Spousal Maintenance – a recent case

Spousal Maintenance

Sauveterre & Warwick [2015] FamCA 1076 (3 December 2015)

Last Updated: 15 December 2015

FAMILY COURT OF AUSTRALIA

REPRESENTATION

ORDERS

(1) That pursuant to section 74 of the Family Law Act 1975 (Cth) the husband is to pay to the wife, or as she may direct from time to time in writing, the sum of $445 per week in spousal maintenance.
(2) The wife’s application for payment by the husband of the wife’s mobile phone account, expenses related to the Japanese motor vehicle and private health insurance is dismissed.

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

FILE NUMBER: SYC 3539 of 2015

Applicant

And

Respondent

REASONS FOR JUDGMENT

INTRODUCTION

1. This matter concerns an application for interim spousal maintenance, pending hearing of an application for final property and spousal maintenance orders. The husband opposes the application.
2. The application has been made in the context of consent orders made on 24 August 2015 which provided for the parties to each withdraw the sum of $50 000 from a controlled monies account which holds the net proceeds of the sale of the parties’ former matrimonial home. The orders specified that the respective payments were to be “characterised at trial.”
3. The orders now sought by the wife are:

1. That pursuant to section 74 of the Family Law Act 1975 the husband pay to the wife or as she may direct from time to time, the sum of $1205.00 per week in spousal maintenance.

2. That in addition to the payment in Order 1 above the husband pay as and when they fall due the following expenses of the wife:

(a) The wife’s mobile phone account.

(b) Registration, insurance, lease payments, and all maintenance/service expenses in relation to the … motor vehicle registration number ….

(c) Private health insurance for the wife and the children of the relationship.

4. In opposing the wife’s application for interim spousal maintenance, counsel for the husband argued that the wife is an artist who is of “world renown” and has a substantial earning capacity. Counsel for the wife, on the other hand, argued that the wife does not have the fame or expertise as asserted by the husband and that the wife’s capacity as an artist, and an occasional lecturer, were and remain “de minimus.”
5. The Court is of the view that the wife has established a need for spousal maintenance. The Court has had difficulty in identifying the full extent of the husband’s capacity to pay such spousal maintenance as a result of complexities concerning the structure and operation of a trust of which he is the sole trustee and a beneficiary.
6. In the circumstances an order will be been made requiring the husband to pay spousal maintenance to the extent of his reasonable ability to do so, having regard to the financial resources that are available to him.

BACKGROUND

7. The husband was born in B Town, Tasmania, in 1961. The wife is a Native American Indian who was born in City D, Country R, in 1965.
8. The parties were married in 1992. They separated in July 2012 but continued to live separated under the same roof.
9. The parties have three children – E who is 12 years old, F who is 20 years old and G who is 23 years old. E is a student at H School and F is a full-time university student. G lives in England and is financially independent from her parents.
10. On 10 December 2014 the parties sold their property at I Street, Suburb J, and the parties moved into separate rental accommodation.
11. The husband is currently employed as the Chief Financial Officer of K Pty Ltd, which provides emergency management services and training.
12. The wife is an artist. She is currently finishing a Doctorate through University L.
13. From the sale of the proceeds of the I Street property the wife and the husband each agreed that they would receive the sum of $20 000. These payments were not the subject of any orders. The balance of the sale proceeds were placed into the controlled monies account referred to above. There was some dispute between the parties regarding the amount in the controlled monies account. However, it appears that as at 27 August 2015 the balance is agreed as being between $1 255 309 and $1 350 950.
14. As will be discussed, in presenting their arguments, both parties focused upon the content of each of the parties’ respective Financial Statements. Additional documentation was also tendered into evidence relating to the wife’s income and also in respect to the financial affairs of the M Trust (hereafter “the Trust”), a trust of which the husband is the sole trustee and a beneficiary.
15. The Trust was originally established in 2009 for the purpose of the husband undertaking consultancy work for N Ltd. The beneficiaries of the Trust, in addition to the husband, are the wife and the parties’ three children.
16. The Financial Statement of the Trust for the year ended 30 June 2014^[1] notes that the Trustee has “absolute discretion” in respect to distributions from the Trust to the beneficiaries.
17. The husband asserted that, as an employee of K Pty Ltd, he no longer performs any consultancy work and the Trust is utilised as a vehicle through which various shareholdings are held.
18. Until December 2014 the Trust claimed certain expenses in respect to the husband’s income protection, motor vehicle expenses and insurance, computer expenses and telephone accounts. Those expenses are now characterised by the husband as his personal expenses.^[2]
19. In his Financial Statement filed 20 July 2015 the husband provided details regarding the income, shareholdings and assets of the Trust as follows:^[3]
    • Investment income
      <li “=””>- Dividends – $104.
20. Shareholdings
    <li “=””>- National Australia Bank (“NAB”) – “there is a reinvestment plan whereby new shares are received in lieu of a dividend.”

<li “=””>- N Ltd – “[N] does not pay dividends.”<li “=””>- [O Ltd] – “This company came into existence as a result of the merger from BHP in or about May 2015. Today, no dividend has been declared or paid.”<li “=””>- Westpac Bank (“Westpac”) – “there is a reinvestment plan whereby new shares are received in lieu of a dividend.”

21. Assets
    <li “=””>- Comsec Share Trading Account – $121 681.

<li “=””>- IG Markets (“Contracts for Difference” (CFD) trading) – $2.<li “=””>- Japanese motor vehicle – $20 000.<li “=””>- Vantage FX CFD Trading – $10.

20. The Trust Financial Statement for the financial year ended 30 June 2014 shows the total assets of the Trust as $132 440 and total liabilities as $222 105. The net assets are -$89 664.
21. At this stage of the proceedings there is little information before the Court regarding the structure and operation of the Trust. As a result, in these interim proceedings, it is not possible to make a precise calculation as to the extent to which the Trust is a financial resource for the husband. However, the following evidence is relevant in considering whether the Trust is such a financial resource:
    • At paragraphs 82 and 83 of the husband’s affidavit sworn 17 July 2015 the husband states:

In or about June 2013, following discussions with me concerning the matter of interest on the $300,000 [Mr P] [the husband’s brother] had loaned to [Ms Sauveterre] and I, [Mr P] caused his family trust, [Q Trust], to note a distribution of $231,851 to the [M Trust].

The asset thereby created for the benefit of the M Trust was offset against a related liability of the [M Trust] in the amount of $276,307. The debt which the Trust owed [Ms Sauveterre] and me arose when I incurred the foreign currency trading losses in or about September 2011, the effect of which, was, in my view, to create an indebtedness on the part of the Trust to us. Both the asset and the liability is accounted for by me within the Loans – Beneficiaries ([Mr Warwick]) line within the balance sheet of the [M Trust].

• The Financial Statement of the Trust for the financial year ended 30 June 2014 refers, in Note 5, to “Borrowings” with a current loan specified as “Loan from Beneficiary – Mr W” and reports the following amounts:
  • opening balance 2013 – $180 993
    • less repayments 2013 – $204 651
    • new borrowings 2013 – $77 063
    • closing balance 2013 – $53 405
  • opening balance 2014 – $53 405
    • less repayments 2014 – $25 063
    • closing balance 2014 – $28 342
• The Balance Sheet contained in the Financial Statement to the Trust for the financial year ended 30 June 2014 records “Loans – beneficiaries (Mr W)” as a liability of the Trust in the sum of $28 342. This appears to be the balance which remains after a payment to “Beneficiary (Mr W)” in the sum of $25 063.

22. It is not clear, from the records that have been provided to the Court, what transpired in respect to that item described as payment to beneficiary (Mr W) in the sum of $25 063. As there are only two beneficiaries with the initials “Mr W”, having regard to paragraphs 82 and 83 of the husband’s affidavit (referred to above), it is assumed that the reference in the Financial Statements of the Trust to the beneficiary “Mr W” is a reference to the husband rather than the 12 year old child, E.
23. It appears that the payment of the sum of $25 063 to the beneficiary “Mr W” was made in circumstances where the Financial Statement for the Trust, for the financial year ended 30 June 2013, reported negative net assets of -$70 148 and negative equity in the same amount. The same Financial Statement also reports “tax losses carried forward” as $65 381.

ISSUES

24. Both parties acknowledged that the issues to be determined are:
    <li “=””>(i). To what extent is the wife unable to support herself?

<li “=””>(ii). What are the wife’s reasonable needs?<li “=””>(iii). What capacity does the husband have to meet a spousal maintenance order, if such an order was made?

(iv). If (i) to (iii) favour an order for spousal maintenance being made, what order is reasonable having regard to sections 75(2) of the Family Law Act 1975 (Cth) (“the Act”)?^[4]

THE LAW

25. Section 74(1) of the Act empowers the Court to “make such order as it considers proper for the provision of maintenance” in accordance with Part VIII of the Act.
26. Section 72(1) relevantly provides:

72 Right of spouse to maintenance

(1) A party to a marriage is liable to maintain the other party, to the extent that the firstmentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:

(a) by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;

(b) by reason of age or physical or mental incapacity for appropriate gainful employment; or

(c) for any other adequate reason;

having regard to any relevant matter referred to in subsection 75(2).

27. In McCrossen & McCrossen [2006] FamCA 868; (2006) FLC 93-283, the Full Court, after referring to a number of earlier authorities, said that the question as to whether or not a person is able to support themselves “adequately” is:

not to be determined upon a “subsistence level” but upon consideration of whether the applicant can support himself or herself “adequately” importing a standard of living reasonable in the circumstances.^[5]
(References omitted)

28. The Full Court, citing Mitchell & Mitchell (1995) FLC 92-601, also observed that:

It is not necessary for an applicant for maintenance to use up all of his or her assets and capital in order to satisfy the requirements that he or she is unable to support himself or herself “adequately”.^[6]

29. Once the applicant crosses the evidentiary threshold of establishing the requisite financial need, it is necessary to then establish that the respondent has a capacity to pay.^[7]

30. The evidentiary requirements in respect to interim applications for spousal maintenance were considered by the Full Court in Redman & Redman.^[8] In that case, the Full Court said that it was appropriate to maintain some flexibility in approach.^[9] Consistent with Redman, in Drysdale & Drysdale^[10] Coleman J exercising the appellate jurisdiction of the Full Court said:

It is the nature of an interim spousal maintenance order that, as here, it is made after a circumscribed hearing, in reliance upon evidence which is incomplete and/or unable to be fully tested. Whilst different to urgent spousal maintenance pursuant to s 77 of the Act, orders for interim maintenance are as their title implies. The Court hearing and determining financial proceedings between the parties on a final basis, as clearly will occur in this case in the absence of any intervening settlement, has abundant power to accommodate within its final orders, whether by way of settlement of property or spousal maintenance, any anomalies which full agitation of disputed issues of fact may reveal to have resulted from an earlier interim spousal maintenance order.

31. In an application for spousal maintenance it is necessary to distinguish between the expenses of the spouse seeking an order for spousal maintenance and the expenses of the children of the marriage (or relationship).^[11]
32. Trust assets may be a financial resource for the purpose of satisfying a spousal maintenance order, where a party has the “capacity to control and deal with the Trust property and to borrow from it”.^[12]
33. In determining the “reasonable ability” of a party to satisfy an order for interim spousal maintenance the Court is not confined to considering only that party’s income, but rather:

Once a party, …establishes an entitlement to interim spousal maintenance, and such entitlement is quantified in accordance with that spouse’s reasonable needs, an order may be made notwithstanding that the liable spouse could only satisfy the order out of capital or borrowings against capital assets.^[13]

CONSIDERATION

Initial threshold – responsibility for the care and control of a child who has not attained the age of 18 years

34. The husband acknowledges that the parties jointly share the care of their son E who is now aged 12.
35. Accordingly the husband conceded that, subject to the wife establishing an inability to maintain herself adequately and the reasonable ability of the husband to do so, the wife had satisfied the first threshold set out in section 72(1)(a) of the Act.

To what extent is the wife unable to support herself?

36. Counsel for the wife submitted that the best indication of the wife’s inability to support herself is reflected in her income taxation returns, which were prepared by the husband, for the financial years ended 30 June 2012 and 30 June 2014. Counsel for the wife advised that no taxation return has been prepared on behalf of the wife for the financial year ended 30 June 2013.
37. The wife’s taxation return for the financial year ended 30 June 2012^[14] shows a gross income of $1023.00. The wife’s taxation return for the financial year ended 30 June 2014 shows a gross income of $5798.00.^[15]
38. Counsel for the wife acknowledged that the wife has received additional income in the period since 31 July 2014 from a number of grants and scholarships, including one related to her indigenous background. However, it was submitted that that potential income stream is precarious.
39. In that respect it was argued that the casual lecturing and teaching positions held by the wife are short term only and future engagements cannot be guaranteed. It was further asserted that the scholarship may not continue, beyond the end of this year, as a result of the wife taking longer than expected to complete her doctorate.
40. An issue of significant controversy between the parties was a contract entered into by the wife and City D (Country R) dated 19 August 2015 for the wife to provide an artwork to be displayed by City D (hereafter “the City D contract”). The City D contract, which is Exhibit 10 in the proceedings, specifies a completion date of 31 October 2015 and a total contract price of $30 000.
41. It is apparent from the City D contract that the amount of $30 000 is a gross figure and, from that amount, the wife is responsible for paying all expenses associated with the completion of the artwork, including her airfares, accommodation, the cost of a contractor to install the artwork, and the costs of a photographer to take photographs of the artwork once it has been installed.
42. When pressed as to whether the wife was in a position to quantify those deductions, counsel for the wife explained that the wife had only recently returned from Country R and, with the occurrence of a recent public holiday, was not in a position to present detailed information regarding those expenses to the Court at the interim hearing. As will be discussed this presents a considerable difficulty for the wife who, as the applicant, carries the onus of satisfying the Court that the grounds exist for the making of a spousal maintenance order.
43. In an endeavour to overcome this difficulty, the wife sought to rely on the contents of a letter from Jo-Anna FS Moy, the solicitors for the wife, addressed to Clive Mills and Associates, the solicitors for the husband, dated 11 September 2015.^[16] The letter relevantly states:

From the monies referred to in the contract my client must pay for her airfares, accommodation, food and materials. In addition my client will pay for photographing the works to show as part of her body of works. My client understands that she may make as much as $3 to 5000 from this grant.

44. The tender of the letter regarding the deductions was not received into evidence for the purpose of proving the expenses incurred by the wife in respect to her performance of the City D contract.
45. In both written and oral submissions, counsel for the husband argued that the wife is not in a position to establish that she is unable to support herself because she failed to make full and frank disclosure as required by the Family Law Rules 2004 (Cth) (“the Rules”). At paragraph 15 of the husband’s outline of submissions, after referring to relevant case law, it was submitted that “the Court should find that the wife has not discharged her duty of financial disclosure” with the consequence that the wife has not presented evidence upon which the Court can rely for the purpose of determining the wife’s ability to support herself.
46. While there are inevitably evidentiary difficulties in interim proceedings, that does not excuse an applicant seeking an order for financial relief from the obligation of providing to the Court sufficient evidence to justify the Court granting the relief sought by that party. In that context, in Acton & Burton,^[17] Hogan J said:

The obvious limitations inherent in interim proceedings do not relieve the party seeking relief from the obligation of establishing the necessary prerequisites for the grant of the relief sought. The Applicant, therefore, must still prove, to the requisite standard, those matters fundamental to the successful prosecution of her claim.

47. As a result of the wife failing to provide disclosure of the deductions from the amount of $30 000 payable pursuant to the City D contract, the husband’s case in that respect will be taken at its highest. The gross sum specified in the City D contract will therefore be included in the calculation of the wife’s earnings.
48. At the hearing, counsel for the husband submitted that, in addition to the full value of the City D contract, the wife’s income should be determined as including:
    • Child support in respect to the period from 31 March 2015 to 2 September 2015 – $6865.
    • Workshop income in respect to the period from 27 February 2015 to 18 June 2015 – 13 073.^[18]
    • The scholarship in respect to the period from 25 September 2014 to 25 August 2015 – $20 371.
    • Art School in respect to the period from 25 March 2015 to 26 August 2015 – $1771.
    • Cash deposits made in respect to the period from 17 December 2013 to 29 July 2015 – $9917.
49. As correctly submitted by counsel for the husband, it is not appropriate for the Court to speculate on possible expenses incurred by the wife in fulfilling the City D contract with a view of preparing a balance sheet detailing income and expenses in respect to the wife fulfilling her obligations under that contract.
50. Further, counsel for the husband argued that the amounts recorded in the wife’s bank accounts as cash receipts should, in the absence of particulars of the original source of those funds, be treated as income. Counsel for the wife, on the other hand, argued that those cash amounts were transferred from funds held in a City D Bank account and should not be treated as income. In these interim proceedings, it is not possible to resolve the factual controversy relating to the original source of those funds. However, in so far as those funds are considered, the calculation of the time span of the wife’s income should include the first date that those cash payments were received by the wife.
51. While the cash deposits and the full value of the City D contract will be included in the calculation of amounts available to the wife to support herself, the calculation of the average weekly income will include the period from when the cash deposits were initially received, being on 17 December 2013, to when monies were finally payable pursuant to the City D contract which is 30 October 2015.
52. As noted, child support is not to be included in the income of the wife as it relates to expenditure incurred in respect to the parties’ 12 year old son.^[19]
53. Accordingly, the income of the wife is calculated as follows:
    • Workshop – $13 073.
    • The scholarship – $20 371.
    • Art School – $1771.
    • Cash deposits – $9917.

Total – $45 132.

54. To that subtotal will be added the City D contract of $30 000. The total amount received by the wife in respect to the period from 17 December 2013 to 30 October 2015 is therefore calculated to be the sum of $75 132. Applying the divisor of 98 weeks, being the period from 17 December 2013 until 30 October 2015, the average weekly amount received by the wife is therefore $767.

What are the wife’s reasonable needs?

55. The wife’s Financial Statement filed 24 August 2015 claimed that her average weekly expenses were $812 per week for herself and for her two children – E, who is currently 12 years of age and Mr F, who is currently 20 years of age and a full-time university student.
56. In her 24 August Financial Statement, the wife claimed her total weekly expenditure of $1916 as being:
    • rent of $1095;
    • minimum credit card payment of $9; and
    • weekly expenditure (for herself and the two children) of $812.
57. The husband disputed the expenses claimed by the wife on the basis that the wife has not adequately explained why some of her expenses had increased in her Financial Statement filed 24 August 2015 since filing her previous Financial Statement on 3 June 2015.
58. The husband contended that the wife’s average weekly expenditure should be calculated on the basis of her 3 June Financial Statement as $1647 being made up of:
    • rent of $1095;
    • minimum credit card payment $10; and
    • weekly expenditure (for herself and the two children) of $555;
59. With respect, contrary to counsel for the husband’s assertions, the wife did explain the discrepancy between her Financial Statement filed 24 August 2015 as against her Financial Statement filed 3 June 2015. In particular at paragraph 3 of her affidavit sworn 21 August 2015, the wife stated:

At the time of swearing my initial affidavit in May 2015 I had only been living at my current premises for 5 months and being responsible to the payment of my expenses and that of the children, [Mr F] and [E] for that period. I have now been paying those expenses for 8 months and have a better understand (sic) of my outgoings.

60. It is also to be noted that, in her 24 August Financial Statement, the wife reduced the amounts she claimed in respect to gas and electricity, as well as a slight reduction in the amount she claimed in respect to her minimum credit card payments. That attention to detail suggests a genuine consideration on the part of the wife to estimate her average weekly expenditure.
61. The expenses claimed by the wife are not excessive and do not include, for instance, a component for entertainment or holidays. It is of note that the weekly expenses claimed by the wife are less than those claimed by the husband.
62. Accordingly the husband’s contention that the wife’s claimed expenses should be reduced is rejected.
63. However, the expenses claimed by the wife in respect to Mr F and E as set out in Part N of her 24 August Financial Statement need to be removed from the calculation of her average weekly expenses.
64. It is therefore determined that the wife’s average weekly expenses required to support herself adequately is the sum of $1403 per week being
    • rent of $1095;
    • minimum credit card payment $9; and
    • weekly expenditure (for herself only) of $299.

Total: $1403

Calculation of financial support required by the wife

65. The Court has determined the wife’s average weekly income to be $767 and her average weekly expenses to be $1403. The wife therefore has a deficit of $636 per week between the income received by her each week and her average weekly expenses.

What capacity does the husband have to meet an order, if one was made?

66. The husband’s average weekly income is $3164 which is set out at Part D of his Financial Statement filed 20 July 2015. He sets out his average weekly expenses as $3374 at Parts G and N of that Financial Statement. The husband relies on those estimates in his Financial Statement as the basis on which he says he does not have the capacity to meet an order for spousal maintenance if one were to be made.
67. The wife, however, argued that the Court should disregard a number of expenses claimed by the husband in his Financial Statement as an ongoing expense on the basis that those expenses are either unnecessary, excessive or are expenses of the Trust and should appropriately be paid by the Trust, rather than the husband personally.

Wife’s contention of excessive or unnecessary payments by the husband

After school care

68. In circumstances where E will commence high school next year the Court accepts the wife’s submission that it is unnecessary for the husband to continue to pay for after school care as E will be able to make his own way home from school. On that basis, the Court will reduce the amount claimed by the husband in respect to the children’s activities by $10 and will disregard the amount of $21 in respect to after school care.

Medical dental and optical expenses

69. The wife objected to the husband including the amount of $53 as his expenses relating to medical, dental and optical treatment. However it is noted that, in Note 9 to his Financial Statement, the husband provides details of recent surgery at the S Hospital to remove cysts at a cost of $1466. In all the circumstances the amount claimed by the husband in respect to this item is reasonable.

Ancillary expenses

70. In the category of ancillary expenses, the wife objected to the husband claiming the amount of $7 per week for bottled water. While relatively trivial, the expense appears to be non-essential and will be disregarded in calculating the husband’s average weekly expenses.
71. Counsel for the wife initially objected to the husband’s claim in respect to private health insurance on the basis that it was submitted that the Financial Statement for the Trust for the financial year ended 30 June 2014 showed that amount as an expense of the Trust. However, on further examination, that objection appeared to be abandoned by the wife.

Expenses that the wife submits should be paid by the Trust

72. The wife noted that the taxation return lodged by the Trust for the financial year ended 30 June 2014,^[20] included the following items as expenses of the Trust:
    • Computer maintenance – $3182;
    • Depreciation – computers – $472;
    • Depreciation – motor vehicle – $10 687;
    • Insurance – $14 057;
    • Motor vehicle – insurance – $1293;
    • Motor vehicle – other expenses – $4960;
    • Motor vehicle – running cost – $5389;
    • Software – $1257;
    • Telephone internet – $1257; and
    • Telephone mobile – $1668.
73. Accordingly, counsel for the wife submitted that the Court should disregard the following expenses claimed by the husband as personal expenses:
    • Salary continuance (TPD and trauma) – $102;
    • Telephone – $27;
    • Petrol – $79;
    • Car maintenance – $11;
    • Internet connection – $20; and
    • ASIC fees, ICA membership, software subscription and PO Box fee – $31.

Consideration of wife’s objection to the inclusion of expenses previously claimed through the Trust

74. Counsel for the husband, in defending the inclusion of the above amounts which had previously been noted as expenses of the Trust, asserted that it was no longer possible for those expenses to be met by the Trust because the Trust bank account was closed in December 2014. Counsel for the husband stated that this change occurred not as a result of the parties’ separation, but because a line of credit secured over the family home was no longer available after it was sold on 10 December 2014.
75. Counsel for the husband stated that, as a result of the closure of the line of credit, the Trust bank account was also closed and those expenses were taken on by the husband as personal expenses. To confirm that fact, counsel for the husband tendered details of a Commonwealth Bank Business Card Account (account number ending 7919) as evidence of payment of the expenses.^[21] Counsel for the husband also tendered into evidence bank statements for the period 31 December 2014 to 30 June 2014 showing transfers from a Commonwealth Bank Complete Access account (account number ending 0916) to the Commonwealth Bank Business Card Account.
76. Despite evidence that those expenses were taken on by the husband as personal expenses, the wife argued that the husband had failed to make full and frank disclosure of his financial circumstances which justified his unilateral action in taking on the expenses of the Trust as his own. In that context, counsel for wife noted that paragraph 12 of Note 7 in the husband’s Financial Statement referred to the Trust receiving dividends from BHP and Credit Corp totalling an average of $104 per week. Counsel for the wife noted that there was no record as to which bank account those dividend funds were being paid into and how the funds were subsequently treated.
77. Further, paragraph 13 of Note 2 of the husband’s Financial Statement states that the Trust has shareholdings in the NAB and Westpac. The Note states that “there is a reinvestment plan whereby new shares are received in lieu of a dividend.” No further detail is provided as to the number of those shares received through that arrangement, the value of those shares or whether it is possible to convert the value of those shares to a monetary amount.
78. There are additional factors that suggest the Trust remains a financial resource which is available to the husband. That includes, for instance:
    • The husband is the sole trustee of the Trust.
    • The husband is in a position to exercise effective control over the Trust including closing and opening bank accounts, determining investments and reinvestments, taking out loans and determining the basis upon which they are to be repaid.^[22]
    • The husband has “absolute discretion” to determine distributions to beneficiaries.^[23]
    • Until December 2014 those personal expenses of the husband, which are disputed by the wife, were met by the Trust.
    • The husband has failed to disclose how the dividends received by the Trust are banked and subsequently treated.
    • The husband has failed to disclose the nature of the share dividend/re-investment schemes held with NAB and Westpac.
    • The husband has not provided evidence as to whether he has attempted to secure an alternative line of credit subsequent to the sale of the former matrimonial home.
    • The husband has failed to disclose how, in circumstances where the Trust reports a trading loss, it appeared to nonetheless partially repay a loan to the husband in the sum of $25 063.^[24]
    • Leaving aside claimed expenses, the Trust’s Financial Statement for the year ended 30 June 2014 reports a trading profit on FX Trading of $57 438 and a trading loss of $36 687. This suggests the Trust continues to engage in successful share trading activities with a return from those trading activities of $20 751 during the financial year ended 30 of June 2014.
    • The husband has not provided details of whether he has sought to extend the period of loans which are repayable by the Trust and which may be serviceable by the ongoing activities of the Trust.
79. While these matters may be clarified at final hearing, in the absence of full disclosure by the husband in respect to those matters, the Court finds that the Trust is a financial resource of the husband and that it is available to the husband to at least meet the expenses that, until December 2014, had been met by the Trust.
80. The husband has not provided a breakdown of the penultimate item in Part N of his Financial Statement in respect to ASIC fees, ICA membership, software subscription and PO Box fee. The husband notes that the Trust did not claim expenses in respect to ASIC fees for the financial year ended 30 June 2014. However, without having a breakdown, it is not possible to apportion the amount of $31 per week as claimed by the husband to exclude the ASIC fees and ICA membership.
81. As noted above, prior to December 2014, software expenses now claimed by the husband as a personal expense appeared to be met by the Trust. No explanation has been provided by the husband as to why a PO Box is required. Insufficient detail has been provided as to whether the husband will be entitled to claim a tax deduction in respect to those items and also in respect to ASIC fees and ICA membership.
82. Accordingly, while relatively insignificant, the wife’s objection to the inclusion of those items in the husband’s weekly expenses is valid and those amounts will also be disregarded in calculating the husband’s average weekly expenses.

Salary continuance

83. In respect to the item “salary continuance (total and permanent disability and trauma)”, counsel for the wife asserted that that item claimed by the husband is also an expense of the Trust. Reference was made to page 4 of the Financial Statement of the Trust for the year ended 30 June 2014 which made reference to “insurance $14 057”.^[25] Counsel for the wife, in turn, referred to Annexure “A” to the wife’s affidavit filed 24 August 2015, which indicated that the Trust has been responsible for paying regular amounts to T Life Insurance.
84. In that context, counsel for the wife also made reference to Annexure “G” to the wife’s affidavit filed 24 August 2015 which annexes an email from the husband to his financial adviser where the husband says: “I can obtain free income protection through my current employer (albeit at a lower level given my change in circumstances it is adequate for what I need).”
85. In those circumstances, the amount of $102 claimed by the husband in respect to “salary continuance (total and permanent disability and trauma)” will be disregarded in calculating the husband’s weekly expenses.

Conclusion – Expenses previously claimed by the Trust

86. In calculating the husband’s weekly expenses the Court will disregard those expenses which were, until December 2014, previously met by the Trust.

Legal expenses

87. Counsel for the husband appropriately recognised that legal expenses should not be included in the husband’s estimate of ongoing weekly expenses. Therefore the amount of $262 will be also disregarded in calculating the husband’s weekly expenses.

Calculation of husband’s weekly expenses

88. Accordingly the total amount of $655 will be disregarded in estimating the husband’s weekly expenses. The husband’s weekly expenses are therefore accepted at $2719.

Calculation of husband’s capacity to pay spousal maintenance

89. The husband has been successful in his career and currently earns $3164 per week as an employee of K Pty Ltd. In the absence of full disclosure, the Court has concluded that he also has additional financial resources available to him through the Trust.
90. However, as noted, in these interim proceedings the Trust has only been regarded as a financial resource of the husband to the extent that it has been determined that the husband is able to utilise the resources of the Trust for the purpose of meeting those expenses, identified above, that were until December 2014 paid by the Trust.
91. The calculation of the husband’s capacity to pay will be based on his income as an employee of $3164 per week. As $655 of the average weekly expenses claimed by the husband will be disregarded, that sum will be deducted from the amount claimed by the husband in his Financial Statement which, as noted, is the sum of $3374. This leaves a balance of $2719 as the husband’s reasonable weekly expenses.
92. Therefore, deducting the husband’s average weekly expenses in the sum of $2719 from his average weekly income of $3164 leaves a surplus of $445 per week.

What order would be reasonable having regard to section 75(2) of the Act?

93. Section 75 of the Act relevantly provides:

75 Matters to be taken into consideration in relation to spousal maintenance

(1) In exercising jurisdiction under section 74, the court shall take into account only the matters referred to in subsection (2).

(2) The matters to be so taken into account are:

(a) the age and state of health of each of the parties; and

(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and

(c) whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and

(d) commitments of each of the parties that are necessary to enable the party to support:

(i) himself or herself; and

(ii) a child or another person that the party has a duty to maintain; and

(e) the responsibilities of either party to support any other person; and

(f) subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:

(i) any law of the Commonwealth, of a State or Territory or of another country; or

(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;

and the rate of any such pension, allowance or benefit being paid to either party; and

(g) where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and

(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and

(ha) the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and

(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and

(k) the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and

(l) the need to protect a party who wishes to continue that party’s role as a parent; and

(m) if either party is cohabiting with another person—the financial circumstances relating to the cohabitation; and

(n) the terms of any order made or proposed to be made under section 79 in relation to:

(i) the property of the parties; or

(ii) vested bankruptcy property in relation to a bankrupt party; and

(naa) the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:

(i) a party to the marriage; or

(ii) a person who is a party to a de facto relationship with a party to the marriage; or

(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or

(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and

(na) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and

(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and

(p) the terms of any financial agreement that is binding on the parties to the marriage; and

(q) the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.

(3) In exercising its jurisdiction under section 74, a court shall disregard any entitlement of the party whose maintenance is under consideration to an income tested pension, allowance or benefit.

94. The most relevant section 75(2) factors arising from the evidence including those referred to in submissions made on behalf of the parties are as follows:

Section 75(2)(a) The age and state of health of each of the parties.

95. The wife is currently 50 years old and the husband is 54. Both parties are currently in reasonably good health.

Section 75(2)(b) The income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment.

96. I note that parties have an equal interest in the amount of approximately $1.25 million held in a controlled monies account. By agreement the parties have the capacity to draw upon those funds. They have previously done so.
97. I have referred above to the husband’s income and financial resources.
98. During the proceedings, counsel for both parties paid significant attention to the wife’s earning capacity. In that respect, counsel for the husband referred to the “Biography of [Ms Sauveterre]” contained on an internet website established by the wife.^[26] That biography refers to a number of art exhibitions, both within Australia and abroad, that the wife has participated in. The website also includes details of a number of awards and grants received by the wife.
99. Counsel for the wife, on the other hand, relied on paragraph 57 of the husband’s affidavit sworn 17 July 2015 as evidence that her employment has been irregular and short-term.
100. While the Court is without expert evidence as to the wife’s artistic skills, it is noted that the City D contract refers to the wife being invited by the City of D to participate in “a shortlist of 4 artists/artist teams to submit a project proposal” for an artwork to be displayed in that city. The wife is entitled to be proud to have been selected to provide that artwork. However, the extent to which the City D contract may translate into other opportunities remains to be seen.
101. Further, it is noted that the wife is currently completing her doctorate and that will impact upon her ability to seek full-time work while she completes those studies and her final work.

Section 75(2)(c) whether either party has the care or control of a child of the marriage who has not attained the age of 18 years and, Section 75(2)(d) the commitments of each of the parties that are necessary to enable the party to support himself or herself and a child or another person that the party has a duty to maintain

102. It is noted that the wife and husband share the care of the parties’ 12 year old son, E. The parties’ 20 year old son, Mr F, also lives with the wife.
103. For the purpose of section 75(2)(d), it is of note that, in Part N of the wife’s Financial Statement filed 24 August 2015, the wife indicates that her weekly expense in respect to E are $296. Item 31 of the husband’s Financial Statement indicates that he is paying $186 per week by way of child support for E. On the wife’s figure, this leaves a shortfall of $100 per week to be picked up by the wife. In addition that same Part N of the wife’s Financial Statement states that her weekly expenses incurred in respect to Mr F are $217 per week.

Section 75(2)(g) Where the parties have separated or divorced, a standard of living in all the circumstances must be reasonable

104. During the course of their marriage, both parties enjoyed a comfortable standard of living and, to the extent that it is reasonably practicable, both parties are entitled to maintain that standard of living.

Section 75(2)(h) The extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income

105. It is noted that the wife is in the process of completing her doctorate. Providing assistance, by way of spousal maintenance, will provide some additional financial support while the wife completes those studies. It remains to be seen, however, as to whether obtaining that significant qualification will enhance the wife’s earning capacity.

Section 75(2)(k) The duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration.

106. During their twenty-three year marriage the parties raised three children. The wife’s evidence is that she did not commence undertaking paid employment until towards the end of her relationship with the husband.^[27] This is broadly consistent with the evidence provided by the husband.^[28] It is reasonable to assume that the wife will experience challenges in maximising her earning capacity and actual earnings after an extended period out of the paid work force.

Balancing section 75(2) Considerations

107. The factors that have been referred to above favour an order being made for the wife to receive spousal maintenance. In arriving at that determination, it is noted that the husband is paying the sum of $186 per week to the wife in respect to child support for E. This fact is relevant pursuant to section 75(2)(na) of the Act. It is further noted that he is also paying approximately $51 per week to assist their elder son Mr F. This is a relevant consideration pursuant to section 75(2)(d) of the Act. These payments by the husband are, however, less than the amounts the wife claims she pays in respect to her support of E and Mr F. The amounts claimed by the wife in that respect do not appear to be excessive. Accordingly, despite those payments which are being made by the husband by way of child support and to assist Mr F, it is determined that the relevant section 75(2) factors favour an order for spousal maintenance being made to the extent that the husband is reasonably able to provide that financial support.

Application for orders in respect to payment of mobile phone, car expenses and private health insurance

108. As already noted, in addition to an order for the husband to pay spousal maintenance, the wife also seeks orders that the husband pay the following expenses of the wife, as and when they fall due:
     • mobile phone;
     • registration, insurance, lease payments and all maintenance/ service expenses in respect to the parties’ Lexus motor vehicle; and
     • private health insurance for the wife and the children.
109. The assessment of spousal maintenance has been made on the basis that these additional items have not been considered as part of the ongoing weekly expenses incurred by the wife because they are currently being met by the husband or the Trust. Further, in assessing the husband’s capacity to pay maintenance, consideration has been given to the fact that the husband is attending to payment of private health insurance through NIB in the sum of $118 per week.
110. In summary, the fact that the wife is not currently being required to meet these expenses has already been factored in to the Court’s consideration of the appropriate order for maintenance pursuant to section 74.
111. Should it be necessary, any change in that situation – such as the husband or the Trust failing to meet the payments or reducing them – could be dealt with by way of future adjustment pursuant to section 83(1)(f) of the Act.
112. Accordingly, it is unnecessary to make the ancillary orders sought by the wife.

CONCLUSION

113. For all of the above reasons the Court concludes that the wife is unable to support herself adequately and that, in order for her to be able do so requires a payment of $636 per week.
114. The husband is not reasonably able to pay that amount in spousal maintenance to the wife. However, the husband has a reasonable capacity to pay $445 per week. For the reasons set out above, the Court finds that it is proper to order the husband to pay the amount of $445 by way of spousal maintenance and makes orders accordingly.