OSWELL & OSWELL

[2020] FamCA 442

FAMILY COURT OF AUSTRALIA

OSWELL & OSWELL [2020] FamCA 442

FAMILY LAW – INJUNCTIONS – Undefended interim hearing – Where consideration of applicable principles – Where appropriate to make order for sale of former family home and discharge of mortgage with remaining funds to be held on trust pending further order – Where proper that the husband be restrained from interfering with, disrupting or otherwise impeding the sale of the former family home.

Family Law Act 1975 (Cth) ss 80, 114
Family Law Rules 2004 (Cth) rr 11.02, 16.07

Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175
Jarrah & Fadel [2014] FamCAFC 14
Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319

APPLICANT: Ms Oswell

RESPONDENT: Mr Oswell

FILE NUMBER: PAC 692 of 2020

DATE DELIVERED: 3 June 2020

PLACE DELIVERED: Parramatta

PLACE HEARD: Parramatta

JUDGMENT OF: Foster J

HEARING DATE: 13 May 2020

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Mr Dunn of Watts McCray (NSW) Pty Ltd

RESPONDENT – SELF-REPRESENTED LITIGANT: No appearance

Orders Made On 13 May 2020

1. That the Applicant Wife be appointed sole trustee for the sale of the property known as D Street, Suburb B NSW, being the land contained in folio Identifier … (hereinafter referred to as “the Suburb B property”) at the best price reasonably obtainable and for such purpose the same property shall vest in the wife as trustee.

2. That the Applicant Wife be hereby authorised to do all acts and sign all necessary documents to cause the Suburb B property to be sold by private treaty with a selling agent as selected by the Applicant, by a conveyancer instructed by the Applicant.

3. The Respondent Husband is hereby restrained from interfering with, disrupting or otherwise impeding the sale of the Suburb B property and is restrained from entering upon or otherwise remaining on that property.

4. Upon completion of the sale of the Suburb B property, the Applicant shall cause the proceeds of sale to be applied in the following manner:

   4.1Payment of the agent’s commission, marketing expenses and other selling expenses;

   4.2Payment of the conveyancing costs;

   4.3Payment of such sum as is required to discharge the mortgage secured on that property;

   4.4Payment of the sum of (or so much as is available) of $13,280 to C Company for the kitchen already ordered by the Applicant and the Respondent and manufactured by that entity;

   4.5Payment of any remaining balance into a controlled moneys account in the names of the Applicant and the Respondent and controlled by the Applicant’s solicitors to be distributed by agreement or by Order of this Court.

5. Reasons for judgment be published at a later date.

6. The costs of the Applicant wife in terms of the interim application determined today be reserved.

The Court Notes That

1. The proceedings are otherwise listed for a Financial Case Assessment conference before the registrar at 2.00 pm on 23 June 2020.

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

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

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 r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT PARRAMATTA

FILE NUMBER: PAC 692 of 2020

Ms Oswell

Applicant

And

Mr Oswell

Respondent

REASONS FOR JUDGMENT

1. In February 2020 the wife commenced proceedings seeking interim and final orders for property adjustment following the parties’ separation.

2. In her Initiating Application filed 13 February 2020 the wife sought final orders that, in summary, provided:

   a)That the proceeds of sale of D Street, Suburb B (“the former family home”) be divided 65 per cent to her and 35 per cent to the husband;

   b)That a base amount of $33,000 be allocated to the wife out of the husband’s interest in his superannuation fund;

   c)That the parties each, otherwise, keep all other property and resources in their respective possession and control; and

   d)That the wife have leave to amend her application once the husband has made full and frank disclosure.

3. In the wife’s Initiating Application she sought interim orders that, in summary, provided:

   a)That the wife be appointed trustee for the sale of the former family home;

   b)That the wife be authorised to cause the former family home to be sold by private treaty with a selling agent and conveyancer selected and instructed by her;

   c)That the husband be restrained from interfering with, disrupting or, otherwise, impeding the sale of the former family home and is restrained from entering upon or, otherwise, remaining on that property;

   d)That upon completion of the sale of the former family home the wife cause the proceedings to be applied in the following manner:

   i)Payment of the agent’s commission, marketing expenses and other selling expenses;

   ii)Payment of the conveyancing costs;

   iii)Payment of such sum as required to discharge the mortgage secured on that property;

   iv)Payment of the sum of (or so much as is available) of $13,280 to C Company for a kitchen already ordered by the parties and manufactured by that entity; and

   v)Payment of any remaining balance into a controlled moneys account in the names of the wife and the husband and controlled by the wife’s solicitors to be distributed by agreement of by order of this Court.

4. The husband is yet to file any Response to the interim or final orders sought by the wife.

5. For the purpose of the interim hearing, the wife relied upon the following documents:

   a)Initiating Application filed 13 February 2020; and

   b)Her affidavit filed 13 February 2020.

Procedural fairness

1. The husband did not attend on the date listed for interim hearing of the wife’s application yet was in attendance at the court event when the matter was allocated a date for interim hearing. He has failed to comply with directions made at a number of court events that he file a Response to the wife’s Application.

2. On 24 March 2020 the parties appeared by phone for a Case Assessment Conference before a registrar. On this date it was noted that the husband did not oppose the wife’s application for the sale of the former family home but intended to seek different orders relating to its sale to that of the wife. Directions were made for the husband to file a Response.

3. On 9 April 2020 the matter came before a registrar for judicial call over. The husband had not complied with the previous direction to file a Response and affidavit. It was noted that the husband had served unsealed documents on the wife’s solicitors including a Response which did not seek any interim orders. The registrar made directions that the husband file a Response and affidavit setting out his response to the interim relief sought by the wife.

4. On 7 May 2020 the matter again came before a registrar when it was noted that the husband had not complied with directions made on the two previous occasions that he file his Response. It was noted that the husband advised the Court that he was having difficulty filing his material on the Court’s electronic filing system and it was noted that the case coordinator would forward to the husband directions for electronically filing his documents. Orders were made for the husband to file and serve his Response and the matter was transferred to the judicial duty list for interim hearing on the wife’s application on 13 May 2020.

5. Rule 16.07 of the Family Law Rules 2004 (Cth) (“the Rules”) relevantly provides:

   Parties' participation

   (1) Each party to an application set down for hearing on the first day before the Judge must attend in person and, if legally represented, with their legal representatives.

   Note:The court may dispense with compliance with a rule (see rule 1.12).

   (2) If a party does not attend on the first day before the Judge, the other party may seek the orders sought in that party's application by, if necessary, adducing evidence to establish an entitlement to those orders in a manner ordered by the court.

   (3) …

6. Further, Rule 11.02(2)(c) of the Rules provides:

   (2)If a party does not comply with these Rules, the Regulations or a procedural order, the court may:

   (c)determine the case as if it were undefended.

7. In the event that the Court was not disposed to apply the provisions of rules 16.07 and 11.02, an adjournment of the proceedings would have been necessitated. The future conduct of the proceedings would be problematic in relation to the husband’s failure to engage in the proceedings where he has not yet filed a Response to the wife’s application despite directions being made on a number of occasions that he do so.

8. Considerations pertaining to an adjournment of proceedings, particularly in relation to parenting proceedings, were considered by the Full Court in Jarrah & Fadel [2014] FamCAFC 14. Ainslie-Wallace J referred to Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175, in which the majority of the High Court said at [217]:

   … delay and costs are undesirable and that delay has deleterious effect not only upon the party to the proceedings in question but to other litigants. … It would impact on other litigants seeking a resolution of their cases.

9. The wife’s application is urgent in circumstances where the parties have not made any mortgage repayments since April 2019 and the National Australia Bank (“NAB”) has previously issued a default notice.

10. It was appropriate for the interim matter to proceed on an undefended basis in the absence of the husband.

The wife’s evidence

1. The wife who is 37 and the husband who is also 37 commenced a relationship in August 2005 and later commenced cohabitation in March 2007. The parties, she says, lived rent-free with the wife’s parents until September 2009. Both parties worked full time, the wife as an Administrator for G Organisation earning approximately $65,000 per annum and the husband working as a trademan for F Organisation earning approximately $55,000 per annum.

2. The wife asserts that at the commencement of cohabitation she had the following assets:

   a)Savings $70,000;

   b)Motor vehicles $3,000;

   c)Furniture $3,500;

   d)Superannuation $40,000.

3. The wife asserts that the husband had the following assets at the commencement of cohabitation:

   a)Savings $20,000;

   b)Motor vehicles $20,000;

   c)Furniture $500;

   d)Superannuation $40,000.

4. In September 2009 the parties purchased the former family home. The wife asserts that they received a gift of $20,000 from her parents which they put towards its purchase.

5. The parties married in 2011. The wife deposes that the parties received a further gift of $20,000 from her parents and a gift of $5,000 from the husband’s mother which they contributed to the cost of their wedding.

6. In 2012 the parties’ first child, a daughter, was born. The wife took maternity leave from one month prior to the birth of the child until February 2013 when she returned to employment part time. She asserts that prior to the birth of the first child she was the primary homemaker and thereafter was the primary homemaker and carer for the children throughout the relationship.

7. In February 2013 the wife asserts that the husband received an inheritance from the estate of his grandmother of $90,000 which was contributed to household expenses, the purchase of a motor vehicle and a gift to the husband’s mother of $5,000.

8. The wife asserts that from May 2013 to December 2013 the husband was on leave to study and then commenced work as a public servant on 13 December 2013.

9. In 2013 the parties’ second child, another daughter, was born. The wife took maternity leave from around one month prior to the birth of the child until February 2015 when she returned to work part time and then full time employment in October 2015.

10. In 2015 the parties’ youngest child, a son, was born. The wife took maternity leave just prior to the birth of that child until she returned to part time employment in April 2017.

11. The wife asserts that in August 2016 the parties received a gift of $50,000 from the wife’s parents which they applied later to the cost of renovations and extensions to the former family home.

12. In November 2016 the husband completed an online course and secured permission to act as owner builder to undertake the planned renovation work. In December 2016 the parties commenced the renovation work and in January 2017 the NAB approved a line of credit facility for the renovations and extensions for up to $180,000.

13. In July 2017 the NAB approved an application made by the parties (or as the husband contends, the wife unilaterally) to increase the line of credit by $80,000 to cover over budget expenditure.

14. In March 2018 the wife made another application to borrow further funds to cover additional expenditure. The NAB consolidated the parties’ existing home loan, existing line of credit and approved a further borrowing of $78,000 to complete the works taking the total indebtedness of the parties to a maximum approved limit of $634,000.

15. In March 2018 the parties separated. The wife and children remained living at the home of the maternal grandparents where they had been living while the renovations were occurring. The husband moved back to the former family home and continued to undertake renovations. At the date of interim hearing there was still outstanding building works yet to be completed.

16. On 6 December 2018 the wife transferred $34,325.99 in undrawn funds from the loan account into her own personal bank account. She asserts that she applied part of these funds to the payment of expenses associated with the renovations.

17. The wife asserts that following separation she paid various bills relating to the former family home from her personal funds to the amount of $7,383.40 and made voluntary home loan repayments totally $6,100. She asserts that the husband made payments totalling $5,200 to the home loan following separation.

18. On 20 December 2018 the wife made an application to the NAB to suspend payments on the loan on the grounds of financial hardship. The NAB subsequently wrote to the wife to advise her that her application had been closed as the bank had been unable to contact her.

Mortgage default

1. Both parties ceased making voluntary contributions to the home loan in April 2019.  Between 20 March 2019 and 20 May 2019 the wife received correspondence from NAB advising her as to overdue payments and that further action may be taken if there was no immediate payment.

2. On 17 June 2019 the NAB issued a default notice to the wife requesting payment of $7,726.48. The wife subsequently applied to the NAB for financial assistance which was granted giving the parties a payment break ending on 7 August 2019 and requiring no payments before 5 September 2019.

3. On 30 August 2019 the NAB advised that the relief period had expired and the loan account repayments was in arrears of $13,682.92.

4. On 7 October 2019 $16,661.14 was credited to the loan account and then on 11 November 2019 a further $5,956.44 was credited with the description “right of set off … collections payment to home loan” which the wife asserts were funds withdrawn by the NAB from her personal NAB account without her knowledge or consent.

5. The wife asserts that she transferred the remaining loan funds in her personal NAB account in the amount of $11,212.19 to her Commonwealth Bank account.

6. On 11 December 2019 the NAB granted the wife a further payment break ending 11 February 2020 and then granted a further application suspending all payments until 24 March 2020.

7. The wife attempted through her solicitors to obtain the husband’s consent to sell the former family home. The husband failed to respond necessitating the wife’s commencement of proceedings in this Court on 13 February 2020.

The property pool

1. There is insufficient evidence before the Court to determine, with any certainty, the nature and extent of the matrimonial property pool available at this stage. No balance sheet was tendered in evidence nor is there any evidence as to valuation.

2. As far as can be ascertained from the wife’s evidence, the property pool comprises the following:

   Assets

   Joint              The former family home       $650,000E

   Husband        Motor Vehicle 1   $  12,000E

   Husband        Motor Vehicle 2   $      500E

   Husband        Motor Vehicle 3   $    8,000E

   Wife               Furniture   $  10,000E

   Husband       Furniture   $  10,000E

   Husband       Bikes   $    7,500E

   Superannuation

   Husband       Superannuation   $260,000

   Wife               Superannuation   $190,050

   Liabilities

   Joint              NAB Home Loan Account   $619,966

   Husband       NAB Credit Card   $    5,000

   Wife               H Credit Card   $    6,500

Discussion

1. The wife seeks an order that the former family home be sold with any remaining balance after the mortgage is discharged and a debt paid with the balance to be held in a controlled money account.

2. The wife agitates for the property’s sale immediately and in its current condition to avoid the mortgagee obtaining an order for possession and selling the property under its powers for sale.

3. The wife also seeks orders restraining the husband from interfering with the sale of the property and from entering or remaining upon the property.

4. Section 114 of Family Law Act 1975 (Cth) (“the Act”) provides:

   (1)In proceedings of the kind referred to in paragraph (e) of the definition of matrimonial cause in subsection 4(1), the court may make such order or grant such injunction as it considers proper with respect to the matter to which the proceedings relate, including:

   …

   (e)an injunction in relation to the property of a party to the marriage; or

   (f)an injunction relating to the use or occupancy of the matrimonial home.

5. Section 114 of the Act, permits the Court to make an order or grant such injunction that “it considers proper”.

6. Without making orders for property adjustment between the parties, it is appropriate, in the exercise of the Court’s powers, to make such orders as are proper.

7. The grant of an injunction is discretionary and the basis upon which an order or injunction may be made is well settled.  The wife in this case has readily satisfied the Court that there is a serious issue to be tried, that being the question of overall property entitlement as between herself and the husband.

8. The Court must have regard to the balance of convenience as between the parties in the context of the orders sought by both of them.  The determination about the balance of convenience may thus be an inference drawn from the facts and circumstances established by the applicant’s evidence: Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319 at 321-322.

9. Both parties agree that the former family home must be sold.

10. As at 29 February 2020 the NAB home loan account was in arrears of $8,934.50 with neither party having made any voluntary repayments since April 2019. The wife’s evidence is clearly supportive of there being an immediate need to proceed to sale to realise funds to meet the accruing liability before the bank seeks possession so as to exercise its power of sale.

11. In the present circumstances it is proper that the former family home be sold forthwith and that after payment of mortgage secured over the property is discharged and the debt discharged the balance of funds be held by the wife’s solicitor in a controlled moneys account pending further order.

12. As is submitted by the wife, the husband has actively resisted the wife’s attempts to mitigate the losses of the parties by failing to comply with directions made at several events before a registrar for the filing of a Response, not cooperating with the wife to facilitate sale despite agreeing that the former family home needs to be sold and not making any mortgage repayments himself. In these circumstances, it is proper that the injunction be made as sought by the wife restraining the husband from interfering with the sale of the property and from entering or remaining upon the property.

1. The wife also seeks orders that she be appointed as trustee for the sale of the former family home. The wife contends such an order is necessary to ensure that the sale of the former family home proceeds efficiently as the husband has to date failed to cooperate in any joint approach to sell and has previously been uncooperative in the wife’s attempts to discuss the completion of the renovations to the property.

2. The wife has undertaken to act diligently in her capacity as trustee and observe her obligations to sell the property for the best price attainable.

3. Pursuant to section 80(1)(e) and (k) of the Act, the Court, in exercising its powers under Part VIII, may appoint or remove trustees and make any other order which it thinks is necessary to make to do justice.

4. It is proper that the wife be appointed trustee given the husband’s lack of cooperation to facilitate the property being sold previously and the current urgency of the matter.

5. Orders will be made accordingly.

I certify that the preceding fifty-nine (59) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Foster delivered on 3 June 2020.

Associate: 

Date:  3 June 2020