Selena and Montez

[2016] FamCA 238

FAMILY COURT OF AUSTRALIA

SELENA & MONTEZ [2016] FamCA 238

FAMILY LAW – INTERIM SPOUSAL MAINTENCE - PROPERTY

APPLICANT: Ms Selena

RESPONDENT: Mr Montez

FILE NUMBER: SYC 939 of 2014

DATE DELIVERED: 11 April 2016

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Rees J

HEARING DATE: 11 April 2016

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Millar

SOLICITOR FOR THE APPLICANT: Gordon Barry Lawyers Pty Limited

COUNSEL FOR THE RESPONDENT: Mr Levy

SOLICITOR FOR THE RESPONDENT: Karras Partners Lawyers

Orders

IT IS ORDERED

1. That the husband pay to the wife by way of interim spousal maintenance the sum of $500 per week the first payment to be made on 18 April 2016 and weekly thereafter.

2. That on or before 1 August 2016 the husband pay to the wife by way of partial property settlement the sum of $135,000.

3. That pending further order the husband do all acts and things and sign all documents necessary to pay all mortgage instalments and loan repayments to ING Bank (Australia) Limited in respect of the loans secured by registered mortgage … registered on the title of the property known as B Street, Suburb C, and indemnify the wife in respect of all such payments.

4. That the costs of the parties in relation to this application are reserved.

IT IS NOTED that publication of this judgment by this Court under the pseudonym <pseudonym> has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 939 of 2014

Ms Selena

Applicant

And

Mr Montez

Respondent

REASONS FOR JUDGMENT

1. Before the Court are applications in relation to the marriage of Ms Selena (“the wife”) and Mr Montez (“the husband”). The parties married in 2003 and separated in 2011. Property settlement proceedings are on foot but have not been determined.

2. The wife asks the Court to make a number of orders which I will deal with seriatim. Firstly, she asks the Court to make an order for spousal maintenance in the sum of $500 per week. In the event that the Court is persuaded to make that application then the wife seeks, in the alternate, either an order for partial property settlement or an order pursuant to s117(2) of the Family Law Act 1975 (Cth)(“the Act”) for the payment of a sum of $135,000 to be used by her to fund the costs of litigation. Nextly, the wife seeks an order that the husband continue to pay the mortgage on a property which she occupies at Suburb C, pending further order of the Court.

3. Dealing firstly with the application for spousal maintenance, the evidence before the Court is that in June 2013 the wife was made redundant from a position. She received a redundancy payment of approximately $44,000 which she has spent on living expenses. She suffered a motor vehicle accident in December 2013 in which she was injured and she continues to be affected by her injuries. She deposed that she suffers from aching in the knee, heaviness in the leg and discomfort in hot, damp or cold weather. Her leg aches if she stands for extended periods.

4. In April 2014 she was successful in finding work in a retail position and she currently works in that position on two or three days each week. The amount of work available to her depends on how busy the shop is. She lives in the property at Suburb C, upon which the husband pays the mortgage. 

5. I am satisfied that the wife has established that she works to the capacity which she has and has satisfied the threshold set in s72 of the Act that she is unable to support herself from that employment.

6. The wife’s expenses are set out in her affidavit. They were not challenged by counsel for the husband. The expenses are modest. 

7. She has an earning capacity of $340 per week and expenses of $907 per week, leaving a deficit, which she is unable to fund, of $567 a week. In those circumstances, she has demonstrated a need for interim spousal maintenance in the sum of $500 per week as she seeks.

8. The husband has the capacity to pay. Although the husband disputes that fact, one only has to look at his claimed expenses. He claims expenses for himself of $2,312 a week. That includes food in the sum of $275 a week (as against the $150 a week which is adequate for the wife). More significantly, however, he pays legal fees of $1,320 per week. He can reduce the amount which he pays by way of legal fees and use those funds to fund the spousal maintenance.

9. Counsel for the wife points to the fact that, in the 2105 tax year, the husband, who has the sole control of the Montez Discretionary Trust (“MDT”), distributed from that Trust the sum of $102,368 to each of his parents. That income could have been distributed to the husband thus increasing his available income for the purpose of this exercise.

10. The wife nextly seeks an order that the husband pay to her, either by way of interim property settlement or pursuant to section 117(2) Act, an amount of $135,000.

11. The competing applications for property settlement are relevant in considering this application. The husband, in his response to the wife’s application for final orders, seeks an order that he transfer to her the property at Suburb C, in which she currently lives, and that, in addition, he pay to her the sum of $310,000. He deposes that he will meet that order by borrowing. Therefore, the payment to the wife of $135,000 by way of interim property settlement cannot be an order which is said to be outside the parameters of a final order and, as counsel for the wife points out, the equity in the Suburb C property of some $400,000 means that, in any circumstances, the amount which would be ordered to be paid by way of interim property settlement can be recovered from the Suburb C equity.

12. The husband’s financial statement discloses that he is the owner of a number of properties. He is the joint owner with the wife of a property at Suburb D, which is valued at $750,000 and has a mortgage of $354,000 and equity, therefore, of some $400,000. He is the joint owner of a property at Suburb E, which is valued at $800,000 and has a mortgage of $364,000 and equity of some $400,000 and he is the joint owner of a property at Suburb F, which has a value of $2,400,000 and a mortgage of $1,479,000 and equity of approximately $1 million.

13. The husband clearly has adequate capacity to borrow in order to meet any final order for property settlement which the Court might make. 

14. In relation to the making of the interim orders, the husband says that there is no fund to which the Court can point to make an order for the payment of $135,000. 

15. The husband is the beneficiary of the MDT. In 2015 the husband received a distribution from the trust of $128,776 and distributed to each of his parents further amounts of $104,368. The husband solely controls the trust. At paragraph 21 of his affidavit the husband, in relation to the anticipated income of the MDT , says this:

    I do not expect a repeat of that high profit figure in the 2016 financial year as QCM is presently on track to report a net profit of about $475,000 as at 30 June 2016. If that is correct, one half of this amount will be distributed to MDT and then that income will be made available for that trust to distribute to its discretionary beneficiaries as resolved by me.

16. Therefore, from approximately 30 June 2016 the trust will have available some $237,000 which can be distributed by the husband in any which he chooses, including to meet an order for the payment of an interim property settlement to the wife. 

17. I therefore propose to make an order that the husband pay to the wife, by way of interim property settlement, the sum of $135,000 on or before 1 August 2016. 

18. The next matter in dispute is whether or not there should be an order made requiring that the husband pay the mortgage on the Suburb C property. The husband, through his counsel, tells the Court that he is meeting that obligation and intends to continue to do so.

19. The wife points to the fact that in 2013 the mortgage fell into arrears and the mortgagee contacted the wife. The wife deposed that the husband told her that he would not pay the arrears. In October 2014 the mortgagee commenced proceedings in respect of the arrears, at that time about $10,000.The wife’s mother paid some $7,800 towards the arrears. Subsequently, the husband resumed payment of the mortgage. There is no prejudice to the husband, and some comfort to the wife, in an order that ensures that the mortgage instalments continue to be paid. In those circumstances, in my view, it is appropriate to make the order which the wife seeks for the husband to pay the mortgage.

I certify that the preceding nineteen (19) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rees delivered on 11 April 2016.

Associate: 

Date:  11/4/2016