Reilly and Reilly - [2015] FCCA 2513

FEDERAL CIRCUIT COURT OF AUSTRALIA

REILLY & REILLY

[2015] FCCA 2513

Catchwords:
FAMILY LAW – Property – distribution of property.

Legislation:

Family Law Act 1975, ss.75(2), 79

In the Marriage of Lee Steere and Lee Steere (1985) FLC 91-626
In the Marriage of Ferraro (1993) FLC 92-335
In the Marriage of Clauson (1995) FLC 92-595

Applicant:

MS REILLY

Respondent:

MR REILLY

File Number:

PAC 4844 of 2013

Judgment of:

Judge Donald

Hearing dates:

4 & 5 May 2015

Date of Last Submission:

5 May 2015

Delivered at:

Parramatta

Delivered on:

23 September 2015

REPRESENTATION

Counsel for the Applicant:

Mr J. Longworth

Solicitors for the Applicant:

Shephard & Shephard

The Respondent appeared in person

ORDERS

That the Respondent Husband pay to the Applicant Wife the sum of $310,391 within 60 days of the date of these Orders.
That contemporaneously with the payment to the Applicant Wife of the sum referred to in Order (1):
(a)The Applicant Wife do all things and execute all documents necessary to transfer to the Respondent Husband all her right title and interest in the former matrimonial home situate and known as Property J, New South Wales, Folio Identifier (omitted).
(b)The Respondent Husband pay all moneys (if any) and do all things necessary to obtain the discharge of mortgage registered number (omitted) to (omitted) Bank secured upon the title of the former matrimonial home.
That if the Respondent Husband fails to pay to the Applicant Wife the sum referred to in Order (1) herein within the prescribed time or if the Respondent Husband fails to obtain the discharge of mortgage pursuant to Order (2) herein within the prescribed time, then within a further 30 days the Respondent Husband and the Applicant Wife do all acts and things and sign all necessary documents to effect the sale of the former matrimonial home. In this regard:
(a)The former matrimonial home shall be listed for sale by private treaty with such agent as the parties may agree and in the absence of agreement within 74 days of the date of these orders then with an independent agent trading in the (omitted) area, to be nominated by the Applicant Wife (“the appointed agent”) at a list price as the parties agree in writing, and in the absence of agreement within 14 days of the nomination of the appointed agent at the list price determined by the agent.
(b)If the former matrimonial home is not sold within 5 weeks of first listing then the former matrimonial home is to be offered for sale by public auction through a licensed public auctioneer agreed by the parties or failing agreement to be appointed by the Applicant Wife. The reserve price is to be agreed between the parties and if there is no agreement within 14 days of the auctioneer being appointed the reserve price is to be determined by the Applicant Wife.
(c)The following terms and conditions are to apply to the sale of the former matrimonial home:
(i)The parties shall have authority…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Reilly and Reilly [2015] FCCA 2513
Case: [2015] FCCA 2513
Decision Date: 23 September 2015

CaseChat Overview and Summary

This matter concerned financial orders made by Judge Donald in proceedings between the Applicant Wife and the Respondent Husband. The core of the dispute revolved around the division of the parties' assets and liabilities, particularly the former matrimonial home and the Respondent Husband's shareholdings in a company.

The court was required to determine the specific financial orders to be made, including the payment of a sum of money from the Respondent Husband to the Applicant Wife, the transfer of interests in the former matrimonial home, and the sale of that property if certain conditions were not met. Further issues included the allocation of responsibility for the mortgage and outgoings on the former matrimonial home, the ownership of the Respondent Husband's company shares, and the mutual release of debts between the parties. The court also had to consider the costs and liabilities associated with the division of assets.

Judge Donald ordered the Respondent Husband to pay the Applicant Wife $310,391 within 60 days, contemporaneously with the transfer of her interest in the former matrimonial home to him, provided he discharged the mortgage. If the Husband failed to meet these obligations, the former matrimonial home was to be sold by private treaty or public auction under detailed terms and conditions, with the proceeds distributed in a specific order of priority. The Applicant Wife was to receive 55% of the parties' net assets overall. The Respondent Husband was granted the right to occupy the former matrimonial home pending payment or sale and was to indemnify the Applicant Wife against all liabilities related to the home and his company shares. Each party was declared solely entitled to other property not specifically mentioned and mutually released each other from existing debts, with each party being solely liable for costs and liabilities attaching to assets they received. The Registrar was appointed to execute documents if either party failed to comply with the orders.

Orders

Orders of the court

That the Respondent Husband pay to the Applicant Wife the sum of $310,391 within 60 days of the date of these Orders.

That contemporaneously with the payment to the Applicant Wife of the sum referred to in Order (1):

(a) The Applicant Wife do all things and execute all documents necessary to transfer to the Respondent Husband all her right title and interest in the former matrimonial home situate and known as Property J, New South Wales, Folio Identifier (omitted).

(b) The Respondent Husband pay all moneys (if any) and do all things necessary to obtain the discharge of mortgage registered number (omitted) to (omitted) Bank secured upon the title of the former matrimonial home.

That if the Respondent Husband fails to pay to the Applicant Wife the sum referred to in Order (1) herein within the prescribed time or if the Respondent Husband fails to obtain the discharge of mortgage pursuant to Order (2) herein within the prescribed time, then within a further 30 days the Respondent Husband and the Applicant Wife do all acts and things and sign all necessary documents to effect the sale of the former matrimonial home. In this regard:

(a) The former matrimonial home shall be listed for sale by private treaty with such agent as the parties may agree and in the absence of agreement within 74 days of the date of these orders then with an independent agent trading in the (omitted) area, to be nominated by the Applicant Wife (“the appointed agent”) at a list price as the parties agree in writing, and in the absence of agreement within 14 days of the nomination of the appointed agent at the list price determined by the agent.

(b) If the former matrimonial home is not sold within 5 weeks of first listing then the former matrimonial home is to be offered for sale by public auction through a licensed public auctioneer agreed by the parties or failing agreement to be appointed by the Applicant Wife. The reserve price is to be agreed between the parties and if there is no agreement within 14 days of the auctioneer being appointed the reserve price is to be determined by the Applicant Wife.

(i) The parties shall have authority to conduct the sale and to receive and disburse sale monies;

(ii) The parties are ordered to jointly instruct solicitors to act on their behalf in the sale and if the parties are unable to agree as to the firm of solicitors within 74 days of the date of these orders, the Applicant Wife shall nominate a solicitor to act on behalf of the parties;

(iii) The parties shall have authority to approach real estate agents and to make any necessary arrangements for the sale of the former matrimonial home.

(d) That if following any attempted sale of the former matrimonial home by public auction, the former matrimonial home does not reach the reserve price, and the parties are unable within 7 days of the date of the auction to agree as to the sale of the former matrimonial home by private treaty at a reduced price, then the parties shall list the former matrimonial home for sale by way of public auction and the terms and conditions set out herein in relation to the first public auction shall apply mutatis mutandis, save that any further auction shall not take place earlier than 8 weeks after the first and at such public auction the parties shall, if the reserve is not reached, negotiate with the highest bidder and sell the former matrimonial home.

(e) That subject to Order (3)(f), both parties are ordered to attend any auction sale of the home referred to in Order (3)(b) and in the event that the former matrimonial home does not reach the reserve price, either agreed to by the parties or determined in accordance with these orders, then the parties are ordered to enter into negotiations with the prospective purchaser for sale by private treaty at a price either to be agreed to by the parties in writing, or 5% below the reserve price if there is no agreement.

(f) That in the event that either party is unable or unwilling to attend any auction sale of the former matrimonial home, then that party is ordered to ensure that they are either represented at the auction sale by an attorney appointed under a General Power of Attorney authorised to do all things they may otherwise have done or that they are and remain in direct communication by telephone (or otherwise) with the real estate agent present at the auction sale for the whole of the auction sale.

(g) That in relation to the sale of the former matrimonial home, whether by private treaty or public auction, each party is ordered to:

(i) Execute any documents necessary to effect the conduct and completion of the sale;

(ii) Cooperate in all reasonable ways with the real estate agent, solicitors and prospective purchasers in relation to such sale including the making available of the key, allowing for inspection of the former matrimonial home at all reasonable times requested by the real estate agent and ensuring that the home is in a neat and clean condition at the time of inspection by prospective purchasers.

(h) That upon completion of the sale of the former matrimonial home pursuant to these Orders or otherwise, the parties are ordered to do all acts and things necessary to cause the proceeds of sale to be paid and distributed in the following manner and priority:

(i) In payment of fees due for the nomination of a real estate agent, real estate agent’s commission and legal costs and disbursements incurred in relation to the said sale;

(ii) In payment of fees due for the nomination of a valuer and valuation fees, if any;

(iii) Adjustment of rates, if any;

(iv) In payment of all monies owing in relation to the mortgage;

(v) In payment to the parties of all reasonable costs incurred by either of them to prepare and facilitate the sale of the former matrimonial home provided that each party shall produce to the other copies of receipts, invoices or proof of payment;

(vi) To the Applicant Wife such sum so that, taking into account all other assets and resources she retains by virtue of these Orders, the Applicant Wife receives on an overall basis 55% of the parties net assets and liabilities.

That:

(a) Pending the payment to the Applicant Wife of the sum ordered herein, or pending the sale of the former matrimonial home in the alternative, the Respondent Husband has the right to occupy the former matrimonial home and he shall pay and be responsible for all repayments of principal and interest related to the mortgage as well as any rates, charges and taxes related to the use and occupation of the former matrimonial home.

(b) In the event that at the date of completion of any sale of the former matrimonial home there are any outstanding such mortgage repayments, rates, charges or taxes, then an amount equal to 55% of the total sum required to pay those amounts shall by deducted from the monies payable to the Respondent Husband from the sale proceeds and be paid instead to the Wife.

That the Respondent Husband is ordered to do all acts and things and sign all documents necessary to indemnify and keep indemnified the Applicant Wife from:

(a) All liabilities and repayments associated with any debt, loan, mortgage or other facility secured upon the former matrimonial home, whether registered on the title or not.

(b) All rates, taxes levies and all other outgoings including utility expenses relating to the former matrimonial home.

That the Respondent Husband is hereby declared the sole legal and beneficial owner of his shareholdings in the company known as (omitted) Pty Ltd (“the (omitted)”).

That the Respondent Husband indemnify and thereafter keep indemnified the Applicant Wife in respect of all and any liability incurred by either of them in respect of the (omitted) Pty Ltd including, but not limited to:

(a) Liability in relation to loan accounts or pursuant to a guarantee or personal covenant(s);

(b) Liability incurred at the suit of any of the aforementioned entities or their shareholders, unit holders or office bearers;

That the Respondent Husband and the Applicant Wife are each solely entitled to the exclusion of the other to all other property and resources not already referred to in these orders in the possession of that party on the date of these orders.

That save and except as these orders provide to the contrary, each of the parties shall, by this order, mutually release the other from all debts owing from one to the other.

10.

That each party, as against the other, is solely liable for all and any costs, debts, expenses or liabilities of any nature whatsoever attaching to any asset or financial resource to which that party is entitled pursuant to these orders and that the liable party indemnify and keep indemnified the other party in respect of all and any such costs, debts, expenses or liabilities.

11.

That each party is at liberty to apply on 7 days’ notice in relation to the implementation of these orders.

12.

That in the event that either party refuses or neglects to comply with the provisions of these Orders then the Registrar of a Court exercising competent jurisdiction shall be appointed pursuant to section 106A(1) of the Family Law Act 1975 to execute all deeds and documents in the name of the Respondent Husband and/or the Applicant Wife and do all acts and things necessary to give validity and operation to the said orders.

Background

Background to the litigation

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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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