Teh and Muir (No. 2)

[2014] FamCA 960

FAMILY COURT OF AUSTRALIA

TEH & MUIR (NO. 2) [2014] FamCA 960

FAMILY LAW – PROPERTY – Interim Orders – where wife seeks interim property distribution to fund litigation – interim distribution to be sourced from proceeds of real property currently held in trust account – where wife’s entitlement to proceeds of sale are dependent on wife’s application to enforce a Binding Financial Agreement – orders made for the wife to access funds provided she first obtain the written consent of the respondent husband’s legal guardian.

Family Law Act 1975 (Cth) ss 75(2), 79, 80

APPLICANT: Ms Teh

RESPONDENT: Mr Muir by Ms Becke (Case Guardian)

INDEPENDENT CHILDREN’S LAWYER:

FILE NUMBER: ADC 1922 of 2014

DATE DELIVERED: 30 October 2014

PLACE DELIVERED: Adelaide

PLACE HEARD: Adelaide

JUDGMENT OF: Dawe J

HEARING DATE: 30 October 2014

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Finlayson

SOLICITOR FOR THE APPLICANT: Greg Finlayson Lawyers

COUNSEL FOR THE RESPONDENT AND CASE GUARDIAN: Ms Hurley

SOLICITOR FOR THE RESPONDENT AND CASE GUARDIAN: Culshaw Miller Divorce & Family Lawyers

Orders

(1)The Application in a Case filed by the Applicant Wife on 12 August 2014 is dismissed.

(2)Further pursuant to paragraph 4 of the Orders made by this Honourable Court on 25 June 2014 within fourteen [14] days the Applicant Wife do provide all statements dated 1 January 2014 to 15 October 2014 in respect of any bank accounts in her name or in the name of her son MR TEH (also known as …) such statements to include (but not limited to) the following accounts:

(2.1)       NAB accounts numbered:

(2.1.1)     …324;

(2.1.2)     …285;

(2.1.3)     …724;

(2.1.4)     …543;

(2.1.5)     and any other NAB account(s) not yet disclosed;

(2.2)ANZ account(s) disclosed to the Migration Review Tribunal in the name of Ms Teh and Mr Teh;

(2.3)HSBC account(s) disclosed to the Migration Review Tribunal in the name of Ms Teh;

(2.4)Bendigo Bank account(s).

(3)Paragraph 5 of the Orders made by this Honourable Court on 25 June 2014 is amended to read:

5.The applicant wife is restrained and an injunction is hereby granted restraining her from dealing with, disposing of, withdrawing or in any way transacting any funds held in any bank account (including any draw down facility) in the name of the applicant wife, such account held either jointly with another or in the applicant wife’s sole name SAVE AND EXCEPT funds required for the applicant wife’s day to day needs or legal expenses or with the prior written consent of the respondent husband’s legal guardian.

(4)The question of costs is reserved to the final hearing.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Teh & Muir (No. 2) 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 ADELAIDE

FILE NUMBER: ADC 1922 of 2014

Ms Teh

Applicant

And

Mr Muir (Ms Becke – Case Guardian)

Respondent

EX TEMPORE REASONS FOR JUDGMENT

1.The proceedings before me I will describe the parties as the “wife” and the “husband”.  This is not making any finding that there was any de facto relationship;  it is just a simple method of referring to the parties rather than using their names. 

2.The Initiating Application filed on 29 May 2014 sought final orders to enforce the Binding Financial Agreement dated 19 February 2014, and interim orders in relation to caveats and injunctions.  An amended Initiating Application filed on 2 June 2014 sought similar orders in relation to the order to enforce the Binding Financial Agreement, but also sought final orders:

The applicant receives a fifty-fifty per cent of property settlement in accordance with the Binding Financial Agreement, and further interim orders including injunctions in relation to the [I Street, Suburb A] property.

3.The Response to the Initiating Application opposed the orders sought, sought an order that the Binding Financial Agreement be set aside and that the net proceeds of sale of the property be paid to the husband.  Affidavits were filed in relation to the interim orders sought.  I dealt with those matters on the first occasion by the judgment which was delivered on 25 June 2014 in which there was discussion concerning the basis upon which it is sought to set aside the Binding Financial Agreement, including the allegation that the husband did not have the appropriate capacity to enter into the Binding Financial Agreement.

4.The proceedings on behalf of the husband are being conducted by the legal guardian, his daughter, who has been appointed under the appropriate state law.  There are only minor changes to the factual matters which come with the Application in a Case filed by the wife in August this year in which the wife seeks orders for the funds held by the husband’s guardian’s lawyers pursuant to the orders of 25 June 2014, namely that $40,000 be transferred to the trust account of the applicant’s solicitors on account of the applicant’s legal fees, and that the husband pay the sum of $730.20 per fortnight until further order by way of urgent interim maintenance.

5.That order is opposed on behalf of the husband.  Orders are sought in relation to the provision of further information concerning the disclosure of bank accounts. 

6.This matter needs to be seen in light of the allegations that are being made and the need to ensure that any order made for what could be considered distribution of the funds which would form part of the property settlement (and therefore an interim property settlement order) is made in accordance with the provisions of the Family Law Act 1975 (Cth) (“the Act”). In particular the need to consider the requirement that, as emphasised in the recent High Court proceedings, that any order, and the making of any order, must be just and equitable in the circumstances.

7.It is also necessary to take into consideration the provisions of section 79 and section 75(2). In this matter the considerable factor is that if the wife is successful in maintaining the Binding Financial Agreement she would certainly on the face of it be entitled to a division of the assets of the parties. However, as to the assets of the parties, there also remains a dispute as to whether that is more than the net funds currently held in the trust account, being the $87,000 as well as the $40,000 which has already been distributed to the husband. On behalf of the husband it is being argued that the wife has not accounted for some $30,000 which has, it is alleged, been removed by her from the husband’s accounts.

8.In relation to the Binding Financial Agreement, however, it is also alleged and maintained that that should be set aside, not only on the basis that the husband did not have the proper legal capacity to enter into any such agreement in February 2014, but also that there was no de facto relationship at the time the agreement was entered into, nor had there been at any time, and that the wife has failed to disclose necessary assets at the time of making the alleged Binding Financial Agreement which would in itself set aside that agreement. 

9.These are significant matters which have to be determined.  Taking into account that it is clear that the husband owned the property (which has been sold and now the net proceeds invested) the husband would be entitled to a significant portion at least of the funds from the sale of that property.

10.However, the Court is simply not able to make the same sort of assumption in relation to the wife’s entitlement because of the significant issues that have to be determined.  Therefore there is a need to consider whether making any order by way of distribution of funds to the wife for legal fees would be just and equitable taking into account all of the circumstances. 

11.If the husband’s case brought by his guardian is successful then the wife would not be entitled to any share of the proceeds of sale of the property which has been sold.

12.The wife’s case appears to be that the funds would be used for living expenses and legal expenses for these proceedings, other proceedings before the Migration Review Tribunal and in relation to other claims concerning proceedings against the husband in relation to other civil proceedings to claim funds on behalf of her son. 

13.In those circumstances, it would appear that the funds could not be recovered or an appropriate adjustment made which would bring about an overall result if the husband were successful in his proceedings.

14.Taking into account, therefore, the need to be satisfied that any order would be just and equitable, I am not satisfied that any further order by way of interim order would be just and equitable in these circumstances. If I am wrong on that, then taking into account all of the factors contained in the provisions concerning section 79 and section 80, I am not satisfied that those provisions would also make it just and equitable for there to be any payment by way of interim distribution at this time to the wife.

15.In relation to the authorities which have been provided concerning the question of Mareva injunctions and interlocutory relief, I take those into account.  They support the preservation of the assets without distribution to the wife, rather than at this stage promoting a distribution to the wife. 

16.In relation to the application for maintenance of the wife, there are again issues to be determined.  The first is whether there was a de facto relationship which would make her entitled to have any order for maintenance, whether interim or final.  The second, would be the needs of the wife and her capacity to support herself, and most significantly in this matter, the capacity of the husband to provide for her by way of maintenance. 

17.The information concerning the wife now indicates that she has found some employment, although on the face of it currently not sufficient to support herself.  This indicates that she has the capacity to obtain employment, notwithstanding the ongoing proceedings in relation to the migration issues.  The significant factor, however, is that the wife has failed to establish that the husband, who is in care and being provided for by way of limited funds, has the capacity to make any payment by way of urgent or interim spousal maintenance. 

18.I dismiss the Application in a Case by the wife in relation to the issue concerning the production of documents which was dealt with in the response filed by the husband. 

19.The Application in a Case brought by the wife filed on 12 August 2014 is therefore dismissed.

20.I also make an order in terms of paragraph 3 of the response to the Application in a Case, being the response filed on 16 October 2014.  In relation to the injunctions which I previously made, I indicated during discussion with counsel that if there were funds that otherwise belonged to the wife and she wished to use those funds for legal expenses in relation to these proceedings and other legal proceedings, I consider that that would be appropriate, bearing in mind the bulk of the funds are still retained in the husband’s lawyer’s trust account. 

21.I therefore amend paragraph 5 of my order of 25 June 2014 to add in the words where it says “save and except funds required for the applicant wife’s day-to-day needs”, add in “or legal expenses” and then “or with the prior written consent of the respondent husband’s legal guardian.”  So I am adding after the words “day-to-day needs” the words “all legal expenses”. 

I certify that the preceding twenty-one (21) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Dawe delivered on 30 October 2014.

Associate: 

Date:  7 November 2014