Pinkett and Pinkett

[2018] FCCA 712

FEDERAL CIRCUIT COURT OF AUSTRALIA

PINKETT & PINKETT [2018] FCCA 712

Catchwords:
FAMILY LAW – Property – leave to file property proceedings out of time.

Legislation:

Family Law Act 1975, ss.44(4)(a), (b), 79

Cases cited:

Althaus [1978] 8 FLR 169

Fields v Smith (2015) FLC 93-638
Pierce v Pierce [1998] FamCA 74
In the Marriage of Whitford (1979) FLC 90-612

Applicant: MS PINKETT

Respondent: MR PINKETT

File Number: SYC 5063 of 2017

Judgment of: Judge Henderson

Hearing date: 11 December 2017

Date of Last Submission: 11 December 2017

Delivered at: Sydney

Delivered on: 1 February 2018

REPRESENTATION

Counsel for the Applicant: Mr Andas

Solicitors for the Applicant: Swiftly Legal

Counsel for the Respondent: Ms Sproston

Solicitors for the Respondent: Catalyst Family Lawyers

ORDERS

1. Leave is granted to the wife to commence property proceedings out of time.

2. The matter is listed on 17 April 2018 at 9:30am for mention following the Conciliation Conference.

3. The parties are to contact my Associate in Chambers no later than 9 March 2018 to confirm they have complied with directions to allow the conference to take place which are to have complied with discovery pursuant to the Federal Circuit Court Rules 2001 and file a joint balance sheet by 9 March 2018.

4. The parties attend a Conciliation Conference on 28 March 2018 at 2pm with a Registrar.

5. Any documents required for the Conciliation conference are to be emailed to (omitted):

6. At least seven (7) days before the Conciliation Conference each party must send to the other and to the Registrar copies of:

   (a)a completed Conciliation Conference document, being a document setting out that party’s assertions as to:

   (i)the percentage share of the nett asset pool to which they are entitled;

   (ii)the respective contributions of each party to the nett asset pool (expressed as percentages);

   (iii)any adjustment to be made pursuant to section 75(2) of the Family Law Act 1975 (expressed as a percentage); and

   (iv)the facts alleged by each party in support of each of the foregoing (set out as a summary in ‘dot point’ form).

   (b)a market appraisal or valuation of any asset or financial resource, the value of which is in dispute and valuations of any superannuation interests;

   (c)if there is a significant discrepancy between the market appraisals obtained by the parties, a single expert valuation of all relevant property;

   (d)the actual terms of orders required to give effect to their settlement proposal;

   (e)a written confirmation by each party or their solicitor that:

   (i)all relevant documents have been exchanged between the parties

   (ii)Rules 24.03 and 24.04 of the Federal Circuit Court Rules 2001 have been complied with; and

   (iii)the superannuation trustee of any fund that may be the subject of a splitting order has been accorded procedural fairness

7. Prior to the Conciliation Conference a lawyer must give to their client a written notice setting out:

   (a)the actual costs and disbursements incurred by the party up to and including the event; and

   (b)the estimated future costs and disbursements of the party up to and including each future court event.

8. The parties attend Court together with their legal representatives one hour prior to the conciliation conference in order to have negotiations.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYC 5063 of 2017

MS PINKETT

Applicant

And

MR PINKETT

Respondent

REASONS FOR JUDGMENT

1. This is an application by a wife to commence property and spousal maintenance proceedings out of time. The application is opposed by the husband. Mr Andas appeared for the wife and Ms Sproston of counsel for the husband.

2. The evidence was as follows:

   a)For the wife:

   i)Application, affidavit and financial statements filed 17 August 2017;

   ii)Amended application affidavit and financial statement filed 1 December 2017; and

   iii)Affidavit of Dr A, her psychologist, filed 14 September 2017.

   b)For the husband:

   i)Response, affidavit and financial statement filed 27 October 2017.

3. The husband tendered three exhibits.

4. First was a statement of his, current and as at separation value of his superannuation.

5. Second exhibit was a loan application by the wife to purchase a car.

6. Third exhibit was pictures of a (omitted) of the wife’s at (business omitted) where she sells (goods omitted) and the like.

7. The relevant chronology is as follows:

8. The wife was born on (omitted) 1959, the husband on (omitted) 1969.

9. They married on (omitted) 1992.

10. Their first child, Mr A, was born on (omitted) 1999, [X] on (omitted) 2002 and the wife had a child of a prior relationship, Mr B who was born on (omitted) 1989.

11. In (omitted) 2010, the wife went to (country omitted) with the children for a holiday for six months. The husband visited them in 2011.

12. The parties separated on 17 November 2011.

13. The wife said it was June 2010 so just after she went to (country omitted).

14. The children come back from (country omitted) to visit their father in 2012 and they stay with him.

15. The wife commences Hague proceedings in July 2013 and the children are ordered to be returned to (country omitted).

16. On 17 September 2013, the parties divorce.

17. The wife is hospitalised in a psychiatric unit in (country omitted) from (omitted) to 2 (omitted) 2013.

18. The Divorce Order was made final on 18 October 2013 and the children and wife returned to Australia in (omitted) 2014. They lived at the home of the father at (omitted) until about June 2014 when the mother left.

19. The children remain living with their father.

20. The youngest child is aged 15. The parties have a form of an equal time arrangement of parenting the children and the father pays child support to the mother at some $122 per week.

21. On (omitted) 2016, the husband’s father deceased and the husband received an inheritance from his father’s estate of $336,202.

22. The facts are that at separation, these parties had no assets other than a car and superannuation. The wife had some 30-odd thousand and the husband about 44 thousand odd. The reality is the money that the husband has in the bank today is money from his father’s inheritance.

23. There has been a delay of about 4 years from the decree nisi becoming absolute and 3 years from the limitation period to the wife filing her application. Her initiating application was filed on 7 August 2017.

24. The wife has the onus to establish her case being and explanation of the reason for her delay and that there would be hardship caused to her if leave was not granted pursuant to section 44(4)(a) or (b) of the Family Law Act 1975 (Cth). That is the leave provisions.

25. That section reads as follows:

    (4)  The court shall not grant leave under subsection (3) or (3A) unless it is satisfied:

    (a)  that hardship would be caused to a party to the relevant marriage or a child if leave were not granted; or

    (b)  in the case of proceedings in relation to the maintenance of a party to a marriage--that, at the end of the period within which the proceedings could have been instituted without the leave of the court, the circumstances of the applicant were such that the applicant would have been unable to support himself or herself without an income tested pension, allowance or benefit.

26. Thus, the test under 44(a) for leave for property proceedings and (b) for maintenance proceedings is somewhat different. For property proceedings there must be established what the delay is and some reason in respect of the delay but in relation to maintenance is a specific issue.

27. Going now to the wife’s application for maintenance. The relevant date is 19 October 2014, being one day and a year after the decree nisi was pronounced, that is the date the decree nisi became final.

28. The question for me in relation to the maintenance issue is what was the wife’s capacity to support herself at that time, that is, 19 October 2014.

29. The wife was admitted to the (omitted) Mental Health facility at (omitted) in late March 2014. When I look at her affidavit of 1 December 2017 paragraph 75:

    In June 2014, the children are returned to Australia. We lived in Mr Pinkett’s home. Mr Pinkett was responsible for the family’s financial support where I was primarily responsible for maintaining the home and the children and various domestic tasks. These arrangements remained in place until I left Mr Pinkett’s home in 2015. I was diagnosed with bi-polar type 1 and post-traumatic stress disorder in September 2013. Diagnosed with depression, anxiety disorder, arthritis,…

30. She has not had a job as she says in her affidavit. The wife asserts in her affidavit, and it’s not disputed by the husband, in fact, he agrees with this that he was, and he would say has always been, financially responsible for his family and he has always provided the support for the family and the wife, therefore, was left to do the parenting and homemaking.

31. The husband says, at paragraph 50 of his affidavit:

    Early after her arrival in Australia, Ms Pinkett applied for social security benefits and I understand she has been receiving them ever since.

32. Paragraph 49 from the return in June 2014:

    I have paid and continued to pay 100 per cent of the children’s major costs.

33. On 22 August 2014, Ms Pinkett was sent a superannuation withdrawal form from (omitted) Superannuation and withdrew the full balance, some $30,000 which is what the father thought the balance.

34. The husband asked her to make some contributions and she refused. Paragraph 53:

    During mid to late 2014, Ms Pinkett was admitted to (omitted) Mental Health  in (omitted) for a period of about two to three weeks. After release she saw a psychiatrist at (omitted) Hospital on a monthly basis and was attending regular psychological sessions with Dr V.

35. The husband says the wife has a way of making money (employment omitted), and (omitted) and the mother herself has disclosed to her psychologist that she had started buying some (goods omitted).

36. As I read both the husband and wife’s material, the wife has clearly made out her case that as at the relevant date she could have brought an application for maintenance, not needing leave as she was clearly a spouse who was unable to support herself and was required to be supported and couldn’t support herself other than by way of social security benefits. That is clear to me o the facts of the matter, both from the husband and the wife.

37. I will now deal with the leave issue to commence proceedings under section 79.[1]

    [1] Family Law Act 1975 (Cth), s 79.

38. That is a more vexed issue and the test is somewhat more difficult than it is for the maintenance. The wife needs to address the delay and I need to assess hardship both to the wife and the husband in bringing or in allowing or not allowing the wife to bring her application for property proceedings.

39. The reality is, at the date of separation – the wife says 2010, the husband November 2011, as at the date of the decree nisi was pronounced and the expiration of the period within which the wife could have brought her application, the parties had no assets other than their superannuation which the wife had cashed in and also the husband had a car. The wife withdrew her superannuation in August 2014. The husband had $44,051 in superannuation. He currently has $134,000 in superannuation so the vast majority of that has been accrued since separation.

40. However, the case law is clear in relation to property applications. The contributions of a spouse to assets in one or the other’s hands is not just during the marriage, it’s the whole of the relationship and parties can, post-separation continue to make a contribution to assets in one party’s hands or the other. That contribution can be, as it would be here with the wife, a parenting and homemaking contribution which has yet to be assessed by the court. For that proposition, you would look at the matters of Pierce & Pierce[2] and the matter of Fields & Smith[3].

    [2] Pierce v Pierce [1998] FamCA 74.

    [3] Fields v Smith (2015) FLC 93-638.

41. The wife’s case is she was unable to bring her proceedings due to an incompetence or inability from proceedings commenced in (country omitted) against her father and grandfather initially for sexual abuse of she and her sisters when they were children. This is pleaded in her affidavit and in Dr A’s report attached to her affidavit, it is also referred to at paragraph 2 of Dr A’s report she says this:

    Ms Pinkett’s father’s criminal trial had caused her severe stress when she consulted with me. This is understandable considering her significant history of trauma. I have suggested for her not to attend court proceedings because of her fragile state and the likelihood of major relapse, I suggest she see a GP. Based on the history obtained, I believe she should not have been able to initiate family law proceedings while the criminal trial was underway. The history of the events in the time she resided in (country omitted) at which time she commenced legal proceedings against her father’s suggests she was too ill with severe symptomology requiring hospitalisations. Her treating doctors in (country omitted) would be better placed to make comments as I saw Ms Pinkett in Australia after the commencing of proceedings. I understand she would have been in a worse state then than when I met with her and when she was, when I met with her, highly unwell with severe depression.

42. This is uncontroverted evidence as to the sexual assault matter, however Dr A did not come to court, give evidence, was not cross-examined and has based her report on self-assessment only and I accept all of those matters.

43. The applicant has had a clear prior history of poor mental health. It is referred to in the father’s affidavit as well and this has impacted upon her functioning at times and a continuing hospitalisation for mental health issues and a significant bout of pneumonia recently in Australia. This evidence starts at paragraph 36 of the wife’s affidavit of 1 December.

44. The wife says in paragraph 40 that on 12 July 2013, she filed a complaint with the Sexual Abuse Unit of (country omitted) Police in relation to child sexual abuse that she and her siblings suffered. She was diagnosed with bi-polar disorder in September 2013. She was hospitalised in the psychiatric unit at the (omitted) Hospital in (country omitted) from (omitted) to (omitted). She experienced suicidal ideation and psychotic mania and she was treated by her psychiatrist until she returned to Australia in (omitted) 2014. She says she experienced mood swings and severe depressive relapse when she was released from hospital and that commenced about February 2014.

45. She was admitted to (omitted) Hospital when she came back to Australia in (omitted) 2014 and went to see her GP to obtain medications that she had been prescribed in (country omitted) and she is continuing to see these people. She sees a Dr V, and a psychiatrist, Mr R. She was referred to the Black Dog Institute in May 2015 and she then went to see her current treating psychologist, Dr A on 21 September 2015.

46. Her father’s trial commenced on 2 December 2015 and she says she assisted the Crown with their case. She and her husband were separated living under the one roof and she left his home in June 2014.

47. The trial of her father commenced on 2 December 2015 and I accept this would have been a very traumatic period of time for the mother and perhaps disabling for her. However, that is one year after the limitation period expired and therefore the question is what was happening in the wife’s life from the date of separation, she says June 2010 to October 2014 one year after the decree nisi was pronounced.

48. On 17 September 2013 the decree nisi was pronounced and it was made final on 18 October 2014. What is happening in the wife’s life between those two dates and subsequently.

49. The wife filed the complaint against her father and grandfather in July 2013, just prior to the expiration of the limitation period about three months. On her evidence in her affidavit, mental health took a serious downturn at that time. That is in paragraphs 41 and 44 of her affidavit. Much of this deterioration occurred whilst the wife was in (country omitted) and so it is difficult for the husband to make an assessment.

50. The husband’s case on this issue is set out at paragraph 46 of his affidavit where he says he is aware she was hospitalised in (country omitted) on (omitted) 2013 to (omitted) 2013 and she had, at that time, full-time care of the children. These facts, that is the wife is in (country omitted), in a mental health unit, commencing proceedings against her father, being so seriously unwell you need to be hospitalised is supportive of the mother’s position of a poor mental health functioning at least three months or just prior to the expiration of the limitation period.

51. I am satisfied that the wife has explained the delay in bringing the proceedings on this evidence and it is clear that her mental health suffered and she continues to suffer but is particularly florid and poor from about that time of commencing proceedings against her father and, and her mental health has continued to be difficult, at times, for her.

52. However, it is also clear on the facts and is inescapable that, had not the husband inherited money from his father in 2016, no proceedings for property proceedings would have been brought because there was simply no money. Being satisfied that the wife has sufficiently explained her delay in bringing these proceedings, the question for me now is to hardship for both the parties.

53. It will clearly be a hardship to the husband if the property proceedings are instituted. The parties, on the wife’s case, separated in June 2010. Decree nisi was pronounced on 17 September 2013 became final one month and a day later and the expiration period was October 2014.

54. The husband had supported the wife and children up to 2015 and 100 per cent supported the children post-2015 and pays the wife some $126, $130 a week by way of child support for her care of the children. The husband inherited money from his father’s estate some six years after separation and some two years after the expiration of the limitation period. Given that the parties only had their own superannuation and a car, at separation, the wife has cashed hers in, it is understandable why neither party brought any property proceedings until after 2016.

55. It is an inescapable fact that, although I accept the wife’s reasons for delay, the proceedings were only brought after the husband inherited his money.

56. The other hardship to the husband, of course, is that if the wife is granted leave to commence proceedings, he will have to defend these proceeds, pay costs in relation to defending the proceedings and if he is successful and the wife is to receive nothing, he cannot recover his costs because she is clearly impecunious. So there is a significant hardship to the husband.

What is the hardship to the wife?

1. I was referred to the decision of Whitford[4] in relation to the issues of hardship. The court should not grant leave under subsection 3 or 3(a)[5] unless it is satisfied in the case of proceedings in relation to the maintenance of a party to – I withdraw that. Whitford[6] is:

   In our view, the meaning of hardship in section 44(4) is akin to such concepts as hardness, severity, privation, hard to bear, a substantial detriment. We consider that in subsection 44(4) the word should have its usual, though not necessarily it’s most stringent connotations and it’s impossible to lay down in advance what they would be.

   As a general proposition it might be said that the inability of an applicant to pursue a claim which, in circumstances of the applicant or a child of the marriage is trifling, will not cause hardship. Similarly, where the cost which the applicant will have to bear himself or herself are about as much or more than what they are likely to receive, ordinarily hardship would not result if leave to institute proceedings was not granted.

   The test is that the court should not grant leave under subsection 44(3) unless it is satisfied (a) that hardship would be caused to a party to the relevant marriage or to a child if leave were not granted.

   [4] In the Marriage of Whitford (1979) FLC 90-612.

   [5] Family Law Act 1975 (Cth), s 3, 3(a).

   [6] Above, note 4.

1. Hardship does not mean you have to prove poverty or need. Whitford[7] continues:

   Hardship may be caused to an applicant if leave were not granted to institute proceedings although the applicant is not in necessitous circumstances. Whatever the financial situation of an applicant, his or her loss of a prospective entitlement to property including money or his or her inability to have the financial and property relations of the party adjusted and resolved, may constitute the hardship.

   [7] Above, note 4.

2. Two broad questions. The first question is whether hardship will be caused to the applicant or child if leave is not granted and if you are not satisfied as to hardship that is the end of the matter, as Whitford[8] says.

   [8] Above, note 4.

3. Second, if you are satisfied there is hardship, then you must determine whether the court should grant or refuse the leave. This is an additional test, even if you find hardship. The mere loss of a right to institute a claim is not, of itself, hardship.

4. Now, the wife is also seeking interim costs of some $25,000 to pursue her claim for property that was inherited solely by the husband post-separation. How I assess this matter is that I must, again according to Whitford[9], as best I can, assess whether the applicant has a reasonable claim.

   [9] Above, note 4.

5. I’m not here to assess the property matter as such, just whether the applicant has a reasonable claim. In relation to spousal maintenance, the wife has a reasonable claim. I am satisfied she is unable to support herself adequately without a pension. The wife has no history of employment per se, is and has been unwell in mental institutions as well as hospitalised by pneumonia recently, has no work history, and this mental instability and vulnerability is a factor in her incapacity to work, has no or little skill base from which to draw to get work, has been on her own evidence supported by the husband which he agrees, all her life up to 2015 and continues to be by way of him paying her child support. The business that she has of (business omitted) is not, as I see the evidence before me today, sufficient to support herself or meet any needs, let alone reasonable needs and, on the issue of maintenance, leave ought be granted to the wife.

6. On the other side of the coin, the husband has an income. He is a self-employed (occupation omitted), says he earns about $1000 per week. He supports three children, the youngest is 15. He pays the wife child support and he is clearly, on his own financial statement, using his inheritance to support himself and his children as the income he earns, even if I included his social security income is $1500 per week and is insufficient to meet his necessary expenses of $2308 per week. So he is going out backwards $500 per week, it would appear on the evidence and I can only look at what the party’s evidence is.

7. Thus, on these facts, although the wife would fulfil the threshold test as a wife in need of maintenance, it may well be in any such application the husband has no capacity to pay her from his income. However, maintenance applications are not solely related to income and are to include and the Court must look at the totality of the financial resources of the party whose maintenance is being assessed and who is to pay the maintenance. Even if that money was entirely inherited, it is still a financial resource in the husband’s hands which the Court would look at.

8. Going to the wife’s claim for property. The wife’s claim for property rests upon her contribution as a parent and homemaker, as I see the evidence today, to the children pre and post-separation most particularly, which was at times a sole parent while she and the children were in (country omitted). I accept the husband supported the family and has always supported the family, including the wife, post-separation and is now solely supporting the children. I see no evidence of a direct contribution by the wife to the husband’s inherited money. Sometimes there is.

9. I see no evidence today of that factor but this is not a final hearing. The wife’s costs application of some $25,000 may well be greater than any money she would receive but I am unable to make that assessment today. I do not have all the facts before me. The wife may or may not receive more than $25,000. The hardship to the husband is that he will have to fund his answer to the wife’s claim and, if she is granted leave, with no prospect of having his costs paid if she is unsuccessful.

10. I was referred to the decision of Althaus[10], a 1978 decision in relation to this issue. This decision is authority that if the court accepts that the property claim should be heard, then it was unreasonable for a Judge to sever off the maintenance claim. That is what the judge did in that particular matter. In this matter, I find the wife has a spousal maintenance claim so there is no issue. It’s almost the reverse of Althaus[11] that I’m looking at here.

    [10] Althaus [1978] 8 FLR 169.

    [11] Above, note 10.

11. The wife, as I see the evidence, has a claim to agitate, being the assessment of her contribution post-separation as a parent and homemaker and has a clear claim for maintenance having regard to her financial position, the length of the marriage and the financial position both parties find themselves in and their financial resources.

12. My task today is not to assess her claim but whether she has one that has reasonable prospects. To not permit the wife to commence proceedings out of time when there has only been a delay of two and a half years in commencing proceedings in circumstances where the wife has been very unwell mentally, and I have accepted both delay and hardship to the wife, would be, as I see it, a miscarriage of justice to her

13. I accept the hardship that would be occasioned to the husband by granting the wife leave, however, I have assessed the hardship falls in favour of the wife and not the husband in these circumstances. Therefore, I grant the wife leave to commence her property proceedings out of time and the return date for that application to do with all the outstanding issues will be 17 April 2018.

I certify that the preceding seventy (70) paragraphs are a true copy of the reasons for judgment of Judge Henderson

Date: 23 March 2018