54His Honour expressed his reasons in the following terms:
The Court takes the view that there can only be one outcome in this particular matter. To arrive at that outcome I have made the following findings:
• It is clear that the Applicant will never have the financial resources to continue to reside in the property after a final trial. The only outcome for the retention of the property is for the Respondent to retain the property and utilise his substantial earning power to pay the mortgages on that property. This will depend, of course, on a determination by a Trial Judge.
• I take the view that there are no mysteries in this particular case and that the matters raised by the Applicant in relation to disclosure, the payment of rent and the like, together with the expenditure of the Respondent, have been adequately explained in his affidavit evidence. This also includes the utilisation of his bonuses for the payment of outstanding liabilities to the Australian Taxation Office.
• Even if the Court were to find some criticism in relation to some items of spending of the Respondent it is in the parties’ interest to endeavour to retain the property, at least in the short term, and not go to a mortgagee sale.
• It is clear that the Applicant will need to relocate at some point and the proposals put by the Respondent for the payment of a lump sum of $50,000.00 or 50% of the net equity in the property, whichever is the greater, is a fair proposal under the circumstances. There can be no disadvantage to the Applicant.
• Given the short duration of this relationship and the fact that there are no children of the relationship there can be no justification in requiring the Respondent to continue to make high mortgage repayments and pay rent at the same time when there is no possibility of the Applicant retaining the property in the fullness of time.
• Again, the evidentiary value of the deed suggests that the parties had to an extent considered this option and all the Respondent is seeking the Court to do is validate an early intention of the parties.
Given the above findings I take the view that in light of the decision in Strahan & Strahan (Supra) and, in the circumstances of this case, the orders sought by the Respondent are both just, equitable and appropriate under the circumstances. The Respondent is simply seeking to manage the parties’ precarious financial circumstances and also provide a sufficient sum for the Applicant to obtain alternate accommodation.
• Insofar as the claim for exclusive occupation is concerned the corollary to the above reasoning is that this is not a case where any order for exclusive occupation would be appropriate under the circumstance of the case.
Further evidence emerges
55In her affidavit in support of the stay application, the appellant said she had become aware that the respondent had purchased a property at [Suburb D] in joint names with [Ms B]. She provided a copy of the relevant Transfer signed on 21 May 2010, which noted that stamp duty of $25,840 was payable. She observed that the purchase of this property was pending at the time of the hearing before the Family Law Magistrate, but had not been disclosed.
56The appellant also attached a letter from the respondent’s solicitors, dated 2 August 2010, in which she was directed to vacate her home pursuant to the Magistrate’s orders. The letter noted that, in accordance with the orders, the property had been valued at $1 million, and that accordingly there was no equity. The letter nevertheless recorded that the respondent accepted he was required to pay to the appellant the $50,000 “relocation expenses”, upon payment of which she was required to transfer her interest in the property to the respondent. The appellant also deposed to the fact that she had received a text message from the respondent on 1 August 2010 referring to her obligation to vacate the property. She recorded that the text message said that the respondent “had made arrangements for the property for Monday 30th August”, but that the text had not said what those arrangements were.
57In his affidavit in response, the respondent said he was “now in a relationship” with Ms B, who had changed her name by deed poll to “[Ms Sowards]” in May 2010. He asserted that “[Ms B] moved from [Sydney] to Perth on 2 October 2009 to be with me”. He claimed that when Ms B moved to Perth, the rental home in which he was living, [Property E] was for sale. In November 2009 Ms B found out that she was pregnant, whereupon she allegedly informed the respondent she did not want to live in a property that was being sold. Instead she wanted to purchase her own home, having previously sold her home in Sydney. The respondent said he informed Ms B that he was hopeful of resolving matters with the appellant and, when he did so, they would be able to move into Property A.
58The respondent said that when it began to appear unlikely that agreement would be reached, he had informed Ms B that he did not know if or when they would be able to move into Property A. Ms B then restated her desire to buy her own home. Accordingly, in early March 2010, they met with a mortgage broker. The broker advised that it would be “very difficult” for Ms B to obtain a loan and that it would be necessary for the respondent’s name to be on the title. The respondent said it was on this basis they had agreed to purchase the new home in joint names.
59The respondent sought to explain his failure to disclose all of these matters previously by saying:
14.These details concerning my relationship with [Ms B], her pregnancy and her desire to purchase a house were private and I did not think that disclosing those details would assist in reaching a resolution with [the appellant].
60The respondent went on to acknowledge that he and Ms B had made an offer to acquire [Property F] on 16 March 2010. The respondent acknowledged he had paid the $5,000 deposit and that finance approval was obtained on 6 May 2010. The finance obtained was not sufficient to complete the purchase, as the respondent went on to explain in the following way:
18.As it turned out, [Ms B] was $20,000.00 short of the purchase price after paying stamp duty, fees and obtaining a loan from AMP. To enable the house purchase to proceed I paid this shortfall of $20,000.00 from my bonus which I had received from my employer in March 2010.
61The respondent recorded that he and Ms B had moved into the property after settlement on 24 May 2010. He noted that the interest payments over the first three months had been in the region of $2,500 to $2,800. He estimated that his payments on the property, including outgoings, would be approximately $2,900 per month, which compared with his previous rent of $3,450 per month. (There was no suggestion in the affidavit that Ms B would assist with the periodic outgoings.)
62Having set out how much cheaper it was for him to live in Property F, the respondent then announced his plan to sell that property and for him and Ms B to move into Property A. He thought this might take some time and he said that in the meantime he would rent Property A to cover the interest payments. He anticipated he would receive rent of about $800 per week.
Nature of the appeal
63The rights of appeal in proceedings pursuant to the Family Court Act 1997 are contained in Part 7 of the legislation.
64Section 210A deals with appeals from (non-federal) decrees made by Family Law Magistrates, other than interlocutory orders.
65Section 211 makes provision for (non-federal) appeals from:
(a)interlocutory orders of Family Law Magistrates; and
(b)interlocutory and final orders of Magistrates of the Magistrates Court of Western Australia, other than the Family Law Magistrates.
66As the orders of the Family Law Magistrate in the present matter were interlocutory, it is s 211 which governs the appeal. That section relevantly provides (the highlighted notes are my own commentary):
211. Non‑federal jurisdictions
(1)Subsection (2) does not apply if the Magistrates Court is constituted by a family law magistrate, unless the decree is an interlocutory order and —
(a)the Family Court of Western Australia has granted leave to appeal; or
(b)the decree is a decree prescribed in the regulations for the purposes of this paragraph. [Note – no decrees have been prescribed for the purposes of this subparagraph.]
(2)In respect of the non‑federal jurisdictions of the Magistrates Court an appeal lies from a decree of the court to the Family Court of Western Australia and upon any such appeal the Court —
(a)must proceed by way of a re‑hearing, but may receive as evidence any record of evidence given, including any affidavit filed or exhibit received, in the Magistrates Court; and
(b)may make such decrees as it thinks fit, including a decree affirming, reversing or varying the decree the subject of the appeal.
…
(4)Appeals under subsection (2) to the Family Court of Western Australia are to be made in the manner and within the time prescribed by the rules. [Note – “the rules” are the Family Court Rules 1998.]
…
67In determining the nature of the appeal itself (once leave to appeal has been granted) it important to observe that s 211 differs from the provisions of the Family Law Act 1975 (Cth) governing appeals from decrees made in the exercise of federal jurisdiction by Federal Magistrates and Family Law Magistrates of Western Australia, and it also differs from the provisions of the federal legislation dealing with appeals from decrees made by Magistrates sitting in courts of summary jurisdiction.
68For present purposes it is sufficient to note that the Family Court Act 1997 provides that appeals from non-federal decrees made by Magistrates (including Family Law Magistrates) in Western Australia must proceed by way of “rehearing”, not by way of hearing “de novo”. Furthermore, the Family Court Act 1997 does not give power to the appellate Court to remit the matter to the Magistrates Court, which is a power available to the appellate Court when dealing with a decree made in the exercise of federal jurisdiction by a Federal Magistrate or a Family Law Magistrate of Western Australia. Finally, there is no express power to allow the introduction of further evidence (as there is under the federal legislation in the case of appeals against decrees made by Federal Magistrates and Family Law Magistrates of Western Australia, although not in the case of decrees made by other Magistrates in courts of summary jurisdiction).
69Notwithstanding the absence of an express provision in the state legislation allowing for the introduction of further evidence, the Family Court Rules 1998 (WA) adopt that portion of the Family Law Rules 2004 (Cth) dealing with appeals, including Rule 22.39 which deals with the introduction of further evidence. Rule 22.39 prescribes a procedure for seeking permission to introduce further evidence on appeal, but this is expressly stated not to apply to appeals proceeding by way of hearing de novo. As presently advised, I consider the adoption of that rule to be appropriate, given the clear implication in s 211(2) that the appellate Court has the option of considering evidence other than the evidence led in the court below.
70At the commencement of the hearing, I expressed the view that once leave to appeal was granted, the appeal itself would proceed by way of hearing de novo. I was in error in saying so, since s 211(2) expressly provides that the appeal proceeds by way of rehearing. In expressing that view I had overlooked the dichotomy that has long existed in Western Australia between appeals from decrees of Magistrates exercising federal jurisdiction and appeals from decrees in the non‑federal jurisdiction.
71Notwithstanding the clear difference in the language employed, it is my experience that Judges of this Court have commonly proceeded on an unstated assumption that a rehearing pursuant to the Family Court Act 1997 (and its predecessor) is for all intents and purposes the same as a hearing de novo.
72I have undertaken a review of judgments in appeals from decrees of Western Australian Magistrates exercising non-federal jurisdiction. This review (which I do not claim was exhaustive) suggests that Judges have generally been able to deal with such appeals without discussing what is the practical effect of s 211(2) prescribing the appeal as being by way of rehearing. The same can be said of judgments dealing with the predecessor of s 211(2), namely s 81(2) of the Family Court Act 1975.
73One notable exception was Barlow J who, in a string of both federal and non‑federal appeals, did provide some explanation of the nature of the appeal process. In each case his Honour, having recited the statutory provision(s), repeated the following formulation:
The nature of an appeal by way of a hearing de novo was considered by the Full Court in Robinson and Willis (1982) FLC 91-215. In that case, Fogarty J at 77,163 explained the nature of such an appeal as follows:
“In my view, it ought to be characterised not as an appeal in any real sense, but as a process enabling a party to have in effect a second hearing on the merits. It is a fresh hearing before a Judge …… and is to be determined by the evidence adduced then and the relevant law at that time. The power ….. to receive any record of evidence given below is facilitative only. The Judge is not reviewing the decision below to find error but is examining afresh the issues before him and exercising his own discretion.”
His Honour then went on to refer to a passage from a decision of the High Court in Phillips and the Commonwealth (1964) 110 C.L.R. 347. In that case the Court was dealing with an appeal in the nature of a rehearing. At P 350 the Court expressed the view that in relation to such an appeal, that is to say an appeal by way of a rehearing, it was:
“….for the Court to pronounce anew upon the rights of the parties as disclosed by the evidence before it.”
74Judgments in which Barlow J followed this formula included Kinraid v Walker (PT 3445 of 1999), Ah-Chee v Ah-Chee (PT 2314 of 2000), Tate v Tate (PT 5989 of 2000) and Camm v Camm [2003] FCWA 129. What is of particular interest is that his Honour used the same words regardless of whether he was dealing with a non-federal appeal (as in Kinraid) or a federal appeal (as in the other cases I have mentioned). In each case, however, he correctly identified the relevant statutory provisions, which clearly stated that the federal appeals were to proceed by way of hearing de novo and the non-federal appeal was to proceed by way of rehearing.
75The fact Barlow J cited the same authority in each of these matters, without himself commenting on any difference of substance between a rehearing and a hearing de novo, might suggest that he took the view that there is no material difference between the two types of appeal (at least for the purposes of the Western Australian legislation). It may be important to note, however, that Barlow J paid no attention in Ah Chee, Tate or Camm to the decisions of the Magistrates, whereas in Kinraid (the non-federal appeal) he did refer to the Magistrate’s decision and expressed his disagreement with aspects of it.
76Prior to commencing his practice of referring to the relevant statutory provisions and then reciting the extract from Robinson and Willis, Barlow J had been far more succinct in explaining the nature of the appeal. Thus in Foote v Clune (PT 735 of 1998), in determining an appeal under the Family Court Act 1997, his Honour said simply, “This Appeal is by way of a rehearing. In other words, I must determine the matters in issue are fresh [sic]”. Interestingly, his Honour used precisely the same words, with the typographical error corrected, in Martin v Bent (PT 2739 of 1996), which was an appeal pursuant to the Family Law Act 1975 at a time when appeals under that Act from the specialist family law Magistrates in Western Australia proceeded by way of hearing de novo. In neither of those two matters did Barlow J pay any particular attention to the reasons given by the presiding Magistrate.
77 The way in which Barlow J quoted from the judgment of Fogarty J in Robinson and Willis leaves me in some doubt as to whether his Honour considered that Fogarty J’s purpose in reciting the passage from Phillips was to illustrate the difference or the similarity between the two types of appeal. In fact, reference to the original judgment shows that Fogarty J’s views may not have been entirely accurately captured in Barlow J’s judgments. The relevant portion of Fogarty J’s judgment at 77,163 actually reads as follows:
Given those rather diverse matters, it is not easy to characterise the process so as to answer the fundamental question in this case. However, it appears to me that, construing the statute since the amendment in 1979, the process is really a unique one which one should not attempt to slot into any particular category. In my view, it ought to be characterised not as an appeal in any real sense, but as a process enabling a party to have in effect a second hearing on the merits. It is a fresh hearing before a Judge under sec. 96 and is to be determined by the evidence adduced then and the relevant law at that time. The power under sec. 96(4)(a) to receive any record of evidence given below is facilitative only. The Judge is not reviewing the decision below to find error but is examining afresh the issues before him and exercising his own discretion. It is “for the court to pronounce anew upon the rights of the parties as disclosed by the evidence before it”; Phillips v. Commonwealth (1964) 110 C.L.R. 347 at p. 350.
78It would seem from the juxtaposition of his own remarks and his citation from Phillips that Fogarty J considered that in dealing with an appeal by way of hearing de novo, the formulation in Phillips applied, namely that the obligation of the appellate court was “to pronounce anew upon the rights of the parties as disclosed by the evidence before it”. It is nevertheless the case, as Barlow J pointed out, that Phillips concerned a provision characterising the appeal as being a rehearing, rather than a hearing de novo.
79Another case in which a Judge of this Court took time to reflect on the significance of the appeal being by way of rehearing was Rowe and Matthews [2006] FCWA 137. Penny J found at [4] that there was “no doubt that the Magistrate in the Bunbury Court did not determine this matter according to law”; however she later went on to say at [7]
Because of the provisions of s 211(2)(a) of the Act, this appeal cannot be successful just because the Magistrate made an error in law. The matter is now before me by way of a rehearing. I must consider afresh whether the injunction sought by the father restraining the mother from leaving the Bunbury area should be granted. I intend to take into account not only the comments made by the parties at the hearing on 11 August 2006, but the affidavits filed by …[her Honour then went on to list a large number of later filed affidavits she proposed to take into account.]
80In Cameron and Bell [2006] FCWA 139, Penny J again noted that the appeal proceeded by way of rehearing and then proceeded to determine the matter without regard to the reasons of the Magistrate. Her Honour’s approach suggested that she dealt with the matter in the same way as she would have approached an appeal by way of hearing de novo.
81The only other decision of this Court which, so far as I have been able to ascertain, touches on the issue is Roberts and Cetinic-Dorol [2008] FCWA 22, to which I was referred in oral submissions. That was a decision of mine in which I (correctly this time) described the appeal process as by way of rehearing. However, in doing so I said this:
22If [the appellant’s] application for leave to appeal is successful, the appeal will proceed by way of rehearing and in that event it would be unnecessary to demonstrate that the Magistrate erred in arriving at her decision. Accordingly, on the hearing of the appeal, it would be unnecessary to consider her Honour’s reasons at all. However, as the legislation requires a party to obtain leave before being able to appeal against an interlocutory decision of a Magistrate, it is appropriate for me to give consideration to the way in which the matter was argued before the Magistrate and to have regard to her reasons. This is especially so here, since [the respondent] claims that the Magistrate did not err in dismissing [the appellant’s] application because his counsel failed to agitate any portion of that application (save for paragraph 1 by which he sought to discharge the consent orders). [emphasis added]
82In the course of hearing argument in the present matter, I had occasion to reflect on the accuracy of the remarks I made in Roberts and Cetinic‑Dorol, in particular the suggestion that on a rehearing it is not necessary to demonstrate that the Magistrate erred in arriving at the original decision. In the process, it occurred to me that my observations may be inconsistent with the judgment of the majority of the High Court in Allesch v Maunz (2000) FLC 93-033 where the following was said [footnotes omitted, emphasis added]:
22.The majority in CDJ v VAJ proceeded on the basis that an appeal under s 94(1) of the Act is an appeal by way of rehearing. That is undoubtedly correct. So much is to be discerned from the terms of s 93A(2), in particular its conferral of power to receive further evidence. That is not a power possessed by appellate courts whose jurisdiction is confined to appeals in the strict sense and whose function it is simply to determine whether the decision under appeal was or was not erroneous on the evidence and the law as it stood when the original decision was given. And an appeal under s 94(1) is, as s 93A(2) indicates, to be distinguished from an appeal under s 96 which is a hearing de novo.
23.For present purposes, the critical difference between an appeal by way of rehearing and a hearing de novo is that, in the former case, the powers of the appellate court are exercisable only where the appellant can demonstrate that, having regard to all the evidence now before the appellate court, the order that is the subject of the appeal is the result of some legal, factual or discretionary error, whereas, in the latter case, those powers may be exercised regardless of error. At least that is so unless, in the case of an appeal by way of rehearing, there is some statutory provision which indicates that the powers may be exercised whether or not there was error at first instance. And the critical distinction, for present purposes, between an appeal by way of rehearing and an appeal in the strict sense is that, unless the matter is remitted for rehearing, a court hearing an appeal in the strict sense can only give the decision which should have been given at first instance whereas, on an appeal by way of rehearing, an appellate court can substitute its own decision based on the facts and the law as they then stand
83The sentence I have highlighted in the above extract may hold the key to determining whether s 211(2) does, in fact, require the appellant to establish there was error at first instance before the appellate court is empowered to depart from the decision of the Magistrate. In this regard, I note that the majority in Allesch v Maunz supported the highlighted sentence by reference to the decision of the High Court in Re Coldham; Ex parte Brideson [No 2] (1990) 170 CLR 267. That decision, in turn, affirmed earlier authority that the “nature of the appeal must ultimately depend on the terms of the statute conferring the right” (at 273‑4).
84There seem to me to be a number of features of the Family Court Act 1997 which suggest that the power of the appellate court to interfere with the decision of the Magistrate may be exercised without error having been demonstrated on the part of the learned Magistrate. If that is so, there may be very little difference, for practical purposes, between an appeal by way of rehearing and an appeal by way of hearing de novo (save for permission being needed under the rules to introduce further evidence in the case of an appeal by way of rehearing).
85Some of the features of the Family Court Act 1997 I have in mind are:
(a)the fact there is no express provision for the introduction of further evidence, but with there being an implication in s 211(2)(a) that the Court can receive whatever additional evidence it sees fit;
(b)the fact there is no express power to remit the matter for rehearing to the Magistrates Court (a feature in common with the de novo appeals under the Family Law Act 1975);
(c)the nature of the jurisdiction being exercised (a fact which the High Court in Re Coldham, at 274, clearly considered was relevant in seeking to ascertain the intention of Parliament as to the circumstances in which the appellate court can interfere with the first instance decision);
(d)the terms of subparagraph 211(2)(b) itself, which appear to give the Court a very broad power to make whatever order it thinks fit, short of remitting the matter for rehearing.
86Although I had the benefit of some helpful submissions touching on the nature of the appeal process, they were not exhaustive. I would therefore prefer to await a more appropriate occasion before expressing a concluded view on these matters. For reasons I will express shortly, it is unnecessary here to attempt to define with precision the scope of the power of the appellate court pursuant to s 211(2). I would observe only that regardless of the extent of the Court’s power on the hearing of the appeal itself, the observations made in Re Coldham, at 275, concerning the function of leave to appeal provisions, will be of importance in ensuring that appeals from interlocutory orders of Family Law Magistrates are not to be regarded as a “second bite of the cherry”, as arguably is the case with appeals by way of hearing de novo.
87The reason it is unnecessary for me to determine the scope of the power conferred by s 211(2) is that the respondent’s failure to make a full disclosure of his financial position led inevitably to his Honour’s discretion miscarrying, as it is apparent he found that the respondent’s financial situation was as stated by him, when in fact the Court only knew part of the story. In such circumstances, not only should leave to appeal be granted, but the appeal itself should be allowed. This leaves me free to determine the interlocutory applications on the basis of the evidence as it now stands and without paying any further regard to the decision of the learned Magistrate.
Discussion
88The difficulty in determining the appropriate outcome is that there has still not been any cross‑examination, in circumstances where the appellant strongly disputes the respondent’s claims about his financial circumstances. Her position is understandable. She asks, in effect, how can it be that there is now so little to show for the $400,000 she very recently introduced into the relationship, and the $340,000 or more that the respondent introduced, in circumstances where the respondent was earning a high income and receiving large bonuses? It is true the respondent has purported to provide some explanation for the various transactions which had been questioned, but his explanations have not been tested.
89One thing is clear. Until such time as there has been a thorough examination of his affairs, and his evidence has been tested, there is no basis for me to proceed on the assumption that the respondent has now made a full disclosure. The matters which he has belatedly brought to the attention of the Court have been revealed only as a result of the efforts of the appellant. The respondent had every opportunity in his affidavits sworn after October 2009 to disclose the circumstances relating to his cohabitation with Ms B and he failed to do so. He had every opportunity after 16 March 2010 to disclose that he was purchasing a new property with Ms B and he failed to do so. He had every opportunity up to, and indeed after, the hearing in May 2010 to disclose that, contrary to his protestations about his inability to pay the mortgage payments, he had sufficient funds to contribute at least $25,000 toward the home he was acquiring with Ms B – and again he failed to do so.
90This level of non-disclosure raises concerns about the extent to which the respondent may have arranged matters so as to “warehouse” some of the more than $740,000 capital that has been injected into this short relationship. There may, of course, be some entirely proper explanation for how this amount has been whittled away in a short time; however, the respondent’s abject failure to make the full and frank disclosure required of him means, for the time being at least, that he has forfeited the right to be believed on any assertion that is not firmly corroborated.
91The respondent apparently remains willing and able not only to pay the appellant the $50,000 he has offered to pay her (and which he is obliged to pay under the terms of the orders), but is in a position to refinance the million dollar mortgage on Property A, while at the same time remaining, for the time being, jointly liable with his current partner for the $534,606 mortgage on Property F (in circumstances where his partner has very recently had his baby and gives her occupation as “home duties”).
92If the orders of the Magistrate are discharged the respondent will not have to pay the appellant the $50,000, which sum would be sufficient to cover the mortgage payments of $4,400 for a period of nearly a year. (There are, of course, other outgoings on the property, but the evidence about the full extent of these is not clear.) Apart from the $50,000 the respondent apparently has available, he also has good reason to anticipate that he will once again receive a very large bonus in March 2011, as he has now for many years. In these circumstances I am not satisfied that the respondent is unable to meet the mortgage payments and other outgoings on Property A until the trial of these proceedings. On the contrary, it seems to me that he would find a means of doing so.
93The respondent’s own evidence establishes that the appellant is unable to meet the mortgage payments. I accept that her affidavit evidence is less than persuasive about why she is working so little, when she does not have full-time responsibility for children and is in good health. However, even if she worked more, the appellant would still have a very modest income by comparison to that of the respondent, and would be unlikely to earn more than what she needs to live at a reasonable standard.
94Subject to what I will say later, it is understandable the appellant does not wish to leave her home until the proceedings are finalised. If she is in residence when the judgment is delivered (or when the matter is settled) she can then see how much capital she has available to her and can then move to accommodation appropriate to her means. The alternative, under the current orders, is for her to have to rent when she first moves out, whereas, if she is ultimately successful in recovering capital similar to what she injected into the relationship, she may have enough funds to buy, without the inconvenience and expense associated with moving twice. In making this observation I am expressing no view on the likelihood of the appellant recovering anything like what she brought into the relationship. The prospects of that occurring will depend on the accuracy of the assertions made by the respondent about the way in which their funds have been dissipated during the short relationship.
95The learned Magistrate made very brief reference in his reasons to the decision of the Full Court of the Family Court of Australia in Strahan & Strahan (2009) 42 Fam LR 203. It was proper for his Honour to look to that authority since it deals with applications for interim property settlement. I was a member of the Full Court and in my separate judgment I said this:
225These sorts of considerations provide a strong basis upon which the Court should maintain its traditional stance that there should ordinarily be only one hearing of disputes concerning alteration of property issues. I accept the submission of senior counsel for the wife that something out of the usual course would need to be established before the Court could be expected to devote its resources to resolution of disputes about interim alteration of property interests. However, once the Court has determined that it is appropriate to embark upon the hearing of an interim dispute, it has no alternative other than to exercise (or decline to exercise) the power to make an interim order by application of the relevant provisions of the legislation.
226In my view, the two step approach advocated by senior counsel for the Wife aptly encapsulates the way the Court should approach an application for interim property settlement. The Court must first identify circumstances that make it appropriate to give consideration to exercising its power to make an interim order. It is at this stage that the Court has regard to the policy consideration that it is generally in the interest of the parties and the Court for there to be only one exercise of the s 79 power. However, once the Court has determined that the interests of justice require it to exercise the power, the conditions on which the power is to be exercised are governed only by the obligation to make an order that is “appropriate” and to ensure that the proposed order is “just and equitable” by reference to the matters set out in s 79(4).
96I make no criticism of the learned Magistrate for having embarked upon consideration of the respondent’s application, since on the evidence there appeared to be a prospect of a mortgagee sale. It seemed something needed to be done, although whether that necessarily involved the transfer of the appellant’s interest in the property to the respondent was a matter requiring careful analysis. However, it is now known his Honour was not given all of the facts. Had he been aware that the respondent had the capacity to pay $25,000 to purchase a different property, on top of his capacity to find $50,000, his Honour may not have seen it is as being appropriate to conduct an interim hearing, since the funds were sufficient to cover the mortgage for an extended period. It would also have been highly relevant for his Honour to have known that the respondent was living with another woman, and that she had available a not insignificant sum of money from the sale of her former home. She clearly had the means to assist to meet the rent and other living costs that the respondent claimed he was meeting alone. In such circumstances it may have been that the respondent would not have even crossed the first hurdle described in Strahan.
97It is important to consider how much longer the parties will have to wait before the matter proceeds to trial. The matter proceeded to a Conciliation Conference in September 2009, but by oversight the draft conference file note was not typed and provided to the parties and listings staff. The note reveals, however, that the Registrar directed that the matter be placed in the Defended List with an estimated hearing time of 3 days. Liberty was given to the parties to seek another conference and this was held before a different Registrar on 27 April 2010, at which time the matter was formally included in the Defended List. In view of the earlier oversight, I propose to direct that the matter be included in the List with effect from the date of the first conference. This will advance the case by 200 places from where it currently stands.
98Regrettably, the state of the List is such that I am advised there could still be a delay of some seven months before the matter will be listed for a Readiness Hearing. It will then have to wait another few months for a trial. This is, of course, a most unsatisfactory state of affairs (as to which see the remarks I made recently in Truman & Clifton [2010] FCWA 91, which will shortly be published on the Family Court website). Nevertheless, it means that the case will reach trial within the next 12 months, during which time I am satisfied the respondent will have sufficient means, one way or another, to maintain the mortgage payments and other outgoings.
99Although I propose to order the respondent to meet the mortgage payments and the other outgoings pending the trial, the appellant needs to consider her position carefully. She lives alone in a six bedroom, four bathroom/powder room home (apart from occasional visits from her children). The $50,000 which the respondent was willing to pay her will no longer be payable, and can now be directed toward the mortgage payments. It may be that trial Judge will determine that it was not appropriate for the appellant to have remained in the property during the long wait for trial and/or give credit to the respondent for maintaining the property in that period. If such a view were taken, the amount the respondent might ultimately receive may be significantly less than what she would receive if she left the home now. I express no view on the likelihood of that occurring – the trial judge may take an entirely different view if he or she finds that the appellant was justified in wishing to stay in her home until the respondent made an accurate disclosure and provided a better offer.
100My remarks thus far deal only with future payments. There is also the question of the arrears. I do not have evidence concerning what payments, if any, have been made this year. It seems none may have been made. Given the failure of the respondent to make a proper disclosure, I am not satisfied he does not have the capacity to discharge the arrears – and in any event he has other assets that could be sold. The arrears would not have accrued had it not been for the fact that he chose to use available funds to acquire another property at the same time as claiming he could not support payments on property he already owned. His conduct in this regard does provide at least some basis for inferring, as was asserted, that the respondent has engineered the present state of affairs with a view to forcing the appellant out of the property, so that he could move back in.
101I therefore consider it appropriate to order that the respondent make such arrangements as will ensure that the mortgagee does not exercise its powers of sale. If that involves discharging all arrears, so be it. The respondent works at a senior level in the finance industry and may be in a position to negotiate an arrangement which will not require the arrears to be discharged in full. Under the terms of the order I propose to make that is a course that would be open to him.
102It will be observed I have not found it necessary to have any regard to the Deed entered into between the appellant and the respondent in 2007. It is common ground this was not a Binding Financial Agreement, notwithstanding that the capacity to enter into such an agreement was available at the time the document was executed. The appropriate time for consideration of the real effect (if any) of the Deed would be at the time of trial when it can be considered along with all of the other evidence.
Costs
103I will hear submissions in relation to the costs of the appeal. As for the costs of the proceedings below, there having been no determination, the appropriate order is for those to be reserved to the judicial officer who hears the substantive proceedings.
Orders
104Subject to hearing from counsel, I propose to make the following orders:
1.The appellant have leave to appeal against the orders of Family Law Magistrate Fleming made on 30 June 2010.
2.The appeal be allowed.
3.That the orders of the Magistrate be set aside.
4.That pending disposal of the proceedings the respondent pay the mortgage payments and rates, taxes and insurances relating to Property A as and when they fall due for payment.
5.The respondent make such payments or arrangements in relation to the finance facilities secured against the title to the said property as shall ensure that the mortgagee does not exercise its power of sale.
6.The question of costs of the proceedings before the Magistrate be reserved for determination by the judicial officer ultimately hearing the applications of the parties for property settlement.
7.That the Manager, Caseflow include the matter in the Defended List with the priority it would have enjoyed had the matter been included in the List on the date of the first Conciliation Conference, namely 14 September 2009.
I certify that the preceding [104] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court
Associate
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