Roberts & Roberts

[2011] FamCA 650

FAMILY COURT OF AUSTRALIA

ROBERTS & ROBERTS [2011] FamCA 650

FAMILY LAW – SPOUSAL MAINTENANCE – Applications to enforce, vary or discharge interim spousal maintenance orders and arrears – Where parties’ circumstances changed – Whether changed circumstances amount to just cause - Just cause not established - Where wife established continuing maintenance needs – Where husband claimed he lacked capacity to pay - Where wife’s reasonable weekly needs quantified at an amount below when original order made - Where husband found to have capacity to pay – Decrease in periodic sum ordered

FAMILY LAW – ENFORCEMENT – Arrears to be paid by instalment

Family Law Act 1975 (Cth) s 43, s72, s75, s81, s83, s111AA

Lutzke & Lutzke (1979) FLC 90-714
Vakil v Vakil (1997) FLC 92-743
Wreford & Caley (2010) 43 Fam LR 1

APPLICANT: Ms Roberts

RESPONDENT: Mr Roberts

FILE NUMBER: SYC 4085 of 2009

DATE DELIVERED: 17 August 2011

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Ryan J

HEARING DATE: 19 July 2011

REPRESENTATION

ADVOCATE FOR THE APPLICANT: Konstan Lawyers

COUNSEL FOR THE APPLICANT: Mr Mater

COUNSEL FOR THE RESPONDENT: Mr Schonell SC

SOLICITOR FOR THE RESPONDENT: Karras Partners

Orders

1. Pending further order, as and from 28 February 2011, Order 1 made in these proceedings on 6 October 2009 is varied so that the amount of interim spousal maintenance payable by the respondent to the applicant is reduced to $853.00 per week.

2. It is declared that the arrears outstanding in relation to Order 1 made in these proceedings on 6 October 2009 (and as varied by Order 1 of these orders) are $20,472.00.

3. Pending further order, the respondent shall pay the arrears declared above to the applicant at the rate of $400.00 per week.  Payments pursuant to this order shall be made weekly and as directed in writing by the applicant.

4. Pending further order, the applicant and respondent shall jointly apply to a lending authority nominated by the respondent to advance $165,000.00 for the applicant’s use.  In this regard, $150,000.00 is to be released to the applicant and the balance remaining to be applied to interest due in relation to the advance.

5. The parties shall secure the advance referred to in Order 4 above upon a property owned by them at C Street, Suburb B.

6. All outstanding interim applications are dismissed.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 4085 of 2009

Ms Roberts

Applicant

And

Mr Roberts

Respondent

REASONS FOR JUDGMENT

1. These are proceedings to discharge; in the alternative to vary; or enforce an interim spousal maintenance order made pursuant to the Family Law Act 1975 (Cth) (“the Act”).

2. Ms Roberts (“the applicant”) commenced proceedings under the Act by her application filed 10 July 2009 for spousal maintenance and property settlement. Interim orders made on 6 October 2009 (“the orders”) required Mr Roberts (“the respondent”) to pay her interim spousal maintenance in the amount of $1,680.00 per week. This is the order under consideration.

3. These proceedings were commenced by the applicant with her Application in a Case filed on 27 April 2011.  Essentially she sought enforcement warrants in relation to commercial and personal property under the respondent’s control and disclosure orders.  Her application was amended and ultimately she sought payment of a lump sum (arrears) and about $185,000.00 to meet legal expenses.

4. There is no dispute that since 14 February 2011 (other than one $850.00 payment), the respondent has failed to comply with the interim spousal maintenance order.  It is also agreed that at the date of the hearing $31,944.00 was outstanding. 

5. The respondent filed his response on 2 June 2011 seeking that the order for interim spousal maintenance and arrears are discharged.  As to the arrears, in the alternative to their being discharged, he proposed that this issue be adjourned to the final hearing which will take place in 2012.  In relation to the applicant’s claim for legal expenses, the respondent proposed the parties obtain an advance which the applicant could utilise for legal expenses.  In this respect, the only issue was against which property the advance would be secured.

6. There is no doubt the parties circumstances have changed since the orders were made.  The key questions are whether these comprise just cause to discharge the orders and arrears or warrant reduction to the periodic payment. 

Background facts

1. The nature of interim hearings means that at this stage the Court is unable to determine contentious matters.  By way of background it would appear the following, unless otherwise identified, are generally uncontentious.

2. The applicant is 55 and the respondent is 61.

3. In 1997 the parties started to live together at which time the applicant moved into the respondent’s home at D Street, Suburb G (“Suburb G”).

4. At about the same time the applicant commenced part time work in a clerical position in the respondent’s professional practice. 

5. When the parties commenced cohabitation the applicant owned, inter alia, a property at A Street, Suburb E (“Suburb E”).

6. In July 1997 the respondent incorporated the professional practice.  From then until the parties separated the applicant was employed full time in the practice.  Thus it is about 14 years since the applicant was employed by a third party.

7. Later that year, the applicant purchased a property at W Street, Suburb B (“W Street”) from the respondent; which he owned at cohabitation; for $240,000.00.  It appears that the sale proceeds were invested in the professional practice.

8. The parties married in January 2000.

9. In 2000, the parties purchased the property at S Street, Suburb B (“S Street”) for either $816,000.00 or $853,000.00 (including GST).  The purchase price was made up from a St George Bank loan of about $570,000.00 and a draw down on W Street with the source of the remainder being contentious.  The practice operates from these premises for which rent is paid.

10. In 2002, using borrowed money, the parties purchased land at F Street, Gold Coast Suburb R (“Suburb R”) for $165,000.00 and spent $280,000.00 to build a home that has been tenanted ever since.

11. In 2003, the applicant sold W Street from which she applied the $115,000.00 surplus to matrimonial purposes.

12. That same year she sold Suburb E for $385,000.00 in relation to which the disposition of the $200,000.00 surplus is to an extent contentious.

13. In 2004, the parties purchased an investment property at C Street, Suburb B (“C Street”) for $735,000.00 plus GST; funded by a loan from National Australia Bank (NAB) for $587,000.00 with the balance derived from the W Street and Suburb E sales.

14. The parties purchased a property at H Street, Gold Coast Suburb T (“Suburb T”) in 2006 for $1,000,000.00 which was financed by a loan from Westpac for $808,000.00, $25,000.00 from joint funds and the balance by remortgaging Suburb R.

15. In March 2009 the parties separated.  Although separated they continued to live at Suburb G.

16. In April 2009, the respondent terminated the applicant’s employment.  According to her, from the practice she earned about $142,000.00 annually compared to the respondent’s $261,000.00.

17. The applicant vacated Suburb G in July 2009 following which she temporarily resided with friends.

18. As was mentioned earlier, the applicant commenced proceedings in this court on 10 July 2009.  In her affidavit filed the same day in support of an application for interim spousal maintenance, she said she planned to move to the Gold Coast in relation to which rental accommodation was estimated to be $2,500.00 – $3,000.00 per month including utilities.  In the alternative, she wanted to live in Suburb R.  It was on the basis she would rent that the orders were made and, I infer, the quantum required calculated. 

19. The orders are set out below:

    1.That until further order pursuant to Section 74 of the Family Law Act the Respondent Husband pay to the Applicant Wife by way of spouse maintenance the sum of $1,380.00 per week increasing to $1,680.00 per week forthwith upon the wife advising the husband through his solicitors that she is able to drive a motor vehicle following her operation.

    2.That until further order, orders are made in terms of paragraphs 3 and 4 of the Interim Orders sought by the wife in her Initiating Application filed 10 July 2009 as set out hereunder:

“3.    The spouse maintenance referred to in Order 1 shall be paid into the Commonwealth Bank account standing in the name of [the applicant] being account number [deleted] or as otherwise directed in writing by the Applicant Wife.

4.     The payment of maintenance referred to in Order 1 herein is to be made on every Monday of each week or as otherwise ordered by the Court.”

3.That by consent orders be made in terms of paragraphs 10, 11 and 12 of that application as set out hereunder:

10.   That the Husband and the Wife forthwith do all things and sign all documents necessary to cause the property situate at and known as [C Street, Suburb B] (the Property) to be sold by private treaty at the earliest possible date at a price to be agreed between the parties and failing such Agreement at a price to be determined by the President of the Real Estate Institute of NSW (or any successor of it) or his/her nominee and to disburse the proceeds of sale in the following manner and priority:

10.1payment of Agents Commission and advertising expenses and legal expenses of the sale;

10.2   payment of costs incurred, if any, in relation to the determination of value or selling price by the President of the Real Estate Institute of NSW or his/her nominee;

10.3   the balance of proceeds of sale remaining are to be deposited into a controlled money account in the name of Konstan Lawyers as Trustee for [the parties] pending further order of the Court.

11.  That in the event the Property is not sold by private treaty within a period of twelve (12) weeks from the date of these Orders, then the parties forthwith do all acts and things necessary including executing all documents necessary to cause the property to be sold by Public Auction at the earliest possible date at a reserve price to be agreed upon between the parties and failing such Agreement at a reserved price to be determined by the President of the Real Estate Institute of NSW (or any successor of it) or his/her nominee and to disburse the proceeds of the said sale in accordance with Order 9.

12.  The parties forthwith do all acts and things and sign all documents necessary to cause a Real Estate Agent to be appointed as the selling Agent for the Property.  In the event an Agent cannot be appointed by Agreement the Agent is to be determined by the President of the Real Estate Institute of NSW (or any successor of it) or his/her nominee, provided that the Agent is not an acquaintance of either the Husband or the Wife.”

4.That the solicitor having the carriage of that sale be a solicitor agreed between the parties within seven (7) days or the nominee of the President of the NSW Law Society.

5.That forthwith upon the delivery to her accommodation, at the cost of the husband, of the parties’ Maytag refrigerator, a Sony sound system and Loewe TV all in working order, the wife cause the Liebherr refrigerator in her possession to be delivered at the husband’s direction and at the cost of the wife.

6.That not later than 30 October 2009 or such other date as is agreed between the parties, the wife facilitate the collection by the husband of the […] Porsche […] motor vehicle in her possession.

7.That hereafter the husband meets the hire purchase payments in respect of that vehicle and indemnify the wife in relation to those payments.

8.By consent the husband pay to the wife any surplus recovered on the sale of the Porsche motor vehicle driven by the wife and that payment is to be made within seven (7) days of that sale.

9.That the husband be appointed trustee for sale of the wife’s motor vehicle and that the parties sign all documents and do all things necessary to give effect to this order.

10.Leave to the parties to apply in relation to these orders on giving seven (7) days’ notice to the Court and to the other party.

1. Orders 6, 7, 8 and 9 above were discharged by agreement; the effect of which is that each party continues to drive his or her Porsche.  Despite their best endeavours, C Street has not sold.  Thus, the respondent continues to meet significant ($8,600.00) monthly mortgage payments.  It is likely he has done so for longer than was anticipated when the orders were made.

The Application to discharge the Maintenance orders

1. As the outcome will influence the applicant’s enforcement application it is appropriate to consider first the respondent’s application that the orders and arrears be discharged. 

2. In relation to the modification of spousal maintenance orders (which includes discharge retrospectively to such date as the Court considers appropriate), s 83 of the Act is the governing provision. Section 83 is set out below:

   (1)  If there is in force an order (whether made before or after the commencement of this Act) with respect to the maintenance of a party to a marriage:

   (a)  made by the court; or

   (b)  made by another court and registered in the first mentioned court in accordance with the applicable Rules of Court;

   the court may, subject to section 111AA:

   (c)  discharge the order if there is any just cause for so doing;

   (d)  suspend its operation wholly or in part and either until further order or until a fixed time or the happening of some future event;

   (e)  revive wholly or in part an order suspended under paragraph (d); or

   (f)  subject to subsection (2), vary the order so as to increase or decrease any amount ordered to be paid or in any other manner.

   (1A)  The court’s jurisdiction under subsection (1) may be exercised:

   (a)  in any case in proceedings with respect to the maintenance of a party to the marriage; or

   (b)  if there is a bankrupt party to the marriage on the application of the bankruptcy trustee; or

   (c)  if a party to the marriage is a debtor subject to a personal insolvency agreement on the application of the trustee of the agreement.

   (2)  The court shall not make an order increasing or decreasing an amount ordered to be paid by an order unless it is satisfied:

   (a)  that, since the order was made or last varied:

   (i)  the circumstances of a person for whose benefit the order was made have so changed (including the person entering into a stable and continuing de facto relationship);

   (ii)  the circumstances of the person liable to make payments under the order have so changed; or

   (iii)  in the case of an order that operates in favour of, or is binding on, a legal personal representative the circumstances of the estate are such;

   as to justify its so doing;

   (b)  that, since the order was made, or last varied, the cost of living has changed to such an extent as to justify its so doing;

   (ba) in a case where the order was made by consent that the amount ordered to be paid is not proper or adequate;

   (c)  that material facts were withheld from the court that made the order or from a court that varied the order or material evidence previously given before such a court was false.

   (3)  Subsection (2) does not prevent the court from making an order varying an order made before the date of commencement of this Act if the first mentioned order is made for the purpose of giving effect to this Part.

   (4)  In satisfying itself for the purposes of paragraph (2)(b), the court shall have regard to any changes that have occurred in the Consumer Price Index published by the Australian Statistician.

   (5)  The court shall not, in considering the variation of an order, have regard to a change in the cost of living unless at least 12 months have elapsed since the order was made or was last varied having regard to a change in the cost of living.

   (5A)  In satisfying itself for the purposes of paragraph (2)(ba), the court shall have regard to any payments, and any transfer or settlement of property, previously made by a party to the marriage, or by the bankruptcy trustee of a party to the marriage, to:

   (a)  the other party; or

   (b)  any other person for the benefit of the other party.

   (6)  An order decreasing the amount of a periodic sum payable under an order or discharging an order may be expressed to be retrospective to such date as the court considers appropriate.

   (6A)  Where, as provided by subsection (6), an order decreasing the amount of a periodic sum payable under an order is expressed to be retrospective to a specified date, any moneys paid under the second mentioned order since the specified date, being moneys that would not have been required to be paid under the second mentioned order as varied by the first mentioned order, may be recovered in a court having jurisdiction under this Act.

   (6B) Where, as provided by subsection (6), an order discharging an order is expressed to be retrospective to a specified date, any moneys paid under the second‑mentioned order since the specified date may be recovered in a court having jurisdiction under this Act.

   (7)  For the purposes of this section, the court shall have regard to the provisions of sections 72 and 75.

   (8) The discharge of an order does not affect the recovery of arrears due under the order at the time as at which the discharge takes effect.

3. The approach to s 83 was considered in Wreford & Caley (2010) 43 Fam LR 1 and Vakil v Vakil (1997) FLC 92-743 where the Full Court considered “just cause” in the context of an application to discharge arrears of spousal maintenance. Their Honours in Vakil and Wreford & Caley agreed with Lindenmayer J in Lutzke & Lutzke (1979) FLC 90-714 that the words “just cause” must be interpreted in the context of the Act as a whole “and in particular with regard to the other specific provisions of the Act which relate to maintenance”. Thus, a “cause” for the discharge of a maintenance order will be a “just cause” only if, having regard to the other provisions of the Act, particularly those relating to maintenance, it can be said that it is “right” or “proper” that the order should be discharged.

4. In relation to spousal maintenance, their Honours in Wreford & Caley agreed with Vakil that in deciding whether there is just cause to discharge an order of this type the Court would consider, inter alia:

   ·    the right of a spouse to maintenance (s 72);

   ·    the matters to be taken into account in relation to spousal maintenance (s 75);

   ·    the duty of the Court to end financial relations (s 81); and

   ·    the need to preserve and protect the institution of marriage as the union of a man and a woman to the exclusion of all others voluntarily entered into for life (s 43(a)).

5. Before I discuss the parties’ respective cases, it is appropriate to record that in relation to each it was suggested there was a failure to fulfil his or her disclosure obligations.  While I agree it is difficult to reconcile aspects of their evidence, in a tight time frame each provided a significant volume of material and seemed to have done their best to meet their obligations.  That there were errors or omissions, without knowing more, does not persuade me there has been a failure to give appropriate disclosure.

6. The respondent relies upon what is said to be his difficult financial situation since the orders were made; the applicant’s improved circumstances and her allegedly undisclosed income. Considered individually or collectively these are said to amount to just cause and warrant the favourable exercise of the Court’s discretion to discharge the orders and arrears.  

1. Turning first to the applicant’s circumstances.  There is no dispute that when the interim orders were made the applicant was unemployed.  She claimed (about which there is corroborative evidence) she was depressed and anxious, which according to her rendered her unable to pursue paid employment.  She said she intended to seek employment when advised this would be appropriate.  The respondent correctly pointed out there is no evidence that in the intervening period the applicant has attempted to find paid employment, which I infer she has not.  She has not repartnered and claims her prospects of employment are poor.  In the context of the health issues to which I have made reference, consideration must be given to her having moved interstate and  absence from the wider workforce for more than a decade.   In addition to her involvement in significant litigation, it is appropriate to proceed at this stage on the basis that her lack of employment is not unreasonable.

2. After the respondent ceased paying maintenance, without his consent, from 21 February 2011 the applicant diverted to herself $200 per week, that being, half the rental income from Suburb R.  The Suburb T tenants vacated that property on 1 October 2010.  Thereafter, the parties disagreed about the appropriate weekly rental and the property remained untenanted.  The applicant wanted the property rented at $700.00 whereas the respondent sought $650.00.  It was recommended by the managing agent that the property be advertised at the lower amount.  In any event, after the respondent stopped paying maintenance, the applicant relinquished the property she rented and, without the respondent’s consent, on 28 February 2011 she moved into Suburb T where she now resides. So that it is clear, this means that subsequent to the orders, the applicant has additional income (with the respondent’s income being reduced by the same amount) and no longer pays rent.

3. In May 2011 after her application for a Newstart Allowance was denied, the applicant accessed $50,000.00 (approximately half) held in her Colonial First State Investments Ltd superannuation fund. From this, $40,000.00 was paid to her solicitors. She sold personal effects for $4,500.00 and said she borrowed $25,000.00 from friends and family to meet day to day living expenses. In her affidavit affirmed on 27 April 2011, the applicant disclosed savings of less than $1,000.00 and credit card liabilities in excess of $10,000.00.

4. Senior counsel for the respondent submitted that the applicant’s evidence does not withstand scrutiny.  To some effect he analysed debts and expenses and, even with the borrowed funds taken into account, it appeared she either had undisclosed income or her evidence was internally inconsistent and thus did not provide an accurate picture of her current circumstances.  For example, in her affidavit affirmed on 27 April 2011, because she could not afford the lease she said the sale of her Porsche was pending. Yet the vehicle has been retained and the lease repayments paid.  Her borrowings from friends occurred at a time which prima facie meant that, but for $1,200.00 borrowed in late 2010 she has been without funds for a considerable period. In other words, her borrowed funds were exhausted long ago and thus she could not have the outgoings identified in her evidence.  However, given that the applicant has not had paid employment, and there is no doubt the respondent defaulted months ago, I am inclined to the view that nonetheless her necessary and reasonable expenses accord with the evidence given by her.  It follows that, even with these conundrums unanswered, the applicant demonstrated a need for spousal maintenance.  Essentially, this comprised the amount ordered in 2009 from which is deducted the $200.00 Suburb R rent and rental costs which she no longer meets.  Immediately before she moved into Suburb T, she said that its market rental was $700.00 per week. In this hearing, however, she said that it should be factored in at a lower figure.  I prefer the calculation pressed by counsel for the respondent and thus her weekly accommodation need is factored in at $630.00.  Thus, for so long as she lives at Suburb T and receives rental from Suburb R, I am satisfied she needs $853.00 per week towards her reasonable needs.

5. Turning then to the respondent’s circumstances.  As mentioned earlier, he is the Principal of a professional practice that operates from S Street.  There is no dispute that since separation he has had control over the majority of the parties’ assets and met the majority of their liabilities.  Recently he provided a practice overview to Mr I who is a remuneration expert.  It outlines that the business produces about $1.6 million in gross fees per annum, with the … division grossing in excess of $300,000.00 per annum. The respondent’s total remuneration is said to vary between $300,000.00 and $320,000.00 per annum which includes superannuation, GST and other benefits.  This does not include equity based rewards. According to his recent Financial Statement and taking into account all revenue streams, he earns $11,070.00 per week or annually $575,640.00 gross. To the remuneration expert the respondent explained that although the industry is seasonal, the business cycle is predictable. In this regard, the peak earning period is between July and September during which the respondent works approximately 70 hours per week with his staff employed on a double shift basis.  It follows that the respondent has just entered his annual peak income earning period.  Assessment of his earning capacity and/or financial circumstances based on the later quarters of the current financial year, indeed perhaps any financial year, would thus provide an artificially deflated picture. 

6. The respondent points to the approximate $1,079.00 per week increased mortgage repayments paid by him, default of the NAB mortgage and lack of income from Suburb T and Suburb R as evidence that his financial position is considerably worse than it was in 2009.  In total, he claims he is about $2,300.00 per week poorer than he was when the orders were made.  He points out that until this hearing, the applicant refused to agree to restructure their two remaining capital and interest mortgages to interest only facilities.  This is now agreed and will thus significantly reduce his mortgage payments.   

7. The respondent’s affidavit and Financial Statement would suggest he has no capacity to support the parties’ assets, meet his needs and contribute to the applicant’s support.  However comparison between his Financial Statement sworn on 12 August 2009 with that filed on 18 July 2011 reveals that notwithstanding the passage of two years there are a significantly high number of identical entries.  Indeed, in Part “N” which sets out average weekly expenses, every item except one is the same; with expenditure such as “bird care” at $50.00 per week for two birds perhaps high.  The respondent records evidence of unpaid utilities and a notice of default issued by the NAB bank for mortgage arrears that total $27,000.00.  By way of a private loan, funds were applied to rectify this situation; as a consequence the loan is no longer in default and he is on good terms with the lender bank.  As an aside, expenditure by him of $200.00 per week on clothing and shoes, in the circumstances, is not accepted as reasonable or necessary.

8. Setting aside the obvious variation due to Suburb R and the loss of 50 per cent of rent from Suburb T, his personal income has remained reasonably stable; including his superannuation contribution at $758.00 per week and $900.00 per week for his car lease.  His current Financial Statement makes no mention of the $50,000.00 he borrowed from his ex-wife mentioned in his earlier affidavit nor details the source of funds from which it was repaid.  Notwithstanding he has paid about $40,000.00 per annum into superannuation since his first Financial Statement; he says the value of his superannuation is unchanged.   

9. It is noteworthy that in his current Financial Statement, at Part “H” which addresses personal expenses paid for the benefit of others, the respondent answered “nil”.  Tendered in the applicant’s case are the respondent’s recent credit card statements. These identify supplementary card holders on his account, namely his ex-wife and two adult children.  They used these cards between July 2010 to July 2011 for travel and other discretionary expenditure.  Whilst incomplete, the credit cards indicate purchases made by his ex-wife of $4,701.36 and $3,149.73 by his adult children. Indeed, the statements illustrate the respondent charged his account for a holiday including airfares and accommodation totalling $8,975.05; complete with limousine hire to the value of $1,499.00.  In relation to his former wife and adult children, although the respondent may have felt a moral obligation to assist them, he had no legal obligation to do this and this expenditure is irrelevant to the assessment of his capacity to pay spousal maintenance.  That he chose to make these payments rather than comply with the orders or make good arrears is relevant to both the application to discharge and enforce the arrears.  Plainly, if his Financial Statement is accurate, he lacked the capacity to make these payments.  In short, I am satisfied the respondent would not have made these voluntary payments unless he was able to afford them without compromising his capacity to meet his necessary expenses, jeopardise his financial stability or pay spousal maintenance.    

10. Counsel for the applicant asserted that the respondent’s ATM withdrawals demonstrated a pattern of withdrawals (at least $20,000.00) from which the Court would infer significant expenditure by him gambling.  I agree there is a pattern of withdrawals from gaming venues and it is likely the respondent does gamble.  Whether this involves more that the $150.00 per week he spends on entertainment was not established.

Conclusion in relation to spousal maintenance

1. The values of the parties’ matrimonial assets and liabilities are not settled.  From a Balance Sheet provided on 11 July 2011 it appears they have assets in the vicinity of $5.3 million - $5.5 million, superannuation assets worth about $190,000.00 and liabilities between about $2.16 million and $2.257 million.  From the background facts, it is apparent that significant assets and liabilities were acquired during cohabitation and jointly.  Similarly, it would appear common ground that whilst the parties cohabited they worked in the professional practice which produced a good income and enabled them to enjoy a very comfortable lifestyle.  The standard of living which each, post separation, seeks to maintain would appear in all the circumstances to be reasonable.

2. There is no doubt that since the orders were made the respondent’s mortgage repayments significantly increased and the parties’ expectation that C Street would be sold has not been realised.  As to the latter, the effect of this is that the respondent has continued to pay $8,600.00 per month (which includes interest of approximately $2,000.00 per month) for longer than was anticipated.  In addition, from October 2010 Suburb T was no longer income producing.  While these matters weigh in favour of just cause to discharge, there are other factors which weigh more heavily against it.  These include the respondent’s discretionary expenditure in relation to his ex-wife and adult children, superannuation contributions, high level expenditure on clothes and shoes, car repayments at $900.00 per week, and him being able to apparently maintain the very comfortable standard of living which the parties enjoyed during cohabitation.

3. When the applicant’s right to spousal maintenance is taken into account along with her need for it, the respondent has not established a just cause for the discharge of the order and arrears.

4. He has, however, established changes to his and the applicant’s circumstances which justify a decrease in the amount ordered to be paid.  From when the applicant moved into Suburb T her circumstances materially improved as a consequence of her taking rent for Suburb R and no longer paying rent.  From that later time, it is appropriate that the order is varied to require the respondent to pay $853.00 per week in lieu of the larger sum ordered in 2009.  While this may require the respondent to adjust the manner in which he manages his income and expenditure I am satisfied he has the capacity to do so without occasioning him hardship.

Application for Arrears

1. The Court has a discretion, not only as to the period in respect of which accumulated arrears of maintenance will be enforced, but as to whether they should be enforced at all. 

2. Although the parties agreed on the quantum of arrears, this calculation was undertaken by reference to the 2009 orders.  Because the amount payable is to be decreased from the end of February 2011 the arrears will be less than the agreed amount.  Calculated from 28 February 2011, at $853.00 per week, the arrears are $20,472.00. 

3. The respondent argued that the issue of arrears should await the final hearing.  Such an approach would be inconsistent with his obligations pursuant to the orders and s 72.  He is presently in a peak earning period and as a consequence of agreement that the two remaining principal and interest mortgages will be converted to interest only mortgages, I am satisfied he has the capacity to discharge the arrears by instalment.  Had the applicant not been obstructive in relation to the reletting of Suburb T and opposed his requests to convert the principal and interest loans to interest only loans, her argument in favour of a lump sum payment would have been stronger.  An order which would require the respondent to discharge the arrears at $400.00 per week does not result in an extravagant or disproportionate income for the applicant, nor is it likely to disrupt the respondent’s ability to maintain an appropriate standard of living.

Interim Costs/Lump Sum payment

1. The parties agree they will join in an application for a facility of $150,000 capital, plus a further amount ($15,000) to fund interest on that facility, for the applicants use.  Although this sum will be used at her discretion, almost all is required for legal expenses.  The issue is whether this advance should be secured against C Street or S Street.  There is considerable equity available in each property.

2. The respondent believes the NAB bank is likely to agree to convert its current facility to interest only and look favourably on this (additional advance) proposition regardless of his recent tenuous financial position.

3. The respondent, nominated S Street as the property which should be used as security.  This is because she says she may claim this asset in the property settlement.  With respect to the respondent, her position seemed to be little more than opposition for the sake of it.  I agree with the respondent that the better approach is to establish the facility with the lender and against the property most likely to agree.   For these reasons, I make the orders identified at the start of this judgment.

I certify that the preceding fifty two (52) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Ryan delivered on 17 August 2011.

Associate:                 

Date:    17 August 2011