Sanders and Sanders & Ors

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FAMILY COURT OF AUSTRALIA

SANDERS & SANDERS AND ORS [2011] FamCA 881

FAMILY LAW – PROPERTY SETTLEMENT – transactions to defeat orders – issue of whether husband’s interest in business be set aside – where the parties complied with the previous orders made by a judicial registrar to the advantage of the wife and the wife did not herself comply with those orders requiring her to make formal transfers of her interest in the business - where husband transfers his interest in the business to the two sons of the marriage - where the husband’s business was in a precarious financial state and the husband suffered deterioration in his mental health when the husband decided to transfer his interest – where husband’s decision to transfer his interest was taken when the husband was unaware when litigation might progress if at all – transfer was unlikely to represent a disadvantage to the wife – where impact of setting aside would have a catastrophic financial effect on innocent third parties – no orders made to set aside husband’s disposition.

FAMILY LAW – PROPERTY SETTLEMENT – full and frank disclosure by parties – where the wife asserted that the husband failed to make full and frank disclosure – where the husband made disclosure by providing three volumes of documents annexed to his affidavit – no cross-examination of husband by wife about failure to disclose – where wife’s expert witness was not briefed with the husband’s financial disclosure documents – held no failure by husband to make proper disclosure.

FAMILY LAW – PROPERTY SETTLEMENT – determining matrimonial net asset pool – where parties’ assets have been previously divided by court orders - where parties have minimal assets other than superannuation – where most of the parties’ monies received from the sale of the family home is spent or accounted for in legal costs – orders for no further division.

FAMILY LAW – PROPERTY SETTLEMENT – spousal maintenance – interim order made provision for spousal maintenance of the wife by the husband – where husband ceased paying spousal maintenance due to parties’ changed financial circumstances and made an additional payment to wife of $30,000 – wife is not in employment and in receipt of disability pension – where the bulk of the money received by wife from the sale of the family home has been expended on legal costs – where husband is in part-time employment and has high levels of debt – where husband has suffered from deterioration in mental health – no orders made for ongoing spousal maintenance - no orders made for payment of spousal maintenance in arrears.

FAMILY LAW – CONDUCT OF A REVIEW – application for review of an order of a judicial registrar – a court must hear the application as an original hearing or hearing de novo.

Family Law Act 1975 (Cth) ss 75, 79, 106B
In the Marriage of Gould (1993) FLC 92-434
APPLICANT: Mr Sanders
FIRST RESPONDENT: Ms Sanders
SECOND RESPONDENT: U Pty Limited
THIRD RESPONDENT:
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Details
Case
[2011] FamCA 881
Decision Date

CaseChat Overview and Summary

In *Sanders and Sanders & Ors*, Cleary J considered applications by both the husband and wife following previous orders made by a judicial registrar. The primary dispute involved the wife's assertion that the husband had transferred his interest in a business to their two sons with the intention of defeating her claims, and her further assertion that the husband had failed to make full and frank financial disclosure. The wife also sought ongoing spousal maintenance and payment of arrears, while the husband sought dismissal of the wife's applications.

The court was required to determine whether the husband's transfer of his business interest to his sons should be set aside as a transaction to defeat the wife's claims. It also needed to assess whether the husband had made full and frank financial disclosure, and whether any further division of the parties' remaining assets was warranted. Finally, the court had to consider the wife's claims for spousal maintenance, both ongoing and in arrears, in light of the parties' changed financial circumstances.

Cleary J reasoned that while the parties had not fully complied with previous orders, the husband's transfer of his business interest occurred during a period of mental health deterioration and precarious financial circumstances for the business. The court found that the transfer was unlikely to disadvantage the wife and that setting it aside would have a catastrophic financial impact on the innocent third parties (the sons). Regarding disclosure, the court noted the husband had provided extensive documentation and the wife had not cross-examined him on its adequacy, nor had her expert been briefed with the documents, leading to a finding of no failure to disclose. The court also found that the parties' remaining assets were minimal, with most funds from the sale of the family home expended on legal costs, and therefore no further division was ordered. Concerning spousal maintenance, the court discharged the interim order, noting the husband's cessation of payments due to changed financial circumstances, his own debt and mental health issues, and the wife's receipt of a disability pension, concluding no orders for ongoing maintenance or arrears were justified.

Consequently, the court discharged the previous order for spousal maintenance as from August 2009, dismissed both the wife's and the husband's applications otherwise, and extended the time for compliance with specific previous orders, appointing a Registrar to sign documents if a party refused to do so.

Orders

Orders of the court

1.

That the order for spouse maintenance made 29 May 2010 is discharged as from 29 August 2009.

2.

That the Application of the Wife filed 5 November 2010 is otherwise dismissed.

3.

That the Application of the Husband is otherwise dismissed.

4.

That time for compliance with Orders 2.4 and 2.5 made 29 May 2009 is extended to close of business on the twenty-eighth day after delivery of these Orders and Reasons.

5.

That should a party refuse or neglect within 7 days of a written request to do so to sign any document to implement the above orders, a Registrar of the Family Court of Australia be appointed pursuant to s 106A of the Family Law Act 1975 to sign such document or documents on behalf of the defaulting party and do all acts and things and give validity thereto.

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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