Rogers and Rogers

FAMILY COURT OF AUSTRALIA

ROGERS & ROGERS

[2019] FamCA 700

FAMILY LAW – INTERIM PROPERTY – Where parties agree to the immediate sale for the former matrimonial home – Where the wife seeks a substantial interim property settlement – Where the financial positions of the parties are in stark contrast – Where the wife is in a less advantageous position than the husband – Where it is just and equitable for the wife to receive a partial property settlement of $2,000,000 following the sale of the former matrimonial home – Where both parties are to redraw on the mortgage the sum of $100,000 to be distributed evenly between them immediately, with such payment to be partial property settlement.

Family Law Act 1975 (Cth) s 72.
Family Law Rules 2004 r 19.04

Strahan and Strahan (2009) FLC 93-466

APPLICANT:

Mr Rogers

RESPONDENT:

Ms Rogers

FILE NUMBER:

SYC

7085

2018

DATE DELIVERED:

23 September 2019

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Stevenson J

HEARING DATE:

23 August 2019

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr O'Brien

SOLICITORS FOR THE APPLICANT:

Branston Neville Lawyers

SOLICITOR FOR THE RESPONDENT:

Ms Meredith

SOLICITORS FOR THE RESPONDENT:

Gayle Meredith & Associates

Orders

The husband and the wife do all acts and sign all documents necessary to cause the property situated at and known as B Street, C Town, NSW ("the C Town property") Folio Identifier …, to be listed for sale on a date as advised by the agent referred to in Order 1.1 herein and thereafter do all acts and execute all documents necessary to cause completion of any such sale on the following basis:
1.1.the C Town property is listed for sale with Mr P of R Real Estate ("the agent"
1.2.the parties appoint Ms Q of O Lawyers as solicitor to act on the sale ("the solicitor")
1.3.the C Town property is listed for sale by public auction on a date agreed by the parties or as advised by the agent with a reserve price of $5,500,000 unless otherwise agreed by the parties no less than 10 days prior to the date for auction
1.4.in the event the agent and/or the solicitor require funds in advance for marketing, advertising and other disbursements the husband will make such payments and be reimbursed upon completion of sale
1.5.prior to the property being listed for sale, and as soon as possible, the parties seek the advice of the agent as to the repair and maintenance work to be undertaken so as best to present the property for sale and thereafter the husband forthwith undertake and/or arrange and pay for such work
1.6.in the event the property fails to sell at the auction, the parties cause the property to be listed for sale by private treaty at an agreed price and failing agreement at the market value of the property as assessed by the agent plus 10%
1.7.the wife has the right to reside in the C Town property until completion of the sale.
On completion of the sale of the C Town property the husband and the wife do all acts and execute all documents necessary to cause the proceeds of sale to be paid as follows:
2.1.in payment of all agent's commission and disbursements, auctioneers fees and the solicitors costs and disbursements referrable to the sale
2.2.by way of adjustment of water rates and council rates
2.3.payment of such sums as required to discharge the mortgage securing the Westpac loan account ending #...96 in the names of the husband and wife
2.4.in payment to the wife of an amount of $2,000,000 by way of interim or partial property settlement, such sum to be paid directly to a bank account nominated by the wife
2.5.in reimbursement to the husband of any payments made by him towards the marketing and advertising costs and disbursements in accordance with Order 1.4 herein and
2.6.in payment of the balance to a controlled monies account in the name of Gayle Meredith & Associates in trust for the husband and the wife and pending further order that no transactions be effected on the controlled monies account without the consent in writing of the husband and the wife through their respective solicitors.
The wife vacate the C Town property upon completion of the sale.
For the purpose of Order 1.5 herein, the husband give no less than 24 hours' notice to the wife of the proposed date and time he or tradesperson(s) which he may engage to attend the C Town property to undertake repair and maintenance work.
5.1 Pending completion of sale of the C Town property the husband continue to make payments in accordance with Order 2 made on 19 December 2018.
5.2Order 2 made on 19 December 2018 stands discharged on the date of receipt by the wife of the sum of $2,000,000 in accordance with Order 2.4 hereof.
6.1 Each of the parties forthwith do all things and execute all documents necessary to cause a redraw in the amount of $100,000 on the mortgage secured on the title to the C Town property as soon as possible and to distribute a sum of $50,000 to each of the husband and the wife.
6.2Such payments of $50,000 to each of the parties are characterised as interim or partial property settlements.

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 Rogers & Rogers 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 7085 of 2018

Mr Rogers

Applicant

And

Ms Rogers

Respondent

REASONS FOR JUDGMENT

The proceedings

On 19 December 2018 I made the following interim orders after a contested hearing:
IT IS ORDERED PENDING FURTHER ORDER
(1)1.1      Each of the parties forthwith do all things and execute all documents necessary to cause a redraw in the sum of $200,000 on the mortgage secured on the title to the property situate at B Street, C Town in the State of New South Wales ("the C Town property") and to distribute such amount of $200,000 as to $150,000 to the wife and the balance of $50,000 to the husband.
1.2Such payments of $150,000 to the wife and $50,000 to the husband are characterised as interim or partial property settlements.
(2)      The husband pay promptly:
2.1all amounts referable to loans secured on the title to the C Town property
2.2lease payments, registration, maintenance and insurance for Motor vehicle 1 registered number …
2.3all outgoings and maintenance due for the C Town property
2.4      private health insurance for each of the parties.
(3)The wife has sale and exclusive use of Motor vehicle 1 registered number … and she is solely responsible for all costs referable to tolls, petrol and fines in respect of such vehicle.
(4)The husband is responsible in the first instance for all professional costs and fees incurred by single experts to be retained to value the husband's interests in companies and trusts including but not limited to D Pty Ltd; E Pty Ltd; F Pty Ltd and G Pty Ltd.
(5)The competing applications of the parties for interim relief are otherwise adjourned to a duty list on 6 May 2019.
Pursuant to these Orders, the husband and the wife received $50,000 and $150,000 respectively in March 2019. As at 11 July 2019, the wife held liquid funds of $17,499. She deposed that she spent the balance of the sum of $150,000 on "my living expenses and my legal fees".
In his affidavit of 13 June 2019 the husband deposed:
43.I am concerned that the funds provided to my former wife due to the increase in the mortgage were to be used only for her personal living expenses. This was a clear instruction from Justice Stevenson and the judgement of 19 December 2018 that these monies provided to my former wife was not to fund her litigation.
I gave no such "instruction" in relation to the redraw funds distributed to the wife in my Judgment of 19 December 2018. In relation to the application of funds drawn down on the mortgage and distributed to each of the parties I said as follows:
16.I propose to make orders to the effect that the wife receive a sum of $150,000 and the husband the balance from these redraw funds. I will order that the parties receive these payments by way of interim or partial property settlement. The application of these funds will then be a matter within the discretion of each of the parties.
The husband deposed that he received $50,000 pursuant to the Orders of 19 December 2018 on 19 March 2019. He deposed further that he used these funds to pay a credit card debt of $22,000, to meet real estate valuation fees of $13,750 and to pay legal costs of $12,000.
On 20 June 2019 the husband filed an Application in a Case, whereby he sought the following orders:
1.        That leave be granted to serve short notice of this application.
2.        That this Application be listed as a matter of urgency.
3.        That time be abridged.
4.        Any Rule or Regulation not complied with be dispensed with.
5.        That Orders dated 19 December 2019 be vacated.
6.That within 7 days of the date of these Orders the parties will do all things and sign all document[s] to list for sale the property at B Street, C Town, New South Wales being the whole of the land comprised in title reference … and for that purpose the following shall apply:
6.1.The parties appoint J Real Estate as the agent to sell the property;
6.2.The parties shall give such instruction as necessary to K Lawyers to prepare the contract and act on the conveyance.
6.3.Upon sale, the sale proceeds of the property shall be paid in the following manner and priority:
6.3.1.To discharge the mortgage secured over the property in favour of the Westpac Banking Corporation;
6.3.2.Payment of the agent's commission and advertising or other expenses, if any, payable on the sale.
6.3.3.Payment of legal costs and disbursements relating to the sale of the property.
6.3.4. The net balance be paid as follows:
6.3.4.1.     50% to the wife;
6.3.4.2.     50% to the husband.
7.That if either party refuses or neglects to sign within fourteen (14) days of a written request to do so any documents necessary to put into effect the terms of the Orders, a Registrar of the Family Court of Australia or any other Court Officer appointed by the Court in his or her stead is hereby appointed pursuant to the provisions of section 106A of the Family Law Act 1975 (Commonwealth) to execute such documents on behalf of the defaulting party.
8.That the wife pay the husband's taxed costs of and incidental to this application.
On 11 July 2019 the wife filed a Response to Application in a Case, in which she sought the following orders:
1.That the husband's application sought in paragraph 5 of his Application in a Case filed 20 June 2019 ("the Application in a Case") be dismissed.
2.That the husband and the wife do all acts and sign all documents necessary to cause the property situated and known as B Street, C Town, NSW ("the C Town property") Folio Identifier …, registered in the names of the husband and the wife, to be listed for sale on 9 August 2019 or such other date as advised by the agent referred to in Order 2.1 herein and thereafter do all acts and execute all documents necessary to cause completion of any such sale on the following basis:
2.1.that the C Town property be listed for sale with Mr P of R Real Estate or in the alternative that the agent be appointed by a nominee of the President of the Real Estate Institute of New South Wales ("the agent"), the costs of obtaining the appointment to be paid by the husband, and in that event the President of the Real Estate Institute of New South Wales be informed the appointed agent is not to be J Real Estate;
2.2.that the parties appoint Ms Q of O Lawyers as solicitor to act on the sale or in the alternative, that the solicitor be appointed by a nominee of the President of the Law Society of New South Wales ("the solicitor"), the costs of obtaining the appointment to be paid by the husband, and in that event the President of the Law Society of New South Wales be informed the appointed solicitor is not to be K Lawyers;
2.3.that the C Town property listed for sale by public auction at a date as agreed and if there is no agreement as to the date on 21 September 2019, and the husband and the wife agree on the reserve price for the auction and in the event there is no agreement as to the reserve price 10 days before the auction, the reserve price be $6,000,000;
2.4.that in the event the agent and/or the solicitor require funds in advance for marketing, advertising and other disbursements in relation to the sale of the C Town property, that the husband make such payments as required by the agent and/or the solicitor, and that the husband be reimbursed for such payments upon completion of sale of the C Town property;
2.5.that prior to the C Town property being listed for sale and no later than 1 August 2019, the husband and the wife seek the advice of the agent as to the repair and maintenance work to be undertaken to the C Town property to best present the property for sale, and thereafter the husband forthwith undertake and/or pay for the repair and maintenance work stipulated by the agent, including but not limited to the following:
2.5.1.cleaning the exterior of the C Town property including the windows and fences;
2.5.2.repairing the lawns damaged by worm infestation;
2.5.3.gardening and landscaping including the hedges;
2.5.4.repairing the ceiling of the ensuite toilet attached to the wife's bedroom which was damaged by rain;
2.5.5.repairing the pipe leakage under the sink in the ensuite toilet attached to the fourth bedroom;
2.5.6.fixing the water feature located at the front of the property including replacing the pump;
2.5.7.repairing of if necessary replacing the Billi filtered water system;
2.5.8.repairing or if necessary replacing the dishwasher;
2.6.that the agent and the solicitor be instructed by the parties to seek the purchaser agree that the deposit payable on exchange of contracts be released to the wife forthwith upon exchange of contracts;
2.7.that each of the parties sign all documents required by the agent and the solicitor in order to effect the sale;
2.8.that in the event the property fails to sell at the auction the property be listed for sale by private treaty at the list price as agreed by the husband and the wife and failing agreement at the market value of the property as assessed by the agent plus 10%;
2.9.that subject to Order 5 herein that the wife have the right to reside in the C Town property until completion of the sale.
3.That in the event the purchaser of the C Town property agrees to release the deposit on exchange of contracts that the parties do all acts to instruct the agent to pay the deposit to the wife ("the C Town deposit") and that the nature of the payment be determined by the trial Judge.
4.That on completion of the sale of the C Town property the husband and the wife do all acts and execute all documents necessary to cause the proceeds of sale to be paid as follows:
4.1.in payment of all agent's commission and disbursements, auctioneers fees and the solicitors costs and disbursements referrable to the sale;
4.2. by way of adjustment of water rates and council rates;
4.3.payment of such sums as required to discharge the mortgage secured on the C Town property including the CBA loan account ending #...96 in the names of the husband and wife;
4.4.such sum required to discharge the lease relating to the motor vehicle driven by the wife registration number … ("the Motor vehicle 1");
4.5.the sum of $3,000,000 to the wife by way of interim property settlement, such sum to be paid directly to a bank account nominated by the wife;
4.6.in reimbursement to the husband of any payments made by him towards the marketing and advertising costs and disbursements in accordance with Order 2.4 herein; and
4.7.the balance to be deposited in a controlled monies account in the name of Gayle Meredith & Associates in trust for the husband and the wife and pending further order that no transactions be effected on the controlled monies account without the consent in writing of the husband and the wife through their respective solicitors.
5.That conditional upon the wife receiving the deposit received from the sale of the C Town property in accordance with Orders 2.6 and 3 herein that after the receipt of the deposit and no later than 2 weeks before the date for completion of sale of the C Town property, the wife vacate the C Town property and thereafter the wife through her solicitors provide written confirmation of her vacating the property to the husband through his solicitors, and in the event the wife does not receive the release of the deposit that she provide vacant possession on completion of the sale.
6.That for the purpose of Order 2.5 herein, the husband give no less than 24 hours' notice to the wife of the proposed date and time the tradesperson(s) engaged by the husband to attend the C Town property to undertake repair and maintenance work will attend the property.
7.That until such time as the wife receives the C Town deposit or the payment pursuant to Order 4.5 herein on completion of the sale of the C Town property that the husband pay to the wife the sum of $1,500 per week by way of spousal maintenance.
8.That in the event the wife does not receive the C Town deposit released to her pursuant to Orders 2.6 and 3 herein, that on 27 September 2019 the husband pay the wife $50,000, the nature of the payment to be determined by the trial Judge.
9.That pending completion of sale of the C Town property:
9.1.that the husband pay all mortgage repayments, council rates, water rates, building and contents insurance premiums, electricity, gas, home telephone and internet and the maintenance and repair costs referrable to the C Town property within 48 hours of the wife providing a copy of the tax invoices to him or he otherwise receiving them, and the husband provide written confirmation to the wife through their respective solicitors once payment has been made by him and within seven days of the payment;
9.2.that the husband cause to be paid the lease payments, registration, insurances and service and repairs referrable to the Motor vehicle 1.
10.That the parties have leave to provide a copy of these Orders to the agent and the solicitor acting on the sale of the C Town property.
11.That forthwith on the payment referred to in Order 4.4 herein the husband do all necessary (sic) to transfer to the wife the Motor vehicle 1free from encumbrance.
12.That liberty be granted to relist the matter on 10 days' notice to the Court and to the other party.
13.That in default of either or both of the husband and wife doing all such things and executing all such documents as may be needed to comply with these Orders that pursuant to Section 106A of the Family Law Act 1975 a Registrar of the Sydney Registry of the Family Court of Australia or such other person appointed by the Court shall be authorised to do all such acts and things and execute all such documents on behalf of either or both of the husband and the wife and order that in the event that either party procure compliance with the Orders set out hereof by obtaining execution of documents pursuant to this Order, then the party procuring such execution of documents shall be indemnified by the other for his or her costs and expenses incurred in obtaining such compliance.
14.That the husband pay the wife's costs.

These competing applications came before a Senior Registrar in a Duty List on 15 July 2019. The Senior Registrar referred the interim applications for allocation of a hearing date, noting that a similar order had been made in May 2019 in relation to a Contravention Application filed by the wife. These proceedings were listed before me for interim hearing on 23 August 2019. The wife discontinued her Contravention Application prior to 23 August 2019.
Without the leave of the court or notice to the wife and her solicitor, the husband filed an Amended Application in a Case on 20 August 2019. This application constituted a significant change in the husband's position, as he sought the following orders:
1.        That leave be granted to serve short notice of this application.
2.        That this Application be listed as a matter of urgency.
3.        That time be abridged.
4.        Any Rule or Regulations not complied with be dispensed with.
5.        That Orders dated 19 December 2019 (sic) be vacated.
6.That within 7 days of the date of these Orders the parties will do all things and sign all documents so as to drawdown the sum of $100,000 from the mortgage registered on the title of the property at B Street C Town.
7.That upon receipt of the sum drawdown from the mortgage pursuant to Order 6 the sum of $50,000 to be paid to each the Husband and the Wife.
8.Within 21 days of receipt of the $50,000 the wife shall vacate the property at B Street C Town.
9.That once the wife vacates the property at B Street C Town pursuant to Order 8 the Husband have the sole occupation of the said property.
10.That within 7 days of the date of these Orders the parties will do all things and sign all document[s] to list for sale the property at B Street, C Town, New South Wales being the whole of the land comprised in title reference … and for that purpose the following shall apply:
10.1The parties appoint J Real Estate and R Real Estate as the agents to sell the property;
10.2The parties shall give such instruction as necessary to ~~K Lawyers~~ Ms Q of O Lawyers to prepare the contract and act on the conveyance.
10.3Upon sale, the sale proceeds of the property shall be paid in the following manner and priority:
10.3.1.To discharge the mortgage secured over the property in favour of the Westpac Banking Corporation;
10.3.2.Payment of the agent's commission and advertising or other expenses, if any, payable on the sale.
10.3.3.Payment of legal costs and disbursements relating to the sale of the property.
10.3.4.The net balance be paid as follows:
10.3.4.1.1.     50% $50,000 to the wife;
10.3.4.1.2.50% $50,000 to the husband.
10.3.4.1.3.Balance to be invested in a Controlled Money account with Branston Neville Lawyers
11.That if either party refuses or neglects to sign within fourteen (14) days of a written request to do so any documents necessary to put into effect the terms of the Orders, a Registrar of the Family Court of Australia or any other Court Officer appointed by the Court in his or her stead is hereby appointed pursuant to the provisions of section 106A of the Family Law Act 1975 (Commonwealth) to execute such documents on behalf of the defaulting party.
12.That the wife pays the husband's taxed costs of and incidental to this application.
On the day of the interim hearing the wife's solicitor submitted a Minute of Orders Sought in the following terms:
1.That the husband's application sought in paragraph 5 of his Amended Application in a Case filed 20 August 2019 ("the Application in a Case") be dismissed.
2.That the husband and the wife do all acts and sign all documents necessary to cause the property situated and known as B Street, C Town, NSW ("the C Town property") Folio Identifier …, registered in the names of the husband and the wife, to be listed for sale on 9 September 2019 or such other date as advised by the agent referred to in Order 2.1 herein and thereafter do all acts and execute all documents necessary to cause completion of any such sale on the following basis:
2.1.that the C Town property be listed for sale with Mr P of R Real Estate ("the agent");
2.2.that the parties appoint Ms Q of O Lawyers as solicitor to act on the sale ("the solicitor");
2.3.that the C Town property be listed for sale by public auction at a date as agreed and if there is no agreement as to the date on 12 October 2019, and the husband and the wife agree on the reserve price for the auction and in the event there is no agreement as to the reserve price 10 days before the auction, the reserve price be $5,500,000;
2.4.that in the event the agent and/or the solicitor require funds in advance for marketing, advertising and other disbursements in relation to the sale of the C Town property, that the husband make such payments as required by the agent and/or the solicitor, and that the husband be reimbursed for such payments upon completion of sale of the C Town property;
2.5.that prior to the C Town property being listed for sale and no later than 4 September 2019, the husband and the wife seek the advice of the agent as to the repair and maintenance work to be undertaken to the C Town property to best present the property for sale, and thereafter the husband forthwith undertake and/or pay for the repair and maintenance work stipulated by the agent, including but not limited to the following:
2.5.1.cleaning the exterior of the C Town property including the windows and fences;
2.5.2.repairing the lawns damaged by worm infestation;
2.5.3.gardening and landscaping including the hedges;
2.5.4.repairing the ceiling of the ensuite toilet attached to the wife's bedroom which was damaged by rain;
2.5.5.repairing the pipe leakage under the sink in the ensuite toilet attached to the fourth bedroom;
2.5.6.fixing the water feature located at the front of the property including replacing the pump;
2.5.7.repairing the Billi filtered water system;
2.5.8.repairing the dishwasher;
2.6.that the agent and the solicitor be instructed by the parties to seek the purchaser agree that the deposit payable on exchange of contracts be released to the wife forthwith upon exchange of contracts;
2.7.that each of the parties sign all documents required by the agent and the solicitor in order to effect the sale;
2.8.that in the event the property fails to sell at the auction the property be listed for sale by private treaty at the list price as agreed by the husband and the wife and failing agreement at the market value of the property as assessed by the agent plus 10%;
2.9.that subject to Order 5 herein that the wife have the right to reside in the C Town property until completion of the sale.
3.That in the event the purchaser of the C Town property agrees to release the deposit on exchange of contracts that the parties do all acts to instruct the agent to pay the deposit to the wife ("the C Town deposit") and that the nature of the payment be determined by the trial Judge.
4.That on completion of the sale of the C Town property the husband and the wife do all acts and execute all documents necessary to cause the proceeds of sale to be paid as follows:
4.1.in payment of all agent's commission and disbursements, auctioneers fees and the solicitors costs and disbursements referrable to the sale;
4.2. by way of adjustment of water rates and council rates;
4.3.payment of such sums as required to discharge the mortgage secured on the C Town property securing the Westpac loan account ending #... 96 in the names of the husband and wife;
4.4.such sum required to discharge the lease relating to the Motor vehicle 1 driven by the wife and in the name of the husband, registration number … ("the Motor vehicle 1");
4.5.the sum of $3,000,000 (less any sum paid to her prior to completion from the deposit) to the wife by way of interim property settlement, such sum to be paid directly to a bank account nominated by the wife;
4.6.in reimbursement to the husband of any payments made by him towards the marketing and advertising costs and disbursements in accordance with Order 2.4 herein; and
4.7.the balance to be deposited in a controlled monies account in the name of Gayle Meredith & Associates in trust for the husband and the wife and pending further order that no transactions be effected on the controlled monies account without the consent in writing of the husband and the wife through their respective solicitors.
5.That conditional upon the wife receiving the deposit received from the sale of the C Town property in accordance with Orders 2.6 and 3 herein that after the receipt of the deposit and no later than 2 weeks before the date for completion of sale of the C Town property, the wife vacate the C Town property and thereafter the wife through her solicitors provide written confirmation of her vacating the property to the husband through his solicitors, and in the event the wife does not receive the release of the deposit that she provide vacant possession on completion of the sale.
6.That for the purpose of Order 2.5 herein, the husband give no less than 24 hours' notice to the wife of the proposed date and time he or the tradesperson(s) engaged by the husband to attend the C Town property to undertake repair and maintenance work will attend the property.
7.That until such time as the wife receives the C Town deposit or the payment pursuant to Order 4.5 herein on completion of the sale of the C Town property that the husband pay to the wife the sum of $1,500 per week by way of spousal maintenance directly into a bank account nominated by the wife.
8.That in the event the wife does not receive the C Town deposit released to her pursuant to Orders 2.6 and 3 herein, that on 13 October 2019 the husband pay the wife $50,000, the nature of the payment to be determined by the trial Judge.
9.That pending completion of sale of the C Town property:
9.1.that the husband pay all mortgage repayments, council rates, water rates, building and contents insurance premiums, electricity, gas, home telephone and internet and the maintenance and repair costs referrable to the C Town property within 48 hours of the wife providing a copy of the tax invoices to him or he otherwise receiving them, and the husband provide written confirmation to the wife through their respective solicitors once payment has been made by him and within seven days of the payment;
9.2.that the husband cause to be paid the lease payments, registration, insurances and service and repairs referrable to the Motor vehicle 1.
10.That the parties have leave to provide a copy of these Orders to the agent and the solicitor acting on the sale of the C Town property.
11.That forthwith on the payment referred to in Order 4.4 herein the husband do all necessary (sic) to transfer to the wife the Motor vehicle 1 free from encumbrance.
12.That liberty be granted to relist the matter on 10 days' notice to the Court and to the other party in relation to implementation of these orders.
13.That in default of either or both of the husband and wife doing all such things and executing all such documents as may be needed to comply with these Orders that pursuant to Section 106A of the Family Law Act 1975 a Registrar of the Sydney Registry of the Family Court of Australia or such other person appointed by the Court shall be authorised to do all such acts and things and execute all such documents on behalf of either or both of the husband and the wife and order that in the event that either party procure compliance with the Orders set out hereof by obtaining execution of documents pursuant to this Order, then the party procuring such execution of documents shall be indemnified by the other for his or her costs and expenses incurred in obtaining such compliance.
14.That the husband pay the wife's costs.
The parties agreed to engage the real estate agent and conveyancing solicitor proposed by the wife in her Minute. Otherwise, all of the above issues were at large in the interim hearing.

Background

A short history of the parties' relationship was set out in my Reasons for Judgment of 19 December 2018. Since that time the wife has occupied the former matrimonial home ("the C Town property") and the husband has lived in an apartment owned by his father, who is a resident of a nursing home. The husband deposed that he pays $100 per week and meets the outgoings in relation to this apartment.
The parties attended a mediation on 4 July 2019. Unfortunately, they reached no agreement and they will therefore face delay in finalisation of these proceedings.
On 20 May 2019 the wife's general practitioner, Dr S, referred her for admission to the T Hospital. She was admitted on 22 May 2019 and remained as an inpatient until 12 June 2019.
In his report of 21 October 2018 Dr S stated inter alia:
Recent health issues:
·Depression and anxiety
…
Diagnosis of her conditions:
·Depression and anxiety with some suicidal thoughts
Prognosis of expected health
I wouldn't expect her mental health to begin to significantly improve until the main contributing external factor (the breakdown of her marriage) is resolved finally.
In his report of 2 July 2019 Dr S wrote inter alia:
20 May 2019
(Admitted to T Hospital 22 May 2019 for 3 weeks for treatment severe anxiety/depression/stress…).
Dr S reported further on 2 July 2019:
"Her mood has been brittle and fragile with poor sleep for most of this year with some brief periods where she was more upbeat and somewhat hopeful.
She has periods of extreme demotivation. She reports extreme tiredness and lethargy along with insomnia. She has been consistently overwhelmed by small tasks such as taking a simple inventory of household items and constantly anxious about her finances and what the future may hold for her. She reports crying at home and in public multiple times/day.
She has reported suicidal ideation at times although not revealed a plan. She has described significant stress with minor events, displaying physical symptoms of anxiety such as heart racing and sweatiness and general fear, even going to a new shop to order coffee. Her most recent two consultations were extended as she was severely distressed and incapacitated by her feeling of stress and anxiety regarding her current situation.
The wife's psychologist, Ms R, provided reports dated 11 October 2018 and 30 April 2019. In her report of 11 October 2018 Ms R opined as follows:
CURRENT DIAGNOSIS
Major Depressive Disorder 296.33
Ms Rogers currently presents with symptoms consistent with a diagnosis of Major Depressive Disorder (recurrent, severe) as per DSMV criteria. Ms Rogers describes feeling sad, empty, hopeless and worthless most days. She has diminished interest or pleasure in activities that she used to enjoy. She is fatigued and without energy most days. Her ability to concentrate and make clear decisions has diminished. She has recurrent suicidal ideation without intent or a specific plan. These symptoms cause clinically significant distress and impairment in her daily functioning.
Generalised Anxiety Order 300.02
Ms Rogers currently presents with symptoms consistent with a diagnosis of Generalised Anxiety Order as per DSMV criteria. Ms Rogers is experiencing excessive anxiety and worry about a number of different things most days. She ruminates over past events, her health and uncertain future. She finds it difficult to control her worry. She reports perfectionistic traits, agitation, irritability, muscle tension and restless sleep. She is easily fatigued and finds it difficult to concentrate and attend to tasks. Her clinical symptoms impair her daily functioning.
In her report of 30 April 2019 Ms R stated inter alia:
As mentioned in my last report, Ms Rogers would benefit from the following:
1.        living independently from her husband
2.        financial independence
3.        ongoing psychological therapy and pharmacological treatment
4.        increasing her social support network
5.        staying behaviourally activated with regular exercise
6.        a timely and amicable settlement agreement.
The husband has also encountered difficulties with his health since the Orders of 19 December 2018. He deposed that he continues to suffer from anxiety and stress and sleeps for only approximately three hours per night. The husband indicated that he underwent surgery for decompression of nerves in his neck and shoulder on 11 July 2019. He deposed also that he injured his biceps muscle in the course of his employment in late June 2019 and may require more surgery.
The single expert forensic accountant, Mr H, completed a report on 3 July 2019 in relation to the entities:
·E Pty Limited
·D Pty Limited
·G Pty Limited
·F Pty Limited.
Mr H valued the husband's interest in these four entities at a total of $3,450,715. The husband and his brother Mr L Rogers hold equivalent numbers of ordinary shares in these companies.
The report of Mr H dated 3 July 2019 was unavailable to the husband at the time when he filed his Application in a Case on 20 June 2019. In his affidavit of 13 June 2019, however, the husband deposed as follows:
22.Mr H of H Valuers. was appointed as the joint valuer to value my business entities. Annexed and marked “D” is a copy of the valuation report dated 20 May 2019.
This valuation was not tendered in evidence, thus I am unable to compare the contents of these two reports. I would note that the husband attributed the following values to his corporate interests in a Financial Statement of 19 August 2019:
·E Pty Limited  $1,896,578
·D Pty Limited  $1,047,345
·G Pty Limited  $224,874
·F Pty Limited  $626,986
Total  $3,795,783
At the interim hearing on 23 August 2019 counsel for the husband indicated that he took issue with the discount rate applied by Mr H, in relation to his shareholding, in the report of 3 July 2019. In his Case Outline, counsel for the husband wrote as follows:
14.The obvious danger is the effective range of the discount which the single expert identifies as being common, namely 50%, compared to the discount which he applies of 7.5%. This has an enormous potential to vary the property pool, and a cautious approach is respectfully submitted to be appropriate so that neither party finds themselves compromised at final hearing due to the application of funds already made under interim property orders.
The husband deposed that he has experienced financial difficulty in meeting his obligations pursuant to the interim orders of 19 December 2018. He deposed further that he has negotiated with his brother that he receive funds in addition to his salary, so as to meet mortgage instalments and outgoings in relation to the former matrimonial home and car expenses for the wife.

Consideration

Immediate sale of the C Town property

Both parties sought orders for a sale of the C Town property without delay. The solicitor for the wife indicated that her consent was conditional upon her receiving $3 million from the net proceeds of sale. On the wife's proposal, the husband would receive no part of the net sale proceeds.
The husband sought orders to the effect that each of the parties receive a sum of $50,000 from the net sale proceeds, plus an additional $50,000 from an immediate redraw of $100,000 on the mortgage account. The husband sought a discharge of the orders that he pay private health insurance and gap medical expense, lease payments and maintenance costs in respect of the Motor vehicle 1 and the cost of a mobile telephone used by the wife.

The orders sought by the wife provided for a detailed regime for the sale of the C Town property and, in particular, fixed a reserve price for an auction. The single expert, Mr U, valued the property at $5,500,000 on 26 March 2019. I see merit in the submission on behalf of the wife, to the effect that the reserve price should be as agreed by the parties or otherwise a sum of $5,500,000.
I am unpersuaded that the wife should be required to vacate the property ahead of settlement of the sale. I am mindful of her fragile state of mental health and the absence of any convincing reason advanced on behalf of the husband as to why she should do so. The husband stated his reasons why the wife should be required to vacate the property ahead of settlement of the sale as follows:
12.... in order to present it in the best light, I would like to be able to move back in and undertake maintenance and upkeep. I would like [Ms Rogers] to vacate the C Town property to make the sale process run as smoothly as possible for all concerned.
In his report of 26 March 2019 the single expert real estate valuer, Mr U, opined as follows:
5.4      General condition
Overall Quality:       In generally good order throughout, with only some minor maintenance, mush [sic] of an ongoing typical nature, to be attended to.
Issues Noted:           Summarised as follows:
●Landscaping, gardens and lawns require continued ongoing maintenance, which is a constant issue with a property of this nature. The front lower terrace lawn has been affected by a "die off" likely caused through a sub-soil pest infestation.
The husband is at liberty to enter the C Town property, as I declined to make an order for exclusive occupation in favour of the wife in December 2018. Accordingly, the husband is able to effect personally or arrange for any repairs which may be recommended by the real estate agent prior to the marketing and sale of the property. In my view, the maintenance to which Mr U made reference can be carried out by the husband without his having occupation of the property.

Interim or partial property settlement

As noted, the wife sought that she receive a sum of $3 million from the net sale proceeds and the husband proposed that each party receive an amount of $50,000. The husband advanced two propositions against the interim property settlement sought by the wife.
Firstly the husband deposed:
7.I am concerned that if my former wife ("[Ms Rogers]") were to receive any significant funds from the sale of the C Town property, she is likely to dissipate the funds on extravagant and indulgent living expenses and litigation fees.
His counsel submitted that "the wife has a history of spending and the husband is concerned that he will be at a forensic disadvantage at trial." This potential "forensic disadvantage" was not outlined or identified in the submissions on behalf of the husband.
Secondly, and more significantly, it appears that the husband may now challenge the valuation of his corporate interests by the single expert Mr H. As noted, however, the husband relied upon these four valuation figures in his Financial Statement sworn on 19 August 2019. As noted further, the husband filed an Application in a Case on 20 June 2019 whereby he sought orders for a sale of the former matrimonial home and distribution of 50% of the net proceeds to himself and the wife. On 20 June 2019 the husband apparently had access to a report of 20 May 2019 by the single expert Mr H.
I am mindful of the remarks of the Full Court, in relation to interim property settlement, in Strahan and Strahan (2009) FLC 93-466, Boland and O'Ryan JJ said, inter alia:
[118] We agree with the submissions of senior counsel for the wife in relation to the approach to be taken to the hearing of an application for an interim property settlement order. There are two stages to the hearing of such an application where the power is to be exercised pursuant to s 80(1)(h) of the Act. This is recognised by the fact that although the power under s 79 should ordinarily be exercised on a once only basis, "circumstances may arise before there can be a final hearing" where the power is exercised. Thus the first step is to resolve whether to exercise the power before a final hearing and if it is resolved to do so then the second step involves the exercise of that power.
...
[132] In relation to the first stage, in our view, when considering whether to exercise the power under ss79 and 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.
...
[135] In relation to the second matter, as the jurisdiction under s 79 of the Act is being exercised the provisions of that section must be considered and applied but with limitations given that it is not the final hearing. There is also no requirement of compelling circumstances in relation to the substantive step.
[136] As to the third matter identified at Fam LR 586; FLC 79,930 by the Full Court in Harris, in discussion before us it was described as the "adjustment issue" or "claw-back issue". It was submitted by senior counsel for the wife that it is relevant to consider whether an order would give the applicant "more than they would be indubitably entitled to on a final hearing" or alternatively "would it give them so much that it could not be adjusted on a final hearing?" As we have observed the Full Court in Zschokke at Fam LR 786; FLC 83,220-21 stressed the importance of consideration of the "adjustment issue" if the power in s 80(1)(h) of the Act is being exercised. We accept the submission and observe that this matter is relevant because the discretion conferred by the power in s 79 is to make such an order as the court considers appropriate provided it is just and equitable to make the order in circumstances where the power will not be exhausted by the interim order. As Bryant CJ and Coleman J observed in Gabel at [69] and [72] the interim order must be capable of variation or reversal without resort to s 79A of the Act or appeal. As Finn J said at [126] the interim order must be "capable of alteration at any time prior to, or as part of, the final exercise of the s 79 power".
I accept that the mental health of the wife would likely be assisted if she secures financial independence from the husband, as opined by her psychologist Ms R. I consider it likely that she would benefit from the security of ownership of a home and a much lesser degree of financial intertwining with and dependence upon the husband.
I have had regard to the calculations set out in the Case Outline on behalf of the wife, as to the outcome of the orders sought by the husband in his Application in a Case of 20 June 2019. The wife's solicitor wrote inter alia:
D(vii)In the husband's Application in a Case he sought orders which provided for the wife to receive half the net proceeds of sale by way of interim property settlement. If the home sold for the value attributed by the single expert of $5,500,000 on that basis after payment of the mortgage ($500,000), agents costs and solicitors costs it is estimated that the wife would receive pursuant to the husband's earlier proposal $2,468,000. ...
The husband has the benefit of accommodation in an apartment owned by his father and he has an ongoing income stream from his employment. He sought a relatively minor partial property settlement of a total amount of $100,000 by way of partial property settlement, being a sum of $50,000 from each of a mortgage redraw and the net proceeds of sale.
The husband's financial position will be alleviated upon the sale of the property, when he is freed from liability for mortgage instalments and outgoings. The husband submitted a Notification of Costs Pursuant to Rule 19.04 of the Family Law Rules 2004. This document indicated that he has paid a total of $169,311 on account of legal costs and disbursements, experts fees and mediation expenses. The Notice did not comply with Rule 19.04, in that no information was provided as to the source of these funds.
The financial positions of the parties stand in stark contrast, with the wife being a far less advantageous position than the husband. Effectively, her only economic resource is a distribution of matrimonial assets. On the other hand, the husband has an ongoing income stream and there was no evidence that his employment is in jeopardy. As noted, he has paid so far in the litigation costs and disbursements totalling some $169,000 from an unknown source.
I accept that it is unusual that one party would receive a substantial distribution from the matrimonial pool of assets prior to a final settlement. At the same time, however, justice and equity between parties requires consideration of the circumstances of individual parties.
In his Response to Initiating Application filed on 23 November 2018 the husband sought inter alia an order for sale of the C Town property and payment to the wife of "such sum… as required so that the wife will receive overall division of the property of the parties of 50% of the net assets." As noted, the husband sought orders to the effect that the wife receive one half of the net proceeds of sale of the C Town property in his Application in a Case filed on 20 June 2019.
I have set out above the calculations by the wife's solicitor as to the effect of the orders sought by the husband in his interim application of 20 June 2019. As noted, this proposal would have seen each of the parties receive a sum of approximately $2,400,000.
I am cognisant of the fact that the parties cohabited for approximately 36 years and raised four children together. They adopted traditional and complementary roles of major breadwinner and principal homemaker and parent during their marriage. In my view, a result of an equal distribution of the net matrimonial assets would fall within a reasonable range of outcomes of this litigation.
I have concerns in relation to the "clawback" implications of a distribution of $3,000,000 to the wife from the net proceeds of sale of the C Town property. In my view, a far more appropriate course would be that the wife receives a partial property settlement of $2,000,000. The calculations submitted by the solicitor for the wife demonstrated that an amount of almost $2,500,000 would remain after payment of $2,000,000 to the wife, assuming a sale price of $5,500,000.
Accordingly, such a partial property settlement in favour of the wife could be accommodated in the context of a final resolution of this litigation with reference only to the proceeds of sale of the C Town property. Of course, there would remain for consideration the husband's corporate interests. I am satisfied that considerations of justice and equity permit a partial property settlement of $2,000,000 in favour of the wife.
I will order that the husband receive a partial property settlement of $50,000 from a redraw on the mortgage secured on the title to the C Town property. I am not satisfied that considerations of justice and equity require that he receive an additional interim property settlement of $50,000 from the net proceeds of sale of the property. I do not suggest that the husband must demonstrate "compelling circumstances" but I am cognisant of the substantial contrast in the financial positions of the parties.

Interim spouse maintenance and lump sum sought by the wife

I accept the submission on behalf of the wife, to the effect that she will require a lump sum to enable her to vacate the former matrimonial home. I do not necessarily accept that she requires the sum of $50,000 for that purpose and I am conscious that she has had access to relatively substantial sums in recent times.
I am not satisfied that the husband is in a position to pay a lump sum of $50,000 to the wife from his own resources. On the other hand, he proposed a further redraw on the mortgage account so as to enable each party to receive $50,000. If the wife received that sum of $50,000 she would be in a position to make arrangements to vacate the C Town property upon settlement of the sale.
I appreciate that the last drawdown took approximately three months but the Christmas/New Year period fell within that timeframe. In these circumstances I will make orders as proposed by the husband, in terms of a drawdown on the mortgage and distribution of a sum of $50,000 to each of the parties. These payments will be characterised as interim or partial property settlements.
I will order that the husband continue to make payments as required by the December 2018 orders, until the wife receives the sum of $2 million from the sale proceeds of the C Town property. The wife may then make an election as to whether she wishes to invest a sum of approximately $107,000 in the Motor vehicle 1 or, alternatively, acquire more affordable transport.
Given that the wife will receive a sum of $2 million, she could not establish at that time that she is unable to support herself adequately for the purposes of section 72 of the Family Law Act. At that point, Orders 2.2 and 2.4 of 19 December 2018 will be discharged and the wife will assume responsibility for these outgoings.
If orders are made as set out above, it is unnecessary that any investigation be undertaken into the financial circumstances of the husband. I am of the view that there remains a lack of clarity around his financial position but I take that issue no further for present purposes.

I certify that the preceding fifty-three (53) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Stevenson delivered on 23 September 2019.

Associate:

Date: 23 September 2019

[2019] FamCA 700

23 September 2019

Key Legal Topics

Areas of Law

Family Law

Equity & Trusts

Legal Concepts

Constructive Trust

Remedies

Injunction