Shafton and Shafton (No.3) - [2018] FCCA 3088

FEDERAL CIRCUIT COURT OF AUSTRALIA

SHAFTON & SHAFTON (No.3)

[2018] FCCA 3088

Catchwords:
FAMILY LAW – Property – Enforcement of property orders – whether the husband should be relieved of liability to pay the balance of a capital sum outstanding after the sale of two real properties – whether the husband should be relieved of liability to pay interest on the whole of the capital sum from the date it fell due or on the balance of the capital sum which remained owing following the sale of the real properties – no basis for relieving the husband of liability to pay either the balance of the capital sum or interest – declaration of amount owing made and enforcement orders made.

Legislation:

Family Law Rules, r.17.03

Federal Circuit Court Rules, r.25B.11

Family Law Act 1975 (Cth), s.117B

Cases cited:

McMillan & McMillan [2016] FamCA 387
Shafton & Shafton [2011] FMCAfam 46
Shafton & Shafton [2012] FMCAfam 339
Shafton & Shafton & Anor [2013] FCCA 958
Shafton & Shafton & Anor (No.2) [2014] FCCA 2788

Applicant:

MS SHAFTON

Respondent:

MR SHAFTON

File Number:

NCC 1006 of 2009

Judgment of:

Judge Terry

Hearing dates:

24 & 30 August 2018

Date of Last Submission:

30 August 2018

Delivered at:

Newcastle

Delivered on:

19 December 2018

REPRESENTATION

Counsel for the Applicant:

Mr Levick

Solicitors for the Applicant:

Turnbull Hill Lawyers

Solicitors for the Respondent:

Browns The Family Lawyers

ORDERS

It is declared that the amount owing by the respondent husband to the applicant wife pursuant to the Orders made on 12 September 2012 is $85,000.00 plus interest of $365,892.06 to 1 May 2018 with interest accruing at the rate of 7.5% per annum.
The respondent husband shall do all such things and sign all documents necessary to enable:
(a)Company A to pay to Schofield Muir Solicitors all monies held in their trust account on behalf of the parties, being the balance of the proceeds of sale of the property at Property A; and
(b)Schofield Muir Solicitors to pay out all necessary funds to Ms D under the mortgage and to pay the balance then remaining to the applicant wife.
The respondent husband shall do all acts and things and sign all documents necessary to pay all monies due to be paid to him from the Estate of the late Mr E, to the applicant wife up to the amount owing to the wife as at the date of payment.
Pending payment of the funds in compliance with Orders 2 and 3 above the respondent husband shall be restrained by injunction from:
(a)Receiving, disposing of, mortgaging, charging or in any way dealing with his potential inheritance from the Estate of the late Mr E, other than to receive and invest those funds in his capacity as the joint Executor under the Will of the late Mr E; and
(b)Receiving and/or disposing of any of the proceeds of sale of Property A, except for the purposes of providing written instructions to Company A and Schofield…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2018] FCCA 3088
Decision Date: 19 December 2018

CaseChat Overview and Summary

In *Shafton and Shafton (No.3)*, Judge Terry of the Federal Circuit Court of Australia considered a dispute between an applicant wife and a respondent husband concerning outstanding financial orders. The wife sought to enforce orders made on 12 September 2012, which required the husband to pay her a sum of money. The proceedings involved the distribution of proceeds from the sale of a property and the husband's potential inheritance from an estate.

The court was required to determine the precise amount owing by the husband to the wife, including principal and accrued interest, and to establish a mechanism for the wife to recover these funds. This involved considering how to access and distribute monies held in a solicitor's trust account from a property sale, as well as funds due to the husband from an estate. The court also had to address the husband's conduct in relation to these assets and the potential need for injunctive relief and the appointment of an officer of the court to effectuate the orders.

Judge Terry declared that the husband owed the wife $85,000.00 in principal, plus $365,892.06 in interest accrued to 1 May 2018, with further interest accruing at 7.5% per annum. To secure payment, the court ordered the husband to facilitate the payment of property sale proceeds from his solicitors' trust account to the wife, after satisfying a mortgage. The husband was also ordered to pay any monies due to him from a specific estate directly to the wife, up to the total amount owing. The court further imposed injunctions restraining the husband from dealing with his inheritance or property sale proceeds, except as directed for payment to the wife. The court also authorised the executors of the estate to provide information to the wife's solicitors and to pay the wife's entitlement from the husband's share of the estate. Finally, the court ordered the husband to execute a charge over his interest in the estate as security and, in the event of his non-compliance, appointed the Registrar of the Federal Circuit Court to execute necessary documents on his behalf.

Orders

Orders of the court

It is declared that the amount owing by the respondent husband to the applicant wife pursuant to the Orders made on 12 September 2012 is $85,000.00 plus interest of $365,892.06 to 1 May 2018 with interest accruing at the rate of 7.5% per annum.

The respondent husband shall do all such things and sign all documents necessary to enable:

(a) Company A to pay to Schofield Muir Solicitors all monies held in their trust account on behalf of the parties, being the balance of the proceeds of sale of the property at Property A; and

(b) Schofield Muir Solicitors to pay out all necessary funds to Ms D under the mortgage and to pay the balance then remaining to the applicant wife.

The respondent husband shall do all acts and things and sign all documents necessary to pay all monies due to be paid to him from the Estate of the late Mr E, to the applicant wife up to the amount owing to the wife as at the date of payment.

Pending payment of the funds in compliance with Orders 2 and 3 above the respondent husband shall be restrained by injunction from:

(a) Receiving, disposing of, mortgaging, charging or in any way dealing with his potential inheritance from the Estate of the late Mr E, other than to receive and invest those funds in his capacity as the joint Executor under the Will of the late Mr E; and

(b) Receiving and/or disposing of any of the proceeds of sale of Property A, except for the purposes of providing written instructions to Company A and Schofield Muir Solicitors for payment of the monies held by them on interest bearing deposit to the applicant wife.

The respondent husband shall do all such acts an things and sign all such documents as shall be necessary to authorise the executors of the Estate of the late Mr E to provide to the wife or her solicitors Messrs Turnbull Hill such information in relation to the administration of the Estate as they may request.

The respondent husband shall do all such acts and things and sign all such deeds, documents, and instruments as shall be necessary to authorise the executors of the Estate of the late Mr E to pay from the respondent husband’s share of the Estate all moneys due to the applicant wife pursuant to Orders made in this Court on 12 September 2012 such amount to be advised by the solicitor for the wife and provided to the executors in writing.

The husband shall forthwith do all such acts and things and sign all documents to execute a charge on his interest in the Estate of the late Mr E as security for payment of all moneys due to the wife pursuant to the orders made by this Court on 12 September 2012.

In the event that the respondent husband refuses, fails or neglects to sign any deed, document or instrument necessary to give effect to these Orders the Registrar of the Federal Circuit Court of Australia at Newcastle is appointed pursuant to s. 106A of the Family Law Act 1975 to execute such deed, document or instrument in the name of the respondent husband and to do all acts and things necessary to give validity and operation to the deed, document or instrument.

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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