RAVIN & RAVIN

[2013] FamCA 395

FAMILY COURT OF AUSTRALIA

RAVIN & RAVIN [2013] FamCA 395

FAMILY LAW – PROPERTY – Undefended

Family Law Act 1975 (Cth)

APPLICANT: Ms R Ravin

RESPONDENT: Mr C Ravin

FILE NUMBER: MLC 6560 of 2012

DATE DELIVERED: 30 April 2013

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: 30 April 2013

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Chislett

SOLICITOR FOR THE APPLICANT: Zindilis Barristers & Solicitors

THE RESPONDENT: No appearance

Orders

1. Pursuant to s 78 of the Family Law Act 1975 (Cth), the Court declares that Mr C Ravin, the husband, has no legal or equitable interest in the property at … B Street, Suburb D in the State of Victoria being the land described in Certificate of Title Volume … Folio … .

2. That subject to the wife doing all acts and things necessary to obtain finance to secure the payment by 4.00pm on 17 May 2013 of the following:

   (a)    the joint mortgage to the National Australia Bank of $50,578.01;

   (b)    the National Australia Bank personal loan in the name of the wife for $28,147.27;

   (c)    the council rates of $10,406.72;

   (d)    the Victoria Legal Aid caveat debt of $3905.57; and

   (e)    City West water debt of $3200,

   (evidence of which shall be provided to the husband at the same time as he is provided with the transfer of land document), the husband and wife sign a transfer of land in respect of their interests in the property referred to in paragraph 1 of these orders to the wife herself and Mr S Ravin and Ms F Ravin as tenants in common in equal shares.

3. Pursuant to s 106A of the Family Law Act 1975 (Cth), if the husband fails to sign the transfer referred to in paragraph 2 of these orders by 4.00pm on 17 May 2013, then upon production to a Registrar of the Family Court of Australia of an affidavit signed by the solicitor for the wife confirming that the husband has been provided with the evidence of the wife’s ability and commitment to pay the sums referred to in paragraph 2 along with a demand for him to execute the said transfer of land and he having failed to comply by the due date, a registrar of the Family Court of Australia is authorised to sign such transfer as described in paragraph 2 of these orders in the name of the husband.

4. That by 4.00pm on 24 May 2013, the husband vacate the real property at … B Street, Suburb D and remove all goods and chattels therefrom save that the husband is restrained by injunction from removing the refrigerator, dishwasher, sewing machine, Mr S Ravin’s bed and paintings, the glass table in Ms F Ravin’s room, the gas barbeque set and the washing machine.

5. That on and from 4.00pm on 24 May 2013, the husband, including by his servants and agents, is restrained by injunction from:

   (a)    entering or remaining within 500 metres of … B Street, Suburb D; and

   (b)    otherwise removing any chattels, fixtures and fittings from the said property.

6. That unless otherwise specified in these orders and save for the purposes of enforcing any part of them, each party retain to the exclusion of the other, all other property (including superannuation) in the possession of that party.

7. That any joint tenancy of the parties in any real or personal property is hereby expressly severed.

8. That subject to compliance by the wife with her obligations as set out in paragraph 2 of these orders, the wife be responsible for and indemnify the husband against any liability in relation to the liabilities referred to in that paragraph.

9. That all other applications are otherwise dismissed.

10. That a copy of these orders be served by the wife upon the husband by ordinary mail addressed to him at … B Street, Suburb D.

11. That all parties have access to a copy of the reasons for judgment this day.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Ravin & Ravin has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 6560 of 2012

Ms R Ravin

Applicant

And

Mr C Ravin

Respondent

REASONS FOR JUDGMENT

1. This is an application by Ms R Ravin who, in these reasons, I shall refer to as “the wife”, seeking orders for the division of property against her husband, Mr C Ravin (“the husband”).  Notwithstanding the parties have been separated for a long time, I propose to use the reference “husband” and “wife”.  It is much easier to deal with them that way. 

2. This has been an undefended property proceeding but not without its complexities. 

3. The proceedings began by the wife filing an application seeking orders on 20 July 2012.  The matter came on for hearing on the first occasion on 25 September 2012, before a registrar.  No one appeared on behalf of the husband.  Since that time, the husband has not only not filed any documents but has not appeared in any hearing nor, I am told, has he had any correspondence with the practitioner for the wife.  This morning, just after 10 o’clock, the husband was called and again, there was no appearance. 

4. In September 2009, the Registrar adjourned the matter to 23 October.  On 23 October 2012, the matter came on before another registrar and again, there was no appearance of the husband.

5. The registrar has noted on the court file that she was satisfied that the husband was served with all of the relevant documents.  The matter was then adjourned again, to 11 December 2012 and again, the husband was called but did not appear.  Further orders were made on that occasion, adjourning the matter to a directions list on 6 February 2013 and a specific order was made that both parties appear and or be represented on that date.  The husband was ordered to file a response and supporting material by 28 January 2013 and I note that, according to the court file, he has not complied.

6. The wife was ordered, on that occasion, to serve a copy of the orders upon the husband by post to … B Street, Suburb D.  I shall refer to that property as “the home”.  When the case came back before the court on 6 February, there was again no appearance and the registrar’s bench sheet shows that the Court was satisfied as to service and the matter was otherwise adjourned into the judicial duty list on the presumption that the case was going to proceed on an undefended basis. 

7. The matter came before me on 7 March 2013 and again, the husband was called and there was no appearance and as I have indicated, he had not filed any material.

8. On 7 March, because I was not comfortable with the material relied upon by the wife, the matter was adjourned until today as a one day final hearing and I gave the wife leave to proceed on an undefended basis.  Again, service orders were made and I have an affidavit today by the solicitor for the wife, indicating that service of documents has been effected and there is still no suggestion that the husband has shown any interest.  There is only so far that the court can go to assist people who do not participate in proceedings and effectively not only ignore court orders but also thumb their nose at the court.

9. It is trite to say that the rules of the court provide, in financial matters, for parties to be transparent in relation to their financial positions and to the extent that a party fails to fulfil that obligation, the court is entitled to take a robust approach and effectively presume that the party who is ignoring the court and failing to comply with obligations, has no real interest in the outcome of the proceedings.  On the basis of that, I am satisfied that the husband is aware of the proceedings, has been accorded ample opportunity to participate and has chosen not to do so.  Accordingly, I give the wife leave to proceed on an undefended basis.

10. The background of this case is relatively simple.  The parties were married in Europe in 1987 and came to Australia in 1988.  At that stage, the husband had already been a resident in Australia for five years.  The relationship saw two children, a son who is now 25 years of age and a daughter who is 24 years of age.  Although there was some suggestion in the proceedings that they were to be joined as parties, for reasons which will become apparent, they were not.  They are, I am told, present in court today but they have not participated in the proceedings.

11. In 1988, when the parties arrived as a newly married couple, they moved into a compatriot’s home in what became their home.  They continued to live in that property until the death of the home owner in 2002.  Annexed to the wife’s affidavit, in support of the orders she seeks, is a copy of what she says was the owner’s last will.  The evidence is somewhat unsatisfactory because although the wife asserts that the will was the last will, there is no indication of a grant of probate having been made and that has some impact because of the nature of the orders being sought.

12. Having said that, the husband has not participated in any of the proceedings and having been satisfied that he has been served with the documents, I can be comforted by the fact that he does not dispute what the wife says.  Where my disquiet lies is in relation to people such as the National Australia Bank and Victoria Legal Aid, as well as local municipal authorities, who have a vested interest in being paid.  They have not been put on notice that the orders being proposed today may have some impact upon their entitlements.  I propose, therefore, for reasons which will become apparent, to make orders that effectively require their protection, not so much by notice and natural justice but by effectively being repaid.

13. The wife deposed to the fact that the relationship came to an end after a period where she was separated under the one roof.  She moved out of the property in 2006 with the children and obtained rental accommodation.  It transpires that she has lived in that rental accommodation with the children since the separation and the husband has remained the sole occupant of the home. 

14. The dilemma is that the will of the deceased transferred the interest that he had in the home to the wife and the two children and the description would appear to be as tenants in common, in equal shares.

15. The wife deposed to the fact that the husband had been specifically excluded by the deceased on the basis that the deceased saw him as a drunk and violent man.  There is some support for that view, because there was a violent incident between the husband and the wife, culminating in the husband being sentenced by the criminal courts of this state. 

16. What is bizarre about this case is that notwithstanding the clear intention of the deceased, the home was registered with the Registrar of Titles in Victoria in the names of the husband and wife as joint proprietors.

17. The explanations as to how that occurred are not only in conflict but quite unsatisfactory but the end result seems to me to be that it does not matter.  The wife’s version was that the solicitor who conducted the conveyance to get the home from the deceased’s name into that of the husband and wife did something quite improper;  effectively, the solicitor was accused of acting without instructions.  A more recent affidavit by the wife suggests that she agreed with the course of action that was undertaken on the basis that she was threatened as a result of the behaviour of the husband and feared for her life.

18. Having regard to the evidence about his conviction for violence, I am comforted by the fact that that would probably mean that what the wife says in the more recent affidavit was correct.  On any view, however, at the time that all that occurred, the two children of the marriage were either just adults or even children.  That being the case, I am not entirely sure how their equitable interests were simply ignored.  There is no evidence before me as to the exact steps that were taken but on any view, the two children had a one third interest each in this property.

19. Both of the children have filed affidavits in these proceedings, indicating that they wished their mother to have the title to the home but they were going to make an arrangement with her.  Subsequent to some discussions this morning, the wife has amended her application to seek orders that protect the children’s interests.  That conversation took place in the presence of the two children sitting throughout these proceedings in the courtroom. 

20. Counsel for the wife said that there is now no suggestion of any need for them to be joined as parties and they have not been heard to demur.

21. Needless to say, the home has been in the names of the husband and the wife since some time after the death of the deceased. What is now proposed by the wife is that the court make a declaration under s 78 of the Family Law Act 1975 (Cth) (“the Act”) to the effect that the husband has no interest in the home. Then, she seeks an order that subject to the payment out of the creditors mentioned earlier by 17 May, she and the husband transfer to the wife and the two children, the whole of the home, as tenants in common in equal shares.

22. To give effect to that order, on the basis of the lack of cooperation of the husband to date, an order is sought under s 106A of the Act that the home be transferred by the Registrar in the name of the husband in the event that it is established by affidavit that the husband has failed to comply. That would rectify the title position, putting the wife and the two children as the legal and equitable owners of the home. That creates a dilemma for the creditors who have acted, presumably in good faith, on the basis of the face of the title.

23. Clearly, the mortgagee, National Australia Bank, is the most affected because they have presumably taken security over 100 per cent of the home.  The bank would now be losing two thirds of that security, which means that the equity that they have not only is much less but they would also have to deal with two other registered proprietors if they were to try and enforce their security.  That problem seems to me to be overcome on the basis of an assurance by counsel for the wife that his instructions are that the wife has made inquiries and the bank is prepared to effectively refinance the whole arrangement. 

24. The problem is that the husband is remaining in the property.  On the basis of the evidence before me which, as I have indicated, is unchallenged, there is no reason for the husband to remain and for that reason, I propose to make an order that he vacate it by 24 May. 

25. Giving the husband less than a month from today is not unreasonable, having regard to the fact that it has always been the wife’s case that she wanted vacant possession and he has known that.  If he has not vacated the home then he has had ample time and I have little, if any sympathy for him.  There are chattels in the home, claimed by one of the children according to the wife and as the husband has been aware of that and not attended, I see no reason why an injunction should not be made, requiring him to leave those behind. 

26. The wife deposed to the fact that, to renovate the home, the parties borrowed $50,000 but rather than the money being used for that purpose, the husband went overseas to Europe, where he used the money to effectively sort out some family issues.  The wife’s best evidence, which she says came from the husband, was that he obtained an interest in property in Europe.  Again, the husband has had an opportunity to respond to that and has not done so, so I accept the unchallenged evidence of the wife.  The house still had to be renovated and as a consequence, the wife went back to the National Australia Bank, this time presumably with a concurrence of the husband because his name was on the mortgage and borrowed the $50,000 or thereabouts and over the ensuing period of time, that mortgage was slowly but surely reduced to about 30-odd thousand dollars.  Since March 2009, the husband has not made any payments.

27. There is no evidence before me that the mortgagee bank is concerned about the debt because they have allowed it to increase without enforcing their security.  The wife was prosecuted under Commonwealth Law for fraud on Centrelink.  In September 2007, which I note was approximately a year after separation, she pleaded guilty to offences and was ordered to pay $5000 to a charity, as well as some legal fees but she also had to repay Centrelink.

28. She then took out a personal loan to make the repayment and although she said in her affidavit that she thought that the husband, as the beneficiary of the largess of the Commonwealth of Australia, should have contributed to the debt, he failed to do so.  That overlooks the fact that she was the one who was charged and indeed, pleaded guilty.  On the best understanding I have, it seems that she was working full time and obtained Centrelink benefits inappropriately.  Her evidence was unsatisfactory because she said the payments from Centrelink were incorrect and invalid but it is hard to understand how anyone could make that mistake.

29. Be that as it may, what it points to is two things.  The first is that the husband was not working during the marriage and that seems to be consistent with the wife’s evidence about his behaviour all of the way through the marriage.  The second thing is that she now is encumbered with a debt to the National Australia Bank which just exacerbates the problem. 

30. The evidence about what assets the parties have between them is also unsatisfactory but I have accepted that the wife relies upon the hearsay evidence from estate agents by way of an appraisal.  Unsatisfactory as that may be, I accept that there is no other evidence that I can rely upon and having regard to the amount involved in this case, I do not propose to force the wife into a position where she would have to come back.

31. Counsel quite properly indicated that the other problem would be that a sworn valuation may be difficult to obtain because of the husband’s occupation of the house but then again, the wife has not tried.  It seems to me also that the wife can rely on the evidence, sparse as it is, because the husband has not challenged what she says.  He has known for some months about what her position is.  The evidence, therefore, is that the house is worth $450,000 but against that, there are encumbrances of $78,500 or thereabouts to the National Australia Bank, $10,400 in unpaid rates, a debt of the husband’s, apparently associated with his criminal proceedings to Victoria Legal Aid by way of a charge over the property and a $3000 debt for water.

32. If I accept, as I do, that the real interests in this home are as to one third to the wife and two thirds to the children, then the reality is that she has a value of $150,000, against which there are debts of at least $95,000.  I say at least because I presume that the wife has also incurred legal fees in these proceedings and therefore, they have to be paid in some way as well. 

33. Leaving aside that limited equity in the home, there is also superannuation of $44,800 or thereabouts and the wife has tendered the E Super Fund statement as evidence to corroborate her statement.  The debts are also corroborated by documents that have also been produced today.  That being the case, I am dealing with a very modest pool of assets. 

34. The provisions of s 79 give power to the court to make an alteration of the interests of property as between the parties.  One of the provisions, s 79(1), enables the court to also make an order that devolves the benefit of property upon children of a marriage.  Whilst that may be read as meaning devolving a particular interest, it could also be read as effectively rectifying a problem with a title to give effect to the equitable interest that children already have.  It seems to me here that notwithstanding what has happened, the evidence overwhelmingly supports that these two children have always had this equitable interest and now it is time to reflect that in the legal interest.

1. The wife did not come here today with that in mind but that has ultimately been the effect of the orders she has sought. She therefore seeks a declaration under s 78 of the Act. In this case, that declaration can be made because there are proceedings between the parties to the marriage, which gives effect to what ultimately was the intention of the deceased and that is that the husband had no interest. The wife, in using the request for an order under s 79, seeks that I give effect to what is already the equitable interests of the two children.

2. As the High Court recently said in Stanford and Stanford [2012] HCA 52¸ the first step is to decide whether it is just and equitable to alter the interests of the parties in either the equitable interests or legal interests they have. It seems to me that the husband may have some equitable interest in this property but he has not bothered to come here today, nor take part in any of the proceedings, to suggest that he has such an interest. That interest could be recognised in contributions he has made to the renovation of the property or any other form of contribution, as recognised in s 79(4).

3. That being the case, it is just and equitable to make an order here, altering the interests because the home is otherwise inappropriately registered in the names of the husband and wife when the real interests belong to the children and the wife. Having discerned that it is appropriate and just and equitable to make an order to alter the interests, the Court is obliged by s 79 to have a look at the contributions and other matters referred to in s 79(4) of the Act. Section 79(4), as an overview, looks at two specific areas. The first relates to the various contributions that parties make during their relationship and the second relates to the factors in s 75(2) at the economic future of each of the parties.

4. There are other considerations in s 79(4), such as the impact of the order on the earning capacity of the parties and that is not relevant here and child support, which is also not relevant in this case. 

5. On any view of the evidence before me, which I again stress is unchallenged, the wife has been the major contributor the family income.  She has supported herself and the children and she has been, according to the evidence, the primary homemaker and parent of these young children, without much assistance from the husband.  On the basis of the contributions, I would certainly find that there is an overwhelming contribution made by the wife.

6. Section 79(4)(e) requires the court to look at the matters in s 75(2) so far as they are relevant.  I have absolutely no idea what the husband’s future economic circumstances, let alone his current circumstances, may be.  The wife gives no evidence about his financial position when he went to jail, nor how, if at all, he had any involvement in the social security fraud, nor what he is living on at the moment, nor what his future will be if he is evicted from the home.  Again, that may be a disadvantaging factor for the wife but on the other hand, the husband has not bothered to come along to tell me.

7. The wife is currently a qualified healthcare worker, earning a net sum of $900 per week after tax, most of which seems to be going to support the debt associated with the home.  She does not have any dependants because the children are adults, so I can presume that she is able to support herself, taking into account that a significant portion of her income is going towards the debt which, directly and/or indirectly, the husband has benefited in.  The other problem is the difficulty that the wife deposed to in relation to the first borrowing by way of mortgage.  That money has either been lost or the husband has assets overseas.  It is clear, on the evidence, that the husband took that money and went overseas. 

8. The evidence is unsatisfactory because the wife has made no inquiries but the husband did not provide evidence as to whether he does have interests in Europe.  I would suspect, if he took $50,000 or something similar to that overseas, he probably has but the wife is unable to assist.  That gives me some comfort when I think about s 75(2), insofar as it relates to the husband’s future.  It seems to me that this is not a case where I really need to be troubled about the husband at all.

9. There is no basis for me to make any adjustment for s 75(2) purposes.  Having contemplated all of that, the question then is what order is just and equitable? 

10. Section 78, which is the declaration section relied upon by the wife, is not a provision that is effected by s 79(2). I do not have to make an order under s 78 which is just and equitable. Section 78 is really directed to ensuring that the legal and equitable interests are properly protected and as I have already indicated, this is a case where I should make a declaration that the husband has no interest in this property.

11. Turning then to the second part of the order sought by the wife, s 79(2) requires me only to make an order if it is just and equitable to do so. I am satisfied that the wife’s interest is, as I have indicated, very modest. It seems to me, in the circumstances, it is just and equitable to give her the whole of the equity that she will ultimately have in the home. As I have indicated, s 78 declarations reflect the true legal and equitable interests of the property and s 78 requires the Court to make orders that give effect to its declaration. Accordingly, it is appropriate that I make an order that the wife and the husband transfer to the wife and the two children as tenants in common and equal shares the whole of the home, but that must be subject to the payment out by the wife of those liabilities to which I have referred, so that the bank is not disadvantaged, nor is any other creditor put in a position where they are disadvantaged either.

12. In my view, an order transferring all of the equity in the property to the wife, insofar as she has the one-third interest is a just and equitable order. 

13. I have already mentioned the superannuation interests of $44,800, and I have no idea whether the husband has any superannuation entitlements.  Superannuation, as was described in Coghlan & Coghlan (2005) FLC 93-220 is a different species of asset from that mentioned earlier but the same principles in relation to s 79 must be applied to it. It seems that the evidence is that the wife has been the main worker in the household earning an income, and has no doubt contributed to her superannuation in a compulsory way to what is currently there.

14. The wife’s contribution to her superannuation fund is overwhelming, and one which, even if the husband was here, he would struggle to point to any contribution that he has made. 

15. This is not a case where any adjustment should be made for s 75(2) purposes, having regard to the fact that the superannuation is unlikely to vest for a long while yet because of the age of the wife. 

16. Like the real property, superannuation of $44,800 is hardly a large sum of money.  The wife has at least 10 years, if not more, of working life ahead of her before she can retire.

17. Having regard again to the absence of the husband and any cooperation, it seems to me there is no basis for me to make any adjustment in his favour in relation to the superannuation. 

18. I am satisfied that it is just and equitable to make an order that there be no interest adjustment in the superannuation interests of the wife. 

19. I have grave doubts about any cooperation from the husband that the wife will receive to enforce these orders, but in my view it is not appropriate to simply make an order that the husband be ignored.  Accordingly, I propose to make an order that the order be served upon the husband and in due course he can apply to the Court for a copy of these reasons, but I do not propose to have them specifically served upon him. 

20. I am disquieted by the prospect that the wife may have to use the provisions of s 106A of the Act to get the husband’s cooperation to enable the transfers that I am proposing, but rather than have the registrars try and grapple with how that should be done, on the basis that the solicitor for the wife serves these orders, it will be abundantly clear that the husband has a limited period of time in which to sign the transfer, and if he does not return it then the wife through her solicitor can file an affidavit with the registrar deposing to that non-compliance, and the registrar can sign the transfer in the name of the husband accordingly.

21. I have already indicated that the husband will have no interest in the home and therefore has no right to be there.  The wife by her proceedings is seeking vacant possession which is in reality what her entitlement.  There now being no application for costs being pursued, I shall make orders in those terms and direct that not only the orders be served but the reasons be transcribed and be made available in due course. 

I certify that the preceding Fifty Five (55) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 30 April 2013.

Associate: 

Date:  23 May 2013