Walls and Malone

[2017] FamCA 563

FAMILY COURT OF AUSTRALIA

WALLS & MALONE [2017] FamCA 563

FAMILY LAW – PROPERTY – Interim – Orders for the sale of property where the parties’ are in substantial agreeance – Orders for the wife to retain assets of the parties’ former business

Family Law Act 1975 (Cth) s 106A

APPLICANT: Ms Walls

RESPONDENT: Mr Malone

FILE NUMBER: ADC 860 of 2015

DATE DELIVERED: 4 August 2017

PLACE DELIVERED: Adelaide

PLACE HEARD: Adelaide

JUDGMENT OF: Berman J

HEARING DATE: 24 July 2017

REPRESENTATION

COUNSEL FOR THE APPLICANT: Litigant In Person

SOLICITOR FOR THE APPLICANT:

COUNSEL FOR THE RESPONDENT: Mr Heinrich

SOLICITOR FOR THE RESPONDENT: Stokes Legal

Orders

1. That further consideration of paragraph 6 of the Amended Application in a Case filed 17 July 2017 and paragraph 21 of the Application in a Case filed 6 February 2017 is listed for hearing on 11 August 2017 at 2.15pm.

2. That within forty eight (48) hours the parties do all things necessary and sign all such documents as may be required to enter into a contract for the sale of the property at B Street, C Town in the State of South Australia (“the B Street property”) to Mr D or his nominee (if applicable) for the price of SIXTY THOUSAND DOLLARS ($60,000).

3. That within forty eight (48) hours the parties do all things as may reasonably be necessary (including signing all such documents as may be required) to lower the advertised sale price of the property at E Street, Suburb F in the State of South Australia (“the E Street property”) to EIGHTY THOUSAND DOLLARS ($80,000) and shall promptly sign all such documents (including a new Sales Agency Agreement or an extension of the current Sales Agency Agreement) as may be required to sell the property at E Street, Suburb F in the State of South Australia for EIGHTY THOUSAND DOLLARS ($80,000) to a willing purchaser.

4. That G Lawyers be appointed the joint conveyancer of the parties in relation to the sale of the B Street and E Street properties and that each of the parties promptly sign all such documents that are reasonably requested by the conveyancer to sign in relation to the sale and transfers of the properties.

5. That the proceeds of the sale of the B Street and E Street properties be retained in the Trust Account of G Lawyers pending agreement between the parties in writing or further order of this Court.

6. That at the sole cost of the wife, the husband shall make available and deliver up to her the 17 shipping containers presently located at the B Street property NOTING the wife’s intention to retain the containers and her acknowledgement that she does so at a price not less than TWO THOUSAND DOLLARS ($2,000) for each regular container and THREE THOUSAND DOLLARS ($3,000) for each high cube container on the following terms:-

   (a)That the wife shall be restrained and an injunction granted restraining her from selling, transferring, encumbering or in any way disposing of the said shipping containers;

   (b)That the wife shall indemnify the husband and keep him indemnified in relation to any claim by a third party in respect of property currently stored in the containers;

   (c)That the wife will forthwith upon the collection of the said containers advise any third party owner that their property is now no longer situate at the B Street property and shall inform the third party of the current location of their property;

   (d)That the shipping containers shall remain at all times on the property of Mr H situated at J Street, K Town.

   (e)That if the containers are not removed by the wife from the B Street property within ten (10) days of the date of this order THEN the husband shall be entitled to sell the said containers for not less than the price as set out in paragraph 6 with the net proceeds to be held in the trust account of the husband’s solicitors.

7. That within seven (7) days the wife must state in writing to the husband’s solicitors details of all the parties’ jointly owned shipping containers in her possession, custody or control including:-

   (a)The location of the shipping containers NOTING that a dispute exists between the parties wherein the wife contends that she has 23 containers in her possession, but the husband alleges that she has 31 containers;

   (b)The serial number or other identification code of each container.

8. That within seven (7) days (or such further time as Mr L may require) of receipt of the wife’s list of containers by the husband’s solicitors, the wife shall allow Mr L to inspect and photograph all containers in the wife’s possession, custody or control (including all containers located at K Town) and shall allow Mr L access to any location where any of the containers are located for that purpose including at J Street, K Town.

9. That the wife will forthwith pay the tax invoice issued by M Locksmith invoice number Inv…26 in the sum of ONE HUNDRED AND EIGHT SIX DOLLARS ($186) from funds held in the parties’ joint bank account.

10. That the wife will provide to Mr N of O Accountants (“the accountants”) the password to the parties’ business computer, MYOB and all other relevant computer programmes as may be required in order for Mr N to complete the parties’ outstanding taxation and BAS.

11. If either party shall refuse or neglect to execute any document necessary to give effect to these orders within seven (7) days after the same shall have been tendered to him or her for that purpose THEN in such case a Registrar of the Family Court of Australia upon proof by affidavit of such refusal or neglect is hereby appointed to execute any such document on behalf of the parties and if in his or her opinion it shall be necessary to do so to settle the same and to do all such other acts and things and execute all such other documents as may be necessary to give full force and effect to these orders and shall execute the same accordingly.

12. That time for the production of documents as referred to in the Notice to Produce filed 26 May 2017 is extended to 11 August 2017.

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 Walls & Malone 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 ADELAIDE

FILE NUMBER: ADC 860  of 2015

Ms Walls

Applicant

And

Mr Malone

Respondent

REASONS FOR JUDGMENT

INTRODUCTION

1. By Initiating Application filed 3 August 2015 Ms Walls (“the wife”) seeks orders for property settlement.

2. Subject to the repayment of a debt of $20,000 allegedly owed to the son of the parties, the wife seeks to apportion the net property of the parties on a 60/40 per cent basis.

3. By Response filed 14 December 2015 Mr Malone (“the husband”) seeks orders that he receive 60 per cent of the net property of the parties.

4. The current proceedings are in relation to the Application in a Case filed 6 February 2017, the Amended Application in a Case filed 17 July 2017 and the wife’s Response filed 21 March 2017.

5. The proceedings came before me on 6 July 2017 and orders were made that in preparation for the hearing today the husband was to file any further Application in a Case and Affidavit and the wife was to comply with the production of documents pursuant to a Notice to Produce filed 26 May 2017.

BACKGROUND

1. The husband was born in 1954 and is 63 years of age.  The wife was born in 1963 and is 54 years of age.

2. The parties met in 1980 and married in 1984.

3. There are four adult children of the relationship.  The parties separated in June 2014 and a Divorce Order was made on 2 June 2015.

4. The parties relocated to C Town in about 1992 and purchased a business.

5. Both parties worked in the business with the wife undertaking the administration and office duties and the husband being responsible primarily for the day to day operation of the business.

6. The parties business utilised shipping containers.  The business ran under the business names of P Pty Ltd and Q Pty Ltd.

7. Following separation the husband is keen to wind up the business, sell the assets that neither party wishes to retain and pay out the liabilities.

8. The wife has re-partnered.  She retains shipping containers situated on a property leased by her partner.  It appears that she and her partner may be utilising the containers retained by her as part of an ongoing business.

9. Whilst the wife is prepared to concede that she retains 23 shipping containers, the husband contends that the total number retained by her should be 31 containers.  Accordingly, the parties are in dispute over the whereabouts of 8 containers.

10. The husband currently retains 17 containers on his property situate at B Street, C Town (“the B Street property”).

11. He seeks to sell the containers for $2,000 plus GST for each regular container and $3,000 plus GST for each high cube container.  There does not appear to be disagreement between the parties as to the appropriate value of the containers, but the wife seeks to retain the containers in the husband’s possession rather than have them sold.

12. There does not appear to be any issue that would prevent the containers being retained by the wife other than the husband’s application for partial settlement of property which he considers might be compromised unless the 17 containers are able to be sold.

13. Whilst it is not yet admitted by the wife, the husband asserts that the wife has retained the bulk of the valuable property and that even on her case as presented, 40 per cent would see the husband retaining a significant cash amount.

14. The containers currently located on the B Street property have the further complication that up to 7 of them currently store third party property.  Before the containers could be sold the stored property would need to be either returned to the third party or appropriate notice given to them that unless claimed the property may be disposed of pursuant to the appropriate legislation.

15. The wife opposes the sale of the containers and seeks that they be transferred to her.

RELEVANT ORDERS

1. On 10 November 2015, orders were made that the parties place real property on the market for sale as may be agreed between the parties, that the husband deliver up to the office of the parties’ accountant the business computer and all accounting and financial software, all files and a green folder which contains a hard copy of who is renting each container, to enable the accountant to prepare the parties taxation, BAS and invoicing in respect of the business.

2. Funds held in the trust account of G Lawyers were to be directed towards the discharge of matrimonial debts and any debt owing on behalf of the business or the parties to the Australian Taxation Office (“ATO”).  Orders were made that each party provide mutual informal discovery within 42 days.

3. On 5 February 2016 orders were made that restrained each of the parties from withdrawing any funds from the relevant banking accounts save and except that in respect of the wife, she was able to access the accounts for expenses and outgoings in the ordinary course of business.

4. Time was extended for the parties to provide mutual informal discovery to 18 March 2016.

5. On 29 April 2016 extensive orders were made by consent transferring the husband’s interest in properties at 1 and 2 R Street, Suburb F to the wife.  Contemporaneously with the transfer of the said properties, the wife was to discharge liabilities secured over the properties, but in particular the ANZ overdraft account, home loan and the legal costs in relation to the transfer.

THE INTERIM PROCEEDINGS

1. As matters have transpired, there is very little disagreement between the parties in respect of the interim orders sought in the Application filed 6 February 2017 and the Amended Application of 17 July 2017.

2. In respect of the latter application, there was no opposition to paragraphs 2, 3, 4, 5, 8, 9, 10 and 12 of the amended application.  Agreement was not reached in respect of paragraph 6 of the application which seeks that the proceeds of the sale of the B Street property and the property at E Street, Suburb F (“the E Street property”) be paid to the husband by way of partial settlement of property.

3. After discussion, agreement was reached that the 17 remaining shipping containers located on the B Street property could be collected by the wife provided that they not be disposed of and not be removed from the property rented by her partner at J Street, K Town.  There is also agreement that the containers that are or will be in the possession of the wife will be the subject of inspection, identification and valuation.

4. The wife agrees to an order in terms of paragraph 10 enabling the payment of an invoice issued by M Locksmith.

5. Paragraph 11 seeks an order requiring the wife to process payment of all liabilities of S Pty Ltd to the ATO from the parties’ joint accounts with the ANZ Bank and Commonwealth Bank of Australia.

6. The wife tendered a document which was a transcript of a conversation between the wife and an ATO Officer.  The transcript suggests that the amount outstanding was $7,910.07 as opposed to an amount of $17,497.32 as represented on a notice issued by the ATO dated 21 June 2017.  Following the conversation with the ATO, the wife paid the outstanding amount and contends that as at the present date nothing further is outstanding.

7. The husband was unaware of the discussion with the ATO and that the wife had paid a significant sum.

8. As matters presently stand, I do not propose to make orders in terms of paragraph 11 of the husband’s application.

9. The wife agrees that a general order can be made pursuant to s 106A of the Family Law Act 1975 (Cth) (“the Act”) to enable a Registrar to execute documents as may be necessary to give effect to orders made upon proof by affidavit of a refusal by a party to do so.

10. Paragraphs 14, 15 and 16 of the husband’s Application in a Case filed 6 February 2017 relate to orders that would enable the parties’ accountant to complete their outstanding taxation and BAS.

11. The difficulty has apparently been the provision by the wife of the computer password.  In submissions, the wife argued that the password had been provided to the accountant, but that in any event it was “6363”.  Accordingly, an order can be made in terms of paragraph 15 of the application.

12. Paragraphs 17 and 18 of the application relates to the parties complying with the obligations pursuant to the Warehouse Liens and Storage Act 1990 (SA) which requires formal notice to be given to third parties who have stored property with the business that unless collected may well be disposed of.

13. The husband agreed that the wife will take possession of the shipping containers on the B Street property and she will indemnify the husband in respect of any liability arising from any third party claim.

14. The husband seeks an order by way of partial property settlement that he retain the funds currently held in the Stokes Legal Trust Account, the surrender value of the Colonial Umbrella Policy and AMP Life Insurance and the proceeds of sale of B Street and E Street properties.

15. The parties agree that they now seek orders that are likely to be different to those expressed in the initiating application and the response.

16. The husband has filed a recent affidavit which sets out the value of property retained by the wife, the husband including property and money not yet distributed to the parties.

17. The wife’s position in respect of the husband’s application is uncertain.  If the husband’s estimate of the property retained by him is a total of $20,200 (including three high cube shipping containers worth $10,800), then it is likely that the husband may have some entitlement to an interim distribution.

18. I have adjourned further consideration of the husband’s application seeking an order of partial settlement of property to 11 August 2017.

19. I make orders as appear at the commencement of these reasons.

I certify that the preceding forty four (44) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Berman delivered on 4 August 2017.

Associate: 

Date:  4 August 2017