FEDERAL CIRCUIT COURT OF AUSTRALIA
| SACCO & BAGALA | [2013] FCCA 972 |
| Catchwords: FAMILY LAW – Property – assets and liabilities – “add-backs” – partial property settlement – whether premature distributions of property should be added back to the asset pool – contributions of the parties – whether adjustment under Family Law Act 1975 (Cth) warranted – whether just and equitable. |
| Legislation: |
| Cases cited: Hickey & Hickey [2003] FamCA 395; (2003) 30 Fam LR 35; FLC 93-143 NHC & RCH [2004] FamCA 633; (2004) 32 Fam LR 518; FLC 93-204 AJO & GRO [2005] FamCA 195; (2005) 33 Fam LR 134; FLC 93-218 Sacco & Bagala & Anor [2011] FMCAfam 834 Stanford v Stanford [2012] HCA 52 |
| Applicant: | MR SACCO |
| Respondent: | MS BAGALA |
| File Number: | SYC 6603 of 2008 |
| Judgment of: | Judge Scarlett |
| Hearing dates: | 20-22 July 2011, 27 July, 1-2 November 2012 |
| Date of Last Submission: | 2 November 2012 |
| Delivered at: | Sydney |
| Delivered on: | 28 June 2013 |
REPRESENTATION
| Counsel for the Applicant: | Mr Schonell SC |
| Solicitors for the Applicant: | Broun Abrahams Burreket |
| Counsel for the Respondent: | Mr Maiden SC (until 22 July 2011) Mr Tregilgas (from 27 July to 2 November 2012) |
| Solicitors for the Respondent: | Byrnes & Cox Lawyers |
NOTATIONS
THE COURT NOTES that as provided by Order 6 of the Orders made on 27 July 2012 the Respondent Wife is to pay to the Applicant Husband the sum of $300,000.00 and the Wife acknowledges to the Court that she has obtained approval from the National Australia Bank to enable compliance with that Order.
THE COURT ALSO NOTES that the following Orders are made in addition to the Orders already made on 27 July 2012.
ORDERS
The Wife must forthwith pay all monies required to discharge the existing mortgage to the Bank of Queensland secured over the property at Property P in the State of New South Wales.
Pending discharge of the existing mortgage over the said property the Wife must pay as and when they fall due all of the statutory and consumable outgoings in respect of the said property as well as all repayments on the mortgage secured over the said property.
The Wife is to indemnify the Husband and keep the Husband indemnified in respect of any actions, claims, demands and liabilities in respect of the said property and any mortgage secured over that property.
In the event that the Wife has not paid to the Husband the sum of $300,000.00 in accordance with Order 6 of the orders made on 27 July 2012 by 31 July 2013 interest will accrue on that sum or the remaining balance at the rate prescribed under Rule 22.01 from time to time.
The Wife is to take all steps and sign all documents necessary to effect the assignment of the lease for the premises [address omitted] to herself as sole lessee and the Wife…
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- AGLC
- SACCO & BAGALA [2013] FCCA 972
- Case
- [2013] FCCA 972
- Decision Date
CaseChat Overview and Summary
The court was required to determine the specific terms of the property settlement, including the payment of monies between the parties, the discharge of mortgages and outgoings on a property, the sale of a business and property if payment obligations were not met, and the division of interests in a superannuation fund. Further issues included the transfer of company directorships and shareholdings, the allocation of tax liabilities arising from a partnership and various entities, and the transfer of a motor vehicle. The court also needed to address the consequences of non-compliance with its orders.
The court made detailed orders to effect a final division of the parties' financial interests. These orders mandated the wife to discharge an existing mortgage and pay statutory outgoings on a property, and to indemnify the husband against liabilities related to that property and a lease. The wife was ordered to pay a significant sum to the husband within a specified timeframe, with provisions for interest to accrue and for the sale of a business and the property if payment was not made. The court also ordered the transfer of 100% of the wife's entitlement from a superannuation fund to the husband, and directed the removal of the wife as a signatory and the subsequent removal of a corporate trustee from the fund. The wife was further ordered to indemnify the husband for liabilities arising from a partnership and various companies, and to pay specific tax liabilities. The husband was to resign as a director and transfer his shareholdings in certain companies to the wife, and the wife was to arrange the transfer of a motor vehicle to the husband, covering any associated taxes. The orders also included provisions for a Registrar to execute documents in the event of non-compliance and for the filing of submissions regarding costs.
Orders
Orders of the court
1.
The Wife must forthwith pay all monies required to discharge the existing mortgage to the Bank of Queensland secured over the property at Property P in the State of New South Wales.
2.
Pending discharge of the existing mortgage over the said property the Wife must pay as and when they fall due all of the statutory and consumable outgoings in respect of the said property as well as all repayments on the mortgage secured over the said property.
3.
The Wife is to indemnify the Husband and keep the Husband indemnified in respect of any actions, claims, demands and liabilities in respect of the said property and any mortgage secured over that property.
4.
In the event that the Wife has not paid to the Husband the sum of $300,000.00 in accordance with Order 6 of the orders made on 27 July 2012 by 31 July 2013 interest will accrue on that sum or the remaining balance at the rate prescribed under Rule 22.01 from time to time.
5.
The Wife is to take all steps and sign all documents necessary to effect the assignment of the lease for the premises [address omitted] to herself as sole lessee and the Wife is to indemnify the Husband in respect of any obligations, claims or demands made in respect of the lease from [L] Pty Limited to the Husband and the Wife registered number [omitted] of those premises.
6.
Within three (3) months of the date of these Orders the Wife will pay to the Husband the sum of $525,712.00.
7.
In the event that the Wife has not paid to the Husband the sum of $525,712.00 within three (3) months of the date of these Orders interest will accrue on that sum or the remaining balance at the rate prescribed under Rule 22.01 from time to time.
8.
In the event that the Wife has not paid to the Husband the monies due to him under Order (6) within three (3) months of the date of these Orders then:
(a) The Wife will take all steps and sign all documents necessary to sell the [omitted] business trading as [M] and upon the settlement of the sale of the [omitted] business the Wife will pay to the balance of the monies due to him together with any accrued interest.
(b) The Wife will keep the Husband informed of all steps in relation to the sale of the [omitted] business and will respond to all enquiries made by the Husband or his solicitors as to the sale.
(c) The Wife will do all things necessary and sign all documents necessary to market for sale and sell the said property at Property P and in particular will:
(i) Appoint an agent to market the said property for sale and failing appointment of an agent within seven (7) days the Husband will nominate in writing three (3) agents from which the Wife will select one who shall be the agent appointed and the Wife will sign all documents necessary to appoint the agent;
(ii) Market the said property for sale by public auction on a date within eight (8) weeks of the selection of the agent;
(iii) Execute all documents requested by the real estate agent for the sale of the said property by public auction;
(iv) Give such instructions as are necessary to a solicitor within seven (7) days;
(v) The reserve price will be $1,100,000.00;
(vi) Attend at the auction sale and negotiate with the highest bidder in the event that the reserve price is not reached and accept any offer which is made and is the highest not below 5% of the reserve price.
(vii) Execute the Contract for sale;
(viii) Co-operate in every way with the real estate agent in relation to the sale of the said property including making keys available, allowing inspection of the said property at all times requested by the agent and ensuring that the said property is in a neat and clean condition at the time of inspection by the prospective purchasers;
(ix) Execute all other documents necessary to complete the sale within the time required by the Contract to ensure that the purchasers do not have a right to terminate or rescind due to failure to do so;
(x) Keep the Husband informed of all steps in relation to the sale of the said property and respond to all enquiries made by the Husband or his solicitors as to the sale;
(xi) In the event that the said property is not sold at the first auction then the Wife must do all acts and things necessary to place the said property on the market for sale by private treaty for a period of two (2) months and in particular will:
A. request the agent to place the said property on the market for sale by private treaty for a period of two (2) months;
B. execute all documents requested by the agent for the sale of the said property by private treaty;
C. accept any offer to purchase the said property made in an amount within 10% of the reserve price set for the first auction;
D. execute the Contract for Sale;
E. co-operate in every way with the agent in relation to the sale of the said property including making keys available, allowing inspection of the said property at all times requested by the agent and ensuring that the said property is in a neat and clean condition at the time of inspection by the prospective purchasers;
F. execute all other documents necessary to complete the sale within the times required by the contract for Sale to ensure that the purchasers do not have a right to terminate or rescind due to failure to do so;
(xii) In the event that the said property is not sold at the first auction and is not sold by private treaty within the period of two (2) months following that time then the Wife must do all acts and things necessary to place the said property on the market for sale and sell the said property by public auction on the same terms as provided for in Order (8) above SAVE AND EXCEPT that the said property will be sold to the highest bidder at such auction and that there will be no reserve price to apply to such auction.
(d) On settlement of any sale of the said property the Wife is to sign all documents and do all things necessary to cause the proceeds of sale to be applied and distributed in the following manner and priority:
(i) In payment of all agent’s commission, advertising expenses and legal costs of the conveyancing;
(ii) In discharge of the mortgage secured over the said property;
(iii) In payment to the husband of any balance due to him from the proceeds of sale.
9.
Pending the payment to the Husband of all monies due to him under these Orders the Wife is restrained from increasing the borrowings secured over the said property and/or the [omitted] business other than for the purposes of payment of monies to the Husband under these Orders.
10.
In accordance with section 90MT(1)(b) of the Family Law Act 1975 (Cth):
(a) Whenever a splittable payment within the meaning of section 90ME of the Act becomes payable to the Wife from her interest in the Sacco Superannuation fund the husband is entitled to a specified percentage being 100% of the Wife’s entitlement and there is a corresponding reduction in the entitlement that the Wife would be entitled to receive but for this Order.
(b) Order (10)(a) above binds the Trustee of the Sacco Superannuation Fund and these Orders take effect from the operative time and the operative time for the Order is the fourth business day from the date of these Orders.
11.
Within fourteen (14) days of the date of these orders the Husband and the Wife in their capacity as directors of the Trustee company of the Sacco Superannuation Fund sign all documents and take all steps necessary to remove the wife as a signatory of any bank account operated by the Sacco Superannuation Fund.
12.
Upon compliance with Order (10)(a) the Husband and Wife must do all acts and things and sign all documents necessary to remove [M] Pty Limited as a trustee of the Sacco Superannuation Fund and appoint in its place a suitably qualified person or entity nominated by the Husband and the Wife will resign her membership of the Sacco Superannuation Fund.
13.
Within fourteen (14) days of the date of these Orders the Wife must do all acts and things to serve [omitted] Accountants with an authority to release all records relating to the Sacco Superannuation Fund to the Husband.
14.
The Wife must forthwith indemnify the Husband and keep the Husband indemnified from and against all actions, suits, claims, demands and liabilities in respect of his having been a member of the [Mr & Mrs Sacco] Partnership trading as [M] including any liability for tax in respect of any income allocated to the Husband from the said Partnership or any tax liability referable in any way to the dissolution of the Partnership.
15.
On or before 5 July 2013 the Wife is to pay to the Australian Taxation Office the sum of $13,636.20 for the Husband’s estimated income tax liability in respect of the income allocated to him from the said Partnership for the year ended 30 June 2012 and pay to the Husband the sum of $1,042.00 in reimbursement of income tax paid by him for the 2012 financial year referable to the income of the said Partnership.
16.
Subject to the provisions of Order (10) above the Husband being effected the Husband will sign all documents necessary as provided by the Wife to:
(a) Resign as a director of [M] Pty Limited and [C] Pty Limited; and
(b) Transfer his shareholding in [M] Pty Limited and [C] Pty Limited to the wife.
17.
The Wife will indemnify and keep the Husband indemnified in respect of all actions, suits, claims, demands and liabilities in respect of [M] Pty Limited, [C] Pty Limited and The Sacco Family Trust including any income tax liability the Husband has incurred or may incur regarding income received from [M] Pty Limited, [C] Pty Limited and/or The Sacco Family Trust.
18.
Within fourteen (14) days the Wife will take all steps and sign all documents necessary to procure the transfer to the Husband of the VW Polo motor vehicle registration number [omitted] in the Husband’s possession and in the event that the transfer gives rise to the payment of any tax or charge by the Husband the Wife shall forthwith pay any such tax or charge.
19.
Save as provided above the Husband and the Wife shall be solely entitled to the exclusion of the other to all property and chattels of whatsoever nature and kind in the possession, ownership or control of each party as at the date of these Orders.
20.
In the event that either party refuses or neglects to comply with a direction to execute any deed, document or instrument necessary to give effect to these Orders a Registrar of the Court is appointed under the provisions of section 106A of the Family Law Act 1975 to execute the deed, document or instrument in the name of the person to whom the direction was given and to do all acts and things necessary to give validity and operation to the deed, document or instrument.
21.
Written submissions in support of any Application for costs are to be filed and served within twenty-eight (28) days of the date of these Orders and written submissions in opposition to any such application are to be filed and served within a further period of fourteen (14) days.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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