Silve and Pardo

[2010] FamCA 915

FAMILY COURT OF AUSTRALIA

SILVE & PARDO [2010] FamCA 915

FAMILY LAW – PROPERTY – Interim – Orders for sale

APPLICANT: Ms Silve

RESPONDENT: Mr Pardo

FILE NUMBER: SYC 973 of 2010

DATE DELIVERED: 10 September 2010

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: The Hon. Justice Cohen

HEARING DATE: 10 September 2010

REPRESENTATION

APPLICANT: Ms Silve in person

COUNSEL FOR THE RESPONDENT: Mr Campton

SOLICITOR FOR THE RESPONDENT: Gayle Meredith & Associates

Orders

1. That paragraphs 1, 2 and 3 of the wife’s Amended Application in a case filed in court on 10 September 2010 together with her Application in a Case filed 28 June 2010 is hereby dismissed.

2. That leave is granted to the husband to bring an application on two (2) days notice before Justice Cohen via direct contact with the Associate to Justice Cohen for vacant possession of the property in the event there is an obstruction of the sale.

3. That all unresolved aspects of the wife’s application and husband’s response that have not been dealt with by Justice Cohen shall be listed before a Registrar at the earliest convenient date.

4. That the costs of the Stay Application and this Review are reserved.

Notation:

A.That the husband has in response to the anticipated claim by the wife for spousal maintenance made an open offer in Court before me that from the proceeds of sale of the former matrimonial home each party be paid $100,000 by way of interim property settlement.

Notation in chambers:

B:That the date to be listed in order 3. has been fixed at 10am 23 September 2010.

IT IS NOTED that publication of this judgment under the pseudonym Silve & Pardo is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER:  SYC 973 of 2010

MS SILVE

Applicant

And

MR PARDO

Respondent

REASONS FOR JUDGMENT

1. In this proceedings on 2 June 2010 Judicial Registrar Johnston, as he then was, made orders, among other orders, which would have allowed the wife to pay out certain debts on the former matrimonial home at K within 28 days, and for that purpose, to borrow $700,000. In the event that she failed to do that, ordered the former matrimonial property to be sold and made orders appropriate for such sale.  On 17 August, after the time had run which would have allowed the wife to raise the money and make the payment which would have prevented the sale, he, in addition, ordered that, if the wife fails to execute any documents to permit the sale, that the husband be empowered to execute those documents on behalf of the wife. 

2. In an amended application for orders that the wife filed today by my leave, she seeks, in the first three of those, to appeal from the orders of the Judicial Registrar in relation to the sale.  There are other orders that she seeks, which would take me far more time than I have available today in a defended motion list to hear. Those can be dealt with at some other time in the event that she continues to persist in seeking them. 

3. The husband’s attitude to the appeal, and I think I am right in saying that, originally, the wife’s applicant from the Judicial Registrar’s orders was within time, is that the appeal by way of rehearing should be dismissed.

4. The situation that I derive from the evidence that I have read is that, essentially, the assets of the parties are somewhere between $1.2 million and $1.6 million gross.  The main asset that they have is the former matrimonial home, which the husband says is worth $1.5 million and the wife says is worth $1.1 million.  The parties’ liabilities amount to approximately $875,000, of which approximately $860,000 is owed to banks.  $17,000 is owed to the private school at which the parties’ child lives. 

5. Of the moneys owed to the bank, the husband’s leased car involves debts of $62,000. It is also included as a credit in the assets of $50,000.  The $62,000 is not immediately payable. It would not be an economical proposition, nor save the parties much money, if he was to sell that car and buy, as he would need, a cheaper car.  It is not worthwhile, nor appropriate, in my view, to consider forcing the sale of that car. I should look at the other debts, in any event, in isolation from the debt or the asset value involved with the car.

6. This leaves a situation where there is about $800,000 owing to banks, and the asset included in the house which is worth $1.5 million to $1.1 million.  The wife says that she wishes to oppose the sale of the house, because she will not have a roof over her head if it is sold, and she could not face living in a home unit in any event.  On my calculations, a debt of $800,000 is likely to require, at current rates on a 25-year loan, repayment at the rate of about $7000 or more per month.  The parties simply cannot afford to make these payments. 

7. The husband’s situation, on its face, because of his income, does not seem to be particularly bad, although it is not good.  He has an average weekly income of about $3273, but he has expenditure of $3837 each week, not including any outgoings on any mortgage.  I have looked at his expenditure.  None of it, in the circumstances, appears to me to be unreasonable, apart from his expenditure on his car, which I think is slightly unreasonable but, in the circumstances, should make no difference now.  Thus, he cannot afford, in theory, to pay anything towards the indebtedness. In fact, he cannot afford to pay much towards the indebtedness.

8. The wife’s financial situation is, to say the least, uncertain. There has been a financial statement filed on her behalf on 16 March 2010.  She says it is not accurate and I should ignore it because, in some way which she fails to clarify, there are errors in it which are the solicitors’, rather than her, fault; solicitors that she no longer instructs.  However, she has filed no other material that allows me to have any real appreciation of her income.  From the bar table she, in effect, admitted her income is that which comes from two boarders and said that she could get a third boarder and earn an extra $330 a week from her.

9. She said about the balance of her income that she works in industrial relations and has done for about 30 years but is out of work at the moment, although she has $6000 owing to her for work done.  She does not say she is earning anything at the moment but says that she is trying to get work.  I think that it is appropriate for me to refer to her financial statement, because in relevant aspects it does not differ from what she told me from the bar table.  It discloses that she has income from boarders of $530 a week and no other income. To add the $330 a week for an additional boarder, if she could get one, would give her, in those circumstances, $880 a week gross, not net, which I would expect to leave her with about $600 a week after tax. 

10. She says that the house shouldn’t be sold, because she has made an arrangement with a bank to borrow $400,000.  That arrangement is subject to terms, and would involve, according to the wife’s statement from the bar table, the payment of $780 a week for it. That would still leave debts of another $400,000.  The simple fact is, on the figures that I have put forward, the wife could not even afford to feed her boarders if she was to borrow $400,000, and that borrowing would not prevent the property available for distribution between the parties from being undermined by the continuing need to pay interest, interest which would need to be paid at a rate which is significant, in view of the fact that ultimately there seems to be virtually no chance of the wife being able to maintain any home mortgage she might obtain for $400,000. 

11. It seems clear that the parties have had a relationship of some 30 years.  Both of them have, at times, earned significant moneys. In those circumstances, even if the husband is hiding a modest sum, - which would be less than $200,000 on what the wife says from the bar table - and I would not like it to be thought that I have come to any conclusion that he is actually hiding any money or that it is more probable than not that he is, on the husband being able to receive any reasonable amount under section 79, it would be impossible for the wife to borrow the money to pay out the husband and maintain the house.

12. In the circumstances that the house will have to be sold, in this particular instance it is my view that it is appropriate to sell it now, because to fail to do so will because of the small amount of net assets the parties are likely to have to divide between them, unduly reduce that amount by mounting interest and indebtedness secured over the home.  In those circumstances, I should simply dismiss the wife’s Application in a Case for review of the decisions of the Judicial Registrar which were made on 2 June 2010, for the sale of the house, and on 17 August 2010 to give the husband a power to execute documents in lieu of the wife if she fails to execute such documents as might be required in the course of the sale of the house.

ORDERS DELIVERED

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cohen delivered on 10 September 2010.

Associate:     

Date:              12 October 2010