Tolarno and Tolarno

[2020] FamCA 152

FAMILY COURT OF AUSTRALIA

TOLARNO & TOLARNO [2020] FamCA 152

FAMILY LAW – PROPERTY – where both parties have a history of non-compliance with court orders – where the application was brought by the wife as a result of the husband’s non-compliance in this instance – where the parties came to an agreement and orders were made by consent – where the matter is progressing to be set down for final hearing
APPLICANT:	Ms Tolarno

RESPONDENT: Mr Tolarno

FILE NUMBER: MLC 4394 of 2018

DATE DELIVERED: 6 February 2020

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Macmillan

HEARING DATE: 6 February 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Robinson

SOLICITOR FOR THE APPLICANT: Nicholes Family Lawyers

COUNSEL FOR THE RESPONDENT: Ms Smallwood SC

SOLICITOR FOR THE RESPONDENT: Barbayannis Lawyers

Orders

IT IS ORDERED BY CONSENT THAT

1. That all times be abridged to enable this Application to be listed urgently.

2. By 4pm on Friday, 7 February 2020, the husband deliver to the office of B Accountants at Town D, cheques drawn and signed by him on NAB account number …78 in the name of Tolarno Pty Ltd ATF F Unit Trust as follows:

(a)$21,465 payable to B Accountants;

(b)$4,307.67 payable to G Business; and

(c)$16,500 payable to H Company,

and the wife shall attend upon the office of B Accountants and countersign the aforesaid cheques by no later than 4:00 p.m. on Monday, 10 February 2020 and immediately deliver both cheques to the respective recipients.

1. The husband sign all such documents and provide all such instructions to J Company as are necessary within 48 hours of presentation to him by the wife to renew the planning permit … in respect of the real property situate at and known as T Street, V Town in the state of Victoria and upon completion of the application, the husband draw and sign a cheque to pay the cost of the permit from NAB account number … which the wife shall then countersign immediately and lodge the permit application.

2. The Wife be excused from complying with the Order 3 (a) of the Orders dated 22 January 2020 pending the completion of valuations.

Valuations

1. By 4.00pm on 7 February 2020, the Husband’s compliance with his obligations pursuant to Order 2 hereof, the Husband is to do all acts and things necessary to instruct H Company including providing any documentation requested by H Company and facilitate access to the properties the subject of the valuation reports in accordance with any reasonable request of the H Company.

2. In default of the Husband complying with his obligations in Orders 2 and 5 hereof, within 14 days of the making of the order the Wife be:

(a)authorised to do all acts and sign all documents necessary to execute the Terms of Engagement on behalf of the parties in the absence of the Husband’s signature; and

(b)permitted to attend the following properties:

(i)     1 N Street, P Town, in the State of Victoria;

(ii)    Q Street, P Town, in the State of Victoria;

(iii)   K Town & U Street and S Property;

(iv)   R Street, P Town being the whole of the land contained in Certificate of Title Volume … Folio … in the State of Victoria;

(v)    T Street, V Town in the State of Victoria;

(vi)   2 N Street, P Town, in the State of Victoria;

(vii)    W Street, X Town in the State of Victoria;

(viii) Y Street, X Town being the whole of the land contained in Certificate of Title Volume … Folio … in X Town, in the State of Victoria; and

(ix)   The Z Street property being the whole of the land contained in Certificate of Title Volume … Folio …, the whole of the land contained in Certificate of Title Volume … Folio … in the State of Victoria (known as “the Z Street property”).

for the purposes of allowing a representative from H Company to inspect the property for the purposes of the valuation reports, with the Husband not to be present at such time with the Wife to provide 48 hours’ notice of the time and date.

IT IS FURTHER ORDERED THAT

Cheques

1. Order 5 of Orders dated 6 September 2019 as amended by orders of 9 September 2019 be varied to provide:

   that the Wife is to approve and countersign business cheques for Tolarno Pty Ltd as trustee for F Unit Trust as signed by the Husband and presented to the Wife for legitimate business expenses evidenced by invoice and description of work for work as agreed by the Wife for $10,000 or less, excluding work undertaken by Tolarno Pty Ltd .

2. Paragraphs 7 to 12 inclusive of the wife’s Application in a Case filed 3 February 2020 be adjourned for hearing before Justice Macmillan at 11.30am on 28 February 2020.

3. The wife’s Application in a Case filed 3 February 2020 be otherwise dismissed.

4. Both parties costs of this day be reserved for determination at trial.

NOTATION

A.The question of the treatment of $16,500 payable to H Company be reserved for determination at trial.

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 Tolarno & Tolarno 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 MELBOURNE

FILE NUMBER: MLC 4394 of 2018

Ms Tolarno

Applicant

And

Mr Tolarno

Respondent

REASONS FOR JUDGMENT

1. This matter has been before me on a number of occasions.  I think I have been critical at various times throughout the proceedings of both the husband and the wife for various reasons.  I don’t know today, but I will eventually know when the matter comes on for a trial management hearing, how much money these parties have spent on legal costs.  I’m sure the parties are aware now that every hearing incurs costs, and that’s not a criticism of either the counsel or their solicitors.   The matter is finally getting to the pointy end and will be listed for trial, and we are again arguing over things that would appear to have been resolved. 

2. Courts generally expect that when orders are made, parties comply with them.  There have already been matters dealt with by Justice Wilson for non-compliance.  It’s not good enough, and I think it’s important that both parties understand, that when they don’t comply it reflects very poorly on them, and it makes it difficult for Courts to have any confidence that they will actually comply with the orders that the Court makes.  So it’s time for this to be brought to a conclusion, but more importantly, in this instance it lies more at the feet of the husband, to comply so that the matter can be concluded. 

3. There are a number of issues today.  The first issue, which goes to the very issue of compliance, is the question of whether H Company should be the valuer for the purposes of valuing the real properties.  On 21 August 2019, I made an order by consent that the parties jointly engage H Company as a single expert to provide a sworn valuation of the current market value of any and all real properties in which the parties hold an interest either directly or indirectly through a corporate entity or trust.  That has not happened.  What I have before me today is an Affidavit sworn by the wife and no material filed by the husband, and there may be reasons for that. I must work on the evidence I do have.  

4. On 1 November 2019, the husband wrote to Mr L, the director of H Company, advising him that he did not give his consent to H Company, acting on behalf of Tolarno Proprietary Limited, as he said:

   “[H Company] primarily have a conflict of interest.”   

   The husband said in that letter that he had commenced proceedings in the Magistrates Court against Mr M, and he saw that as a conflict.

5. H Company’s response in summary is that Mr M had previously been an employee but he no longer worked for H Company. Although the husband asserted that Mr M was a director of H Company, in response H Company have specifically indicated that he was not currently employed by H Company and was not a director.  So it would appear that Mr M may have been a contractor, however, in my view, this does not establish a conflict. 

6. H Company are expert witnesses.  Counsel for the wife submitted that arrangements can be made if H Company have a contractor, that Mr M have nothing to do with the valuations in this case and I see no reason why H Company, who the husband consented to valuing the properties should not do so. If the valuations don’t go ahead, it may hold the matter up further and in those circumstances, it is now agreed that the wife who has already paid her share of the costs, the husband’s share will come out of the Tolarno Proprietary Limited account, and any adjustment that needs to be made can be made when the matter comes on for trial. 

7. The other issues that remain outstanding are in relation to the order that was made on 6 September 2019, as amended by orders of 9 September 2019, with respect to the drawing of cheques and the obligation upon the wife to sign those cheques.  It would appear that order has not worked, perhaps as was intended or simply it has just been a cause for further dispute. 

8. The wife complains that there are regular payments or attempts are made to regularly pay their son in the sum of $6673.70 per month, although it would appear she may not have signed the cheques. Their son is working on a property they own or an entity they would appear to control owns, the equipment the wife says they own. I have some difficulty understanding why monies would be paid to the son, but it seems to me if there is a valid reason for it, it needs to be transparent and the wife should have an opportunity to consider it. It would appear that the previous orders would not to be working.  I propose to make the orders she now seeks. 

9. The wife is pursuing an application for the sale of two properties owned by Tolarno Proprietary Limited, primarily to pay an outstanding tax debt.  I’m mindful that I do certainly have an obligation to make sure creditors, and particularly so, the Australian Taxation Office are paid.  However, there is some dispute in relation to that tax debt and where it lies, and in relation to the ownership of the properties, and I’m not really in a position to resolve that today.  However, even if I were in that position, the husband actually hasn’t said it, but I’m assuming he is hoping to retain those properties.  I don’t know, but given that it will be going to a final hearing fairly soon, I am not of the view that I should sell those properties now. 

10. However, it would appear that interest and penalties are accruing, and if it turns out in the trial when all the evidence is before me that these properties should have been sold and it does seem to me that something is going to have to be sold to pay that tax debt, then certainly there may well be an argument that the husband, who is the one resisting the sale now and therefore preventing those amounts being paid, may bear that additional interest and penalties, if any.  Primarily what determines the matter from my point of view is that if the properties go on the market for sale, they may or may not sell immediately, and the hearing could potentially occur before they’re sold.  Certainly before they’re settled.

11. But I will leave open that application.  I’m not sure I will have much time.  I’m going to adjourn that part of the wife’s application to trial management hearing on 28 February 2020.  I am hopeful, as counsel for the husband submits, that if the accountants are paid there may be some clearer position, and the parties may be able to be in a better position to determine exactly what it is they are going to be seeking.  Arguably, some of the valuations could be completed by then and that would be of great assistance if that could happen.  It would give the parties an opportunity to really formulate their cases but also perhaps have some negotiations.  This has been a fairly protracted war and very unfortunate.  Whilst this asset pool is relatively large, I think there are few people who can afford to spend the sort of money that has been spent here.  So I don’t propose to sell the properties today, but I will adjourn those parts of the application, but otherwise dismiss the wife’s interim application filed 3 February 2020.  

I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered on 6 February 2020.

Associate:   

Date:  13 March 2020