Salter & Salter
[2024] FedCFamC1F 629
•19 September 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Salter & Salter [2024] FedCFamC1F 629
File number(s): DNC 591 of 2017 Judgment of: BERMAN J Date of judgment: 19 September 2024 Catchwords: FAMILY LAW – PRACTICE AND PROCEDURE – Where significant interim orders were made in 2018 – Where neither party seeks a trial listing – Where the applicant wife asserts CGT issues may need to be determined – Where there are no outstanding matters for the Court to determine – Consideration of whether the proceedings should be dismissed – Orders dismissing the proceedings. Legislation: Federal Circuit and Family Court of Australia Act 2021 (Cth) s 67. Division: Division 1 First Instance Number of paragraphs: 41 Date of hearing: 20, 28 & 29 August 2024 Place: Heard in Darwin, delivered in Adelaide Counsel for the Applicant: Ms Farmer Solicitor for the Applicant: AFL Withnalls Lawyers Counsel for the Respondents: Mr Richards Solicitor for the Respondents: Povey Stirk Lawyers & Notaries ORDERS
DNC 591 of 2017 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS SALTER
Applicant
AND:
MR SALTER
First Respondent
B PTY LTD
Second Respondent
MR G SALTER
Third Respondent
ORDER MADE BY:
BERMAN J
DATE OF ORDER:
19 SEPTEMBER 2024
THE COURT ORDERS THAT:
1.The Initiating Application filed 12 December 2017 and the Response to Initiating Application filed 21 February 2018 are dismissed and the proceedings be removed from the pending list of cases.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
Berman J
BACKGROUND
Ms Salter (“the wife”) is the applicant and Mr Salter (“the husband”) is the respondent. The parties were married for 50 years. Following separation, the parties entered into detailed negotiations in an attempt to resolve property settlement and division.
Throughout the entirety of the relationship the parties lived and worked on large remote farming properties. There is no dispute or disagreement that they worked cooperatively and by their joint efforts provided for the benefit of their family and each other.
The husband worked in the agricultural industry and was employed in that capacity eventually leading to self-employment.
There is a long history of contribution and acquisition. In 1968 the wife’s father gifted the wife 4,000 pounds for which she purchased a new motor vehicle. In 1990 the husband’s mother passed away and he inherited her home in Town O. The wife received an inheritance of $15,000 from a relative and was gifted an early inheritance of $10,000 by her father in 1999 which assisted in the purchase and relocation of the parties farming operation. In 2007 the wife inherited approximately $650,000 which she retained.
The parties separated in 2016. They owned two substantial properties known as B Property and D Property. Following separation, the wife remained at B Property with the husband moving to D Property.
At the commencement of the proceedings, the unresolved issue related to the interests of the parties’ children, Mr F Salter and Mr G Salter, who held a 35 per cent interest in the B Trust in addition to the farming partnership.
Between 2018 and 2020 the proceedings have been listed for trial on four occasions. On 18 October 2019 the parties entered into detailed interim orders which resolved the substantive differences between them. The orders had the advantage resolving the interests of Mr F Salter and Mr G Salter.
By reference to the husband’s Notice of Contention filed on 20 April 2021, he contended that the matter was unable to proceed to trial in circumstances where notwithstanding that the significant interim orders had been complied with, there were now unresolved taxation and CGT consequences that are yet to be apportioned and dealt with. In addition, the partnership had been dissolved but the accounts had not been finalised.
PROCEDURAL HISTORY
The wife commenced proceedings by way of Initiating Application filed 12 December 2017. The husband filed his Response to the Initiating Application on 21 February 2019.
On 28 March 2018 a Judicial Registrar made orders joining B Pty Ltd as trustee for the B Trust (“second respondent”) and C Pty Ltd (“third respondent”) and by Consent Orders filed 21 October 2019, Mr F Salter was joined as fourth respondent and Mr G Salter was joined as fifth respondent.
On 16 August 2018, the Court heard an argument in relation to discovery and the valuation of property interests namely, the B Property. The remainder of the Application in a Proceeding was listed for hearing on 13 September 2018.
The matter was listed for final hearing to commence on 29 January 2019 (“the first trial listing”).
On 12 September 2018, orders were made that transferred the matter of Snell & Salter, action number BRC 9112/2016, to this Court with the parties consenting to the proceeding either being consolidated with the current proceedings or be heard concurrently.
On 27 September 2018 orders were made that saw the interim proceedings dismissed. On 24 October 2018 the first trial listing was vacated and a hearing to determine the consolidation of the Civil and Family proceedings was listed for 29 January 2019.
On that date, orders were that the matter be listed for trial to commence on 26 August 2019 (“the second trial listing”) with a listing for trial directions to be heard on 4 March 2019. Notations were made that the matter was also intended to be listed as a reserve trial for the week commencing 19 August 2019.
Between 4 March 2019 and 25 July 2019 various orders were made extending time to comply with the trial direction orders and on 1 August 2019 orders were made vacating the trial date and listing it to commence on 14 October 2019 (“the third trial listing”).
On 18 October 2019 significant interim orders were made by consent which provided for:
·The resolution of the transfer of Ms Snell’s interest in the trust and her roles within the partnership to Mr G Salter. Mr G Salter was then to relinquish Ms Snell of any debts or liabilities arising from the partnership and B Pty Ltd;
·The sale of B Property in the event that Mr G Salter did not make payments within 9 months of the settlement date;
·The transfer of various properties and/or interest from Mr G Salter to Ms Snell and from Ms Snell to Mr G Salter;
·The superannuation splitting order from Mr G Salter to Ms Snell;
·B Pty Ltd to transfer all rights and interests in D Property to the Trustee for the Mr Salter Family B Trust; and
·The partners to do all things to transfer the P Company agreement and livestock brands registered to Mr F Salter.
Following the determination of an interim application, orders were made on 15 May 2020 listing the matter for final hearing on 28 September 2020 (“the fourth trial listing”).
On 15 March 2020, orders were made for the parties to file a memorandum setting out the contentions of fact and law necessary for the proceedings to be given a trial date.
On 21 September 2020, orders were made vacating the fourth trial listing.
On 16 February 2022, orders were made that the matter be placed at the bottom of the trial pool list.
On 3 November 2023, the matter was called on by a Judicial Registrar as part of the Division 1 Darwin list of matters awaiting trial. Only the applicant was in attendance and the submissions were made that the applicant sought to remain at the bottom of the trial pool list. The Judicial Registrar made orders for the parties to be provided with leave to contact the Court and request that the matter be called on in the event the parties were unable to reach agreement with respect to valuations, dispute resolution and other procedural matters.
Nothing further was heard of the matter until orders were made by me causing the matter to be relisted for hearing to coincide with the Darwin circuit sittings.
On 20 August 2024, Ms Farmer appeared for the wife and Mr G Salter (“the fifth respondent”) in her capacity as their solicitor, Mr Richards of counsel appeared for the husband and Ms Davies of Senior Counsel appeared for C Pty Ltd (“the third respondent”).
Orders were made that the third and fourth respondents were removed from the proceedings and amendments were made to paragraph 44 of orders made 18 October 2019 to remove Ms Snell from any further obligation arising.
SUBMISSIONS OF PARTIES
The husband considers that each of the parties have carried into effect the terms of the orders made on 18 October 2019 and since that date, no party to the proceedings has given notice of any matter arising in respect of the interim orders made 18 October 2019.
It is a reasonable observation that the costs incurred by the parties have been significant. As at 19 August 2024 the total fees incurred by the wife, including if the matter were to proceed to trial, would be approximately $1,000,000. The husband’s fees are in the sum of $553,000 and obviously substantial fees would be incurred if the matter were to proceed to final hearing.
Without attempting to oversimplify the circumstances in which the parties find themselves, it appears that the issue of concern to the wife was the extent to which CGT would be assessed consequent upon the transfer of property pursuant to the 2019 interim orders.
For that to be determined the financial statements for B Property for the financial years of 2019, 2020, 2021 and 2022 needed to be finalised. It was conceded by the wife’s solicitor that there had been a substantial delay in the accounting work being completed although, some explanation was promoted that involved other financial considerations.
To the extent that the stumbling block to the parties reaching a final agreement likely to be in the same terms as the 2019 interim orders, the issue of CGT needed to be resolved.
As matters have now transpired, the financial statements have been prepared and the position adopted by the husband is that:
(a)The B Trust was a small business based on turnover;
(b)A 50 per cent capital gain discount applied to trust distributions to individuals;
(c)The parties were both over the age of 65 years; and
(d)That as a result it was unlikely there would be any CGT payable by either the husband or the wife arising out of the trusts assessable capital gain and there appears there is now a concession that there is not likely to be any capital gains tax assessment of significance.
Neither party sought that the matter be listed for trial. There was some fleeting suggestion that the parties would now be able to resolve some outstanding minor adjustments but that there would be no utility in the parties incurring significant legal fees to prepare the matter for trial.
It was not suggested for and on behalf of either party that the matter should be adjourned and if so for how long and what reasonable expectation there was of any minor unresolved issues being determined.
CASE MANAGEMENT
The core principle in the Central Practice Direction sets out the Court’s obligation and overarching purpose as follows:
3.3the overarching purpose to be achieved is to facilitate the just resolution of dispute:
(a) according to law; and
(b) as quickly, inexpensively and efficiently as possible.
3.4 the overarching purpose to include the following objectives:
(a) the just determination of all proceedings before the court;
(b)the efficient use of the judicial and administrative resources available for the purposes of the court;
(c) the efficient disposal of the court’s overall caseload;
(d) the disposal of all proceedings in a timely fashion; and
(e)the resolution of disputes at a cost and by a process that is proportionate to the importance and complexity of the issues in dispute.
The core principle is a reflection of s 67 of the Federal Circuit and Family Court of Australia Act2021 (Cth).
CONCLUSION
The matter has been before the Court since 2017. It has been listed for final hearing on four occasions and for various reasons, it has not proceeded to resolution.
The parties negotiated a substantial agreement as evidenced by the interim orders made on 18 October 2019.
There is a concession that those orders have effectively resolved the dispute between the parties and the last area of inquiry namely the extent to which there would be any CGT levied, if any, has now been the subject of effective resolution.
In circumstances where neither party seeks that the matter be given a trial listing, I am of the view that there is no utility in the matter remaining as a case pending.
I have foreshadowed with the parties, subject to submission to the contrary, that the Initiating Application and Response should be dismissed thereby resolving the proceedings to finality. Neither party spoke against the intimation.
Accordingly, I propose to dismiss the proceedings and I make orders as appear at the commencement of these reasons.
I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Berman. Associate:
Dated: 19 September 2024
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