Yen and Yin

[2011] FamCA 1060

FAMILY COURT OF AUSTRALIA

YEN & YIN [2011] FamCA 1060

FAMILY LAW – PROPERTY – non-appearance by respondent – property in Country J – costs

Family Law Act 1975 (Cth)

APPLICANT: Ms Yen

RESPONDENT: Mr Yin

FILE NUMBER: MLC 2232 of 2010

DATE DELIVERED: 28 July 2011

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: 28 July 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms O'Connell

SOLICITOR FOR THE APPLICANT: Oakfair Lawyers

THE RESPONDENT: No appearance

Orders

1. That by 4.00pm on 31 August 2011, the husband:

   (a)Transfer to the Applicant/Wife or her nominee (at the Applicant/Wife’s expense) all shares held by him in B Pty Ltd ACN … (“B Pty Ltd”) and C Pty Ltd ACN … (“C Pty Ltd”) (collectively, “the said companies”).

   (b)In his role as a director of B Pty Ltd and of C Pty Ltd authorize the registration of the transfer of shares to the Applicant/Wife.

   (c)Do all acts and things and sign all documents necessary to resign any office or position now held by him in each of the said companies.

   (d)Assign to the Applicant/Wife all powers which are his in the Yin Family Trust (“the Trust”) (created by Deed of Trust settled by Mr D of which B Pty Ltd is trustee) and any subsequent amending Deed thereto (collectively, “the Trust Deed”);

   (e)Assign to the Applicant/Wife (or her nominee) any credit amount standing in his favour in any loan account of the Trust.    

   (f)Deliver up a deed under seal duly executed by him wherein he renounces, abandons and disclaims all rights or entitlements which are his pursuant to the Trust Deed;

2. As from the 30^th August 2011, the Applicant/Wife do cause each of the said companies and the Trust to solely meet their proper debts and liabilities, including the loans secured by fixed and floating charges upon B Pty Ltd and the mortgage loans to Bank of Queensland secured upon Units … E Street, City F and G Street, City F (collectively, “the said loans”) and she otherwise indemnify the Respondent/Husband against any liability arising in his name in respect of the said companies, the Trust and/or the said loans SAVE THAT nothing requires the Applicant/Wife to meet any taxation liability of the Respondent/Husband.

3. In the event the Respondent/Husband does not comply with paragraph 1 of these Orders THEN pursuant to s 106A of the Act, the Registrar of the Family Court of Australia is hereby appointed and authorized to execute all documents in the Respondent/Husband’s name.

4. For the purposes of establishing any default as contemplated by paragraph 3 of these Orders, an affidavit from the Applicant/Wife’s solicitor on record to that effect be sufficient evidence of the default.

5. That 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 in Australia (including choses-in action) in the ownership, possession or control of such party as at the date of these orders (and for these purposes furniture, personal possessions and chattels in or upon G Street, City F and Units … E Street, City F are deemed to be in the possession of the Applicant/Wife).

   (b)Monies standing to the credit of the parties in any joint bank account in Australia shall become the property of the Applicant/Wife.

   (c)All superannuation benefits or entitlements of the Applicant/Wife in any superannuation fund in Australia be retained by her for her sole benefit.

   (d)Any joint tenancy of the parties in any real or personal estate in Australia is hereby expressly severed.

6. That of all documents and Orders of this Court be effected upon the Respondent/Husband by the solicitor for the Applicant/Wife causing them to be forwarded by pre-paid airmail post in an envelope addressed to the Respondent/Husband at H Street, City I, Country J.

7. That the husband pay the wife’s costs fixed in the sum of $30,800.

8. Upon the wife receiving the transcribed reasons for these4 orders, a copy be forwarded to the husband by the method referred to in paragraph 6 hereof.

9. All outstanding applications are otherwise dismissed.

10. All annexures to the affidavits filed be forthwith returned to the wife.

11. That the reasons given this day be transcribed.

IT IS NOTED that publication of this judgment under the pseudonym Yen & Yin has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 2232 of 2010

Ms Yen

Applicant

And

Mr Yin

Respondent

REASONS FOR JUDGMENT

1. On 12 March 2010, the wife in these proceedings filed an application seeking a property settlement.  The matter was listed for hearing as a case assessment conference on 17 May 2010, and the court record notes that the wife attended but the husband did not.  The registrar conducting the conference was satisfied as to the fact that the husband had been served, and adjourned the proceedings to 14 September 2010 for the purposes of a possible undefended hearing if the husband failed to comply with a variety of further orders made that day.  The registrar then went on to make an order that the husband file and serve by 13 August a variety of documents, including a response, a financial statement, and details as to various assets.

2. For reasons which are not entirely clear, the matter did not seem to come back on for hearing in September 2010, but the next hearing arose when the case was docketed by me on 12 April 2011.  The record shows that on 12 April 2011 the husband had not filed any material as had been ordered by the registrar on 17 May 2010.  The orders I made on 12 April were directed to both parties to file various documents and to attend for hearing on 3 June 2011.  On 3 June 2011, I was sufficiently satisfied that the husband either was aware, or should have been aware, of that date, and because there were some difficulties in the matter then proceeding, I adjourned the hearing for final determination on 28 July 2011 at 10 am, which is today.

3. At 10 past ten today, the husband was called and there was no appearance.  The wife relied on an affidavit filed on 15 July of her solicitor, indicating that the documents had been served according to the orders that I had made on 3 June.  In addition to that material, there is affidavit material from the wife before me indicating that on 8 June 2011, when the solicitors received a sealed copy of the order of the court, she was aware that the order was posted to the husband.  For reasons that are a little unclear, the wife then gave her son a copy of the orders as he was leaving Australia to go to Country J, and he gave a copy of that order to his father.

4. The wife then deposes to the fact that her son informed her by telephone on 10 June that he had given his father a copy of the document and read the contents to him.  Five days later, on 15 June 2010, she said the son telephoned her and had received the letter from the solicitor enclosing a copy of the order, and that the husband was furious.  The importance of all of that is that I need to be satisfied that the husband has had an opportunity to be heard.  It is clear from his silence that he does not intend to participate in these proceedings.  He has had an opportunity by virtue of the orders of the registrar in May 2010 and the orders of the court of 3 June to do something about the matter, and has not participated at all.  I can conclude, therefore, that he is aware of the proceedings, and has deliberately chosen not to participate.

5. When a person who is a litigant in these proceedings has to go to the trouble of concluding the financial relationships between that person and their former partner, it generally means that there is a communication problem, or a stubbornness, or an inability to work out what the correct answer is without having that assistance.  This is one of those cases where the wife has had to go to the length of issuing litigation, but also, as I shall set out in a moment, some further steps to try and conclude the financial relationship as a result of the ending of the marriage.

6. Accordingly, I am satisfied that as the husband is aware that he has an obligation to try and assist sort out the matter, and the wife has gone to the trouble of issuing the litigation and pursing it, it is appropriate for the wife to be given leave to proceed on an undefended basis.  The wife relies upon an amended application filed 5 May 2011, together with an affidavit of 12 March and 24 June filed by her, together with an affidavit of her accountant as to values of a business which is property of the parties, or either of them, and also a real estate valuation.  The two valuation affidavits were filed on 24 June and 7 July respectively.

7. The wife also filed a financial statement on 12 March 2010, and gave oral evidence indicating that there had been some alteration to that position.  The affidavit of the accountant probably gives a better picture of her financial position, and it would be sufficient to say that she is not impecunious.  The background of this property application is relatively simple.  I do not need to set out in great detail that background, suffice to say that this is a long marriage.  Importantly, as the husband has had all of the material, and not disputed it, I can presume that, having read it, he does not challenge any of the things that are there said.

8. The wife is currently 62 years of age.  She was born in Country J.  The husband is 65 years of age, and he was born in Country J as well, and appears, on all of my understanding of the evidence, to be still residing there.  The parties married in 1979, according to Chinese marital rights.  That marriage took place in City I.  There again is no dispute from the husband about the fact that that was a marriage according to Country J law as such.  As such it is a marriage recognised in Australia.

9. There is one child of the relationship to whom I have already referred, who was born in 1986.  He is currently aged 24 years, living in City F with the wife, and studying at University K, and to some extent, therefore, albeit he is an adult, he is financially dependent upon the wife. 

10. In the two affidavits to which I have referred there is a comprehensive history set out about the purchase of various assets.  It seems clear that at the commencement of the relationship, which occurred prior to the marriage, neither party had any assets of any great significance.  What they have, however, amassed, is quite a considerable amount of property, both in Australia and in Country J, subsequent to 1979.

11. This is, therefore, a long marriage.  The evidence would suggest that each of the parties has contributed according to their best endeavours, and there is no suggestion from the husband that he disagrees with what the wife says.  I am satisfied on the evidence that the financial contributions of the wife have been significant, and there is an equal assumption I can draw that her role as a homemaker and parent has been equally significant in this relationship.  Based upon the material before me I am satisfied about the asset pool.  The wife’s evidence is that in Australia the parties have two real properties in the central business district, from which corporate entities, which are either trading entities, or trustees of trusts, conduct businesses.

12. The wife’s evidence was that she relied upon the affidavit of the real property valuer, and the accountant to give details as to the valuation of those assets.  In summary, the various entities as valued show that there is currently a pool of assets in Australia which, when debts are taken into account, leaves the current net pool of about $5.5 million.  During the intervening period since I heard the case in June, the wife travelled to Country J.  She there undertook quite an extensive exercise of tracing the assets of the husband, and she set out in some detail what ownership of various properties, and presumed from the records that the encumbrances which were referred to on the assets still existed.

13. All of those calculations as to value, both as to the asset and to the liability, were in Country J currency.  The Country J currency exchange rate at the moment is about one Australian dollar to three Country J dollars.  Based upon those inquiries, and on the exchange rates, what the wife ascertained was that there is a minimum net asset pool in Country J worth $A10 million.  I say a minimum because the liabilities she has used appear to be the noted encumbrances on the public record.  It is conceivable in the circumstances that the encumbrances have been reduced since the acquisition of those assets.

14. In those circumstances, without any assistance from the husband, and on the basis of the wife doing the best she could, I can be satisfied that there is a pool of equity in Country J worth about $A10 million.  If the two pools are added together it would mean that there is approximately $A15.5 million.  Some of those assets in Australia in the pool to which I have referred include superannuation.  The wife’s Australian superannuation benefits lie with the AMP Company.  The wife has valued those at $125,000.

15. While superannuation should normally be treated as a different species of property to assets which are otherwise easily identifiable, this is a case, where, having regard to the age of the wife, there seems to me to be no logical purpose in separating it out from the other assets, and for that reason I propose to treat it as all one part of the pool. Accordingly, for the purposes of s 79 of the Family Law Act 1975 I am satisfied that the pool of assets is approximately $15.5 million.  For the reasons I have earlier set out there does not seem to me to be any logical reason to find that the parties have contributed other than equally between themselves over the long marriage.  Accordingly I make a finding that the parties have so contributed equally.

16. The third step required of the Court in s 79 of the Act is to address the issues set out in s 75(2). Those matters are sometimes described as the economic indicators of the future of each party. In this case there are no children under the age of 18, nor are there any suggestions that either party has any financial problems. The wife’s income is reasonable, and she seems to be able to live comfortably on those funds, and she has the benefit of the future businesses arising out of the companies and the trusts. There is no logical reason in this case why I ought to depart from the finding in relation to contributions. I propose, therefore, not to make any further adjustment to the factors set out in s 75(2) of the Act.

17. The fourth and the final step is to make whatever orders are necessary arising out of that pathway that effectively give a just and equitable outcome.  It is the underlying value of what each party receives that must be just and equitable, and not the percentage determination.  Here I have an unusual position in that the wife’s application seeks only the transfer to her of the property that lies in the assets in Australia.  She gave evidence that she is aware of the disparity between the Country J assets and the Australian assets, but, after some consultation with her lawyers, she confirmed that she did not intend to pursue any property settlement in Country J.

18. In other words, any money or property that may lie in the hands of the husband in Country J will rest there forever, and to the extent the wife changed her mind and brought proceedings in Country J in relation to those assets in the future, the husband would be able to point to the orders in Australia and say that the Court here has actually made a determination about those assets, notwithstanding that they are beyond Australian shores.  This is a case, therefore, where the wife is adamant that she understands the disparity.  She has had legal advice.  She knows that there is a prospect of her pursuing assets in Country J, because she has had legal advice in Country J.

19. She said she did not want to pursue the husband in Country J because he is a ferocious man, and she is frightened of him.  Under those circumstances, albeit I have some reservations about the disparity between what the parties are receiving, I am satisfied that it is a commercially viable alternative to an otherwise difficult division of assets of the parties, and, as I am dividing up all of the property of the parties, and not just the assets in Australia, I am satisfied that the orders that she is seeking are just and equitable to both parties in the circumstances.  Having made those findings, there is no reason for me not to make the orders as requested by the wife.

20. The wife also makes an application for costs. Section 117 of the Family Law Act provides that each party shall bear their own costs, unless there are circumstances that justify the Court departing from that principle. The Court is obliged to take into account the matters set out in s 117(2)(a) of the Act. Those particular provisions require the Court to consider the financial circumstances of the parties. I am well aware of their financial circumstances, now having determined the matters that I have earlier set out.

21. There are clearly no legal aid considerations in this case.  There are also, importantly, indications that the husband has not assisted the Court by complying with its orders, and, under those circumstances, I can conclude that the wife has been put to the inconvenience and cost of having to bring the proceedings.  The wife’s costs are not anything unusual.  This is not a case where I could be justified in making an order for indemnity costs.  However, the wife has estimated that she has incurred, including the costs of getting the case ready for trial, approximately 50 hours worth of work.

22. That comes about on the basis of about 31.8 hours, plus the preparation for today, and the allowances for the preparation of the voluminous documents in this particular case.  It is my estimate that those hours amount to 50, rather than of the wife.  The scale is approximately $200 per hour, or just short of that sum, and it seems to me in the circumstances $10,000 is the appropriate amount for the professional costs.  The wife, however, has also incurred professional costs in the sense of disbursements.  She has had counsel’s fees for the various hearings before me, and an attendance on senior counsel for the purposes over a number of days of getting advice, and preparing the way for the determination of the matter.

23. In addition, she has incurred the valuation expenses, which, had the husband been here, he may have enabled her to avoid, by making concessions.  The total disbursements to date are just over $20,800.

I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 28 July 2011.

Associate: 

Date:  11 January 2012