Surry and Surry (No 2)

[2019] FamCA 809

FAMILY COURT OF AUSTRALIA

SURRY & SURRY (NO. 2) [2019] FamCA 809

FAMILY LAW – PROPERTY – final orders arising from further submissions – former family home to be sold by Mortgagee in Possession – very modest remaining pool

Family Law Act 1975
APPLICANT:	Mr Surry

RESPONDENT: Ms Surry

FILE NUMBER: BRC 12807 of 2016

DATE DELIVERED: 11 November 2019

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Baumann J

HEARING DATE: 21 May 2019 and 28 October 2019

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms D Wardle
(21 May 2019 only)

SOLICITOR FOR THE APPLICANT:

Ms D Hanslow-Hastie

DME Law

THE RESPONDENT: No appearance

Orders

Superannuation

1. That the wife hereby relinquishes all current entitlements, benefits and any future right or benefit in the husband’s superannuation entitlements (whether by way of employer funded schemes or private superannuation policies of schemes) which shall then become the absolute property of the husband.

2. That the husband relinquishes all current entitlements, benefits and any future right or benefit in the wife’s superannuation entitlements (whether by way of employer funded schemes or private superannuation policies of schemes) which shall then become the absolute property of the wife.

Businesses

1. That within fourteen (14) days of the date of these Orders:

   (a)The wife and husband shall do all acts and sign all documents as are necessary to transfer to the Applicant, at the expense of the husband, all of the wife’s right title and interest in the Surry Family Trust trading as CC Business at Town DD ABN ….

2. That contemporaneously with the completion of Order 3. above:

   (a)the husband shall release the wife from all personal covenants, guarantees and any claim, demand, or action made against the wife howsoever arsing in respect of the past and future operation of CC Business at Town DD ABN …. and the husband shall indemnify and keep indemnified the wife from all liability howsoever arising therein;

   (b)the husband shall indemnify and keep indemnified the wife against all actions, claims or demands by the Deputy Commissioner of Taxation in relation to any tax liability (whether income tax, capital gains tax, goods and services tax or fringe benefits tax) which the wife may incur or have incurred by way of assessments, reassessments, penalties or interest on tax, howsoever arising in respect of the operation of CC Business at Town DD ABN ….

Suburb S property

1. That noting that the current Mortgagee is in possession of the property at R Street, Suburb S and is effecting a sale of the said property:

   (a)the parties will cooperate with the Mortgagee in Possession to support the said sale at the best market price obtainable;

   (b)upon sale, after discharge of all secured loans (including business loans), any nett proceeds are to be divided equally between the parties;

   (c)if the sale proceeds are not sufficient to satisfy all the outstanding loans then:

   (i)the wife shall indemnify the husband in respect of any deficiency, as certified by the bank, in respect of the housing loan account number …14; and

   (ii)the husband shall indemnify the wife in respect of any deficiency, as certified by the bank, in respect of the business loans account numbers …04 and …64.

2. That the wife and husband shall retain any motor vehicle currently in their possession. The wife and husband will do all acts and sign all documents as are necessary to transfer to the other party, at the expense of the party who is to retain that particular motor vehicle, all right and interest in that particular motor vehicle.

3. That unless otherwise specified in these orders, it is declared that:

   (a)each party be solely entitled to the exclusion of the other to all other property and chattels of whatsoever nature and kind in the possession of such party as at the date of these orders and for this purpose:

   (i)real properties shall be deemed to be in the possession of the person whose name appears on the title of the property;

   (ii)bank accounts are deemed to be in the possession of the person whose name appears on the bank record thereof;

   (iii)insurance policies (if any) are deemed to be in the possession of the beneficiary thereof;

   (iv)superannuation entitlements are deemed to be in the possession of the person who is named as the worker or whose age or working future provides the conditions for payment out of such entitlements; and

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

4. That the transferee spouse shall prepare any documents necessary to give effect to the provision of these orders at their cost and further be responsible for the payment of registration fees (if any) in relation to the transfer of any properties into their name.

5. That any stamp duty payable on transactions arriving from these orders or any document executed pursuant to these orders be paid by the transferee spouse.

6. That the parties shall comply promptly with all requisitions issued by the Office of State Revenue, Land Titles, Main Roads Department and any other government department in relation to any document executed or transacted pursuant to or put into effect the terms and conditions of these orders.

7. That in default of either of the parties hereto complying with any requisition so issued within fourteen (14) days of the date upon which any requisition issues, the party not in default shall be entitled to comply with any of the said outstanding requisitions and recover from the other party in default the costs and outlays incurred in complying with any of the said requisitions which such costs to be calculated in accordance with the Family Law Rules.

8. That the parties shall sign, execute and deliver all such documents, instruments and writings and shall do all such other acts and things as may be necessary or desirable to give full force and effect of these orders. Should either party default in signing or executing such documents required to give effect to any provision of these Orders, then a Registrar of the Family Court of Australia at Brisbane shall be empowered and is hereby irrevocably empowered to sign and execute documents in lieu of the defaulting party or parties pursuant to section 106A of the Family Law Act 1975.

9. That the husband will be responsible for the payments for PP Bank, Visa Card, loans to parents.

10. That all other pending Applications are dismissed.

Note: The form of the order is subject to the entry of the order in the Court’s records.

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

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT BRISBANE

FILE NUMBER: BRC 12807 of 2016

Mr Surry

Applicant

And

Ms Surry

Respondent

REASONS FOR JUDGMENT

1. On 18 September 2019 I delivered Reasons in this matter and pronounced final parenting Orders.

2. In respect of the property proceedings having considered the evidence available at the time of the hearing before me, I found that a divisible pool of assets of $313,085 existed (see paragraph 76) however in circumstances where the Court was uncertain as to how the sale of the home, then occupied by the wife, was to be achieved, further submissions were necessary.

3. The “notional” division and alteration of property interests set out in paragraph 89, was based on:

   a)the husband, as was his case, before me, discharging the business loans and then retaining the business entirely; and

   b)the nett proceeds of sale of the home (calculated to be $120,000), being divided equally between the parties.

4. Since the delivery of Reasons, the further evidence that has been offered which the Court now needs to take into account, includes:

   a)the husband submitted that he would not seek to retain the home, but would allow (and expected) the Mortgagee MM Bank to now take possession of the home and effect a sale;

   b)the husband, who had ceased making any payments on the housing loan had continued to make payments on the business loans, also secured over the home;

   c)the Mortgagee has now taken possession of the former matrimonial home and the wife who had occupied the home “effectively rent free”, has vacated the home;

   d)on 30 October 2019, the solicitors for the husband (as directed by the Court) provided to the Court (and the letter has been marked as an exhibit in these proceedings), a letter from the solicitor for the Mortgagee in Possession, setting out the current loan balances as well as a copy of the loan statement for housing loan …14, for the period from 1 October 2018 to 21 October 2019;

   e)the further evidence reveals that:

   i)the husband has continued to make repayments on the business loan and at the time of the hearing, the balance on the loan stood at approximately $72,000 and is now $69,331;

   ii)as anticipated by the husband, the wife failed to make any payments on the housing loan (save for one payment of $230 on 8 October 2018) such that the loan balance (after that payment) stood at $177,744 but has now increased through interest and legal expenses of the Mortgagee to $202,067;

   iii)the bank confirmed that:

   “the bank is incurring ongoing costs for removal and storage of items from the property, preparation of the property for sale and putting the property on the market, including legal costs. Not all these costs may yet have accrued to the accounts or be included in the numbers above.  This may entail that significant further costs accrue to the accounts before the property is sold”.

5. The result sadly is that it is more likely than not, that the home will be sold by the Mortgagee in Possession at a level barely covering the outstanding loans.  In fact, there could be a deficit.

6. In considering what orders do justice and equity to both parties in the circumstances which now exist, which are quite different to those discussed in the earlier Reasons for Judgment where a nett return of $60,000 from the home sale to each party was notionally anticipated, the Court pronounces the orders which appear at the commencement of these Orders.

7. The effect of the Orders is that the husband will retain the small business without the bank loan, his superannuation and his motor bike.  The wife will leave the relationship with very little, save for her superannuation.

8. Is this just and equitable to the wife? I have formed the view that it is when account is taken of:

   a)the increase in the housing loan due to the failure of the wife to make payments;

   b)the increase in the housing loan by reason of the need to sell the home, registered in the wife’s name solely, through legal expenses occasioned by the wife’s default;

   c)the fact that the husband has maintained the business throughout and has incurred significant further legal expenses in both the parenting and property proceedings as a result of the wife’s bizarre conduct. There is a reasonable prospect that the husband would be entitled to seek some form of costs order from the wife (because of her conduct, a factor under s 177(2A) of the Family Law Act 1975), however he will never be in a position to recover funds from the wife; and

   d)the husband, as the father of the two young girls meets the entirety of the children’s financial and emotional needs (which included extensive counselling for them after the events of November 2018), and is likely to do so for the rest of their infancy.

9. The wife, on the other hand, is free to pursue her financial future as she wishes.

10. I make the Orders which appear at the commencement of these Reasons, which now finalise all proceedings between the parties at this time.

I certify that the preceding ten (10) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Baumann delivered on 11 November 2019.

Associate: 

Date:  11 November 2019