FAMILY COURT OF AUSTRALIA
| TILSTON & TILSTON AND ORS | [2020] FamCA 857 |
| FAMILY LAW – JURISDICTION – Where the husband and wife seek a property settlement order – Whether the Court has jurisdiction to determine claims made by the son against the husband for misleading and deceptive conduct or alternatively for breach of fiduciary duty – Consideration of the term ‘accrued jurisdiction’ – Where the claim by the son against the husband arises out of a “common substratum of facts” and there is a “single justiciable controversy” and the Court therefore has authority to adjudicate all issues comprising the matter. CONSUMER LAW – Where the son alleges that the husband has engaged in misleading and deceptive conduct pursuant to s 18 of the Competition and Consumer Act 2010 (Cth) relating the family partnership, trust and superannuation fund – Where it is found that the husband has not engaged in misleading and deceptive conduct. DAMAGES – Discount for contingencies – Where if the Court had found that the husband had engaged in misleading and deceptive conduct a 50% discount to the sum of damages to be awarded to take into account contingencies would have been appropriate. FIDICUARY DUTIES – Where the son alleges that the husband has breached his fiduciary duties as a partner of the family partnership and as a trustee for the family superannuation fund – Where the son’s claim is without foundation. SUPERANNUATION – Where the husband has an interest in a Defence Force Retirement and Death Benefit (“DFRDB”) Pension – Consideration of the approach to be adopted. PROPERTY SETTLEMENT – Contributions – Where the husband concedes that contributions should be assessed as favouring the wife by up to the proportion 55/45 – Where the wife contends that contributions should be assessed as favouring her in the proportion 55/45 and that she should receive an adjustment of a further five percent such that she receive 60% of all assets (except for the capitalised value of the husband’s DFRDB pension) – Where an order is made which divides the property pool, comprising all bar the husband’s DFRDB pension, in the proportion of 57.5% to the wife and 42.5% to the husband. |
| Family Law Act 1975 (Cth) Competition and Consumer Act 2010 (Cth) |
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- AGLC
- Tilston and Tilston & Ors [2020] FamCA 857
- Case
- [2020] FamCA 857
- Decision Date
CaseChat Overview and Summary
The primary legal issues before the Court were whether it possessed jurisdiction to hear the son's claims against the husband, given that these claims arose from consumer law and fiduciary duty allegations rather than directly from the marital relationship. The Court also had to determine the extent of the husband's alleged misleading and deceptive conduct and breaches of fiduciary duty, and if found, the appropriate discount for contingencies in any damages awarded. Finally, the Court was required to determine the division of the parties' property pool, including various family entities and assets, and to consider the approach to valuing and dividing the husband's Defence Force Retirement and Death Benefit pension.
Carew J found that the Court had jurisdiction to hear the son's claims under its accrued jurisdiction, as these claims arose from a common substratum of facts and constituted a single justiciable controversy alongside the property settlement proceedings. However, the Court ultimately dismissed the son's claims, finding no evidence of misleading or deceptive conduct by the husband, nor any foundation for the allegations of breach of fiduciary duty. In relation to the property settlement, the Court ordered a division of the property pool, excluding the husband's DFRDB pension, in the proportion of 57.5% to the wife and 42.5% to the husband, reflecting a concession by the husband regarding contributions and an adjustment sought by the wife.
The Court made detailed orders for the disbursement of funds, the distribution of assets from the Tilston Family Trust and the C Partnership, and the winding up of the Tilston Family Superannuation Fund. Specific provisions were also made for the division of an E Holiday Membership, the return of certain jewellery, and the retention of various other assets and liabilities by each party. The Court also authorised a Registrar to execute documents if a party failed to do so, and addressed the issue of costs and liberty to apply.
Orders
Orders of the court
IT IS ORDERED THAT:
CLAIM BY THIRD RESPONDENT
1. The claim by the third respondent against the first respondent (“the husband”) as contained in the Response to Initiating Application filed 11 February 2020 and amended by the Case Outline filed 21 August 2020 be dismissed.
DISBURSEMENT OF FUNDS HELD BY THE TRUSTEE FOR SALE
2. The applicant (“wife”), husband, second respondent and third respondent (collectively “the parties”) instruct the Trustee for Sale to disburse the funds held on trust by him on behalf of the parties as follows:
2. (a) to the Tilston Family Trust, the sum of $1,192,733;
2. (b) to the Tilston Family Superannuation Fund CBA Account No. …25, the sum of $574,492;
2. (c) to the C Partnership CBA Account No. …86, the sum of $178,130.75; and
2. (d) the balance, equally between the husband and the wife by way of payment of:
2. (i) 50% to the trust account for the lawyers for the wife; and
2. (ii) 50% to the trust account for the lawyers for the husband.
THE TILSTON FAMILY TRUST
3. The husband cause D Pty Ltd as trustee for the Tilston Family Trust to do all acts and things and sign all documents necessary to distribute the assets of the Tilston Family Trust between the husband and the wife in the most tax effective way so as to achieve a distribution of all assets listed in the attached schedule in the proportion 57.5% to the wife and 42.5% to the husband.
4. The husband and wife do all acts and things and sign all documents necessary to wind up the Tilston Family Trust, with the costs of same to be shared equally between the husband and the wife.
THE TILSTON FAMILY SUPERANNUATION FUND
5. In respect of the Tilston Family Superannuation Fund, each of the parties is to:
5. (a) Forthwith do all acts and things and sign all documents required to transfer their respective member entitlements out of that fund and into another superannuation fund of that party’s nomination; and
5. (b) Do all acts and things and sign all documents required to wind up the Tilston Family Superannuation Fund with the cost to be met from resources of that Fund or if necessary, shared equally between the four trustees.
THE C PARTNERSHIP
6. In respect of the C Partnership:
6. (a) the parties are to each respectively do all acts and things and sign all documents required to divide equally between them all funds held by the partnership once the $178,130.75 referred to in paragraph (2)(c) above have been received; and
6. (b) thereafter, the parties are to do any acts and things and sign any documents to formally wind up the C Partnership, with the costs of same to be shared between the parties equally.
REMAINING ENTITIES
7. In respect of any other entities relating to the Tilston family business in which any of the parties have interests:
7. (a) The husband is to prepare, at his expense, any documentation, resolutions or other documents necessary to record the resignation of each of the wife and the third respondent from any office that they respectively hold in any such entity; and
7. (b) The husband is to deliver all such documentation to the wife and the third respondent; and
7. (c) The wife and the third respondent are, at their expense respectively, to sign and return all such documents within 14 days of receipt.
JEWELLERY
8. The wife make arrangements for the 1.14 carat solitaire diamond ring which belonged to the husband’s mother to be delivered to the second respondent within 14 days from the date of this order;
9. The wife make arrangements for the following items to be delivered to the husband within 14 days from the date of this order:
9. (a) Unit #...15; ID #187 Pear Shaped Opal Necklace;
9. (b) Unit #...16; ID #188 Emerald cut kunzite broach;
9. (c) Unit #...4; ID #197 1x loose .45 carat diamond; and
9. (d) Unit #...1; ID #204 Qty 3 loose gemstones.
E HOLIDAY MEMBERSHIP
10. Within 7 days from the date of this order, the husband and wife are to do all acts and things and sign all documents necessary to list the E Holiday Membership for sale on ….com.au for a list price of $26,000, and the following shall apply:
10. (a) if the E Holiday Membership has not been sold after one fortnight, the list price is to be reduced by $5,000 and by $5,000 each fortnight thereafter until it reduces to a list price of $11,000;
10. (b) if, at the time the list price reaches $11,000, the E Holiday Membership has not been sold, the list price is to thereafter reduce by $1,500 every 7 days until the list price reaches $3,500;
10. (c) if, at the time the list price reaches $3,500, the E Holiday Membership has not been sold, the E Holiday Membership is to remain listed on ….com.au until such time as:
10. (i) it is sold to a third party, or
10. (ii) either party gives notice in writing to the other party that they wish to acquire the interest at the currently listed price;
10. (d) each of the husband and the wife are at liberty to acquire the E Holiday Membership at the then listed price, by giving notice in writing to the other party at any stage of the selling process provided for in this order;
10. (e) if a third party makes an offer to purchase the E Holiday Membership at the then listed price, the husband or the wife are each at liberty to purchase the membership at the same price offered by the third party, by giving notice in writing to the other party that they wish to do so;
10. (f) if the E Holiday Membership is purchased by a third party, the husband and the wife are to each do all acts and things and sign all documents necessary to cause the transfer of the membership to the third party, and the proceeds of sale are to be divided equally between the husband and the wife;
10. (g) if either the husband or the wife give notice to the other party that they wish to retain the E Holiday Membership in accordance with this order then:
10. (i) the party acquiring the interest shall pay 50% of the sale price to the other party, by depositing the funds into the non-retaining parties’ bank account as nominated by them in writing; and
10. (ii) in consideration for that payment, the non-acquiring party is to execute any and all documents necessary to cause the transfer of their right, title and interest in the membership to the acquiring party.
MISCELLANEOUS
11. The wife shall otherwise retain as and by way of property settlement, and free from any further claim by the other parties:
11. (a) her personal bank accounts, inclusive of any partial property settlement distributions made to the wife throughout the course of the proceedings;
11. (b) the furniture and contents in her possession;
11. (c) her personal possessions and belongings, including the remaining jewellery not dealt with specifically in this order;
11. (d) the share portfolio or proceeds of sale thereof; and
11. (e) any and all liabilities in her sole name.
12. The husband shall otherwise retain as and by way of property settlement, and free from any further claim by the other parties:
12. (a) his personal bank accounts, inclusive of any partial property settlement distributions made to the husband throughout the course of the proceedings;
12. (b) the campervan, plant and equipment and other items purchased by the husband from the Trustee for Sale throughout the course of these proceedings;
12. (c) the furniture and contents in his possession;
12. (d) his personal possessions and belongings;
12. (e) his interest in the Defence Force Retirement and Death Benefit (DFRDB);
12. (f) his interest in D Pty Ltd as trustee of the Tilston Discretionary Trust;
12. (g) his interest in F Pty Ltd;
12. (h) his member entitlements in the Mr Tilston Retirement Fund; and
12. (i) any and all liabilities in his sole name.
13. The husband and the wife shall forthwith do all acts and things and sign all documents necessary to close their joint CBA Account …23 and divide the balance equally between them.
14. A Registrar of the Family Court of Australia be authorised to execute documents at the request of a party in accordance with s 106A of the Family Law Act 1975 (Cth), should any party fail to sign such document within 7 days of being requested to do so.
15. Each party has liberty to apply to the Court as to the implementation or enforcement of this order, upon giving 7 days’ notice to the other parties to the proceedings.
16. In the event that the parties are unable to agree in writing within 21 days of this order what order, if any, might be made regarding costs of and incidental to these proceedings:
16. (a) Each party file within a further 14 days written submissions in respect of that issue; and
16. (b) Unless any party otherwise therein contends to the contrary, that issue be determined in chambers without the necessity of further appearance by any party.
17. In the event that the parties reach agreement in writing on the issue of costs, they are at liberty to file, jointly, a minute of consent via e-mail to the Associate to Justice Carew.
SCHEDULE
Ownership
Description
Value
Wife
Commonwealth Bank of Australia Shares
$250,051.00
Wife
Interest in the TFSF (42.71%)
$437,743.93
Wife
Interest in proceeds of sale of plant & equipment formerly owned by the family partnership (25%)
$44,532.68
Wife
Partial Property Settlement distribution received in accordance with Orders made in April 2019
$18,721.85
Wife
Partial Property Settlement distribution received in accordance with Orders dated 4 September 2019
$81,478.15
Wife
Partial Property Settlement distribution received in accordance with Orders dated 8 May 2020
$553,730.15
Wife
50% of remaining funds held in the Shearer Doyle Law Practice Trust Account (as referred to in paragraph 2(d) of the Order)
$596,994.00
Husband
50% of remaining funds held in the Shearer Doyle Law Practice Trust Account (as referred to in paragraph 2(d) of the Order)
$596,994.00
Husband
Interest in the TFSF
Accumulation $68,214.77 (6.51%)
Pension $236,150.65 (23.56%)
$304,365.42
Husband
Interest in proceeds of sale of plant & equipment formerly owned by the family partnership (25%)
$44,532.68
Husband
Partial Property Settlement distribution received in accordance with Orders made in April 2019
$18,721.85
Husband
Partial Property Settlement distribution received in accordance with Orders dated 4 September 2019
$81,478.15
Husband
Partial Property Settlement distribution received in accordance with Orders dated 8 May 2020
$553,730.15
Husband
Motor Vehicle 1
$2,000.00
Husband
Motor Vehicle 2
$2,500.00
Husband
Interest in F Pty Ltd (established post-separation)
Comprising the following:
(a) H Bank Account No. …70; and
(b) Fuel enterprise formerly operated by J Pty Ltd, acquired with the purchase of Lot B from the Trustee for Sale
$10,427.46
Wife and Husband
E Holiday Membership
Proceeds of sale
Wife and Husband
(to be divided so as to achieve an overall distribution 57.5% to wife and 42.5% to husband)
Interest in the TFT
Comprising of the following:
(a) Share of sale proceeds (200 acre property/half share of 2 K Street and half share of 4 K Street) held in the Shearer Doyle Pty Ltd Law Practice Trust Account after payment of sale costs and costs of trusteeship $1,192,733;
(b) CBA Bank Account No. …02 with balance of $1,255; and
(c) Plant and equipment.
$1,193,988
Total
To be calculated upon sale of the E Holiday membership and upon taking into account any necessary adjustments
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 Tilston & Tilston 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).
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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