FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISON 1)
Regan & Regan [2021] FedCFamC1F 159
File number(s): BRC 7426 of 2021 Judgment of: BAUMANN J Date of judgment: 28 October 2021 Catchwords: FAMILY LAW – PROPERTY – INTERIM – Where interim consent orders were made for the husband to pay to the wife weekly spouse maintenance – where the interim consent orders made provision for payments to the wife to cease upon an external controller being appointed to any entity within a Group – where 14 days after the making of those orders the husband caused two entities within the Group to have a liquidator appointed – Wife seeks urgent orders for spouse maintenance – Court finds the husband has capacity to pay – Spouse maintenance orders made Legislation: Family Law Act 1975 (Cth), ss 83, 72, 75 Cases cited: Regan & Regan [2021] FamCA 586
Drysdale & Drysdale [2011] FamCAFC 85
Division: Division 1 First Instance Number of paragraphs: 33 Date of hearing: 21 October 2021 Place: Brisbane Counsel for the Applicant: Mr Hackett Solicitor for the Applicant: Hirst & Co Counsel for the Respondent: Mr Moxon Solicitor for the Respondent: HopgoodGanim Lawyers ORDERS
BRC 7426 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS REGAN
Applicant
AND: MR REGAN
Respondent
ORDER MADE BY:
BAUMANN J
DATE OF ORDER:
28 OCTOBER 2021
THE COURT ORDERS:
1.That on an interim basis pending further order, and in circumstances where Orders 3, 6 and 7 made 19 August 2021 have ceased to apply:
(a)Orders 3, 6, 7 and 14 made 19 August 2021 are discharged;
(b)the husband pay to the wife by way of spousal maintenance until further order the amount of $1,750 per week by payment to a bank account as nominated by in writing.
(c)the husband pay or cause to be paid the following expenses:
(i)In relation to the Motor Vehicle 1 in the wife’s possession:
A.the finance payments/lease payments or repayments relevant to any finance applicable to the vehicle;
B.registration fees; and
C.insurance.
(ii)Costs necessary to maintain the current S Fund private health insurance policy for the family.
(d)The wife’s application for partial property payment of $50,000 is dismissed; and
(e)The wife’s application for an interim injunction be dismissed.
2.That the costs of the parties are reserved.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court…
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CaseChat Overview and Summary
In the matter of Regan & Regan, the parties were before the Family Court to address urgent property and maintenance issues following the final separation of a marriage that lasted over thirteen years. The wife filed legal proceedings shortly after the separation, seeking interim property relief and spousal maintenance. The case has seen multiple hearings, with the most recent one occurring on 22 October 2021. Mr. Hackett appeared on behalf of the wife, while Mr. Moxon represented the husband. Both parties presented oral and written submissions to help clarify their positions. The Court was required to make determinations regarding the division of the parties' property and the amount of spousal maintenance to be paid by the husband to the wife.
The primary legal issues before the Court involved the equitable distribution of the parties' property and the determination of spousal maintenance. Given the husband's involvement in multiple business entities and his failure to fully disclose the financial situation to the wife, the Court needed to assess the extent of the husband's financial obligations and the appropriate allocation of assets. The Court also had to consider the wife's needs, given her primary role in raising the five children and her reliance on her mother for post-separation accommodation. Additionally, the Court had to weigh the husband's assertion that he was trying to manage an orderly sale of assets to prevent further legal proceedings by creditors against the wife's lack of confidence and trust in his financial management.
In its reasoning, the Court considered the husband's business activities and his failure to keep the wife informed about the financial state of their affairs. The Court noted the husband's involvement in highly leveraged business pursuits in the construction industry, which had resulted in substantial borrowings and significant debt. The wife had left the business development to the husband while she focused on the children. The Court found that the husband's actions, including not fully disclosing the financial peril of their business activities, had eroded the wife's trust and confidence. The Court also took into account the husband's previous assertions about the financial health of their marriage, which now appeared to be incorrect. In light of these factors, the Court ordered the husband to provide spousal maintenance to the wife, taking into account her needs and the husband's ability to pay. The Court also considered the wife's contribution to the marriage and the need for an equitable division of property.
The Court's final orders included the payment of spousal maintenance by the husband to the wife, reflecting her needs and the husband's capacity to pay. The Court also addressed the distribution of property, ensuring an equitable outcome for both parties. The Court emphasized the importance of transparency and cooperation between the parties in managing their financial affairs moving forward.
The primary legal issues before the Court involved the equitable distribution of the parties' property and the determination of spousal maintenance. Given the husband's involvement in multiple business entities and his failure to fully disclose the financial situation to the wife, the Court needed to assess the extent of the husband's financial obligations and the appropriate allocation of assets. The Court also had to consider the wife's needs, given her primary role in raising the five children and her reliance on her mother for post-separation accommodation. Additionally, the Court had to weigh the husband's assertion that he was trying to manage an orderly sale of assets to prevent further legal proceedings by creditors against the wife's lack of confidence and trust in his financial management.
In its reasoning, the Court considered the husband's business activities and his failure to keep the wife informed about the financial state of their affairs. The Court noted the husband's involvement in highly leveraged business pursuits in the construction industry, which had resulted in substantial borrowings and significant debt. The wife had left the business development to the husband while she focused on the children. The Court found that the husband's actions, including not fully disclosing the financial peril of their business activities, had eroded the wife's trust and confidence. The Court also took into account the husband's previous assertions about the financial health of their marriage, which now appeared to be incorrect. In light of these factors, the Court ordered the husband to provide spousal maintenance to the wife, taking into account her needs and the husband's ability to pay. The Court also considered the wife's contribution to the marriage and the need for an equitable division of property.
The Court's final orders included the payment of spousal maintenance by the husband to the wife, reflecting her needs and the husband's capacity to pay. The Court also addressed the distribution of property, ensuring an equitable outcome for both parties. The Court emphasized the importance of transparency and cooperation between the parties in managing their financial affairs moving forward.
Orders
Orders of the court
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Background
Background to the litigation
Because of the urgent manner in which the proceedings were listed, not all applications were considered on 22 October 2021, when Mr Hackett of counsel appeared for the wife and Mr Moxon of counsel appeared for the husband. Before dealing with the competing positions, which were helpfully illuminated by both oral and written submissions, it is appropriate to provide a succinct contextual background.BACKGROUND The parties separated finally in June 2021 after a marriage of over 13 years which bore five children. Legal proceedings were filed by the wife within days of the separation, and the matter has been before the Court for interim property relief on 15 July 2021 and 19 August 2021, before the most recent interim hearing. Although parenting issues are also before the Court, these Reasons only deal with the urgent property and spouse maintenance issues. In short it is clear that:(a)although a professional with his own business, said by the husband to previously having been profitable, the husband had ventured into other business pursuits in the building and construction industry;(b)these pursuits involved securing substantial borrowings to maintain the business activities – and on any assessment were highly geared;(c)the wife, whilst aware of the nature of the activities, left the business development broadly to the husband to manage, whilst she was committed to the care and welfare of the five children who’s ages span from 14 years to the twins now aged four years;(d)the husband did not honestly keep the wife appraised of what is now evident – namely that the mix of business activities (involving at least 34 separate but related entities) were in financial peril with at least two major creditors – the Commonwealth Bank of Australia (“CBA”) and V Finance each owed many millions of dollars;(e)the family home had to be sold quickly (with no return to the parties), causing post separation the wife and five children to rely upon her mother for accommodation. The husband rented an apartment;(f)although I accept there is a complex network of entities, and the husband says he is trying to avoid personal bankruptcy and trying to manage an orderly sale of assets to prevent further legal proceedings by creditors, it is clear that complete discovery to the wife by the husband has not occurred in a timely manner. The husband’s actions have not assisted in giving the wife any confidence that the husband’s earlier assertions (before separation) that the parties were in a healthy financial position, is incorrect. She is trying to come to grips with what appears to be a virtual collapse of their financial position;(g)This lack of confidence and trust has not been assisted by the positions adopted by the husband, retaining senior counsel on two previous occasions to submit, in short, that:(i)in July 2021, the CBA had to receive some available funds of $3,000,000 otherwise a catastrophe would occur. For reasons set out in my Reasons for Judgment delivered 15 July 2021 (Regan & Regan [2021] FamCA 586), I did not accept that submission and essentially injuncted funds until August 2021, whilst ordering the wife to receive $100,000 as a partial property settlement;(ii)in July 2021, the husband’s position was that overall debts exceeded assets by some millions of dollars;(iii)when the matter returned to the Court on 19 August 2021, the Court was informed that Supreme Court proceedings launched by V Finance necessitated the injuncted funds to be paid to that company, not the CBA. The said interim Orders facilitated that payment, and those Supreme Court proceedings have now been settled;(iv)the CBA has made demand upon the parties’ entities for repayment of various debts totalling in excess of $8 million. The CBA has, it seems, some security over business equipment and a sale of various items has allowed nett proceeds to be paid to the CBA as each piece of equipment is sold, the husband claims, in an orderly manner. On 19 August 2021, the husband deposed to the aspiration that with an orderly sale of equipment, rather than having a deficit, it was his hope that a nett balance of around $950,000 would be available;(v)it now appears that the husband and a Mr Neagle who is involved in the husband’s previous business (and some early real property transactions), have decided to commence a business partnership from 1 November 2021 to be known as T Company. Hardly surprising, the wife is suspicious about the true motivation of the husband for this new business entity, and is concerned about what is to happen with the old business operated by the husband (“J Company’) and, in particular, the debtors of that business and the accumulated but not recovered Work in Progress (“WIP”)THE ISSUES TO BE DECIDED URGENTLY
Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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