Priddle and Priddle and Ors (No.2)

Case

[2009] FMCAfam 876

19 August 2009


FEDERAL MAGISTRATES COURT OF AUSTRALIA

PRIDDLE & PRIDDLE & ORS (No.2) [2009] FMCAfam 876
FAMILY LAW – Application to discharge interim order for spousal maintenance – whether just cause to discharge order – whether change of circumstances sufficient to decrease award of maintenance – what is proper and just.
Family Law Act 1975, ss.72; 74; 75(2); 83
Priddle & Priddle [2009] FMCAfam 258
Lutzke & Lutzke (1979) FLC 90-714
Bevan & Bevan (1995) FLC 92-600
Applicant: MS PRIDDLE
First Respondent: MR PRIDDLE
Second Respondents: MR P & MS P
File Number: ADC 312 of 2009
Judgment of: Brown FM
Hearing date: 10 August 2009
Date of Last Submission: 10 August 2009
Delivered at: Adelaide
Delivered on: 19 August 2009

REPRESENTATION

Counsel for the Applicant: Mr Berman
Solicitors for the Applicant: Norman Waterhouse Lawyers
Counsel for First Respondent: Mr McGinn
Solicitors for First Respondent: Camatta Lempens Pty Ltd
Counsel for Second Respondent: No appearance
Solicitors for Second Respondent: Robert Chrzaszcz & Associates

ORDERS

  1. Orders 3, 4 and 5 of the orders of 25 March 2009 be discharged.

  2. The wife is given liberty to relist the matter at short notice in the event that any piece of the parties’ real property is sold.

  3. The matter be listed for final hearing for three (3) days on 15, 16 and 17 March 2010.

  4. The matter be listed for trial directions on 7 December 2009 at 9:30am.

  5. Liberty to apply.

IT IS NOTED that publication of this judgment under the pseudonym Priddle & Priddle & Ors (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
ADELAIDE

ADC 312 of 2009

MS PRIDDLE

Applicant

And

MR PRIDDLE

First Respondent

MR P & MS P

Second Respondents

REASONS FOR JUDGMENT

Introduction

  1. These proceedings relate to an order for interim spousal maintenance which I made on 25 March 2009, pursuant to which Mr Priddle “the husband” was to pay maintenance and provide other financial support for Ms Priddle “the wife”.[1]

    [1] See Priddle & Priddle [2009]FMCAfam 258

  2. Essentially, the orders provided that the husband would pay the following sums either to the wife or for her benefit:

    ·A weekly sum of $500;

    ·Lease and other expenses relating to a Lexus motor vehicle, which the wife retained;

    ·Mortgage payments and other outgoings in respect of a property situate at Property W;

    ·The sum necessary to ensure the wife maintained top level health insurance.

  3. Concurrently with the making of these orders, an order was made allowing the wife to have the sole occupancy of the Property W property, which is the parties’ former matrimonial home. The wife occupies this property with the parties’ two children, who are aged sixteen and fourteen.

  4. By his application filed on 30 April 2009, the husband seeks the modification of the spousal maintenance aspect of the order by a reduction of $500 to $150 per week, although more recently he has indicated that he wishes the amount reduced to nil.

  5. He also seeks that the lease on the Lexus motor vehicle be surrendered and the vehicle be returned to its owner, so that he is absolved from any obligation to maintain it for the wife’s use.

  6. In addition, although his application does not specify it as such, he seeks discharge from his liability to provide health insurance for the wife and to ensure the financial outgoings on the Property W property are paid.

  7. The personal circumstances of the wife are not in great dispute between the parties.  They are set out in the earlier reasons for judgment.  She is an invalid and has no capacity to provide for her own financial support.  Her medical condition is serious and not likely to improve.

  8. At the time of the making of the spousal maintenance order, the husband was in self employment as a [occupation omitted]. He operated this business on land at Property L owned by his parents,


    Mr P and Ms P “the parents”.

  9. The manner in which the husband has been self employed is through a company [Mr & Ms Priddle] Nominees Pty. Ltd.  Both the husband and wife are directors of his company.  There was a lease between the parents and [Mr & Ms Priddle] Nominees Pty. Ltd. in respect of the Property L property.

  10. The term of the lease was for a period of three years, expiring on 6 January 2003, with two further options to extend for periods of three years in each case.  The annual rental was $6,000.  It is the husband’s position that the lease expired on 6 January 2009 and has not been extended.

  11. In addition to the company, the parties were involved with a family trust, the [Mr & Ms Priddle] Family Trust. During the course of their marriage, the parties acquired a number of other properties, beside their former family home, which properties were tenanted. Income was directed into the family trust. There was and continues to be considerable dispute about the solvency of the company and family trust concerned and of the [omitted] business.

  12. In the past, a portion of the Property L property was sublet to United Petroleum for use as a petrol station.  United Petroleum paid rent to the trust.  It is the husband’s position that this sublease has also expired. 

  13. At the time of the making of the interim spousal maintenance order, it was unclear what income the [omitted] and petrol station business was generating.  In the past, income from the [omitted] business had been equally divided between the parties, whom I understand to be the only shareholders. 

  14. It was the wife’s position that the business was a viable one and that the husband was fit and able to operate it.  As such, she asserted it generated a reasonable income, which for tax purposes had been calculated as around $50,000 for the year ending 30 June 2008.  The wife asserted that this was likely to be an under rather than an over estimate of the extent of income flowing into the family.

  15. In the circumstances of the case, I considered $50,000 to be probably a conservative estimate of the husband’s income.  Accordingly I judged him to have the capacity to meet the spousal maintenance order, which I made.  It also seemed to me to be self apparent that it was in both parties’ interests that the mortgage payments on the Property W property be kept up to date.

  16. Both parties had a considerable attachment to the Property W property.  From the wife’s point of view, the property has been significantly modified to cater for her significant level of disability.  In the longer term, the wife aspired to retain the property. 

  17. The husband’s position was that he viewed the property as his home and he had no readily available alternative accommodation.  Given his age, he felt disinclined to move in with his parents.  It was also his position that it was likely that the Property W property would have to be sold, at some stage, to achieve an appropriate division of the parties’ pool of matrimonial property.

  18. Undoubtedly the sole occupancy issue generated considerable heat and controversy between the parties, who are not currently on good terms.  Both regard the other as being focused on out manoeuvring him or her to achieve a financial or emotional advantage in the case.

  19. The husband’s position is that he now has no capacity whatsoever to meet any aspect of the spousal maintenance order for the following reasons:

    ·The [omitted] business has suffered a decline in turnover due to the general financial downturn;

    ·He himself has found it difficult to work in the business because of problems relating to his psychological health, which have arisen as a result of understandable problems he has had in adjusting to his new circumstances following the breakdown of the marriage;

    ·No monies have been received by way of rent from United Petroleum for some time.  In the past this money had been paid to the family trust of which he, the wife and other family members were beneficiaries;

    ·The wife has withdrawn a sum of $26,139 from the business account on 31 March 2009, which has affected its liquidity significantly.

  20. The husband calculated the weekly costs of meeting the spousal maintenance order as follows:

    Lease payment on Lexus   $156.69

    Associated costs on Lexus   $14.02

    House payments   $567.00

    Spousal maintenance order  $500.00

    Total:  $1,237.71

  21. It was the husband’s position, at the time of the making of his application on 30 April 2009 that, at best, his income was around $800 per week.  As such, it was self apparent that he could not meet the order.  Obviously, the above calculations did not take into account his own living and accommodation expenses. 

  22. The husband was also aggrieved that the wife had recently sought an administrative assessment of child support. His liability for child support was assessed in a sum of $160 per month. It was his understanding that the wife would not seek such an assessment, given the terms of the spousal maintenance orders.

  23. The parties’ investment properties are situated in Property L; Property S; and Property K.  Each of these properties are tenanted; subject to mortgages; and negatively geared.  As such, it is the husband’s case that these properties do not generate income which is readily available to him. 

  24. The operation of the business has been funded by a line of credit secured against the former matrimonial home.  It is the husband’s case that a number of withdrawals of funds, made by the wife against the line of credit, have pushed it to its limit and he now has no access to funds.  Again, it is his position that this has effected the viability of the business.

  25. In all these circumstances, the husband’s position is that the only way the spousal maintenance order can be sustained is through a liquidation of the parties’ capital rather than through any recurrent income provided by the business or assets which he or the family trust control.

  26. He submits that it is neither reasonable nor proper for such a state of affairs to continue.  In these circumstances, he would wish to begin a rational sell off of the parties’ real property, including the former matrimonial home, so that the parties’ debt can be reduced.

  27. It is common ground between the parties that the husband is considerably in arrears in respect of the order for spousal maintenance and that repossession is threatened in respect of the Lexus motor vehicle. 

  28. In addition, Mr Priddle has confirmed through his counsel that there is a significant possibility that the mortgagee of the former matrimonial home will institute proceedings shortly to recover arrears of mortgage payments. In short, it is the husband’s position that his current financial position is parlous. 

  29. The wife’s position is that the parents are independently wealthy people, who have never regarded the business properties as being leased to the parties for commercial purposes. As such, it is her evidence that they have not been proactive about the receipt of rent and an understanding has arisen between the parents and the parties that the Property L property belongs to the parties themselves.

  30. Accordingly, it is the wife’s view that, once these proceedings have been concluded, the various leases which relate to the Property L property will be easily revivified and the petrol station will be relet to either United Petroleum or some other company, which will result in the husband again receiving a regular stream of income.

  31. Similarly, it is her position that the parents had no valid reason to discontinue the lease to [Mr & Ms Priddle] Nominees Pty. Ltd. and have not recently been proactive in pursuing the rent due from it.  In these circumstances, she is suspicious that the husband is winding down the business for ulterior motives, particularly to reduce her level of entitlement from these proceedings.

  32. Mr Priddle has provided a medical report from his general medical practitioner, Dr R.  The report dated 13 May 2009 indicates that the husband is suffering from “symptoms of depression, anxiety and stress”, which have been diagnosed as being major depression since


    1 April 2009. As a result, he has been prescribed anti depressant medication. 

  33. It is Dr R’s opinion that the husband’s working capacity has been effected by what is described as the husband’s “recent domestic upheaval”. In May of this year, the husband described to Dr R “working intermittently three days out of five [and] occasionally working only half days.”

  34. The wife is dubious about this state of affairs.  It is her position that the husband has chosen to work less in a deliberate attempt to make it appear that he cannot earn sufficient income to pay her spousal maintenance.

  35. The wife filed a response to the husband’s application to modify the spousal maintenance order on 20 July 2009. She had earlier commenced other proceedings to enforce payment of spousal maintenance arrears. 

  36. The wife’s Initiating Application filed 29 January 2009 named the parents as respondents. This was because pursuant to section 78 of the Family Law Act 1975 the wife sought a declaration that the parents held the Property L property in trust for the parties in equal shares. 

  37. Up to this stage, the parents have not played an active role in the proceedings.  Mr P filed an affidavit on 9 June 2009.  He deposes that he and his wife have formally demanded payment of arrears of rent and interest arising from the lease of the Property L property. 

  38. It is also Mr P Senior’s position that he and his wife have lent the parties $84,600 in the past, which has not been repaid.  Again, it is the parents’ position that they have formally demanded repayment of this sum, which they assert is secured over stock in trade of the business previously operated by the parties.

  39. In her response, the wife indicates that she seeks the following orders:

    ·A manager be appointed to manage the [omitted] business;

    ·The husband be restrained from dealing with the assets of the business;

    ·The Property L; Property K; and Property S properties be sold;

    ·The proceeds of sale be used to discharge the lease on the Lexus motor vehicle with the balance to be placed in an interest bearing account;

    ·The husband make further disclosure in respect of his financial affairs;

    ·An accountant prepare a forensic report as to the conduct and profitability of the [omitted] business over the last five years and provide an analysis of the husband’s dealings with the business in the period since separation.

  40. In her affidavit filed in support of her response, the wife deposed as to her concern that the [omitted] business appeared to have closed its doors.  During the course of the hearing, conducted on 10 August 2009, the husband confirmed that this was the case.  It is his position that the parents have resumed occupation of the land on which the business previously operated.

  41. The wife continues to be sceptical regarding the bona fides and likely permanence of these various transactions.  However, she acknowledges that it is a pointless exercise to appoint a manager to a business which is not operating and which, ostensibly at least, has no premises.

  42. The wife does however continue to agitate her application for a forensic valuation of the business to be undertaken, both now and historically.  The purpose of the valuation would be to ascertain if the business has reduced in value significantly in the aftermath of the parties’ separation.  If so, at final hearing, she would want the business taken into account at its pre-separation value and the amount lost attributed to the husband as arising as a result of his negligent wastage of it.

  43. The wife has also come to accept that she will be unable to retain the former matrimonial home in any final determination of the parties’ competing applications.  In these circumstances, she agrees with the husband that they should take immediate steps to realise their real property holdings. 

  44. Accordingly, following the hearing on 10 August 2009, the parties were able to agree on a number of interim orders as follows:

    1.The parties do all things and execute all documents to cause:

    a.Property K to be marketed to be sold by Mr H at an asking price of $90,000.00 NOTING that the husband and wife will accept offers above $70,000.00 as they shall agree;

    b.the property at Property L be placed on the market for sale by auction by Ray White, with a reserve of $440,000.00;

    c.the former matrimonial home at Property W be placed on the market for sale by auction by Ray White, with a reserve of $900,000.00 and;

    d.Property S to be offered as a first option to purchase to the other joint tenants Ms L on the basis the husband and wife net $100,000.00 from the transaction NOTING the other joint tenant pay all fees and charges of both parties to the transfer;

    2.     The net proceeds of sale be applied to:

    a.     costs and commissions of sale;

    b.     payment of liabilities secured against the property;

    c.that pending settlement to pay mortgages rates and taxes on the other properties;

    d.into an interest bearing deposit in the husband and wife’s joint names and;

    e.private medical health benefits pending finalisation of proceedings.

    3.After receipt of advice from the second respondents’ accountants as to the value of the business or forty two (42) days whichever is sooner, the parties (if not agreeing to the valuation of the second respondents’ accountant) then appoint a single expert to value the said business.

    4.The plant and equipment of the business be valued, subject to the second respondents’ consent, by Henley Auctions.

    5.The cost of valuation to be undertaken by the single expert in 3 and 4 herein be paid from the monies in 2 (a) herein.

  45. The husband maintains his position that he is incapable of satisfying any aspect of the spousal maintenance order made on 25 March 2009.  He has deposed that he has been referred to a psychiatrist.  He is in the process of applying for social security payments. 

  46. The wife opposes the discharge of the spousal maintenance order.  It is her position that, when the order was made, the husband had the financial capacity to make the payments in question and it is only as a result of his acts and omissions that the business has ceased.  In these circumstances, she contends that it would not be proper for the order to be discharged.

  47. The wife too has applied for social security benefits.  It is her position that her financial circumstances are parlous, particularly given her state of health and her responsibility to support the parties’ two children.

  48. The parents did not appear on the 10th August and so did not take part in the hearing.  When the parties’ respective applications were fixed for hearing, the parents were represented by their solicitor, who indicated that his clients wished for the parties to find a pragmatic and holistic solution to the various disputes in this matter, which would keep legal costs to a minimum.

  49. The current proceedings are interim in nature.  As such, the hearing proceeded in a shortened form, being based on a consideration of the respective affidavits of evidence, without the opportunity for cross examination.

  50. As is clear from this introductory summary, there are many factual issues in dispute between them, the most significant of which is the financial viability of the parties’ [omitted] business.  Given the nature of the interim hearing, I am not in a position to resolve these factual disputes, at this stage.

  51. The resolution of these issues must await the final hearing.  In addition, at the final hearing stage, the court is likely to have access to an independent and expert assessment of the financial circumstances of the various entities involved in this case, particularly whether the business has been run down in the period between separation and trial.

The legal principles applicable

  1. Section 83 of the Family Law Act 1975 deals with the discharge, potential suspension or variation of a spousal maintenance order.

  2. The court may discharge such an order if there is “any just cause for so doing” [section 83(1)(c)]. 

  3. In addition, a spousal maintenance order may be suspended, either wholly or in part, until a specified time or the occurrence of some specified event [section 83(1)(d)].

  4. The Family Law Act does not contain a definition of “just cause”.  However, it is clear that the expression must be interpreted within the context of the provisions of the Act as a whole, particularly the provisions of Part VIII, which deals with property, spousal maintenance and maintenance agreements. 

  5. In Lutzke & Lutzke[2], Lindenmayer J said as follows:

    “… the Act is silent as to what may constitute “just cause” for the discharge of an order.  In my opinion, however, the words “just cause” are not used in any broad general sense, nor are they intended to import any abstract notions of justice, “palm tree” or otherwise into the determination of applications for discharge. 

    In my opinion those words must be interpreted in the context of the Act as a whole, and in particular with regard to the other specific provisions of the Act which relate to maintenance.  Thus a “cause” for the discharge of an existing maintenance order will be a “just cause” only if, having regard to the other provisions of the Act, particularly those relating to maintenance, it can be said that it is “right” or “proper” that the order should be discharged.” 

    [2]  See Lutzke & Lutzke (1979) FLC 90-714 at 78,832

  6. In this regard section 83(7) is relevant. In both the discharge, variation and suspension of a maintenance order, the court is directed to have regard to the provisions of section 72 and 75 of the Act, which pertain to the right of a spouse to maintenance and the matters to be taken into account in making such an order.

  7. Section 72 deals with the right of a spouse to maintenance and reads as follows:

    “   (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 who has not 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;

    having regard to any relevant matter referred to in subsection 75(2).”

  8. Given the factual basis for this case, the relevant matters referred to in section 75(2) are likely to be the following:

    a)the age and state of health of each of the parties;

    b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;

    c)the care of children of the marriage under the age of eighteen years;

    g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable;

    k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;

    na)        child support considerations.

  9. Pursuant to section 74, the court is directed to make whatever order, relevant to the maintenance of a party to a marriage, which it considers “proper”

  10. The Full Court of the Family Court in Bevan & Bevan[3] determined that the approach to be taken in respect of applications for spousal maintenance involved a four step process as follows:

    a)a threshold finding under s.72;

    b)consideration of s.74 and s.75(2);

    c)no fettering principle that a pre-separation standard of living must automatically be awarded where the respondent’s means permit;

    d)discretion exercised in accordance with the provisions of s.74 with “reasonableness in the circumstances” as the guiding principle.

    [3]  Bevan & Bevan (1995) FLC 92-600 at 81,981-2

  11. Accordingly, in determining whether to discharge the order for spousal maintenance, I must be satisfied that it is proper to do so.  In considering this issue, I must make some assessment of the financial circumstances of both parties, particularly those of the husband, given it is only recently that the court conducted an inquiry into the level of his income and commitments.

  12. Pursuant to section 83(2) before varying an order for spousal maintenance, either in terms of increasing or reducing the amount previously ordered to be paid, the court must be satisfied as to one of the following:

    a)there has been a change of circumstances for one of the parties concerned;

    b)there has been a change of the cost of living;

    c)in the case of a consent order, that the amount ordered to be paid is not proper or adequate; or

    d)material facts were withheld from the court.

Conclusions

  1. In this case there has clearly been a change of circumstances for the husband.  In my view, it can only be characterised as a major change of his financial circumstances.  The business which he operated for the vast majority of the marriage and from which the family derived its income has closed its doors.

  2. Although the wife has had some past involvement with the operation of the [omitted] business – she did the books – clearly Mr Priddle was the guiding genius of it and as such his personal involvement is required to keep it going.  He has the necessary technical skills required and has attended to the management of the business and the supervision of its staff since it began.  The court cannot compel Mr Priddle to resume the operation of the business.

  3. There exists much controversy, between the parties, regarding the bona fides of the parents resuming occupation of the Property L property.  It is clear that the parents are the sole legal proprietors of the property concerned.  It also seems apparent that the applicable lease has expired. As such, I am not in position to look behind this transaction at this stage.  I do not think it can be said that the parents were not entitled to take the actions which they assert they have done.

  4. At this interim stage, I am not in position to determine whether there is any substance to the wife’s contention that the parents have previously gifted the property to the parties or that, as a result of improvements made to it by the parties, they are to be regarded as having a significant equitable interest in it.

  5. Accordingly, at least on a prima facie basis, the husband does not have access to premises from which to conduct the business.  In addition, it seems clear that one of the family’s other significant streams of income – the rent from the sublease of the petrol station – has also been terminated.

  6. The wife concedes that, in the absence of premises and with the closure of the business, nothing will be gained by the appointment of a manager.  Accordingly she accepts that the business is not generating any income.  In addition, at this stage, she is unable to point to any alternative sources of income for the husband.

  7. The wife’s position is that the parents’ occupation of the Property L property was not at arm’s length and was engineered by the husband for tactical reasons related to these proceedings.  In support of her contention, she points to the fact that the plant and equipment of the business remain in situ at the property.  If this had been an orderly and planned closure one would expect some arrangements would have been made to sell these items or transfer them to other premises. 

  8. The wife is also aggrieved that the husband took the decision to close the business unilaterally without any prior reference to her, a co-director of the company which operated the business.  This factor also heightens her suspicions and causes her to doubt the husband’s assertions regarding the down turn in trade.

  9. I share the wife’s concerns.  It is also difficult to ascertain, at this juncture, what will ultimately happen to the business’ plant and equipment.  It is unclear whether the bill of sale held by the parents applies to these items of property.  Accordingly it seems likely that the husband retains access to the tools of his trade.

  10. The husband asserts that his state of health currently precludes him from working.  He has supplied medical evidence in support of this contention.  The wife is dubious about this evidence but is not in a position to refute it.  At this stage of proceedings I am not in a position to resolve this issue regarding the husband’s capacity to earn an income, which is likely to be central if the matter proceeds to final hearing.

  11. However, what is clear is that the husband currently has no discernible stream of income available to him from which to satisfy the spousal maintenance order. This was not the position when the order was made in March of this year. Accordingly, I am satisfied that the prerequisite condition provided by section 83(2)(a)(ii) has been satisfied, in that the financial circumstances of Mr Priddle have changed.

  12. The more difficult aspect of the case is whether there is just cause to discharge the order in question.  As I take it, the wife’s case hinges on this consideration.  In essence, it is her position that the husband, quite possibly whilst in cahoots with the parents, has engineered the current financial crisis which he and the wife face, for his own ulterior purposes.  In such circumstances, she contends, it would be neither just nor proper for the order to be discharged.

  13. At this stage of proceedings, I am unable to ascertain the bona fides of the husband’s conduct in respect of the business.  Again that is an inquiry which must stand in waiting until the final hearing.  In my view a level of suspicion about the conduct and motivation of a payer of maintenance, even if is a high level of suspicion, does not necessarily render it improper to discharge a maintenance order, particularly where there is tangible evidence to indicate an actual and significant change of circumstances for the payer concerned.

  14. I do not think I need to repeat verbatim the earlier findings I made regarding the wife’s current financial circumstances as they pertain to section 72 of the Act. In my view these circumstances remain current.

  15. In summary, given her significant health constraints, the wife is unable to maintain herself financially.  Given the length of the marriage between the parties and the fact that during it the wife’s health issues emerged, it remains my view that it would be proper for the husband to maintain the wife, if he is able to, as he is her only likely source of financial support and given her obvious level of disability her needs are significant.

  16. However, section 72 also imports a requirement for the court to only make a spousal maintenance order if it is reasonable to do so. This necessitates the court to conduct an examination of the financial capacity of any proposed payer of such maintenance. A payer is only required to pay maintenance if he is reasonably able to do so.

  17. At the present time, I am satisfied that the husband has no apparent source of income.  In addition, the parties have agreed upon a process of liquidation of their most significant assets, in terms of value.  Accordingly, it cannot be said that the husband should sell or otherwise utilise some piece of property, in his sole control, for the purpose of meeting the order.

  18. Although there is considerable controversy between the parties regarding how it came about, it is agreed between them that their business is currently moribund and cannot easily be revivified.  It may ultimately prove to be the case that some level of criticism will attach to the husband in respect of why the business ultimately closed its doors and this criticism may have ramifications regarding the division of the parties’ remaining assets between them.

  19. Accordingly, there exists some scope for rectification of the current circumstances, so far as the wife is concerned.  Having considered all of the various matters, I have come to the conclusion that it would be proper for me to discharge the order which was made on 25 March 2009 given that the husband has no current capacity to meet the order.

  20. I have closely considered whether I should suspend the operation of the order until such time as any or all of the parties’ real property is sold.  Certainly it would appear appropriate that some of the proceeds be allocated towards financial support of the wife, given that she has no capacity herself to derive an income.

  21. I have decided against this course at this stage, primarily because it seems to me that an on-going stream of maintenance should be fundamentally provided from the recurrent income of a spouse rather than through the provision of capital.  Accordingly it seems appropriate to me that the division of the proceeds of sale of the parties’ various real properties should be determined according to the mechanisms provided by section 79(4).

  22. However the wife’s financial circumstances remain parlous.  I accept that she needs an appropriately modified motor vehicle for herself.  If and when the former matrimonial home is sold, she will need accommodation for herself and the children. 

  23. In these circumstances, it would appear appropriate that the wife should be able to relist the matter at short notice in the event she wishes to make an application for an order for urgent spousal maintenance, either in a lump sum or in such other form as she deems necessary, from any capital sums liberated from the sale of any piece of property currently belonging to the parties.

  24. Given the parties’ mutual financial difficulties, it is appropriate that their final applications be allocated a trial date as soon as practicable.  I will list the matter for trial directions prior to that date to ascertain what has occurred in respect of the process of sale of the parties’ various real properties.

  25. For all these reasons, the orders of the court will be as set out at the commencement of these reasons for judgement.

I certify that the preceding eighty-eight (88) paragraphs are a true copy of the reasons for judgment of Brown FM

Associate:  J Williams

Date:         19 August 2009


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Priddle and Priddle [2009] FMCAfam 258