WALMSLEY & WALMSLEY

[2010] FamCA 355

FAMILY COURT OF AUSTRALIA

WALMSLEY & WALMSLEY [2010] FamCA 355

FAMILY LAW – PROCEDURE – Interim orders

Family Law Act 1975 (Cth)

APPLICANT: Mr Walmsley

RESPONDENT: Ms Walmsley

INDEPENDENT CHILDREN’S LAWYER: Robert Winter

FILE NUMBER: ADC 728 of 2008

DATE DELIVERED: 25 January 2010

PLACE DELIVERED: Adelaide

PLACE HEARD: Adelaide

JUDGMENT OF: Strickland J

HEARING DATE: 25 January 2010

REPRESENTATION

THE APPLICANT: In person

THE RESPONDENT: In person

COUNSEL FOR THE INDEPENDENT CHILDREN’S LAWYER: Mr Winter

SOLICITOR FOR THE INDEPENDENT CHILDREN’S LAWYER: Robert Winter - LSC

Orders

1. That the Response to an Application in a Case filed by the husband on 19 November 2009 be dismissed and removed from the active pending cases list.

2. That paragraphs 1 and 2 under the heading Financial Issues in the Application in a Case filed by the husband on 9 October 2009 be dismissed and removed from the active pending cases list.

3. That further consideration of paragraph 10 of the Response to an Application in a Case filed by the wife on 2 November 2009 be adjourned to 9:15am on 1 March 2010.

4. That further consideration of this case generally be adjourned to 9:15am on 1 March 2010 before Justice Dawe.

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

FAMILY COURT OF AUSTRALIA AT ADELAIDE

FILE NUMBER:  ADC 728 of 2008

MR WALMSLEY

Applicant

And

MS WALMSLEY

Respondent

EX TEMPORE REASONS

1. I have before me an application by the husband contained in a response that he filed on 19 November 2009.  The application he makes is that the wife pay to him $12,500 by way of partial property settlement.  That application is opposed by the wife. 

2. This is a long running case and it was hoped that a conclusion hearing would take place soon.  Indeed, the initial discussion was that it might take place in February or March of this year.  That has now proven to be impossible and the current indications are that the earliest it could be heard will be April or May.  One of the prime reasons for that is the failure by the parties to prepare and file admissible affidavits in their respective cases.  At the moment the wife is redoing her affidavits and she tells me there is another four to five weeks before that exercise will be completed.  If that is correct, that in itself might have a further impact upon the listing of this matter for a conclusion hearing in April or May.  Separate to that, another delay that has arisen is in relation to discovery.  The husband has been dilatory in providing complete discovery and it is only now that apparently the documents are available at his former solicitor’s office.  Where that leads is unclear, in that the wife has to inspect them, see if they are all there and if they are not, obviously there may be issues of further and better discovery.

3. The issues in the case comprise both children’s issues and property settlement.  The children’s issues are difficult and complicated and that in itself has led to a number of interlocutory applications being made by both parties.  It has also reached the point where neither party is represented, and the husband has significant unpaid accounts from his lawyers and, as I understand it the wife also still has about $16,000 to pay to her former lawyers.  Indeed, as I read the husband’s application that is before me today, the primary catalyst to him bringing this application is the need to pay outstanding counsel fees.

4. There is another issue which has arisen in that Legal Services Commission have required the parties to pay almost $4000 each into the Commission’s trust account to cover the costs of witnesses that the Independent Children’s Lawyer will need to call in relation to the children’s issues.  That is another financial pressure on both parties, but the husband has told me today that if he is successful in his application today, he would propose to use some of the money that he would receive in meeting that commitment.

5. The husband’s financial circumstances are set out in his financial statement filed on 13 May 2009.  It has not been updated, but I do not understand that his financial circumstances have improved at all.  At that time his expenses were slightly less than his weekly income.  In terms of the property owned by him, that was primarily tied up with his interest in certain real estate.  Indeed, there are two items of real estate which are in joint names, one valued at $150,000 and another valued at $25,000.  The former is subject to a mortgage.  Apart from that real estate, the husband at that time had a motor vehicle with an agreed value of $9500, he said he had no bank accounts and he had a number of loans in addition to the mortgage secured over the jointly owned property.

6. Although the husband is looking for funds to pay his lawyers, he has framed his application as a partial property settlement application, as opposed to seeking an order by way of either security for costs or by way of costs.  There are different principles that apply, depending upon whether it is a partial property settlement application or an application for costs.

7. The husband has filed an affidavit in support of this application and it was filed on 16 December 2009.  However, that affidavit is less than helpful.  It simply says that he has these outstanding fees to pay, and he identifies the property at N, which is in the joint names of himself and the wife, as being a source of funds to meet his claim.  Indeed, he has tied his claim to what he says is his 50% share in that property, that property being valued or having an agreed value of $25,000.

8. To repeat, the husband appears in person.  He has not been able to refer me to any of the authorities in relation to partial property settlements and unfortunately he has not been much assistance to me at all in support of his application.  I suspect he has no appreciation or understanding of the relevant principles that apply and that is a problem in how I determine this application.

9. From the wife’s point of view, as I say, she opposes the application.  Her financial position is set out in a financial statement filed on 21 April 2009.  She tells me that her financial position has not changed dramatically since then and looking at that financial statement her assets comprise primarily her interest in various items of real estate, some in her sole name, two properties though in the joint names of the parties and that I have referred to already, namely, a property at H and property at N. Outside of that she has a couple of bank accounts, but the credit balance is minimal.  She also has a motor vehicle.  Thus there is no fund of money that the husband is able to identify from which this sum of $12,500 can be paid.  He does say that if the wife cannot pay him $12,500, which is indeed obvious from her financial statement, then that property at N should be sold and he receive one half of the proceeds.  The difficulty with that is that the wife seeks, in the orders that she seeks from her property settlement, that she retain that property at N, and that the husband’s interest be transferred to her.  It is part of a portfolio of real estate which was purchased by way of investment, not only for the parties’ future, but for their children’s future.  Thus the wife wishes to retain that property as part of her property settlement entitlement. 

10. In terms of the respective applications that the parties make by way of property settlement, the husband seeks by way of final order, in effect, a payment to him by the wife of 50% of the net value of the assets.  The husband tells me that if he is successful in that application, he would be entitled to about $200,000.  He does not want to retain any of the items of property.  He is perfectly comfortable to transfer his interest in the jointly owned property to the wife if she wishes to retain it.

11. From the wife’s point of view, she says the husband is only entitled to 3% of the net asset pool, and on her calculations that is about $19,800.  However, separate to that there are a number of matters that the wife, in her final orders application seeks to be taken into account which would reduce that $19,800 down to nil.  They primarily relate to various amounts that the wife says that she has paid for and on behalf of the husband since the separation, and in addition there are amounts that the husband, she says, is obliged to pay, pursuant to orders of this court, which he has not.  There is a dispute about that though.

12. The husband says that he has paid the moneys that he has been ordered to, and he can establish that, but at this stage of the matter I am not in any position to make any finding about that.  The importance of it is that the wife says that if she is successful in her property settlement application in all its aspects there will be no payment to the husband. 

13. There has been recent authority in this area, and in particular a case of Strachan, a Full Court decision, delivered in the second half of last year.  The importance of that decision is that the Full Court addressed the principles that are applicable to partial property settlement applications, although that case was a case where there were significant assets, unlike this case, and that is an important distinction. 

14. The long and the short of it is the husband has established no basis whatsoever for there to be a partial settlement order in his favour.  Indeed, there are practical issues which stand in the way of such an application.  Firstly, there is no identifiable fund of money to meet his claim.  There is real estate, which is unencumbered, and which could be sold, namely the property at N, but the difficulty with that is the wife wishes to retain that property as part of her property settlement entitlement. She also says that if it is to be sold, although it might be valued at $25,000, there is upwards of $6000 that would need to be spent in selling costs and in addition she says that it would take some time to sell. 

15. The wife has described the land to me and I must say on that basis I would tend to agree with her submissions.  By that I mean, it does not sound to me like it is a piece of real estate which could be readily sold, and in the circumstances of this matter being, hopefully, listed for final hearing and heard in April or May, the odds are that it would take at least as long as that to sell, and thus there is no ultimate advantage to the husband as a result of that.  Yet it is perfectly obvious that a sale of that property is the only way that his claim for partial property settlement could be met.

16. The wife has said that if she has to pay the husband some money by way of property settlement that she would look to refinance the mortgages over the other items of real estate.  That is not something that she should be forced to do now to satisfy an order for partial property settlement given the significant dispute that is apparent from the party’s respective final orders applications.  That is important in addressing this application that the father makes because prima facie, if the wife is successful in her property settlement application and she does not have to pay the husband anything, then this payment of $12,500 would have to be refunded.  How the husband could do that he has not told me, and thus from all points of view, to repeat, there is no basis that the husband has established for why his application for partial property settlement should succeed.  Thus, I propose to dismiss the husband’s application.

17. Just so there is no confusion about that issue, though there was an earlier application by the husband which was of a similar nature and which had not been dealt with because this response that I have just heard is his latest application in this regard.  The previous application was filed on 9 October 2009.  In that application under the heading Financial Issues, the husband sought orders that the wife pay his outstanding disbursement accounts with his previous solicitors and that that be done by way of a partial property settlement order.  That was how the husband initially approached this matter, and I need to deal with that. 

[DISCUSSION & ORDERS]

I certify that the preceding 17 paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered on 25 January 2010.

Associate