Family Law Property Alert #3: Discretionary Trusts and the Court’s Third Party Powers
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
Can Family Law Courts require a third party trustee of a discretionary trust to cause the trust to vest, and make trust property available to husband and wife beneficiaries for their property settlement?
The appeals division of the Family Court considered that question in AC and Ors & VC and Anor [2013] FamCAFC 60 (11 April 2013), answering ‘yes and no.’
The wife commenced proceedings for property settlement against the husband, and sought orders affecting the interests of third parties who included the husband’s mother, due to her control of a discretionary trust. The discretionary trust was established by a deed of settlement dated June 1985, with a vesting date in 2064. The husband was the original guardian and appointor of the trust. The specified beneficiaries were the husband, the wife and their three adult children. The original trustee was the husband’s father, but by a deed of appointment made in August 1985 the husband substituted a corporate trustee. The husband and his father each held one of the two issued shares in, and were directors of, the corporate trustee. Read the rest of this entry »
A Father’s Promise to Son – The Sequel
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
We previously outlined the Family Law case of Hampton & Farley, in which the Family Court made good on a farmer’s promise to his son that “the farm” would be the son’s “one day”. There has since been another reported Family Court case of Daymond & Daymond, in which the wife sought a Family Law property settlement and claimed upon the husband’s share of a business, co-owned by his brother. The son of the husband and wife claimed that the husband and the son’s uncle held the business in trust for the son, due to assurances given years earlier that the son would take over the business after a period of working for them. Read the rest of this entry »
Deeds & Contracts – What’s the Difference?
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
Deeds and contracts often look the same to the lay person but there is at least one potentially critical difference between them. For a contract to be binding there must be “consideration”. That does not apply to a Deed, which is binding once signed.
This issue was one of several considered in a recent case relating to a creditor’s Statutory Demand: Samkev Investments Pty Limited [2012] NSWSC 527. In simple terms, an insurer had provided a guarantee for payments to be made by Samkev under a commercial agreement. The insurer paid out on the guarantee and then pursued Samkev for reimbursement. Historically, Samkev had entered into Deeds with other insurers for this very purpose but, in circumstances too complex to set out in this article, while a Deed had been drafted, Samkev had not actually signed it. Read the rest of this entry »
When is a Contract Ambiguous?
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
In 2006 a company developed a business plan under which it would acquire various medical practices and operate them as a single business, with a view to ultimately selling the business or listing on the stock exchange. In general terms, the ‘deal’ involved individual medical practitioners selling their practices, but taking shares in a new corporate business. They also entered contracts to provide continuing medical services to the business. A number of documents were executed to put the business model into place.
The plan was delayed because of the GFC. A further suite of documents was executed, during 2009, to defer the intended sale. These documents amended, but did not entirely replace, the 2006 documents. Read the rest of this entry »
Family Law Fee Increases
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
Most people who separate from a spouse or de facto partner do not need to commence a case in a Family Law Court, as they are able to negotiate a settlement of their parenting or property issues with the assistance of Family Lawyers, Family Dispute Resolution Practitioners and other professionals working in the Family Law system.
This means that, when someone does commence a Family Law case, that person is probably having trouble getting a reasonable response from the other party towards settlement, including due to attempts to keep them under financial pressure, perhaps forcing them to accept less property or maintenance, or where children are being placed at risk of abuse or exposure to family violence. Read the rest of this entry »
When is a Child “a Child”?
Ashleigh John is a Senior Solicitor at Mullane & Lindsay in Newcastle and specialises in Family, Relationship and Matrimonial Law
This question was recently considered by the Family Court in Brisbane in the matter of Talbot & Norman.
In the course of a short relationship between the parents, the mother fell pregnant. Upon hearing that the mother intended to have an abortion the father brought an application to the Family Court seeking to prevent the mother from terminating the pregnancy and as a consequence force the mother to carry the child to term. At the time of the hearing the mother was 13 weeks pregnant. Read the rest of this entry »
Family Law Property Alert #2: Commercial Investment, Joint Tenancy & Family Law
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
When is there a common intention between family members to sever a joint tenancy in relation to investment in a commercial property?
The appeals division of the Family Court had to consider that question in Roda and Ors & Roda and Anor [2013] FamCAFC 27 (11 March 2013) when deciding whether half of a commercial property would be included in a Family Law property pool.
In 1995, a business owner (the father), with power of attorney over the financial affairs of his son, purchased a commercial property adjacent to his business premises in the names of his son and his wife (the mother) as joint tenants. The purchase price of $552,000 was funded by finance as to the sum of $300,000 and the balance as to half each from accounts the father administered for the son and accounts in the father and mother’s names. The father initially made the purchase without the knowledge of his son or the mother.
In 2000, the mother died. In the absence of a severance of joint tenancy, the son would take sole ownership of the commercial property owned as joint tenants, by survivorship. Read the rest of this entry »
Earning Capacity After Injury
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
An issue that frequently arises in personal injury claims, is the extent of the injured person’s ‘residual earning capacity’. That is, what paid work can they now do, and earn from? Often the injured person has only a fraction of their pre injury earning capacity, because of their ongoing disabilities .
In Mead v Kerney in the NSW Court of Appeal dealt with just such an issue. Before his accident Mr Mead lived at Kandos in central western New South Wales. He worked for Telstra and travelled extensively for work. He also managed his family’s, and his own, beef cattle properties near Kandos. After his accident the Court held he had a “theoretical earning capacity of 40%” of what he earned before the accident. However it also concluded that, in practice, he would be unable to exercise that earning capacity and therefore should be compensated as if he could not earn at all. The employer appealed against that finding but was unsuccessful. Read the rest of this entry »
When is an Employer’s Policy a Contractual Term?
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
Disputes often arise, in relation to employment contracts, about whether “general policies” of the employer form part of the contract itself. For example, if the employer has a “policy” relating to payment, or redeployment, in the event of redundancy, does that policy form part of the contract such that, if the employer does not follow it, the worker is entitled to damages for breach of contract?
The Federal Court recently considered that issue in Barker v Commonwealth Bank. Amongst other arguments, Mr Barker said the CBA breached its own redeployment and redundancy policy, which was an express part of his contract and that he was entitled to damages for the breach. Read the rest of this entry »
Summary Dismissal and Long Service Leave
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
The NSW Supreme Court recently dealt with a case where an employee had been dismissed for alleged serious and wilful misconduct. The case related not to the fact of his dismissal, but whether he was entitled to pro rata long service leave (LSL). In NSW workers are generally entitled to LSL after 10 years continuous service. If employed for between 5 – 10 years, and the employer terminates for “any reason other than the workers serious and wilful misconduct”, pro rata LSL is also payable. Read the rest of this entry »
Mortgage Disputes – A Sting in the Tail
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
ANZ made two loans to the same family, secured by mortgages over two different properties. A dispute arose in relation to the second loan, which ANZ said was in default. It commenced proceedings. Part of the borrower’s defence was that ANZ had wrongfully withheld money that should have been advanced under the first loan; that this money would have prevented the second loan going into default; and that ANZ therefore could not sue on the second loan contract. The borrowers also threatened to cross claim against ANZ for breach of the first loan. Read the rest of this entry »
Family Law Property Alert #1: Think Twice before Suing Short Term Partners for Return of Imprudent Gifts
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
How besotted do you have to be in a short-term, intimate relationship before you are so emotionally dependent that gifts can be set aside as unconscionable dealings?
Well, according to the Victorian Court of Appeal in Mackintosh v Johnson [2013] VSCA 10 (8 February 2013) it takes a bit more than some have thought.
This case involved a relationship of about 8 months between Mr Johnson (aged 73) and Ms Mackintosh (aged 45). In that time, Johnson paid Mackintosh about $175,000 to support her business and $480,000 to buy a house in her name. Johnson then commenced proceedings in the Victorian County Court against Mackintosh to recover the sum of $175,000 and the house, on various grounds, but including for unconscionable conduct. That is, because Johnson made the payments acting under a special disability, Mackintosh knew of that disability and she unconscientiously exploited it. Johnson’s special disability was said to be his emotional dependence on Macintosh, due to his infatuation with her. Read the rest of this entry »
Suppressing Sensitive Information in Family Law
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
The Family Law Act and related legislation were recently amended to give Family Law Courts specific powers to make suppression and non-publication orders. Non-publication orders prevent the publication of information in print, radio, television or on-line. Suppression orders go further to prevent the dissemination of information by any means, including by word of mouth. Protected information can include the identity of parties to a Family Law case, or persons associated with them; evidence used in the case; and information parties are required to exchange with each other. It is an offence to contravene a suppression or non-publication order, punishable by imprisonment for up to 12 months and/or a fine of up to $6,600. Read the rest of this entry »
When Disclosure Can Be Better Than Concealment
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
The Queensland Supreme Court recently decided a dispute about the extent of a guarantor’s obligations. The case is factually complex, but the crux of it is that the guarantor, Willaire Pty Limited stated it had signed a mortgage document as drafted by a lender; but subsequently added an additional page of conditions to the mortgage which purported to restrict the amount the guarantor was liable for, and the assets that could be enforced against. Read the rest of this entry »
Adverse Action in the Workplace
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
The High Court recently looked at the issue of “adverse action” in the workplace. Under s346 of the Fair Work Act 2009 an employer cannot take adverse action against an employee on the basis that the employee “is …. an Officer or member of an industrial association” or “engages …. in industrial activity”. Adverse action includes dismissing an employee or altering his/her position to the employee’s prejudice. Read the rest of this entry »
Family Law, Self-Represented Litigants & Incapacity
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
Courts generally have the power to order that a party to litigation before them, who lacks sufficient capacity, will have decisions about their case made for them by a person acting in their interests. These persons are referred to by different names in different Courts, such as a case guardian, a litigation guardian or a tutor. Unlike a solicitor or barrister, who must only act on their client’s instructions whilst representing them, a case guardian makes decisions for a party to the case and may instruct a lawyer on their behalf. Read the rest of this entry »
The Very Idea of Property Settlement For Intact Marriages
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
The High Court has recently confirmed that Family Law Courts have the power to grant to spouses orders for property settlement, even where their marriage is still intact and they have not voluntarily separated. The case of Stanford v. Stanford concerned a second marriage of 40 years in duration. The husband and wife had each left their estate to their respective children of their previous marriages in their wills. Their most valuable property was their family home, which was registered in the husband’s sole name. When the wife was incapacitated by a stroke and had to move into full-time residential care, the wife’s daughter commenced proceedings against the husband for property settlement in the Family Court of Western Australia, on behalf of the wife. This was so even though the husband had no intention of separating from the wife and he had set aside funds for her ongoing additional expenses. Read the rest of this entry »
Surrogacy Arrangements in NSW
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
A surrogacy arrangement is an arrangement under which a woman agrees to become pregnant and for parentage of the child born as a result to be transferred to the intended parent or parents. In NSW, since 2011, it has been possible to apply to the Supreme Court to formalise certain surrogacy arrangements by the making of a parentage order under the Surrogacy Act. By the order, the child becomes a child of the intended parents named in the order and the child stops being a child of the birth parent. The child of such surrogacy arrangements has the same rights in relation to the intended parents as a child born to them, and the intended parents have the same parental responsibility as the birth parent had before the order was made. Read the rest of this entry »
Child Support: Getting a Second (or Third or Fourth) Opinion
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
Parents have a continuing obligation to contribute to the support of their children, even after they separate and the children no longer live with them. The concept of child support is now widely understood, including that a parent or other carer with whom children of a liable parent live can apply to the Department of Human Services – Child Support for an assessment as to the liability of the other parent to make regular payments of child support. The Department also provides a service in collecting those payments from the liable parent unless the carer and liable parent make their own arrangements for collection.
The New Anti-Phone Driving Law
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
As of 1 November 2012, the NSW Road Rule as to how mobile phones can be used whilst driving has become tougher. Previously, unrestricted licence-holders could only use a phone whilst the vehicle is moving, or is stationary but not parked, if it was not held in their hand. Use includes holding the body of the phone to one’s ear (whether or not engaged in a phone call); entering or placing anything into the phone other than by the use of voice, or sending or looking at anything that is in the phone (this includes text messages and on-line content); turning the phone on or off; and operating any other function of the phone. Read the rest of this entry »
Mullane & Lindsay Taking The Lead By Appointing Its First Female Director
While recent statistics from the Law Society of NSW reveal that only 18% of those managing law practices in NSW are women, Mullane & Lindsay Solicitors continues to uphold its mantra of taking the lead, by recently appointing its first female director Kristy Nunn.
Mullane & Lindsay is a long established law firm based in the Civic precinct, close to the new State Courthouse which is currently under construction. The firm was established in the late 1970’s by novocastrians The Honourable Graham Mullane and Robert Lindsay and has since grown to be one of the best regarded firms in the region. Read the rest of this entry »
Directors’ Duties – Insolvent Trading: Part 4
Mark Sullivan is a Director at Mullane & Lindsay in Newcastle and specialises in Family, Relationship and Matrimonial Law
Directors also have a duty to prevent insolvent trading.
A director’s liability for insolvent trading will arise if the company is unable to pay its debts as and when they become due and payable, or it becomes insolvent as a result of incurring a debt, and at that time there were reasonable grounds for the director to suspect that the company was insolvent or would be made insolvent by reason of incurring that debt. Read the rest of this entry »
Courts Raise Standards for Financial Diligence and Good Process by Directors: Part 3
Mark Sullivan is a Director at Mullane & Lindsay in Newcastle and specialises in Family, Relationship and Matrimonial Law
Practical implications for directors seeking to adhere to proper standards of care and diligence can be gleaned from litigation scrutinising the actions of directors in recent high profile cases. One such case is the James Hardie case. Some practical tips for directors confirmed from this litigation to date include:
(a) Directors should receive copies of documents to be discussed at meetings in advance;
(b) Directors should make a formal vote on each resolution;
(c) The minutes of meetings, where appropriate, should record the process and rationale in order to show, for instance, that a business judgment has been exercised; Read the rest of this entry »
Directors’ Obligations and Duties: Part 2
Mark Sullivan is a Director at Mullane & Lindsay in Newcastle and specialises in Family, Relationship and Matrimonial Law
Directors of companies must comply with obligations and duties that are set out in the Corporations Act. In recent years there has been significant litigation scrutinising the actions of directors. The statutory obligations of directors have been considered and commented upon by Courts.
In the 2009 NSW case of ASIC v Rich, His Honour Justice Austin provided a useful analysis of a director’s duty of care and diligence. He suggested that such a duty incorporates a minimum standard of diligence that requires every director or officer of a company, including a non-executive director, to: Read the rest of this entry »
Directors to Act with Due Care and Diligence: Part 1
Mark Sullivan is a Director at Mullane & Lindsay in Newcastle and specialises in Family, Relationship and Matrimonial Law
Section 180 of the Corporations Act requires directors to act with due care and diligence. If a breach is alleged and litigation is commenced a Court will need to decide what an ordinary person in the circumstances of and with the responsibility of a director might be expected to have done in the circumstances if that person was acting as a director.
The Concept of Parental Alienation
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
Family Law parenting disputes that end up becoming a case heard by aFamily Law Court often involve the concept of “parental alienation”. It relates to the situation of a child strongly preferring one parent over the other, to the point of rejecting spending time with the other parent. As parental alienation is a cause of conflict between separated parents that prevents them agreeing to amicable parenting arrangements in the best interests of their children, it is helpful for parents in dispute to have an understanding of the concept.
First, parental alienation is not “parental alienation syndrome”, which was a faddish psychological diagnosis that has been discredited in the past decade. Instead, parental alienation is one extreme end of a range of responses children are seen to have to their parents. The other (positive) extreme is where a child has a positive relationship with both parents and enjoys spending time with each. Next to that positive end is the still-positive situation where a child has an affinity for one parent, but enjoys spending time with both. Read the rest of this entry »
Restraint of Trade Clauses – The Devil is in the Detail
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
The Victorian Supreme Court recently considered a restraint of trade dispute. Mr Cottee resigned from Nexus Energy. He later agreed to become a director of Austin Exploration. Part of the argument before the Court was whether Mr Cottee became a director in breach of a restraint of trade provision preventing him being involved in an industry that was the “same as or similar to” that of Nexus.
Both companies were oil and gas exploration companies. The evidence before the Court was that Nexus was primarily an Australian based, offshore oil and gas exploration business. Austin was a mainly American based, on shore oil and gas exploration and production business. Austin did have some business interests within Australia, but at all relevant times they were dormant. Read the rest of this entry »
Interim Payment of Damages
Tony Cavanagh is a Director at Mullane & Lindsay in Newcastle and is one of LawCover’s panel solicitors.
A little known provision of the Civil Procedure Act was recently considered by the Supreme Court in Ryan v AF Concrete Pumping Pty Limited [2012] NSW SC 723. Mr Ryan was injured when concrete being pumped on a building site was blown through a pipe, hitting him in the face and head. Both the concreter and the head builder denied liability for the injuries that resulted.
Ordinarily, the award of, and payment of, damages must wait until the end of defended cases. However under Section 82(3)(c) of the Civil Procedure Act, the Court has a discretion, in certain circumstances, to make an order for an interim payment. To do so, the Court must be satisfied a plaintiff would obtain “judgment for substantial damages”. There are also a number of specific factors which, if proved, prevent an interim payment being made. Read the rest of this entry »
Family Law Property Settlement: When Bankruptcy Overshadows All
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
Earlier this year, legislation was amended to make it clear that the Family Court’s own rules apply when a bankruptcy case is transferred to it from the Federal Court. It is still not widely recognised that Family Law Courts have bankruptcy powers in their own right where one of the parties to a Family Law property case is or may be declared bankrupt. This vesting of family law and bankruptcy powers in a single court has lead to a situation, in some cases, where the interests of the non-bankrupt spouse are balanced against the interests of the trustee in bankruptcy for the bankrupt spouse.
The usual approach that Family Law Courts adopt in determining an application for property settlement, and particularly in relation to longer marriages, is to firstly pool together all of the property of both parties, as to its value. From that single value is then usually subtracted the total value of the parties’ joint and several liabilities. In this way, payment of creditors is taken into account first, before the net value of the property is then considered available for division between the parties, according to their contribution and having regard to their future needs and other considerations. Read the rest of this entry »
When Lightning Strikes Twice: Death and Separation
David Gawthorne is a Senior Solicitor at Mullane & Lindsay in Newcastle and an Accredited Specialist in Family, Relationship and Matrimonial Law
Two events that many resist planning for are their death and their separation from their spouse or de facto partner. Even though the probability of death is greater than that of separation, younger people often treat both as mere possibilities. It is therefore common for death and separation to be dealt with only when they loom and this means that both aspects are generally not considered at the same time. Yet, it should come as no surprise that death and separation sometimes strike at around the same time.
Someone negotiating a property settlement with their former partner could die with a last Will that provides for their former partner to receive all of their estate. Perhaps they do not die, but become ill or disabled to the extent of lacking capacity to manage their own financial affairs. An existing enduring power of attorney and appointment of enduring guardian may then result in their former partner having control of their financial affairs and living arrangements etc. Wills, powers of attorney and guardianship appointments therefore need to be looked at, as a priority, at the time of separation. Read the rest of this entry »