FEDERAL CIRCUIT COURT OF AUSTRALIA
| PAYNE & PAYNE | [2013] FCCA 794 |
| Catchwords: FAMILY LAW – Property – company in liquidation – allocation of debts – contribution and s.75(2) factors favour wife – Part VIIIAA order directed to husband’s father as a third party creditor. |
| Legislation: Family Law Act 1975, ss.75(2), 79, 79(1), 79(2), 79(4), 90AE |
| Stanford & Stanford [2012] HCA 52 Lee Steere v Lee Steere (1998) FLC 91-626 Hickey v Hickey & Attorney General of the Commonwealth of Australia (Intervenor) (2003) FLC 93-143 In the Marriage of Omacini (2005) 33 Fam LR 134 D & D [2003] FamCA 473 Ibbott & Ibbott [2008] FMCAfam 38 |
| Applicant: | MS PAYNE |
| Respondent: | MR PAYNE |
| File Number: | ADC 4245 of 2011 |
| Judgment of: | Judge Kelly |
| Hearing dates: | 5 and 6 March 2013 |
| Date of Last Submission: | 6 March 2013 |
| Delivered at: | Adelaide |
| Delivered on: | 17 July 2013 |
REPRESENTATION
| The Applicant: | In Person |
| Counsel for the Respondent: | Ms J Cocks |
| Solicitors for the Respondent: | Websters Lawyers |
ORDERS
The parties do all things and execute all documents necessary to cause the former matrimonial home situate at Property C in the State of South Australia to be placed on the market for sale within 35 days.
The property shall be listed for sale by private treaty in the first instance with a real estate agent to be agreed between the parties within 14 days and in default of agreement as nominated by the President of the Real Estate Institute of South Australia.
The property shall be listed for sale at a price to be agreed between the parties taking into account the advice of their real estate agent.
Upon settlement of sale of the property, the proceeds of sale shall be applied as follows:
(a)in discharge of the mortgage secured thereon;
(b)to pay all rates, taxes and other adjustments as required;
(c)to pay all fees, commissions and disbursements arising from the sale;
(d)to pay the sum of NINETY THREE THOUSAND FIVE HUNDRED AND TWELVE DOLLARS AND THREE CENTS ($93,512.03) to (omitted) Accountants in discharge of the Directors’ loan outstanding to (omitted) Pty Ltd (In Liquidation);
(e)to pay the sum of THREE THOUSAND ONE HUNDRED DOLLARS ($3,100) to (omitted) Primary School towards the children’s outstanding school fees;
(f)to pay any balance then remaining to Mr Payne in partial repayment of the debt owed to him by the parties in their personal capacity as joint guarantors.
Thereafter the husband retain responsibility for any debt still owing by the parties to Mr Payne, whether such debt is owed personally, in their capacity as joint guarantors or in their capacity as directors of (omitted) Pty Ltd (In Liquidation) and do indemnify the wife in relation to that debt.
Thereafter each party retain all assets presently in their possession free from any claim by the other party, including any superannuation entitlements.
The wife pay the mortgage repayments and all other outgoings associated with the former matrimonial home while she remains living in the premises.
The wife provide the husband with…
- AGLC
- PAYNE & PAYNE [2013] FCCA 794
- Case
- [2013] FCCA 794
- Decision Date
CaseChat Overview and Summary
The central legal issues before the court were how to achieve a just and equitable division of the parties' assets and liabilities, particularly in light of significant debts owed by a company in liquidation and personal guarantees. This involved determining the priority of payments from the sale of the matrimonial home, including mortgage discharge, sale expenses, a director's loan, school fees, and repayment of a debt owed to Mr Payne. Furthermore, the court needed to address the ongoing responsibility for remaining debts and the division of other assets, including superannuation.
In reaching its decision, the court applied principles of property settlement under the *Family Law Act 1975* (Cth). Judge Kelly ordered the former matrimonial home to be placed on the market for sale within 35 days, with the proceeds to be applied first to the mortgage, then sale costs, followed by specific payments for a director's loan and school fees. The remaining balance was to be paid to Mr Payne towards a debt owed to him. The court further ordered that Mr Payne would retain responsibility for any remaining debt owed to him, indemnifying Mrs Payne. Each party was to retain assets in their possession, and Mrs Payne was to pay the mortgage and outgoings on the former matrimonial home while residing there. Crucially, the court substituted Mr Payne as the party responsible for any debt owed to him by the parties personally, as joint guarantors, or as directors of the company in liquidation.
The court made final orders dismissing all proceedings as finalised, with costs reserved for 28 days.
Orders
Orders of the court
1.
The parties do all things and execute all documents necessary to cause the former matrimonial home situate at Property C in the State of South Australia to be placed on the market for sale within 35 days.
2.
The property shall be listed for sale by private treaty in the first instance with a real estate agent to be agreed between the parties within 14 days and in default of agreement as nominated by the President of the Real Estate Institute of South Australia.
3.
The property shall be listed for sale at a price to be agreed between the parties taking into account the advice of their real estate agent.
4.
Upon settlement of sale of the property, the proceeds of sale shall be applied as follows:
(a) in discharge of the mortgage secured thereon;
(b) to pay all rates, taxes and other adjustments as required;
(c) to pay all fees, commissions and disbursements arising from the sale;
(d) to pay the sum of NINETY THREE THOUSAND FIVE HUNDRED AND TWELVE DOLLARS AND THREE CENTS ($93,512.03) to (omitted) Accountants in discharge of the Directors’ loan outstanding to (omitted) Pty Ltd (In Liquidation);
(e) to pay the sum of THREE THOUSAND ONE HUNDRED DOLLARS ($3,100) to (omitted) Primary School towards the children’s outstanding school fees;
(f) to pay any balance then remaining to Mr Payne in partial repayment of the debt owed to him by the parties in their personal capacity as joint guarantors.
5.
Thereafter the husband retain responsibility for any debt still owing by the parties to Mr Payne, whether such debt is owed personally, in their capacity as joint guarantors or in their capacity as directors of (omitted) Pty Ltd (In Liquidation) and do indemnify the wife in relation to that debt.
6.
Thereafter each party retain all assets presently in their possession free from any claim by the other party, including any superannuation entitlements.
7.
The wife pay the mortgage repayments and all other outgoings associated with the former matrimonial home while she remains living in the premises.
8.
The wife provide the husband with 14 days written notice in the event that she vacates the former matrimonial home prior to the date of settlement.
9.
Save as otherwise provided for in these Orders, the husband shall retain responsibility for all debts in his sole name.
10.
Save as otherwise provided for in these Orders, the wife shall retain responsibility for all debts in her sole name.
11.
Paragraph 1 of the Orders of 16 December 2011 is discharged.
12.
Pursuant to section 90AE(1)(a) of the Family Law Act 1975 (as amended) Mr Payne substitute the husband in lieu of the wife with respect to any debt owed to him by the parties personally, in their capacity as joint guarantors or in their capacity as directors of (omitted) Pty Ltd (In Liquidation).
13.
All proceedings are otherwise dismissed as finalised.
14.
Both parties’ costs are reserved provided that any Application for costs is filed within 28 days.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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