Tayfur & Tayfur

[2021] FCCA 1998

FEDERAL CIRCUIT COURT OF AUSTRALIA

Tayfur & Tayfur [2021] FCCA 1998

File number(s):	PAC 2240 of 2020
Judgment of:	JUDGE OBRADOVIC
Date of judgment:	26 August 2021
Catchwords:	FAMILY LAW – property – where each party seeks exclusive occupancy of the former matrimonial home – significant parental conflict – mother to have sole occupancy
Legislation:	Family Law Act 1975 (Cth), s.114
Cases cited:	Davis & Davis [1976] FamCA 38 Fedele & Fedele [1986] FamCA 14
Number of paragraphs:	34
Date of hearing:	19 August 2021
Place:	Parramatta
Counsel for the Applicant:	Ms Mahony
Solicitors for the Applicant:	Sharon Payne Family Lawyers
Counsel for the Respondent:	Mr Grew
Solicitors for the Respondent:	Coleman Greig Lawyers

ORDERS

PAC 2240 of 2020

BETWEEN:

MR TAYFUR

Applicant

AND:

MS TAYFUR

Respondent

ORDER MADE BY:	JUDGE OBRADOVIC
DATE OF ORDER:	26 AUGUST 2021

THE COURT ORDERS THAT:

(1)Pending further order, the respondent (“wife”) shall have exclusive occupation of the property located at B Street, Town C in the State of New South Wales (“Town C property”).

(2)Within 21 days, the applicant (“husband”) shall vacate the Town C property leaving it in good order and repair and subject to order (3) below, he shall thereafter be restrained from disturbing the wife’s exclusive occupation of the Town C property.

(3)The husband shall be at liberty to attend upon the Town C property for the sole purpose of accessing the two sheds located on the property, subject to the husband providing the wife 24 hours written notice of his intentions to use the sheds.

(4)The matter is listed for directions at 10am on 23 November 2021.

Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

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

REASONS FOR JUDGMENT

JUDGE OBRADOVIC:

Introduction

1. By way of Amended Application in a Case filed 2 February 2021, the husband seeks an order for exclusive occupancy of the parties’ former matrimonial home, located at B Street, Town C (“the Town C property”).

2. The wife opposes the husband’s application, and in response seeks an order that she have exclusive occupation of the Town C property.

3. To obtain an order for exclusive occupancy, a party must satisfy the Court that on balance, circumstances justifying the making of the order exists. The criteria for the exercise of the power under s.114(1) of the Family Law Act 1975 (Cth) is simply that the Court may make such order as it thinks proper. Matters which ought be considered include the means and needs of the parties, the needs of the children, hardship to either party, and where relevant the conduct of one party which may justify the other party in leaving the home: Davis & Davis [1976] FamCA 38 (“Davis”).

4. The authorities such as Davis which have set down useful guidelines on the application of s.114(1), should however only be treated as guidelines to assist in the proper exercise of the important discretion given under that section: Fedele & Fedele [1986] FamCA 14.

   Documents relied upon

5. The husband relied upon the following documents:

   a.His Amended Application filed 2 February 2021;

   b.His Affidavit filed 10 August 2021; and

   c.His Financial Statement filed 15 May 2020.

6. The wife relied upon the following documents:

   a.Her Amended Response to Initiating Application filed 8 March 2021;

   b.Her Affidavit filed 4 August 2021; and

   c.Her Financial Statement filed 2 July 2021.

   Relevant matters

7. The parties separated under the one roof in January 2019. They have one child together, X born 2017 (“X”).

8. It seems not to be disputed between the parties that at present, the husband spends each alternate weekend with X, and time before and after day care on a Tuesday. It also does not appear to be presently in dispute that the wife is and has always been the child’s primary carer. There are no interim parenting applications before the Court, although each of the parties seeks orders for parenting on a final basis. In any event, it does not seem to be in dispute, that whatever arrangement is agreed upon between the parties between now and when final parenting orders are made, that X will remain living with the wife for the majority of the time.

9. X attends day care 3 days per week, which is 10 minutes’ drive from the Town C property. The parties agree that they will each continue to pay a one half share of the child’s day care fees, pending X commencing school in 2022.

10. Each of the parties are in employment. The husband earns $150,000 per annum and the wife earns $141,050 per annum (although she does not work full-time).

11. The wife is employed as a professional at Employer D and she presently works from a home office, located within the Town C property, which has been set up to meet her work needs. The wife has worked from home since March 2020, and she works 4 days per week. The wife has a number of health concerns.

12. The wife is a member of Organisation E which is in Town C. The wife deposes to strong community ties in the Town C area, for example having gone to Town C Public School as a child, where X will commence in 2022.

13. The husband is employed on a full-time basis as a manager and he usually works away from the home at his employer’s place of business. The husband has a number of health concerns.

    The husband’s business

14. In 2013 the husband registered the company F Pty Ltd which trades under the business name Company F. The husband is a 50% shareholder in the business.

15. The company extracts annexed to the husband’s affidavit, show that the corporate entity G Pty Ltd was registered in October 2013, that it has 2 issued shares and 2 current directors, being the husband (who is also the company secretary) and Mr H.

16. The company extract reveals that the company has a judgment against it, in the amount of $10,684 issued on 10 October 2019. The company extract also shows that there was a strike-off action in progress in January 2019. None of this was explained in the husband’s affidavit. According to the company extract, the principal place of business of the company is I Road, Suburb J.

17. The husband also relied upon financial statements for the entity “G Trust”. Those financial statements appear to in fact show, that the business described in the Trust Tax Return 2020 as “Company K” is owned and operated through a unit trust “G Trust” which has a corporate trustee, namely F Pty Ltd. The directors of the corporate trustee are the husband and Mr H. The business name of the unit trust is noted as “G Trust”. There is no reference to any registered business name or any other business name used by the unit trust. The main business address of the unit trust is I Road, Suburb J.

18. The 2020 Trust Tax Return shows that the unit trust has a total of assets worth $6,882, and liabilities of $207,264. The business income for the 2020 financial year was $122,790 while the business expenses for the same period were $166,201. In 2020, the unit trust had a net loss of $43,411. The trust suffered losses in 2020, 2019 and 2016 financial years, bringing total losses over that period to $200,392. The Financial Statement for the unit trust of the year ended 30 June 2020, which form part of Exhibit 1, reflect the numbers in the tax return. The Financial Statement also makes it clear that the assets were made up of $5,000 worth of stock at hand and $1,882 being repayment of GST.

19. The Financial Statements for the unit trust for the year ended 30 June 2021 show a net profit of $46,292, but no distributions to either the husband or Mr H from those net profits. It appears that the husband loaned $15,388.50 to the trust in 2021. The total liability by the trust to the husband by way of beneficiary loans is $119,020. The unit trust holds a similar liability to Mr H. The unit trust had, as at 30 June 2021 $78,070 cash at bank, and $10,000 worth of stock. It also had accumulated losses of $154,090.

20. The husband’s financial statement sworn in May 2020, values F Pty Ltd at an estimated $2,500. The husband does not disclose in his financial statement the significant debt ($122,998 as at 30 June 2019, $103,631 as at 30 June 2020, and $119,020 as at 30 June 2021) that is owed to him by the unit trust. There is no explanation as to why there is no disclosure of this asset in his financial statement or in his affidavit relied upon at the interim hearing. There is no evidence as to the terms of these beneficiary loans, and when and if the husband will call on them.

21. The evidence of the husband is that the company “holds two major ongoing contracts”. Annexed to his affidavit is a contract with Company L which has been extended to 2023, and a letter of extension of contract with Company M for a period of 12 months from 19 April 2018. Therefore, at best it appears that the business has a contract with Company L. The “Deed of Standing Offer” said to be between Company L and F Pty Ltd, commenced on 1 December 2014 for a period of 6 years, and was then apparently extended for 3 years to 1 December 2023. The letter purporting to extend the Deed of Standing Offer is undated and unsigned and it is addressed to the business address where the business had not operated, according to the husband, since 2015. The value of that contract is unknown. In any event, even if it has been in place since December 2014 the trust has recorded losses since the 2016 financial year (there are no company returns in the husband’s evidence).  According to the wife’s evidence, the Company L contract was cancelled in 2019.

22. The business, according to the husband, has its stock stored in the two sheds located at the Town C property. One of the sheds was, the husband deposes, purpose built in 2019 for the business, at a cost of $90,000, while the other shed was already on the property and utilised by the business.  It is entirely unclear what the source of funds for the erection of the second shed was, although there is some evidence that the unit trust expended $73,622 on leasehold improvements. There is no evidence of any agreement between the parties and the business (unit trust or the trustee company) as to any improvements to the Town C property which might have been made by the business.

23. The wife says that the new shed was constructed by the parties as a multi-space for the family, and that the construction of the new shed is not completed. According to the wife, the new shed stores some furniture, baby clothing, and equipment that the parties’ child has grown out of and a two person kayak. Furthermore, the wife says that the old shed holds the husband’s tools, some furniture, the ride on mower and stock of the company, which takes up no more than half the available space.

24. The husband says the reason why the Town C property was purchased in the wife’s sole name is because at the time he was involved in a legal dispute with respect to a new business he had started. No further details are provided by the husband about the business or the nature of the dispute. The wife says that in about 2014, the husband and Mr H were sued by their former employer for an alleged breach of contract, and that subsequent to a settlement that was reached the husband paid approximately $70,000 in damages.

25. Between 2013 and 2015, according to the husband, the company was run from rented premise at a cost of $4,000 per month. Since the purchase of the Town C property, the business has run from the property. The business does not pay any rent to the parties for its use of the two sheds located on the property, nor is it proposed that it do so in the future. There is no explanation in the husband’s case as to why the business is continuing to operate from the Town C property without paying any rent to the parties. On 15 March 2021, the wife requested that the company commence paying rent. No response to that request has been received.

26. The husband says that he needs 24 hour access to the two sheds in order to run the business. This is notwithstanding that he spends only between 4-20 hours per week in running the business.

27. The wife says in support of her application for exclusive occupancy, that she will grant the husband access to the sheds on 24 hours’ notice for the purpose of the husband operating the business. There is no evidence which would suggest that this amount of notice is insufficient for the husband to take deliveries or to do anything else that the business requires, there is only the husband’s opinion for which the basis is not explained. The husband simply asserts that he requires “immediate access” to the shed in order to accept deliveries, for auditing of premises by government bodies, for attending to emergency breakdowns and repairs and for servicing of tooling and supplies.

    Determination as to exclusive occupancy

28. The parties agree that the conflict between them is so significant that continuing to live separated under the one roof is simply not a tenable solution.

29. The husband’s case is that the wife can move out with the parties’ child and live at the home of her mother on an interim basis. The wife says that her mother’s home is not appropriate long term accommodation for her and the parties’ child. There is evidence that a rental property in the area where the parties currently reside, of similar nature to the Town C property, would cost between $700 and $980 per week, which on the evidence each of the parties would be able to afford.

30. Each of the parties seeks an order on a final basis that they remain living in the Town C property and that there be an adjustment in the other party’s favour. The Town C property is the subject of a mortgage, and each of the parties has the capacity to meet the entirety of the mortgage repayments. It was conceded at the hearing by each of the parties that whoever remains living in the property will be solely responsible for the mortgage, pending the final hearing. The mortgage repayments are $1946 per month.

31. The husband wants the wife and the child to move out of the former matrimonial home so he can ostensibly run his business from the Town C property. In essence, the Court is being asked to exercise its discretion in favour of an unprofitable corporate entity over the interest of the wife and the parties’ only child.  

32. The Court does not accept the submissions made on behalf of the husband that his business operations would be significantly impacted by the granting of the wife’s application for exclusive occupancy. The wife is proposing to allow the husband access to the sheds on 24 hours’ notice.

33. Having regard to the needs of the parties’ child, the capacity of the parties to pay for alternate accommodation (noting the husband’s higher income and therefore greater financial capacity), the needs of the parties, and any stated hardship which may be suffered by either of them, on balance and in the exercise of the Court’s discretion, it is proper that an injunction be made for the wife to have sole and exclusive occupancy of the Town C property.

34. For all of those reasons, orders as set out at the forefront of these Reasons for Judgement will be made.

35          I certify that the preceding thirty-four (34) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Obradovic.

Associate:

Dated: 26 August 2021