Sappho & Sappho (No 2)

Case [2022] FedCFamC1F 786

Federal Circuit and Family Court of Australia

(DIVISION 1)

Sappho & Sappho (No 2) [2022] FedCFamC1F 786

File number(s): ADC 885 of 2020
Judgment of: BERMAN J
Date of judgment: 18 October 2022
Catchwords:

 FAMILY LAW – PROPERTY SETTLEMENT – Just and equitable – Contributions – Addbacks – Future Needs factors – Where the parties cohabitated for 11 years – Where there are two children of the relationship – Where the applicant is the primary carer and the respondent is the primary income earner – Where the respondent’s company and various entities are his alter ego – Where the respondent has the ability to earn significantly more income than the applicant – Where it is just and equitable for orders to be made – Orders made.

FAMILY LAW – SPOUSAL MAINTENANCE – Where the applicant seeks orders for lump sum spousal maintenance – Where the respondent seeks that the application be dismissed – Where the applicant is unable to financially support herself – Where the Court determines that the respondent is reasonably able to pay – Consideration of the applicant’s intention not to return to work on a full-time basis but her capacity and intention to return to work on a part-time basis – Consideration of orders for settlement of property – Orders made.

FAMILY LAW – CHILD SUPPORT – Child support departure orders – Where the applicant seeks departure orders for periodic and non-periodic payments of the children’s private school and other expenses on a final basis – Where there are existing interim consent orders – Where the respondent seeks that the application be dismissed – Consideration of the ss 116 and 117 Child Support (Assessment) Act 1989 (Cth) – Where the Court does not have jurisdiction pursuant to s 116 – Where the Child Support Registrar has not been served with such an application in accordance with the Rules – Where the failure to serve the Registrar is fatal – Application dismissed.
Legislation:

 Child Support (Assessment) Act 1989 (Cth) ss 116, 117, 117(2)(b)(ii)

Family Law Act 1975 (Cth) ss 75(2), 79, 79(4)(a)-(c), 79(5)(2)

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 1.13
Cases cited:

 Bevan & Bevan (2013) FLC 93-545

Chorn & Hopkins (2004) FLC 93-204

Cleaves v Cleaves [2021] FamCA 571

C & L [2000] FamCA 1666

Finlayson v Finlayson and Gillam (2002) FLC 93-121

Jabour & Jabour (2019) FLC 93-898

JEL & DDF (2001) FLC 93-075

Kowaliw & Kowaliw (1981) FLC 91-092

Lesley & Lesley [2015] FamCA 894

Mallet v Mallet (1984) 156 CLR 605

Norbis v Norbis (1986) 161 CLR 513

Pearce & Pearce (1999) FLC 92-844

Stanford & Stanford (2012) 247 CLR 108

Townsend & Townsend (1995) FLC 92-569

Vass & Vass (2015) 53 Fam LR 373

Division: Division 1 First Instance
Number of paragraphs: 181
Date of hearing: 11-13 July 2022
Place: Adelaide
Counsel for the Applicant: Mr Anderson
Solicitor for the Applicant: Clelands Lawyers Adelaide Pty Ltd
Counsel for the Respondent: Mr Heinrich
Solicitor for the Respondent:

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Details
AGLC
Sappho & Sappho (No 2) [2022] FedCFamC1F 786
Case
[2022] FedCFamC1F 786
Decision Date

CaseChat Overview and Summary

In the matter of Sappho & Sappho (No 2), the Family Court of Australia was tasked with resolving a financial dispute between the parties, who were previously married. The applicant, born in 1982, is not in paid employment, whereas the respondent, born in 1973, is a self-employed healthcare professional operating through several entities. The central issues involved determining the respective interests of the parties in various properties and superannuation at the commencement of their relationship, and establishing orders for spousal maintenance, property settlement, and costs. The court was required to weigh the evidence and submissions from both parties to reach a just and equitable outcome.

The primary legal issues before the court were the valuation of the respondent's interests in various assets, including properties, trusts, and businesses, at the commencement of the relationship, and the appropriateness of spousal maintenance and property settlement orders. The court had to consider the financial circumstances of both parties, the contributions made by each during the relationship, and the needs of the applicant and the children. Additionally, the court needed to decide on the appropriate amount and duration of spousal maintenance, as well as the division of the net assets between the parties.

The court found that the respondent could afford to pay spousal maintenance of $521 per week for a period of twenty-six weeks. This decision took into account the applicant's capacity for employment and the potential impact of the school holiday period on her ability to work. Regarding the property settlement, the court determined that a just and equitable outcome for the applicant was to retain 72% of the net assets, amounting to $1,367,760. This included the Suburb G property, which the respondent was to transfer to the applicant as part of the settlement. The court also ordered the respondent to pay costs associated with the applicant's evidence and school fees and expenses.

The final orders included the respondent paying spousal maintenance to the applicant in the sum of $521 per week for twenty-six weeks, amounting to $13,546. The court also ordered the respondent to transfer his interest in the Suburb G property to the applicant, resulting in the applicant retaining property to the sum of $1,367,760. The respondent was to pay additional costs of $6,480 for the applicant's evidence and $18,000 for school fees and expenses, resulting in a total settlement sum of $361,449.

Orders

Orders of the court

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Background

Background to the litigation

A Case Outline document was provided by each counsel and their closing final submissions were supplemented by updated balance sheets setting out assets and liabilities of the parties.background The applicant was born in 1982 and is 40 years of age. She is not in paid employment. The respondent was born in 1973 and is aged 49 years of age. He is a self-employed healthcare professional and runs his own business via the following entities:-·Mr Sappho t/as P Business;·P1 Pty Ltd;·P2 Pty Ltd; and·A 43% interest in LL Pty Ltd t/as the LL2 Pty Ltd, held by the W Trust (“the business”). The business operates from premises situate at M Street, Suburb N (“the Suburb N property”) which is owned by the parties’ SMSF. The parties met in 2005. The respondent was an employed healthcare professional and the applicant was a healthcare worker. Cohabitation commenced in or about 2007/2008 and the parties married in 2009. The parties separated on 9 August 2019. There are two children of the marriage namely, X born 2010 (“X”) and Y born 2012 (“Y”) (collectively “the children”). As discussed, arising from the consent order, the children are in the primary care of the applicant. The children currently attend OO School. X is in year 7 and Y is in year 4. The children have attended their school since reception. Following separation, the respondent commenced a de facto relationship with his business manager. The applicant continues to reside in the property situate at F Street, Suburb G (“the Suburb G property”) whereas the respondent resides with his current partner in rental premises at Suburb AB. The parties are agreed that as part of the settlement of property, the respondent will transfer his interest in the Suburb G property to the applicant. At the commencement of cohabitation, the respondent was a partner in a business. Whilst not conceded by the applicant, the respondent’s taxable income at the commencement of cohabitation was $255,588 and the applicant’s income was approximately $40,000. A significant issue in the proceedings, is the extent of the interest of the parties in property and superannuation at the commencement of the relationship. At paragraph 20 of the respondent’s Trial Affidavit, the respondent contends that he held a valuable interest in the following assets:-(1)A property at Street, Suburb C (“the Suburb C property”).(2)A 50% interest in L Street, Adelaide (“the L Street property”).(3)An interest in the T Trust which held a third interest in investment properties at J Street, Suburb K (“the J Street property”).(4)A partnership interest in P Business.(5)An interest in W Trust set up to hold an interest in an investment property at H Street, Suburb C (“the H Street property”).(6)An interest in NN Trust.(7)An interest in RR Pty Ltd (a service entity that does not hold assets).(8)A motor vehicle.(9)Substantial savings with Westpac Bank.(10)A superannuation interest with Superannuation Fund 1 estimated by the respondent in the sum of $104,500.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

I consider that it is well within the financial resources of the respondent to pay spousal maintenance to the applicant in the sum of $521 per week. Taking into account the evidence of the applicant as to her capacity for employment, it is reasonable that the respondent pay spousal maintenance in the sum as ordered for a period of twenty six weeks ($13,546), noting that the ability of the applicant to work over the school holiday period is likely to be compromised not just by the time of year, but that the children will not be at school.conclusion The net property of the parties is in the sum of $1,899,667. Given my determination that a just and equitable outcome to the applicant is 72 per cent of the net assets, the applicant is entitled to a retain property to the sum of $1,367,760. The applicant retains the following property:- The applicant is to receive $1,367,760 less $1,044,337, leaving a balance of $323,423 with the following:-(a)spousal maintenance $13,546(b)costs of application to adduce evidence $6,480;(c)school fees and expenses $18,000; andbeing a total settlement sum of $361,449. I make orders as appear at the commencement of these reasons.

Ratio Decidendi

Legal Principle Established

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