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Waldrop & Chatelet [2012] FMCAfam 1048

Categories: Special Circumstances, Spousal Maintenance
Tags: , , , ,

Judge Name: Hughes FM
Hearing Date:
Decision Date:27/09/2012
Applicant: Ms Waldrop
Respondent: Mr Chatelet
Solicitor for the Applicant: Women’s Legal Service Victoria
Counsel for the Applicant: Mr Smith
Solicitor for the Respondent: In Person
Counsel for the Respondent: In Person
File Number: MLC 7091 of 2008
Legislation Cited: Family Law Act 1975, ss.75(3), 82(2), 82(4)
Child Support (Assessment) Act 1989, s.117(2)
Cases Cited: Gyselman and Gyselman (1992) FLC 92-279
Jurisdiction: Family Court of Australia
Parental Responsibility Outcome: Not Relevant
Residential Outcome: Not Relevant


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ORDERS

The contravention application filed by the applicant wife on 14 October 2011 is dismissed.

The application in a case filed by the applicant wife on 8 March 2012 is dismissed.

The response filed by the respondent husband on 5 April 2012 is dismissed.

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

REASONS FOR JUDGMENT

These proceedings involve four separate applications all related to the question of whether or not an order for spouse maintenance should continue, notwithstanding the re-marriage of the applicant, given the particular circumstances of the case in which both the applicant and her new husband are in receipt of disability support pensions.

The respondent husband relies on section 82(4) of the Family Law Act which provides as follows:

An order with respect to the maintenance of a party to a marriage ceases to have effect upon the re-marriage of the party unless in special circumstances a court having jurisdiction under this Act otherwise orders.

The applicant wife argued that the financial situation of her and her new husband amount to special circumstances which would warrant a continuation of the order.

Background

The applicant wife is 47 years old and the respondent husband is 44. They were married [in] 1989 and separated in May 2008. They were divorced on 21 May 2010 and have both now re-married.

The parties have seven children together. The children were born between [omitted] 1993 and [omitted] 2007 and are, therefore, aged between 19 and 5 years. All seven children remained living with the husband following separation. Allegations that the wife had physically, verbally and emotionally abused the children were substantiated during the trial in the Family Court of Australia which ended with a judgment delivered by Brown J on 25 August 2009.

Because of the findings of abuse and the stated desire by the older children not to have anything to do with their mother, orders were made for the three eldest children to spend time and communicate with their mother as agreed between each of them and her. Provision was made for the four younger children to spend time with their mother for various periods during the day on 6 days each week, to be fully supervised for the first 6 months following the orders. For the second 6 months full supervision was not required but another person was to be in substantial attendance. From 12 months after the orders, the time for the four younger children to spend with their mother was to be as agreed between the parties.

It appears there was no property of substance to divide. A family business had failed and, at the time of separation, the family was living in rental accommodation.

The wife sought and obtained an order for spouse maintenance. She had filed a financial statement on 13 July 2009 in which she declared her total weekly income as $320.00 per week or $16,640 per annum. This was comprised of $220.00 per week from her work as a [omitted], supplemented by a Centrelink Newstart allowance of $100.00 per week. She declared total weekly expenditure of $1,018.00. It is not clear from the judgment whether the wife explained how she met the shortfall. Her Honour commented that while there might be an argument “about a dollar here or there in the expenses claimed by the [wife]”, she was satisfied there was a significant shortfall and a need for financial support for her.

The husband was employed at the time of the 2009 trial as an [omitted] with a salary package of $191,000.00 per annum. He was also eligible for a bonus of up to 25% of his base salary. In his financial statement filed on 20 July 2009 he had declared an excess of expenditure over income of $460.00 per week. Again, it is not clear from the judgment how the shortfall was met. According to the judgment he conceded during cross-examination that he “keeps his head above water” on a fortnightly basis. At that time the husband was paying a total of $911.00 per week in child minding fees of which $763.00 per week was spent on a nanny to help care for the children given his need to continue working full-time. He was also determined to keep the children at their current schools to avoid further disruption to them. He had outstanding credit card debts and school fees totalling $9,000.00 plus extensive legal and associated fees to pay. Her Honour noted that the financial demands of raising seven children was likely to increase as the children got older but also noted her impression of the husband as an astute financial manager who would budget in an orderly manner within the constraints of the available income.

Her Honour found that the $300.00 per week spouse maintenance sought by the wife was justified but that the husband did not have the capacity to pay more than $75.00 per week. The orders made on 25 August 2009 required the husband to pay to the wife the sum of $75.00 per week in monthly instalments of $325.00, varied each year in line with the consumer price index for Melbourne. The orders were expressed to apply for 10 years or until the wife obtained full-time employment which she maintained for a month or obtained any form of employment maintained for a month and in relation to which she was paid no less than $750.00 per week (adjusted in line with CPI movements).

It is common ground that the husband paid spouse maintenance in accordance with the orders until January 2012.

The current circumstances of each party

The applicant wife re-married [in] 2010. She is in receipt of a disability support pension. She declared in her financial statement filed on 8 March 2012 that her average weekly income is $317.00 which is comprised of $260.00 disability pension and a mobility allowance of $57.00.

The wife’s new husband is aged 46 years. He swore an affidavit in the current proceedings in which he deposed to suffering from various medical problems for which he, too, has been in receipt of a disability support pension since July 2001. He now receives a carer supplement for his care of the wife. His total income per week is $337.00.

The applicant and her new husband both deposed that they have a joint account from which they pay their living expenses. The major item of expenditure is rent of $256.90 per fortnight in relation to which they each pay half. The wife’s share of the rent is $64.23 per week. This is a significant reduction on the private rental of $330.00 per week she was paying at the time of the 2009 proceedings.

According to the financial statement filed by the wife on 8 March 2012, she has a significant excess of weekly expenditure over income. She declared personal expenditure of $811.00 per week which exceeds her income by $494.00 each week. She did not say how she meets the shortfall but did declare a number of debts including to Centrelink and to an organisation called [omitted] to whom she owes $25,252.00.

At Part N of her financial statement the wife declared expenses not only for herself but also for her new husband and for the children. She declared that she spent $98.00 per week on food and pharmaceuticals for her new husband. She did not explain why she needs to do that when he receives slightly more than she does each week and is also paid a carer’s supplement for his care of her. She declared expenditure of $68.00 per week for the children. The respondent asserted that the applicant, in fact, spends very little time with the children, has never spent as much time as provided by the orders and that there have been significant periods since 2009 during which she has spent no time at all with them. However, he conceded that, shortly before the hearing, the time between the children and their mother had increased.

The respondent husband re-married in 2011. His new wife has two children from a previous marriage who live with her and spend three nights per fortnight and some school holiday time with their father. Their father pays child support for them. In his financial statement filed on 5 April 2012 the husband declared that his new wife has an average weekly income of $238.00. Presumably this is entirely or substantially comprised of child support given she does not work outside the home.

The respondent and his new wife also have a child together, born [in] 2012. This means the husband now has responsibility for the financial support of twelve people: himself and his new wife; the seven children he has with the applicant; his new baby; and his two step-children, although the costs of supporting his step children are offset at least to some extent by the child support received by his wife for them.

As a result of the respondent’s new wife being available and prepared to care full-time for all of the children, the husband no longer has to employ a nanny. At the time of the 2009 trial he was spending $911.00 per week on childcare, $763.00 of which was for the nanny. His declared childcare costs have now fallen to $38.00 per week. When that saving became available, he and his new wife decided to buy a house, which they did in December 2011. I assume the house is relatively modest because, although it accommodates twelve people, according to the husband’s financial statement filed on 5 April 2012, it has a value of $310,000.00. It is subject to a mortgage in the sum of $278,538.00. The current mortgage payment is $865.00 per week, a significant increase on the $420.00 per week the husband was spending on rent at the time of the trial in July 2009.

At the time of the 2009 proceedings, Brown J found that the respondent’s income was $191,000 per annum. In his financial statement filed in the current proceedings on 5 April 2012, the husband declared an average weekly income of $4,093.00 or $212,836.00 per annum. Although this is an increase of almost $22,000 per annum, the husband said that the increase in salary came at the expense of security. He said he left his secure, permanent job and commenced working as a [omitted] in the same industry on fixed term contracts for a higher hourly rate in order to earn more money.

The respondent said that, as predicted by Brown J, the costs of the children had increased significantly as they got older. He has continued to pay for the private school fees of the children. In his financial statement of 5 April 2012, the respondent declared that Mr C (who I assume is his father) assists him by paying $144.00 per week towards the children’s school fees.

In his April 2012 financial statement the husband declared an excess of expenditure over income of $274.00 per week. The shortfall can be accounted for by the income received by his wife and by the school fees paid on his behalf.

Events leading to the current proceedings

On 28 September 2011 the husband notified the wife by email that he had received a letter from the Child Support Agency stating the wife had earned an excess of $25,000.00 for the 2009/10 financial year. In the email he criticised the applicant for failing to advise him of her employment and for her failure to contribute to the costs of supporting the parties’ children from her income. He then ceased making the payments of spouse maintenance. It is common ground that he had met all of his obligations under the orders until then.

By return email on the same day the wife advised the husband that the Child Support Agency document was incorrect and had since been corrected. During the hearing of the current proceedings the husband said that he had never received any evidence that the document was incorrect. The husband also received from the wife a draft enforcement warrant which sought the sale of the husband’s vehicle. He said he became very concerned about how he would transport the children if the vehicle was seized. Accordingly, he reinstated the payments of the spouse maintenance and paid the arrears.

The husband stopped making the spouse maintenance payments altogether in January 2012, relying on the fact that the applicant had re-married. It is not clear on the evidence whether he had not previously realised the applicant had re-married or whether he had only then become aware of the provisions of section 82(4) of the Family Law Act. In any event, he advised the wife that he believed his obligation to pay the spouse maintenance ceased upon her re-marriage on 20 November 2010 and sought a repayment of the amounts paid by him since that date.

The current proceedings

The proceedings began with a contravention application filed by the wife on 14 October 2011 alleging the husband had breached the orders of 25 August 2009 by failing to make the spouse maintenance payments. The applicant was self represented at that time. She asserted in her affidavit filed on 25 November 2011 that she had also filed an application for enforcement but, although the respondent said he had received an unsigned copy, no such application had been filed by the date of the hearing on 4 May 2012.

The applicant obtained legal representation and, on 8 March 2012, filed an application in a case seeking orders for the spouse maintenance order of 25 August 2009 to continue, notwithstanding her marriage.

The respondent husband remained self represented throughout the proceedings. On 5 April 2012 he filed a response in which he sought the following:

a discharge of the spouse maintenance order of 25 August 2009;

a dismissal of the wife’s application in a case filed on 8 March 2012;

an order restraining the wife from making any further spouse maintenance claims against him;

an order for repayment of all spouse maintenance paid since the wife’s re-marriage in November 2010;

a psychiatric assessment of the wife to establish whether or not she is suffering from Munchausen Syndrome which, he believes, affects her capacity to meet her parental responsibilities;

a penalty to be imposed on the wife for breaching the parenting orders of 25 August 2009 (presumably by failing to spend the time with the children provided in the orders);

a restraint on the wife making further complaints about him to Victoria Police without leave of the Court; and

a restraint on the wife denigrating him to any other person including the children and her new husband.

On 27 April 2012 the respondent filed a further application in which he sought that the applicant be dealt with for contempt of Court. He alleged in support of that application that she continued to abuse the family law process by making complaints about him to Victoria Police which were actively misleading and in which she failed to disclose pertinent facts, such as the existing orders. He alleged the complaints caused maximum disruption but were typically resolved with an apology to him by the police when they became aware of the true situation.

Counsel for the wife sought that the proceedings be dealt with by way of submissions only. The husband was content with that course of action. Consequently, there was no testing of the sworn evidence relied on by each party.

I will deal firstly with the major issue of whether or not the spouse maintenance order should continue before returning to the various other applications.

Should the spouse maintenance order continue despite the re-marriage of the wife?

Counsel for the wife relied on two main arguments. The first was that the orders of 25 August 2009 provided an exhaustive list of the factors which could or would bring the spouse maintenance order to an end, regardless of any provisions of the Family Law Act. According to this argument, the spouse maintenance obligation will continue until the expiration of a period of 10 years unless the wife has maintained full-time employment for at least a month or has maintained any form of employment for at least a month for which she was paid the equivalent of $750.00 per week. I am not at all persuaded by that argument. Followed to its logical conclusion, it would mean the husband was required to keep making the payments regardless of the wife’s circumstances upon her re-marriage, and even if she had married a multi-millionaire. As a matter of logic, it would also mean the husband was required to keep paying even if the wife died before one of the three conditions was satisfied as section 82(2), which provides that spouse maintenance orders cease to have effect upon the death of a party, would also not apply. There is nothing at all in the orders which suggests that her Honour intended to exclude the operation of the Act. I reject the argument, noting that even the wife’s counsel conceded it was not strong.

The second argument was far more persuasive. It was that the circumstances of the wife’s re-marriage are so out of the ordinary that they amount to “special circumstances” within the meaning of s.82(4) of the Act and warrant a continuation of the spouse maintenance order.

There is a dearth of case law on the meaning of “special circumstances” for the purpose of s.82(4). There is, however, a considerable body of judicial discussion about the meaning of the same term in the context of an application for a departure from the administrative assessment of child support pursuant to s.117(2) of the Child Support (Assessment) Act 1989. In Gyselman and Gyselman the Full Court of the Family Court said the following about the term:

Section 117(2) sets out the grounds for departure from administrative assessment. Each of those grounds is prefaced by the words “in the special circumstances of the case”. Whilst it is not possible to define with precision that term, as a generality is intended to emphasize that the facts of the case must establish something which is special or out of the ordinary. That is, the intention of the Legislature is that the Court will not interfere with the administrative formula result in the ordinary run of cases. In Savery’s case (p. 77,897), Kay J, adopting the view in Philippe and Philippe (1978) FLC ¶90-433 at p. 77,202 in a different context, said that “special circumstances” were “facts peculiar to the particular case which set it apart from other cases”. The approach to the interpretation of the particular grounds in s 117(2) must be guided by that qualification.

I accept the submission of counsel for the wife that, in the context of section 82(4) of the Family Law Act, the term “special circumstances” should also be taken to mean something out of the ordinary or which set it apart from other cases. It is hard to imagine what special circumstances were envisaged by the legislators as justifying the continuation of a spouse maintenance order after re-marriage, other than that the re-marriage did not improve the financial circumstances of the recipient which warranted the making of the original order. It is also hard to think of a situation more likely to fit that criterion than the current case in which the applicant has married someone on a disability support pension and who is, therefore, just as impecunious as her. Accordingly, I have no trouble finding that the wife’s circumstances amount to “special circumstances” within the meaning of s.82(4).

In this case, however, the special circumstances do not relate only to the applicant wife. The respondent husband also has his own special circumstances. Although he is earning a very healthy income which has increased by almost $22,000 since the original order was made, he is now supporting twelve people on that income, four more than at the time the spouse maintenance order was made. The costs in support of those twelve people are extraordinary. Some of the costs were known or anticipated at the time of the original order. For instance, it was contemplated that the costs of the parties’ seven children would increase over time and it was known that the husband would have the costs of ongoing counselling and therapy for the children. However, the need to accommodate, feed and clothe an extra four people in less than three years was not anticipated. I accept the husband’s evidence that he is unable to meet the expenditure required to support his family without the contribution to the children’s school fees provided by Mr C.

The applicant clearly has a vastly inferior income to that of the respondent. Subsection 75(3) requires any court determining spouse maintenance proceedings to disregard any entitlement the prospective payee has to any income tested pension, allowance or benefit. Assuming that proscription applies in this case, the applicant can be taken to have, effectively, no income. Although her new husband is in the same position, the legislation does not require me to disregard his pension. It appears that the applicant’s circumstances have improved to a small extent as a result of her marriage. The money coming into the wife’s household has either risen from nil to $337 per week (if her income is disregarded) or doubled, albeit at a very low level (if her income is taken into account). Although there are increased costs in support of two people, there are also some economies of scale. The wife’s major item of expenditure at the time of the 2009 proceeding was her accommodation. That expense is now roughly one fifth of what it was at the time of the original order.

The wife deposed to having such significant debts that she is contemplating bankruptcy. She claimed to be paying off debts, including credit card debts, from the marriage but I do not accept that. The claim was strongly denied by the husband who said there were no outstanding debts at the time of separation. I note that no mention of the wife paying such debts was made by Brown J in her 2009 judgement. The husband argued that the wife has always been a poor manager of money and that a continuation of the spouse maintenance order is not likely to relieve her debt situation. I have no way of assessing the veracity of that argument and disregard it in any event as not being a proper matter to take into account for the purpose of the current proceedings.

At the end of the day, although there are special circumstances pertaining to the wife, there are also special circumstances pertaining to the husband. His global financial position has deteriorated to some degree since the orders were made. The small increase in his income is outweighed by the increase in his financial obligations which he is only able to meet because of the contribution to the payment of school fees by a third party.

The onus is on the wife to satisfy the Court that the particular circumstances of the case justify the continuation of the spouse maintenance order. That onus has not been discharged notwithstanding that she had a strong prima facie case. By operation of section 82(4), therefore, the order ceased to have effect upon the re-marriage of the wife on 20 November 2010. Both the contravention application filed on 14 October 2011 and the application in a case filed by the applicant on 8 March 2012 will, accordingly, be dismissed.

During submissions, counsel for the wife argued that if the applicant was unsuccessful in achieving a continuation of the spouse maintenance order at the existing level, the Court should consider varying the amount payable, rather than discharging it altogether. However, that would require a finding that the special circumstances justified a continuation of the order at some level. For the reasons already stated I am not persuaded the order should continue or that the husband has the capacity to meet any spouse maintenance order, given the extent of his commitments in support of his family.

The remaining applications

The respondent said during oral submission that he did not wish to pursue his application for recovery of any overpayment of spouse maintenance so that application will be dismissed.

I was not addressed at all during the proceedings by either party about the applications by the husband for the following:

a restraint on the wife making any further spouse maintenance application;

a psychiatric assessment of the wife; and

a penalty for the wife contravening her parental responsibilities.

Accordingly, none of those orders will be made.

The husband also sought an order that the wife not denigrate him to any third party, including her new husband or the children. There is already a non-denigration order in place. Order 17 of the orders of 25 August 2009 provides that each party is restrained from denigrating the other or allowing any other person to do so in the presence or hearing of the children. The order does not preclude the applicant denigrating the respondent to her new husband. I was not addressed about that matter but it seems to me that the applicant may well want to express negative sentiments to her current husband about her former husband from time to time and, provided the children are not exposed to it, she should not be restrained by a court from doing so.

The husband sought an order that the wife be restrained from making further representations or complaints to Victoria Police without leave of the Court. I do not intend to make that order because the problem was addressed through a resolution of the husband’s contempt application.

The contempt application was an attempt by the husband to deal with what he alleged was an abuse of process by the wife. He alleged the wife had made a series of complaints to the police which were factually incorrect and that she had accused him of breaching an intervention order by communicating with her by email. The 2009 family law orders require a level of communication between the parties in order to reach agreement about the arrangements for the children and to notify each other in the event of illness or injury suffered by any of the children. The orders require each party to keep the other advised of their address and telephone number. Although not explicitly stated in the orders, it appears the parties have interpreted the orders as permitting text messaging between them but not emails. When the husband sent an email to the wife about the spouse maintenance issue (and notwithstanding her response to him by email), she complained to the police that the husband had breached the intervention order which only permitted communication in accordance with any family law order.

At the end of the hearing on 4 May 2012 I ordered that the parties may communicate with each other by text message or email for the purpose of:

fulfilling any obligation under any family law order;

to communicate in relation to the execution of any family law orders; and

to communicate in relation to matters concerning the children.

Given the intervention order provided an exception to the relevant restraints if the respondent was acting in accordance with any family law order, he agreed this would resolve the problem. The order was made on 4 May 2012 with his consent and was not opposed by the applicant. In those circumstances the respondent withdrew his application for contempt that day.

This means that all extant applications can now be dismissed.

I certify that the precedingforty-nine (49) paragraphs are a true copy of the reasons for judgment of Hughes FM

Date: 27 September 2012


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