VERDINCK & STEVENS

[2016] FamCA 792

FAMILY COURT OF AUSTRALIA

VERDINCK & STEVENS [2016] FamCA 792

FAMILY LAW – PROPERTY - Interim distribution – Where applicant unable to meet legal costs –Orders made under s 90SM granting interim property distribution.

FAMILY LAW – SPOUSAL MAINTENANCE – Interim – Where evidence of earning capacity insufficient to make a determination – Where s 90SF threshold not met – Application for interim spousal maintenance refused.

FAMILY LAW – INJUNCTIONS - Preservation of property – Where s 114 injunction is in place - Where restraint no longer “proper” or “just or convenient” – Injunction discharged.

Family Law Act 1975 (Cth) ss 72, 90SF, 90SM, 114

Hall v Hall (2016) 332 ALR 1
In the Marriage of E F and R Zschokke (1996) FLC 92-693
Strahan & Strahan(Interim Property Orders) (2011) FLC ¶93-466
M v DB (2006) FLC 93-293

APPLICANT: Ms Verdinck

RESPONDENT: Mr Stevens

FILE NUMBER: CAC 1415 of 2015

DATE DELIVERED: 20 September 2016

PLACE DELIVERED: Canberra

PLACE HEARD: Canberra

JUDGMENT OF: Gill J

HEARING DATE: 6 September 2016

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Howard

SOLICITOR FOR THE APPLICANT: Yeend & Associates

COUNSEL FOR THE RESPONDENT: Mr Tockar

SOLICITOR FOR THE RESPONDENT: Dobinson Davey Clifford Simpson

Orders

1. That within 7 days the respondent pay to the applicant the sum of $25,000.

2. Order 1 of the Minute of Orders of 16 June 2016 is amended to now be as follows:

   (1)      The respondent is restrained from disposing of:

   (a)Any items of real property in his sole name or in the name of Stevens Pty Ltd;

   (b)Shares including any shares in companies;

   (c)Cash and funds in bank accounts in his personal name other than income from his employment.

3. Order 2 of the Minute of Orders of 16 June 2016 is discharged.

4. The application for orders 1-10 inclusive per the minute of orders of 6 September 2016 sought by the applicant (Exhibit A1) is otherwise dismissed.

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 Verdinck & Stevens 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 CANBERRA

FILE NUMBER: CAC 1415 of 2015

Ms Verdinck

Applicant

And

Mr Stevens

Respondent

REASONS FOR JUDGMENT

1. This case involves proceedings between the applicant and respondent, principally pursuant to s 90SM of the Family Law Act 1975. The parties were in a de facto relationship for a number of years.  Proceedings were commenced in the Federal Circuit Court by Initiating Application filed on 8 September 2015 and were transferred to the Family Court of Australia on 16 June 2016.  At the time of transfer interim injunctive relief was granted to the applicant.

2. The applicant seeks orders in accordance with her Minute of Orders Sought marked as Exhibit A1 in the proceedings. Principally, she seeks orders for an interim property distribution pursuant to s 90SM of the Family Law Act 1975, orders for interim spousal maintenance pursuant to s 90SF of the Family Law Act 1975, and orders that prevent the respondent from occupying a house in Suburb B in the Australian Capital Territory that is owned by Stevens Propriety Limited (the Company), a company that the respondent is the sole director and sole shareholder of.

3. The respondent plans to move into the Suburb B house with his recently widowed mother.  He accepts that he will have to pay rent in the sum of $800 per week to the Company to avoid a Fringe Benefits Tax issue.  The effect of this is that the Company will rent the property to him at a rate that is less than the previous tenant paid ($1250 per week).   

4. Further orders are sought by the applicant in aid of these orders and also to allow the payment of the sum of $3,199.50 from an account of the Company to the applicant. 

5. The respondent opposes the making of any of these orders.  He further seeks that an injunction made on 16 June 2016 be amended in general terms to allow him to draw upon the Company’s assets (other than real property) for his own purposes.[1]

   [1] Response to an Application in a Case filed 5 September 2016.

Material relied upon

1. The applicant filed an Outline of Case on 2 September 2016 indicating that the following items were relied upon:

   a)Affidavit of Ms Verdinck affirmed 19 July 2016.

   b)Financial Statement of Ms Verdinck affirmed 19 July 2016.

   c)Affidavit of Mr Verdinck sworn on 9 June 2016.

   d)Affidavit of Ms Verdinck affirmed 10 June 2016

   i. Paragraphs 7 – 12 (including annexures referred to therein); and

   ii. Paragraphs 20 – 24 (including annexure G, pages 55-56).

   e)Affidavit of Ms Verdinck to be filed 5 September 2016.

   f)Financial Statement of Mr Stevens affirmed 7 June 2016

   i. Part N – notes under heading “Other necessary commitments” this partial reliance does not mean that every expense asserted by the Respondent is accepted by the Applicant; and

   ii. Part O – Note 2 headed “Annexure Note 1”. Part of this note is objected to as it relates to the asserted taxation consequences of withdrawing funds from Stevens Pty Ltd.

   g)Financial Statement of Mr Stevens affirmed 9 August 2016 – Part O.

2. In addition, the applicant tendered a bundle of tax invoices regarding the Company which is marked as Exhibit A2 and filed in Court along with a Notification of Costs document. Additionally, during the proceedings the applicant referred to the respondent’s trial affidavit at page 19 and the wife’s trial affidavit at [103].

3. The applicant was granted leave to file further material regarding the terms of her legal representation.  An affidavit by her solicitor, Gillian Yeend, was filed.  The respondent indicated that he did not seek to either adduce further evidence or make further submissions in relation to this material.   

4. The respondent relied upon evidence as set out at paragraph 2 of his Outline of Case Document as follows:

   2.1 Affidavit of the respondent sworn on 9 August 2016 and filed on 10 August 2016;

   NB. In respect of the respondent’s affidavit, only the following paragraphs are relevant to the current Application:

   ·paragraphs 1 – 24, 26 – 27, 29, 273, and 288 (background);

   ·paragraphs 88, 189 – 190, 202 & 254 – 256 (applicant’s employment);

   ·paragraphs 111–128 & 285 (separation in 2006 and ‘Separation Agreement’);

   ·paragraphs 130 & 131 (purchase of Suburb B property);

   ·paragraphs 132 –134 (purchase of the Property C property at D Town);

   ·paragraphs 145–156, 166 & 177–181 (Property C joint project);

   ·paragraphs 160 – 161 (Property C living arrangements);

   ·paragraphs 203–207, 212– 214, 292 & 294, (applicant’s spending);

   ·paragraphs 242–253, 269 & 303 (respondent’s financial and living circumstances and child support);

   ·paragraphs 257 & 260 (child support).

   2.2 Financial Statement of the respondent sworn on 9 August 2016 and filed on 10 August 2016.

   2.3 Updating Affidavit of the respondent sworn and filed on 2 September 2016.

5. Additionally, he relied upon [287], pages 270-271, page 547, [224] – [227] and [243], annexure E and page 180 of his primary trial affidavit.

Interim distribution pursuant to s 90SM

1. The application for an interim distribution is directed towards funds held in an account of the Company.  At the time of the hearing the balance of that account was approximately $40,000.

2. The law governing the making of an interim property distribution was set out in the Full Court case of Strahan & Strahan (‘Strahan’).[2]    In Strahan[3] it was held that it is necessary to identify the relevant source of power to found the application before the Court, in order to identify the conditions that are placed upon the powers exercised. 

   [2]Strahan & Strahan(Interim Property Orders) (2011) FLC ¶93-466.

   [3]Strahan at [84].

3. In this case the applicant specifically relied upon s 90SM and asserted that what was being sought was an adjustment of property interests. The application for a distribution was based upon the notion that the applicant required the funds to defray legal expenses.

4. Section 90SM empowers the Court to make such orders as is appropriate provided that it is just and equitable to do so. The necessary considerations are set out at s 90SM(4) which includes reference to s 90SF(3).

5. Strahan sets out two steps at [118] that are to be followed in determining the exercise of jurisdiction on a partial basis. The first step involves asking whether the jurisdiction will be entertained. The overarching consideration in determining whether or not to exercise the jurisdiction is that it be in the interests of justice to do so. This takes place in the context that it is generally preferable for there to be a single exercise of the power under s 90SM rather than a fragmented exercise of the power.[4]

   [4]Strahan at [114].

6. Overcoming this preferential position does not require compelling circumstances.  It does, however, require that it is in the interests of justice to depart from the preferable position. 

7. In this case the interests of justice component that was identified to justify the fragmentation of the exercise of the power is as set out in the Full Court case of In the Marriage of E F and R Zschokke.[5]  For the applicant it was asserted that the circumstances fall within the three matters that were identified in Zschokke as relevant to an interim distribution for the payment of legal expenses.  These three factors are as follows:

   a)An assessment of the relative financial strength of the parties.

   b)The capacity of the respondent to meet the respondent’s legal costs.

   c)The incapacity of the applicant to meet the applicant’s legal costs. 

   [5]In the Marriage of E F and R Zschokke (1996) FLC 92-693.

8. It was put that, as the circumstances fell within what Zschokke identified in these three tests, it is in the interests of justice to determine a partial property distribution at this stage.

9. Should the question of whether the jurisdiction ought be exercised at an interim stage be resolved in favour of the applicant, then a second step is identified in Strahan.  That second step is to ask how the power will be exercised in accordance with the relevant considerations as set out at s 90SM(4) including s 90SF(3). The consideration of those matters on an interim basis may be brief, and focused upon the likelihood of whether the claim made will ultimately be met.[6] Helpfully, counsel for the respondent indicated that the claim for an interim distribution by the applicant fell within this description. 

   [6]Strahan at [137].

10. Given the concession in relation to the second issue, the key issue to be determined is whether or not the first step as set out in Strahan is met. 

11. The respondent contested that this first condition set out in Strahan has been met.  The principal areas of contention relate to whether or not the respondent has a capacity to meet his legal expenses and whether or not the applicant has an incapacity.  The answers to these questions are to be taken in part from the manner in which the parties addressed the question of spousal maintenance.

12. The findings in relation to spousal maintenance set out below are such that I have been unable to find either that the applicant has an inability to support herself, or that the respondent has a reasonable ability to support the applicant.  From the analysis below I am unable to be satisfied that either of the parties is able to fund their cases from income received from employment.

13. The evidence in relation to the current state of legal representation is as follows:

    a)In about June 2016 the respondent drew approximately $90,000 from the Company account and used it to pay legal fees.[7]

    b)The applicant has paid legal fees by borrowing funds from her father.  The amount she can borrow from him is $100,000.  To date she has borrowed $85,000 from this resource.[8]  That is, the applicant has a further $15,000 available to her from this facility;

    c)The applicant’s further legal fees are estimated by her at $40,000.[9]

    d)An affidavit of Gillian Yeend, the solicitor for the applicant, deposed that she had not agreed to defer legal fees for the applicant and would not do so.

    [7] Applicant’s affidavit 22 July 2016 [25] and Applicant’s affidavit  of 5 September 2016 [22-24].

    [8] Applicant’s affidavit of 14 June 2016 [22-23].

    [9] Applicant’s affidavit of 5 September 2016 [24].

14. This leaves the applicant in the position that she faces a shortfall in her ability to fund her legal representation, even should she draw down fully upon the loan offered her.  On the current estimate as contained in her affidavit, she will be $25,000 short on the balance of the $40,000 legal fees.  For the respondent, evidence is not put forward to suggest that he has a like threat to his legal representation.

15. Considering the matters indicated in Zschokke, as to the first matter, the parties are both constrained in respect of their financial resources.  The bulk of the pool appears to be tied up in real property and superannuation.  To the extent that the husband is in control of real property via the Company, he is enjoined from disposing of it and no application has been made to release him from that restraint.  The identified liquid sources are limited to the funds identified in the Company account.  While there is disparity in their ability to earn income, there is also disparity in relation to their requirements for self support and, for the respondent, to support the children, such that there is little practical differential between them.

16. As to the second matter set out in Zschokke, while I have not found that the respondent has the ability to meet from his income his legal fees, there is no evidence that the terms of the provision of legal services for him are such that he is unable to retain his representation.  Unlike the applicant, there is no evidence of a refusal to act on a deferred basis by his lawyers.  Practically, there is no incapacity pointed to on the part of the respondent in relation to the further conduct of his litigation.

17. As to the third matter, the evidence set out above establishes the inability of the applicant to meet her legal fees.

18. In combination, these matters justify a departure from the usual approach of the exercise of the s 90SM discretion on a single occasion.

19. Noting the concession previously (and reasonably) made that a payment in the sum sought by the applicant would fall within the ambit of an ultimate distribution, both the first and second aspects of the Strahan requirements are met.

20. I will make orders that will cause a sum to be paid to the applicant in an amount that corresponds with her inability to meet her legal costs, that is, in the sum of $25,000.

Interim spousal maintenance pursuant to s 90SF

1. In order to justify an order for interim spousal maintenance, two threshold matters must be addressed that relate to the capacity of the applicant and the capacity of the respondent.  In Hall v Hall the High Court determined that: [10]

   A court exercising the power to make an interim order under s74(1) must be satisfied of the threshold requirement in s 72(1) and must have regard to any matter referred to in s 75(2) that is relevant…..A court determining an application for an interim order under s 74(1) cannot make such an order without finding, on the balance of probabilities on the evidence before it, that the threshold requirement in s 72(1) is met having regard to any relevant matter referred to in s 75(2).

   [10] Hall v Hall (2016) 332 ALR 1 at [8].

2. The first obligation placed upon the applicant is to prove the threshold matters of incapacity on her part and capacity on the part of the respondent.

3. The applicant’s self support requirements are approximately $780 per week.[11]

   [11] Relevant portions of Parts G and N of the Applicant’s financial statement of 20 July 2016.

4. The applicant receives Centrelink benefits and child support payments.  The child support payments are not referable to her ability to support herself, in the same manner that expenses relating to the upkeep of the children are also not a part of the expenses incurred in support of herself.  The Centrelink benefits are unable to be taken into account as part of the applicant’s ability to support herself.  She has borrowed from her father for legal costs.

5. The applicant owns a business that operates at a loss.  She has had intermittent experience in the paid workforce but has recently obtained a casual job.  She has led evidence indicating that the jobs the respondent asserted might be suitable to her were not. Other than the fact of the acquisition of the above position, she has led no evidence as to efforts on her part to derive an income, other than a commitment to the business she operates.  What this commitment practically involves was not the subject of evidence.  On her evidence it can safely be found that she has at least a current capacity to earn an income from her casual job.  This is currently 8 hours per week at $19.44 per hour, a gross figure of approximately $156 per week.  It cannot be inferred that this is her only capacity.  If full time work of this ilk were available (it is not established one way or the other) then the gross earning capacity, at that rate approximates $740 per week.  The evidence does not establish the availability or unavailability of work at this or at a higher or lower level of remuneration.  It does not establish whether work of this sort is or is not available for more hours each week.  It does not establish efforts to procure work.  

6. The applicant asserts that she ought not take full time employment away from the home due to her care of the children and their vulnerability.[12]  Both children have had significant time off school.  It is accepted that one child suffers from atypical anorexia nervosa and requires additional support.[13]  It may be accepted that the applicant needs to be available to support this child, although the extent of the necessary availability has not been established.  It has not been set out what impact the children’s needs have on the mother’s need to be present. 

   [12] Applicant’s affidavit of 5 September 2016 [6(f)].

   [13] Applicant’s affidavit of 10 June 2016 [75-91].

7. It is unclear how this affects the reasonable work arrangements for the applicant.  The applicant explains that the children are away from the home for at least the school day plus half hour travel each way to school.  The work the applicant has undertaken spans outside school hours.  Further in relation to her ability to undertake paid employment, the applicant resists taking work that might conflict with the business she seeks to establish.  The applicant has not led evidence in relation to either of these matters sufficient to demonstrate the nature of a limitation on her ability to undertake further paid work.

8. The burden of making out the threshold matter of being unable to support herself rests upon the applicant.

9. From the evidence led I am unable to determine the applicant’s capacity to derive income.

10. That is, the applicant has failed to establish her capacity and hence, as a corollary, the degree of her incapacity, to derive an income that will allow her to meet her self support requirements.

11. For the respondent, the evidence establishes that he has available to him work at an hourly rate of $114.16.  This is said to equate to an annual income of approximately $240,000.[14]  However, the respondent indicates that there are limitations in respect of the income he earns.  The income is only payable when he is working, there being no leave arrangements.  Further, the contractual nature of the employment means that there is no guarantee as to the number of hours that he may be offered.

    [14] Applicant’s affidavit of 14 June 2016 at p55.

1. The evidence relevant to the respondent’s assertions is as follows:

   a)In December 2015 he was paid approximately $12,000.[15] If this reflected his income through the year, he would receive approximately $144,000 not $240,000.

   b)The respondent was out of contract in July 2016.[16]

   c)His tax return indicates his income for 2014-15 was $113,000.[17]

   d)His tax return indicates his income for 2013-14 was $134,000.[18]

   e)He asserts that his current contract expires in January 2017,[19] although it is expressed as continuing until the end of the financial year.  That is, it is not the case that the respondent expects to spread the 120 hours across the rest of the financial year, but rather to complete the 120 hours by January 2017;

   f)The extent of the current contract is for 120 days of work.[20]  If not renewed, this equates to 120 days of 8 hours a day at $114 per hour, amounting to a total contract value of approximately $110,000.

   g)It is anticipated that the contract amount will be increased.[21]

   [15] Ibid.

   [16] Respondent’s affidavit of 10 August 2016 [242].

   [17] Ibid [243].

   [18] Ibid [224].

   [19] Ibid [242]

   [20] Applicant’s affidavit of  2 September 2016 Annexure E.

   [21] Ibid.

2. The opposing positions as to the respondent’s income were as follows.  For the applicant it was said that his income is currently at a rate of $240,000 per annum and that this will continue until the end of the contract.  There is uncertainty after that point.  The position for the applicant is that I should take the income at its current level and disregard the uncertainty in assessing whether the respondent is reasonably able to support the applicant.

3. For the respondent it was put that, because there is uncertainty as to a further contract and that the income received by the respondent is in truth well below $240,000 per annum.  The income should, according to the respondent, be assessed on the basis that there may be no further contract and that the income will be close to that disclosed in the previous two financial years.

4. In relation to income, it is also put by the applicant that the Company has the ability to derive rent of $1,250 per week from the Suburb B property that it owns and that the respondent seeks to move into.  This appears to be a gross figure that does not indicate the actual income that is received.  The respondent asserts that this is best understood from the profit and loss statement that discloses gross profit in 2015 at approximately $17,000 and for 2014 at approximately $22,000.[22]  On a weekly basis, this appears to provide the Company with additional income of approximately $400.  The applicant asserts that the income from the property is better understood from the fact that the Company account held approximately $120,000 in it before the respondent withdrew the $90,000 as described previously.  The ability to accumulate the funds indicates that the income earning on the part of the respondent, from whatever source, exceeds his expenses.

   [22] Respondent’s Affidavit of 10 August 2016  Exhibit BS-44.

5. The respondent’s current need to support himself is set out in his financial statement of 10 August 2016.  He asserts a total weekly expenditure of $4,153.  This includes his support of the children, an amount for rent (not yet being incurred) and an amount for rental of a motor vehicle on the basis that his car is broken.  The applicant’s evidence is that there is another vehicle available to the respondent and so I do not accept that the rental of a motor vehicle is a necessary expense.  This brings the weekly expense amount down to approximately $3,840.  I note that once the car rental and rent of a property are taken out from the respondent’s Part N, it is close to that asserted by the applicant.

6. The respondent now faces the need to obtain accommodation.  That is to be in the form of furnished rental accommodation.  There is some dispute as to what this will cost, as the figures referred to by the respondent range between approximately $600 per week and $800 per week.

7. If the respondent’s income is best understood as being close to the $240,000 per year level, with an additional amount in the order of $20,000 per year by way of profit from the rental of Suburb B, then he has a capacity in excess of his need to support himself and the children.  If his income is closer to the $140,000 per year, again with the additional $20,000 from Suburb B, he is not reasonably able to maintain the applicant.

8. The onus lies upon the applicant to establish the second threshold issue pursuant to s 72 of the Act, that is that the respondent is “reasonably able to” maintain the Applicant.  There is significant uncertainty as to which of the above positions represents the capacity of the respondent.  I am not satisfied, on the balance of probabilities, that he has a reasonable ability to support the applicant.

9. Accordingly, I am satisfied of neither of the threshold matters that it is necessary for the applicant to establish to justify making an order for spousal maintenance. The application for spousal maintenance is therefore refused.

Discharge of the injunction

1. The power to grant relief by means of injunction is contained at s 114 of the Act.  The section conditions the use of the power with respect to the property of either of the parties to a de facto relationship at s 114(2A)(c) as “proper” or, in respect of matters other than a matrimonial cause (as here), as “just or convenient” in s 114(3).

2. The proceedings here involve two restraints upon the respondent, each in relation to the Company.  One restraint is from dealing with funds of the Company under his control.  Given the orders to be made in relation to those funds, the significance of this restraint is diminished.  The second involves both restraining the respondent from occupying the Suburb B residence and causing him to have it leased to somebody else. 

3. An injunction restraining the use of property requires justification on the basis that it is proper, or just and convenient to restrain. [23]  Generally, but not always, that involves the identification of a “risk of disposal of assets to defeat an order” either by establishing an intention to defeat a claim or otherwise.[24] Here, that necessarily involves the applicant identifying a claim pursuant to s 90SM and establishing that there is a danger that the claim may be prejudiced without the making for the restraint.

   [23]M v DB (2006) FLC 93-293 [46].

   [24]M v DB (2006) FLC 93-293 [48-50].

4. By injunction, granted primarily by consent by the Federal Circuit Court on 16 June 2016, the respondent was restrained, save in particular circumstances, from dealing with his property and the property of Stevens Pty Ltd (the Company), of which he is the sole director and shareholder.  Each of the parties sought some change to the terms of the current restraint.  The applicant sought the ability to pay certain expenses from the Company account.  The respondent sought a discharge of the restraint in respect of his ability to deal with the property (other than the real property) of the Company. 

5. There was no suggestion made before me that the subject matter of the restraint was anything other than the property of the respondent.  The terms of the changes to the restraint proposed by the applicant, to allow the respondent to comply with orders altering property interest in favour of the applicant, and discharging a maintenance obligation sought against him, implicitly indicate that, but for order of the court, the restraints are upon property the respondent is otherwise entitled to.

6. As to the issue of the payment of certain expenses, I was left in some uncertainty as to the scope of agreement between the parties as to the relaxation of the restraint previously entered into by consent.  The applicant conceded that an amount of $5,458 (said to be sought by the respondent) should be released in addition to the sum of $3,199.50 sought by the applicant.  The respondent did not seek a specific sum in his response.  The quantum sought by the applicant was first identified in the minute handed up at the commencement of the hearing.  The evidence did not address why these items ought to be made good from the Company account.  The lack of clarity as to why amounts ought to be paid (the applicant’s evidence did not set out the basis for distinguishing between items legitimately part of the business expenses of the Company and otherwise) means that I am not prepared to make the order sought by the applicant.

7. The respondent’s application for discharge was opposed firstly because it was said that there was no change of circumstances since the making of the consent orders, and secondly because of the circumstances at the time of the making of the consent orders which are as follows:

   a)The respondent initially disputed that the Federal Circuit Court had jurisdiction, a matter that stood in the way of the applicant’s proceedings;

   b)The respondent subsequently conceded jurisdiction, a number of days prior to the hearing of the matter;

   c)At that time the Respondent disclosed the presence of approximately $120,000 in the Company account;

   d)The applicant made a claim for interim property division of $100,000;

   e)By the time the matter came before that Court, that is within 9 days, the respondent had drawn approximately $90,000 from the Company account and paid legal fees, leaving a balance (at that point) of about $30,000.

8. It was said for the respondent that a change of circumstances was not required because the orders were made until further order.  In any event, the order I will make regarding the payment of a lump sum to the applicant constitutes a significant change of circumstances if such a change is in fact required.  Further the respondent argued that:

   a)The “restraint is unnecessary and unduly restrictive;”[25]

   b)The respondent asserted that he was unable to meet Company expenses from the Company accounts.

   c)In periods of unemployment, the respondent is unable to access the Company funds.  This is not correct as the restraint specifically caters for such a circumstance allowing a drawing of funds.

   d)No particular prejudice was identified by the applicant.

   [25] Respondent’s summary of argument.

9. It was proper and necessary for the restraint to be in place pending the resolution of the lump sum and spousal maintenance claims.  These have now been resolved.

10. The restraint has not been established as necessary in respect of the protection of the ultimate claim made by the applicant.  In seeking the payment of the lump sum the applicant asserted that the amount claimed by way of interim distribution ($30,000) forms a mere 0.7 per cent of the pool of assets of the parties.[26]  What remains in the Company account (and what may accumulate in the account due to rents paid in respect of the Suburb B property) is significantly less than even this portion of the pool.  It is not (and could not be) asserted that the disposal of the total amount held within the Company account by either the applicant or the respondent might defeat the ultimate claim of the applicant.  The risk disposal posed was to an interim distribution only.  Given that has now been dealt with, that risk no longer persists.

    [26] Applicant’s summary of argument.

11. Under those circumstances, the restraint is no longer necessary and will be discharged.

12. This leaves the final matter of the proposed restraint upon the respondent in relation to the occupation of the Suburb B house.

13. The impetus for this restraint related to an attempt on the part of the applicant to force the respondent to arrange his accommodation in a manner that would maximise his ability to derive an income.  This was sought in an attempt to support the spousal maintenance claim.  Given my ruling in respect of the capacity of the respondent regardless of the income to be derived by the Company in relation to the Suburb B house, there is no justification for the restraint sought.

14. Without such a justification, the restraints proposed cannot be described as either proper or just and convenient.  I decline to restrain the respondent from occupying the Suburb B house.

I certify that the preceding sixty four (64) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Gill delivered on 20 September 2016.

Associate: 

Date:   20 September 2016