by | Aug 11, 2023

Show Me the (Interim) Money: Running Interim Spousal Maintenance Claims in the FCFCOA

Introduction

It is no secret that the primary goals of the Federal Circuit and Family Court of Australia (FCFCOA) are to encourage dispute resolution and reduce the time and costs for parties to resolve their disputes. However, for many parties the new case management pathway and procedures have not resulted in more expedient and less costly resolution. Where parties seek interim orders, the proceedings start slowly, almost lethargically, as the parties must comply with the pre-action procedures, and once they issue proceedings, they are given a First Court Event before a Judicial Registrar (JR) with limited powers.

This paper looks at how this new regime is working for interim maintenance claims, and other options for parties when the system isn’t working. It covers:

  1. When is a party eligible for maintenance?
  2. The tests for interim and urgent maintenance
  3. The case management pathway – why interim maintenance applications may not be listed with priority
  4. The effects of delay 
  5. Other options
  6. Review of decisions made by senior judicial registrars.
  7. Interim property settlement orders
  8. Backdating of maintenance orders
  9. Running a truncated hearing
  10. Costs orders 
  11. Injunctions
  12. What lies ahead?

When is a party eligible for maintenance?

The right of a spouse to maintenance is set out in s 72 Family Law Act 1975 (Cth) (FLA) (s 90SF(1) for de facto couples):

A party to a marriage is liable to maintain the other party, to the extent that the first-mentioned 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).

A maintenance order is made under s 74 (s 90SE). The court must “make such order as it considers proper for the provision of maintenance in accordance with this Part.” It does this by taking into account the matters referred to in s 75(2) (s 90SF(3)). 

The power to make an interim order is set out in s 80(1)(h) (s 90SS(1)(h)), as is the power to make a permanent order, but the making of a permanent order is constrained by s 81 (s 90ST), which sets out the duty of the court to end financial relations as far as is practicable.  Maintenance orders usually require periodic payments, or the payment of particular expenses, but the payment of lump sums or the transfer of property are also possible.

The Full Court of the Family Court in Brown & Brown (2007) FLC 93-316; [2007] FamCA 151 (at [161]) summarised the propositions which had emerged from the cases:

  • The word “adequately” is not to be determined according to any fixed or absolute standard.
  • The idea that “adequate” means a subsistence level has been firmly rejected.
  • Where possible both spouses should continue to live after separation at the level which they previously enjoyed if this is reasonable, although the parties’ standard of living may have to be lower if financial resources are insufficient to maintain that standard.
  • In some circumstances it may be reasonable for the parties to live at a higher standard than previously enjoyed.
  • It is not necessary for an applicant for maintenance to use up all capital in order to satisfy the requirement that he/she is unable to support himself/herself adequately.
  • However, an applicant is not entitled to live at a level of considerable luxury or comfort merely because the other party is very wealthy.

What are the tests for interim and urgent maintenance?

The test for interim maintenance was considered by the plurality of the High Court of Australia in Hall v Hall [2016] HCA 23; (2016) FLC 93-709. The High Court said (at [8]):

Unlike a court exercising the power to make an urgent order conferred by s 77, a court exercising the power to make an interim order under s 74(1) must be satisfied of the threshold requirement in s 72(1) and must have regard to any matter referred to in s 75(2) that is relevant [Redman & Redman [1987] FamCA 2; (1987) FLC 91-805 at 76,081]. No doubt, on an application for an interim order “[t]he evidence need not be so extensive and the findings not so precise” as on an application for a final order [Redman]. But there is nothing to displace the applicability to an exercise of the power conferred by s 74(1) of the ordinary standard of proof in a civil proceeding now set out in s 140 of the Evidence Act 1995 (Cth). A court determining an application for an interim order under s 74(1) cannot make such an order without finding, on the balance of probabilities on the evidence before it, that the threshold requirement in s 72(1) is met having regard to any relevant matter referred to in s 75(2).

The requirements for a successful application for urgent maintenance are less strict than for an interim application. An application for urgent maintenance is made under s 77 (90SG). Pre-1 September 2021, applications for urgent maintenance were often made orally at the first return date of an Initiating Application for Final Orders which had been listed at short notice. Due to the post 1 September 2021 case management pathway (discussed below) it is likely that fewer applications for urgent maintenance are being made or are succeeding.

The power still exists and was considered in Keir & Ramsay (No 3) [2022] FedCFamCIF 746. Justice Campton examined the legislation and authorities dealing with s 77. As described by the High Court in Hall (at [7]), s 77 (s 90SG) requires two conditions to be met:

First, it must appear to the court that a party to the marriage “is in immediate need of financial assistance”. Second, it must be “not practicable in the circumstances to determine immediately what order, if any, should be made.”

In Sadlier & Sadlier [2015] FamCAFC 130; (2015) FLC 93-658, the Full Court of the Family Court referred to the reasoning of Nygh J in Ashton & Ashton (1982) FLC 91-285, saying (at [37]):

Urgent maintenance orders are often referred to as “stop-gap” orders which are provided to assist with an immediate need of the spouse until a hearing can be set down for spouse maintenance orders pursuant to section 72 and 74 of the Act.

In Malcolm & Malcolm [1977] FamCA 27; (1977) FLC 90-220, Watson J said (at [12]) that the purpose of s 77:

is to provide emergency funding in most cases where the Court is unable to determine immediately what order should be made.

In contrast to interim applications, in Chapman & Chapman [1979] FamCA 14; (1979) FLC 90-671 the Full Court of the Family Court held that it was not absolutely necessary under s 77 to distinguish between the expenses of the wife and the children.

Justice Campton concluded in Keir & Ramsay (at [48], [50] – [52]):

In other words, unlike the requirements of the Act in respect of an application for interim de facto spouse maintenance, an application for urgent de facto spouse maintenance is not required to satisfy any of the thresholds identified in the Act or any of the other considerations set out in s 90SF(2) of the Act. That is not to say, however, that, depending on the facts of the particular case, those considerations may well be relevant to the Court’s exercise of discretion in considering any application pursuant to s 90SG of the Act.  …

The duration of the order is an important matter to be considered. Most of the authorities identify that the period for urgent spouse maintenance is relatively short until, for example, there could be a hearing as to interim spouse maintenance.

The rules of Court set out very clearly that the provision, for example, of the mandatory documents identified for interim de facto spouse maintenance in r 6.06(9) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”), must be available at an interim spouse maintenance hearing. They are not necessarily required for the purpose of an urgent de facto spouse maintenance hearing.

In the circumstances of this case, I find that for the purposes of an urgent de facto spouse maintenance hearing, the broad assertive evidence of the respondent and his disclosure of failures as identified do not permit me to be satisfied that he has established an urgent or pressing need for maintenance pursuant to the section relied upon in a lump sum of $50,000. The identification of that source of power to, in reality, access the respondent’s own funds by way of a variation of an injunctive order cloaked as urgent de facto spouse maintenance, is wholly misconceived. Putting it another way, he is not seeking an order for payment of monies on an urgent basis from the property or resources of the applicant.

The case management pathway – why interim maintenance applications may not be listed with priority

The case management pathway in the FCFCOA is set out in the Federal Circuit and Family Court of Australia Act 2021 (Cth) (FCFCOA Act), the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (the Rules) and the Central Practice Direction (CPD).

Overarching purpose

Setting out the case management pathway in detail is beyond the scope of this paper, but the overarching purpose is a strong influence on the procedures, both in theory and in practice. As set out in r 1.04 of the Rules:

  • The overarching purpose of these Rules, as provided by s 67 of the Federal Circuit and Family Court Act, is to facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible. 
  • Parties to family law proceedings must conduct the proceeding (including negotiations for settlement of the dispute to which the proceeding relates) in a way that is consistent with the overarching purpose.
  • A party’s lawyer must, in the conduct of a proceeding before the court (including negotiations for settlement) on the party’s behalf:
  • take account of the duty imposed on the party referred to in subrule (2); and
  • assist the party to comply with the duty. 

There are 10 Core Principles in the CPD. Those that are primarily relevant to interim maintenance applications are:

CORE PRINCIPLE 2 – Parties’, lawyers’ and the Court’s obligations and overarching purpose

  • The overarching purpose to be achieved is to facilitate the just resolution of disputes:
  • according to law; and
  • as quickly, inexpensively and efficiently as possible.

3.4 The overarching purpose includes the following objectives:

  • the just determination of all proceedings before the Court;
  • the efficient use of the judicial and administrative resources available for the purposes of the Court;
  • the efficient disposal of the Court’s overall caseload;
  • the disposal of all proceedings in a timely manner;
  • the resolution of disputes at a cost and by a process that is proportionate to the importance and complexity of the issues in dispute.

3.5 This Central Practice Direction and the Family Law Rules must be interpreted and applied in the way that best promotes the Court’s overarching purpose and prioritises the best interests of children.

CORE PRINCIPLE 3 – Efficient and effective use of resources

3.6 The Court’s judicial, registrar and Court Child Expert resources are to be allocated and used efficiently to achieve the overarching purpose in the context of ensuring the appropriate handling of risks wherever they are identified as issues in proceedings.

CORE PRINCIPLE 4 – Approach to case management 

3.7 Effective case management of all cases relies on:

  • a consistent approach to the case management of like cases;
  • early triaging of matters to an appropriate case pathway, including assessment of risk; and
  • the prioritisation of both internal and external Dispute Resolution, including private mediation, Family Dispute Resolution (FDR), Conciliation Conferences and arbitration in property disputes for as many appropriate cases as possible. …

CORE PRINCIPLE 5 — Importance of Dispute Resolution

3.9 The Court encourages the use of Dispute Resolution procedures. Before commencing an action, unless it is unsafe to do so, parties are expected to make a genuine attempt to resolve their dispute, including by complying with the requirements and obligations of section 60I of the Family Law Act and the pre-action procedures as set out in Schedule 1 to the Family Law Rules. Subject to an exception applying, the Court must not hear an application for parenting orders unless a Section 60I certificate has been filed.

3.10 After the commencement of an action, parties are expected to:

  • be proactive in identifying the appropriate time, and the appropriate way, in which they can participate in Dispute Resolution, either by agreement or by court order; and
  • be prepared to make and consider reasonable offers of settlement at any stage of the proceedings. Failure to do so may have costs consequences.

CORE PRINCIPLE 7 — Lawyers’ obligations about costs

3.13 Parties and their lawyers are expected to take a sensible and pragmatic approach to litigation, and to incur only such costs as are fair, reasonable and proportionate to the issues that are genuinely in dispute. Lawyers are expected to act consistently with costs estimates provided to their clients, and regularly inform their clients and the court of the actual costs they have incurred and are likely to incur (see Part 12.3 of the Family Law Rules).

CORE PRINCIPLE 8 – Identifying and narrowing issues in dispute

  • Issues in the case are to be narrowed to those issues genuinely in dispute. In particular: 
  • all parties are required to make full and frank disclosure to assist the Court in the determination of the dispute or the parties in the resolution of the dispute; 
  • applications should only be brought before the Court if they are reasonably justified on the material available; 
  • it is expected that parties will negotiate both prior to, and at Court, in order to reach agreement about as many of the issues in dispute as possible and procedural directions required before having the matter heard; 
  • when appropriate, a single expert or an assessor should be engaged to assist the parties and the Court to resolve disputes; and
  • costs consequences may flow if parties unreasonably seek to reopen issues already resolved or unreasonably agitate issues. 

Reading these Core Principles, the best interests of and the safety of children is prioritised, there is an emphasis on dispute resolution, there are guidelines for the allocation of court resources, and also requirements that legal costs are proportionate to the importance and complexity of the issues in dispute. You may wonder if interim maintenance applications are ever listed at all. 

Pre-action procedures

Each prospective party is required by r 4.01(1) to make a genuine effort to resolve the dispute before filing an application to start proceedings by following the pre-action procedures in cl 3 of Sch 1, Pt 1 (financial); cl 3 of Sch 1, Pt 2 (parenting). The requirements include that each party, to the extent that it is safe to do so:

  • cooperate for the purpose of agreement on an appropriate dispute resolution service; and
  • make a genuine effort to resolve the dispute by participating in dispute resolution (Sch 1, Pt 1, cl 3(2); Sch 1, Pt 2, cl 2(2)).

The parties’ disclosure obligations commence before proceedings are issued. The disclosure obligations of the Rules are reflected in the pre-action procedures (Sch 1, Pt 1, Cl 4). Specifically, in relation to maintenance applications, parties are required to provide the documents listed in r 6.06(8) which are:

Without limiting subrule (1), unless the court otherwise orders, a party (the first party) who is required by this rule to file a Financial Statement (other than a respondent to an application for maintenance only) must, before the first court date, serve on each other party who has an address for service in the proceeding the following documents:

(a) a copy of the party’s 3 most recent taxation returns;

(b) a copy of the party’s 3 most recent taxation assessments;

(c) if the first party is a member of a superannuation plan:

(i) the completed superannuation information form for any superannuation interest of the party (unless it has already been filed or exchanged); and

(ii) for a self-managed superannuation fund–the trust deed and a copy of the 3 most recent financial statements for the fund;

(d) if the party has an Australian Business Number–a copy of the last 4 business activity statements lodged;

(e) if there is a partnership, trust or company (other than a public company) in which the party has an interest–a copy of the 3 most recent financial statements and the last 4 business activity statements lodged by the partnership, trust or company.

However, pursuant to r 6.06(1) the general duty of disclosure applies to maintenance proceedings, so r 6.01 is relevant:

(1) Subject to subrule (4), each party to a proceeding has a duty to the court and to each other party to give full and frank disclosure of all information relevant to the proceeding, in a timely manner.

(2)  The duty of disclosure applies from the start of the proceeding and continues until the proceeding is finalised.

Note: Parties are also expected to comply with the duty of disclosure when complying with the pre-action procedures.

The pre-action-action procedures “encourage parties, if proceedings become necessary, to seek only orders that are reasonably achievable on the evidence” (Sch 1, Pt 1, Cl 1(4)(e)). This objective is not expressed in such clear terms in the Rules, so it is arguable that this is a “motherhood” statement although the objective is supported by the overarching purpose.

The requirements set out in the pre-action procedures are regarded by the FCFCOA as the standard and appropriate approach for a person to take in most circumstances before filing an application in a court (Sch 1, Pt 1, cl 2(1); Sch 1, Pt 2, cl 2(1)). The exemptions in r 4.03(2) are:

(a) compliance will cause undue delay or expense; or

(b) the application would be unduly prejudiced; or

(c) the application is urgent; or

(d) there are circumstances in which an application is necessary (for example, if there is an allegation of child abuse, family violence or fraud).

Unreasonable non-compliance with pre-action procedures may result in the court ordering a stay of the proceedings pending compliance or ordering that the non-complying party to pay all or part of the costs of the other party or parties (Sch 1, Pt 1, cl 2(4); Sch 1, Pt 2, cl 2(4)).

Additional obligations are imposed in parenting proceedings by s 60I, which provides that a court cannot hear an application for a Pt VII order in relation to a child unless the applicant files a certificate given to the applicant by a family dispute resolution practitioner (FDRP) under s 60I(8). A party may therefore delay issuing financial proceedings, including for interim maintenance, because it seems sensible to issue parenting proceedings at the same time as a financial proceeding.

What does all this mean for interim or urgent maintenance applications?

Post 1 September 2021, it appears from trawling through www.austlii.edu.au, and speaking to judicial officers and lawyers, that interim hearings are rarely the first listing. Neither the Annual Review of the FCFCOA 2021-22 nor the FCFCOA website provide any useful statistics, but anecdotally it seems to be almost impossible to obtain an urgent interim hearing and by-pass the First Court Event. Matters which were considered to be urgent before 1 September 2021 are rarely considered to be urgent after that date. 

Whilst the CPD allows parties to seek that their matter be listed urgently (item 4.6), when requests for urgent interim hearings are triaged by JRs very few cases are considered to be sufficiently urgent to avoid the usual “First Court Event” before a JR. This decision is made by a JR in circumstances where the filing party’s lawyer has considered the matters sufficiently urgent to seek an interim hearing rather than the usual First Court Event, and possibly rely upon the urgency exemption to the pre-action procedures. In some cases, complying with the pre-action procedures has caused delay, so that the issues have become urgent. 

A judicial registrar does not have the same powers as a senior judicial registrar (SJR) or a judge to make contested substantive orders. At the First Court Event a JR can only make substantive orders if the parties agree, but otherwise only procedural orders will be made as to how the matter will progress. 

The length of time between filing and the First Court Event varies around the country, and ebbs and flows. According to the FCFCOA website, parties can expect the First Court Event to be between 1 and 2 months from the date of filing. Anecdotally, an interim hearing may be 2, 4, 8, or even 12 weeks later. 

Applications for interim or urgent maintenance are usually adjourned from the First Court Event to an interim hearing on a later date, sometimes with a private mediation in between. There seems, in the writer’s experience, to be a view by some judicial officers that the parties should have a private mediation before interim applications are listed. Their rationale appears to be that if the parties settle their financial affairs on a final basis, the interim hearing will not be required. It is far from clear that this is the case. An unsuccessful mediation results in further costs to the parties and may not assist in resolving property and maintenance matters on either an interim or final basis.

Again, anecdotally, from the writer’s limited research, it seems that judges, at least in Melbourne, are rarely, if at all, hearing interim maintenance applications. Discrete applications for interim maintenance are usually listed before an SJR “fairly quickly” (not sure what that means) after the First Court Event. Although it may be easier to obtain an earlier listing in a simpler case with a modest property pool, than where there is a larger, more complex property pool the parties and their respective legal practitioners need to assess whether it is cost effective to run the case at all.  Is it practical to run an interim maintenance application at a cost of say $5,000 each for a net gain to the applicant of a few hundred dollars per week? There is also the principle of “proportionality” referred to in Schedule 1, Pt 1, clause 5(h) of the pre-action procedures. This principle also applies once a case is commenced. Rule 12.08(1) of the Rules requires legal costs incurred in a proceeding to be:

“(a) fairly, reasonably and proportionately incurred; and

(b) fair, reasonable and proportionate in amount;

in the circumstances of the proceeding.”

The speed with which discrete applications for interim maintenance are listed before an SJR after the First Court Event will depend primarily upon:

  • the availability of an SJR to hear the matter;
  • the parties’ readiness to proceed; 
  • whether interim maintenance is a discrete issue; 
  • the urgency of the need, as assessed by the triaging JR.

If there is a discrete application for interim maintenance and the parties are both ready to proceed, it may be listed within 2-3 weeks of the First Court Event. However, many interim maintenance applications are not discrete applications, but tied up with interim property and interim parenting issues. These issues can be difficult to untangle so that some issues cannot be heard separately (and doing so would not meet the over-arching purpose or the Core Principles in the CPD) and which interim issues should be given priority is frequently in dispute.

Greater delays are experienced with the “hamburger with the lot” and “souvlaki with the lot” type of application for other interim financial relief (e.g. partial property settlement, litigation funding orders, discovery) or for both parenting and financial interim relief. These applications will often not be listed for an interim hearing before a SJR for several weeks, or even months. The FCFCOA might say that this is largely as a consequence of the matter not being assessed by the JR at the First Court Event as being ready to proceed. However, pre-1 September 2021 matters were often listed for interim hearings based on the expectation that parties would comply with court directions in the intervening period, and the matter would be ready to proceed by the listed date. Another limitation is that r 5.09(1) states that the hearing of an application for interlocutory orders must be no longer than 2 hours, unless the court otherwise directs. 

In summary, the delays in the listing and hearing of interim maintenance applications, anecdotally seem to arise from:

  • the triaging JR taking a narrow view as to the urgency of applications;
  • lack of availability of SJRs and judges (the FCFCOA may not agree with this view, and it may not be accurate);
  • the preference of the FCFCOA that matters are ready to proceed before they are listed;
  • the complexity of a particular matter. It is unlikely that the FCFCOA will list an interim maintenance application separately from an interim property settlement application and/or parenting applications, but the greater the complexity of the issues the more difficult to ensure it is ready to proceed and to find a time slot sufficient to hear it.

The FCFCOA’s Case Management Pathway is not wholly the cause of the lack of priority given to maintenance applications. Prior to pre-1 September 2021 there were problems, but anecdotally these appear to have arisen from insufficient SJRs and judges available to hear these applications. 

Effect of delay

The effects of delay for the parties in the hearing of applications for interim maintenance include unnecessary legal costs, extra hearings, changes in circumstances, and implied or explicit pressure to settle on an interim or final basis. Also, the evidence may change, and/or need updating. The test for urgent maintenance is less likely to be satisfied when the interim hearing is delayed. If the application was made under s 77, there is time to file a financial statement and other materials in support, so it is no longer appropriate that the court consider the application under s 77. 

The following two cases seem to the writer to be typical of the time frames experienced by litigants.

In Kensit & Kensit [2022] FedCFamC1F 633 the chronology before an interim maintenance order of $896 per week, was made:

19 August 2020 Parties separated under the one roof
November 2020 Wife and children moved into rental accommodation
6 November 2020 Parties attended mediation and agreed to final parenting arrangements, but they both subsequently resiled from them
January 2021 Wife’s wages from family business ceased
15 February 2021 Husband filed Initiating Application seeking property settlement orders
17 February 2021 Wife’s Further Amended Response to Initiating Application
8 November 2021 Interim orders made – interim property and the husband to make mortgage payments on a property
Early 2022 Parties divorced
25 April 2022 Wife filed Application in a Proceeding seeking interim maintenance (unclear if this was before the court previously) 
28 July 2022 Hearing of competing applications for interim property and parenting application. They settled by consent, save for the wife’s application for interim maintenance which was heard and an order was made that the husband pay $896 per week from his after tax income of $2,125.

The parties attempted to resolve matters through mediation and proceedings were not issued until the parties had been separated for 6 months. It was another 17 months before the court made quite a substantial order for interim maintenance in circumstances where for 18 months the applicant wife had been reliant upon Centrelink benefits as her sole source of income.

The chronology in Venter & Venter [2022] FedCFamC1A 122, where the wife sought leave to appeal an order made on review discharging an earlier order for interim spousal maintenance, was:

Mid-2017 Parties separated
Mid-2017 to September 2020 Wife received payments of $1,068 per week from the “D Group”
September 2020 Payments to wife increased to $2,200 per week
August 2021 Wife initiated property settlement proceedings 
19 October 2021 Weekly payments to the wife from the D Group ceased
28 October 2021  Wife filed interim application for spousal maintenance 
16 December 2021 Orders made by SJR for husband to pay interim maintenance of $7,200 per week to the wife and health insurance premiums.
4 January 2022 Husband filed application for review
January 2022 Judge discharged interim maintenance orders
February 2022 Wife appealed
27 July 2022 Hearing of appeal
4 August 2022 Judgment – application for leave to appeal is dismissed

 

Unlike Kensit, where it is unclear from the judgment when the wife first filed her application for interim maintenance, it is clear in Venter that the wife filed promptly after her income from the D Group ceased and that her interim maintenance application was heard 7 weeks later. The review and appeal process took a further 7 months to resolve this aspect of the proceedings, and for it to be confirmed that there should be no order for interim maintenance. The wife did not establish that it was not reasonably open for the lower court to find that the husband had “control” of the D Group sufficient that he had the capacity to pay interim maintenance to the wife.

Other options

If your client has an urgent need (whether in the s 77 sense or otherwise) for spousal maintenance, the first hurdle is determining whether there has been compliance with the pre-action procedures. If an application is filed and a priority listing is refused, what options are there? Approaches to consider include: 

  1. Apply early and argue an exemption from the pre-action procedures is appropriate. Perhaps, legal practitioners are being too cautious about complying with the pre-action procedures, possibly based on them taking their obligations under the Rules, the CPD and the pre-action procedures seriously, and their experience filing applications with urgency and a priority hearing has been refused? There is an exemption for urgency in r 4.02(c), and there are other exemptions which may apply. If the parenting aspects are not urgent enough to satisfy the threshold of urgency, those proceedings can be filed separately, after a s 60I certificate has issued. Maybe, clients should be assisted into the system earlier?
  2. Seek a review under r 14.05 of the refusal to give a priority listing of the interim hearing. Discussed further below.
  3. Try to negotiate interim issues either in correspondence between lawyers, at a roundtable conference or a mediation (even if the parties had one before proceedings were issued). If unsuccessful, they may still need that interim hearing, and may regret incurring the costs of further unsuccessful attempts to resolve the dispute without the assistance of the FCFCOA.
  4. Arbitration – perhaps on the papers. 
  5. Although it is to meet living expenses, propose or agree to a cash lump sum being paid which is characterised as an interim or partial property settlement. Discussed further below.
  6. Seek a backdating of the interim maintenance order once it is obtained. Discussed further below.
  7. Agree to run a truncated hearing, such as a hearing without cross-examination, so as to obtain an earlier date because the hearing time will be shorter. Discussed further below.
  8. Seek costs on the basis that the respondent’s conduct in not agreeing to pay interim maintenance has been unreasonable in not agreeing to pay interim maintenance. Discussed further below. 
  9. Make a Calderbank offer to put pressure on the respondent, and rely upon it for a costs order when the matter is ultimately listed. Discussed further below.
  10. Agree to a final property settlement which may be less favourable than if the applicant had first obtained an interim maintenance order. Discussed further below.
  11. Seek consent to injunctions to achieve the same effect as an interim maintenance order. Discussed further below.
  12. File an Application in a Proceeding — this may be assessed by a different JR.
  13. Although not always possible, encourage your client to simplify the case so that there are not as many issues requiring determination on an interim basis.

Reviews of decisions 

As set out above, the timeframe between the filing date and the hearing of an interim application for maintenance can be lengthy. This is particularly concerning for those applicants with a genuine need for maintenance. Delays are also experienced with the hearing of reviews of decisions of JRs and SJRs, which is concerning both for applicants for maintenance who are unsuccessful although in genuine need and for respondents who are ordered to pay but cannot pay the quantum of maintenance ordered. 

If a party is aggrieved by a decision as to either:

  1. The refusal by a JR to list an application for maintenance urgently; or
  2. The outcome of a maintenance application heard by a SJR,

the aggrieved party can seek a review under r 14.05. This is intended to be a faster process than an appeal from a decision of a judge. The Application for Review must be listed for a hearing as soon as possible, and unless it is not practicable to do so, within 28 days after the date of filing.

The first type of decisions which are subject to reviews appear to be notoriously unsuccessful. Lombardi & Rider [2021] FedCFamC2F 57 was one of the first in a long line of such decisions. Chief Judge Alstergren said (at [42]–[48]):

As to ‘whether a judicial officer is available to hear the substantive application’, in the interests of deterrence, the Court must discourage review applications of this nature being brought except in truly urgent circumstances. The risk is that such applications are brought on any occasion on which a party merely disagrees with a decision of a Registrar, in particular in relation to the listing of matters.

Consideration must be given to the “overarching purpose” provisions outlined in ss 190 and 191 of the Act.

I particularly note the elements of the overarching purpose which seek to ensure the efficient use of judicial and administrative resources available for the purposes of the Court and the efficient disposal of the Court’s overall caseload. The Court has a responsibility when allocating dates to make an assessment of priority as against other matters. It must balance the allocation of dates with other matters with equally competing priorities.

The civil practice and procedure provisions must be interpreted and applied, and any power conferred or duty imposed by them (including the power to make Rules of Court) must be exercised or carried out, in the way that best promotes the overarching purpose: see s 190(3) of the Act.

Whilst the Court must assess the merit of each application for review, in the context of a review of a listing decision, the Court must also have regard to the orderly and considered allocation of hearing dates. This impacts the efficient use of the Court’s resources as well as its ability to efficiently dispose of the Court’s overall caseload. I note the discussion of McClelland DCJ on the importance of the allocation of Court resources in Moxey & Keirn [2021] FamCA 615 (at [55]–[57]).

Parties should not be encouraged to regard a hearing in relation to the review of a Registrar’s decision concerning whether to abridge a matter as an opportunity to agitate their substantive application before a Judge ahead of the time that has been allocated by the Registrar.

The Court’s Registrars play a significant role in the proper and efficient functioning of the Court. The Court should not interfere in the listing decision of a Registrar unless genuine urgency can be demonstrated. I am not satisfied that is the case here.

A case in which an application for review of a decision to refuse an urgent interim hearing was successful was delivered recently – Walcott & Pane [2023] FedCFamC2F 761. Final parenting orders were made by consent in April 2022. The 9 year old child lived with the mother and spent alternate weekends and Wednesday nights with the father. On 29 May 2023, the mother sought and obtained an ex parte interim order under the Victorian state legislation and the magistrate also made an order pursuant to s 68R FLA suspending the final parenting order. The interim intervention order was listed for mention on 6 July. Judge Young accepted the submission on behalf of the father that the 6 July mention was not likely to result in the revocation of the s 68R order.

The father issued proceedings in the FCFCOA on 6 June 2023. The listing registrar refused the application to list it for an interim hearing and listed it before a judicial registrar on 19 July 2023. Judge Young described the circumstances as “unusual” and ordered phone communication to take place each week, the appointment of an Independent Children’s Lawyer and a Child Impact Report and an interim defended hearing on 20 July 2023. Judge Young said (at [9]-[11], [15]-[16]):

I accept that this matter is urgent. I accept that, given the somewhat unusual circumstances, in particular the mother’s initial position that the Wednesday needed to be changed, the apparent absence of any claim as set out in the intervention order application that the child had been physically assaulted by the father or threatened, that those circumstances are somewhat unusual. It is also unusual, I think, that if the child was struck in May of last year across the face by the father as the mother alleges, that there was no application by her. I think this matter does require judicial consideration as soon as possible, particularly having regard to the fact that the existing orders have been suspended in their entirety on the basis of an ex parte hearing and there indication [SIC] as to when those ex parte interim orders might be reconsidered.

I consider that the total suspension of orders on an ex parte basis without a definite date for that suspension to be reviewed a short time later is unusual and undesirable in this or any other jurisdiction. I consider that I do need to list the matter for an interim hearing in front of a Senior Judicial Registrar (SJR). I have some doubts about whether the SJR will be able to make much headway, particularly in view of the absence of any material that sets out the child’s wishes or any substantiation, really, of the claims. There is no evidence before me that, for example, the alleged assault on the child, or the threat of breaking the arm of another child, has been referred to the Victorian child welfare authorities….

I am satisfied that it is in the child’s best interests not to receive an explanation of the order that I have just made pursuant to [s] 68P(2)(c)(iii) as the purpose of the order is to maintain the child’s relationship with her father until this issue can be more carefully dealt with by the court. I am conscious that it is inconsistent with the intervention order made in the Victorian Magistrates Court. I am concerned that that order was for a complete cessation of orders made by this Court on an ex parte basis without there being any evident timeframe for a review by that Court of its ex parte order. As I say, I consider that to be an undesirable outcome in a matter like this…

The allegations made in the intervention order have not been tested and there has been no report, as far as I am aware, to the Victorian child welfare authorities, nor have the allegations, as far as I know, been raised at an earlier point.

I correct my reasons. The mother has asserted to me that she made a report to the child welfare authorities in Victoria but those allegations were not investigated so I assume that they were screened out. There is therefore no substantiation of those allegations.

So, maybe in an appropriate case the review of a decision not to grant an urgent interim hearing of a maintenance application might be successful, particularly where not to hear it urgently would be procedurally unfair, but the weight of the numerous decisions refusing review is heavy.

Interim property settlement orders

Usually, s 79 (s 90SM) is used to make final property settlement orders but there are occasions when it is appropriate to make interim property settlement orders. A party may need to seek both but cannot seek an interim property settlement order unless an application for final property orders is also on foot (r 5.02(2)). 

An interim property settlement order is commonly sought where one party needs a lump sum for a particular purpose such as for the purchase of a home, the payment of a debt or the payment of legal costs, accounting fees and/or valuation fees. 

The requirements were set out by the Full Court of the Family Court in Harris & Harris (1993) FLC 92-378; [1993] FamCA 49, although the first of the three considerations was overruled by the Full Court of the Family Court in Strahan & Strahan (2011) FLC 93-466, leaving the test (at [43]) as:

(2) It is an exercise of the s 79 power. Consequently it must be performed within those parameters. Since it is not the final hearing the Judge is unlikely to have the final findings, but the exercise must fall within that general framework and the material available at that time.

(3) Of necessity it is likely to be a somewhat imprecise exercise. Consequently, it must be exercised conservatively and the Judge must be satisfied that the remaining property will be adequate to meet the legitimate expectations of both parties at the final hearing, or that the order which is contemplated is capable of being reversed or adjusted if it is subsequently considered necessary to do so. It is for this reason that we doubt whether the distinction which Nygh J drew between interim and partial orders is necessary or desirable.

Anecdotally, interim property settlement orders (usually mutual so that each party receives the same sum) are made frequently so as to give the financially weaker party sufficient funds on which to live and pay legal costs. These orders may allow the matter to proceed directly to a mediation and avoid the delay and expense of an interim hearing.

The writer is unaware of any evidence (other than anecdotal) that interim property settlement orders are being made more frequently in these circumstances post-1 September 2021, than they were pre-1 September 2021. Given the insertion of the pre-action procedures into the Rules governing Division 2 of the FCFCOA (they previously only covered the Family Court (now Division 1)), and the anecdotal evidence of the difficulty of obtaining an urgent interim hearing as a first listing, the assumption seems reasonable.

The possible consequences for the applicant if they agree to an interim property settlement order, rather than an interim maintenance order include:

  1. The party in a weaker financial position may have a genuine need for spousal maintenance and the use of savings for reasonable living expenses will not normally amount to an add-back (Omacini & Omacini (2005) FLC 93-218; [2005] FamCA 195). However, an interim property settlement will form part of the party’s ultimate property entitlements even if used for reasonable living expenses.
  2. By not obtaining an order for interim maintenance, that party’s ultimate property entitlements may be less as they have not “staked out” their maintenance entitlements which needs to be “bought out”, and may have a lesser s75(2) (or s 90SF(3)) loading than if a maintenance order was made at an earlier stage in the proceeding. 
  3. The weaker party may be forced to live more frugally than the party in the stronger financial position who has a higher income and also has the benefit of an interim property settlement. This seems contrary to s 75(2)(g) (s 90SF(3)(g) — “a standard of living that in all the circumstances is reasonable”.
  4. As a matter of law, a property settlement order is not a maintenance order and a maintenance order is not a property order. They should be properly distinguished.

Maintenance orders and property settlement orders have different legislative requirements. Describing an order as, say a maintenance order, may not be decisive. An illustration of this is an order which required the husband to pay the mortgage payments on the wife’s home in Thorpe & Stirling [2021] FedCFamC1A 86; (2021) FLC 94-066. The offending clause, which was ultimately held not to be either a maintenance order or a property settlement order was:

From the date of these Orders as and when the Wife purchases a new property, notwithstanding the income received by the Wife, the Husband shall do all things and sign all necessary documents to be listed as a guarantor for a mortgage held by the Wife in relation to the new property purchased in her sole name, and the Husband shall pay periodic sums which represent 100% of the contributions to a mortgage loan amount not exceeding $500,000 (which sum shall include stamp duty and the Wife’s moving costs) and which are to be no less than the minimum required by the relevant financial institution and shall be payable by the Husband until such time as the loan is paid out in full and the mortgage discharged. The Husband shall pay and is to be solely liable for and, shall indemnify the Wife as to strata levies, council rates and water rates and will pay these expenses as and when they fall due until such time as the loan is paid out in full and the mortgage discharged.

The court noted (at [44]):

Finally, maintenance orders can be made taking into account all of the financial and personal resources of a party and in the expectation that a financial resource might be resorted to in order to comply with the order (Beck & Beck (No. 2) (1983) FLC 91-318; Schokker & Edwards (1986) FLC 91-723).

The Full Court of the FCFCOA found that this was not a maintenance order because:

  • By including the words “notwithstanding the income received by the wife”, the parties endeavoured to oust the jurisdiction of the court to vary a maintenance order pursuant to s 83. It was not a maintenance order because it was intended to stay in place regardless of any change in the wife’s needs and the husband’s earning capacity;
  • The husband’s liability under the mortgage remained until the mortgage was paid off, so that liability could exceed the amount of property the husband received under the consent orders.

The Full Court decided that the order was not a property settlement order either, because:

  • The wife’s new property was not otherwise the subject of the consent orders but obliged the husband to undertake a financial burden in relation to that property. That obligation was not part of the orders dividing the remaining property between the parties.
  • Property under the FLA is limited to existing property (Stanford v Stanford (2012) FLC 93-518; [2012] HCA 52), and does not extend to property that might be received in the future even where that interest could be described as a financial resource. The husband’s obligations “were likely to be paid out of the husband’s future income stream including his receipt of any anticipated bonus payments”. Each of those was a financial resource which could be taken into account to justify the wife receiving a greater share of the existing property but not, in effect, to enlarge the pool of property available for division. The continuing obligation to pay the mortgage (and to act as guarantor) was so akin to him being required to borrow funds to enlarge the property pool as to attract the same principle. Financial resources which do not constitute property or future income, cannot be the subject of division under s 79 but they may be taken into account when determining what division of the property is appropriate. The court is not empowered to make an order against property which does not presently exist but could be brought into existence by the exercise of borrowing capacity (Walters & Walters (1986) FLC 91-733 at 75,344; Best & Best (1993) FLC 92-418 at 80,280).
  • The extent of the husband’s obligation was not and could not have been known at the time the orders were made. It was difficult to see how the court could come to a view that the orders were just and equitable because the final distribution of property was unknown.
  • In short, the order had the effect of creating a liability of a greater value than the existing property which is a course that cannot be followed under s 79.
  • The order did not work to alter the interests of the parties in their property but rather created an obligation which was separate to the division of that existing property.

The Full Court was satisfied that the trial judge erred in characterising the order as a property settlement order and making a series of enforcement orders. The appeal was allowed, the enforcement orders set aside and the enforcement application was dismissed.

In summary, legal practitioners should be cautious about mis-characterising interim orders as something they are not. Besides the consequent difficulties in enforcement, there is also the possibility of a party arguing that a different order should be made at the final hearing. In Harris & Harris (1993) FLC 92-378; [1993] FamCA 49 the Full Court of the Family Court pointed out (at [4]) that an interim or partial property order could be “reversed or adjusted if it is subsequently considered necessary to do so.” The writer is unaware of any case where this has occurred, but it is surely possible for the court at trial to re-characterise part or all of an interim property settlement order as interim maintenance. 

Backdating of maintenance orders

Making retrospective maintenance orders might seem to be a partial solution. These orders would enable debts incurred for living expenses to be repaid, savings to be replenished and items which otherwise would have been bought or replaced to be bought or replaced. However, spousal maintenance orders are generally not retrospective. 

A maintenance order under s 72 (s 90SF(1)) can be made retrospectively or varied or discharged retrospectively under s 83 (s 90SI), but it is difficult to find examples of cases where retrospective orders have been made. 

In Everett & Everett (2014) FLC 93-604; [2014] FamCA 152 the wife appealed against the trial judge’s refusal to back-date an order for adult child maintenance to the date of filing of the application. The Full Court confirmed that the time for the commencement of the order was a matter of discretion and precisely the type of matter on which different minds might differ widely without either decision being appellable. In Ming & Leong [2022] FedCFamC2F 973 the child maintenance order was backdated a little over 3 months, to the last day of the trial. In Ballantyne & Ballantyne [2015] FCCA 500 it was backdated to the filing date of the application. 

Back-dating of a periodic spousal maintenance order was refused in Strahan & Strahan (No 2) [2012] FamCA 248 as a lump sum had already been received by the wife which had not yet been categorised as property or spousal maintenance.

Spousal maintenance orders are, however, retrospectively reduced quite frequently. e.g. Tamberdun & Tamberdun [2010] FamCA 11 and Pitney & Pitney [2018] FamCA 996.

The reasons why spousal maintenance orders are not made with retrospective effect appear to be:

  • The primary purpose of spousal maintenance is to adjust for any disparity between the incomes or earning capacities of spouses based on their respective needs. 
  • Maintenance is for current or future needs, not past needs.
  • The respondent may be unable to pay a lump sum of arrears other than by using capital.
  • Whilst a maintenance order can give the applicant a lump sum (e.g. Vautin & Vautin (1998) FLC 92-827; [1998] FamCA 135), periodic payments are not generally intended to enable the applicant to accumulate capital.
  • The applicant will have “managed” without the maintenance and therefore finds it more difficult to demonstrate a need for a retrospective order. 

Rather than a retrospective periodic order, it may be easier to justify an order for a lump sum which can be used to pay off debts which have accrued for living expenses or for purchases which haven’t been able to have been made. Such a claim must be carefully drawn and well supported by evidence, as the court may be inclined to leave these issues to be resolved by the trial judge. 

Running a truncated hearing

It might be tempting to accept an early hearing date where there will be little or no opportunity to cross-examine the parties (i.e. a truncated hearing) rather than wait for a date when the court will have time to hear oral evidence. Interim maintenance hearings, unlike other interim hearings, usually include the cross-examination of the parties. A case which demonstrates the risks of truncated hearings is Holman & Bates (2022) FLC 94-103; [2022] FedCFamC1A 141. The wife appealed against orders discharging an order for urgent spousal maintenance. There were several reasons why the appeal was dismissed, but the limited opportunity given to the husband to dispute the wife’s calculations of his capacity to pay was one reason. 

Central to the wife’s argument was an exhibit created by her which purported to demonstrate discounts that ought to be applied to expenses claimed by the husband in his financial statement. It was said that after those discounts were applied, the husband had surplus income of $750 per week. However, the husband did not have an opportunity to dispute that document, except by way of his counsel’s submissions. In those submissions, it was asserted that the husband had not included in his financial statement the payment of his legal fees and repayment of a loan he had taken to pay previous legal fees. If those payments were ignored, the husband conceded a capacity of $261 per week; if they were included, it reduced to $111 per week. 

Justice Tree concluded (at [40]):

It was for the wife to satisfy the primary magistrate of the husband’s capacity to pay, and the state of the evidence was sufficiently unclear that it was certainly open to the primary magistrate to conclude as he did, namely that he could not “make definitive findings as to what surplus, if any, the husband has over income and expenditure”… 

Costs orders?

Although, under s 117(1) each party is normally expected to bear their own costs, non-compliance with the Rules and the overarching purpose carries the threat of costs orders being made against parties and/or legal practitioners. 

Parties are also to be encouraged “to seek orders that are reasonably achievable on the evidence” (Sch 1, Pt 1, Cl 1(4)(e)). Do threats of costs orders encourage respondents to agree to interim maintenance orders at an early stage? Are Calderbank offers worthwhile?

A useful example is Rasheem & Rasheem [2022] FedCFamC1F 248, which is also an illustration of the delays in finalising an interim maintenance application.

The interim decision was made by a SJR on 1 November 2021 following an application filed by the wife in a Response to Initiating Application on 6 July 2020. An order was made for the husband to pay periodic maintenance of $700 per week together with the joint mortgage payments, line of credit payments, strata building insurance, council rates, water rates, electricity accounts, gas accounts, telephone, internet and any other reasonable outgoings in respect of the upkeep and maintenance of the former matrimonial home, together with outgoings in relation to a motor vehicle driven by the wife and the premiums on the existing private health insurance policy for the family. The husband filed an Application for Review which was heard by Justice Altobelli on 21 November 2021 and judgment was delivered on 20 April 2022. Justice Altobelli said in relation to the delays (at [9]):

There has been regrettable delay in having the issue of interim spousal maintenance and consequential orders brought before the Court. The financial circumstances of the parties are complex and, as it turns out, the wife’s concerns about the husband’s disclosure is substantially vindicated.  The wife was put to enormous effort and cost in putting the material before the Court so that it could objectively make an assessment of the husband’s financial capacity; despite it being his legal obligation to put these matters before the Court. There has been also been delay in delivering these reasons for judgment. This partly reflected the complexity as identified, but also partly reflects the unfortunate reality of workload pressures.

The husband disputed that he had the capacity to make the payments required of him and strenuously denied the wife’s assertions that he had not fully and properly disclosed his financial circumstances to the court. He also said that she had not demonstrated why she was not presently working and reliant on government benefits. He alleged that the wife was a professional who was previously employed in a business owned by her father. He asked the court to draw an inference that the wife continued to work as a professional and was not declaring her income or alternatively inferred that she had the means and capacity to return to employment as a professional. Justice Altobelli commented that despite the permittable legal resources available to the husband there was no evidence to support the drawing of the inferences he asserted. By contrast, the wife’s case for interim maintenance was plausible. She was unable to support herself adequately by reason of her care for the two children of the marriage. He was satisfied that the wife needed maintenance.

The SJR had quantified the wife’s needs to be $700 per week. The aide memoire prepared on behalf of the wife correctly quantified the expenses payable by the husband pursuant to the order for the mortgage etc and secondly, attempted to quantify the wife’s own needs for periodic spousal maintenance. This quantified her needs at $1,000 per week but her counsel acknowledged that this provided her with a surplus of $180 per week, leaving a net position of $820 per week. Justice Altobelli found nothing unreasonable about any of the expenses claimed by the wife, some of which were modest when one considered that the child support paid by the husband was more likely than not insufficient to cover the needs and expenses of the children. Justice Altobelli rejected the implicit criticism of child-minding expenses in circumstances where the wife was not working and said the wife was entitled to have the benefit of some respite from caring for two very young children. In his experience $100 did not purchase many hours of child minding in any event. A measure of the reasonableness of the wife’s expenses was found to be a comparison to those of the husband.

If the husband was paying $820 per week by way of periodic maintenance, then the quantified expenses as identified in the wife’s aide memoire gave a total weekly liability of $2,323. The court agreed that the husband’s disclosure had been inadequate and noted that where the financial affairs are complex the more onerous the duty of disclosure and it should not be expected for the wife to trawl through his complex financial affairs to satisfy herself that he could not pay. The husband, before rebutting or minimising the wife’s case, ought to explain to the court why relevant financial matters were not properly disclosed to the court upon the wife bringing the husband’s failure to properly disclose an aspect of his financial affairs to the court’s attention. 

Justice Altobelli found that there were many unexplained aspects of the financial transactions of the husband, some of which could only be dealt with at a final hearing, but he was amply satisfied that the husband had the capacity to make the payments the SJR ordered him to make, and in fact had the capacity to make higher periodic spousal maintenance payments given the evidence presented on the review.

The Application for Review was dismissed and the order for spousal maintenance increased from $700 per week to $820 per week. 

Justice Altobelli in Rasheem & Rasheem (No 2) [2022] FedCFamC1F 666 referred to the delays in the hearing of the wife’s interim application for maintenance having been requested by both parties, but found that the husband’s non-compliance with his discovery obligations was the key reason. In this later judgment the husband was ordered to pay the wife’s costs on an indemnity basis for the interim hearing and the review, set at $133,641.20. Justice Altobelli summarised the wife’s arguments (at [18]) which he accepted:

The wife’s case outline filed 19 May 2022 comprehensively sets out the submissions made on her behalf in relation to costs. The wife contends that indemnity costs are payable but that the Court also has the option to order fixed lump sum costs. The key points made include: the complete failure by the husband to comply with any of the orders; his total lack of success at each relevant Court event; the clearly established need of the wife; the extraordinary effort on behalf of the wife to produce relevant evidence to the Court when it was not only the husband’s own material, but it was material that he was obliged to place before the Court; and his purported lack of understanding of his own financial records. Each of these key points is established on the material before the Court.

The reasons for costs being ordered on an indemnity basis are interesting, as in maintenance applications it is the applicant who must prove the respondent’s capacity to pay, not the respondent who must prove incapacity. Justice Altobelli emphasised the respondent’s non-compliance with his duty of disclosure, saying (at [33]):

On behalf of the wife it was contended that the special or unusual feature of this case was that the husband has put the wife to proof of his own financial position. That is entirely correct. Even though it was his legal obligation to do so, the Court only gained an insight into the true financial circumstances of the husband as a result of the wife’s forensic investigation and presentation of the evidence before the Court. This put her to enormous legal cost. Even when the wife produced the husband’s documents pursuant to subpoena, he offered alternative and implausible explanations of what the documents meant. The lack of clarity about the husband’s financial circumstances was only exacerbated by his solicitor’s explanation to the Court that even though the husband had not complied with Court orders, and even though the wife’s substantial costs were largely unpaid, his costs were being met by his family, which clearly suggests they are an important and significant financial resource available to him. No cogent submission was made against the making of an indemnity costs order in the circumstances of this case.

If Altobelli J is correct, then has the burden of proof for interim maintenance claims shifted, and are costs orders a more realistic threat than they were pre-1 September 2021?

It is notoriously difficult to obtain indemnity costs orders. For example, in Delisle & Mannion (No 2) [2023] FedCFamC1F 83, an indemnity costs order was sought by the wife based on her offer of settlement in a parenting case. Justice Schonell was not satisfied that there were circumstances justifying an indemnity costs order. Costs were ordered in accordance with the scale of costs prescribed by the Rules. The father was to pay 50% of the mother’s legal costs and disbursements of the proceedings as and from 15 November 2022.

The offer was outlined in a letter of 10 November 2022 from the mother’s solicitors, some 13 days before the commencement of the proceedings. Justice Schonell considered (at [36]) that in some respects, “the offer of settlement contained in the letter was on all fours with some of the orders made”, save that it included a request for the mother to relocate with the child. The relocation application was abandoned by the mother at the hearing. It did not form part of any final order made by the Court nor was it something that was addressed by the parties in their evidence.

The letter, however, also contained the following paragraph:

In the event your client agrees with some, but not all of the terms of our client’s offer of settlement, please let us know by identifying those parts which may be agreed and those which are not agreed. 

Justice Schonell considered (at [38]):

That paragraph makes it plain that the mother was open to some discussion about narrowing issues. The father for reasons best known to him did not enter into any discussion other than agreeing to an order that the child live with the mother. In my view, such approach carries with it risks. One such risk is that an order for costs may be made. I am satisfied that the mother was making a bona fide attempt to resolve the matter and narrow issues. There is no evidence that the father was.

Justice Schonell confirmed (at [40]-[42]):

The overarching purpose is reinforced by the Rules and the Central Practice Direction – Family Law Case Management (CPD), especially the core principles, including that parties must conduct the proceedings (including negotiations for settlement of the dispute) in a way that is consistent with the overarching purpose. In that respect, Core Principle 8 could not be clearer.

I am not satisfied that the father’s response to the mother’s offer is consistent with the overarching purpose of family law practice and procedure or the CPD. 

The mother engaged with the overarching purpose [SIC] there is no evidence that the father did.

Justice Schonell favourably quoted from the pre-September 2021 case of Warbrick & Warbrick (No 2) [2021] FamCAFC 101, (2021) FLC 94-030 at [9], where the Full Court of the Family Court held: 

That circumstances where a party makes an offer to settle “on terms consistent with the outcome” of, in that case, an appeal, may justify an order for costs on that party’s favour. Specifically, in that case, the Full Court held that “the compatibility of [the mother’s] offers of settlement and the outcome of the appeal justifies an order for costs in her favour”. 

It is submitted that the applicant made an offer to settle on terms more favourable to the respondent than the outcome that was ultimately reached. Had the respondent accepted the applicant’s offer, he would have achieved a far more favourable outcome in the proceedings. The applicant’s proposal would have seen an end to supervision after 2 years, 3 months and 18 weeks from the date of the orders. The final orders that were made result in supervision remaining in place until 2027.

The respondent made no genuine attempt to resolve matters. 

He then said (at [45]):

I am satisfied, having regard to all of the circumstances in this case, that there are circumstances that justify I depart from the provisions of s 117(1) of the Act that each party pay their own costs. I am satisfied that the mother should have some of her cost paid but not all of them. Had the father engaged in a negotiations [SIC] then a more favourable outcome may have been achieved. He did not even attempt to do so. In the exercise of my discretion, it is appropriate he contribute to some but not all of her costs and I assess his contribution to be 50 per cent of her costs. I will make an order that the father pay 50 per cent of the mother’s costs on a party/party basis from the date of rejection of her offer being 15 November 2022.

Although the application for indemnity costs failed, Delisle is notable as a costs order was made not because the wife “beat’ her offer, but because she was prepared to negotiate, and the husband did not do so which was inconsistent with his obligations under the overarching purpose and the CPD. 

Injunctions

If a respondent will not agree to an interim maintenance order at a First Court Event before a JR, then compromising with an injunction to keep the financial arrangements in place pending the hearing of the interim maintenance application, might be an option. It may also be an option to avoid the costs of the interim hearing by maintaining injunctions until the final resolution of the dispute. 

Section 114(1) is the injunction power with respect to matrimonial causes. The power with respect to de facto causes in more limited. Under s 114(1):

the court may make such order or grant such injunction as it considers proper with respect to the matter to which the proceedings relate, including: …

(e)  an injunction in relation to the property of a party to the marriage; or

(f)  an injunction relating to the use or occupancy of the matrimonial home. (bold added) 

Sole use and occupation orders are injunctions. They are often made in tandem with maintenance orders, either for the benefit of the party living in the home with the children, or for a party moving out of the home. It is appropriate to consider recent developments in the area. 

The basic principle is that a court should issue an injunction which gives a spouse exclusive use or occupation of the matrimonial home only with caution as it is a very serious matter to turn a person out of their home. The Full Court of the Family Court in Davis & Davis (1976) FLC 90-062; [1976] FamCA 38 listed relevant factors to consider (at [13]):

The criteria for the exercise of the power under s 114(1) are simply that the court may make such order as it thinks proper. The matters which should be considered include the means and needs of the parties, the needs of the children, hardship to either party or to the children and, where relevant, conduct of one party which may justify the other party in leaving the home or in asking for the expulsion from the home of the first party.

However, it is more frequent that the primary carer will stay in the home and the primary income earner will leave.

Sarto & Sarto [2022] FedCFamC1A 16 was a successful appeal by the wife against an order dismissing her application for sole use of a property of which she was the sole proprietor, but the husband occupied. On appeal, Justice Austin found (at [30]) that:

The wife is the sole legal proprietor of the property. At this stage, the husband has not proven an existing equitable interest in the property. The husband is well able to live elsewhere and, for the discretionary reasons already canvassed, he has not demonstrated it would be ‘proper’ to grant an injunction depriving the wife of her legal entitlement to possession of the property. An order should be made requiring the husband to immediately vacate the property and restraining his return to it. That will enable the wife to enjoy her existing legal rights.

Austin J’s statement of principle was referred to favourably by the Full Court of the Federal Circuit and Family Court of Australia in Kartal & Templeman [2022] FedCFamC1A 46. The Full Court held (at [53]) that:

unless and until spouses’ existing property rights are adjusted pursuant to [SIC] discretionary order made under the [Family Law] Act, their existing individual and joint property rights and interests are established according to common property law. Furthermore, unless restrained by an injunction made under s 114(1) of the Act, the spouses may each exert the full measure of their property rights against third parties and one another.

Now that the Full Court has upheld the statement of principle in Sarto and recognising that the principle seems to fit with the Stanford approach to the parties’ legal and equitable interests, there may be more applications for sole registered proprietors to have sole use of their property. This may in turn lead to more interim maintenance orders applications to enable the non-property owner to pay rent.

What lies ahead?

So, speculating as to what lies ahead:

  1. Perhaps there will be more costs applications for unreasonable approaches taken by respondents? Arguably, the FCFCOA was more lenient in ordering costs in the new regime than was proposed in the Rules and the CPD, and the court may take an increasingly tougher approach.
  2. There may be more successful reviews of refusals to grant priority interim hearings, particularly where not to hear it urgently would be procedurally unfair. Will they be successful or is Judge Young (in Walcott & Pane) an outlier?
  3. The dual highway will continue:
    1. Modest property pools – interim maintenance orders are more likely to be made;
    2. Larger property pools – private mediations and interim property settlement orders are more likely.
  4. JRs may be given the power to decide interim maintenance applications.

Currently, JRs only have the power to make an order for the spousal maintenance of a party to a marriage or the maintenance of a party to a de facto relationship, or urgent spousal maintenance, in limited circumstances. JRs can make these orders only if the order is:

  1. The order is:
    1. until further order;
    2. in an undefended proceeding; and 
    3. does not come into effect until at least 21 days after service on the non-appearing party; or 
  1. The order is made by consent of all parties.

They can also discharge, suspend, revive or vary a spousal maintenance order or an order with respect to the maintenance of a party to a de facto relationship, if:

  1. The order to be discharged, suspended, revived or varied is:
    1. until further order;
    2. made in undefended proceedings; and 
    3. comes into effect at least 21 days after the order is served on the non-appearing party; or
  2. The order is made with the consent of all the parties to the proceedings.

One of the recommendations of the Australian Law Reform Commission’s (ALRC) final report “Family Law for the Future — An Inquiry into the Family Law System” tabled in 2019 in relation to spousal maintenance:

Recommendation 18: The Family Law Act 1975 (Cth) should be amended so that: 

  • the spousal maintenance provisions and provisions relating to the division of property are dealt with separately under the legislation; and 
  • access to interim spousal maintenance is enhanced by the use of Registrars to consider urgent applications.

In relation to interim spousal maintenance, the ALRC said:

7.95 The available empirical data indicates that spousal maintenance, when it is ordered, is often considered only in the context of more formal legal dispute resolution, such as court processes. It is possible that difficulty with accessing courts where parties have been unable to reach agreement on maintenance has led to a decline in the number of orders, particularly for interim maintenance, given the time critical nature of that form of relief. Previous practice in the courts was for urgent interim spousal maintenance applications to be heard and determined by a Registrar, in a relatively fast and cost-effective way. Accordingly, restoring this practice could enhance access to interim spousal maintenance.

It is therefore possible that giving greater powers to JRs to decide interim and urgent spousal maintenance applications will be in the next tranche of family law reforms, which is expected to be tabled in Parliament later this year.

Conclusion

Unfortunately, there are no published statistics as to trends in the FCFCOA with interim maintenance applications. Anecdotally, post-1 September 2021, they are not being listed with the same urgency as pre-1 September 2021. 

Where the property pool is modest, interim maintenance applications are more likely to proceed to an interim hearing within a few weeks of the First Court Event. Where the property pool is larger, then the parties are more likely to be diverted to a private mediation (even if they had one before proceedings were issued) and injunctions and interim property settlement orders may be made rather that interim maintenance orders. This diversion seems consistent with the over-arching purpose and the CPD, so perhaps the system is working as it is meant to work. However, the parties who still need an interim hearing after an unsuccessful mediation may not agree, as they may feel their costs have unnecessarily increased. 

The interim settlements are not without risk, as interim property orders may be reversed, and the law has developed with respect to sole use applications. Even if the system is working as it is meant to work, these issues are changing the balance of power in some diverted cases.

In the future though, there may be opportunities to run more interim maintenance applications successful review applications, greater power to JRs and more frequent costs orders. The procedure and the law of the new regime are still developing, so there are likely to be more opportunities for parties to say: “Show me the money”.

© Copyright – Jacqueline Campbell of Forte Family Lawyers and Wolters Kluwer/CCH. This paper uses some material written for publication in Wolters Kluwer/CCH Australian Family Law and Practice. The material is used with the kind permission of Wolters Kluwer/CCH.

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