B v B HC Dunedin CIV-2011-412-000328

[2011] NZHC 1937

NOTE: PURSUANT TO S 169 OF THE FAMILY PROCEEDINGS ACT 1980, ANY REPORT OF THIS PROCEEDING MUST COMPLY WITH SS 11B TO

11D OF THE FAMILY COURTS ACT 1980.  FOR FURTHER INFORMATION PLEASE SEE WWW2.JUSTICE.GOVT.NZ/FAMILY/LEGISLATION/RESTRICTIONS.

IN THE HIGH COURT OF NEW ZEALAND DUNEDIN REGISTRY

CIV-2011-412-000328

BETWEEN  B Appellant

ANDB Respondent

Hearing:         5 August 2011

Counsel:         LA Andersen for Appellant

AJ Logan for Respondent

Judgment:      26 September 2011 at 4:00 PM

JUDGMENT OF RODNEY HANSEN J

This judgment was delivered by me on 26 September 2011 at 4.00 p.m., pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date: ………………………….

Solicitors:           Antony Hamel Lawyer, P O Box 1440, Dunedin for Appellant (AH Hamel)

Ross Dowling Marquet Griffin, P O Box 1144, Dunedin for Respondent (AJ Logan)

B V B HC DUN CIV-2011-412-000328 26 September 2011

Introduction

[1]      In 2003 the respondent (Mr B) was ordered to pay his former wife (Mrs B) spousal maintenance of $1,900 per month.  In 2010 Mr B applied to discharge the order.   On 6 April 2011, Judge Twaddle made an order discharging the spousal maintenance order from 30 September 2011.

[2]      Mrs B appeals against Judge Twaddle’s decision.  She says he was wrong to find that she is now able to provide for her own needs.  Mr B cross-appeals against the Judge’s failure to make a costs order in his favour.

Further background

[3]      Mr and Mrs B married in 1984.  They separated in 2002.  The marriage was dissolved in 2004.

[4]      There are five children of the marriage:  T aged 20, P aged 18, J aged 16, A aged 13 and K aged 11.   At the time the maintenance order was made, all five children were in the care of Mrs B.  Over the ensuing years, the three boys went to live with their father.  P and J remain with him.  T is now flatting.  The two girls remain in the care of Mrs B.

[5]      The  youngest  child,  K,  has  special  needs.     She  suffers  from  Downs Syndrome.   Mrs B’s position is that K’s requirements for special care prevent her from meeting her own financial needs.   Mr B disputes that.   He has the financial ability to continue paying spousal maintenance but says he should not be required to do so.

Statutory provisions

[6]      The application to discharge the maintenance order is made under s 99 of the

Family Proceedings Act 1980 (the Act).   In considering such an application, the

Court is required to have regard to the principles of maintenance set out in s 62 – 66 and s 81.   Those which are relevant to spousal maintenance after a marriage has dissolved are ss 64 and 64A.

[7]      Section 64(1) provides that each spouse is liable to maintain the other to the extent that such maintenance is necessary to meet the reasonable needs of the other spouse where he or she cannot practicably meet the whole or any part of those needs because of one or more of the circumstances specified in s 64(2).  The circumstances include the ability of a spouse to become self-supporting, having regard to the effects of the division of functions within the marriage while the spouses lived together1 and the  responsibilities  of  the  spouse  for  the  ongoing  daily  care  of  any  minor  or dependent children of the marriage after the dissolution of the marriage.2

[8]      Section 64(1) is expressly made subject to s 64A, subs (1) of which provides:

64ASpouses, civil union partners, or de facto partners must assume responsibility for own needs within reasonable time

(1)      If a marriage or civil union is dissolved or, in the case of a de facto relationship, the de facto partners cease to live together,—

(a)       each spouse, civil union partner, or de facto partner must assume responsibility, within a period of time that is reasonable in all the circumstances of the particular case, for meeting his or her own needs; and

(b)      on the expiry of that period of time, neither spouse, civil union partner, or de facto partner is liable to maintain the other under section 64.

[9]     However, maintenance can only be required if one of the qualifying circumstances in s 64(2) exists and it is reasonable in terms of s 64A(2) for maintenance to be paid.  Section 64A(2) provides:

(2)       Regardless of subsection (1), if a marriage or civil union is dissolved or, in the case of a de facto relationship, the de facto partners cease to live together, one spouse, civil union partner, or de facto partner (party A) is liable to maintain the other spouse, civil union partner,

1      Family Proceedings Act 1980, s 64(2)(a)(i).

2      Ibid, s 64(2)(b).

or de facto partner (party B) under section 64, to the extent that such maintenance is necessary to meet the reasonable needs of party B if, having regard to the matters referred to in subsection (3),—

(a)       it   is   unreasonable  to   require   party  B   to   do   without maintenance from party A; and

(b)       it is reasonable to require party A to provide maintenance to party B.

[10]     The matters referred to in subs (3) are: (a)       The ages of the spouses.

(b)      The duration of the marriage.

(c)       The ability of the spouses to become self-supporting, having regard to –

(i)The  effects  of  the  division  of  functions  within  the marriage while the spouses were living together:

(ii)      The likely earning capacity of each spouse:

(iii)The  responsibilities  of  each  spouse  for  the  ongoing daily care of any minor or dependent children of the marriage after the dissolution of the marriage:

(iv)      Any other relevant circumstances.

Original order

[11]     The  original  spousal  maintenance  order  was  made  by  the  late  Judge Inglis QC on 9 June 2003.  As it was made before the marriage was dissolved, the order was made pursuant to s 63 of the Act which, like s 64, provided that each spouse is liable to maintain the other to the extent necessary to meet the reasonable needs of the other spouse where those needs cannot practicably be met because of the specified circumstances.  Judge Inglis found that Mrs B’s ability to become self- supporting had been limited by the effects of the division of functions within the marriage.  Mr B was the income-earner and, following the birth of their first child, Mrs B had  confined  herself to managing the  children and the home.   She had maintained primary responsibility for the children’s care and upbringing.   Judge Inglis described as ―unreal‖ the suggestion made by Mr B (who represented himself at that hearing) that his wife could have gone out to work while, at the same time,

remaining primarily responsible for the children’s care.  Judge Inglis said that any suggestion that Mrs B might then go out to work, even assuming work was available, was also unreal because of her commitment to the children and especially to K.3

[12]     Judge Inglis also referred to the superior standard of living which the parties had been able to enjoy by virtue of Mr B’s earning power.   (In addition to his earnings as a solicitor, he derived significant income from rental properties.)  The final factor he referred to was the issue of Mrs B undertaking a period of education or training to increase her earning capacity.  He saw her ability to do that as limited,

―at least for the present‖.   He concluded that Mr B was under a liability to maintain Mrs B to the extent that she was unable to provide for her own reasonable needs.  He concluded:4

Until   the   wife   is   in   a  position  to   move   towards   greater   financial independence her reasonable needs to be met from income are not to be set as (sic) subsistence level but should be set at a level which provides her with a reasonable degree of comfort.   On any view the husband has more than enough resources to meet his own reasonable needs.

Change of circumstances

[13]     Section 99 of the Act permits the Court to vary a maintenance order where it is satisfied that it ―ought to do so‖, having regard to the principles set out in ss 62-66 and 81 of the Act.  The onus is on the applicant to show that the order should be varied.5    That requires proof that there has been a change of circumstances from those prevailing at the time the original order was made.  The change must have led to a situation where the variation  of the order  is required having regard to the relevant statutory provisions.

[14]     There have been material changes in circumstances since the order was made. The marriage was dissolved on 15 April 2004.   The eldest child, T, is now living independently.   The other two boys, P (18) and J (16) are now living with their father.  The girls remain with their mother.  A (13) is at secondary school.  K, now

aged 11, is at school.  She is in her last year at primary school which she has been

3 At [60].

4 At [66].

5      Robson v Robson (1988) 5 NZFLR 291.

attending under a special programme which enables special needs children to be educated in a mainstream school.

[15]     Mr B contended that Mrs B was in a position to meet her own needs.  He said that, with K now settled into school, her mother no longer needed to be available for her all the time and was in a position to earn for herself.

[16]     Mrs B disputed that.  She maintained that K was still dependent on her and that it would be unreasonable to expect her to commit to gainful employment before K had settled into a new school next year.

Judge Twaddle’s decision

[17]     Judge Twaddle acknowledged that K’s special needs must be recognised.  He lamented the lack of independent evidence, for example from a paediatrician, about her present and likely future needs.  He was unable to resolve conflicting evidence as to her reasoning skills.  Mrs B had said that K’s reasoning skills were equivalent to that  of a typically developing 4-year-old.    Mr B had  disputed that,  pointing to improvements in her speech and reasoning; an improved ability to take responsibility for such matters as personal hygiene; and the way in which she could contribute to household chores.  It was, however, common ground and accepted by the Judge that K was prone to act impulsively and required monitoring.

[18]     The  Judge  described  Mrs  B  as  ―an  intense,  serious  person,  who  has  a tendency to be over-protective of K‖.   He said that over the years her focus on meeting what she saw as K’s needs had ―narrowed to the point where she lacks balance and has become unreasonable‖.  He questioned Mrs B’s assumption that she was the only one who could fully understand or meet K’s needs.  He said it was at least possible, as suggested by Mr B, that it would be in K’s interests to have a greater level of independence than Mrs B gives her at present.

[19]     Judge  Twaddle  did  not  accept  Mrs  B’s  evidence  that  she  needed  to  be

―constantly on call‖ when K is at school.   He referred to evidence that over the previous year Mrs B had gone to K’s school on three occasions when she had soiled

herself, three occasions for health reasons and an unspecified number of times to take spare glasses to her.  He commented that there should be no reason why a spare set of glasses could not be left for K at school.  He said he found it difficult to see why, on the basis of Mrs B’s evidence, she had not been able to complete any course or retraining.

[20]     Judge Twaddle was critical of Mrs B’s reluctance to allow Mr B and his sister to help with K.  He noted that Mr B had the care of K every second weekend and K had stayed with him when Mrs B travelled overseas.  He thought her attitude was based mainly on her dislike of Mr B and was ―not reasonable‖.

[21]     Judge Twaddle concluded:6

A major difficulty in Mrs B’s position is that there may be no end to what was supposed to be a temporary maintenance arrangement; K may settle into intermediate school next year, but then Mrs B may be concerned about her transition to secondary school, or to another school if secondary school is not appropriate and want to be available fulltime to support her then.   In my view, such an open-ended position is not what is contemplated by the Act, in relation to spousal maintenance.

I conclude that Mrs B has had seven years since the marriage was dissolved to take steps to provide for her needs and that this is a reasonable time in all the circumstances.

Submissions on appeal

[22]     Mr Andersen’s main criticism of the judgment was that it focused on the requirement in s 64A that Mrs B support herself within a reasonable period without proper consideration of what is a reasonable period in the circumstances.   He submitted that the combination  of ss 64  and 64A envisages  a transition  over a reasonable time having regard to the factors relevant to a grant of spousal maintenance.  Mr Andersen said that Judge Twaddle’s decision necessarily implied that either Mrs B would be self-supporting by September 2011 or that she would have been self-supporting if she had acted reasonably.  He argued that a finding that Mrs B had acted unreasonably had insufficient regard to the practicalities of her

situation.

6      B v B FC Dunedin, FAM-2002-012-1020, 6 April 2011 at [43] – [44].

[23]     Those practicalities included the fact that Mrs B had been out of the work force for twenty years; the courses or retraining that would be available for her to undertake;  whether  her  earning  capacity  would  be  enough  to  make  her  self- sufficient; and how K’s needs would be met while she settled into a new school. Mr Andersen submitted that a proper weighing of these sort of matters would have led to a decision which gave Mrs B more time prepare for financial independence.

[24]     In supporting the Judge’s decision, Mr Logan submitted that Mrs B’s case rested on her contention that she had to be constantly available on call for K.  He argued that the evidence did not support her position.  He pointed out that K had now had six years at preschool and primary school.  Records for the 2010 year showed she had missed only five and a half school days.   He referred to the additional support available to K through a resource teacher and teacher aides and offers by Mr B to make himself and his sister available on call and to pay for after school care for K. These offers have been rejected.

[25]     Mr  Logan pointed out that, as the former personal assistant  to the chief executive of a national company, Mrs B had secretarial, clerical and word processing skills.   She had made little effort to upskill and had not sought any kind of appointment.  She had been put on notice in March 2010 that Mr B would seek to end his liability to pay spousal maintenance but had done nothing to get herself back into the work force.   He submitted that it was Mrs B’s personal choice that has caused her to be unable to meet her own reasonable needs.  She is entitled to choose not to work but she is not entitled to require her former husband to pay for her personal choice.

Decision

[26]     The key issue in this case is one of timing.  Mrs B accepts that she cannot expect to be supported by Mr B indefinitely.  In essence, she asks for more time so that she can see K settled into her new school next year and can better prepare herself for re-entry into the workforce.   Judge Twaddle thought otherwise.   He agreed  with  Mr B that  she had  had  enough  time.    In  short,  he found  that  her responsibilities  to  K  no  longer  provided  good  reason  to  keep  her  out  of  the

workforce.   Put in terms of s 64A(2), he found it is not unreasonable to require Mrs B to do without maintenance from Mr B and that it is not reasonable to require him to provide maintenance to her.

[27]     In  Z  v  Z  (No  2)7   the  Court  of Appeal  discussed  the  way  in  which  the provisions of the Act applied to maintenance after divorce, commenting8  that the principles enunciated in Slater v Slater9  have been either misconstrued or applied with undue rigidity in practice.   The Court observed that while intended to give effect to the clean break principle and encourage former spouses to become independent  and  self-sufficient  after  the  dissolution  of  marriage,  nothing  in  the

provisions or scheme of the Act requires this objective to be carried through to the point where the provisions operate unfairly and harshly on one or other of the spouses.   While it was accepted that the legislation clearly indicates that any maintenance obligation following dissolution of marriage should ordinarily be temporary, there is nothing in the wording of the Act to preclude a lengthy period of time, or even an indefinite period.10    Section 64A(2) is an ameliorating provision11 which recognises that, by virtue of such factors as the ages of the parties and the duration of the marriage, it may be reasonable for maintenance to continue indefinitely.

[28]     In the circumstances in which Mrs B finds herself, I respectfully differ from the  Judge’s  view  that  maintenance  should  not  continue  for  a  further  period.    I consider that he had insufficient regard to the particular difficulties she faces achieving financial independence.

[29]     What is being expected of Mrs B must be seen in context.  At the age of 55, she has had a lengthy period engaged in exclusively child-focused activities.   She said in evidence that she had been ―first and foremost a mother‖.  Having been what she described as ―a latchkey kid‖ herself she became totally dedicated to giving her

children the best opportunity they could have.  While Mr B continued with his career

7      Z v Z (No 2) [1997] 2 NZLR 258 (CA).

8      Ibid, at 293.

9      Slater v Slater [1983] NZLR 166 (CA).

10     Z v Z (No 2), above n 7, at 294.

11     Slater v Slater, above n 9 at 174.

and his family business interests (his separate property), she gave up her career and devoted herself to the care of a (by contemporary standards) large family.  When the marriage came to an end, the two youngest children were still pre-schoolers.  It is not at all surprising that Judge Inglis should have rejected as ―unreal‖ Mr B’s suggestion at that time that his wife could have gone out to work.

[30]     Of course, much has changed since then.   But the challenges faced by a woman   in   her   mid-fifties   re-establishing   herself   after   25   years   engaged predominantly in child  rearing activities should not  be understated.   They were recognised by the Court of Appeal in M v B.12   Hammond J referred to the obvious difficulties faced by a woman (in that case, in her early fifties) with ―distinct credentials and opportunities for her own life‖13  who had deflected those opportunities in support of the family.  He said:14

She then faced the difficulties – well detailed in the evidence, and which need not be rehearsed here – of turning her life around while faced with subsisting obligations to children and ―restarting‖ a career in her fifties.   I would not underestimate the difficulties inherent in such a course, and more importantly, they are well apparent in the evidence in this case.

My concern, as this Court observed in Z v Z (No 2) (at pp 294 – 295), is that care has to be taken not to press the clean-break principle too far. One of the difficulties with formal equality approaches to relationship property and maintenance was that the notion that women ought to be able to remain financially independent of former husbands after divorce could be too readily invoked to castigate dependent women in the very name of those equality principles.

[31]     I consider also that Mrs B’s concerns about K should have been accorded greater weight.   It appears that K generally has coped well at school and that the demands on Mrs B have been relatively few.  But I consider she has been entitled to keep herself on standby, as it were, and that she has well-founded worries about how K will cope when she goes to intermediate school next year.  It will be a big change for her as she will be one of few children with high special needs attending the school.  I do not think it unreasonable for Mrs B to keep herself generally available to support K during that crucial period.

[32]     The Judge said15  that Mrs B had had seven years since the marriage was dissolved to take steps to provide for her needs.  In reality, though, it is only in recent times that she could have taken meaningful steps to acquire the skills she needs to re- enter the workforce.  Mr B says that she has been on notice since March 2010 that spousal maintenance would come to an end at the end of 2010 but that was in the context of an offer to pay reduced spousal maintenance until payments ended altogether at the end of 2010.  The additional assistance Mr B says he and his sister are  prepared  to  provide  was  similarly associated  with  the  application  to  cancel maintenance.   It may prove to be important as  Mrs B moves towards financial independence as part of a transition which will necessarily require adjustments to the roles each parent has previously undertaken for K’s care.

[33]     I acknowledge the Judge’s concern16  that Mrs B’s worries about K could become an ongoing justification for maintenance.  I readily accept that a time must come when K’s needs cannot be relied on to justify maintenance continuing.  But I take the view that time has not arrived and, when regard is had to all the circumstances (including Mrs B’s age and the duration of the marriage), it would be unreasonable for her to be required to do without maintenance from 30 September and that it is perfectly reasonable to require Mr B (who has the means) to continue supporting her.

[34]     I do not see this as giving rise to a commitment of indefinite duration.  It is to enable Mrs B to be on hand while K becomes established in her new school and to give her the opportunity to make preparations for financial independence.  I consider she should have the calendar year 2012 available for this purpose.  In keeping with

the general desirability of making maintenance orders finite in term,17 I am satisfied

that maintenance should cease on 31 December 2012.

Cross-appeal

[35]     The judgment makes no reference to costs.   I was told the subject was not raised at the hearing. After delivery of the judgment, Mr B applied for a rehearing to address the issue of costs.  Mrs B opposed the application.  Nothing happened.  The application remains outstanding.

[36]     Mr B cross-appeals on the ground that the Family Court erred in failing to consider costs, to invite submissions on costs, and to award costs to the respondent.

[37]     Mr Andersen submitted that the Family Court had no jurisdiction to award costs as it was functus officio and that it would be inappropriate for this Court to make  an  order  which  the  Family  Court  had  no  jurisdiction  to  make.    If  it  is appropriate to reconsider the issue of costs, Mr Andersen said the matter should be referred back to the Family Court.

[38]     As Mrs B has succeeded in her appeal, the issue is moot.  An application by Mr B for costs could not succeed.   But in case Mrs B is minded to pursue an application for costs in the Family Court, I will briefly deal with its jurisdiction to award costs in this case.

[39]     In  support  of  his  submission  that  the  Family  Court  was  functus  officio, Mr Andersen relied on Thomson v Thomson18  where the Family Court had made a consent order allowing the respondent mother to take custody of the child. The order did not refer to costs.   The order was sealed.   The respondent then applied to the Family Court for costs and was awarded costs.  On appeal, the order was quashed. Grieg J held that because the judgment had been perfected without the question of costs being reserved, there was no power to reactivate the judgment or alter it by adding a costs order.

[40]     Thomson is immediately distinguishable as the judgment in this case has not been sealed.   However, in my respectful view, the Family Court had  (and has)

18     Thomson v Thomson [1993] NZFLR 315 (HC).

jurisdiction to award costs whether or not the order has been sealed.  Two decisions of this Court on appeal from the Environment Court support that view.

[41]     In National Investment Trust v Christchurch City Council19  Young J was asked to consider whether an Environment Court Judge was unable to make an order for costs following a decision on the substantive issue because he was functus officio. It was held that the general power conferred on the Environment Court to make an order for costs did not operate to restrict its discretion to award costs after a decision had been delivered.   It was further held that if costs were not sought, due to a mistake or oversight of the Court, or if  an application for costs was  not made because counsel had not appreciated that their client sought costs, or if the Judge failed to reserve costs, the slip rules in rr 11 and 12 of the District Court Rules permitted any mistake or oversight to be remedied.

[42]     In Wilson v Selwyn District Council20  Fogarty J held that the sealing of an order in the Environment Court which made no order for costs and did not reserve costs, did not preclude an award of costs.   Fogarty J held that the Court was not functus officio.  He said:21

Hearing an application for costs by either the respondent or the applicant when the main judgment is silent on costs does not amount to varying or altering a judgment already given and thus undermine the principle of the need for finality of litigation.

[43]     I respectfully agree with Fogarty J’s conclusion and with the reasoning that preceded it.  The authorities he referred to, specifically Dymocks Franchise Systems (NSW) Pty Ltd v Todd (No 2)22 and Caboolture Park Shopping Centre Pty Ltd (in liq)

v White Industries (Qld) Pty Ltd,23  make it clear that there is jurisdiction to make

supplemental orders provided they do not offend the principle of finality.  It is not open to a party to seek to vary or alter a judgment but, in a proper case, further or

consequential relief may be sought, including an order for costs.

19     National Investment Trust v Christchurch City Council [2001] NZRMA 289 (HC).

20     Wilson v Selwyn District Council HC Christchurch CIV-2004-485-720, 15 December 2004.

21 Ibid, at [14].

22     Dymocks Franchise Systems (NSW) Pty Ltd v Todd (No 2) [2004] UKPC 39, [2005] 1 NZLR

145.

23     Caboolture Park Shopping Centre Pty Ltd (in liq) v White Industries (Qld) Ltd (1993) 45 FCR

224.

[44]     Section 171(1) of the Act makes specific provision for an order for costs.  It provides:

171     Costs

(1)       Subject to any other provision in this Act, the Court, on the hearing of any proceedings before it under this Act, may make such order as to costs as it thinks fit.

I am satisfied that the power may be exercised in this case either in the exercise of its general jurisdiction to make supplemental orders or pursuant to the slip rule.24

[45]     The Family Court could have made an award of costs in favour of Mr B. Likewise, Judge Twaddle would now be able to make an order in favour of Mrs B if he saw fit, for which purpose I will remit the issue of costs to the Family Court for consideration.

Result

[46]     The appeal is allowed.  The order that maintenance for Mrs B will terminate on 30 September is quashed.   In its place I make an order that the existing maintenance order is to continue until 31 December 2012.   Any issue of costs in relation to the Family Court hearing is to be determined by the Family Court.

[47]     Mrs B is entitled to costs on the appeal on a category 2 band B basis.

24     Rule 204 of the Family Courts Rules 2002 allows correction of clerical mistakes and slips.