Riemann and Riemann and Ors (No 5)
[2017] FamCA 986
•4 December 2017
FAMILY COURT OF AUSTRALIA
| RIEMANN & RIEMANN & ORS (NO. 5) | [2017] FamCA 986 |
| FAMILY LAW – PROPERTY – INTERIM PROCEEDINGS – Where the wife sought orders for a further partial property distribution in the amount of $2,090,682.47, being $1,555,492.03 for the further cost of litigation and $535,190.44 to provide for projected future living costs – Where the husband and wife have previously received a partial property distribution of $4,000,000 and $4,550,000 respectively - Where the husband opposes the orders sought – Consideration of section 79 of the Family Law Act 1975 (Cth) factors – Court finds that it is not in the interests of justice for there to be a further partial property distribution where the estimate of future legal fees is based on unreasonable costs – Court finds that a further partial property distribution should not be made prior to the Court having the opportunity of considering the parties’ contentions in the context of all of the evidence to be presented at final hearing – Court finds that the amount the wife has received previously by way of partial property distribution could reasonably be expected to have met expenses to provide for a comfortable standard of living and meet reasonable legal fees prior to the final hearing - Wife’s application for a partial property distribution dismissed |
| Family Law Act 1975 (Cth) ss 79, 80(1) |
Acton & Burton [2015] FamCA 469
| Davidson and Davidson (No 2) (1994) FLC 92-469 Strahan & Strahan (Interim Property Orders) (2011) FLC 93‑466 Strahan and Strahan (No 2) [2012] FamCA 248 Stanford and Stanford (2012) 247 CLR 108 Wenz v Archer (2008) 40 Fam LR 212 | ||
| APPLICANT: | Ms Riemann | |
| RESPONDENT: | Mr Riemann |
| SECOND RESPONDENT: THIRD RESPONDENT: | Ms Lindrum Ms Gildas | |
| INDEPENDENT CHILDREN’S LAWYER: | Legal Aid New South Wales | |
| INTERVENORS: | Mr Aaron and Y Pty Ltd | |
| FILE NUMBER: | SYC | 5764 | of | 2014 |
| DATE DELIVERED: | 4 December 2017 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | McClelland J |
| HEARING DATE: | 20 November 2017 |
REPRESENTATION
The Applicant appeared in person
| COUNSEL FOR THE RESPONDENT: | Mr O'Ryan QC and Mr Richardson SC |
| SOLICITOR FOR THE RESPONDENT: | Broun Abrahams Burreket |
The Second Respondent, the Third Respondent was excused, the Independent Children’s Lawyer and the Intervenors were excused
Orders
THE COURT ORDERS THAT:
The wife’s Application in a Case filed on 11 October 2017 is dismissed.
AND THE COURT NOTES THAT:
A. The matter remains listed for final hearing for 10 days commencing 29 January 2018.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Riemann & Riemann & Ors (No.5) has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYC 5764 of 2014
| Ms Riemann |
Applicant
And
| Mr Riemann |
Respondent
And
| Ms Lindrum |
Second Respondent
And
Ms Gildas
Third Respondent
And
Legal Aid New South Wales
Independent Children’s Lawyer
And
Mr Aaron and Y Pty Ltd
Intervenors
REASONS FOR JUDGMENT
INTRODUCTION
This matter concerns an application by the wife for orders providing for a further distribution of property, prior to the final hearing of this matter. The amount sought is $2,090,682.47. The final hearing of this matter has been listed for 10 days commencing 29 January 2018. The application is made in the context where the parties have previously agreed to and received partial property distributions totalling $8,550,000, with the husband receiving distributions totalling $4,000,000 and the wife receiving distributions totalling $4,550,000.
Those amounts have been received in the three years subsequent to the commencement of the substantive proceedings which occurred by way of an Application for Final Orders filed by the husband, Mr Riemann, on 15 September 2014. Since that time there have been a number of interim hearings concerning both parenting and property matters. The final hearing, which had been listed for a period of 10 days commencing on 13 June 2017, was adjourned as a result of the wife’s stated inability to attend Court. The circumstances of the adjournment are controversial, with the husband challenging the bona fides of the basis upon which the adjournment was sought. The argument in respect to costs arising from the adjournment is reserved.
The husband has been represented by one firm of solicitors throughout these proceedings. The wife was unrepresented at the hearing of this matter on 20 November 2017. The wife has, however, previously been represented by three different firms of solicitors and several different barristers including senior counsel.
The parties have incurred substantial legal fees in this matter. By way of a costs notice tendered as an exhibit in the proceedings on 26 October 2017, the then solicitors for the wife informed the Court that legal costs incurred by the wife up until 26 October 2017 totalled $2,700,371.[1] Also, by way of a costs notice tendered as an exhibit in the proceedings on 26 October 2017, the solicitors for the husband advised the Court that costs incurred by the husband totalled $1,952,442.[2]
[1] Exhibit W2.
[2] Exhibit H1.
The wife’s costs notice estimated legal costs in respect to the period subsequent to 26 October 2017 to the conclusion of the final hearing to be an additional $1,169,003. The husband’s costs notice estimated that costs to the conclusion of the final hearing to be $508,150.
The wife contends that her application for a further partial distribution of property is necessary in order to provide funding for her to meet the future costs of the litigation in the sum of $1,555,492.03 and also to provide for projected future living expenses, until the completion of the proceedings, estimated to be $535,190.44.[3] The wife’s application is opposed by the husband.
[3] Wife’s Outline of Case Document filed 24 October 2017 at page 24.
BACKGROUND
The parties met in 1990. There is a dispute as to the nature of the parties’ relationship subsequent to the parties’ meeting and until November 1998 when they became engaged. It is common ground that the parties cohabited in the period after November 1998 and that they married in 1999. The husband contends that the parties separated in May 2013 however, the wife contends that the parties separated on 19 December 2013.
The hearing of this matter on 20 November 2017 did not relate to parenting matters. Accordingly, the Independent Children’s Lawyer was excused from attendance. The parties are in dispute in respect to virtually all issues relating to the property proceedings. The areas of dispute include:
·Identification of the parties’ property including allegations of inadequate disclosure and non-disclosure.
·Valuation of the parties’ property including the husband’s business interests.
·The initial financial contributions of the parties.
·The financial contributions made during the course of the parties’ relationship and subsequent marriage.
·The non-financial contributions made by the parties during the course of their relationship and subsequent marriage.
·The future needs of the parties.
·Allegations that the husband has engaged in inappropriate business transactions to the detriment of the wife.
Since the proceedings were adjourned in June 2017, there have been seven separate Court events. Those Court events have each resulted in the Court making orders of a substantive or procedural nature. In some cases, those orders have been made with the consent of the parties. In addition, with the consent of the parties, orders have been made in Chambers on four separate occasions.
Competing applications
The wife’s application
The wife sought the following orders in her Application in a Case filed 11 October 2017:
1. Liberty to serve short notice of this application.
2. That from the monies held in the joint names of the parties at the National Australia Bank in a Term Deposit account number …39 and/or account number …62 the amount of $2,090,682-47 be forthwith released to the Wife as and by way of partial property settlement.
3. That the parties forthwith do all things and sign all documents necessary to give effect to Order (2) hereof.
4. That in the event that any party refuses, neglects or otherwise fails to do anything or sign any document necessary to give effect to Order 2 hereof then the Registrar of the Family Court of Australia Sydney Registry is hereby appointed to do such thing or sign such document on his or her behalf, and for such purpose the signature of the Registrar of the Sydney Registry of the Family Court of Australia shall be deemed to be the signature of such party.
5. That the Wife’s costs and incidental to this Application be reserved.
The husband’s application
The husband sought the dismissal of the wife’s application as set out in his case outline document provided to the Court on 26 October 2017 at paragraph 52.
Evidence and witnesses
During the course of the hearing, the wife relied upon the following documents:
· Case Outline dated 24 October 2017 (paragraphs 83 to 96 inclusive);
· Application in a Case filed 11 October 2017;
· Wife’s affidavit sworn 10 October 2017 and filed 11 October 2017;
· Affidavit of Mr II sworn 10 October 2017 and filed 11 October 2017; and
· Extract from the Affidavit of Mr BB sworn 24 October 2017 (paragraphs 30 to 35 inclusive).
The husband relied upon the following documents:
· Case Outline dated 26 October 2017 (paragraphs 3 - 9 and 11-13 );
· Husband’s affidavit sworn 26 October 2017 and filed 30 October 2017 (paragraphs 121 to 150 inclusive); and
· Husband’s affidavit sworn and filed 15 May 2017 (paragraphs 1,17, 18, 68 to 71, 401-402, 430-431 and 466 – 495).
CONSIDERATION
In the case of parties to a marriage, the legislative foundation for an order for partial property distribution is sections 79 and 80(1)(h) of the Family Law Act 1975 (Cth) (“the Act”). In combination, these sections confer power on the Court to make orders for interim property settlement. Section 80 is not, in itself, a source of jurisdiction for an order for the partial distribution of property to be made in the course of interim proceedings. Rather, the section is an “enabling provision” that provides various ways in which the general power in section 79 may be exercised in individual cases.
It is clear that the power to make orders pursuant to section 79 can be exercised prior to final hearing including through “a succession of orders until the power ... is exhausted” or until a final order dealing with all the known property of the parties is made.[4]
[4] Gabel & Yardley (2008) FLC 93-386, cited in Strahan & Strahan (Interim Property Orders) (2011) FLC 93‑466 at 85, 640 [113]; [2009] FamCAFC 166.
However, as noted by Thackray J in Strahan & Strahan (“Strahan”):[5]
…it is important to note that s 80(1) is couched in the permissive. Hence, although the Court must give consideration to the matters set out in s 79(4) when hearing an application for an interim payment, it has no obligation to make an interim order. The Court “may” do so if it considers that it should in the exercise of its discretion.
[5] Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466; [2009] FamCAFC 166 at [223].
In Strahan,[6] the Full Court held that there are two steps to considering an application for an order for partial property distribution prior to final hearing.[7]
[6] Ibid.
[7] Ibid at 85,641; at [118].
The first stage is a “procedural step” which requires an analysis of whether the circumstances of the case trigger the Court’s power to invoke section 80(1)(h) of the Act to make an order for interim property settlement before a final hearing. At this stage, the “overarching consideration” is the interests of justice.[8]
[8] Ibid at 85,645; at [132].
The second stage is the “substantive step” where the provisions of section 79 must be considered and applied but with limitations, given that it is not the final hearing.[9]
[9] Ibid at 85,645; at [135].
In determining the first stage, the Full Court in Strahan said:
In relation to the first stage, in our view, when considering whether to exercise the power under s 79 and s 80(1)(h) of the Act to make an interim property order the “overarching consideration” is the interests of justice. It is not necessary to establish compelling circumstances. All that is required is that in the circumstances it is appropriate to exercise the power. In exercising the wide and unfettered discretion conferred by the power to make such an order, regard should be had to the fact that the usual order pursuant to s 79 is a once and for all order made after a final hearing.[10] (emphasis added)
[10] Ibid at [132].
Nonetheless, in Stanford and Stanford,[11] the High Court held that consideration as to whether there should be an order for the adjustment of the parties’ legal and equitable interests in matrimonial property should not be commenced with the assumption “that one or other party has the right to have the property of the parties divided between them”.[12] This applies to an application for a partial distribution of property in interim proceedings as much as it does to an application for the adjustment of property at the final hearing of the matter.
[11] Stanford v Stanford (2012) 247 CLR 108; [2012] HCA 5 at [40].
[12] Ibid; Medlow & Medlow (2016) FLC 93-692 at 81,089; [2016] FamCAFC 34.
In other words, an applicant for orders for the partial distribution of property is required to satisfy the Court as to why it is in the interests of justice for such an order to be made rather than for there to be a once and for all order made at final hearing.
The second step involves the exercise of the power pursuant to section 79 of the Act.[13] In turn, insofar as it is possible in interim proceedings, this step requires the Court:
·to identify “the parties’ property and of their interests in it”;[14] and
·to consider and apply the provisions of section 79.[15]
[13] Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466; [2009] FamCAFC 166 at [135] to [137].
[14]Medlow & Medlow (2016) FLC 93-692; [2016] FamCAFC 34 at [69].
[15] Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466; [2009] FamCAFC 166 at [135] to [137].
Section 79 should be applied in the context of the interim proceedings and, in particular, recognising the Court’s difficulty in making findings of fact in interim proceedings. Nevertheless, while these are interim proceedings, that does not relieve the applicant “from the obligation of establishing the necessary prerequisites for the grant of the relief sought”.[16]
Is it in the interests of justice for an order for partial distribution of property to be made prior to final hearing?
[16] Acton & Burton [2015] FamCA 469 at [29].
The task of determining whether it is in the interests of justice for an application for partial distribution of property to occur prior to final hearing involves a consideration of not only the parties’ interests but also the public interest. In that respect, in Strahan the Full Court said:[17]
In exercising the wide and unfettered discretion conferred by the power to make such an order, regard should be had to the fact that the usual order pursuant to s 79 is a once and for all order made after a final hearing.
[17]Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466; [2009] FamCAFC 166 at [132].
In a similar context, Thackray J said:
The Court must first identify circumstances that make it appropriate to give consideration to exercising its power to make an interim order. It is at this stage that the Court has regard to the policy consideration that it is generally in the interest of the parties and the Court for there to be only one exercise of the s 79 power.[18]
[18]Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466; [2009] FamCAFC 166 at [226].
Further to the policy consideration referred to by Thackray J, it is also important to note the obligation on the parties and the Court to further the main purpose of the Family Law Rules 2004 (Cth) (“the Rules”) which is set out in rule 1.04 as follows:
Main purpose of Rules
The main purpose of these Rules is to ensure that each case is resolved in a just and timely manner at a cost to the parties and the court that is reasonable in the circumstances of the case. (emphasis added)
Unless satisfied that it is in the interests of justice, the Court should avoid hearing a multiplicity of interim applications that traverse matters that will ultimately be considered in an orderly and considered way at final hearing.
As noted, in this matter, the wife seeks an order for interim property settlement in the sum of $2,090,682.47. At paragraph 83 of the wife’s Case Outline Document dated 24 October 2017 it is stated that:
$1,555,492.03 relates to the future costs of the litigation and $535,190.44 relates to projected future living costs of the Wife.
As stated, the parties have, to date, received combined interim property distributions totalling $8,550,000. The wife has received $4,550,000.[19]
[19] Wife's Case Outline Document filed 24 October 2017 at [84].
At the hearing of this matter on 20 November 2017, the wife, who was self-represented, was asked whether she was in a position to clarify what had happened to the balance of the funds that she had received totalling $4,550,000.
In response, the wife indicated that she was “not exactly” in a position to explain how the funds have been expended however, she stated that:
I think that - I know that [BC] is nearly a half million. I know that - I think that [CD] was about two and a half million, possibly, so that’s three million, and then [DE], and I’m not too sure how much that was…[20]
[20] Transcript of proceedings dated 20 November 2017 at page 19.
The costs notice provided to the Court by the wife’s previous solicitors stated that costs up to and including 26 October 2017 were $2,532,621, of which the wife had paid $2,244,567.[21] The costs notice estimated that additional “unbilled” costs incurred up to 26 October 2017 were $167,750. In the context of the wife’s somewhat tentative account of legal expenses that she has incurred, I am of the view that the costs notice, tendered in the wife’s case on 26 October 2017, is more likely to be accurate and that the wife had paid the amount of $2,244,567 by way of legal expenses.
[21] Exhibit W2.
It is well established that it may be appropriate for there to be an order for the partial distribution of property to enable a party to proceedings to meet their legal costs.[22] In that respect, it has been observed that, insofar as it is reasonably possible, an attempt may be made to level the litigation playing field.[23] In the context of interim property orders, in Strahan,[24] Boland and O’Ryan JJ discussed relevant authorities and noted:
In Poletti and Poletti Nygh J, when describing an application for “interim costs”, referred to the reasons of the Full Court in Wilson and Wilson and said it is a “situation where one party to the marriage controls almost exclusively what might be described as the patrimony of the parties and has control of the bulk of the assets and funds of the parties, where an order may be made to ensure that the other party, who does not have the fortune of controlling those funds, at least has an equal or near equal opportunity to present his or her case”: see also In the Marriage of Polletti at 796 per the Full Court (Ellis, Strauss and Butler JJ). The Full Court in Zschokke at 83,220 made a number of relevant remarks about the “desirability of legal representation for both parties in family law proceedings” (citations omitted).[25]
[22] Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466 at 85,631; [2009] FamCAFC 166 and cases referred to therein.
[23] Iphostrou & Iphostrou and Ors [2011] FamCA 20 at [60].
[24](2011) FLC 93-466; [2009] FamCAFC 166 at [80].
[25] Ibid at [80].
In these interim proceedings, I am satisfied that the partial property distributions which the parties have received to date and which have resulted in the wife receiving funds totalling $4,550,000 have been sufficient to even the litigation playing field for the duration of the proceedings.
Further, the wife has not established, to the Court’s satisfaction, that the additional amount she seeks in respect to “the future costs of the litigation”,[26] in the sum of $1,555,492.03, is reasonable.
[26] Wife's Case Outline Document filed 24 October 2017 at [83].
In that respect, in Paris King Investments Pty Ltd & 1 ors v Michael Norman Rayhill & 2 ors,[27] Brereton J said:
Although there is some authority for the view that financial provision for litigation expenses should be calculated in accordance with the authorised scale of costs [Chester, 288], the better view – consistent with the approach that in my view applies in Mareva cases, that a party’s recourse to its assets for the purpose of funding its defence should not be limited to the bare minimum [Harrison Partners Construction Pty Ltd v Jevena Pty Ltd [2006] NSWSC 317, [11], and see [50] below] - is that a Court may make provision for litigation expenses at a rate that appears reasonable in all the circumstances [A Dickey, “Interim Financial Provision for Litigation Expenses: In the Marriage of Zschokke” (1997) 11 AJFL 231, 233]. (emphasis added)
[27][2006] NSWSC 578 at [31].
At paragraphs 28 through to 30 of his affidavit sworn on 10 October 2017, Mr II, a Partner of the wife’s previous solicitors, set out the basis upon which the wife’s claim for future legal fees has been calculated. At paragraph 28 of his affidavit, Mr II refers to a schedule wherein he has set out his calculations of estimated future legal costs. That schedule is annexure “O” to his affidavit.
A preliminary examination of annexure “O” to Mr II’s affidavit shows several areas of immediate concern. These are as follows:
·Item 1 includes work undertaken in respect to the wife’s amended application in a case dated 6 September 2017. It appears that costs have already been rendered in respect to that event.
·Item 2 includes contingency in the event of the wife being successful in joining Y Pty Ltd and Mr Aaron to the proceedings. By orders made on 17 November 2017 the wife’s application in that respect was dismissed.
·Item 7(b) includes an item in respect to attendance on delivery of judgment in the sum of $1991 including GST. This is in addition to items 6(c) in respect to the attendance of both senior and junior counsel at a cost of $3080 including GST. It is the Court’s usual practice to excuse attendances for the purpose of receiving judgment. This is because judgments are communicated to the parties, electronically, immediately once that judgment is delivered.
·Item 4 includes attendance at a mediation when there is no evidence that the parties have agreed to a mediation. This is in addition to counsel’s fees in attending the mediation.
·More generally, the costs notice estimates a total of $131,890 inclusive of GST for three solicitors to attend the final hearing and instruct both junior and senior counsel. Item 7(b) sets out a daily rate of $11,990 not including GST per day for the three solicitors to attend Court over the course of the final hearing. This compares to a combined amount for both senior and junior counsel of $14,000 per day not including GST.
As a result of the inclusion of those matters and the calculation based on three solicitors attending at Court at the final hearing, the estimate of future legal expenses, as set out in annexure “O” to Mr II’s affidavit, is not reasonable in the circumstances.
Specifically, in my view, those costs would not be considered reasonable in accordance with the “assessment principles” set out in rule 19.34 of the Rules. That rule provides that costs must be:
a)reasonably necessary for the attainment of justice; and
b)proportionate to the issues in the case.
The amount of $11,990 per day for instructing solicitors to attend Court at the final hearing, in addition to the fees for senior and junior counsel, cannot be justified as a reasonable expense.
Accordingly, for that additional reason, it would not be in the interests of justice for the Court to order that there be a further partial property distribution as sought by the wife.
It is to be noted, however, that in addition to the payment of legal costs, the wife seeks a partial property distribution to meet her living expenses and that of the parties’ three children. Again, it has been acknowledged that an order for a partial property distribution may also be appropriate where a party may need access to resources “to meet debts which may result in the party being pursued by creditors”.[28]
[28] Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466 at 85,643; [2009] FamCAFC 166 at [123] quoting Wenz v Archer (2008) 40 Fam LR 212.
In that respect, the mother stated that “all I know is that I have three daughters that are walking around in sneakers because I can’t afford to buy new school shoes, and their uniforms are filthy and I can’t buy new uniforms. I mean it’s just - just not right”.[29]
[29] Transcript of proceedings dated 20 November 2017 at page 19.
The wife also stated that the parties’ eldest child is suffering from stress-related conditions and she requires funding to facilitate the child resuming therapy which the mother is unable to afford because she only has the sum of $20,000 to her name.
The wife stated that she needs funds to be able to protect herself and the children moving forward, to obtain legal representation and to have a roof over her head for herself and the children.[30]
[30] Ibid at page 20.
When further clarification was sought from the wife as to whether she was in a position to account for the expenditure of funds over and above that which she has spent on legal fees, the wife stated:
That was our lifestyle. That is our lifestyle. It always was. It was my children’s lifestyle. It is still [Mr Riemann’s] lifestyle. He can still facilitate it by whatever means with his pipeline that comes with all his dividends and what not. He has chosen to starve me out.
Even accepting that as at 26 October 2017, the wife has incurred what can only be described as an extraordinary amount of legal fees totalling $2,700,371, the amount she has received, to date, by way of partial property distribution, could reasonably be expected to have provided a comfortable standard of living for the wife and children as well as meeting reasonable legal fees in the period between 26 October 2017 and the conclusion of the two week trial commencing on 29 January 2018.
In the absence of an adequate explanation from the wife as to how those funds have been applied, the wife has failed to satisfy the Court that the provision of additional funds to meet her living expenses is justified.
In support of the wife’s application for a further partial property distribution, at paragraphs 94 and 95 of the wife’s Outline of Case Document, reference is made to the fact that in Strahan,[31] the wife was “granted 5 million by way of interim property settlement to fund the proceedings”. It should be observed, however, that when a subsequent application was made by the wife in Strahan,[32] for a further partial property distribution, Dawe J referred to that earlier distribution as being a relevant factor in declining to make a further order.[33]
[31]Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466; [2009] FamCAFC 166.
[32]Strahan and Strahan (No 2) [2012] FamCA 248.
[33] Ibid at [87].
Accordingly, for all of these reasons, I find that the wife has not established that it is in the interests of justice for there to be a further partial property distribution prior to the Court having the opportunity of considering the parties’ contentions in the context of all of the evidence that will be presented at final hearing which will commence on 29 January 2018.
Has the Wife established the necessary prerequisites for the grant of the relief she seeks pursuant to section 79 of the Act
As noted, in my decision dated 17 November 2017,[34] the husband contends that the current value of the matrimonial property is $12,683,362.[35] On its face, there would therefore appear to be sufficient funds available to accommodate the order sought by the wife in these proceedings in addition to monies that have previously been paid to the parties.
[34] [2017] FamCA 911.
[35] Husband's Affidavit filed 30 October 2017 at [121].
However, as the majority in Strahan pointed out:
…in order to establish an appropriate case for an interim property settlement order, more is required than the mere fact that upon a final hearing the applicant would receive the property being sought (or an amount in excess of the funds being sought) from the other party.[36]
[36] Strahan & Strahan (Interim Property Orders) (2011) FLC 93-466; [2009] FamCAFC 166 at [139].
The Full Court in Strahan cited with the approval the remarks of Reithmuller FM in Wenz & Archer[37] and held that there was a need to balance “the risks of unduly limiting the final orders that can be made (or even potentially defeating parties’ claims or legitimate expectations) against the circumstances said to show that it is just and equitable to make interim orders”.
[37] (2008) 40 Fam LR 212 at [52].
In this matter, the husband contends that making orders for there to be a further partial distribution of property as sought by the wife would potentially impact upon the Court’s ability to do justice between the parties at final hearing. Specifically, the husband has argued that, having regard to the husband’s initial contribution to the matrimonial property, the parties’ respective contributions during the course of their relationship and the fact that the Court has reserved the question of costs in respect to the adjournment of the hearing that had been listed for June 2017, the Court could not be satisfied that, at final hearing, an adjustment would be made in the wife’s favour over and above the amount she has already received by way of a partial distribution of property together with the additional amount that she seeks in this application.
In that respect, the husband referred to Medlow & Medlow[38] where the Full Court said at 81,090:
86. The onus was clearly upon [the applicant for relief] to establish that there were sufficient assets available for the interim distribution and that the effect of any interim order was capable of being reversed as part of the final hearing or at least would not defeat [the respondent’s]’s property claim. The onus was not on the [applicant] to adduce such evidence.
[38] (2016) FLC 93-692; [2016] FamCAFC 34 at [86].
In this matter, the wife has not discharged that onus. This is because the wife has not established the necessary prerequisites for the grant of the relief she seeks pursuant to section 79 of the Act. As previously noted, it is both sections 79 and 80(1)(h) of the Act which confer power on the Court to make orders for interim property settlement.
In Davidson and Davidson (No 2) (1994) FLC 92-469 at 80, 874, the Full Court stated:
Section 80(1) is limited by its introductory words, namely that “The court, in exercising its powers under this Part, may do any or all of the following ...”. That is, s. 80(1) is activated by the exercise by the court of some other of the powers in Part VIII.
In this case, the relevant power in Part VIII is to be found in section 79. That section confers a discrete power on the Court to make orders for property settlement. An applicant for orders for the adjustment of marital property carries the onus of satisfying the Court that the legislative criteria for the exercise of its discretion are satisfied. This is the case whether the application is made in the context of interim proceedings or final hearing.
As noted by the High Court in Stanford:[39]
…s 79(2) provides that “[t]he court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order”. Section 79(4) prescribes matters that must be taken into account in considering what order (if any) should be made under the section. (emphasis added)
[39] (2012) 247 CLR 108; [2012] HCA 5 at [35].
Section 79(4) is divided into two limbs. The first limb is in respect to those matters set out in paragraphs 79(4)(a) to 79(4)(c), which deal with what are commonly known as the “contribution” factors. Contributions can, in turn, be direct or indirect, financial or non-financial contributions to the matrimonial property. The second limb is in respect to those matters set out in paragraphs 79(4)(d) to 79(4)(g), which primarily relate to the future needs of each of the parties but can include any fact or circumstance which, in the opinion of the Court, the justice of the case requires to be taken into account.
In Stanford,[40] the High Court referred to R v Watson; Ex parte Armstrong[41] in emphasising that in family law property proceedings:
The judge called upon to decide proceedings of that kind is not entitled to do what has been described as ‘palm tree justice’. No doubt he is given a wide discretion, but he must exercise it in accordance with legal principles, including the principles which the Act itself lays down.
[40] Ibid at [38].
[41] (1976) 136 CLR 248 at 257 per Barwick CJ, Gibbs, Stephen and Mason JJ.
At the hearing of this matter on 20 November 2017, the wife stated that she was a housewife who dedicated herself to her children for many years. The wife further stated that she has contributed in many ways to the parties’ relationship and marital property. However, none of the affidavits relied upon by the wife, for the purpose of her interim application filed on 11 October 2017, addressed the issue of either her financial or non-financial contributions to the matrimonial property in terms of those considerations as set out in section 79(4)(a), 79(4)(b) and 79(4)(c) of the Act. As result of the inability to have regard to those matters, the Court is also unable to determine whether it would be “just and equitable,” in terms of section 79(2), to make the order sought by the wife in her Application in a Case.
Accordingly, even if I had found that the wife had established that it is in the interests of justice for the Court to order that there be a further partial distribution of property, I would not have been able to have made such an order because I could not, on the basis of material before the Court, have been reasonably satisfied of those matters set out in section 79 of the Act. As noted by the High Court in Stanford & Stanford,[42] those matters must be considered before an order is made for the adjustment of the parties’ entitlement to marital property.
[42] (2012) 247 CLR 108; [2012] HCA 5.
For all of these reasons I dismiss the wife’s Application in a Case filed on 11 October 2017.
I certify that the preceding sixty-six (66) paragraphs are a true copy of the reasons for judgment of the Honourable Justice McClelland delivered on 4 December 2017.
Associate:
Date: 4 December 2017
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