Tukac and Tukac

[2011] FamCA 225

FAMILY COURT OF AUSTRALIA

TUKAC & TUKAC [2011] FamCA 225

FAMILY LAW – Dispute over the return of a motor vehicle.  Motor vehicle leased.  Court not satisfied as to the capacity of the husband to return the vehicle having regard to the assignment of a lease by him.  Order for partial distribution of property as an alternative to enable the wife to obtain a motor car.  Not sufficient evidence for the husband to be entitled to a similar sum.

Family Law Act 1975 (Cth)

Strahan & Strahan (Interim property orders) [2009] FamCAFC 166

APPLICANT: Ms Tukac

RESPONDENT: Mr Tukac

FILE NUMBER: MLC 8898 of 2010

DATE DELIVERED: 31 March 2011

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: 30 March 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr P Davis

SOLICITOR FOR THE APPLICANT: Webb Korfiatis

COUNSEL FOR THE RESPONDENT: Mr Salamanca

SOLICITOR FOR THE RESPONDENT: Taussig Cherrie Fildes

Orders

1. That the husband and the wife immediately do all things necessary to direct the trustees of the trust fund holding the proceeds of the sale of the property at B Street, Suburb C to pay to the wife the sum of $20,000 to enable her to purchase a motor vehicle.

2. That the application of the wife filed 17 January 2011 and the response thereto filed on 30 March 2011 be otherwise dismissed.

IT IS CERTIFIED:

1. That pursuant to Order 19.50 of the Family Law Rules 2004 it was reasonable to engage counsel to attend.

2. That all extant applications for final orders be adjourned to a date to be fixed for determination at trial by a judge.

IT IS NOTED that publication of this judgment under the pseudonym Tukac & Tukac is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 8898  of 2010

Ms Tukac

Applicant

And

Mr Tukac

Respondent

REASONS FOR JUDGMENT

1. On 14 January 2011, whilst attending a dentist appointment, Ms Tukac (the wife) was advised that two men took away the motor car she had been using as the family car. It soon became apparent to the police to whom she reported the loss that the persons who took the car did so under some legal arrangement.

2. On 11 January 2011, the solicitors for Mr Tukac (the husband) wrote to the solicitors for the wife indicating:

   a)the husband has resigned from his employment;

   b)his employer required him to return company vehicles including that in the possession of the wife;

   c)the husband would contact the wife to arrange a suitable time to collect the vehicle.

3. On the same day, the wife’s solicitors wrote to the husband’s solicitors asking how it came to pass that the vehicle in the wife’s possession and use for several years came to be owned by the husband’s employer. The letter requested that no action be taken about the car until a satisfactory explanation was given.

4. The registered proprietor of the car according to the government records was and appears still to be, the husband.

5. With the car having been taken, the wife filed and served an application on 17 January 2011 seeking orders that the husband return it to her. The application was returnable on 28 January 2011. On that day, it was adjourned to 17 February at the request of the parties.

6. On 17 February, the matter was further adjourned on the basis that the whole case had settled and a further return date was required for the presentation of minutes. That date was to have been 28 March.

7. On 28 March, everything appears to have come undone and the wife indicated to the Court through her counsel that she did not accept the matter was settled nor the position put by the husband; she wanted to proceed with her application for the return of the car.

8. The husband then filed a response to the wife’s application seeking it be dismissed but that each party have $20,000 advanced to them from the capital held in trust from the sale of the former home. The husband filed an affidavit which addressed the accusations of the wife that he had been involved in the removal of the wife’s car.

9. Thus, the matter came before me on the limited issues of the car and the advance of funds on 30 March 2011. I permitted a limited cross-examination by and of, each party.

10. Even with limited cross-examination, it is difficult to make findings of fact in this case because the evidence arose was almost entirely from what was said by the parties and from some documents that the husband had produced. I am not at all convinced that I have the full picture of what occurred and am not at all comfortable to make the sort of findings urged upon me by counsel for the wife.

11. Accordingly, I am making findings based on what is clear on the evidence. I propose to deal first with the car issue.

12. In May 2006, the husband went interstate to acquire a car which was intended to be leased for the use of the family. At that time, the husband was the sole director of a company involved in arranging the financing of motor vehicles predominantly for the medical profession. In acquiring the car which I find was almost exclusively for the use of the wife, the husband entered into a lease of the vehicle with AFM Mortgage and Finance which had an agency agreement with Macquarie Leasing Pty Ltd. As may have been expected, the lease payments were met by the husband’s company.

13. There is no doubt in my mind that the owner of the car was Macquarie Leasing Pty Ltd.

14. Evidence was produced by the husband to explain why the car was registered in his name. An annexure to his affidavit from Macquarie showed that a “VIN” number had incorrectly been supplied to them. In my view, it matters little because the registration details of the vehicle must be seen only as prima facie evidence of ownership and in this case, the evidence clearly points to the true owner as being Macquarie.

15. In or about July 2010, the husband did two significant things. First, he entered into an assignment of the lease to D Pty Ltd. This assignment appears clumsily drawn because of its terms but it is acknowledged by Macquarie as having occurred. Macquarie in so acknowledging the assignment maintained that there had been no alteration to its ownership.

16. The curious and confusing thing that arose out of the purported assignment of the lease was that it said that D Pty Ltd was taking on the obligation of the outstanding rental of $10,625 and also the residual obligation under the original lease between Macquarie and the husband which was declared to be $30,257.

17. The original lease was for 61 payments and that would have seen the conclusion of the lease in June or July 2011. The assignment document referred to a $10,625 obligation which at $1308 per month would have ended the lease in January 2011. It will be remembered that in January 2011, the car was removed from the wife.

18. The second significant thing that occurred in July 2010 was that the husband put his company into voluntary liquidation and the business which it then conducted was resumed or continued by D Pty Ltd. This new company apparently had one director who was the 23 year old sister of the husband.

19. When asked why the assignment of the lease occurred, the husband said that he could not make the payments. When asked who the primary creditors were of the company in liquidation, the husband acknowledged that they were he and his sister. No evidence of the extent of nor the outcome of the voluntary liquidation was presented. The very fact that there was a formal liquidation of the husband’s company would suggest that there were at least liquidity problems. I do not know what, if any, consideration was paid by the husband’s sister for the business if it existed.

20. Accordingly, I am not in any position to determine whether, as asserted by counsel for the wife, the cessation of the business and its aftermath was a “sham”, “scam” or transaction to defeat any interest of the wife.

21. In or about July 2010, the husband took up employment with his sister’s company, D Pty Ltd Pty Ltd and his evidence was that as part of his package of employment, he could have the use of the car and the company would pay the payments. He had the use of a motor vehicle at work and which he drove at times when he had the children because they liked to go for rides in it and the wife’s vehicle was continued to be driven by her. The husband maintained that this arrangement was not only part of his package but it was also an arrangement concerning his support of the children. Whilst that might technically be the way the parties arranged their affairs, having access to luxury vehicles is hardly a proper arrangement for the support of children. Counsel for the husband pointed to the fact that that evidence was not challenged by the wife but having regard to the limitation I placed on cross-examination, nothing turns on that point.

22. What I do accept is that the wife was not privy to the precise details of the transfers of any property. The transfer of the vehicle was undertaken without consultation with her. It may be that such a transaction had little if any, effect upon the financial position of the wife. I am unable to determine that on this evidence.

23. The wife gave evidence and acknowledged being employed in the husband’s business but she maintained that she did not know the financial details of the operation. She said that that was the province of the husband and her role was about daily management. Again, having regard to the limitations on the evidence, there is no reason not to accept that.

24. The husband was employed by his sister’s company until 14 January 2011. His evidence was that upon his resignation becoming effective, the company of his sister demanded the return of all of the vehicles under his control.

25. Subsequent to ceasing his employment, the husband took up a consultancy with the same company relating to “FBT” and also had use of a company vehicle. His evidence was that he was paid a contract fee of $4,000. I was provided with no other evidence about his income but I note that he was renting an apartment for over $500 per week and said he is about to start up his own consulting company. In 2010, he went overseas for 3 weeks with a companion who he said paid the expenses. He said that his family was currently assisting him with his living expenses. It certainly appeared odd that he had the benefit of all of these things but the payments on the car could not have been met to ensure the wife and children were not affected. He pointed however to correspondence to showed that his family had been willing to assist. The husband and wife until separation had lived an affluent lifestyle with children in a private primary school. The husband said that he had been “advised by D Pty Ltd management” that they would not object to the wife taking a re-assignment of the lease on the basis that she was responsible for the payments. That would suggest that the company still had possession of the car but I would not take that as a generous offer because it was not made or at least made clear, until the day before the interim proceedings were heard. The husband maintained that he had had some sort of falling out with his sister and that they had had a disagreement about the registration of the car but not its collection whilst at the same time offered to make various arrangements to assist the wife.

26. There is no application before me for the husband to do anything other than return the car to the wife. I do not know whether there are any payments still outstanding having regard to the confusing picture I have outlined above nor whether Macquarie would be interested in transferring the car to the wife on payment of the residual. Thus, an order could only be made if I was satisfied that it could be carried out.

27. Notwithstanding the unsatisfactory nature of the removal of the car and the immediate response of the wife, I must find on the evidence that the car at all times belonged to Macquarie and that it was in the possession of the husband by virtue of his position as the renter. As I pointed out in discussion with counsel, the confusing picture of the two documents annexed to the husband’s affidavit gives rise to concerns that the vehicle may have been taken by Macquarie or that the residual on the lease may now have been paid out. The husband was silent on that issue including making any inquiries from his sister about the current position of the car. The fact that the vehicle is still registered in the husband’s name is perplexing but on the evidence, I accept that the interest of Macquarie had not been registered at VicRoads because of some technical problem with the “VIN” number. Thus, it would not be proper for the Court to make an order for the husband to return a car to the wife without being satisfied that he had the legal capacity to do so and the physical capacity to do so as well.

28. Whilst in a fully contested hearing, some findings of a general nature may be made which might throw some doubt upon the credibility of the witness, this is not such a case because of the limited cross-examination. As counsel for the wife observed, the husband’s evidence was being recorded and no doubt further inquiries would be made. That observation however, did not shake the husband’s stance.

29. Counsel for the wife submitted that I should find the whole of the husband’s case unbelievable because whilst he put all of the company control and its assets, if any, in the hands of his sister, no such evidence was produced to corroborate what he said. I do not accept that mainly because I accept that Macquarie was as at January 2011, the owner of the car.

30. The primary application of the wife must therefore fail.

31. The “default” position of the wife and one advocated by the husband, was that each party should take $20,000 from the trust funds to enable the purchase of cars. There was no dispute from the husband’s position that the wife needed a car. The husband’s evidence was that he did not have the funds to “procure” a car but that is not evidence that I would take as justification for making a partial distribution of property order.

32. Counsel for the wife was reluctant to see an order made which would deplete the very limited pool of assets but maintained that the wife needed a car.

33. For me to make an order for a partial distribution of property, a number of steps need to be established. In Strahan & Strahan (Interim property orders) [2009] FamCAFC 166, the Full Court said that although the power under s 79 should ordinarily be exercised on a once only basis, circumstances may arise before there can be a final hearing where the power is required to be exercised.

34. The first step is to resolve whether to exercise the power before a final hearing and if it is resolved to do so then the second step involves the exercise of that power.

35. In this case, I am satisfied on the evidence that the exercise of the s 79 power should be exercised in favour of the wife having regard to the evidence to which I have referred to enable her to acquire a car. The exercise of the power enables the Court to order the funds in trust be so distributed to her.

36. The Full Court in Strahan went on to say:

    Thus, a consideration of the need for and effect of interim orders weighed against the risks that the exercise of the power on an interim basis will interfere with the power of the court to make “just and equitable” orders on a final basis is required. Importantly, the considerations that may weigh in favour of such an order should not be considered to be limited, but must be determined on the facts and circumstances of each case. In this case, having regard to the size of the proposed distribution, the urging of the husband and the lack of evidence from the husband about contribution, satisfies me that a just and equitable outcome at trial could still be achieved notwithstanding the order I propose to make.

37. Normally one would require evidence of matters set out in ss 79 and 75(2) but that was not raised by either party as a problem.

38. Turning then to the husband’s proposal for release of funds to him, apart from his evidence about not having a car, there is no concession by the wife. Under those circumstances, I could not justify the exercise of the power to make an order in his favour.

39. I will order that each party immediately do all things necessary to direct the release to the wife of the sum of $20,000 by way of partial distribution of property and such sum be taken into account at trial as the trial judge sees fit.

40. The proceedings will otherwise be dismissed.

I certify that the preceding Forty (40) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 31 March 2011.

Associate: 

Date:  31 March 2011