Torr & Amberson
[2015] FamCA 290
•23 April 2015
FAMILY COURT OF AUSTRALIA
| TORR & AMBERSON | [2015] FamCA 290 |
| FAMILY LAW – PROPERTY – Interim Orders – significant liabilities attached to farming property - where husband seeks injunction requiring wife to sign necessary documents for refinancing of loan on more favourable terms – where wife disputes viability of farming enterprise but does not seek sale of farm – orders made requiring wife to sign all such documents necessary for the refinancing to occur. |
| Family Law Act 1975 (Cth) s 114 |
| ENRC Marketing AG v OJSC “Magnitogorsk Metallurgical Kombinat” (2011) 285 ALR 444 Epitoma Pty Ltd v Australasian Meat Industries Employees Union & Ors (1984) 54 ALR 730 European Bank Ltd v Evans (2010) 240 CLR 432 First Netcom Pty Ltd v Telstra Corporation Ltd (2000) 179 ALR 725 Luadaka & Luadaka (1998) FLC 92-830 Martiniello & Martiniello (1981) FLC 91-050 Mullen & De Bry (2006) FLC 93-293 Waugh & Waugh (2000) FLC 93-052 |
| APPLICANT: | Ms Torr |
| RESPONDENT: | Mr Amberson |
| FILE NUMBER: | ADC | 2307 | of | 2014 |
| DATE DELIVERED: | 23 April 2015 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | Adelaide |
| JUDGMENT OF: | Berman J |
| HEARING DATE: | 16 April 2015 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Jordan |
| SOLICITOR FOR THE APPLICANT: | Norman Waterhouse Lawyers |
| COUNSEL FOR THE RESPONDENT: | Mr Mellows |
| SOLICITOR FOR THE RESPONDENT: | Clelands Lawyers |
Orders
That provided the extent of finance sought from the Commonwealth Bank of Australia is not greater than the ANZ facility it replaces, the wife do forthwith sign the following documents necessary to enable the husband to discharge all loan facilities with the ANZ Bank and to obtain refinancing with the Commonwealth Bank of Australia:-
(a)The ANZ Discharge and Variation Authority in relation to the following loans in the joint names of Mr Amberson and Ms Torr:-
(i)ANZ Fully Drawn Advance …;
(ii)ANZ Fully Drawn Advance …; and
(iii)ANZ Fully Drawn Advance …;
(b)The ANZ Discharge and Variation Authority in relation to the following loans in the names of J & Mr Amberson:-
(i)ANZ Cheque Account 4959-10363; and
(ii)ANZ Fully Drawn Advance 3809-76637.
The wife shall do all such things and sign all such further documents as shall be required from time to time to facilitate the husband refinancing the ANZ Bank loan accounts with the Commonwealth Bank of Australia.
That pursuant to orders (1) and (2) herein, the wife shall not be required to sign any document or do any act or thing which would have the effect of making her personally liable to the Commonwealth Bank of Australia either by way of a borrower or guarantor.
That subject to the successful refinancing of the ANZ Bank loan with the Commonwealth Bank of Australia, the husband will cause the wife to receive a release in writing from the ANZ Bank in respect of any or all liability that she currently has whether by way of borrower and/or guarantor.
That the husband indemnify the wife in relation to any loss, damage or diminution to the property interests of the parties arising directly from the husband’s refinance of the existing ANZ farming loan facilities with the Commonwealth Bank of Australia.
That until further order the husband do provide to the wife a Profit and Loss Statement for the farming enterprise within fourteen (14) days of the conclusion of each financial quarter.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Torr & Amberson 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 2307 of 2014
| Ms Torr |
Applicant
And
| Mr Amberson |
Respondent
REASONS FOR JUDGMENT
INTRODUCTION
By Initiating Application filed 30 June 2014, Ms Torr (“the wife”) commenced proceedings for property settlement.
As part of the application, the wife sought interim orders to restrain Mr Amberson (“the husband”) from operating the farming loan facility other than for the purpose of a farming operation, or from extending or increasing the debt guaranteed by the parties and secured over the farm property.
For his part, the husband filed a Response on 9 September 2014 and sought interim orders that would mandatorily require the wife to sign such documents as may be necessary to enable him to continue to trade through the existing ANZ finance arrangements namely, ANZ Bank Revolving Agriloan and an ANZ Business Loan. At that stage the total current limit was $826,000 being $426,000 for the Agriloan and $400,000 for the Business Loan.
The interim orders sought by each of the parties were not pressed on the next hearing date. However, by Amended Response filed 13 November 2014 the husband sought amended orders that would require the wife to sign documents enabling the husband to trade and if necessary extend the following ANZ Bank loan accounts:-
(1)ANZ fully drawn advance …
(2)ANZ fully drawn advance …
(3)ANZ fully drawn advance …
(4)ANZ fully drawn advance …
(5)ANZ cheque account …
In response the wife filed an Amended Initiating Application on 14 November 2014 and whilst not seeking to change the substantive interim order as sought, did amend the interim proceedings by the inclusion of an order seeking that the husband provide discovery in respect of the conduct of the ANZ and other loan facilities, trading figures for the farming enterprise and the provision of bank statements.
The interim proceedings were not pressed on either 1 October, 19 November or 15 December 2014. On 28 January 2015 I dismissed the interim proceedings but gave liberty to either party to relist on seven days’ notice.
By Second Amended Response filed 26 March 2015, the husband sought the following orders:-
(1)That the wife do forthwith sign the following documents to enable the husband to discharge all loan facilities with the ANZ Bank and to obtain refinancing with the Commonwealth Bank of Australia:-
1.1the ANZ discharge and variation authority in relation to the following loans in the joint names of [Mr Amberson] and [Ms Torr]:-
1.1.1ANZ fully drawn advance …;
1.1.2ANZ fully drawn advance …; and
1.1.3ANZ fully drawn advance ….
1.2the ANZ discharge and variation authority in relation to the following loans in the name of J and [Mr Amberson]:-
1.2.1ANZ cheque account 495910363;
1.2.2ANZ fully drawn advance 380976637.
(2)That following thereon from paragraph (1) herein the wife do all such things and sign all such further documents as may be required from time to time to facilitate the husband refinancing the ANZ Bank loan accounts with the Commonwealth Bank of Australia.
It is necessary to set out the extent of the orders sought by the husband in order to put the present application in context. Up until the filing of the Second Amended Response, the gravamen of the orders was to require the wife to co-operate with the existing finance arrangements with the ANZ Bank. The difference is critical and made more so by the submissions of counsel for the husband.
The husband now seeks that the wife co-operate in a refinancing of the entirety of the liability with the Commonwealth Bank of Australia (“CBA”). The advantage to the wife (subject to any suggestion that the husband might increase the overall liability) is that the proposed finance arrangements with the CBA would have the husband as being the sole borrower, there would be no liability attaching to the wife and to the extent that she has given guarantees to the ANZ Bank, that would not be required if the new financing arrangements were to be put in place.
By Second Amended Initiating Application filed 13 April 2015 the wife sought the following relevant orders:-
(3)That paragraphs 1 and 2 of the interim orders sought in the husband’s Second Amended Response to Initiating Application filed on 26 March 2015 be dismissed.
(4)In the event this Honourable Court grants orders in terms of paragraphs 1 and 2 of the interim orders sought in the husband’s Second Amended Response to Initiating Application filed on 26 March 2015 that the husband indemnify the wife in relation to any negative impact on the parties asset pool from the ongoing operation of the farming enterprise following the husband’s refinance of existing ANZ farming loan facilities with the Commonwealth Bank of Australia.
Importantly the wife sought additional orders which if granted would require the husband to do all things necessary to cause six properties in the Northern Territory and one in South Australia to be placed on the market for sale and that the net proceeds would be used to discharge liability of the parties and provide for a payment to each of them of $150,000.
The interim orders sought by the husband were re-excited pursuant to my order of 8 January 2015 and the matter came before me on 16 April 2015 with each of the parties being present and represented by counsel.
A number of issues arose in respect of the orders sought generally. I heard submissions in respect of paragraphs 1, 2 and 7 of the Second Amended Response and also paragraphs 3 and 4 of the Second Amended Initiating Application of the wife.
The balance of the orders including the wife’s application for the sale of property and the distribution of proceeds of sale are adjourned to 14 May 2015 with further directions made.
At the commencement of the hearing counsel for the husband advised the Court (and potentially the wife for the first time) that there may no longer be any efficacy in the orders as set out in the husband’s response because the ANZ Bank may well be prepared to discharge their liabilities against the offer of CBA refinancing without requiring the wife’s involvement or consent. The proposed CBA finance would not involve the wife.
Mindful of the history of the matter and notwithstanding the optimism of the husband, I considered that the application needed to be heard and determined.
In any event the wife did not resile from her application to dismiss the orders sought by the husband, but if unsuccessful she seeks the following order:-
(4)In the event this Honourable Court grants orders in terms of paragraphs 1 and 2 of the interim orders sought in the husband’s Second Amended Response to Initiating Application filed on 26 March 2015 that the husband indemnify the wife in relation to any negative impact on the parties’ asset pool from the ongoing operation of the farming enterprise following the husband’s refinance of existing ANZ farming loan facilities with the Commonwealth Bank of Australia.
BACKGROUND
The husband was born in 1963 and is a farmer/grazier. He resides on a farming property near Town A in South Australia. The wife was born in 1964 and is a chief executive officer in the technology industry. She resides in a property in Suburb B, Sydney. There is some dispute as to the date of commencement of cohabitation and their final separation. For her part, the wife asserts that the parties commenced the relationship in 1985 and separated finally in July 2012. For his part, the husband considers that the relationship commenced in 1989 with a separation in May 2013. The parties were never married. On either version it is a long relationship.
There are two adult children of the relationship namely Mr C born in 1991 and Ms D born in 1997.
Whilst not directly relevant to the determination of the narrow compass of issues in this application, it is clearly important to the husband that the history of acquisition of property but in particular the farming entity, is understood.
The husband alleges a long family connection with the farming enterprise comprising “E”, “F”, “G” and “H”.
The husband says that he purchased “G” in 1983 and in 1987 inherited “E” subject to a life interest in favour of his mother and the payment of a percentage of the value of the farming property to his siblings upon her death. The husband also inherited one half share in “F”.
Following the death of his father he also received interest in various capital assets in the partnership business of I & J Amberson.
Finally in 1991 the husband and his mother purchased property at H. His mother’s interest was gifted to the husband in 2000.
The parties are unlikely to agree the extent to which each of them have made contribution to the property that now forms the pool of assets available for division. The husband has clearly flagged his position in respect of the farming properties where he says at paragraph 13 in his affidavit filed 9 September 2014:-
In 1989, the applicant moved back to the family farm briefly. She made some limited financial contributions towards household improvements and groceries and the cost of an overseas trip. She made no contribution to the farming enterprise or the maintenance, acquisition or improvement of any farming land, nor did she make any contribution towards the farm debt and was not involved in the farming operation, as she was saving for a trip to Europe, the applicant lived in Australia during 1990 as she was saving for a trip to Europe. The applicant lived in Austria during 1990.
That contention is not favoured by the wife.
The parties acquired significant property during the course of their relationship. Of particular importance to the wife is the retention of her property at K Street, Suburb B. The husband, in addition to the farming properties, is keen to retain a property at L Street, Suburb M. In 2005 the parties purchased five investment properties in Darwin. It is those properties together with the Suburb M property that are targeted by the wife in her application for their sale and the distribution of at least some of the net proceeds towards debt reduction and partial property settlement.
The parties are not agreed as to the construct of the interests that they have in assets and liabilities. Each of the parties seek orders that will likely require a consideration of the appointment of either single expert valuers or potentially giving leave to the parties to appoint their own separate adversarial expert witness.
In order to have some measure of the assets and liabilities of the parties, I ordered that each of them file and serve a balance sheet in anticipation of the hearing. Both parties complied and balance sheets were filed conveniently on 16 April 2015.
It could not be said that the parties are in agreement as to the value to be attributed to the assets that comprise the pool. It is however a reasonable summary that in terms of magnitude of scale, the view of each of them as to their net asset position are not dissimilar.
For her part, the wife considers that the total assets are $13,752,718, with total liabilities of $8,338,315, leaving a net asset position of $5,414,403. The husband considers that the total assets are in the sum of $14,729,309 with liabilities of $8,282,567 leaving a net balance of $6,446,742. Both parties therefore consider that even taking into account the significant variance between them, there is likely to be a substantial net surplus of asset over liability.
Importantly, the wife considers that the value of the four parcels of farming land total $7,400,000, whereas the husband values the properties at $6,811,000. In addition, there is significant additional value by reference to livestock, plant and equipment and the J Amberson partnership account.
For the purposes of this application, both parties concede that the current liability to the ANZ Bank (and therefore the amount that the husband seeks to refinance by the CBA) is approximately $2,900,000.
ISSUES RAISED BY THE PARTIES
The position of the husband is succinctly set out in a submissions document filed by his counsel on 16 April 2015. The husband considers that he has a long connection with the farming properties and would wish to retain them as part of final orders sought.
He seeks therefore an order by way of “a mandatory injunction directing the applicant wife to sign all documents and loan facilities with the ANZ Bank to secure refinancing of the respondent husband’s farming properties with the Commonwealth Bank of Australia”.
He alleges that the ANZ Bank have been pressing the parties from as early as November 2014 to repay the loans. I am referred to “JM1” of the affidavit of the wife filed 19 November 2014 annexing a demand notice from the ANZ Bank advising that the amount owing as at 12 November 2014 was $814,188.
It would seem apparent that the husband was under significant pressure from the ANZ Bank to either substantially reduce the level of debt, or preferably to seek finance elsewhere.
It appears from communication passing between the solicitors for the parties (to which no objection was taken) that the wife was prepared to consent to the refinancing arrangements as proposed by the husband conditional upon the properties at Darwin and Suburb M being sold. The husband was not prepared to agree to that condition and accordingly agreement was not able to be reached.
The position of the wife is her concern that the farming venture is no longer viable. She considers that as matters presently stand a default is likely and would see a substantial diminution of the asset pool. She is not confident that the husband is able to operate a sustainable farming enterprise. She does not consider, given the significant obligation that the husband may have under his father’s Will to discharge an entitlement to his siblings, that he can possibly retain the farming land upon the death of his mother. Moreover, there is a long history of losses and it is her position that over the years the debt has steadily but in execrably grown.
To highlight the point, she refers to the concerns of the ANZ Bank as expressed in correspondence to her of 21 May 2014 that there are ongoing trading losses, liquidity problems and the difficulty that is presented by the “marital estrangement of borrowers”.
In summary her position is set out in paragraph 23 of her affidavit filed 13 April 2014:-
I am concerned about the overall viability of the farming operation and the ability of the husband to service new Commonwealth Bank loan facilities in circumstances where he could not service the ANZ facilities without increasing debt and accessing non-farming assets as referred to in paragraph 41 hereof.
To reinforce her position, the wife sought assistance from Mr N, a forensic accountant, to undertake a comparison of the 2014 budget, 2015 budget (forecast actual) and 2014 actuals.
The initial analysis by Mr N is necessarily superficial but is reduced to a straightforward summary namely, that the forecast for the 2014 budget was a net surplus of $102, 824, the actual outcome is a net deficit of $45,249 and whilst the budget for the 2015 financial year is forecast to be $50,515, the question that is posed is the extent to which confidence can be placed in the 2015 budget given the significant negative variance evident from the 2014 financial year outcome.
The argument based upon the views expressed by Mr N are well encapsulated in the letter from the wife’s solicitors to the solicitors for the husband of 20 February 2015 forming Annexure “ST 8” to her affidavit filed 13 April 2015.
The husband instructed Mr O, also a forensic accountant, to prepare a brief report as to the viability and sustainability of the husband’s farming enterprises. That document dated 19 March 2015 forms part of Annexure “DJA9” to the affidavit of the husband filed 26 March 2015. A summary of Mr O’s report is as follows:-
For the reasons described below, I consider that [Mr Amberson’s] farming enterprise is viable and sustainable, and that its viability and sustainability could only be improved by the proposed refinancing.
I estimate the refinancing of 3.9 million from average interest rates of 8% to less than 5% will have the financial effect of reducing the interest paid and, hence, increasing net profits and cash flow of [Mr Amberson’s] farming enterprise by an annual amount of $93,750. Consequently, on the basis that the farming enterprise is viable, as it is presently financed, both its viability and sustainability can only be improved with the refinancing.
Thereafter the findings of Mr N are the subject of critical consideration by Mr O.
As is not uncommon in disputes of this nature, the wife further instructed Mr N to critique the report of Mr O. In his summary he highlights the substantial debit of $2.925 million and considers that there are errors and omissions in the projections as prepared by Mr O for the following reasons:-
A.I believe they fail to allow for interest payable to PPH and S for short term annual livestock requirements in the order of $25,000 per annum.
B.They don’t allow for interest on the additional overdraft facility.
C.I believe the calculations have included livestock and commodity sales and the profit and loss analysis that GST inclusive prices and the net surplus based on the data adopted by [Mr O] may be overstated by $57,290 per annum.
D.Income projections (based on livestock sales per head) adopted by [Mr O] are historically high for this business and whilst that may be achievable in the short term, one would query whether such prices are sustainable.
It is not possible for me to determine whether either expert is more likely that the other to accurately foretell the future. The matter is also complicated by a consideration of whether the question of viability is in the short or long term. Presumably it is not a matter of concern to the wife whether the farming venture is viable in the long term. Her consideration (in circumstances where she does not seek to retain any part or portion of the farming property), is to ensure the integrity of the asset pool as at the date of final hearing. To some extent the parties are in agreement on this aspect. It is the husband’s position that the farming properties should be retained by him and that if they were to be sold there may well be a diminution of the pool of assets available for distribution. Moreover if the husband’s expectations are fulfilled and the farm remains viable and profitable, this is more likely to enhance rather than detract from the overall value of the parties interest in property.
Whilst it is potentially an unfair view of the detailed considerations given by Mr N, I think it is reasonable to find that in the short term (until trial in late 2015 or early 2016) interest rates will remain low and the husband’s position is probably sustainable during that period.
The one area of consensus however is that a successful refinancing will bring the immediate advantage of significant interest payment reduction, estimated by the husband to be a saving of about $93,000 per annum.
It is also a proper consideration that doing the best each of the parties can, they both consider that at present there is significant surplus asset after the liabilities have been brought to account.
The husband has offered an indemnity to the wife in respect of any loss that might be sustained as a direct result of the refinancing. The response of the wife is that she seeks that the husband shall indemnify her “in relation to any negative impact on the parties asset pool from the ongoing operation of the farming enterprise following the husband’s refinance of existing ANZ farming loan facilities with the Commonwealth Bank of Australia.
There is a significant difference in the position promoted by each of the parties. The indemnity offered by the husband is clearly of limited compass in that it is confined to any loss that might be sustained or liability incurred from the actual refinancing arrangements, and in terms of any circumstance where the liability to the Commonwealth Bank exceeds the current indebtedness to the detriment of the parties net asset position.
Because the wife is generally pessimistic as to the financial viability and sustainability of the farming enterprise, she seeks an indemnity in relation to any ongoing impact from the farming operation.
There is however an inconsistency in the approach adopted by the wife namely, that the broad indemnity sought in paragraph 4 of her interim orders would more properly have focus if she sought orders that the farming enterprise be sold. That is not her application, although it is clearly her underlying view.
The husband argues that there is no risk to the wife in the refinancing proposal. If he is unsuccessful then obviously the parties are in a position no different to that which current exists namely, that there is an extant and pressing liability with the ANZ Bank. If the finance proposal is successful, the same debt as currently exists will continue and the wife gains the considerable advantage by being relieved from her involvement as a borrower and guarantor. That taken together with the limited indemnity offered by the husband would not only protect the wife but rather give her significant advantage in her release from liability.
Given that the wife has not sought an order for the sale of the farming properties there is merit in the husband’s argument. It would not be appropriate for the wife to achieve her desired outcome via the process of debt default with the ANZ Bank. It is likely that such an outcome has the real potential to adversely affect the net value of the property of the parties.
LEGAL PRINCIPLES
The relevant orders sought by the husband in the Second Amended Response is by way of a mandatory injunction directing the wife to sign all documents and do all things as may be necessary to enable the husband to secure refinancing of the ANZ loan facilities to the Commonwealth Bank of Australia.
It was not argued that the Court lacks jurisdiction to make the orders sought.
Section 114 (1) of the Family Law Act 1975 (Cth) (“the Act”) provides:-
In the proceedings of the kind referred to in paragraph (e) of the definition of matrimonial cause in subsection 4(1), the court may make such order or grant such injunction as it considers proper with respect to the matter to which the proceedings relate, including –
(a) …
(b) …
(c) …
(d) …
(e) …
(f) …
Paragraph (e) of the definition of “matrimonial cause” in s 4(1) of the Act is as follows:-
(e)proceedings between the parties to a marriage for an order or injunction in circumstances arising out of the marital relationship (other than proceedings under a law of a State or Territory prescribed for the purposes of section 114AB).
Subsection 114(3) provides:-
Section 114(3):-
A court exercising jurisdiction under this Act in proceedings other than proceedings to which subsection (1) applies may grant an injunction by interlocutory order or otherwise (including an injunction in aid of the enforcement of a decree), in any case in which it appears to the court to be just or convenient to do so and either unconditionally or upon such terms and conditions as the court considers appropriate.
Injunctive relief under s 114(1) is therefore only available in proceedings which come within paragraph (e) of the definition of “matrimonial cause” in s 4(1) of the Act that is, proceedings between the parties to a marriage for an order or injunction in circumstances arising out of the marital relationship. It would seem that there is no need to consider subsection 114(3) given the provisions of s 114(1).
In Epitoma Pty Ltd v Australasian Meat Industries Employees Union & Ors (1984) 54 ALR 730 , the Court held that in an application for an interlocutory injunction the Court must first enquire whether there is a serious question to be tried. The test is whether the balance of convenience favours the applicant, in particular in circumstances where the respondent would not be prejudiced or significantly so by the grant of relief.
The opposition of the wife is not directed to any prejudice caused to her directly by the husband’s application that if granted, would require her to execute documents and provide her consent to the refinancing with the CBA.
As indicated, I am not satisfied that the wife has established the potential for prejudice to the asset pool and therefore her entitlement upon a final determination of the property interests of the parties.
To the extent that there is an issue as to an undertaking (or indemnity) as to damages is a matter that goes to the risk to the wife and whether than can be ameliorated by the giving of an undertaking.
To some extent the issue is “de minimis” given the concession of the husband that he will offer a limited indemnity in respect of any damages or loss that may flow from the refinancing transaction as opposed to the broader indemnity sought by the wife in relation to financial loss arising from the continued operation of the farming venture.
The principal test has been clearly enunciated by the Full Court in Waugh & Waugh (2000) FLC 93-052 at 87,810 and Mullen v De Bry (2006) FLC 93-293. In summary, a Court is required to find that there is a serious issue to be tried and that the balance of convenience supports the making of the order.
The issue of undertaking as to damages was not a matter significantly pressed. To the extent that it is an order sought by the wife, the husband argues that proceedings pursuant to the Act should not generally be considered in the same way as an injunction that is sought in a more commercial setting where the undertaking as to damages has greater focus.
In European Bank Ltd v Evans (2010) 240 CLR 432 the High Court concluded that:-
…the undertaking as to damages is given to the court, for enforcement by the court; it is not a contract between the parties or some other cause of action.
An undertaking is given:-
…as a response to the anxiety entertained by the court that otherwise its interlocutory order might lead to damage for which there could be no redress except by an order for costs.
In First Netcom Pty Ltd v Telstra Corporation Ltd (2000) 179 ALR 725 the Full Court noted at [23] – [25] that the terms of the usual undertaking for damages is a:-
…matter for the discretionary judgment for the court, its provisions will be moulded so as to fit the circumstances of the case at hand. These circumstances may include the likelihood of the plaintiff’s insolvency, which might produce an inability to discharge any liability to the party enjoined pending a final hearing that might accrue under the undertaking.
Similarly in ENRC Marketing AG v OJSC “Magnitogorsk Metallurgical Kombinat” (2011) 285 ALR 444, Rares J considered the Federal Court’s power to require security for an undertaking as to damages after his Honour expressed concern that the subject shares were subject to “potential volatility in financial markets”:-
[11]The Court has an inherent or implied power to require security for an undertaking as to damages as an incident of its ability to condition the making of its own orders. The provision of security can be required as a condition of the Court acting on an undertaking as to damages given by a person who is not present in the jurisdiction, or alternatively, does not appear to have sufficiently disclosed a substantive financial basis on which to meet any liability on the undertaking in the event that it is called upon.
A helpful consideration is to be found in the list of relevant factors as set out by the Full Court in Luadaka & Luadaka (1998) FLC 92-830 at [62].
I am also cognisant of the decision in Martiniello & Martiniello (1981) FLC 91-050 at page 76,421:-
…In the absence of … a special interest or claim to an interest, the husband ought not to have been restrained from ordinary business dealings unless it could be shown that there was a fear that he would dissipate his funds or transfer them overseas for some other reason.
Accordingly, whilst I consider it reasonable for the husband to be bound by an undertaking as to damages restricted to that which might flow from the refinancing, I do not consider that a general undertaking as to damages should be imposed upon him.
In the absence of any application by the wife that the farming enterprise should be sold because it is not viable, he should be entitled to refinance the ANZ facilities in circumstances where to do so will result in the immediate benefit of a lower rate of interest and in the absence of any identified risk that would inure to the wife.
CONCLUSION
Accordingly I propose to make orders in terms of paragraphs 1 and 2 of the interim orders sought by the husband.
In addition the husband offers to provide a profit and loss statement for the farm business within 14 days of the conclusion of each financial quarter and whilst the wife may well seek a more rigorous order, in the interim such an order can only be to the advantage of the wife.
I make orders as appear at the commencement of these reasons.
I certify that the preceding eighty one (81) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Berman delivered on 23 April 2015.
Associate:
Date: 23 April 2015
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