Sprinzl and Sprinzl

[2007] FamCA 588

FAMILY COURT OF AUSTRALIA

SPRINZL & SPRINZL [2007] FamCA 588

FAMILY LAW - CHILD SUPPORT - Application for departure
FAMILY LAW - INJUNCTIONS - Exclusion from matrimonial home

Family Law Act 1975 (Cth)

Davis and Davis (1983) FLC 91-319

APPLICANT: Mrs Sprinzl

RESPONDENT: Mr Sprinzl

FILE NUMBER: SYC 858 of 2007

DATE DELIVERED: 19 April 2007

PLACE DELIVERED: Sydney

JUDGMENT OF: Johnston JR

HEARING DATE: 19 April 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Dura

SOLICITOR FOR THE APPLICANT: Pearson Family Lawyers

COUNSEL FOR THE RESPONDENT: Mr Richards

SOLICITOR FOR THE RESPONDENT: Family Law Solutions

Orders

1. I note that the parties will present to me as soon as possible a minute of orders reflecting my decision to enable me to make orders in these proceedings.

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 858  of 2007

Mrs Sprinzl

Applicant

And

Mr Sprinzl

Respondent

REASONS FOR JUDGMENT

1. These are interlocutory proceedings which arise out of substantive property and parenting proceedings between the parties Mrs S, to whom for convenience I shall refer as “the wife”, and Mr S, to whom for convenience I shall refer as “the husband”. 

2. The multitude of interlocutory applications came before me recently in a duty list and I was informed on that occasion that there was a very considerable amount of material to read.  It was obvious to me that the time which would be available in the duty list was not going to be sufficient to be able to endeavour, even start to try and understand the issues which would be before the Court.  In those circumstances I stood the matter over to today.

3. It has taken me the best part of the day to read the material in support of the various applications.  They really fall into a number of different categories.  Before I go into the details of those I say that the parties to their great credit have persevered with negotiating outcomes in respect of many of the matters which are in contention.  I understand I shall have the benefit of a minute of orders which the Court will be asked to make.

4. I do not propose to read onto the record the detailed applications which each of the parties seek.  In general terms there is an application by the wife for various injunctions in respect of the husband's management of a corporation which has really been the lifeblood of the parties' income and lifestyle throughout the major part of their marriage.  This is the corporation called A.  I shall refer to it by the acronym … .  There really was not much contest in respect of those matters and I am satisfied that injunctions will able to be put in place by agreement between the parties which really accommodate both parties' requirements in that regard.

5. There was an issue concerning some interim spousal maintenance for the wife.  That is no longer proceeding in the face of an application by the husband for what is really a partial distribution of the parties' property.  What the husband sought in his amended response were orders which in practical terms would place each of the parties in funds of approximately $1 089 000 each and some other amounts.  That dealt with the issue of interim spousal maintenance.

6. That has left three matters remaining.  Firstly, there is a specific order sought by the husband to the effect that the parties facilitate the withdrawal of a term deposit in the ANZ Bank in the name of the corporation to which I have just referred and to use those moneys in effect to retire debt of $1.5 million. 

7. The remaining matters are that the wife seeks an order for departure from the current child support assessment in respect of the parties' youngest child, daughter H, who was born on … April 1981 and I shall come to that shortly.

8. A matter which is in keen dispute between the parties relates to exclusive occupancy of the former matrimonial home.  That is the parties' home at E.  The wife seeks an order to the effect that the husband be required to vacate that home and thereafter she be permitted to have the exclusive occupancy of the home.

Background

1. The brief background matters are as follows.  The husband was born on … February 1947 and the wife was born on … August 1958.  The parties commenced cohabiting in approximately 1978.  They married on 3 September 1979 and separated on 1 October 2006.  In addition to the daughter, who is the youngest child, the parties have three other children.  These are son G who was born on … December 1980 and who is therefore 26 years of age, son B who was born on … April 1983 and who is therefore 24 years of age and son J, who was born on … September 1988 and who is therefore 18 years of age.

2. At first sight of the material it appeared that the parties' affairs were quite complex in the sense that they have operated their affairs through a quite intricate structure of corporations and a limited holding partnership, Q Echo.  It is complicated in the sense that there has undoubtedly been a very considerable amount of accounting over the years.  Each of the parties is being assisted by accountants and to their credit they have agreed that a single expert, Mr G, should be appointed to value the corporation A.  I am hopeful that, upon Mr G being able to undertake that valuation, the parties might then be able negotiate an outcome in the substantive proceedings.

3. It seems, at least on my reading of the very extensive material that there have been a considerable amount of mutual suspicion by each party about the financial activities of the other party.

4. It appears on the material at least at this stage that although the parties are the equal owners of the corporation A and it has been the husband who has really been involved, certainly in recent years, with the major operation of this corporation. 

5. The wife in turn in more recent years has conducted a retail jewellery business under the style of a corporation, G Pty Ltd.  As I think is probably reflective of the parties' approach to matters generally until very recently, the husband is an equal shareholder in the wife's business. 

6. The first matter which is in contention is an application by the husband for an order to the following effect:

   “That within 14 days of 1 July 2007 the husband and the wife forthwith do all that is necessary and sign all documents necessary to facilitate the withdrawal of ANZ corporate term deposit number […] in the name of [A] Pty Ltd and pay all such moneys equally to the husband and the wife as fully franked dividends.  Upon payment, the husband and the wife shall repay in full their joint personal loan in the sum of $1 500 000 to the ANZ Bank.”.

7. The husband’s case is that these are moneys which are available to the corporation.  They are sitting in the term deposit.  There is no issue between the parties that there is an indebtedness to the ANZ Bank of $1 500 000, apparently on the parties' joint personal loan.  On the other hand, what the wife asks the Court to do in effect is to dismiss that application at this stage but to leave it open for that amount of money to be paid out once Mr G has been able to complete his inquiries.

8. I must say that I am struggling with that concept.  I can understand the wife, not being familiar with the business dealings of the husband and with the movement of funds within the A corporation and the various related corporations, being reticent about that matter.  But, as I have indicated to learned counsel for the wife, I cannot see how the wife's case can possibly be prejudiced by an order to the effect that moneys outstanding in that amount in that account be repaid by a term deposit which is sitting in that very same bank.  It still leaves open for the wife the opportunity if necessary, either through Mr G or through some other source, to undertake some investigation of that account.  In any event, it remains open to her to pursue those matters during the course of the substantive hearing which, no doubt, if the matter proceeds, will probably proceed over several days.

9. The Court is guided by the injunction power to preserve property.  Clearly to pay out that amount would spare the parties ultimately the cost of some further interest on that amount.  It is a substantial amount of money.  One can take judicial notice of the fact that there would be a considerable amount of interest being accumulated in respect of that indebtedness.  So, on the one hand it seems to me that it would be to the advantage of the parties to pay that amount out.  On the other hand, I am unable to understand how the wife would be prejudiced by that payment.  I have not been persuaded, notwithstanding some vigorous submission by learned counsel for the wife in respect of that.  In my view, therefore, that application ought to succeed and I propose to put an order in place to that effect.

10. The next matter is the wife's application for a departure from child support assessment.  As I have said, this is a child support assessment in respect of the parties' daughter H.  Up until the time of the parties' separation, the husband had been paying a regular amount to the wife.  He paid an amount of approximately $9800 per month into the parties' joint ANZ Bank account, from which each of the parties drew funds for their various living expenses.  Just after the parties separated, the husband closed that joint account and retained the proceeds of the account.  Approximately one week before that, the husband cancelled the wife's payment of salary from the corporation A.  The wife says that she was without funds.  But the reality was that, as a consequence of some correspondence between the parties' solicitors, the husband had paid the wife a lump sum of approximately $31 000.  Having heard some argument about this matter on a previous occasion and also read about it today, it seems this proposal was intended by the husband as some sort of spousal maintenance and some sort of child support.  It seems to have been the wife's view that the moneys were being paid not necessarily for those purposes.

11. In any event, the wife approached the child support registrar shortly after separation at a time in December last year and made an application for an assessment of child support.  There was an initial assessment made issuing a liability to the effect that the husband pay a monthly amount in quite a modest sum of about $247.  That was shortly thereafter increased on a review or reassessment to the current amount of $990.25 per month.  On my calculation this breaks down to approximately $228 per week.  That was said to be based on the child support income amount of $80 000.

12. The wife seems to take issue with that child support income amount.  I am sure that in the fullness of time the real level of the husband's income will become much clearer.  In her material the wife refers to the husband as having a taxable income in the financial year ended 30 June 2005 of something in excess of half a million dollars.  But the husband in his material also refers to an identical amount for that income tax year by the wife.  It seems to me that what that must have been based on was the profitability of the company at that time.  Ultimately those funds, instead of being distributed to the parties, found their way in various shapes and forms back through one or other of the companies for the overall benefit of the corporations as a whole which as I have said, are owned jointly by the parties.  So, the true extent of the husband's and the wife's earnings out of the company on a weekly basis is not clear at this point. 

13. But, in any event, there are a couple of issues which need to be considered in respect of this child support departure application.  The first one is a jurisdictional question.  This was raised in the opening by learned counsel for the husband on the basis that courts do not ordinarily have jurisdiction to make child support departure orders until such time as the normal administrative processes have been exhausted.  Although the submission was not put in this detailed form, I infer that that was what counsel was going to put to me in respect of this jurisdictional question.

14. There is of course power for the Court to determine a child support departure application if it decides that it is in the interests of the parties and a child to do so at the same time as hearing related proceedings.  The Court can in effect assume jurisdiction to make a departure order if the Court considers it appropriate to do so.  The question is whether that jurisdictional situation arises in the circumstances of this matter.

15. It is true that I have read some financial material.  I do not feel that I have a detailed understanding of the parties' respective financial circumstances.  I have a fairly broad sense of what is presented in the material.  No doubt the picture will become clearer in time.  But the question is whether this is a matter where the Court ought to exercise jurisdiction and indeed, if it exercised jurisdiction, would it be satisfied that there is special circumstances which would justify a departure from the current child support assessment.

16. My feeling about the matter is that it is probably not a matter where there is any strong sense of assuming jurisdiction in view of the level of support that is being paid by the husband. But, even if I am wrong about that, what the wife as the applicant in the proceedings needs to establish is one of the grounds for departure under s.117(2) of the Child Support (Assessment) Act 1989. I am told that the application is really made on the basis of the ground under s.117(2)(c) of the Act namely, that in the special circumstances of the case, application of the administrative assessment provision would result in an unjust and inequitable determination of the level of child support to be provided by the husband because of his income, earning capacity, property and financial resources.

17. What the wife is seeking is an order to the effect that child support liability of the husband be required in the amount of $1500 per calendar month in place of the current arrangement, which is $990 per calendar month.  In my view, the wife has a huge difficulty about this because of the overall financial circumstances of the parties.  Firstly, she is a person who is successfully running a business of her own.  That business seems to pay her a very modest income.  The figures which the wife presents to the Court in her material in terms of that business is it deposes something like $520 a week plus a very modest amount of superannuation.  Her own accountant's material points out that think for the financial year ending on 30 June 2006 the business profit for that company, which I think as I have already said is half owned by the wife and by the husband, was something like $21 763.  In the overall context of the wealth of these parties, bearing in mind that it is common ground that that is in the vicinity of $5 million to $6 million, is really a fairly modest amount.  But it seems to me that it is a difficult matter for the wife to achieve an increase in the child support on the basis of some special circumstances or the justness of the case where the parties have agreed that there ought to be a preliminary distribution of their property in the vicinity of $1 million each. 

18. So, the husband is currently required to pay under the assessment approximately $228 per week.  The wife is seeking something like $100 per week more than that.  The wife says in her material that she regards the proper cost of the child, as being something like $690 a week.  When I went through the cost estimates and looked at the realities of those, I thought the appropriate figure was something much closer to $400 than $700 a week.  These are matters involving some personal priorities and subjective elements.  But on the basis of what this Court commonly sees coming before it, I am far from persuaded that the child's proper needs are anything like $690 a week, despite the standard of living which would be commensurate with their receipt of income from their profitable business enterprises at quite a high level.  For the parties to be apart by such a small amount in my view falls well short of what would be required to bring the matter within the broad description of special circumstances.

19. Accordingly, in those circumstances, in my view, there is no case for departure from the current child support assessment at this point.

20. That leaves the hotly contested issue of occupancy of the former matrimonial home.  The wife's application is really on the basis that she says that it is not reasonable that the husband and she be required to live together in the former matrimonial home in circumstances where they separated, as I indicated, in October last year.  She says that since that time she and the husband have slept in separate bedrooms, that there has not been any physical relationship between them.  She says that they have not shared meals or socialised together.  I pause to observe that the husband puts that matter in issue and in fact has even filed affidavits by some of the parties' children which deny that matter and support his denials in respect of that matter.

21. On my reading of the material, the husband is probably right in that.  But the reality is probably that while there appear to have been some shared meals between the parties, in the absence of cross‑examination and any testing of this I do not have a sense of this having been something that there has been a great deal of.  In any event, as learned counsel for the wife has pointed out, the husband has been absent from the home on many occasions because his business frequently takes him away from home.  The wife says that that amounts to something like the husband staying in Sydney for an average of about two days a week, that he travels interstate for something like once a month several days at a time and that he travels overseas once or twice a year.

22. In further support of her case the wife says that in January the husband's solicitors wrote to her solicitors informing her solicitors that the husband would vacate the former matrimonial home as soon as he could find alternative accommodation.  The wife says that the husband subsequently resiled from that.  The husband said that he resiled from that offer in circumstances where he says that for quite a long time he has been suffering from what he says are serious health problems.  He says that he is visually impaired in the sense that many years ago he lost his left eye.  He says that he has deteriorating sight in the right eye and is extremely concerned that what sight he has in the right eye will further deteriorate.  He says that he has a number of other health problems, including a heart condition.  He says that his medical advice at the time shortly after he instructed his solicitors to convey his offer to the wife's solicitors, it would be adverse to his health to remove himself from the familiarity and convenience of his home.  The husband says that it was in those circumstances that he changed his mind about removing himself therefrom.

23. The wife says that it makes no sense for the parties to continue to live in the home in circumstances where they are separated.  She says that there have been arguments between the parties.  She says that the husband has threatened her.  The husband says that he has not threatened her.  The husband says that things have settled down between the parties and, in any event, that the wife has overstated the level of argumentation between the parties. 

24. The wife said that on one occasion there was some unusual behaviour by the husband in that he had removed his bedroom door during the course of, or shortly after, an argument between the parties, and then presented the bedroom door to her.  This became the source of some further argument between the parties.  It is submitted that in those circumstances this Court should exercise its discretion and order the husband out of the home.

1. As I have said, the husband says that the wife has overstated all those matters and the difficulties between the parties.  As I have also said, the husband has filed affidavits by each of the parties' sons.  The affidavit by son G said that although he is not frequently there because he works in Queensland, when he has been at the home he has not seen any arguments or disagreements between his parents.  He said that in fact they have been talking in a civil manner to one another.  The parties' son J said that the wife regularly ate meals cooked by the husband, which does not give the impression of the sort of scenario and atmosphere that the wife is endeavouring to present to the Court.

2. One might say the Court should be fairly cautious about the level to which it might feel persuaded by that sort of material by the children.  This is because it may be the case that it suits the children to be able to have the certainty of having their home rather than having their father removed from the home. 

3. The law on the matter is that the Court has a broad discretion.  There are a number of relevant cases.  Probably the best known authority is the now quite old case of Davis and Davis (1983) FLC 91-319 and the observations which Evatt CJ made referring in particular to observations by then Lindenmayer J in the case of Price and Price (unreported).  These were to the effect that if it would not be sensible, reasonable or practical to expect the parties to remain living under the same roof, then courts should look at the possibility of one or other of them being removed from the home. 

4. But I must say, in the circumstances which the husband has presented, particularly those medical matters and notwithstanding the fact that he is away so frequently from the home, in my view this is not a matter where the Court should take the serious step of removing him from the home.  Accordingly, in my view that application by the wife also fails.

I certify that the preceding thirty six (36) paragraphs are a true copy of the Reasons for Judgment of Judicial Registrar Johnston.

Associate:     ___________________

Date:              1 June 2007

IT IS NOTED that this judgment for all publication and reporting purposes be referred to as SPRINZL & SPRINZL