Sturridge and Sturridge

[2013] FamCA 1125

FAMILY COURT OF AUSTRALIA

STURRIDGE & STURRIDGE [2013] FamCA 1125

FAMILY LAW – PROPERTY – Final orders by consent.

Family Law Act 1975 (Cth)

APPLICANT: Ms Sturridge

RESPONDENT: Mr Sturridge

FILE NUMBER: MLC 2901 of 2012

DATE DELIVERED: 13 September 2013

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Macmillan J

HEARING DATE: 13 September 2013

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Yan

SOLICITOR FOR THE APPLICANT: Coote Family Lawyers

COUNSEL FOR THE RESPONDENT: No appearance

SOLICITOR FOR THE RESPONDENT: Kerr & Thomas Lawyers

Orders

RECITALS

A.The Wife was born in City B, Country C on … 1967 and is aged 46 years.  She is a permanently resident in Australia, having moved here to study English in 1991.   The Wife worked as a professional in Country C.   During the marriage, she was employed at D Pty Ltd, a company owned by the Husband.   Her employment with D Pty Ltd was terminated in March 2012 . 

B.The Husband was born in City E, Country F on … 1962 and is aged 51 years.  He is a Managing Director of D Pty Ltd, a hose manufacturing company based in Melbourne.

C.The parties married in City B on … 1993.  There are two children of the marriage: G born on … 2000 and now aged 13 (“G”) and H born on … 2002 and now aged 11 years (“H”).  G is currently in Grade 8 at I School and H is presently in Grade 6 at J School.  Both children live with Mrs Sturridge and spend time with Mr Sturridge by agreement. 

D.The parties separated in March 2011 when the Husband vacated the former matrimonial home at K Street, Suburb L (“the K Street property”). 

E.On 4 July 2008, the parties entered into a Financial Agreement (“the Financial Agreement”).  The parties agree that whilst the Wife did receive advice from an independent solicitor in relation to the terms of the Financial Agreement at the time, she did not fully understand the terms and the effect of the agreement on her rights.  As such, the parties have agreed that the Financial Agreement should be set aside and entered into a Termination Agreement to that effect.

F.The parties agree that the major assets of the marriage consist of the former matrimonial home at K Street, Suburb L which was valued at $1,580,000, and the Husband’s interest in D Pty Ltd.   The Husband and Wife have each obtained a valuation in respect of D Pty Ltd.  The mid-point value of those valuations is approximately $2,991,500.   In addition, the Husband, through the M Trust, also owns two parcels of land at 1 and 2 N Street, which were valued at a total of $1,635,000.   The parties also have some superannuation entitlements of comparable value.  

G.The assets of the marriage are encumbered by significant debt, which include losses arising from the purchase and subsequent sale of properties by the Husband at O Street and at N Street.  

H.The parties have now reached an agreement regarding property and maintenance matters (including the Husband’s financial support for the children), as reflected in these Orders and in the Financial Agreement and Binding Child Support Agreement which they also intend to sign contemporaneously with these Minutes.  Both parties accept that a deferred settlement, as provided for under these Orders, is the only realistic option to due to their present financial circumstances.   The deferred settlement provides that Husband continues to operate the D Pty Ltd business in order to raise sufficient funds to discharge the loans encumbering the former matrimonial home.  The deferred settlement also provides for the Husband to continue to provide financial support to the Wife pending the transfer of the former matrimonial home to her on an unencumbered basis.

1. For the purposes of these Orders, the parties agree that D Pty Ltd shall include D Pty Ltd (Aus),  D Pty Ltd (NZ) and any other business that the Husband conducts in the future in place of, or in connection with, D Pty Ltd.

BY CONSENT IT IS ORDERED

PARENTING

1. The parties shall have equal shared parental responsibility for the care, welfare and development of the children of the marriage, G born in 2000 (“G”) and H born in 2002 (“H”) (“the children”).

2. The children live with the Wife and spend time with the Husband by agreement between the parties and the children.

FINANCES

1. Within 7 days of the date of these Orders the Husband will pay or cause to be paid to the Wife the sum of $25,000 (“the payment”) and the Wife acknowledges that she has to date received $10,000 of the payment.

1. On 23 January 2025 or such earlier date as agreed between the parties (“the settlement date”), or upon the sale of D Pty Ltd (whichever occurs first), the Husband shall transfer to the Wife all his right, title and interest in the property situate and known as 38 K Street, Suburb L in the State of Victoria being the whole of the land described in Certificate of Title Volume … Folio … (“the K Street property”) free of encumbrance (“the transfer”).

1. Pending the transfer referred to in paragraph 4:

   (a)the Wife have sole and exclusive use and occupancy the K Street property; and

   (b)the Wife pay and indemnify the Husband in respect of all utilities and maintenance costs pertaining to the K Street property;

   (c)the Husband pay and indemnify the Wife in respect of all payments (interest and principal) in respect of the mortgage encumbering the K Street property, as well as rates, taxes and insurance costs in respect of the K Street property.

1. In the event that the Husband defaults on the payments on the mortgage in respect of the K Street property pursuant to paragraph (5)(c) above by more than two months (“default”), the Husband will do all such acts and things and sign all documents necessary put D Pty Ltd (or any other business in which he is engaged at that time, or any other assets in his name or control) and the properties owned by M Trust  on the market for sale (“the D Pty Ltd and M Trust sale”), and upon completion of the sale, to apply the proceeds as follows:

   (a)first in payment of all selling costs;

   (b)second to pay such amount to fully discharge the amount then outstanding on the mortgage secured over the K Street property, and thereafter transfer the K Street property to the Wife on an unencumbered basis;

   (c)thirdly any amount outstanding by way of rates or taxes in respect of the K Street property which was to be paid by the Husband pursuant to paragraph 5(c) above; and

   (d)the balance to the Husband.

2. In the event of default, then pending the D Pty Ltd and M Trust sale, the Husband shall do all such acts and things and sign all such documents necessary to transfer to the Wife, at his expense, 49 per cent of his shareholding in D Pty Ltd and direct such income from D Pty Ltd as necessary to enable her to meet the mortgage and other payments referred to at paragraph 5(c) above, including any arrears and interest charges and that the Husband shall pay and indemnify the Wife in relation to any liability arising in her name relating to the receipt of such payments or arising from the D Pty Ltd sale.

3. In the event the mortgage encumbering the K Street property is not fully discharged by the settlement date, the Husband will do all things and sign all documents necessary to discharge or refinance the balance of the mortgage encumbering the K Street property into his sole name and transfer the K Street property to the Wife, free of encumbrances.

1. Within 14 days of the date of these Orders the Husband shall do all acts and things necessary to cause a charge to be executed by D Pty Ltd (and in any other subsequent or related company in which the Husband conducts his business activities) in favour of the Wife in a form registrable on the Personal Properties Security Register as security for the transfer.

2. Pending the settlement date or the transfer, whichever is the later, the Husband will provide the Wife with not less than 21 days notice in writing in the event that he intends to dispose of his interest in the N Street land.

1. The Husband otherwise retain for his own use and benefit, to the exclusion of the Wife, all other assets and liabilities in his sole name, including but not limited to:

   (a)his motor vehicle;

   (b)funds in his bank accounts; and

   (c)chattels in his possession

   and the Husband shall pay and indemnify the Wife absolutely in relation to any past, present and/or future liability (including capital gains tax) of whatsoever nature and kind in relation thereto.

2. The Wife otherwise retain for her own use and benefit, to the exclusion of the Husband, all other assets and liabilities in her sole name, including but not limited to:

   (a)       her motor vehicle;

   (b)funds in her bank accounts; and

   (c)chattels in her possession

   and the Wife shall pay and indemnify the Husband absolutely in relation to any past, present and/or future liability (including capital gains tax) of whatsoever nature and kind in relation thereto.

1. Unless otherwise specified in these Orders and save for the purposes of enforcing any monies due under these or any subsequent Orders:

   (a)each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession of such party as at the date of these Orders;

   (b)the furniture be deemed to be in the possession of the party with whom they are held (with the chattels at the K Street property deemed to be in possession of the Wife);

   (c)monies standing to the credit of the parties are to become the property of the party in whose name the account is registered and any money held in joint bank accounts will become the property of the Husband;

   (d)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders;

   (e)each party retain their superannuation benefits;

   (f)insurance policies remain the sole property of the owner named thereon; and

   (g)any joint tenancy of the parties in any real or personal estate be hereby expressly severed.

IT IS FURTHER ORDERED THAT

1. All extant applications be otherwise dismissed and the matter removed from the list of pending cases awaiting hearing.

IT IS DIRECTED THAT
All subpoenaed and exhibited documents be returned on the usual basis to the person producing same.

AND THE COURT NOTES BY CONSENT THAT

A.Pursuant to Section 81 of the Family Law Act 1975 the parties intend that these Orders shall as far as practicable finally determine the financial relationship between them and avoid further proceedings between them.

B.The parties recognise that the children have experienced significant difficulty following their parents’ separation.  The parties have entered into a Parenting Plan which is annexed and marked “A”, which focuses on counselling for the parties and the children in order to address the significant problems between the children’s relationship with the Husband.

C.The parties have entered into a Binding Child Support Agreement contemporaneously with these Minutes, which is annexed and marked “B”, pursuant to which the Husband is to pay, in summary,  periodic child support as assessed by the Child Support Agency and the following non-periodic expenses:

(a)       Tuition fees;

(b)School expenses including uniforms and agreed camps;

(c)All expenses for extracurricular activities for the children; and

(d)All private health insurance levies and all out of pocket and gap medical and dental expenses.

D.It is also the parties’ intention that the Applicant will continue to pay for the children’s education and health insurance costs until both children attain the age of 21 years.

E.The parties have entered into a Binding Financial Agreement contemporaneously with these Minutes, which is annexed and marked “C”.

F.The Husband will ensure that he puts in place necessary arrangements to appoint Mr P Sturridge to administer his Estate to carry out his obligations pursuant to these Orders, the Financial Agreement and the Binding Child Support Agreement in the event of his death of incapacity.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Sturridge & Sturridge 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 MELBOURNE

FILE NUMBER: MLC 2901 of 2012

MS STURRIDGE

Applicant

And

MR STURRIDGE

Respondent

REASONS

1. The parties in this matter were married in 1993 and separated in March 2011.  There are two children of the marriage who are aged 13 and 11 respectively.  The husband operates a -manufacturing business and, whilst the parties each engaged experts to value the interest in that business, they have ultimately reached an agreement that that business should be valued at $2,991,500.  The other significant asset in what is the matrimonial pool of assets is the former matrimonial home which is valued at $1,580,000, subject to a mortgage of $207,000.  That property is also a security for other borrowings associated with the business. 

2. The total pool is approximately $5.1 million including superannuation, however the significant factor in this case, both as to the outcome and the way in which the orders are structured, is that the largest asset in that pool is the business which the husband inherited from his father.  That raises issues with respect to contributions.  It also means that the settlement pursuant to the proposed orders is to be a deferred settlement.  That deferred settlement also takes into account the wife’s limited income earning capacity and the fact that she has the primary care of the children of the marriage. 

3. The settlement provided for in the orders provides for the wife to retain the former matrimonial home, however the mortgage and the other business related security is to be finalised by 2025.  There are also provisions in the orders in the event that the husband fails to make any of the mortgage payments. 

4. The settlement, it is submitted, represents approximately a 67 per cent/33 per cent settlement in the husband’s favour, which takes into account the fact of his significantly greater contribution, but also has regard to the s 75(2) factors which are certainly weighed in the wife’s favour.

5. In all of the circumstances, I am satisfied that it is just and equitable to make orders and that the orders proposed are just and equitable.

I certify that the preceding five (5) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered on 13 September 2013.

Associate:

Date:  21 May 2014