RINNE & JEWEL
[2018] FCCA 1144
•10 May 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| RINNE & JEWEL | [2018] FCCA 1144 |
| Catchwords: PRACTICE & PROCEDURE – Leave to proceed out of time – conduct of proceedings. |
| Legislation: Family Law Act 1975, ss.44(5), 44(6), 78, 79, 79(2), 79(4), 90SB(a), 90SD, 106A |
| Cases cited: Whitford and Whitford (1979) FLC 90-612 |
| Applicant: | MS RINNE |
| Respondent: | MR JEWEL |
| File Number: | MLC 686 of 2015 |
| Judgment of: | Judge Harland |
| Hearing date: | 28 March 2018 |
| Date of Last Submission: | 28 March 2018 |
| Delivered at: | Melbourne |
| Delivered on: | 10 May 2018 |
REPRESENTATION
| Counsel for the Applicant: | Mr Rothschild |
| Solicitors for the Applicant: | Elisa Rothschild Lawyer |
| The Respondent: | In person |
ORDERS
The husband authorise Aughtersons Solicitors to release the remaining funds held on trust, representing the sale of the Property A as follows:
(a)The sum of $6,781.72 to (Debt Collectors A) for the (omitted energy company) Debt;
(b)The sum of $2,415.56 to (omitted water service);
(c)The remaining funds divided as:
(i)75% to the husband, less the amounts already deducted in payment of the costs order and any amount outstanding pursuant to the Orders of 24 July 2017; and
(ii)25% to the wife.
That pursuant to Section 78 Family Law Act 1975 that each of the husband and the wife shall be and hereby are declared to be the sole and absolute owners at law and in equity of:
(a)all items of furniture, furnishings, personalty, chattels and jewellery;
(b)all monies (whether held in cash or in deposit with any financial institution);
(c)any motor vehicle;
(d)all contributions to or benefits or entitlements arising from membership of any fund of insurance or superannuation whether such interest be present, contingent or expectant;
in the possession, custody or control or each or in which either has an interest which are not otherwise dealt with in these orders.
That each party indemnify and keep the other party indemnified in relation to all debts in their sole name.
That in the event that either party should fail, neglect or refuse to sign or execute any deed, document or instrument required by or to give effect to these Orders then pursuant to Section 106A of the Family Law Act 1975 that the Registrar of the Federal Circuit Court of Australia, Melbourne Registry shall be and is hereby authorised, empowered and directed to sign and execute such deed, document or instrument in the place and instead of such party and to thereafter do all things and acts as are necessary to give validity and operation to same.
IT IS NOTED that publication of this judgment under the pseudonym Rinne & Jewel is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLC 686 of 2015
| MS RINNE |
Applicant
And
| MR JEWEL |
Respondent
REASONS FOR JUDGMENT
The parties were in a de facto relationship. The length of the relationship is in disputed. For convenience I will refer to the parties as husband and wife.
Procedural History
This matter commenced on 2 February 2015 when the applicant filed an application for Final Property Orders.
The matter first came before Her Honour Judge Jones on 14 April 2015. The husband did not appear on this day and the matter was adjourned with costs reserved. The husband was also ordered to file a Response, Affidavit, and financial statement within 28 days.
The wife filed an amended application for final orders, supporting affidavit and notice of risk on 14 April 2015 in which she included parenting orders for the child [X] born 2006. The wife filed an affidavit of service on 20 July 2015 which stated that the documents filed 14 April 2015 had been served on the husband on 8 May 2015.
The matter came before Her Honour Judge Jones on 21 July 2015. The husband again did not attend and had not filed any of the documents required by the Orders of 14 April 2015. Costs were reserved once again.
The husband filed a subpoena addressed to Victoria Police on 20 November 2015. This was the first engagement he had with the proceedings, but he had not yet filed any documents that were required.
The matter came back to Court on 30 November 2015 and the husband appeared for the first time. Orders were made for the parties to attend a conciliation conference on 7 April 2016 and the matter was adjourned.
The husband did not attend the conciliation conference on 7 April 2016. Registrar Moser fixed the costs of the wife for that day at $2,500 and reserved them.
The matter came before His Honour Judge Burchardt on 28 April 2016. The husband again did not appear. His Honour adjourned the matter and reserved the wife’s costs fixed in the sum of $1,000. His Honour further ordered that the wife have leave for the matter to proceed on an undefended basis if the husband failed to appear on the adjourned date.
On 2 June 2016, the husband appeared in Court for the second time. Her Honour Judge Jones ordered that the husband file his documents within 28 days, reserved costs, and requested that Victoria Legal Aid conduct a FDRS in relation to the parenting arrangements for [X]. She further ordered that if the husband did not file his documents in compliance with the orders or failed to appear on the next occasion, the wife have leave to proceed on the next occasion.
The husband finally filed his documents on 28 October 2016.
The matter was again before Her Honour Judge Jones on 3 November 2016. The husband appeared on this day. The husband was granted leave to file an amended response, which included an order seeking that the Court dismiss the application for a de facto property settlement due to lack of jurisdiction. It was further ordered that the husband pay the wife’s costs fixed in the sum of $4,500 within 14 days of those orders. Her Honour also set the matter down for trial and included the standard order that parties file and serve their trial affidavit 28 days before the final hearing.
The matter came before me for the first time on 6 March 2017 due to two applications in a case filed by the wife seeking that the husband pay the $4,500 in costs that had been ordered on the previous occasion. The husband did not appear on this occasion.
The first application in a case filed on 29 November 2016 simply sought an order that the husband pay the wife’s costs fixed in the sum of $4,500. An order in those terms had already been made by Judge Jones. The wife’s lawyer, Ms Rothschild, filed an affidavit by the wife in support of that application the day before filing the application in a case. The order sought was not expressed as an enforcement order.
Ms Rothschild filed another application in a case three days later on 1 December 2016. The second application did refer to enforcing the order made by Judge Jones and also sought costs of the application in a case. On 6 March 2017, I adjourned the matter and reserved the question of costs.
The wife filed a further application in case on 22 June 2017 seeking that the $4,500 be released from the monies held in the Aughtersons’ trust account as a result of the sale of the parties’ former home. This order should have been sought in the first application in a case filed on 29 November 2016 as it provided an effective way of enforcing the orders.
When the matter came back before me on 24 July 2017, the husband again appeared. I ordered:
1. The parties do all acts and things to direct Aughtersons Lawyers to release the following sums from the funds held on trust and make payable to the wife, or as she directs:
a) The sum of $4,500 (plus interest at the rate of 7.5%) and
b) Costs fixed in the sum of $2389.
The wife filed her trial affidavit on 24 October 2017. I note that this was only a week and half before the final hearing, and not the 28 days prior that was required by filing directions of Her Honour Judge Jones. In this affidavit, the wife stated that the husband had yet to comply with the costs orders of 24 July 2017. However, the wife’s case summary document filed on 1 November 2017 states that on 23 October 2017 the husband partially complied with the orders of 24 July 2017 and ordered the release of the $4,500 and the $2,389 sums from the Aughtersons’ trust account. It appears that he did not include the interest on the $4,500 when he ordered the release of the money.
The matter came before me for Final Hearing on 8 November 2017. Despite the lengthy history of the proceedings, the matter was not ready to proceed. The husband did not appear. I noted the following:
A. The matter could not proceed due to insufficient evidence filed by the applicant such that the Court could not determine a just and equitable outcome.
I ordered that both parties file one affidavit of evidence in chief and an updated financial statement on or before 22 November 2017. Neither party complied with this order.
The husband has not filed any documents since 3 November 2016.
The wife filed an amended application for final orders and an affidavit on 15 March 2018.
The husband attended court on 28 March 2018 and participated in final hearing. Both parties were cross-examined and made submissions.
The wife’s case
The wife’s further amended initiating application filed on 15 March 2018 seeks the following:
1. That the [husband] and [wife] shall do all such acts and things and sign all such documents in order to release the remaining funds held on trust with Aughtersons’ solicitors, representing the proceeds from sale of the family home.
2. That the funds in the trust, being the amount of $64,143.60 be applied as follows:
a) 75 per centum thereof to the [wife]; being the amount of $48,107.70;
b) 25 per centum thereof to the [husband]; being the amount of $16,03
…
4. The [husband] do all acts and things necessary, including signing all necessary documents, to divide the [husband]’s [superannuation] funds equally between the [husband] and [wife].
5. That the base amount allocated to the [wife] out of interest of the funds is $25,000.
The wife is no longer seeking parenting orders.
The wife seeks the same percentage of the funds held on trust as she has done since she initiated the proceedings in 2015.
In the wife’s case outline filed 1 November 2018 she sought the following order:
That the Respondent do all acts and things necessary, including signing all necessary documents, to divide the Respondent's superannuation equally (50% each way) between the Applicant and Respondent, in accordance with their respective shares.
It seems that her in amended application filed on 15 March 2018, she has amended the superannuation split order sought, as although she indicates that she still seeks that the funds be divided “equally” she also now seeks that a base amount of $25,000 be allocated to her. In her affidavit filed 15 March 2018 she says that the husband’s total superannuation is $25,000. She now seeks 100% of the husband’s superannuation amount.
The husband’s case
The husband has not engaged in the proceedings consistently since 2016. In his amended response filed on 3 November 2016, he sought the following:
1. That the court dismiss the application for a de facto property settlement pursuant to s90SM on the basis that there is no jurisdiction for such application.
2. In the event that the court finds that there is jurisdiction for a property settlement pursuant to s90SM and s44 of the Family Law Act 1975, the court order as follows:
a) That the money held in trust by Aughtersons be made available and released immediately to the Respondent.
b) That each party retain as their sole property their individual interests in any superannuation fund they may hold.
The parties’ relationship
The parties commenced their relationship in May 2004. Both parties lived with their parents at the time.
In late 2005 they moved into a rental property in (Suburb A) when the wife became pregnant.
[X] was born 2006. She is currently 12 years old.
After [X] was born, the husband moved into his father’s home. The husband says this was the result of domestic violence. The wife disputes these allegations. The husband says that [X] was staying with him one night every weekend during that period.
The wife says they separated in late 2006.
In early 2009 the parties reconciled and bought the property at Property A (“the Property A property”). The wife says they jointly bought the property in the husband’s sole name.
In August 2009 the parties briefly separated. The wife moved out.
In November or December 2009 the wife moved back into the Property A, but the parties were living as though separated under the one roof. Neither party gave clear evidence as to whether or not they stayed separated under the one roof or reconciled during this period.
In late 2011 the wife and [X] moved to the wife’s father’s home. The wife says that they attempted “an array of alternative accommodation” and the husband says that the wife asked to move back into the Property A and requested that he stay elsewhere. He moved out and lived with his grandparents.
In January 2012, the husband moved back into the Property A.
The husband says an incident occurred between the parties on 2 April 2012, in which he suffered stab wound to his elbow which required that he attend (omitted hospital). The wife says that the husband smashed a pipe she was holding and when he lifted up her arm, it cut him. The husband took out an intervention order against the wife.
In May 2012, the wife took out an intervention order against the husband. The husband says he had to physically defend himself from the wife, the wife says it was due to his violent behaviour. [X] remained living with the wife in the Property A. The husband moved out of the Property A again.
Both parties agree that after this the husband attended the Property A to help with the puppies they were raising. The husband further says he would regularly attend the home at night-time to tuck [X] in, and that the wife regularly requested that he stay over while she went out.
The husband says that he was charged with two breaches of the intervention order.
In mid-July 2012 the husband says he received a phone call from the Department of Health and Human Services (“the DHHS”) asking him to collect [X] from school and to keep her in his care. He says that there was a protection order in place. Annexure SJ6 is a Confidential Court Report – disposition report in support of application to extend protection order dated 15 October 2013. The wife claims that the husband contacted the DHHS himself.
In December 2012, the husband had the intervention order reversed and the wife was evicted from the Property A.
The wife says that she and the husband separated on 31 December 2012 when she moved out of the Property A to move in with her father.
The wife’s evidence about the date of the end of the relationship was vague and I am unable to place much weight upon it. Her affidavit sworn 6 April 2015 at [5] says “In or about 2013 the respondent and I separated and have not been in a relationship together since then” but her affidavit sworn 28 July 2017 says at [15] “[Mr Jewel] and I separated on New Year’s Eve 2013 (31 December 2012)”. During cross-examination, the husband put to the wife that although she says they separated in 2013, that it was actually in mid-2012 when the DHHS became involved. She said “to be honest, I wouldn’t have a clue…I don’t know anymore.”
The husband’s evidence is that the relationship ended in mid-2012, but there were many periods of separation before the final separation.
I prefer the husband’s evidence with respect to the final separation date. I find that on the balance of probabilities the relationship most likely ended in early to mid-2012.
The parties met in 2004 and started living together in 2005. They separated in 2006 and reconciled in 2009. Both parties say there were other periods of separation and reunification but the evidence with respect to this is vague.
At best the relationship totalled about 6 years.
The husband’s application to dismiss the wife’s application as being out of time
The husband’s amended response filed 3 November 2016 seeks that the proceedings be dismissed on the basis that there is no jurisdiction for the application. He says that the relationship ended in mid-2012 and, as the wife filed her application in early 2015, two and half years had passed since the end of the relationship. He says there is no jurisdiction under s44(5) of the Family Law Act 1975.
At the final hearing, Mr Rothschild, appearing for Ms Rothschild, said that he had not prepared for this argument as he was not on notice of it. I pointed out to him that it was contained in the husband’s amended response filed 3 November 2016. On the wife’s case she does not need leave to proceed out of time.
As I have found that the relationship ended in early to mid-2012, the wife needs leave to proceed out of time. Section 44(6) of the Family Law Act 1975 governs out of time applications. Several authorities have discussed out of time applications including Whitford and Whitford (1979) FLC 90-612 and Sharp v Sharp [2011] FamCAFC 150.
These proceedings have been on foot for a long time, there is a very small property pool, and there has been money sitting in a trust account since the Property A settled in early 2015 which needs to be dealt with.
I find that hardship would be caused to the wife if leave were not granted for the wife’s application to proceed out of time. I will allow the application to proceed out of time.
Contributions
Husband’s contributions
Both parties agree that the Husband put $30,000 of his savings into the deposit of the Property A.
During the final hearing, the husband said that he accumulated the $30,000 in savings between 2006 and 2009 when the parties were separated. He said that although he had been working during the relationship pre 2006 earning approximately $700-$1000 per week, during 2007 he was able to obtain work with Empoyer A and then with Employer B. He was able to earn a higher income with Empoyer A and Employer B. The husband further said that he was also paying child support during this period.
The husband says that he added a kitchen and undertook structural work to the Property A. The wife agrees that the husband commenced renovations and says that he built a hot house in the back yard, but that meant she did all the housework and cared for the [X] full time.
The husband says that he worked to finance the home and the wife cared for the child, but that they split the household duties 50/50. The wife says that she did all the home duties, but agrees that the husband worked.
The husband says that in mid-July 2012 he was contacted by Child Protective services who advised him to take [X] into his full time care. Annexure SJ6 to the husband’s affidavit is a document titled “Confidential Court Report – Disposition Report in support of application to extend protection order” and dated 15 October 2013. The document refers to [X] being subject to a Protection Order and recommends that it be extended for a period of three more months. He says that [X] went back to live with the wife from January or February 2014 until around the end of May 2014 when the wife was involved in a car accident. He says that [X] has lived with him since then and has spent time with the mother approximately one night per week from mid-2014 until April 2015, and then Wednesday afternoons and Saturday nights. [X] remains in his care.
The husband received an early release from his superannuation fund on the basis of compassionate grounds. Annexure 11 to his affidavit is a letter from the Department of Human Services, dated 1 August 2013, which approves the release of $28,904.60 from his superannuation fund. The husband says that he used these funds to pay the mortgage arrears. At [13] of her affidavit sworn 28 September 2017 the wife agrees that the husband withdrew $25,000 of his superannuation to meet mortgage payment in arrears.
The husband also says that he and his family put in 200-250 hours tidying up the property for sale. He does not provide any particulars. There is insufficient evidence to enable me to make a finding about this.
The Property A was sold on 24 November 2014. The remaining proceeds of sale are held on trust by Aughtersons solicitors.
Wife’s contributions
The wife did not work during the parties’ relationship. She says that she and the husband had an arrangement where he worked and she maintained the home and was primarily responsible for parenting [X].
The wife says the title to the Property A was placed in the husband’s name and held on her behalf. To protect her interest she had her previous lawyer, Ms Fiona Macgregor, lodge a caveat over the property.
The debts
Both parties say that they have various debts that occurred during the course of the relationship. The evidence for the majority of these debts is poor and not sufficient for the Court to be satisfied about which debts are debts of the relationship and which are not.
The husband says that friends and family lent him various sums of money to assist with the mortgage arrears in an attempt to suspend foreclosure of the Property A, and that those debts are still outstanding. He says that these sums were paid directly to (omitted mortgagee). He says that Mr H paid $3,400 on 16 March 2013 and $510 on 18 March 2013, Ms T paid $9,500 on 27 June 2013, and Mr & Ms J paid $17,260.50 on 9 April 2014. Annexures SJ7, SJ8, SJ9 and SJ10 show the above transfers with the reference number 1000000186097 and biller code 67199, except the $510 payment which has neither, from the above-mentioned people’s bank accounts. None of these individuals filed an affidavit and were not available for cross-examination. Whilst the documents show these funds being transferred, they are not proof of the existence of loans that require repayment. I have no evidence as to any terms and conditions of these alleged loans. I cannot be satisfied that these amounts are loans which relate to the relationship.
The wife says at [40] of her affidavit affirmed 14 March 2018 “I note that I have no knowledge of the Respondent borrowing money from friends”.
There are many debts included in the wife’s affidavit sworn 14 March 2018. The only one that was raised during the final hearing was the debt to (Debt Collectors A) for an unpaid (omitted energy company) Debt of $6,781.72. Annexure 02 of the wife’s affidavit filed 15 March 2018 is an (omitted energy company) Account for the Property A. The Electricity account summary is for 05 Sep 2014 to 11 Sep 2014. It says that the opening balance is $6,756.52. It does not say in what period that these charges were accumulated. The husband says that he put the electricity bill in the wife’s name in 2012 when he moved out of the property and that at that point in time there was nothing owing on it. His evidence was vague with regards to whether the bill included the time period that he was living in the house after the end of relationship. I am not satisfied that this debt relates purely to the time that the wife was in the Property A after the relationship ended. I will deduct the cost of this debt from the funds that are in the Aughtersons’ trust account before the remaining proceedings are divided between the parties in the percentages that I order.
The wife also says that there is a debt to (omitted water service) for $2,415.56. Annexure 11 of the wife’s affidavit affirmed 28 September 2017 is a letter addressed to the husband from (omitted water service) titled “Outstanding Account” and identifies it for being for the Property A. The annexure also includes a final notice addressed to the husband for the amount of $2,415.56. Although neither party raised this debt during the course of the hearing, I find that it is likely that the debt occurred during times that either or both of the parties were living in the Property A. I will also deduct the cost of this debt from the funds that are in the Aughtersons’ trust account.
There are several more debts the wife seeks to include in the property pool. They include the following:
a)a debt to (omitted debiting company) for $342.38. Annexure 10 of her affidavit affirmed 28 September 17 is a letter saying that the debt has been referred to (Debt Collectors B) but does not identify any details as to when or what this debt involves;
b)a debt to (omitted gas company) of $176.83. The wife says that this is for an overdue gas bill. Annexure 12 to the wife’s affidavit affirmed 28 September 2017 is a letter from (Debt Collectors A) to the wife saying that they intend to list the debt with a credit bureau. There are no further details about the debt including when it was incurred;
c)a debt to (omitted government department) for $22,525.50. Annexure 14 to the wife’s affidavit sworn 28 September 2017 is a Notice of Outstanding Matters for the Magistrates’ Court of Victoria dated 20 September 2017. It includes a large amount of offences that relate to toll offences, failure to vote, traffic camera offences, and drug offences that occurred from late 2012 to current. The wife says that these debts relate to the period that the parties were in a relationship. These are all post the end of relationship.
d)a debt to Centrelink for $13,789.13. The wife says that this debt was incurred as the husband “dobbed” her into Centrelink and said they were in a relationship, while she says that they were separated under the one roof. The husband was not cross-examined about this. I am not satisfied that this is a debt of the relationship.
e)a debt to (Debt Collectors C) for an unpaid (omitted telecommunications company) debt of $2,597.21. Annexure 04 to the wife’s affidavit affirmed 14 March 2018 is a settlement offer from (Debt Collectors C) with regards to this debt. It does not contain details about the time period in which this debt was accumulated, nor does it even include the telephone number to which this debt relates.
The state of the evidence with respect to these debts is such that I cannot be satisfied that they are debts of the relationship which should be included in the pool.
The asset pool
| Assets | ownership | $ |
| Proceeds of Sale from Property A | Joint | $71,344.21 |
| Total Assets | $71,344.21 | |
| Liabilities | ||
| (omitted water service) | Joint | $2,415.56 |
| (Debt Collectors A) – (omitted energy company) Debt | Joint | $6,781.72 |
| Total Liabilities | $9,197.28 | |
| Net assets | $62,146.93 | |
| Superannuation | ||
| Wife’s Superannuation | $600 | |
| Husband’s Superannuation | E$25,000 | |
| Total Superannuation | E$25,600 |
The wife seeks a splitting order from the husband’s superannuation of $25,000. She annexes a letter from (wife's superannuation company) which indicates that they can implement the proposed splitting order “providing the member has enough funds in their account.” On the evidence I have available it is likely that $25,000 is all the superannuation the husband has after withdrawing $28,000 to pay the mortgage arrears.
In her case outline the wife estimates the husband’s superannuation at $25,000. She gives no explanation as to why it is just and equitable for her to receive 100% of the husband’s superannuation.
The reliability of the parties
I found the wife to be a very unreliable witness in both her affidavit evidence and during cross examination. The husband directed the wife to her affidavit sworn 14 April 2015 where at [5] she said “We were never separated for longer than 12 months during any period of our relationship” and then to her most recent affidavit sworn 14 March 2018 where at [6] she said “We separated in late 2006, but reconciled in 2009…” The wife was not able to explain the inconsistencies in the evidence.
The husband was a more reliable witness.
Conduct of the proceedings
The conduct of these proceedings was disappointing from start to finish.
There is no doubt that the husband’s inconsistency in engaging in the proceedings and failure to comply with orders also contributed to the delay in these proceedings being finalised, but I am most concerned about the poor preparation and conduct of this matter. The wife’s lawyers repeatedly filed documents late. Much of the trail affidavit filed by the wife filed contains inadmissible material including non-particularised allegations, opinions and conclusions. The husband’s affidavit suffers from the same issues, however he prepared it without the assistance of a lawyer.
As mentioned at [13] – [16], Ms Rothschild filed multiple applications in a case during this proceeding. Each time an application in a case is filed the Court registry charges a filing fee of $115.00, unless a party is given an exemption. An amended application does not attract a filing fee.
Despite filing directions in the Orders made 3 November 2016 requiring that parties file one trial affidavit that they seek to rely upon at the final hearing, the wife’s case outline filed 1 November 2017 sought to rely upon no less than seven affidavits. Much of these were irrelevant to the substantive issues as they related to the costs issue.
The continually poor preparation was evidenced by the orders I made on 8 November 2017. The affidavit Ms Rothschild prepared for the wife filed on 24 October 2017 improperly annexed previous affidavits and orders. The affidavit was bound and had many annexures but did not contain sufficient evidence for me to be satisfied that based on the wife’s evidence a just and equitable outcome could be determined. Due to these deficiencies in the evidence I was forced to adjourn the hearing.
Ms Rothschild also prepared a third affidavit by her client which again raised the costs issue complaining that the order for interest had not been complied with. It is concerning that so many documents were filed about this issue. It should have been addressed properly in the first instance.
The self-represented husband was better prepared for cross examination than the wife’s representative, Mr Rothschild, who appeared for Ms Rothschild. He had to be frequently reminded as to the correct conduct of proceedings and that parenting matters were not on foot.
A major issue in dispute was the length of the parties’ relationship, including the length of periods of separation and when the relationship finally ended.
The husband’s amended response filed 3 November 2016 put the end date of the relationship in issue as he stated the wife’s application was filed out of time. Despite this being filed more than a year ago, the wife’s material was poorly prepared on this point and Mr Rothschild was unaware of this being in issue and told the Court he was being taken by surprise.
The pool is small. It primarily consists of moneys held in trust from the proceeds of sale of the property and the husband’s superannuation. Both parties have significant debts. The evidence as how these debts arose and whether they were relationship debts or not was most unsatisfactory. This is particularly concerning with respect to the wife’s debts given she has been legally represented by the same lawyer throughout the proceedings.
When there is a small asset pool it is even more important that lawyers focus on the forensic issues in dispute and conduct the case efficiently, not only for the benefit of their client, but also with regards to their duty to Court. Lawyers have a duty to the Court to run proceedings efficiently pursuant to rule 1.03 of the Federal Circuit Court Rules 2001.
One of the other concerning aspects of these proceedings is the unrealistic position taken by the wife. This would have been a real barrier to the matter resolving. Mr Rothschild struggled to justify that position at hearing.
Legal principles
Although parties disputed as to when the relationship ended, there is no dispute between the parties that they were in a de facto relationship of more than two years duration. Section 90SB(a) of the Family Law Act 1975 (Cth) (“Family Law Act”) is satisfied. Section 90SD being the geographical requirement is also satisfied.
Until the High Court decision in Stanford & Stanford (2012) 247 CLR 108, the position in respect of the process to be applied to the resolution of matrimonial property cases was said to be well settled with a preferred approach as set out by the Full Court in Hickey & Hickey & Attorney-General (Intervener) (2003) FLC 93-143 at 78,386 [39].
The High Court considered the operation of s.79 of the Act in the matter of Stanford. In this case, the majority stated at [35]-[36] that:
“It will be recalled that 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. The requirements of the two sub-sections are not to be conflated. In every case in which a property settlement order under s 79 is sought, it is necessary to satisfy the court that, in all the circumstances, it is just and equitable to make the order.”
The expression “just and equitable” is a qualitative description of a conclusion reached after examination of a range of potentially competing considerations. It does not admit of exhaustive definition. It is not possible to chart its metes and bounds.” [Footnotes omitted]
The High Court found three fundamental propositions with respect to the application of s.79, which can be summarised as follows:
1. Firstly, in order to ascertain whether it is just and equitable to make a property settlement order, it is necessary to identify the existing legal and equitable interests of the parties in the property. The High Court emphasised the word ‘existing’.
2. Secondly, although s.79 gives the court a broad power to make property settlement orders it may not be exercised in an unprincipled fashion. There must be no assumption that the parties’ interests are or should be different to their existing interests.
3. Thirdly, when considering whether making a property settlement order is just and equitable the court must not assume that one or the other party has the right to a property adjustment order. The court must give separate consideration to s.79(2) in addition to the matters referred to in s.79(4).
In Stanford the High Court indicated that, in the vast majority of matrimonial property cases, the requirements of s.79(2) will be readily satisfied, largely as a result of a consideration of the circumstances of the parties concerned, particularly the nature of their separation.
The High Court also pointed out that what is just and equitable is different in every case.
The principles referred to in Stanford & Stanford are equally applicable to de facto property matters: see Watson & Ling (2013) 49 Fam LR 303.
s75(2) factors
The husband is 33 and the wife is 31. The wife doesn’t refer to having any issues with her health. The husband says that he had a mental health breakdown at [26] of his affidavit and annexes a letter from Dr H at the (omitted medical centre) which says “The patient had 3 mental health management plans were done on 04/04/2012, 12/06/2013 and 21/02/2014”. Despite this, the husband does not have any admissible evidence on affidavit from treating medical professionals. If a party seeks to rely on medical evidence, the medical practitioner must be on affidavit and be prepared to be cross-examined if required. The father’s evidence is not sufficient for me to draw conclusions as to his mental health.
The husband has care of [X]. The wife sees her once a week, and she occasionally stays over with the wife.
Neither the wife, nor the husband, indicate whether the wife contributes financially to the child currently. Both parties rely on Centrelink benefits.
From the husband’s affidavit, there appears to have been a Protection Order in place at one point in time, but there is no information whether or not [X] remains subject to such an order. There are no parenting orders made by this Court.
The wife has another son, [C] born 2016, for whom she says she is the sole carer. She says she receives no child support for her son and that his father spends no time with him.
The husband does not mention having legal responsibility for any other person. The wife alleges that the husband has re-partnered with his neighbour, Ms A and that he lives part time with her. She provides no evidence of this but merely makes the assertion. I am not satisfied that this is the case.
Annexure 12 to the husband’s affidavit is an undated letter from a Mr S who says he employs the husband as a (occupation omitted) and that the husband has not been able to do the same amount of hours per day because he was made primary carer of his daughter around the end of April 2014. The same annexure includes an Employment Separation Certificate which states that the husband ceased employment with Mr S on 13 February 2016.
The husband has obtained employment in the past, has a higher earning capacity than the wife, and has a history of obtaining work. Furthermore, [X] is now 12. In the absence of admissible evidence about the husband’s mental health, I find that there is no evidence as to why the husband could not be working.
The wife says she is currently unemployed and the sole carer for a nearly 2 year old child. She says that she is currently reliant on Centrelink benefits. I find that the wife is currently unable to work, but that there is no evidence that she will be unable to work once her youngest child begins school.
The separate debts to which the parties depose total more than what is available from the proceeds of sale.
Conclusions
Mr Rothschild’s closing submissions were unhelpful. He said the parties were in an on/off relationship for 10 years. That submission was not supported by the wife’s own evidence. This is yet another example of the poor preparation and advocacy of this matter. I refer to [50] and [51] above.
I do not accept the wife’s arguments that the husband is deliberately not trying to find work, nor am I satisfied that the husband is in any kind of de facto relationship with his neighbour.
Considering the totality of the evidence, I am satisfied that the husband made much greater financial contributions during the relationship. He also made a further significant financial contribution post separation by withdrawing a significant part of his superannuation.
The husband has been and will continue to be the primary carer of [X].
In a short relationship such as this the husband’s contributions during and post the relationship must be given significant weight.
I am satisfied that there should be a small 75(2) adjustment in the wife’s favour, as the husband has a greater earning capacity given his previous work experience. I do take into account the fact that father has primary care of [X]. The wife has full time care of her youngest child and also relies on Centrelink benefits. Both parties have significant debts. Considering all of the circumstances I find it is just and equitable for the wife to receive a small adjustment in her favour for these factors.
Considering all of these factors I will make orders which will have the following effect:
a)After the payment of the (omitted energy company) debt and the (omitted water service) debt the remaining sum will be divided as to 75% to the husband and 25% to the wife, subject to the costs the husband was ordered to pay to the wife should be treated as a part payment of the husband’s 75% entitlement. If this is not done then the wife effectively pays for a significant part of that costs order herself which would defeat the purpose of the costs order;
b)The parties will keep their cars, furniture and personal belongings, money in their bank accounts and will be responsible for the debts in their names which are not otherwise paid from the money held in trust in accordance with these orders; and
c)I am not satisfied that it would be just and equitable to make any splitting order of the husband’s superannuation. At best the husband has $25,000 of his superannuation remaining after the withdrawal of $28,000 to reduce mortgage arrears. I do not know what superannuation he earned during the relationship and what was earned before and after the relationship. .
I am satisfied that this outcome is just and equitable.
I certify that the preceding one hundred and fourteen (114) paragraphs are a true copy of the reasons for judgment of Judge Harland
Date: 10 May 2018
Key Legal Topics
Areas of Law
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Family Law
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Civil Procedure
Legal Concepts
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Costs
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Limitation Periods
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Procedural Fairness
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Remedies
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