Thorley and Greer & Ors

[2015] FamCA 213

FAMILY COURT OF AUSTRALIA

THORLEY & GREER AND ORS [2015] FamCA 213

FAMILY LAW – PROPERTY SETTLEMENT – De facto relationship – Where during the final hearing the applicant’s ancillary equity suit was compromised and her claim against the second and third respondents dismissed – Where the parties were ultimately in dispute about whether any alteration of their property and superannuation interests was required at all – Where the circumstances strongly imply the parties deliberately set about differentiating the way in which they accumulated their superannuation and property interests – Where the parties arranged their financial affairs so they had no joint proprietary interests – Where the evidence does not establish it would be just and equitable to adjust the existing property and superannuation interests of the parties – Both parties’ applications dismissed

Family Law Act 1975 (Cth), ss 90SM, 90SF, 90TA

Bevan & Bevan [2013] FamCAFC 116
Marriage of Coghlan (2005) 33 Fam LR 414
Stanfordv Stanford (2012) FLC 93-518

APPLICANT: Ms Thorley

FIRST RESPONDENT: Mr B Greer

SECOND RESPONDENT: Ms C Greer

THIRD RESPONDENT: D Pty Ltd

FILE NUMBER: SYC 2590 of 2012

DATE DELIVERED: 25 March 2015

PLACE DELIVERED: Newcastle

PLACE HEARD: Newcastle

JUDGMENT OF: Austin J

HEARING DATE: 9, 10, 11 & 13 March 2015

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Sharrock

SOLICITOR FOR THE APPLICANT: Manning Valley Legal and Conveyancing

COUNSEL FOR THE 1ST RESPONDENT: Mr Rugendyke

SOLICITOR FOR THE 1ST RESPONDENT: Boyd Olsen Lawyers

COUNSEL FOR THE 2ND RESPONDENT: Mr Bates

SOLICITOR FOR THE 2ND RESPONDENT:	Mark Graham Solicitor
COUNSEL FOR THE 3RD RESPONDENT:	Mr Bates

SOLICITOR FOR THE 3RD RESPONDENT: Mark Graham Solicitor

Orders

1. All existing interim orders are discharged.

2. All applications made by the applicant and first respondent for orders pursuant to Part VIIIAB of the Family Law Act are dismissed.

3. Costs are reserved for 28 days.

Notation

(A)Orders determining these proceedings as between the applicant, second respondent, and third respondent were made on 10 March 2015.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Thorley & Greer & Ors 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 NEWCASTLE

FILE NUMBER: SYC 2590 of 2012

Ms Thorley

Applicant

And

Mr B Greer

First Respondent

And

Ms C Greer

Second Respondent

And

D Pty Ltd 

Third Respondent

REASONS FOR JUDGMENT

Introduction

1. The former de facto relationship between the applicant and first respondent ended in late 2011. The applicant began these proceedings for property settlement, pursuant to Part VIIIAB of the Family Law Act 1975 (Cth) (“the Act”), some months later in May 2012.

2. The proceedings were complicated by the joinder of the second and third respondents to the litigation, as the applicant claimed she and the first respondent held an equitable interest in property in which those parties held legal interests. The resolution of that dispute, in exercise of the Court’s accrued jurisdiction, had the potential to significantly enlarge the amount of property amenable to distribution between the applicant and first respondent.

3. During the course of the final trial, the ancillary equity suit was compromised. The applicant’s claim against the second and third respondents was dismissed with no order as to costs and the trial then continued as an orthodox property settlement dispute between the applicant and first respondent.

4. The overall value of their existing property and superannuation interests was quite modest and the ambit of their dispute hardly justified maintenance of the litigation over the last couple of years.

Short history

1. The parties began their de facto relationship in late 1991, shortly after their respective marital separations. The respondent initially alleged the de facto relationship did not begin until 1994, but he was impelled to concede the accuracy of the applicant’s evidence when cross-examined.

2. Their relationship ended in late 2011. It is unnecessary to decide the minor controversy about whether the break down occurred in September or December of that year. The relationship therefore subsisted for approximately 20 years.

3. Various corporations and other legal entities permeated the parties’ lives. Despite clear concessions made by the applicant about those entities, which were pleaded as material facts for the purpose of her equity claim,[1] she appeared to misunderstand both the independent status of the entities and the property interests associated with them, so it is desirable to clarify such issues at this point.

   [1] Further Amended Initiating Application filed 13/10/14, Annexure A

4. The E Pty Ltd (“E”) was incorporated in June 1992 by the respondent’s parents. The corporation was originally named F Pty Ltd, but the name was changed in February 1996. The respondent’s parents were the sole directors of and shareholders in E.

5. In 1995 the applicant and respondent both began employment with E.[2] The parties worked hard to establish and conduct the business profitably,[3] but the business was undoubtedly owned by E. They were merely employees in the business, though the respondent held both an office and proprietary interest in E for a period of time.

   [2] Respondent’s affidavit, paras 20, 22

   [3] Applicant’s affidavit, paras 40,41, 43, 46, 47, 48

6. The respondent’s parents remained the sole directors of E until

   
   

   August 2002, at which point the respondent replaced his father as a director. The respondent’s mother resigned her directorship in December 2003, after which the respondent was sole director of E.

7. The shareholding in E remained vested in the respondent’s parents until later transferred to the beneficial ownership of the Greer Family Trust (“the Trust”) in August 2002. In November 2003, the Trust transferred the entire shareholding in E to the respondent, which he thereafter retained. The respondent gave no consideration for the transfer of shares to him,[4] which transfer amounted to a handsome gift.

   [4] Respondent’s affidavit, para 48

8. E sold its mortgage broking business to an unrelated third party in December 2007 for $2.5 million and then changed its name to G Pty Ltd.[5] It was de-registered in February 2009.

   [5] Applicant’s affidavit, paras 49-51; Respondent’s affidavit, paras 21, 72, 75, 76

9. H Pty Ltd (“H”) was incorporated in February 1988 by the respondent’s parents. The corporation was originally named I Pty Ltd, but the name was changed in January 1991. Save for a period of months during 1988, when the respondent and his former wife were the directors of and shareholders in H, the respondent’s parents were the only directors of and shareholders in it until about August 2002. Thereafter, until it was de-registered in January 2009, the respondent was the sole director of H and E was the sole shareholder in it.

10. The resultant effect of those transactions was that the respondent held sole control of both E and H from December 2003 until de-registration of both corporations in early 2009.

11. D Pty Ltd (“D”) is the trustee of the Trust. D was incorporated and the Trust was established in December 2001. The respondent has always been the sole shareholder in D and he and his mother have always been its only directors. The respondent’s two daughters and his prospective grandchildren are the beneficiaries of both the corpus and income of the Trust.[6] Sometime between 2002 and 2003, the applicant requested the respondent to ensure she was added as a beneficiary of the Trust, but the respondent consulted his parents and declined to make any changes.[7]

    [6] Respondent’s affidavit, para 36

    [7] Applicant’s affidavit, paras 121, 123, 125; Respondent’s affidavit, paras 50-51

12. J Pty Ltd (“J”) is the trustee of the Greer Superannuation Fund (“the Super Fund”). The parties are the sole directors of and shareholders in J. They are also the only beneficiaries of the Super Fund, which is a self-managed fund.[8] The Super Fund was established in March 2004,[9] not in 2003 as the applicant believed.[10]

    [8] Respondent’s affidavit, paras 9, 83

    [9] Exhibit R3, para 3

    [10] Applicant’s affidavit, para 60

13. Two parcels of rural real property were purchased during the parties’ relationship, which are relevant to their dispute.

14. The first property, known as “D Lodge”, was purchased by H in early 1992 with borrowed funds.[11] H later sold the property to D in 2002[12] and D held the property beneficially for the Trust, though E used its funds to service and discharge the mortgage secured over the property.[13]

    [11] Applicant’s affidavit, para 75

    [12] Applicant’s affidavit, para 118; Respondent’s affidavit, para 39

    [13] Applicant’s affidavit, paras 52(a), 59, 99, 100; Respondent’s affidavit, paras 40-42, 80.2

15. The parties used D Lodge for their recreation. They laboured hard and spent money on its improvement.[14] The applicant’s equity suit in these proceedings concerned her attempt to establish the parties’ equitable interest in the property, but her abandonment of the equity suit means legal ownership of D Lodge remains vested in D and beneficial ownership still rests with the Trust. The respondent has lived upon the property since moving there in December 2011.

    [14] Applicant’s affidavit, paras 77, 79, 88

16. The second property, known as “K”, was purchased by the parties jointly in 2003. The purchase was funded by money advanced to them by E and by an additional loan given by a mortgagee. E serviced the mortgage, at least in part.[15] In 2008, on advice from their accountant, the parties sold K to the Super Fund for $550,000. J then leased the property back to the parties for commercial use as a farm.[16] J’s purchase of K was enabled by E making an overall contribution of $570,000 to the Super Fund on behalf of the parties.[17]

    [15] Applicant’s affidavit, paras 16, 56, 59; Respondent’s affidavit, paras 43, 47, 53, 57, 58, 80.1

    [16] Applicant’s affidavit, paras 63-71; Respondent’s affidavit, paras 84-85, 101

    [17] Applicant’s affidavit, para 67; Respondent’s affidavit, paras 80.6, 82

17. J still holds legal title in K on trust beneficially for the Super Fund. The property remains leased to the parties, but the applicant has resided alone on the property since the respondent departed to live at D Lodge in December 2011. The applicant has the benefit of exclusive occupation of the property, subject to her fulfilment of conditions, pursuant to interim orders made on 26 June 2013.

18. Unfortunately, this litigation has been an intricate and expensive process for the parties. The proceedings were commenced in May 2012 but the parties were not ready to accept a date for final trial until October 2014 and so the dispute proceeded to final trial in March 2015.

The evidence

1. Following settlement of the equity dispute, the evidence relied upon by the parties was pared down.

2. The applicant relied upon:

   (a)Her affidavit filed on 7 February 2015;

   (b)Her financial statement filed on 7 February 2015; and

   (c)The affidavit of Ms L filed on 7 February 2015.

3. The respondent relied upon:

   (a)His affidavit filed on 10 February 2015;

   (b)His financial statement filed on 10 February 2015;

   (c)The affidavit of Mr M filed on 10 February 2015; and

   (d)The affidavit of Mr N filed on 10 February 2015.

4. Both parties successfully objected to large tranches of the other’s affidavits. The provisions of the Evidence Act 1995 (Cth) seemed to have only been of passing interest to those who drafted the affidavits.

Legal principles

1. Orders under the Act altering the property interests of parties may only be made if the Court is first satisfied it is just and equitable to make such orders. It is necessary to begin that inquiry by identifying the existing legal and equitable property interests of the parties. It must not be assumed the parties’ rights to or interests in property are or should be different from those that then exist, or that a party has the right to have the parties’ property divided by reference to the statutory considerations (see Stanfordv Stanford (2012) FLC 93-518).

2. Although the High Court was dealing in Stanford with an application between spouses for property settlement pursuant to Part VIII of the Act, the principles apply equally to applications between de facto partners pursuant to Part VIIIAB of the Act.

3. It is permissible for the factors prescribed by s 90SM(4) (the counterpart to s 79(4)) to inform the inquiry under s 90SM(3) (the counterpart to s 79(2)) of the Act about the justness and equity of making property settlement orders (see Bevan & Bevan [2013] FamCAFC 116 at [83]-[89], [163], [169], [171]-[172]).

4. If and once determined it is just and equitable for the property interests of the parties to be altered, the process of evaluating the proper orders to make is dictated by the factors enumerated within s 90SM(4) of the Act. The court must necessarily identify and assess the parties’ contributions within the meaning of ss 90SM(4)(a)-(c) and then take account of the relevant matters referred to in

   
   

   ss 90SM(4)(d)-(g) and 90SF(3) of the Act.

Existing property interests

1. During the trial the parties jointly tendered a document entitled “Balance Sheet”,[18] the contents of which superseded the financial circumstances to which the parties each deposed in their filed financial statements. The exhibit purported to summarise the ambit of their agreement and disagreement over the extent and value of their property interests, but by the time of final submissions their disagreement had dissolved.

   [18] Exhibit C

2. The exhibit is used as a template for the following findings, but the exhibit was not ultimately correct in some respects.

3. The applicant’s current legal and equitable property interests comprise:

No.	Assets	Value	Total
3	Plant and equipment at K	5,380
5	Livestock at K	601
6	4WD	30,000
7	Savings	100
Sub-total	36,081	36,081
Liabilities
16	Judgment debt (50 per cent)	12,500
17	Legal costs re debt (50 per cent)	2,500
Sub-total	15,000	15,000
Superannuation
18	Greer Super Fund interest	322,535	322,535
Net assets/resources	373,616

1. The respondent’s current legal and equitable property interests comprise:

No.	Assets	Value	Total
1	Plant and equipment at D Lodge	5,900
2	Tractor at D Lodge	58,000
8	Utility Vehicle	6,000
9	Part-share of horse	312
10	Guns	2,000
11	Savings	1,500
12	Part-share of sheep flock	400
Sub-total	74,112	74,112
Liabilities
16	Judgment debt (50 per cent)	12,500
17	Legal costs re debt (50 per cent)	2,500
Sub-total	15,000	15,000
Superannuation
19	Greer Super Fund interest	320,795	320,795
Net assets/resources	409,907

1. Some of the items appearing in and excised from the above schedules require explanation.

2. Items 4, 13, 14, and 15 on the exhibit were consensually deleted and are not to be considered as assets or liabilities of the parties.

3. Items 1, 2, and 3 on the exhibit were described as “joint” assets, but they are items of personal property that rest in the exclusive possession of one party or the other. Since both parties proposed orders that would vest sole ownership of all chattels in the party with current possession of them, neither actually presses a claim in respect of them. Those items are therefore shown in the schedules as belonging to the party who currently holds possession of them.

4. In circumstances where the value of any asset was disputed, the single expert valuation evidence was accepted, and in the absence of such expert evidence, the value ascribed to a chattel by the party with possession of it was accepted as an admission against interest.

5. Items 16 and 17 refer to unrelated litigation in which the parties were jointly involved as defendants. They suffered judgment against them and they are jointly (and probably also severally) liable for the judgment debt and the outstanding legal costs associated with the litigation. Half of each liability is therefore attributed to each party.

6. The valuations of items 18 and 19, being the parties’ respective interests in the Super Fund, are established by the evidence of their accountant, which was not controversial.[19]

   [19] Exhibit R3

7. The parties’ equal shareholdings in J are not included as assets because J only holds property on trust for the Super Fund. Similarly, the respondent’s sole shareholding in D is not included as an asset because D only holds property on trust for the Trust. Those shareholdings have no beneficial value.

8. The parties submitted their superannuation interests should be treated as property in the property adjustment process, even though that is not the orthodox approach (see Marriage of Coghlan (2005) 33 Fam LR 414 at 428-429). As I understood the submissions, it was contended a different approach was justified in the circumstances of this case because both parties are of an age that will shortly enable them to crystallise their superannuation interests as property and their superannuation interests are of comparable value.

Section 90sm(3)

1. It will be observed from comparison of the parties’ individual assets, liabilities, and financial resources, that they enjoy interests in assets and resources of roughly comparable value after their relationship of some 20 years.

2. The first inquiry, therefore, is whether justice and equity requires alteration of their current interests.

3. It eventually transpired the parties were in genuine dispute about whether any alteration of interests was required at all. That development was somewhat surprising because, until literally the last moments of the trial, the parties had always mutually adopted the view that a property settlement was warranted. The argument had been over the form the property settlement should take.

4. The respondent maintained his contention throughout that a property settlement would be just and equitable because his marginally greater property and superannuation interests did not commensurately reflect his significantly greater contributions to the parties’ wealth and the applicant’s past unilateral use of their assets.

5. The case conducted by the applicant was much more elliptical. She too had asserted that a property settlement would be just and equitable but, at the very end of final submissions, she contended for a result that would leave her with 43 per cent of the parties’ net assets and resources. Given that the combined net value of the parties’ assets and superannuation interests amounts to $783,523, the applicant’s retention of her existing assets and superannuation worth $373,616 means that she already holds 47.68 per cent of the parties’ wealth. Axiomatically, she argued for some property to be taken from her and given to the respondent. The absurdity of that situation after nearly three years of litigation needs no further elaboration. Once conscious of such reality, the applicant inferentially resiled from any application that would result in deprivation of her existing property and superannuation interests.

6. The respondent contended he was entitled to 80 per cent of the parties’ assets and superannuation interests. Since he already holds 52.32 per cent of the parties’ wealth, he effectively sought an adjustment in his favour of 27.68 per cent, amounting to $216,879.

7. The evidence does not establish that it would be just and equitable to adjust the existing property and superannuation interests of the parties. There are several reasons for that conclusion.

8. First, the applicant has net property of barely $20,000, which value comprises the net equity in her car. The respondent has net property of about $60,000, most of which value comprises a tractor. The respondent’s property is therefore three times more valuable and his principal asset is capable of being used for income-earning activities on the D Lodge farm where he does and will continue to live. The applicant’s car cannot be used in a similar way.

1. Secondly, the parties’ superannuation interests are of equivalent value. The difference in value is marginal. The circumstances under which their interests were quantified in that way are instructive, because it demonstrates how they set out to accumulate superannuation in a quite different way from their assets. It is clear they deliberately intended to accumulate equivalent superannuation entitlements in full knowledge of the respondent’s substantially superior capital contributions during their relationship.

2. The Super Fund comprises K and a number of shares in publicly-listed corporations. K is, by far, the most valuable asset of the Super Fund. The parties acquired K in 2003, but sold it to the Super Fund in 2008. Even though the parties were financially assisted by E to acquire K,[20] they deliberately chose to treat themselves as the exclusive legal and beneficial owners of K, with equal shares in it. They sold K to the Super Fund for $550,000 and each received $275,000, being one half of the sale proceeds. The funds that E contributed to the Super Fund to enable J’s purchase of K from them were also for their equivalent benefit.

   [20] Applicant’s affidavit, paras 16, 56, 59

3. E made that contribution to the Super Fund for the parties in 2008, at a time when the respondent was E’s sole director and shareholder. Most probably, in making those decisions for E, the respondent was motivated by his knowledge of how hard the applicant had worked to help establish and conduct E’s mortgage broking business from its inception in 1995 until its sale in December 2007.

4. In the early years of their relationship the parties worked together in the business known as “O Pty ltd”, but that business failed by 1995.[21] The parties then worked for E from 1995, building up its mortgage broking business. The respondent conceded E’s assets were meagre in 1995.[22] Together, the parties built E’s business from virtually nothing into a very valuable enterprise, such that it could be sold in December 2007 for $2.5 million.  

   [21] Applicant’s affidavit, paras 29-30; Respondent’s affidavit, paras 15, 18

   [22] Respondent’s affidavit, para 32

5. Neither party made any contribution to the Super Fund after the financial year ended on 30 June 2008,[23] so the intended equivalent monetary contribution by E for the parties during early 2008 was not later diluted.

   [23] Exhibit R3, para 6

6. The inference of intended equivalent contribution of funds to the Super Fund for the parties is only strengthened by the manner in which the funds were treated once received by the Super Fund.

7. J is the trustee of the Super Fund. The parties are the only directors of J. They are also the only shareholders in J. Their shareholdings are equal. Consequently, neither can exert independent control over the Super Fund. J segregated the contribution made by E to the Super Fund on the parties’ behalf in such a way as to ensure the equivalence of their interests. The acquisition of public shares by the Super Fund did not disturb the equivalence between the parties’ superannuation interests. The applicant’s interest still only exceeds the respondent’s interest in value by less than $2,000.

8. The segregation of the parties’ interests in that way by J must have been sanctioned by them, as they have always had equal control over J. The decisions about segregation of their individual superannuation interests were all made before the parties’ relationship broke down in December 2011. The last contribution to the Super Fund pre-dated June 2008 and the last financial statements compiled for the Super Fund relate to the financial year ended in June 2011.[24] Such decisions must therefore have been consensual.

   [24] Exhibit R3, paras 4, 6

9. Such circumstances strongly imply that the parties deliberately set about differentiating their superannuation interests from their assets. They intended that they have individual superannuation interests of equivalent value and regulated their affairs in such a way as to achieve that outcome. Those decisions were made by them only a few years ago, at a time when their respective retirements were clearly on the horizon.

10. By comparison, equivalent ownership of assets was not intended. D Lodge was intentionally acquired by H, even though the parties selected the property for purchase and later enjoyed the use of it. The decision was later consciously made for H to transfer D Lodge to D, to be held on trust for the beneficiaries of the Trust, which did not include either the applicant or respondent. The applicant wanted to be a beneficiary of the Trust, but the respondent thwarted it.

11. E conducted the business in which the parties worked between 1995 and 2007. The parties acquired no proprietary interest in the assets of E, including the business in which they were employed. Apart from payment of their wages, E favoured the parties with its largesse in other ways, such as by assisting their purchase of K in 2003.

12. Of the assets in which the parties chose to acquire either individual or joint proprietary interests, the respondent already holds the greater share. His assets outstrip the applicant’s assets in value by a factor of three, though their respective assets are of very modest value by comparison with their superannuation interests.

13. Thirdly, the parties arranged their financial affairs so they have no joint proprietary interests, meaning there is no imperative for adjustment orders severing joint interests.

14. Although items 1, 2 and 3 on the tendered balance sheet were described as “joint” assets, the epithet “joint” was merely a reflection of the fact they acquired such assets during the currency of their relationship. The parties do not treat them as jointly-owned assets and neither has any expectation of retaining any proprietary interest in a chattel in the possession of the other.

15. Items 16 and 17 are debts for which the parties are jointly (and presumably severally) liable, but their proportional liability for those debts will be dictated by the manner in which the judgment creditors enforce the debts against them. Even if property settlement orders were made between the parties in these proceedings, no order could be made definitively apportioning their individual liability for those debts. There is power to do so under Part VIIIAA of the Act in respect of former de facto partners, just as for spouses (s 90TA), but it would be procedurally unfair to the judgment creditors to use it because they did not seek joinder to the proceedings, were not joined to the proceedings, and were not given any opportunity to submit against such orders. Consequently, whether or not property settlement orders are made between the parties makes no difference to their residual joint liability for those debts.

16. Fourthly, aside from the manner in which the parties currently hold legal proprietary interest in their assets and beneficial interest in their superannuation, the respondent enjoys other privileges not enjoyed by the applicant. He will likely be favoured by continued free and unfettered use of D Lodge. He currently lives on that property, for which he pays no rent or occupation fee. He intends for that arrangement to continue indefinitely and he will probably have sufficient control to ensure it happens. D Lodge is owned by D on behalf of the Trust. The respondent remains the sole shareholder in D and he shares directorship of it with his elderly mother.

17. The applicant has no comparable benefit or resource. She lives on K, but K will need to be sold by J so the Super Fund has sufficient cash to enable either party, or both of them, to roll-out their superannuation entitlements to other compliant superannuation funds. The parties’ superannuation cannot presently be rolled-out, even though the values of their respective interests are already designated, because the combined value of their interests is reflected in the unrealised value of real estate. The applicant will need to vacate K to permit its sale, so she will be forced to find alternate accommodation. While ever she does reside there, unlike the respondent at D Lodge, she is required to pay commercial rent.

Conclusion

1. The failure of the parties to establish that it would be just and equitable to alter their property or superannuation interests necessarily means they will each retain their own assets, liabilities, and superannuation interests.

2. The parties will need to voluntarily segregate their individual interests, which can be easily achieved by:

   (a)Causing J to sell K, so that their segregated superannuation interests can be converted to liquid form;

   (b)Rolling-out their individual superannuation interests to other superannuation funds of their choice (whether one or both choose to do so will dictate what then becomes of J and the Super Fund);

   (c)Jointly discharging the debt and legal costs for which they are liable as a result of the unrelated litigation; and

   (d)Otherwise retaining the chattels which currently rest in their respective possession.

3. If the parties cannot reach agreement about the sale of K in order to permit extrication of their superannuation interests from the Super Fund it will be necessary for one to resort to remedies under the Corporations Act 2001 (Cth) (“Corporations Act”) to secure control of J or to place it in the independent hands of liquidators or administrators.

4. The respondent did seek orders for the liquidation of J,[25] but in quite different circumstances. He sought orders against the parties in personam, to facilitate implementation of the substantive property settlement orders he proposed, the power for which lay in Part VIIIAB of the Act. But since no property settlement orders are actually made, there is no power under the Act to make consequential orders compelling the parties to deal with their property and superannuation interests in particular way.

   [25] Exhibit R4, Orders 18.4, 19, 20

5. Orders of the type proposed by the respondent are conceptually different from an actual application for a corporate wind-up order under the Corporations Act. The Corporations Act specifies numerous grounds upon which such an order may be made and the Supreme Court (Corporations) Rules 1999 (NSW) prescribe the procedural manner in which wind-up applications should be made and the evidence required in support of such applications. None of those statutory and regulatory requirements were addressed in these proceedings.

6. In any event, it would be precipitous to compel the liquidation of J at this point, because the parties might agree to sell K, thereby avoiding the unnecessary cost of J’s forced liquidation. Besides, one party may prefer to individually maintain the structure comprising J and the Super Fund for future use.

7. The parties’ respective applications should therefore be dismissed. 

8. The applicant abandoned her application for those orders proposed in the Further Amended Initiating Application, filed on 13 October 2014, which were not already dismissed by the orders made on 10 March 2015. The applicant instead made an oral application for a superannuation splitting order of an unspecified magnitude, but in an amount determined by the Court to result in her retaining assets and a superannuation interest with a combined net value representing 43 per cent of the parties’ total assets and superannuation interests. To the extent that application was not also impliedly abandoned, it is dismissed.

9. The respondent abandoned his application for the orders proposed in the Further Amended Response, filed on 31 October 2014. The respondent instead sought the orders set out in the minute he tendered during final submissions.[26] That application is dismissed.

   [26] Exhibit R4

10. Interim orders, formerly made in June 2013, still regulate the applicant’s occupation of K. Those interim orders dissolve upon final orders being made dismissing all applications. If the applicant refuses to vacate K to permit its sale by J then entitlement to possession of K will be determined pursuant to the terms of the lease previously granted by J to the parties.

I certify that the preceding seventy seven (77) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Austin delivered on 25 March 2015.

Associate: 

Date:  25 March 2015