Yates and Wilcox & Ors - [2017] FamCA 163

FAMILY COURT OF AUSTRALIA

YATES & WILCOX AND ORS

[2017] FamCA 163

FAMILY LAW – PROPERTY SETTLEMENT – Where the spouses agreed it would be just and equitable for their property interests to be adjusted – Where both spouses urged that their superannuation interests be treated as property – Where the wife’s greater capital contributions and greater income during the marriage are offset by the husband’s infusion of capital from an inheritance – Where the husband expects to generate substantial income upon the completion of a commercial development project in the near future – Where an adjustment of five per cent in favour of the wife would represent one-third of the least amount the husband expects to receive from the development project – Ordered five per cent adjustment in favour of the wife

FAMILY LAW – PROPERTY – Value of property – Where the spouses failed to settle a joint balance sheet – Where the spouses’ attempts to audit the monetary transactions between them and their corporate entities was misguided – Decided finding are made on the best evidence available – Decided the property adjustment process calls for a discretionary and holistic value judgment

Corporations Act 2001 (Cth), ss 459H, 1337H
Family Law Act 1975 (Cth), ss 75, 79, 90MT, 90MZD
Partnership Act 1892 (NSW)

Family Law Rules 2004 (Cth), r 14.06

Bevan & Bevan (2013) 49 Fam LR 387
Chorn v Hopkins (2004) FLC 93-204
Davey v Lee (1990) 13 Fam LR 688
Garrett v Garrett (1984) FLC 91-539
Marriage of Coghlan (2005) 33 Fam LR 414
Marriage of Parshen (1996) 21 Fam LR 199
Pierce v Pierce (1999) FLC 92-844
Quinn v Quinn (1979) FLC 90-677
Stanford v Stanford (2012) 247 CLR 108

APPLICANT:

Ms Yates

1st RESPONDENT:

Mr Wilcox

2nd RESPONDENT:

B Bank

3rd RESPONDENT:

Wilcox Pty Ltd

FILE NUMBER:

SYC

7648

2014

DATE DELIVERED:

21 March 2017

PLACE DELIVERED:

Newcastle

PLACE HEARD:

Sydney

JUDGMENT OF:

Austin J

HEARING DATE:

27 & 28 February, 1 & 2 March 2017

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Lawrence & Mr Reeves

SOLICITOR FOR THE APPLICANT:

Etheringtons Solicitors

COUNSEL FOR THE 1ST RESPONDENT:

Mr Neil QC & Mr Bell

SOLICITOR FOR THE 1ST RESPONDENT:

Horowitz & Bilinsky

COUNSEL FOR THE 2ND RESPONDENT:

No Appearance

SOLICITOR FOR THE 2ND RESPONDENT:	No Appearance
COUNSEL FOR THE 3RD RESPONDENT:	No Appearance

SOLICITOR FOR THE 3RD RESPONDENT:

Ms Corbett

COUNSEL FOR THE 3RD RESPONDENT:

No Appearance

Orders

All former interim orders made under Parts VIII and XIV of the Family Law Act are discharged.
The applicant wife (“the wife”) and first respondent husband (“the husband”), as trustees of the L Super Fund (“the Super Fund”), shall forthwith do all such things and execute all such documents necessary to:
(a)Cause the Super Fund to sell the real and personal property it beneficially holds; and
(b)Upon completion of such sales, cause the net proceeds to be deposited into a bank account of the Super Fund.
Declaration that the wife and husband, as the trustees…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Yates and Wilcox & Ors

Details

AGLC: Yates and Wilcox & Ors [2017] FamCA 163
Case: [2017] FamCA 163
Decision Date: 21 March 2017

CaseChat Overview and Summary

This matter concerned a property settlement dispute between a wife and husband, heard by Austin J in the Family Court of Australia. The parties had agreed that an adjustment of their property interests would be just and equitable. Both parties sought to have their superannuation interests treated as property for the purposes of the settlement. The wife's greater capital contributions and income during the marriage were acknowledged, but these were offset by the husband's infusion of capital from an inheritance and his expectation of substantial future income from a commercial development project.

The court was required to determine the appropriate property adjustment, considering the parties' respective contributions, financial resources, and future earning capacities. A key issue was the valuation and division of the parties' superannuation interests, specifically within the L Super Fund. The court also had to address the valuation of various corporate entities and loan accounts between the parties and these entities, as well as the division of other real and personal assets.

Austin J reasoned that a holistic and discretionary approach was necessary, applying principles of property adjustment under the Family Law Act. The court found that the attempts to audit monetary transactions between the parties and their corporate entities were misguided, and therefore made findings on the best available evidence. The court determined the value of the wife's interest in the Super Fund to be $735,373 and the husband's to be $1,167,195. An adjustment of five per cent in favour of the wife was ordered, representing one-third of the least amount the husband expected to receive from his development project. The court made extensive orders regarding the sale of Super Fund property, the division of splittable payments from superannuation interests, the transfer of various shareholdings and directorships, the forgiveness of loan accounts, and the dissolution of a partnership. The husband was ordered to pay the wife a sum of $489,319 within three months.

Orders

Orders of the court

All former interim orders made under Parts VIII and XIV of the Family Law Act are discharged.

The applicant wife (“the wife”) and first respondent husband (“the husband”), as trustees of the L Super Fund (“the Super Fund”), shall forthwith do all such things and execute all such documents necessary to:

(a) Cause the Super Fund to sell the real and personal property it beneficially holds; and

(b) Upon completion of such sales, cause the net proceeds to be deposited into a bank account of the Super Fund.

Declaration that the wife and husband, as the trustees of the Super Fund, have been accorded procedural fairness in respect of these superannuation splitting orders, and orders ancillary thereto.

Order that these orders are binding upon the wife and husband as trustees of the Super Fund.

Declaration, pursuant to s 90MT(2) of the Family Law Act, that for the purpose of these orders:

(a) The value of the wife’s interest in the Super Fund is determined to be $735,373; and

(b) The value of the husband’s interest in the Super Fund is determined to be $1,167,195.

Order, pursuant to s 90MT(1)(b) of the Family Law Act, that whenever a splittable payment becomes payable in respect of the husband’s interest in the Super Fund:

(a) The wife is entitled to be paid 100 per cent of the splittable payment out of the husband’s member account;

(b) There is a corresponding reduction in the entitlement of the husband to that splittable payment; and

Order 6 hereof has effect from the operative time, which is one business day after compliance with Order 2 hereof.

Order, pursuant to s 90MT(1)(b) of the Family Law Act, that whenever a splittable payment becomes payable in respect of the wife’s interest in the Super Fund:

(a) The husband is entitled to be paid 45 per cent of the splittable payment out of the wife’s member account;

(b) There is a corresponding reduction in the entitlement of the wife to that splittable payment; and

Order 8 hereof has effect from the operative time, which is one minute after compliance with Orders 6-7 hereof.

10.

The wife shall notify the husband in writing of the compliant superannuation fund into which her member account in the Super Fund should be rolled over.

11.

The wife and husband shall do all such things and execute all such documents necessary to cause the wife’s superannuation interest in the Super Fund to be rolled-out to that other compliant superannuation fund immediately upon compliance with Orders 6-10 hereof; and

12.

Immediately upon compliance with Order 11 hereof:

(a) The wife shall resign as a trustee of the Super Fund;

(b) The husband shall indemnify and keep indemnified the wife against any past or future liability in relation to her trusteeship of the Super Fund;

(c) The wife shall transfer to the husband all her right, title, and interest in the corporations G1 Pty Ltd and G2 Pty Ltd and resign any directorship of those corporations; and

(d) The husband shall indemnify and keep indemnified the wife against any past or future liability in relation to her directorship of those corporations.

13.

The husband shall pay to the wife the sum of $489,319 within three months of the date of these orders.

14.

Subject to compliance with Order 13 hereof:

(a) The husband is declared the sole legal and beneficial owner of the shareholdings held by the wife and husband in Wilcox Yates Pty Ltd and the wife shall forthwith do all acts and things necessary to transfer all her right, title and interest in her shareholding to the husband and to resign as a director of the corporation; and

(b) The husband is declared the sole beneficiary of the Wilcox Yates Family Trust and the wife shall forthwith do all acts and things necessary to relinquish and disclaim her status as a beneficiary of the trust.

15.

The wife is declared the sole legal and beneficial owner of the spouses’ shareholdings in Wilcox Pty Ltd (the third respondent) and the husband shall forthwith do all acts and things necessary to transfer all his right, title and interest in his shareholding in the corporation to the wife and resign his directorship of the corporation.

16.

The wife and husband shall forthwith do all acts and things necessary to cause the closure of B Bank Account No. …20 and the division of the credit balance between them in equal shares.

17.

The wife is otherwise declared the sole legal and beneficial owner of the real and personal assets in her possession, including:

(a) The real property situated at and known as C Street, Suburb D, NSW;

(b) Her shares in F Pty Ltd;

(d) The vessel named N;

(e) The Japanese car registered in her name;

(f) The German car registered in her name;

(g) Banking accounts held in her name; and

(h) Her artwork, furniture, jewellery, and personal effects.

18.

The husband is otherwise declared the sole legal and beneficial owner of the real and personal assets in his possession, including:

(a) The property known as GG Street, Suburb HH, Country II;

(b) His shareholdings in:

(i) J Pty Ltd;

(ii) E1 Pty Ltd;

(iii) E2 Pty Ltd;

(iv) E3 Pty Ltd; and

(v) I Pty Ltd;

(d) The Suburb JJ plot;

(e) His share in the racehorse;

(f) His furniture and personal effects; and

(g) His superannuation interest in COMPANY RR.

19.

The husband shall do all acts and things necessary to cause the following entities to forgive any debit loan account of the wife, is restrained from causing or permitting the entities to attempt recovery of such debt from the wife, and shall indemnify the wife against all liability in respect of such debt:

(i) Wilcox Yates Pty Ltd;

(ii) Wilcox Yates Family Trust;

(iii) J Pty Ltd;

(iv) E1 Pty Ltd;

(v) E2 Pty Ltd;

(vi) E3 Pty Ltd; and

(vii) I Pty Ltd.

20.

The wife is restrained from attempting to recover any money in satisfaction of any credit loan account from any of the entities specified in Order 19 hereof.

21.

The wife shall do all acts and things necessary to cause Wilcox Pty Ltd (the third respondent) to forgive any debit loan account of the husband, is restrained from causing or permitting the corporation to attempt recovery of such debt from the husband, and shall indemnify the husband against all liability in respect of such debt.

22.

The husband is restrained from attempting to recover any money in satisfaction of any credit loan account from Wilcox Pty Ltd (the third respondent).

23.

Pursuant to s 459H of the Corporations Act 2001 (Cth), the statutory demand dated 17 July 2015 served by the husband upon Wilcox Pty Ltd (the third respondent) is set aside.

24.

The wife and husband shall be solely liable for and shall indemnify the other against any and all debts attaching or relating to the property in their respective possession and any debts in their respective sole names, including any individual liability for capital gains tax arising out of the sale by them of property pursuant to these orders.

25.

The husband shall forthwith do all acts and things necessary to:

(a) Remove the caveat he caused to be registered over the wife’s real property situated at and known as C Street, Suburb D, NSW;

(b) Withdraw the PPSR registration number … in respect of the wife’s Japanese car; and

26.

Order that the partnership between the wife and husband known as the “Wilcox Yates Partnership” is dissolved forthwith.

27.

The wife and husband shall do all acts and things necessary to sell any and all partnership property and divide between them any surplus property in equal shares.

28.

In the event of the wife or husband refusing or neglecting to sign within 7 days of a written request to do so any document necessary to implement the terms of these orders the Registrar of the Family Court of Australia at Sydney is empowered to execute such documents on behalf of the parties pursuant to s 106A of the Family Law Act.

29.

The Application in a Case filed by the husband on 16 January 2017 is dismissed.

30.

Any and all other outstanding applications are dismissed.

Note: The form of the order is subject to the entry of the order in the Court’s records.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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