R and A
[2003] FMCAfam 252
•2 July 2003
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| R & A | [2003] FMCAfam 252 |
| FAMILY LAW – Property – leave to proceed out of time – prima facie case – hardship. Family Law Act 1975, ss.44(3), 79 Jacenko & Jacenko (1996) FLC 91-776 |
| Applicant: | S R R |
| Respondent: | P L A |
| File No: | DNM 99 of 2003 |
| Delivered on: | 2 July 2003 |
| Delivered at: | Darwin |
| Hearing date: | 27 June 2003 |
| Judgment of: | Brown FM |
REPRESENTATION
| Counsel for the Applicant: | Ms Davis |
| Solicitors for the Applicant: | Davis Norman |
| Counsel for the Respondent: | Ms Terry |
| Solicitors for the Respondent: | Janet Terry |
ORDERS
That pursuant to s.44(3) of the Family Law Act the husband be granted leave to proceed with his application filed 24 February, 2003.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT DARWIN |
DNM 99 of 2003
| S R R |
Applicant
And
| P L A |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an application brought by S R R “the husband” pursuant to section 44(3) of the Family Law Act 1975 for leave to bring proceedings pursuant to section 79 of the Family Law Act 1975. The respondent to the application is P L A “the wife”. She opposes that course.
The husband relies on an affidavit sworn by him and filed on the 10th of June 2003. The wife relies on an affidavit sworn by her and filed on the 30th of May 2003.
The circumstances giving rise to the application are somewhat unusual. The husband commenced proceedings in this Court on the 24th of February 2003. At that time he sought orders that would result in the transfer to him of the wife’s interest in the former matrimonial home situated at 2/695 R Road, D R and that he indemnify her in respect of a mortgage to ATSIC on the property. He further sought orders that the parties otherwise retain all other assets that they currently possessed. This application was given a return date of the 1st of April 2003.
On that day Ms Davis appeared for the husband and Ms Hepburn, a solicitor employed by the North Australian Aboriginal Legal Aid Service, appeared for the wife. At that time the wife had not filed any material in response. However, leave was given to Ms Hepburn to appear.
It seems that on the 1st of April 2003, pragmatic considerations took precedence and counsel for both parties submitted that, notwithstanding the absence of answering material on behalf of the wife, given that the pool of matrimonial assets was small, it was appropriate for the matter to be referred to a conciliation conference with a Deputy Registrar of the Court. Accordingly, the matter was referred to a conciliation conference on the 16th of May 2003. The matter was further listed before the Court on the 30th of May 2003.
A conciliation conference did take place on the 16th of May 2003. Both parties attended with their solicitors. The report of the relevant Deputy Registrar indicates that the parties attended but no agreement was reached. A written note on the conciliation conference report indicates as follows:
“Residence of the child now an issue. Very small pool – about $50,000.00. Property part of case not resolvable until residence issue is agreed.”
Accordingly, it is clear that up to that stage, the wife had not raised any issues regarding the entitlement of the husband to bring these proceedings and indeed had intimated that she proposed to bring proceedings of her own in respect of the parties’ child.
As a result, on the 30th of May 2003, the wife filed a response to the husband’s application in which she sought the following orders:
(1)That the child of the marriage N P A born 1 November 1989 reside with the mother.
(2)That each party have sole responsibility for decisions concerning the short term care, welfare and development of the child while the child is with them.
(3)That the mother jointly with the father have responsibility for decisions concerning the long term care, welfare and development of the child.
(4)That the father have contact with the child as agreed between the parties.
(5)That the father’s application for orders concerning property, having been instituted without leave first having been obtained pursuant to section 44(3) of the Family Law Act, be dismissed.
As a result of this response, on the 3rd of June 2003, the following order was made:
1. Upon the applicant husband filing an application for leave to proceed out of time within 7 days of today's date, the matter is fixed for hearing of the application at 09.00am on 27 June 2003.
In response to this order, the husband filed his application seeking leave to proceed on 10 June, 2003. The wife has not filed another response to this application, but relies on her response filed 30 May, 2003.
Background
The parties were married in Darwin on the 15th of July, 1989. They separated on the 31st of January 1999. The marriage between them was dissolved on the 16th of August 2000. Accordingly, the husband’s application is about six months out of time. There are two children of the marriage, W J R who was born on the 9th of January 1984 and N P R; who was born on the 1st of November 1989. Accordingly, W is now over the age of 18 years. N has been living with the husband since the parties separated.
The parties’ former matrimonial home situated at 2/695 R Road, D R was purchased in 1989. It is registered in the sole name of the wife. She values the property at approximately $100,000.00 and currently there is an amount of $53,000.00 owing to ATSIC in respect of a first mortgage registered on the property. Since separation, the husband and N have lived in this property.
In her affidavit, the wife deposes that the former matrimonial home was purchased for the sum of $80,000.00. She provided a deposit of $2,500.00 and the husband provided a similar amount. The balance of the purchase price was provided by ATSIC. ATSIC were apparently not willing to loan monies to the husband, due to his poor credit rating. For that reason that the property was registered in the sole name of the wife.
Neither party deposes specifically as to how the necessary recurrent mortgage payments were paid from June of 1989 onwards. However, the wife concedes that she was engaged in home duties and providing care for the children, whilst the husband commenced a retail outlet selling plants.
The parties separated on the 31st of January 1999, when the wife left the former matrimonial home. She initially moved in with her son Wayne. N remained living with her father at the R Road property. Initially, the wife hoped to have a shared care arrangement in respect of N with her and the husband moving in and out of the R Road property on a weekly basis, but this did not eventuate.
It is the wife’s position that from separation until August 2002, she made all the necessary payments on the mortgage. It is the husband’s position that the parties had a loose agreement that N would continue to live with him and in lieu of child support payments from the wife, she (the wife) would continue to pay the mortgage.
The wife deposes that during 2000 she and the applicant had some discussions about finalising their property arrangements. The wife deposes as follows in her affidavit:
“After our divorce was finalised in 2000, I repeatedly told the applicant that he needed to put in the paperwork to receive his half share of the block. He would tell me that he would contact his solicitor Robyn Davis and get her to prepare the paperwork, but nothing ever arrived for my signature.
The applicant and I had agreed during 2000 that we would sell the property and divide the net proceeds equally between us. During 2002 I told the respondent that I wanted $50,000 and that he could then have the block and take over the block subject to the ATSIC loan.
The applicant agreed to may proposal and Bernice Faulkner and myself met with him at an agreed location so that I could sign papers. However when we arrived at the meeting the applicant only had a blank form.”[1]
[1] See wife’s affidavit filed 30 May 2003 paragraphs 16 to 18
The husband also deposes that in the past the parties had discussions on how they would finalise property arrangements between themselves. It is also the wife’s position that N has now indicated that she wishes to live with her mother. For that reason she has commenced residence proceedings in respect of N. Regardless of the outcome of the present application, it seems inevitable that there will be on going proceedings between the parties in respect of her care.
Ultimately, it is the husband’s position that he wishes to acquire the property from the wife. He deposes that he has the ability to re-finance the mortgage on the property. Although, in a technical sense he has no legal interest in the property, it is his position that he has made a substantial contribution towards the equity in the property in addition to having made substantial indirect contributions, as a parent and home-maker. He submits that the wife will not be prejudiced by him being able to proceed with this litigation and in support of his submission points to the fact that the wife has always conceded that he has an interest in the property in earlier negotiations that have occurred between the parties.
It is the wife’s position that to allow the husband’s application will inevitably cause her hardship, in the sense that there will be a possibility that she will potentially lose a part of the sole interest that she currently has in the former matrimonial home. This is obviously true. However, the wife does not assert that the husband has no chance of success in his application for some form of property settlement in respect of the R Road property. It is apparent that throughout 2000, she was engaged in negotiations in one form or other, which recognised the existence in favour of the husband of an interest in the property that could be established by reference to section 79 of the Family Law Act 1975.
The law applicable to such applications
Section 44(3) provides where a decree nisi of dissolution of marriage has become absolute, proceedings for settlement of property and spousal maintenance, apart from some specifically named proceedings, shall not be instituted except by leave of the Court after the expiration of 12 months after the decree becomes final.
The requirements for leave are set out in section 44(4), which provides that the Court shall not grant leave unless it is satisfied that hardship would be caused to a party to the relevant marriage or a child if leave were not granted.
In Jacenko & Jacenko[2] Nygh, J. referred to the relevant principles applicable to an application pursuant to section 44(3) and said as follows:
“The applicant must establish three principal matters: first, a reasonable prima facie case for relief, had she instituted proceedings in time; secondly, that denial of the wife’s claim would cause her hardship; and thirdly, an adequate explanation as to her delay.
That third requirement must now be read, subject to the decisions of the Full Court in Althaus and Althaus (1982) FLC 91-233; (1979) 8 Fam. L.R. 169 and Howard and Howard (1982) FLC 91-234; (1979) 8 Fam. L.R. 178 which indicate that in appropriate cases the degree of hardship to be suffered by the applicant may well outweigh an inadequate explanation of delay.
If those three elements are satisfied, the Court should further, in determining whether to exercise its discretion to grant relief, consider the question of prejudice which the respondent would suffer by reason of the delay in bringing the application.”
[2] (1996) FLC 91-776 at page 75,644
To turn to each of those matters in respect of the evidence in this case. I am satisfied that the husband has established a prima facie case. On the wife’s case, she concedes that he contributed some of the money required for the initial deposit. The husband also asserts that he made financial contributions during the marriage and other contributions as a parent both before and after the parties separated. It is conceded that N has lived with the husband for a lengthy period of time since the parties separated. In Jacenko, the Full Court said as follows:
“The general principle is that on the issue of the establishment of a prima facie case the Court proceeds on the basis that the evidence of the applicant, unless it is inherently unbelievable or contradictory, should be accepted, and the Court should therefore decide whether or not on that basis a prima facie case has been made out. If leave is granted, then it is for the Court conducting the ultimate hearing to determine whether the prima facie case can be established.”
In Hall and Hall [3]the Full Court of the Family Court reviewed a number of earlier cases which had addressed the issue of the required strength of the prima facie case in s.44(3) applications. The Full Court said:
“These varying phrases may tend to suggest different shades of meaning whereas in reality they are directed to the same fundamental enquiry which basically is in the context whether on the applicant’s material he or she has a reasonable claim to be heard by the Court.”
[3] See Hall, K A and Hall, J C (1979) FLC 09-679
Although the pool of assets in this particular case is small, given the issues regarding the residence of N and the parties’ respective contributions towards the equitity in the R road property, I am of the view that the husband has a reasonable case to put before the Court that he has some interest in the property.
The husband bears the onus of establishing that to refuse him leave to proceed with his property application would cause him hardship. In his affidavit evidence, the husband does not specifically indicate what hardship would be occasioned to him. However, it can be easily inferred that if he is not able to bring his case, the wife will be able to remove him from the former matrimonial home, which he has occupied since the parties separated. He will be deprived of the opportunity of establishing any interest in the property. In my view, given these obvious factors, he is able to establish that he would suffer hardship, if he is not given leave to proceed. It is not necessary for the husband to establish that he would be left in dire circumstances if not granted leave to proceed.
In Whitford and Whitford[4], the Full Court of the Family Court said as follows:
“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 may be his or her loss of a prospective entitlement to have financial and property relations of the parties adjusted or resolved, may constitute hardship. To deprive a party of a right to institute proceedings is not per se a hardship but to deprive the wife of a right to action in the present circumstances, that is where she has a substantial claim, is a substantial detriment.”
[4] (1979) FLC 90-612
Once again, the onus to provide an explanation for the delay in instituting proceedings lies on the husband. He has not provided any specific reason for the delay in his affidavit material. However, it would appear to be his position that he believed that as the parties were negotiating with one another throughout much of 2000 and the wife continued to pay the necessary mortgage payments up until at least August of 2002, there was no necessity to commence proceedings. He does not depose specifically as to his knowledge of the applicable legislation; whether or not he had access to formal legal advice in respect of the matter; or any other reason or provide any other reason for the delay.
However, I can understand, given the comparatively small equity the parties have in the subject property; the arrangement that seems to have come into place in respect of N; and the wife’s decision to work interstate, at least briefly; that these would be factors that would indicate to the husband that there was no need to finalise arrangements between him and the wife. After all, he continued to live in the property with N and the wife continued to make the necessary mortgage payments. From his point of view, there was no imperative to finalise matters. The wife also concedes that there was some agreement reached between them in 2000 regarding the property or at least negotiations were on-going.
Although the applicant’s explanation for the delay is not compelling and is quite rightly criticised by counsel for the wife for lacking detail, I am satisfied that the degree of hardship that he would suffer outweighs the inadequacies of his explanation for the delay. In any event, the delay has been fairly short and was prefaced by negotiations between the parties during 2000 and later regarding the property and also the conciliation conference, which the wife attended with her legal adviser. It cannot be said that these proceedings have come out of the blue so far as she is concerned.
Finally, it is necessary for me to consider the prejudice that would be occasioned to the respondent wife if the application is granted. She herself has instituted proceedings in this Court in respect of arrangements for N. She seeks the residence of N, although whether at the former matrimonial home or at some other location is unclear. It would seem to me that the issue of this property and the disposition of the parties’ interests in it will have some implications in respect of future parenting arrangements for N. The two matters are tied together. The wife will be necessarily involved in proceedings in this Court in that regard. As I say, I do not think that the wife can establish that the husband’s application for property orders comes as a shock to her. The parties have been in discussion with one another about the property and its disposition since after they separated. It is also clear that the wife’s initial legal advice did not touch upon the issue of an extension of time, as she was apparently amenable to discussing possible settlement in the conciliation conference. In all these circumstances, I do not think it can be said that the wife will suffer undue prejudice as a result of the husband being allowed to bring his application, and by prejudice I mean, difficulty in presenting her case because of the delay, rather than the obvious hardship to be occasioned to her, by her potentially losing a part of her interest in the former matrimonial home by reason of the husband’s claim. The husband’s claim is not greatly out of time. The wife is not able to point to any witnesses who will not be available by reason of the delay. She is already committed to proceedings in this Court in respect of arrangements for N in any event.
As a result of all these matters, I have come to the view that it is appropriate to grant the husband’s application. The order of the Court will be as set out at the commencement of these reasons for judgment.
I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of Brown FM
Deputy Associate: Cathy White
Date: 2 July 2003
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