Pezarro and Pezarro - [2007] FamCA 1474

FAMILY COURT OF AUSTRALIA

PEZARRO & PEZARRO

[2007] FamCA 1474

FAMILY LAW – PROPERTY DIVISION – Principles of determining the pool of property of the parties – Addbacks principles associated therewith – Chorn v. Hopkins – Third party intervenor alleging debt owed by one or both parties – Principles associated therewith including Part VIII AA of the Family Law Act 1975 – Binding Financial Agreement about maintenance – Part VIII A of the Family Law Act 1975 grounds on which the agreement might be set aside – Effect of one party owing a significant sum of money to a third party on distribution of property

Family Law Act 1975 (Cth)

APPLICANT:

Ms Pezarro

RESPONDENT:

Mr Pezarro

INTERVENOR:

Mr W

FILE NUMBER:

CAF 613 of 2003

DATE DELIVERED:

18 December 2007

PLACE DELIVERED:

Canberra

JUDGMENT OF:

Faulks DCJ

HEARING DATE:

24-27 October 2006

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Ms Haughton

SOLICITOR FOR THE APPLICANT:

Ray Swift Moutrage and Associates

FOR THE RESPONDENT:

In person

FOR THE INTERVENOR:

In person

Orders

It is ordered that:

(a) The husband pay to the wife the sum of $92,174 on or before 4pm on 18 March 2008.
(b)If the husband should fail to pay the said sum on or before the time indicated (or if he should earlier agree to do so) the husband will do all such things as may be necessary to cause the sale of the property at T, known as … being all of the land contained in Certificate of Title reference … and the improvements erected thereon.
(c)There be liberty on the part of the wife to apply about the terms of the sale.
(d)Irrespective of any other arrangements if the property should not be sold by private treaty on or before 18 June 2008, then the husband will forthwith do such things as are necessary to put the property up for sale by public auction.
(e)There be liberty to apply by either husband or wife about the terms of such auction sale.
Upon completion of the sale of the property the proceeds will be applied as follows:
(a)In payment of the costs of the sale, including real estate agents commission and legal fees in relation to the conveyance and the sale.
(b)The discharge of the mortgage of approximately $118,000 (at trial) over the property.
(c)In payment or in reservation of a sum sufficient to meet any liability for capital gains tax that may arise in relation to the sale of the property. The husband will instruct (at his own expense) Price, Waterhouse and Coopers to do a calculation of such capital gains tax for him and both parties will accept that calculation.
(d)Payment to the wife of such sum as represents 35 per cent of the total property pool as found by me in my reasons for judgment with the net proceeds of sale (after payment of costs, discharge of mortgage and capital gains tax) substituted for the $222,000 (the net value of the property used in the calculation…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Pezarro and Pezarro

Details

AGLC: Pezarro and Pezarro [2007] FamCA 1474
Case: [2007] FamCA 1474
Decision Date: 18 December 2007

CaseChat Overview and Summary

The decision in *Pezarro and Pezarro* concerned a dispute between a husband and wife regarding the division of their property and financial resources. The matter came before the court for final orders to be made.

The court was required to determine the appropriate distribution of the parties' assets, including real estate and superannuation entitlements, and to address the allocation of debts and liabilities. A key issue was the treatment of a financial agreement previously entered into by the parties, and the court needed to decide whether to uphold or set aside this agreement.

The court ordered the husband to pay a specific sum to the wife by a set date, failing which the property at T was to be sold. The proceeds of the sale were to be applied first to the costs of sale, then to discharge a mortgage, and then to cover any capital gains tax liability, with the calculation of which the husband was to arrange. The net proceeds, after these deductions, were to be divided, with the wife receiving 35 per cent. The court also made orders concerning the husband's Military Superannuation and Benefits Scheme (MSBS), entitling the wife to 22 per cent of certain payments from the scheme. Furthermore, the court declared the husband solely liable for a debt to an intervenor and ordered mutual indemnities between the parties for various other debts. The financial agreement of 8 June 2006 was set aside.

Orders

Orders of the court

It is ordered that:

(a) The husband pay to the wife the sum of $92,174 on or before 4pm on 18 March 2008.

(b) If the husband should fail to pay the said sum on or before the time indicated (or if he should earlier agree to do so) the husband will do all such things as may be necessary to cause the sale of the property at T, known as … being all of the land contained in Certificate of Title reference … and the improvements erected thereon.

(d) Irrespective of any other arrangements if the property should not be sold by private treaty on or before 18 June 2008, then the husband will forthwith do such things as are necessary to put the property up for sale by public auction.

(e) There be liberty to apply by either husband or wife about the terms of such auction sale.

Upon completion of the sale of the property the proceeds will be applied as follows:

(a) In payment of the costs of the sale, including real estate agents commission and legal fees in relation to the conveyance and the sale.

(b) The discharge of the mortgage of approximately $118,000 (at trial) over the property.

(c) In payment or in reservation of a sum sufficient to meet any liability for capital gains tax that may arise in relation to the sale of the property. The husband will instruct (at his own expense) Price, Waterhouse and Coopers to do a calculation of such capital gains tax for him and both parties will accept that calculation.

(d) Payment to the wife of such sum as represents 35 per cent of the total property pool as found by me in my reasons for judgment with the net proceeds of sale (after payment of costs, discharge of mortgage and capital gains tax) substituted for the $222,000 (the net value of the property used in the calculation of the property pool).

(a) Pursuant to paragraph 90MT(1)(b) of the Family Law Act 1975 whenever a splittable payment becomes payable to or on behalf of the husband Mr Pezarro from his interest in the Military Superannuation and Benefits Scheme (MSBS):

(i) The wife Ms Pezarro is entitled to be paid twenty two per cent (22%) of that splittable payment and;

(ii) There shall be a corresponding reduction in the entitlement which the husband would have had in the MSBS but for this order.

(b) The operative time for the orders will be four business days after service of sealed orders on the Trustee.

(a) Pursuant to part VIII AA of the Family Law Act 1975 the husband is declared to be the sole debtor as between him and the wife of the intervenor Mr W in these proceedings. The husband will keep safe and indemnify the wife in respect of any such liability.

(b) Each party will indemnify and keep the other indemnified against any debts in his or her name in particular the husband will indemnify the wife against any debt which may be due from him to S Pty Ltd (or any legal entity associated therewith) and to P Pty Ltd.

(c) In particular the wife will indemnify and keep the husband indemnified against any debts arising from or in relation to the company Z Pty Ltd or any entity associated therewith.

If all of the funds held in the Symons Phillips Solicitors trust fund (arising from the sale of the C property of the parties) on behalf of the parties have not been disbursed, the parties will cause those sums to be paid to them in the proportions of 35 per cent to the wife and 65 per cent to the husband.

The Financial Agreement entered into by the parties on 8 June 2006 is set aside.

Otherwise each of the properties is declared as against the other the owner both at law and in equity of any personal property in his or her possession or control.

All material produced subpoena which did not become the subject of exhibits will be returned by the Court to the persons producing it as soon as practicable.

Any material produced subpoena which became an exhibit will be returned by the Court at the expiration of the appeal period to the person producing it. Any material produced by a party which became the subject of an exhibit will be returned by the Court to the party at the expiration of the appeal period.

10.

The matter be removed from the Pending Cases Inventory.

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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