Waller & Niklasson
[2021] FedCFamC2F 248
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)Waller & Niklasson [2021] FedCFamC2F 248
File number(s): DGC 1393 of 2021 Judgment of: JUDGE BURCHARDT Date of judgment: 14 October 2021 Catchwords: FAMILY LAW - property proceedings where husband has become bankrupt on his own petition - wife seeking 80/20 property division and trustee seeking 70/30 - where husband has absconded with chattels and wife is still a guarantor in receipt of Motor Vehicle 1 truck in Husband’s possession - whether the court should order the party with the benefit of the guarantee to substitute the husband for the wife - guaranteed party objecting - likelihood of non-payment of the guarantees loan if substitution made - court declining to order pursuant to s 90AE of the Family Law Ac t- otherwise property divided 75/25 in favour of the wife Legislation: Family Law Act 1975 (Cth) Cases cited: Commissioner of Taxation v Tomaras [2018] HCA 62
Stanford & Stanford [2012] HCA 52
Division: Division 2 Family Law Number of paragraphs: 51 Date of last submission/s: 14 October 2021 Date of hearing: 14 October 2021 Place: Dandenong Solicitor for the Applicant: Ms Tadross Solicitor for the First Respondent: The Respondent did not appear Solicitor for the Second Respondent: Mr Nelson ORDERS
DGC 1393 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS WALLER
Applicant
AND: MR NIKLASSON
First Respondent
SIMON NELSON AS TRUSTEE FOR THE BANKRUPT ESTATE OF MR NIKLASSON
Second Respondent
ORDER MADE BY:
JUDGE BURCHARDT
DATE OF ORDER:
14 OCTOBER 2021
FINAL ORDERS
THE COURT ORDERS THAT:
1.That after the real property situate and known as B Road, Suburb C in the said State of Victoria, being the whole of the land more particularly described in Certificate of Title Volume xxx Folio xxx (‘’the Suburb C property’’) is sold and that upon completion of the sale the proceeds of the sale be applied as follows:
(a)First, to pay all costs and commissions of and incidental to the sale of the property.
(b)Second, to discharge the Mortgage held with Westpac Banking Corporation with registered mortgage number xxxx.
(c)Third, to pay any outstanding Australian Taxation Office debts that Company E and Company F has on an outstanding balance of $90,741.91; and
(d)Fourth, to pay out the personal loan with Westpac in the name of Ms Waller with BSB xxx Account number xxx with outstanding balance of $43,201.02; and
(e)Fifth, to pay out Bank D loan contract number xxxx in the name of Company E, with outstanding balance of $12,059.94; and
(f)Sixth, to pay any outstanding monies owing to Workcover with account number xxxx with outstanding balance of $13,000.00; and
(g)Lastly, the balance to be paid as follows:
(i) 75% to the Applicant.
(ii) 25% to the Second Respondent.
General
2.That without limiting any powers or rights the Second Respondent has under the Bankruptcy Act 1966 with respect to the bankrupt estate of the First Respondent, unless otherwise specified in these Orders and save for the purposes of enforcing any monies due under these or any subsequent Orders:
(a)each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these Orders;
(b)monies standing to the credit of the parties in any bank account are to become the property of the respective holder;
(c)each party forgoes any claim they may have to any superannuation benefits belonging to or earned by the other;
(d)insurance policies shall remain the sole property of the owner named thereon;
(e)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders.
(f)any joint tenancy of the parties in any real or personal property is hereby expressly severed.
3.That if any party refuses to or neglects to execute a Deed or instrument (“the documents”) necessary to give full effect to the terms of these Orders within five (5) days of notice in writing being given by the other party or his/her/its solicitor, then the Registrar of the Dandenong Registry of the Family Court of Australia is hereby appointed pursuant to the Provisions of Section 106A of the Family Law Act 1975 to execute such documents and do all acts and things necessary to give validity and operation to the documents and the defaulting party will pay the requesting party’s costs of enforcing this provision.
4.Orders 3 and 4 of the orders made on 23 June 2021 are discharged.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym Waller & Niklasson has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE BURCHARDT
INTRODUCTORY
This is an unusual property dispute. The husband is bankrupt and the active parties in the proceeding are essentially the wife and the trustee in bankruptcy. There is, however, an ancillary player to whom attention will need to be addressed. The wife seeks that she be released from a guarantee given to Company G (“Company G”) and the husband substituted for her pursuant to section 90AE of the Family Law Act. Although Company G has not appeared in the case, it is apparent that Company G opposes that part of the application.
For the reasons that follow, I propose to make an order that the former matrimonial home be sold, a number of debts (which do not appear to be the subject of major disagreement) be discharged and the remainder divided 75/25 in favour of the wife. In respect to the section 90AE application, it seems clear to me that the authority of the High Court in Commissioner of Taxation v Tomaras [2018] HCA 62 stands as an irrevocable barrier to what the wife seeks and I will not make the order accordingly.
AGREED OR UNCONTESTED FACTS
From the wife’s affidavit material, it is apparent that she was born in 1984 and the husband in 1983. They commenced a relationship in 2008 and cohabited in 2010. Final separation took place in 2020. The two children of the marriage, W, born in 2016, and X, born in 2019, arrived over time.
The marriage was the subject of coercive and controlling violence by the husband as deposed to in the wife’s affidavits. The husband commenced a group known Company H in early 2014. The wife had been working as an allied health worker from 2010. She lent the husband in 2010 to 2011 around about $40,000. In 2012, they rented a factory to further their joint interests. The wife undertook and paid herself for IVF treatment prior to the birth of X. In 2016, the parties, the husband and wife, bought a property in Suburb C for $580,000. The deposit of $130,000 was paid from joint savings. A mortgage of $425,570 completed the balance of the purchase price.
The husband’s business had not gone well and Company H was liquidated in 2019. Thereafter, another company, which I shall simply describe as “Company E” was started. It appears that the wife is a director of that company, although formal corporate documents have not been filed with the Court. In addition, a further company known as Company F was started and that actually owned the plant and equipment with which Company E conducted its work.
The husband was the sole director of Company H, but the husband, as personal guarantor, owed moneys to the Company J, Company K and Company Ltd all of which entities have lodged caveats over the matrimonial property. Company J has obtained judgment against the husband personally in the Court M in 2019 and the amount still owed is over half a million dollars. The wife has asserted that Company K is owed about $60,000 and Company L about $30,000.
Following separation in 2020, the husband, amongst other things, has removed a Motor vehicle 1 and a Motor vehicle 2 owned by COMPANY F (the Motor Vehicle 1 is owned by COMPANY E). The wife is a guarantor in respect of the purchase of the Motor Vehicle 1 truck with funds from Company G and there is approximately $81,000 secured by that guarantee.
The husband has been asserted by the wife to have assets in his possession other than the Motor Vehicle 1 Truck to the value of $80,000. He has, to all effects, absconded and his whereabouts are unascertainable. He went bankrupt, it would seem, of his own petition on 27 March 2021. An intervention order was taken out against the husband by the wife on 30 April 2021. The matter commenced in this Court in April 2021 as between the parties themselves because the wife did not know that the husband was bankrupt. On 23 June 2021, the matter came before the Court and neither the trustee or the husband appearing, I made a number of orders. So far as parenting matters were concerned, I granted the mother sole parental responsibility and, effectively, reserved the father’s time. In respect of property, I made a number of orders designed to sell the B Street, Suburb C property and discharge the mortgage with the remainder of funds to be held on trust. I also made orders pursuant to section 90AE to substitute the husband as the guarantor and for the wife to deregister the Motor Vehicle 1.
There is correspondence passing between the solicitor for the wife and Company G and its solicitors which I will deal with when I come to the section 90AE application.
THE SUBMISSIONS MADE AT COURT
Both the solicitor for the applicant and the trustee, Mr Nelson, indicated that they were content for the matter to proceed before the Court by way of oral submissions.
Ms Tadross pointed to the fact that the orders made on 23 June 2021 had no timeframe for the substitution in respect of the guarantee and she took the Court through the correspondence. She traversed the issue of the relationship and the various debts that had accrued. It is apparent that the debts to the Australian Taxation Office are debts of COMPANY E and COMPANY F for which the wife, it was asserted, is nonetheless responsible. The mortgage is in joint names. The wife’s personal loan reflected debts consolidated during the relationship. The WorkCover debt is in relation to COMPANY E and the Macquarie car debt is $12,000. The debts additional to the mortgage amount to some $159,000. The wife seeks 80 per cent of the net proceeds of the sale because she has full-time care of the children and is not receiving any child support. The property is listed for sale with an estimate of somewhere between $1.095 million and $1.2 million.
Mr Nelson agreed with the $1.2 million, but pointed out that, after payment of all the debts, there would be $562,000 left.
The three creditors (ie the caveators) are owed over $500,000.
Ms Tadross confirmed that the three caveats have been removed. The wife cannot work. The WorkCover debt is that of COMPANY E and the wife is a director. She sought the substitution of the guarantor pursuant to section 90AE of the Act. The Motor Vehicle 1 has a debt of $80,000. It is in the husband’s possession and cannot be found. There is an unsecured truck which was surrendered to Company G. COMPANY E bought the Motor Vehicle 1. The wife wants to surrender it or sell it but cannot find it. She wants the husband to substitute as guarantor. The remaining debt is about $80,000.
Mr Nelson submitted that a figure of 30 per cent was more common in his albeit limited experience in proceedings of this sort where one party is bankrupt. He noted that the division proposed by the wife was only after the debts had been included. He queried whether all of these were actually enforceable against the wife. He queried whether the wife was liable for the COMPANY E debts. He submitted the secured creditors might have contributed to the purchase of the property. He informed the Court that the creditors who had lodged caveats were aware of the hearing and did not seek to be heard. He referred to the difficulty as between the chargees as to priority.
In further submission, Ms Tadross alerted the Court to the Company J judgment in the County Court. The land was purchased with savings of $130,000. The wife has been paying the mortgage since separation.
STANFORD & STANFORD
Notwithstanding the unusual circumstances of the case, it is still, in my opinion, appropriate to commence with the task identified by the High Court in Stanford & Stanford [2012] HCA 52, namely, to ascertain the legal and equitable interests of the parties and determine whether a property adjustment is appropriate. In circumstances where the husband has left and gone bankrupt, leaving the wife, taking some of the valuable hard assets of the marriage and the wife is left with all the debt, it is plainly appropriate that there should be a property adjustment.
THE POOL
The pool consists in terms of positive assets essentially of:
(a)the property to be sold (about which, in itself, there is no material disagreement). This will produce a sum of somewhere between 1.1 and 1.2 million dollars.
(b)items in the husband’s possession, but not presently realisable:
(i)Motor Vehicle 1, $80,000;
(ii)Line pump, $55,000;
(iii)Bobcat, $15,000;
(iv)Tools, $10,000.
Additionally, the wife has superannuation of about $22,000.
The liabilities of the relationship are multiple. They include:
(a) Mortgage, $425,570;
(b) Westpac personal loan (wife), $48,000;
(c) ATO liabilities of the companies, $120,000;
(d) N Bank, $55,000;
(e) Company G, $80,000;
(f) Bank D (Motor vehicle 3), $25,000;
(g) WorkCover, $13,000.
I note that, in relation to the N Bank debt, the wife proposes to surrender the O boom pump for $20,000 and the Case mini-excavator for $15,000 to reduce the debt to them.
It should be noted that, although some of his debts are arguably not debts of the wife personally, the trustee did not, as I understand the matter, take any issue with the fact that these debts should all be paid out. It is, however, in my opinion, a relevant consideration in determining the percentages that should be paid out.
THE ISSUE OF CONTRIBUTIONS
This was a relationship of over 10 years in which the parties had nothing of any moment at the commencement. The wife’s unchallenged evidence is that she worked productively until her children were born. The husband worked, albeit it would seem with negative financial effect, but in circumstances where the parties to the marriage take the good with the bad and there is nothing to suggest that the husband’s conduct of his business affairs was wanton or reckless, I will, in the circumstances, hold the parties’ contributions to be equal.
THE FUTURE NEEDS MATTERS – SECTION 75(2)
The wife will have the sole care and responsibility for bringing up two very young children for a long time. Her capacity to work will necessarily be affected by these responsibilities. The wife is in good health and I have no details or information about that of the husband. I note that the wife says he has mental health issues and suffers drug dependency, but there is nothing to show me that this is affecting his capacity to work. In my view, a loading of 25 per cent in the wife’s favour would be a fair and reasonable assessment.
JUST & EQUITABLE
On the one hand, the wife is getting rid of a number of debts which, on one view of the matter, she might not be required to pay. That appears to be the case particularly in relation to the taxation debt of COMPANY F, of which I do not understand her to have been a director. It may be that she has justifiable concerns about being sued as a director in relation to insolvent trading by COMPANY E, but, on any view of the matter, it is desirable that she be given as clean a slate as possible with which to engage in her future life and, most particularly, to the benefit of the two young children. Furthermore, for reasons to which I will shall shortly come, she will also continue to have responsibility for the $80,000 owed to Company G in circumstances where the single asset most likely to reduce her liability has been, in effect, stolen by the husband. It is a very unfair outcome. As between the husband and wife, the trustee now standing in the husband’s shoes, I think that 75/25 division in the form thus indicated is, indeed, just and equitable.
THE APPLICATION IN RELATION TO THE GUARANTEE
I do not now recall in any detail at all what, if anything, was said to support the orders directing the removal of the guarantee in June of 2021. Either I was satisfied by oral submissions made that Company G had had proper notice of the matter or I simply in error overlooked the matter. One thing I certainly did not turn my mind to in any detail were the various qualifications to the Court’s powers contained in section 90AE of the Act.
This brings us to the correspondence to which I have referred. On 6 July 2021, Ms Tadross wrote to Company G confirming the orders I made on 23 June 2021. She referred to the orders to substitute the husband as the guarantor and for Company G to do such things as were necessary to enable that to occur. She referred to the bankruptcy of the husband on 27 March 2021 and the fact that the husband remained in possession of the Motor Vehicle 1 and that Company G continued to have a security interest over the VIN number.
On 16 July 2021, Messrs D. Riggio & Associates, Solicitors, responded. They drew attention to the terms of section 90AE(3) and 90AE(4). They stated relevantly:
We are of the view that the Judge who made the orders did not consider the fact that the party to be substituted guarantor is in fact bankrupt and therefore it is highly likely that the debt owing to our client will not be paid. Clearly this is contrary to section 90AE(3)(b).
Furthermore, our client has not been afforded procedural fairness. The orders made are unconscionable and contrary to what is envisaged by the section. In the case of the Commissioner for Taxation v Tomaras, the High Court considered whether the Family Court could substitute the husband to be solely liable for ATO’s debt of the wife. In that case, the husband was bankrupt and it was found that it was difficult how section 90AE(3) could be satisfied due to the fact that the husband was bankrupt and it was likely that the debt would never be paid.
You failed to properly inform the Court of the true facts and circumstances of the matter and misled the trial judge.
In making the orders, Judge Burchardt failed to take into account that Mr Niklasson did not have the capacity to pay the debt owing to our client as he was bankrupt and, therefore, should never have exercised his discretion to grant the orders.
Finally, for the reasons set out above, our client still holds your client liable for the debt pursuant to the terms of the guarantee she signed in 2019. We note that our client has been unable to repossess the Motor Vehicle 1 utility. We request that you advise us as a matter of urgency as to its location so that our client can take appropriate action to repossess the vehicle.
We request that you urgently approach the Court to seek to have the orders made.
They went on to assert that, were this not done, they would make an application and seek indemnity costs.
On 23 July 2021, Ms Tadross replied. She averred that:
In a phone call with Ms P of Company G on 8 June 2021, I informed her of my intentions about seeking Family Law orders that Mr Niklasson be substituted as guarantor on loan contract number … instead of my client. The response that I received from Ms P was that she had not heard of that before, and I reassured her that there was a section pursuant to the Family Law Act 1975 (the Act) that provided for such an order to be made. Ms P had agreed to not default in my client’s name until at least after the Court orders were made and to date, I do not believe that a default has been listed on my client’s credit file.
In your letter you refer to section 90AE(4)(e) of the Act and how it includes the capacity of a party to the marriage to repay the debt after the order is made.
On what basis do you form your view that Judge Burchardt did not consider the fact that the party being substituted as a guarantor was in fact, bankrupt, and in your opinion unlikely that the debt owing to your client will not be paid. Your client was provided with procedural fairness by way of my conversation with Ms P on 8 June 2021.
Otherwise, the letter does not materially take matters further, save that it was asserted on the second page:
Your authority does not seem to consider the fact that probably one of the reasons why Judge Burchardt granted the order was because Mr Niklasson is in possession of the Motor Vehicle 1 utility and due to circumstances beyond my client’s control and based on sworn affidavit material did so grant the order for the guarantor to be substituted. If your client is able to repossess the Motor Vehicle 1, then the remaining debt would be greatly reduced.
A further reply from D. Riggio & Associates was sent on 30 July 201. They noted that Ms P had not had Ms Tadross’ position confirmed in writing and continued to assert that procedural fairness had not been provided. The letter requested copies of all affidavits relied upon at the hearing and the submissions and said:
In this way, we will be in a better position to assess our client’s position with respect to the orders made and provide our client with appropriate further advice.
We are of the view that, given that the Orders were made under section 90AE the Court did not properly consider the fact that Mr Niklasson is bankrupt, he has absconded, did not appear at the hearing and is in the possession of the Motor Vehicle 1 which our client cannot repossess because it cannot be found.
Even if our client is successful in repossessing the Motor Vehicle 1 it is difficult to know its condition and the sale price it would fetch at auction. As such, your comment that, if our client can repossess it, the remaining balance would be greatly reduced is mere speculation.
The letter went on relevantly to reserve their position.
At the hearing before me, Ms Tadross informed me she had not complied with the request for affidavit material because she felt it included confidential matters relating to the marriage. On any view of the matter, no reply has been sent.
I have given thought as to whether or not I should adjourn this matter and possibly join Company G, who have made it clear that their position is still one of opposition and that they would desire to be heard. For the reasons to which I now come, however, I do not propose to do this.
Section 90AE provides:
(1)In proceedings under section 79, the Court may make any of the following orders:
(a)an order directed to a creditor of the parties to the marriage to substitute one party for both parties in relation to the debt owed to the creditor;
(b)an order directed to a creditor of one party to a marriage to substitute the other party, or both parties, to the marriage for that party in relation to the debt owed to the creditor;
(c)an order directed to a creditor of the parties to the marriage that the parties be liable for a different proportion of the debt owed to the creditor, then the proportion that the parties are liable to before the order is made;
(d)an order directed to a director of a company or to a company to register a transfer of shares from one party of the marriage to the other party.
(2)In proceedings under section 79, the Court may make any other order that:
(a)directs a third party to do a thing in relation to the property of the party to the marriage; or
(b)alters the rights, liabilities or property interests of a third party in relation to the marriage.
(3).The Court may only make an order under subsection (1) or (2) if:
(a)the making of the order is reasonably necessary, or reasonably appropriate and adapted, to effect a division of property between the parties to the marriage; and,
(b)if the order concerns a debt of a party to the marriage – it is not foreseeable at the time the time is made that to make the order would result in the debt not being paid in full; and
(c)the third party has been accorded procedural fairness in relation to the making of the order; and
(d)the Court is satisfied that, in all the circumstances, it is just and equitable to make the order; and
(e)the Court is satisfied that the order takes into account the matters mentioned in subsection (4).
The relevant matters in subsection 4 are:
(e) If the order concerns a debt of a party to the marriage – the capacity of a party of the marriage to repay the debt after the order is made.
(g) If, as a result of the third party being accorded procedural fairness in relation to the making of the order, the third party raises any other matters – those matters.
From this it is clear that, at least subject to the provisos in subsection (3) and (4), the Court has power to make the sort of orders that the applicant wife seeks pursuant to section 90AE(1) or (2). However, this brings us squarely to the decision of Commissioner of Taxation v Tomaras [2018] HCA 62.
That case turned on a slightly different set of circumstances, but parts of it are directly on point. In the joint judgment of Kiefel CJ and Keane J at [4], their Honours said:
Within part VIII of the Act, a court considering the exercise of its jurisdiction in property settlement proceedings under s 79 must, by reason of s 75(2)(ha), take into account the effect of any proposed order on the ability of a creditor of a party to the marriage to recover the creditor’s debt.
At [4], their Honours continued relevantly:
Within Part VIIIAA, s 90AE(1)(b) provides that in proceedings under s 79, the Court may make "an order directed to a creditor of one party to a marriage to substitute the other party ... to the marriage for that party in relation to the debt owed to the creditor". Part VIIIAA is thus explicitly ancillary to section 79 of the Act.
At [6], their Honours set out subsections 90AE(3)(a), (b) and (d).
At [9], their Honours went onto say:
Given that, so far as appears from the record in the present case, the husband is a bankrupt and the wife is solvent, it is not possible to see how the condition in section 90AE(3)(b) could be satisfied in this case. More generally, it is difficult to see how any case where there is real prospect of the substitution of one spouse for another as the debtor of the revenue authority would create or enhance a risk of non-payment would not fall foul of s 90AE(3)(b) of the Act.
In the separate decision of Gageler J, his Honour came to the same conclusion as to the disposition of the appeal, but his Honour’s decision is not directly relevant in this case.
In a separate decision by Gordon J, her Honour observed at [29]:
Part VIII of the Family Law Act 1975 (Cth) provides for spousal maintenance and the division of the property of the parties to a marriage. In proceedings with respect to the property of the parties to a marriage, s 79, in Part VIII provides that a court may make such order as it considers appropriate altering the interests of the parties to the marriage in the property, but that the court shall not make such an order unless it is satisfied that in all the circumstances it is just and equitable to make the order. In considering what order (if any) should be made, the court must take into account prescribed matters. One matter the court must consider is the effect of any proposed order on the ability of a creditor of a party to the marriage to recover the creditor's debt, so far as that effect is relevant.
Her Honour went onto say at [71] – [72]:
Section 90AE was intended to cover, and covers, a range of possible arrangements that a party to the marriage may have which involve a third party, including ownership of life insurance products, shares in corporate entities and the creditors of the parties to a marriage whether they are family, friends or financial institutions. The range of available orders was intended to be broad and included substitution of the party liable for a debt, adjusting the proportion of a debt that each party is liable for or ordering the transfer of shares between the parties to the marriage.
However, the circumstances in which the orders may be made against a third party are confined. Relevantly for the purposes of this appeal, the court may only make an order concerning a debt of a party to a marriage which binds a third party if "it is not foreseeable at the time that the order is made that to make the order would result in the debt not being paid in full.” As will become apparent, this provision is important in applying section 90AE to a debt owed to the Commonwealth which arises under a taxation law.
At [87], her Honour went on to say:
The fact that the husband in this appeal was bankrupt is reason enough not to make the order sought by the wife under section 90AE.
In a further separate judgment, Edelman J at [127] set out the terms of section 90AE(3) and went onto say at [128]:
The effect of s 90AE(3)(b) is that the Crown will only be subject to the substitution of a person as its debtor where it is not foreseeable that the substitution would cause the debt not to be paid in full.
Here, and leaving aside any questions of procedural fairness, the husband is bankrupt. At the moment Company G has the benefit of a guarantee entered into by the wife in 2019. If the guarantee is transferred to the husband, it is instantly obvious, given his bankruptcy, that there is a risk that the debt will not be repaid in full. First, the asset that the guarantee referred to is in the possession of the husband and he cannot be found. Even if he could be found, it seems highly probable that the debt may not be fully removed by the sale of the vehicle given that there is nothing known about its condition in the circumstances. It is, I regret to say, all too obvious that it is readily foreseeable that the removal of the guarantee will ensure that the debt is not repaid in full.
Clearly, I was not directed to these matters in any detail when the matter was before the Court previously. I should not have made the orders that I did make for this reason, even if procedural fairness was found to have been given to Company G, and is not necessary for me to express a concluded view about it given my overarching view of the matter.
It is impossible to avoid very considerable sympathy for the wife in these circumstances. She is saddled with a debt purely by the malevolence of the husband. Nonetheless, and even if under some measure of coercion which I think she asserts, the wife participated in the establishment of the guarantee. The guarantee was part of the process whereby the purchase funds for the truck were advanced and separation did not take place until February of the following year. On any view of the matter, it could not be said that the wife received nothing for the guarantee.
This matter is not really directly relevant to the matters under section 90AE, but I would hope that Company G would consider the terms of this judgment. It is certainly a manifest overarching unfairness that the wife should be saddled with the debt by the theft of the husband.
To repeat, however, it is not possible to find that it is not foreseeable at the time that this order would be made that, to make the order would result in the debt not being paid in full. To the contrary, it is all too likely that is the case. The wife cannot succeed in overcoming this qualification in the legislation and, accordingly, I decline to make the orders that she seeks in this regard and will rescind the orders earlier made in error.
I certify that the preceding (51) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Burchardt. Associate:
Dated: 14 October 2021
0
2
0