Vadisanis and Vadisanis

[2009] FamCA 121

FAMILY COURT OF AUSTRALIA

VADISANIS & VADISANIS [2009] FamCA 121

FAMILY LAW – CHILDREN – With whom children live – With whom children spend time
FAMILY LAW – COSTS – Interim costs

Family Law Act 1975 (Cth)

APPLICANT: Ms Vadisanis

RESPONDENT: Mr Vadisanis

FILE NUMBER: SYC 6377 of 2008

DATE DELIVERED: 5 February 2009

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: LOUGHNAN JR

HEARING DATE: 4 February 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Givney

SOLICITOR FOR THE APPLICANT: Campbell Paton & Taylor

COUNSEL FOR THE RESPONDENT: Mr Watkins

SOLICITOR FOR THE RESPONDENT: CM Lawyers

Orders

1. The proceedings are adjourned for hearing if practicable to the Judicial Registrar’s Call-over at 9:30 am on 23 February 2009.

2. That until 6:00 pm on 23 February 2009, the children M born … March 1998 and R born … June 1999, live with the mother from after school this day until 12:00 noon on Sunday, 8 February 2009 and from the conclusion of school on Friday, 20 February 2009 until 6:00 pm on Sunday, 22 February 2009.

3. At all other times unless the parties agree to the contrary the children are to reside with the father.

4. That as soon as practicable the father sign all documents and do all things necessary to direct his solicitor to pay to the solicitor for the wife $10,000 and to pay $60,000 into the facility secured on the W property.

5. The character of the payment of $10,000 which is in the first instance by way of interim costs, is a matter for the Trial Judge or Judicial Registrar at the final hearing.

6. The parties are restrained from discussing these proceedings, except as may be necessary for the children to attend upon their representative, with the children or in the presence of the children, and from showing the children any document associated with these proceedings.

7. The parties are restrained from making derogatory remarks to or in the presence of the children in relation to the other parent or any member of the family of the other parent.

8. Pursuant to Section 68L of the Family Law Act 1975 an Independent Children’s Lawyer be appointed for the children M born … March 1998 and R born … June 1999.

9. The Legal Aid Commission of New South Wales is requested to make arrangements as soon as possible for appropriate representation for the children.

10. The solicitor for the father is to advise the Senior Solicitor, Family Law Litigation Section of the Legal Aid Commission of New South Wales of this order within 24 hours.

11. Each party make available to the Legal Aid Commission of New South Wales, within 7 days, copies of all applications and affidavits upon which that party relies together with any existing orders and copies of any relevant reports.

12. That the parties make arrangements for the children to attend upon their representative at times, dates and places requested by their representative.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 6377 of 2008

MS VADISANIS

Applicant

And

MR VADISANIS

Respondent

REASONS FOR JUDGMENT

1. These are proceedings in relation to - or associated with proceedings for settlement of property and parenting issues.

2. The wife and husband I think are 40 and 38 years of age, respectively.  The wife is a Registered Nurse.  The husband is currently unemployed.  They started to live together in November or December 1996, married in February 1997 and separated on 6 September last year.  They have two children; M who I think I was told yesterday they call something else. She was born in March 1998 and is nearly 11 years of age. R was born in June 1999 and is a bit over nine and a half.

3. In September last year the parties signed terms of consent providing that the children would live with the wife in E on alternate weekends and all of the school holidays and at all other times they would live with the husband in Sydney.  Orders were never made in terms of that document. 

4. As I understand it, the parties originally met in Sydney. The wife’s father was ill and so they moved to the Central West area. They lived in D and E.  I think at one point the wife and children might have lived in D and the husband was working in E. In any event they lived in that area up until separation. 

5. I am asked to determine a relatively small issue today. The parties have not attended counselling and I have ordered that. An Independent Child Lawyer is needed and the matter will be adjourned to 23 February.

6. The parties could not agree about the arrangements until then.  They have virtually agreed the arrangements now. 

7. Basically the parties are content that the children will be with the mother for alternate weekends until the hearing.  The mother wanted to take the children back to E this weekend.  She is in Sydney and I suggested that would be an unnecessary trip. She has accommodation with her brother in Sydney as a base for her time with the children. She will have the children until this Sunday, return them to the father, and then she will go home. She will have the children for the weekend leading up to the hearing, that time to be spent in Sydney.  The only issue is whether her time starts today or tomorrow and it might as well start today.

8. The worrying aspects of the case are highlighted in the parties’ documents.  I was told by counsel yesterday that there is a horrifying level of allegation made, one party against the other, and that is true. These children are in harm's way unless the parties are liars.  That is what it boils down to.  If either of the parties is telling the truth; the children have lived in an atmosphere of abuse for years.  It is possible that they are both lying, that they are both exaggerating but I have a horrible feeling they are not. The parties need to brace themselves because a Family Consultant is going to tell them that they have done some real damage to their children.  I do not know that the science exists to fix it.  We will see as the months go on.  Somebody will be in the touch with the school counsellors and the children will be seen and we will get an expert in and we will see where we go from there. 

9. All aspects of the behaviour that each of them describes in the affidavits has to be hidden from the children from now on. If the parties were able to simply put a stop to those behaviours then presumably they would have done so long before now. It might be that they only behave badly when together.  That does not seem likely to me but it is possible I suppose. Perhaps the children now live in quiet households, quiet environments without the parents being in the one place. In any event the parenting issue is resolved.

10. The other issue relates to property. The parties own properties.  There were lines of credit against the properties.  The husband says that his previous solicitor told him that he should draw significant amounts on the lines of credit or on these facilities to prevent the wife doing it.  So he took out about $132,000 - took out $18,000 on one property and $70,000 on a property at W.  The wife's assertion is that that increased the parties' repayments by about $1000 a month.

11. I was left to understand yesterday that there was a substantial sum in an interest bearing account in the husband's name. When we come to Court today we are told that it is all gone. $70,000 has been left in his solicitor's trust account, $45,000 has been repaid to his mother and the rest of it has been spent on various expenses; including the children's expenses. 

12. There has been a principle about status quo in parenting issues but there is no such concept in relation to property cases.  There is no obligation for anybody to leave things as they were after separation. However, this problem arose because the husband was told that it would be smart to take this money because it would stop the wife taking it and using it, wasting it, destroying it. That is exactly what the husband has done as to all but $70,000. Until the Court makes a decision to the parties reach a settlement, this is the parties’ money.  Every dollar is the parties' money. Just as he was afraid that the wife might waste the money, the husband must understand that it was entirely inappropriate that he has dealt with this money.

13. When parties are together they do things with joint funds and that is fine.  They are in the same interest.  When parties are separated, they are not only not in the same interest, they have a conflict of interest. It is not then open to one of them to say:  "I have a debt.  I didn't bother paying it the day before we separated but now after separation I think it would be smart to pay it off."  That should not have been done. 

14. There is no suggestion in the documents that there was any agreement to repay the money on a particular date. There is a long-held principle that if a party is on notice that an injunction will be sought to preserve a certain fund then it is entirely inappropriate for that person to deal with that fund without notice to the other party prior to that matter coming on for hearing. In this case I am told without complaint, that on 15 January the wife was told through her solicitors that the husband's solicitors were confident that they would have instructions to reinstate the fund. The wife’s solicitors were asked to hold off making an application to the Court. It is very unfortunate if reliance cannot be placed in a solicitor’s representations about a thing like that. It a solicitor becomes aware that the representation is not accurate, that solicitor is obliged to put the other side on notice. The wife’s solicitor should have been told that the funds would not be repaid. 

15. The other issue arises from the reason for a Mareva Injunction; that is to preserve the thing that the Court will be deciding about. As I said to Mr Givney, without winning him over on the point; even if all of this $132,000 disappeared, I do not think it can be said that the wife's proper claim cannot be met out of the remaining assets.

16. True it is, there is a risk that arguments about add-backs and preliminary distributions can get lost in the wash. The general proposition is that the assets and debts be identified on the day of the hearing. However, the authorities are still good.  Townsends case and the authorities in relation to waste are still good law. Here the husband has put the fate of these funds on the record and he can be tested against it.

17. What is left of the funds is $70,000 in the husband’s solicitor's trust account.  The wife would like $10,000 to apply to her own legal expenses.  The husband would like $25,000 to apply to his legal expenses. The husband says he has $14,581 in accounts that he has not met, including rent, tax payments and interest payments. Further and for reasons that are not explained in his affidavit and despite it being one of the reasons he decided to return to Sydney with the children, he does not have any income. Thus the husband was planning to draw on this fund for his living expenses. That can no longer be his intention because he gave the entire residue of the fund to his solicitors. He must have a plan for paying the $14,581 in additional expenses from some other source. He must have a plan to obtain another source of funds for his living expenses.

18. It is submitted for the wife that there is a front door for the husband’s desire to meet legal expenses. If he wants interim costs then he could make an application for it. In circumstances where he was so comfortable as to pay off a debt to his mother that was not called in, perhaps he should not be given that indulgence in any event. If he needs money for living, then he account for that in the normal way and either asks for the release of joint funds or for an order for spousal maintenance.

19. And all of this occurs in the context of a modest pool of assets.  People arguing over $800,000 in the civil jurisdiction would not normally do that in the Supreme Court. Unfortunately the parties are here because their marriage has broken down. The costs in this jurisdiction are significant and although not as apposite for parenting cases, in property settlement proceedings there needs to be some sense of proportion between the costs of identifying how the money should be divided and the value of the assets. 

20. On the husband's case; he has made the greater contribution. The husband has sought to address part of that by paying money to his mother. Another approach might have been to accommodate that point in the calculation of contributions and so the division of assets would be affected by it. If more of the pool of assets will ultimately go to the husband than the wife, then he may be more at risk in relation to costs than the wife. 

21. So doing the best I can with this, I think a proper outcome in the circumstances is that of the $70,000 in the husband's solicitor's trust account, $10,000 be paid to the solicitor's for the wife by way of interim costs.  The character of that payment to be determined by the trial judge. The remaining $60,000 should be paid back in the most efficient way into the facilities secured by the properties. 

22. As is said on behalf of the wife; in the circumstances where decisions have been made without any discussion or approval from the wife, it is a matter for the husband how he manages his liabilities and living expenses. He must have had a plan because he had put $70,000 beyond his use for living expenses or beyond his use for the payment of $14,581 in outstanding payments. He must have had a plan for those things to be paid from some other source.

I certify that the preceding twenty two (22) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan

Associate: 

Date:   24 February 2009