PERTO & COOMB

FEDERAL CIRCUIT COURT OF AUSTRALIA

PERTO & COOMB

[2019] FCCA 172

Catchwords:
FAMILY LAW – Interim – property – interim spouse maintenance.

Legislation:

Family Law Act 1975 (Cth), ss.72, 75, 77

Cases cited:

Hall & Hall [2016] HCA 23

Bevan & Bevan [1993] FamCA 95

Applicant:

MR PERTO

Respondent:

MS COOMB

File Number:

SYC 6871 of 2018

Judgment of:

Judge Henderson

Hearing date:

9 January 2019

Date of Last Submission:

9 January 2019

Delivered at:

Sydney

Delivered on:

1 February 2019

REPRESENTATION

Counsel for the Applicant:

Mr Sansom SC

Solicitors for the Applicant:

Strathfield Law

Counsel for the Respondent:

Mr O'Ryan QC

Solicitors for the Respondent:

Swaab Attorneys

ORDERS PENDING FURTHER ORDER

That the husband pay to the wife the sum of $1359 per week by way of spouse maintenance back dated to 9 January 2019 and weekly thereafter into an account nominated by the wife.
That the husband forthwith include the wife in his BUPA Health Care policy at the top rate.
That the wife be responsible for the payment of the outgoings in respect of the property in her name at Property A.
That the husband maintain the mortgage payments including strata levies and rates for the property in Property B, and the wife to be responsible for the payment of utilities.

IT IS NOTED that publication of this judgment under the pseudonym Perto & Coomb is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYC 6871 of 2018

MR PERTO

Applicant

And

MS COOMB

Respondent

REASONS FOR JUDGMENT

This is an application by a wife for interim spouse maintenance in the sum of $1,475 per week together with payment of other outgoings, being electricity and gas for the apartment she is living in, being a property owned by the parties at Property B and the shortfall between the rental she receives for a property in her name at Property B and the strata of that property. The rental received does not cover the mortgage and quarterly instalments of strata levies of some $760 per quarter. This is $3040 a year, amortised as a weekly amount, some $60 per week.
The husband resists the application on each ground, namely, he asserts the wife does not fulfil the threshold test as a wife unable to support herself adequately under section 72 of the Act[1] even after having had regard to the matters under section 75(2) of the Family Law Act.[2]
[1] Family Law Act 1975 (Cth) s72.
[2] Above, note 1, s75(2).
Section 72(1)[3] reads :
[3] Above, note 1, s72(1).
A party to a marriage is liable to maintain the other party, to the extent that the first-mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately, whether:
(a) by reason of having the care and control of a child of the marriage not yet attained the age of 18 years –
(b) by reason of age or physical or mental incapacity for appropriate gainful employment; or
(c) for any other adequate reason.
The husband asserts the wife does not fulfil any of the threshold criteria under section 72 of the Act.[4] The wife agrees section 72(1)(a)[5] is not relevant in this matter.
[4] Above, note 1.
[5] Above, note 1, s 72(1)(a).
Secondly, he submits that if I find she is a spouse in need of maintenance he disputes her needs are $1473 per week together with the strata levy shortfall of $60 a total of $1600 per week and that her needs approach $600 per week.
Thirdly, he submits whatever her needs are he has no capacity to pay other than what he now pays which is the mortgage on the property she is living in.
The manner by which this interim maintenance hearing was run and the plethora of material tendered, one could have been mistaken in thinking I was hearing a final maintenance application.
Mr O‘Ryan QC appeared for the wife and Mr Sansom SC for the husband.

Material

For the wife:
a)Response filed 14 November 2018 seeking property orders and urgent spouse maintenance pursuant to section 77 of the Act[6] and interim maintenance;
b)Affidavits filed 13 November 2018 and 4 January 2019;
c)Financial statement filed 19 November 2018; and
d)Wife’s exhibits – as per exhibit sheet.
[6] Above, note 1, s 77.
Husband’s evidence:
a)Application for property orders, injunctions etc. filed 26 October 2018;
b)Affidavits of 26 October 2018 and 20 November 2018;
c)3 Financial statements filed 25 October 2018, 21 December 2018 and 4 January 2019; and
d)Husbands exhibits – as per exhibit sheet.
Ultimately, this is a matter of complexity and length if the parties proceed to a final hearing possibly. The parties are, to their credit desirous of having this matter finalised by way of a mediation and will provide me with consent orders in relation to valuations of the significant and extensive assets by way of realty and share-holdings in their various companies. I raise the issue of the number of assets to be valued for the mediation to demonstrate that these are people of significant wealth who led a lavish, extravagant and self-indulgent lifestyle during their marriage.
The assets that currently comprise the matrimonial pool at this early stage of the proceedings are:
a)Properties at Property C, where the wife lives;
b)Property D;
c)Property E;
d)Property F1-F4
e)1 to 4 – including a garage at Property F1;
f)Property G;
g)Property H;
h)Property J; the former matrimonial home;
i)Property K;
j)Property L;
k)Motor Vehicle 1;
l)Motor Vehicle 2;
m)Motor Vehicle 3;
n)Husband’s 60 per cent shareholding in the very successful business he has run for many years of Company P;
o)Property L, owned by Company P;
p)Shares in Company Q;
q)Shares in Company R;
r)Shares in Company S;
s)Assets of the Company S Family Trust;
t)Company S Superannuation Fund;
u)Loan to the Company S Family Trust;
v)Household contents;
w)Significant watches and jewellery in both parties’ possession; and
x)The wife’s property at Suburb A.

Facts/ Chronology

The agreed facts are as follows.
The wife was born in 1969 and is a national of Country A.
The husband was born in 1969 and is an Australian.
The wife and husband each have children, all over the age of 18 years but not of their relationship.
The husband registered his successful business, on …1997. He owns 60 per cent of that company, and his partner, Mr S, 40 per cent. This partnership commenced trading in …1997.
The husband married his wife, the mother of his children, in 1999.
Perto Holdings, was registered in …1999. The husband has the one share and is the sole director and secretary of the company.
The husband’s son, [X], was born in …2003
The husband and his first wife separated in 2005 and divorced in 2008.
Their daughter, [Y], was born on …2005.
The husband and his current wife met in 2006.
The husband said they formed a relationship at that time.
His assets in December 2006 comprised no less than the property at Property G1; units 1, 2, 3 and 4 and the garage; Property F1; units 1, 2, 3, 4, Property H; Property K; his shareholding, in Company P; motor vehicles; and cash in his home.
The husband would assert his assets in December 2006 were no less than 13 million with debts of around 3 million, giving him perhaps net assets of $10 million. A wealthy man, a successful man, a very hardworking man. The husband says in December 2006 his income from Company P was $259,000 per annum and says he is still earning that same income today.
That assertion together with other financial matters are raised as issues by the wife in her exhibit 9. I too have some consternation relating to the husbands financial disclosure and material comprised in wife’s exhibit 9 arising from a review of the exhibits to which I will later refer.
In 2006, the husband said he leased a Motor Vehicle 4 for the wife. The wife was provided with a further five leased vehicles during the relationship, all leased and paid for by the husband. One vehicle was worth in the vicinity of $220,000. At separation the wife’s vehicle was seized by the husband and the wife has no car presently.
The husband says the wife had no assets and debts of $44,000. This may or may not be correct and has no bearing on the spouse maintenance application.
The wife was working in December 2006. As a Country A national she was employed as a tradesperson earning about $60,000 per annum.
The parties commenced co-habitation on …2007.
In 2008, the wife wished to start up her own business which was a …business. The husband spent some $40,000 on premises, renovation and the like. The business was not successful and was closed after six months.
The wife says from 2008 up until about August of 2018, when the parties physically separated and the wife was excluded from the former matrimonial home, the husband paid her between $1,200 and $1,500 per week. The husband corroborates this evidence in his material
The husband’s affidavit of 26 October 2018 states that he paid out and paid for the wife’s credits cards, provided her with substantial cash, created a part-time businesses for her family, paid for her daughter’s private school fees this commences at paragraph 28 of the affidavit of 26 October 2018:
During the relationship I put weekly amounts of money ranging from 1000 to 5000 dollars into Ms Coomb’s bank account. I gave her large sums of money by way of cash and cheque, ranging between 12,000 and 50,000. She would use these sums and my credit card to purchase clothing, items of jewellery, expensive handbag, shoes and the like.
The husband sets out in paragraph 29 of the affidavit of 26 October 2018 that he bought his wife:
a)a Cartier bracelet worth $12,000
b)a diamond ring from …Jewellers worth $13,000
c)a five-carat diamond ring from …Jewellers worth $140,000
d)three diamond rings from a Mr T, who is a jeweller in Suburb D, ranging in price from $35,000 to $60,000 and
e)a …bracelet worth $35,000.
The husband says he gave to the wife moneys that were used by her to of open up term deposits. He says in paragraph 32 of the affidavit of 26 October 2018 that he gave the wife $23,000, $30,000, $10,000, $50,000, $40,000 and $99,000 for this purpose.
The wife agreed she opened up term deposits with money the husband provided her and at separation had over $200,000 in various bank accounts and term deposits. This was all from moneys the husband provided to her during the relationship and the marriage and is money she has been living off since physical separation. Presently the wife has $66,000 left.
It is clear that the husband was a most generous husband. The parties lived a lavish lifestyle, and they had sufficient income to indulge in all their lifestyle choices, including for both of them gambling at an extremely high level – for the wife, in an 18-month period pre-separation, over $2 million, and the husband approaching $3 million.
Yet each appear to be proficient gamblers, having lost not even five per cent of the money they gambled. These were people whose income streams were such that they could gamble in a period of 18 months something approaching $2 million losing very little. A lavish, cash-rich, indulgent lifestyle.
In 2009, the husband replaced the wife’s Motor Vehicle 4 with a Motor Vehicle 2 at a cost $110,000.
On …2010, the parties were married.
The husband registered Company S in …2011, and up until these proceedings commenced, he had been the sole director and shareholder of that company. Some two weeks before the husband commenced the proceedings as set out in wife’s exhibit 5, Mr R, the husband’s Accountant was registered as the Company office holder. The ‘Change to Company Details’ form was registered on 10 October 2018 and appointed Mr R, the husband’s accountant, as the director and Secretary of Company S.
This step had purportedly been carried out on 15 December 2017 when the husband purportedly resigned as a director and secretary and his accountant took over those roles.
The difficulty I have with this evidence is that Mr R is not on affidavit, and the notification of this purported change was not registered by Mr R until two weeks before the husband commenced these proceedings and nearly 12 months after the purported transfer. It is safe for the court to assume that prior to commencing these proceedings the husband would have been in deep discussion with his accountant given his extensive land and company shareholdings.
On 24 February 2011 a deed of settlement established the Company S Family Trust. The trustee of the trust is Company S, who was effectively the husband prior to the registration of the change of details which replaced the husband with Mr R
The husband is still a specified beneficiary of the Company S Family Trust and also the guardian of the trust. Clause 27 of the Trust Deed gives the husband the power of appointment of the trustee. It is the wife’s contention that this trust is the alter ego of the husband. That is not a matter for me today in particular, however the former matrimonial home is owned by the Company S family trust and this is an important fact.
Company Q was registered in June 2011. The husband and Mr S are directors of that company in a 60/40 split. The husband holds six shares and Mr S four shares.
The Company S Family Trust completed the purchase of the former matrimonial home at Property J for $1,650,000 on …2011. The wife was excluded from that home in August 2018.
A company known as Company T was registered on 18 September 2013. That company is known as Company T, and the husband asserts he has a debt to that company. The current director of that company is Mr V.
The wife purchases the property at Property A in her sole name in February 2013.
On 30 January 2014, the husband registered Company U and the 10 ordinary shares are held, 6/4 in favour in the husband, with Mr S.
On 21 February 2014, the husband and his first wife resolve their property dispute and orders are made
In May 2014, the husband and wife purchased Property L, for $778,000 in their joint names.
The parties purchased in their joint names Property C, for $650,000. The wife now lives in that unit by agreement.
The husband says that from November 2014 to February 2015, the wife worked at …Employer and undertook a …course in July 2016. The wife disputes this.
Apart from these disputed vignettes it is common ground that from the commencement of the marriage, the wife has not worked in paid employment, nor has she undertaken any course, or training to skill her up to obtain employment in the marketplace. The wife is 49 approaching 50.
The husband incorporated Company P1 on 31 October 2016 and Company P2 on 1 November 2016. He and Mr S hold the shares in those companies in a 6/4 split in the husband’s in his favour.
The husband says the parties separated from November 2016 until about July 2017. This is disputed by the wife. It is agreed that the husband supported his wife during this time.
In February 2017, the husband, as trustee of the Company S Family Trust, purchased Property D, for $688,000.
The parties resumed cohabitation in July 2017.
The wife lodged $90,000 in a term deposit with the ANZ bank on 1 July 2017, which matured in August 2018.
On 25 August 2017, the parties purchased in their joint names at Property E for $430,000.
The husband represented to …Bank in 6 September 2017 and the Commonwealth Bank around the same time that he had assets of some $16,700,000. The husband contends the parties separated in March 2018. This is denied by the wife.
The wife says they lived together, had sexual relationships and holidays to their property in the Property E after this time.
The wife transferred $50,520 from her ANZ Bank interest-bearing deposit into her ANZ access account on 23 April 2018.
The wife says the parties separated in August 2018 but remained living under the one roof.
The wife’s $90,000 matured with the ANZ bank on 13 August and she transferred that money to her ANZ access account. The wife had $116,000 in an ANZ Bank access account ending …and $94,000 in an ANZ Bank offset account ending …between 13 and 14 August 2018.
On 24 September 2018 the husband ceased paying any money to the wife. Up to that time, and on his own evidence for at least 10 years he had paid her at minimum, directly and up to $1,200 a week and all her credit card purchases.
On 12 October 2016, the husband’s solicitors wrote to the wife’s solicitors stating that the parties could remain under the one roof, that the husband had no intention at the present time of changing that status quo in relation to residence.
On 17 October 2018 by letter the husband informed the wife that he would be making an application for exclusive occupation of the home.
The husband had taken the wife’s motor vehicle, on October 2018.
On 23 October 2018, perhaps a step that the husband may regret in the future was taken. The trustee of the Company S Family Trust told the wife that she would be excluded from the former matrimonial home as from 24 October 2018.
These proceedings were commenced by the husband.
At this time the wife had no idea that Mr R was now the director and secretary of the Company S Family Trust.

Exhibits

The husband has filed three financial statements in this matter. I accept financial statements in matters of this complexity are difficult and may not assist either litigants or the court however careful completion of the document is required.
The subpoenaed material, as I have said, is extensive.
For the husband, the exhibit are as follows.
Husband’s exhibit 1, a bundle of documents relating to the wife’s gambling in the Star City Casino, and the Region 1 for 18 months prior to separation.
Husband’s exhibit 2, wife’s cash withdrawals from her ANZ bank account ending …, for the period 1 July 2017 to 3 October 2018.
Husband’s exhibit 3, cash withdrawals of the wife’s ANZ account ending …, for the period 1 January 2018 to 26 November 2018.
Husband’s exhibit 4, the wife’s ANZ account showing cash withdrawals for the period 1 January 2018 to 12 November 2018.
Husband’s exhibit 5, wife’s ANZ bank account: the balance of that bank account as at 31 December 2018 and two screenshots of its current balance, which is about $66,000.
The Wife’s exhibits are as follows.
Wife’s exhibit 1, an aide-mémoire produced by her Counsel, Mr O’Ryan QC, of the parties’ assets, income, salary, tax, mortgages, loans, liabilities distilled from the husband’s three financial statements filed 25 October 2018, 21 December 2018 and 4 January 2019, showing the differences in each.
Wife’s exhibit 2, a bundle of documents in relation to the husband’s Westpac account ending …, showing a deposit of $2,052,813; into the husband’s Rocket statement in 2015.
The husband says this is not his money, it has been ‘loaned’ to him by Mr V as a director of Company T as an offset, is repayable on demand, and that he ensures there is always sufficient money in this account to instantly repay the money. There is a mingling of the husband’s income, and his business and personal expenses with this ‘loan’.
Wife’s exhibit 3, documents from the …RSL and Star City casino, Sydney – the last 12 months – showing the husband’s gambling. Both these parties gambled heavily. They spent millions of dollars in gambling. Fortuitously, they appear to lose very small amounts of money. Each carry out this activity. Clearly, they have carried it out together at times.
Wife’s exhibit 4, schedules of payments made by the husband on his credit card. They are revealing in that – for example, in his …Bank credit card: he deposited $20,000 on 9 February 2018, $10,000 on 3 January 2018, and depositing some $128,000 into this credit card in a 12-month period.

For the husband’s American Express: $62,000 paid in 12 months, for example, $30,000 on 18 January 2018 having expended some $24,000 during that period of time.
The husband asserts his 4 credit cards are all approaching their maximum limits around the $35,000/$34,000 debit balance.
The husband submitted that if I looked at the wife’s expenditure on her credit cards and in her bank statement, I will see excessive expenditure at Star City Casino, liquor outlets and restaurants. This is correct pre- separation.
When one looks at the wife and husband’s credit card purchases money is expended by each of them at liquor outlets, casinos, for food and the like pre and post separation.
It is impossible to distinguish in the husband’s credit card statements what is personal expenditure and what is business. I know the wife’s expenditure is personal and is less than the husbands. As part of his case he had no capacity to support his wife he was unable to assist me either. Frankly only the husband can tell the Court and his wife what is a business expense and what is a private expense, and thus a submission that the many large expenditures on food and alcohol are for business purposes cannot be sustained.
I accept there is a mixing of private and business expenditure on each of his four credit cards, perhaps not the wisest approach to take in these circumstances. However that is as far as it goes.
The husband says in his latest financial statement his liabilities on credit cards is $89,968.
Wife’s exhibit 5, the ASIC search of Company S showing that there was a purported meeting changing the director and shareholder in December 2017 to Mr V, not registered until 8 October 2018. The wife will call for the records of that meeting and of that change.
Wife’s exhibit 6, correspondence of solicitors when the parties first separated seeking particulars of the husband’s financial dealings together with tax returns of the Company S Family Trust provided by the husband. They are not documents you would lodge with the Tax Office. They would be rejected and are incomplete and perhaps they are drafts.
Wife’s exhibit 7, documents provided by the husband for the Company S Family Trust, being I hope, draft profit and loss statements and tax returns for the years ended June 2015 to 2018. The statements contain many errors and omissions. For example a claim has been made for strata levy expenditure in respect of the Property D property which is a fee simple property, for a number of years and from 2015. The trust acquired a strata unit in 2017. There are blanks in the documents and nothing has been signed.
The husband claims in part he funds his excess of expenditure over income via Directors loans. There are director’s loans in 2015/2016 financials of $348,000 and $319,000 in 2016/2017 financials.
There are significant difficulties with the documents produced by the husband and tendered by the wife to support the Company S Family Trust position contended for by the husband.
Wife’s exhibit 8, Commonwealth Bank loan documents in relation to the purchase of Property D, pages 14 and 15 where the husband asserts he has assets of $16 million and an income similar to that which he declares in his financial statement.
Wife’s exhibit 9: Company P for the period end tax years 2016 and 2017 – these documents are relevant to the husbands claim of an incapacity to support his wife

The Law

The first test under section 72 of the Act[7] is whether the wife fulfils the threshold test. It was urged upon me that the wife does not because she has not provided any information or details of any attempt by her to get any job whatsoever. However, the wife has had no training or experience for work since at least the marriage and has not worked for 10 years. That is a fact, and there is nothing the husband can do about that.
[7] Above, note 1.
This is an interim hearing. I cannot make findings of facts on a contested matter. I listen to what the parties say and I accept what the parties say unless I can be persuaded they are wrong by cogent or persuasive evidence. It is a fact that this wife has not worked in any meaningful sense earning income since at least 2010 and it is now 2019. She is 49 years of age, soon to be 50. She has not obtained skills, qualifications for any job in that time and has had no relevant work experience in those 10 years that I can see.
Decisions such as of Hall & Hall[8], a decision of the High Court where they briefly touched upon what they called the gateway – what we refer to as the threshold test in section 72 of the Act[9], has not changed the old law, Bevan & Bevan[10], or the old cases. That matter did no such thing and the well-established principles going back to the commencement of the Family Law Act[11] and the old cases are still good law.
[8] Hall & Hall [2016] HCA 23.
[9] Above, note 1.
[10] Bevan & Bevan [1993] FamCA 95.
[11] Above, note 1.
This is not a final maintenance hearing. This is an interim hearing pending these parties resolving their matter. They recently separated. Their separation has been acrimonious and made far more difficult than it should have been by the actions of the trustee of the Company S Family Trust in excluding the wife from the former matrimonial home.
Fortunately, sense prevailed and the husband agreed to allow the wife to live in Property C and he will continue, as he has always done, to pay the mortgage. The husband has been the only party in this marriage to earn income. The financial contribution by him to the current assets of the parties, to the wife, to the wife’s child and perhaps even to members of her family is, as I see it even on interim basis, overwhelming.
He was a wealthy man when the parties commenced cohabitation. He is still today a wealthy man as he was at the cessation of the relationship. His affidavit is testament to the extravagant lifestyle they led as a married couple during their marriage. He provided expensive motor vehicles to the wife when they commenced living together, prior to the marriage. He has provided her with 6 motor vehicles during the marriage.

Findings

For today’s purposes I accept the following.
That the wife rarely cooked.
That they had eight housekeepers.
That he would put $1000 to $5000 into her bank account regularly, see – paragraph 28 of his affidavit of 26 October 2018.
That the wife would use his credit card in addition to cash sums he would pay those credit cards.
That he provided her with jewellery well over $200,000 set out in paragraph 29 of his affidavit.
That he had cash in his home of $150,000 when they commenced cohabitation. He says the wife used this money.
That the wife spent $35,000 in Darwin on one holiday period, paragraph 31 of his affidavit.
That he provided her, as he asserts at paragraph 32, with various amounts ranging from $5,000 to $150,000 to enable her to open up term deposits in her name.
Their first and longest separation was November 2016 to July 2017, this is denied by the wife. However the husband supported his wife and deposited $1000 a week into her account and topped it up with sometimes as much as $5000, paid out all her credit cards and expenses in relation to the Property B apartment.
The reason the husband gave in his affidavit of 26 October 2018 for ceasing to support his wife is at paragraph 39:
And I continued paying the $1200 into her account weekly from separation until I received a text from her on 10 September 2018 informing me she did not want the money and had enough. The last payment was made on 17 September 2018.
That alleged text message from the wife was not in evidence and is denied by the wife. It is also inconsistent with the wife’s’ expenditure and behaviour during the marriage and the manner in which the wife was supported namely 100% by her husband.
The parties acquired 5 significant items of expensive real estate during the marriage and 2 further properties via the Company S Family trust being the former matrimonial home at Property L and the units at Property D.
The parties expended vast amounts of money during the marriage. The wife may have continued to spend money as she did during the marriage and has spent $70,000 on her personal needs since August 2018. I accept the wife had about 6 weeks to accommodate herself in that time.
Similarly the husband has continued with his spending patterns post separation and from the limited material I have his spending habits have not changed.
On these facts I find the wife clearly fulfils the threshold as a spouse unable to support herself adequately on an interim basis as she has no employment, has not had employment for at least ten years and has no training or skills for employment that would enable her to support herself ‘adequately’ having regard to the length of the marriage and the lifestyle enjoyed by the parties.
I find the reasons for the wife’s incapacity to support herself adequately at this stage are; her age, lack of skill or training, lack of employment in 10 years, length of the marriage and lifestyle enjoyed by the parties.
Contra the husband’s income, property and financial resources which is vast. Much of it has been acquired during the 10-year marriage, the 14-year relationship, if the wife’s case be correct. Yet apart from the property at Property A and the property she lives in, most of the assets of these parties are the husband’s, as some of them were acquired by him before marriage or cohabitation, or are owned by the Company S family trust such as the former matrimonial home. Pertinently the income-earning asset, Company P, was incorporated by him well before the party’s commenced co-habitation.
The properties that the parties acquired during the relationship jointly at Property L; Property C, where the wife lives; Property J; Property E; and Property A, which is in the wife’s name, are mortgaged and may not provide a positive income as the husband asserts. Thus the only income producing or positive asset that the parties have is, on the husband’s evidence his business interests, which are totally controlled by him. The wife has no access or control at all.
The parties have separated. The standard of living they enjoyed during their relationship was very high, the husband’s own affidavit tells me that; I need not go to the wife’s affidavit. It cannot be correct that merely because you have separated, you need then to live, to use the vernacular, on the smell of an oil rag while the other party, who is in control of the majority of the assets and the income earning asset, continues to live as they did previously in the same former matrimonial home and continuing on with their life as it was pre-separation. The wife is exactly on the other side of the fence in this case.
The wife requires maintenance to be paid to her so she can maintain living in the Property B property pending a final resolution. It now behoves her to start to look for employment or engage in training or undertake courses to prepare herself for employment if that be possible. The question of whether the wife has an income earning capacity in the future is a matter for a final hearing and the wife needs to be prepared for that proper enquiry.
On an interim basis the wife is unable to support herself at all let alone adequately.
The wife’s case is she contributed significantly to the increase in the husband’s wealth. Many properties were purchased by them during their relationship, other businesses were opened up, that she was an integral part in these endeavours, particularly with her … Nationality background, and in an area such as Suburb A, which has a large …Nationality population; her contribution has been significant.
The duration of the marriage was in excess of 10 years. The relationship may have been for longer. The relationship has impacted upon the wife’s capacity to earn an income, because she did not need to be a tradesperson earning $60,000 a year when she married this wealthy man, and they chose the life they wished to live.
I find on an interim basis, the wife clearly fulfils the threshold test and I reject any submission to the contrary.
Going now to her reasonable needs.
The wife says her needs are $1938 in her financial statement. Mr O’Ryan QC her Counsel broke that up into $1487 for her personal needs, gas and electricity for her unit, rates strata’s levies for her Property A unit and re-inclusion in the BUPA Health Fund at the top level.
Looking at her needs at Part N of her financial statement. I do not accept her reasonable needs are $150 for clothes and shoes, $400 for food or $312 for hairdressing weekly. They are excessive amounts but are reasonable needs.
Another approach is to ascertain what the husband says are his reasonable personal needs. He says absent rent and including gas and electricity they are $810 a week. I see little reason why the husbands’ reasonable needs and the wife’s should not be of a similar amount and there is an element of fairness to such an approach.
However, his needs do not include, telephone, motor vehicle expenses, petrol, as these are no doubt paid buy his business. His entertainment at $40 a week is not reasonable given the parties lifestyle and that the husband‘s entertainment may be a business expense. The parties lavishly entertained during the marriage. They gambled significant sums of money, going out nightly for meals, enjoying holidays, purchasing expensive jewellery and other items.
Additionally, they do not include the wife’s’ reasonable expenses such as hairdressing, cigarettes, and strata levies.
The wife proposes to buy herself a car, given the husband took hers away, from part of the money she has left in her bank account at around a cost of $30,000, thus I must include for the wife those costs: the registration, fuel, petrol, and insurance for that car, and I would allow her $150 per week.
The wife must have her telephone paid at $39. She is entitled to entertainment at $110 given the parties lifestyle and that much of the husband’s entertainment may be a business expense. Cigarettes at $140 per week and hairdressing at $50 a week are reasonable and necessary.
I accept the wife has a shortfall in meeting the strata levies for her property at Property A from the rental income. Amortised over a year this is $60 a week and I will allow her that expense.
Thus in addition to the husband’s reasonable needs at $810 the wife also has the following additional needs:
a)Telephone $39
b)Car expense including petrol $150
c)Cigarettes $140
d)Strata levies $60
e)Hairdressing $50
f)Entertainment $110
A total of $549.
These total reasonable needs for the wife at $1359 weekly.
The wife enjoyed a top level of heath care during the marriage and this is also a reasonable need.
Going to the husbands’ capacity to pay what I have found are the wife’s reasonable expenses being weekly $1359 and top level BUPA Health cover.
The husbands’ evidence in his affidavit of 26 October 2018 at paragraph 39 was clear. He ceased to pay the wife $1200 a week because she said she no longer wanted the money not because, as he now asserts, he could not afford so to do. In the absence of a hard copy or evidence of that message, the wife’s denial of having sent any such message and the manner in which these parties lived their life I reject the husband’s evidence.
Mr Sansom’s submission was that he does not have a capacity to pay any money towards the wife’s maintenance.
This submission is contrary to the written material and the evidence.
The husband only declared the off- set, loan money, return on investment of some $2 million, which he says is money lent to him by Company T in his last financial statement filed 4 January 2019. He had filed two financial statements previously and neither the existence of this money in his bank account or the alleged loan were disclosed. This money was provided to the husband well before this litigation commenced.
The husband’s case is that as it is not his money and he did not believe he needed to disclose it. I find that explanation difficult to accept from a man of business. He says this money is in fact owned by Company T. He says “yes, it is in my account. Yes, I use this account day-to-day but if that money was asked to be paid back tomorrow, I could do that, because I made sure that my account always has sufficient to pay back the $2 million provided by Company T”.
Secondly, the reality is he has a credit balance in his Rocket account of no less than $2 million consistently, there is a mix of personal income, personal and business expenses mingling with this $2 million, he is asserting he cannot pay his former wife maintenance and yet fails to provide any independent documentary evidence of the breakup of his business and personal expenses in his bank account.
Thirdly, the independent documentary evidence he asks I accept as proof of the existence of this ‘return on investment’, ‘loan’ to Company T is disclosed in his current financial statement by a document entitled ‘Deed of declaration of Trust’ attached to his financial statement dated 4 January 2019.
The document is dated 1 December 2017. It is the first time the wife has seen it. In the typed document no names or entities are disclosed as being parties to the Deed on page one.
There is no description in the typed document of where the assets comprising the trust are held or of what they are on page one.
On the second page of the document Schedule 1 appears and this schedule discloses the beneficiary as Company T and the trustee as Mr Perto, yet these parties do not appear on the first page.
The schedule provides that the trust property is $2 million transferred by the beneficiary to the trustee.
Within the typed document is handwriting which states:
Declaration of trust: we hereby declare the trust as set out in the attached document as initialled by us and agreed to be bound by its terms.
Signed, sealed and delivered by the said trustee, Mr Perto, in the presence of, I cannot read the name–
executed for and on behalf of the beneficiary, Company T.
It is clear to me that the husband receives a benefit from this money and I struggle to accept that the husband did not realise he had an obligation to disclose this document and the money in his account. These are issues for a final hearing. The Deed of trust is a most unusual document being partly typed and partly handwritten with many blanks.
Going to the husband’s financial statement. He asserts his weekly income is $13,898 consisting of salary before tax, and income from his various rental investments. His total disclosed salary before tax is $4,984, a week about $259,000-$260,000 a year. If this be correct the husband’s income has not changed much in all the years he and the wife have been together.
When one goes to the only documents produced by the husband in relation to Company P, the major income producing group, being tax returns and draft financials for end of the financial year 2017 and 2016 (wife’s exhibit 9), there was directors remuneration of $460,768 disclosed for 2017 and $454,000 was also paid in 2016.
Only the husband and his partner, Mr S, are directors of this company, and their shareholding is 60/40 in favour of the husband. If I divide the Directors fees in this fashion that is $276,000 to the husband and $130,000 to Mr Perto.
The husband stated in his financial statement that he has not received a dividend from Company P this year 2018. There is no mention of director’s fees. His affidavit is silent on this relevant and important evidence.
The salary or wages in the financials from the Company P is $1,834,646, for 2017. I assume the husband’s salary is part of that figure and his share of any Directors fees is not.
Is it only in 2017/2018 that Company P is unable to pay its Directors a remuneration?
The husbands asserts in in latest financial statement that his expenses exceed his income by $5,000 per week and his submission was that he makes up the shortfall from directors loans and credit cards. The only objective evidence to support this assertion is wife’s exhibit 9. In 2016 directors loans for the husband with Company P was $402,060 and in 2017 $355,326, a reduction of $45,000. I have no document to support the 2018 financial year position.

I accept the submission by Mr Sansom that the wife has to prove her case and she has in terms of need and reasonable expenses. As to the third hurdle, the husband’s capacity, the wife must be able to say, my husband always supported me and simply stopped doing so some three months ago, and thus satisfy me he has this capacity unless I am persuaded some event has occurred or the husband’s evidence persuades me to the contrary. This is particularly so when the husband is in total control of the income producing assets and thus the financial history of those assets and has not been forthcoming with disclosure.
The husband has not persuaded me of his incapacity now to continue to support his wife as he always done. Indeed he has the capacity as I see it given the following evidence.
Significant Directors remuneration being paid in 2016 and 2017 and not disclosed in any financial statement or affidavit of any description by the husband.
A reduction in directors loans over those 2 years for both the Company S Family Trust and Company P not an increase and the absence of the 2018 position being disclosed in any financial statement or affidavit of any description by the husband.
No objective evidence to support the husband’s statement of no dividends being paid in 2017/2018 financial year by Company P.
The husband’s reasons set out at paragraph 39 of his affidavit that he ceased paying $1200 a week to his wife as she did not want the money and had enough, not that he was unable so to do.
Failure to disclose to the wife at any time that Mr R was from 2017 the Director and Secretary of the Company S Family Trust.
Failure to disclose the source or existence of the $2 million in his rocket account until his third financial statement.
Therefore on the evidence the husband has a capacity to pay to the wife her reasonable expenses as I have assessed them, and I will so order.

I certify that the preceding one hundred and seventy-six (176) paragraphs are a true copy of the reasons for judgment of Judge Henderson

Date: 1 February 2019

[2019] FCCA 172

1 February 2019

Key Legal Topics

Areas of Law

Family Law

Civil Procedure

Legal Concepts

Jurisdiction