TRITTON & POYZER - [2010] FamCA 666

FAMILY COURT OF AUSTRALIA

TRITTON & POYZER

[2010] FamCA 666

FAMILY LAW – PROPERTY SETTLEMENT – adjustment of property interests – whether assets acquired post separation should be brought into account in determining the parties’ asset pool – where the parties agree that their contributions were equal up to separation – where a significant time has elapsed since the parties’ separation – consideration of contributions made after separation – where it is alleged that the husband drew upon matrimonial assets to acquire new assets for his own benefit – where the wife alleged that the husband had undisclosed interests in assets – where the husband’s actions in numerous business dealings did not benefit the parties –contributions assessed as 60:40 in favour of the wife – no adjustment upon consideration of s 75(2) factors

FAMILY LAW – PROPERTY SETTLEMENT – add backs – where the wife seeks that expenses incorrectly debited as business expenses be brought into account – whether such expenditure by the husband were reasonable expenses – consideration of the time elapsed since separation – where it was appropriate to add back rent, legal fees and unaccounted profits of the husband – where the husband’s expenditure and involvement in other ventures could not be quantified – considered in the context of overall adjustment

FAMILY LAW – PROPERTY SETTLEMENT – where it was appropriate for contributions to certain assets be considered separately – contributions in relation to these assets assessed at 65:35 in favour of the husband.

Family Law Act 1975 (Cth) ss 79 & 75(2)

Family Law Rules 2004 r 13.01

Chorn & Hopkins (2004) FLC 93-204
Essex & Essex (2009) FLC 93-423
Gollings & Scott (2007) FLC 93-319
Hickey & Hickey & Attorney-General for the Commonwealth of Australia (2003) FLC 93-143
M and M (1998) FamCA 42
Omacini and Omacini (2005) FLC 93-218
Reichstein & Reichstein [2006] FamCA 1422
R & R [2004] FamCA 388
Wilde & Wilde [2007] FamCA 1044

APPLICANT:

Ms Tritton

RESPONDENT:

Mr Poyzer

FILE NUMBER:

ADF

1063

2001

DATE DELIVERED:

3 August 2010

PLACE DELIVERED:

Adelaide

PLACE HEARD:

Adelaide

JUDGMENT OF:

Dawe J

HEARING DATE:

5-6 Nov 2007; 12-16 Nov 2007; 26-28 Mar 2008; 21-24 Apr 2008; 28-31 Oct 2008; 3-7 Nov 2008; 4‑6 Feb 2009; 9-13 Feb 2009;
23-27 Feb 2009; 11-12 Mar 2009; 16-17 Apr 2009; 29 Apr 2009; 1 May 2009; 4-5 May 2009;
2-4 Sept 2009; 22-23 Sept 2009;

15-18 June 2010

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Ms Nelson, QC, with Mr Whittle (Until end of September 2009)

SOLICITOR FOR THE APPLICANT:

DAVID DAVIDSON (until January 2010)

COUNSEL FOR THE RESPONDENT:

Ms Pyke, QC (Nov 2007 - April 2008) Husband In Person from October 2008

SOLICITOR FOR THE RESPONDENT:

RANDLE & TALYLOR
(until October 2008)

Orders

Upon noting that the Poyzer Group includes the following:

(a)      AMC Pty Ltd (“AMC”)
(b)      Poyzer Family Trust (“PFT”)
(c)      M Centre Unit Trust (“MCUT”)
(d)      C Pty Ltd (“CPL”)
(e)      Poyzer Properties Unit Trust (“PPUT”)
(f)      Poyzer Family Trust No 2 (“PFT2”)

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading TRITTON & POYZER

Details

AGLC: TRITTON & POYZER [2010] FamCA 666
Case: [2010] FamCA 666
Decision Date: 3 August 2010

CaseChat Overview and Summary

This case involved a property settlement dispute between a husband and wife, heard by Dawe J. The primary dispute concerned the division of assets and liabilities, including the consideration of assets acquired and expenses incurred after the parties' separation. The wife sought to have certain expenses debited by the husband as business expenses added back to the asset pool, alleging they were unreasonable or improperly accounted for. She also alleged the husband had undisclosed interests in assets and had drawn upon matrimonial assets for his own benefit.

The court was required to determine how to assess contributions made by each party, particularly in light of the significant time elapsed since separation and the husband's post-separation financial activities. Key legal issues included whether assets acquired post-separation should be included in the divisible asset pool, the appropriateness of "add-backs" for disputed expenses, and how to assess contributions to specific assets separately. The court also considered the application of section 75(2) of the Family Law Act 1975 (Cth) in making any adjustments.

Dawe J reasoned that while the parties' contributions were agreed to be equal up to the point of separation, the significant time elapsed since separation necessitated consideration of post-separation contributions. The court found it appropriate to add back certain expenses incurred by the husband, such as rent, legal fees, and unaccounted profits, to the asset pool. However, the husband's other ventures and expenditures could not be precisely quantified. Ultimately, the court assessed contributions to the overall asset pool as 60:40 in favour of the wife, with a separate assessment for certain assets at 65:35 in favour of the husband. No further adjustment was made under section 75(2) factors.

The final orders provided for a comprehensive property settlement. The wife was to retain her interest in a specific property, subject to a mortgage repayment obligation. The husband was ordered to pay the wife a substantial sum of $968,000, with provisions for adjustments based on the sale of other properties. The orders also addressed the discharge of loan accounts between the wife and entities within the "Poyzer Group," the transfer of interests in various entities, and the husband's option to transfer a property to the wife, which would reduce the amount payable to her. The orders further detailed the process for the sale of a property if the husband failed to meet his payment obligations, and included extensive provisions for indemnities and the division of superannuation interests.

Orders

Orders of the court

Upon noting that the Poyzer Group includes the following:

(a) AMC Pty Ltd (“AMC”)

(b) Poyzer Family Trust (“PFT”)

(d) C Pty Ltd (“CPL”)

(e) Poyzer Properties Unit Trust (“PPUT”)

(f) Poyzer Family Trust No 2 (“PFT2”)

(g) Partnership of Poyzer Family Trust No 2 and A&B Z (“PZ Partnership”)

(h) PZ Corporation Pty Ltd (“PZCorp”)

(i) L Corporation Pty Ltd (“LCORP”)

(j) L Unit Trust (“LUT”)

(k) Poyzer Investments Pty Ltd (“PI”)

(l) Poyzer Nominees Pty Ltd (“PN”)

(m) Poyzer Investments Pty Ltd Superannuation Fund (“PISF”)

(n) A Poyzer Pty Ltd (“AP”)

(o) A Poyzer Superannuation Fund (“APSF”)

(p) Tritton Properties Pty Ltd (“TP”)

(q) Tritton Properties Unit Trust (“TPUT”)

(r) Poyzer Properties Pty Ltd (“PP”)

(s) UP Pty Ltd (“UP”)

It is ordered that in full and final settlement of adjustment of property rights and spousal maintenance between the parties:

The wife do retain for her sole use and benefit absolutely all her interest in the property at N in the State of South Australia free from any claim by the husband or any of the entities in the Poyzer Group SAVE AND EXCEPT that the wife shall hereafter pay all monies now due and payable in relation to the First Mortgage Home Loan secured over the said property to the Commonwealth Bank of Australia up to $250,000.

If upon sale of the real estate referred to in paragraph 3 of the order of this Court of 18 June 2010 (Lot 22, M and Lots 51 and 52, M in the State of South Australia) in excess of $250,000 remains owing to the Commonwealth Bank of Australia which is secured over the property at N such sum shall forthwith be paid by the husband to the Commonwealth Bank of Australia to ensure that the only amount owing secured over the property at N is the principal sum of $250,000.

The husband shall on 17 September 2010 (“settlement day”) pay to the wife the sum of NINE HUNDRED AND SIXTY EIGHT THOUSAND DOLLARS [$968,000.00].

If by settlement day any monies are standing to the credit of the joint interest earning account in the names of the parties pursuant to the settlement of sale of the properties referred to in the order of 18 June 2010 (Lot 22, M and Lots 51 and 52, M) then such sum shall be paid from the said account to the wife in reduction of the amount required pursuant to the paragraph (3) ($968,000).

Hereafter all loan accounts payable by the wife to any entity in the Poyzer Group shall be discharged without any payment for or on behalf of the wife provided that at the option of the husband such loan accounts shall be transferred to the husband.

On settlement day the husband shall cause each of the entities in the Poyzer Group to provide to the wife acknowledgement that all loans, debts or other monies due by the wife to any entity in the Poyzer Group are discharged.

If after the husband has paid the sum of $968,000 to the wife further sums are paid to the joint account pursuant to the orders of 18 June 2010 then any amounts thereafter credited to the said joint account are to be released to the husband.

The husband shall have the option to transfer at his cost all his interest and estate in the property situated at P (“P property”) freehold and unencumbered with vacant possession to the wife PROVIDED THAT such option is exercised by notifying the wife in writing of the intention to transfer the P property to the wife by 3 September 2010 and PROVIDED THAT such transfer is completed on settlement day.

If the husband transfers the freehold unencumbered interest in the P property with vacant possession to the wife on settlement day then the sum of FOUR HUNDRED AND FORTY THOUSAND DOLLARS [$440,000.00] shall be credited to the husband against the payment of the sum of NINE HUNDRED AND SIXTY EIGHT THOUSAND DOLLARS [$968,000.00] due to the wife pursuant to these orders.

10.

The P property transferred to the wife pursuant to this order shall include all fixtures, fittings and improvements to the P property.

11.

If the husband exercises the option the husband shall provide vacant possession of the P property on the settlement day to the wife and provide to the wife all keys and instruments necessary to operate all locks and devices and provide all documents currently in his possession relating to the P property and all fixtures and fittings.

12.

The husband shall pay all rates, taxes and charges in relation to the P property until settlement day and thereafter if the property is transferred to the wife free and unencumbered together with vacant possession the wife shall thereafter pay all rates, taxes and other outgoings in relation to the property.

13.

In the event the husband does not pay the sum referred to in paragraph (3) hereof on settlement day interest shall be payable upon such sum as remains unpaid at the rate of interest currently prevailing under the Family Law Rules such interest to be calculated on daily balances on the amount outstanding on settlement day to the date of payment in full.

14.

If by 1 October 2010 the husband has not paid the full sum in accordance with paragraph (3) hereof and has not transferred the P property to the wife then the husband forthwith do all acts and things and execute all documents necessary to effect a sale of the property at P (“the property”) for the best price reasonably obtainable as set out in the following manner:

(a) list the property for sale by public auction within fourteen (14) days with an agent appointed by the wife;

(b) the reserve price for the purpose of such auction shall be such price as may be determined by the agent;

(c) the husband shall co-operate in every way with the agent including (without limiting the generality of the foregoing):

(i) making the key available to the agent;

(ii) allowing inspection of the property at all reasonable times requested by the agent;

(iii) doing or saying nothing to hinder or prevent a sale being effected;

(iv) ensuring the property including the grounds are in a neat and clean condition at the time of inspection by the agent and prospective purchasers; and

(v) signing all documents requested by the agent in relation to the listing for sale of the property;

(d) in the event the bidding at the auction does not reach the reserve price the wife may negotiate with the highest bidders or any other interested person and effect a sale of the property;

(e) the husband shall execute a contract for sale in the form prepared by the agent;

(f) in the event of a sale of the property in accordance with these orders, then on settlement of the sale, the proceeds of sale be paid in the following manner and priority:

(i) all costs and expenses of sale including legal costs and disbursement, agents’ commission and auction expenses;

(ii) the amounts required to pay all municipal and water rates outstanding with respect to the property;

(iii) in payment to the wife of the amount then due pursuant to paragraph (3) hereof and any interest pursuant to paragraph (13) hereof;

(iv) payment of any costs order outstanding and payable to the wife;

(v) the balance (if any) to the husband;

(g) the husband may continue to occupy the property until completion of the sale of the property and shall be responsible for and pay all the outgoings, telephone, gas and electricity accounts, municipal and water rates, insurance and maintenance in relation to the property provided that the husband shall give vacant possession of the property not less than seven (7) days prior to the date fixed for completion of the contract for sale of the property.

15.

On settlement day or upon payment of the full amount due to the wife pursuant to these orders:

(a) the wife do resign from any office held by her in any of the entities in the Poyzer Group;

(b) the husband doing all such acts and things and signing all such documents as may be necessary to register and implement the wife’s resignation;

(d) the wife do execute all such documents as shall be necessary to give effect thereto;

16.

Hereafter the husband do indemnify the wife and procure any trustee of any of the entities of the Poyzer Group to indemnify the wife and keep her forever indemnified with respect to:

(a) all debts and liabilities of the husband past, present and future;

(b) all debts and liabilities of the Poyzer Group past, present and future;

(c) all choses in action against either of the parties or any of the Poyzer Group and in particular but not limited thereto against the wife arising out of her position as a director, secretary, shareholder or beneficiary of any of the Poyzer Group;

(d) any liability of the wife in respect of any guarantee executed by the wife in support of borrowings debts and liabilities of the husband or any of the Poyzer Group;

(e) any debt or debit loan account due by the wife to any of the Poyzer Group;

(f) all income tax, capital gains tax, GST or other taxation liabilities due by the husband and any of the Poyzer Group or due by the wife of or in relation to these orders, the allocation of monies or income to the wife from any of the Poyzer Group, of or incidental to the transfer of any interest of the wife in the Poyzer Group to the husband and the payment pursuant to these orders or the orders of 18 June 2010 SAVE AND EXCEPT that the wife shall pay the income tax, (if any) which is already assessed and outstanding due by her at 30 June 2008 ($69,730) and any other income tax or capital gains tax hereafter payable by her which does not relate to any income, distribution, payment or adjustment from the husband or the Poyzer Group.

17.

On settlement day or as soon thereafter as the husband complies with payment of the sum due under paragraph (3) in accordance with section 90MT (1)(b) of the Family Law Act 1975 (Cth):

(a) the husband shall be entitled to the specified percentage, being 100 per cent of each splittable payment made out of the wife’s interest in the self-managed superannuation fund, Poyzer Investments Pty Ltd Superannuation Fund (the old fund);

(b) the wife’s entitlement is correspondingly reduced;

(d) the operative time is the date of transfer of the transferrable benefits;

(e) Poyzer Investments Pty Ltd being the trustee of the old fund shall do all such acts and things and sign all such documents as may be necessary to:

(i) calculate in accordance with the requirements of the Family Law Act 1975 the entitlement created in paragraph (1) of these orders; and

(ii) pay the entitlement whenever a splittable payment becomes payable;

(f) the wife do:

(i) tender her resignation as a director of the trustee of the fund;

(ii) transfer to the husband her shares in the trustee fund and resign as a member of the fund;

(g) as and from the making of these orders the husband shall be responsible for and indemnify the wife in relation to the fund and any liability of the wife personally arising out of her involvement in the fund past, present or future including but not limited to:

(i) any and all liability for payment of tax to the Deputy Commissioner of Taxation past, present or future, howsoever arising, including but not limited to capital gains tax and any fine penalty or other costs in relation to any alleged non-compliance by the fund;

(ii) any and all liability of the wife for individual income tax in respect of the fund past, present or future and howsoever arising including but not limited to capital gains tax, any fine, penalty or other costs;

(iii) any and all creditors of the fund;

(iv) any and all borrowings of the fund;

(v) arising from her resignation as trustee or member.

18.

On or before 10 September 2010 the husband shall provide to the wife all documents required to be signed by the wife in order to carry out the terms of the within orders (including but not limited to resignation of directors, share transfers and notice to superannuation fund trustees).

19.

SAVE AND EXCEPT as provided herein all property whether real or personal now in the possession or control of each of the parties shall vest in that party absolutely.

20.

In the event that either party shall neglect or refuse to execute any document within seven [7] days of the same being forwarded to him/her by ordinary pre-paid post to the last known address for service then in such an event upon proof by affidavit a Registrar of this Honourable Court is hereby appointed and directed to execute the document on behalf of the party so in default and if in his/her opinion it shall be necessary so to do to settle the same and do all such other acts and things as shall be necessary to give full force and effect to these orders on the basis that the party in default shall pay the other party’s costs of and in relation to such neglect or refusal.

21.

The order of 11 November 2002 is discharged from this date.

22.

Any costs application by either party is adjourned to a date to be fixed upon the Court receiving any request in writing from either party provided such written request is forthwith served on the other party and is made to the Court before 3 September 2010.

23.

Each party has liberty to apply for consequential orders in relation to enforcement of the within orders.

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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