Spousal maintenance child support departure

Spousal maintenance – Child support departure – Departure application was determined first – Administrative assessment departed from so as to add payment of school fees by husband – Order for interim spousal maintenance

In Anderson [2014] FamCA 766 (16 September 2014) Macmillan J heard the wife’ s applications for interim spousal maintenance and departure from an administrative assessment of child support. The wife worked part-time in education and the husband was a partner in a law firm. The parties had three children aged 12, 6 and 5 while the husband had a child of his current de facto relationship, aged 1. It had been jointly decided to send the children to a private school (para 5) and “during the marriage the wife’s parents paid half of the children’s school fees and expenses” (para 7).

The husband’s “profit share for the year ending 30 June 2014 was $711,000 gross” (para 38) while the wife’s income was $971 per week or about $50,000 per annum (para 48).

An order was made by consent on 4 February 2014 for payment of school fees and expenses by the husband. Macmillan J at para 11 expressed doubt as to the source of power for that order and said (at paras 17-18):

“ … whatever the husband’s intention may or may not have been at the time the orders were made, the order made 4 February 2014, which I am satisfied could only have been made pursuant to s 139 [an urgent maintenance order under s 139 of the Child Support (Assessment) Act made after an application had been made for an administrative assessment], ceased to have effect on 17 February 2014 when the assessment issued. I do not accept counsel for the wife’s submission that this is simply a case of non-compliance with s 125 of the Assessment Act and can be remedied under the slip rule.

It is, however, open to the wife to now seek an order for non-periodic child support … rather than, as had been assumed by both parties, the husband seeking to vary an already existing order for departure.”

Macmillan J continued (from para 21):

“The husband’s obligation to pay child support is a matter I must consider in determining what, if any, obligation he has to pay spousal maintenance. On that basis, both parties agreed that the appropriate course would be for me to determine the question of the child support payable by the husband and then determine the question of what, if any, spousal maintenance the husband ought to pay for the wife’s support.

[22] On this basis, the issues I must determine are as follows:

* whether there should be a departure from the child support assessment and, if so, how much should the husband pay for the children of the marriage and in what form; and

* what, if any, spousal maintenance the husband should pay and in what form.”

After referring to the “three-step process” for a departure application as identified in In the marriage of Gyselman and Gyselman (1992) FLC 92-279, the Court said (from para 27):

“The husband’s case is that he should pay the wife $5,000 per month or effectively $1,154 per week for the support of all three children. He also seeks orders directing how that payment or payments should be applied. Insofar as the current assessment requires the husband to pay $2,295 per month or almost $530 per week, this appears to be a concession on his part that a departure from the assessment is appropriate.

[28] The wife’s case is that the husband should pay the periodic payments he is required to make pursuant to the assessment and, in addition, pay non-periodic child support by way of the children’s educational expenses at L School, inclusive of all tuition fees including arrears, levies, uniforms, books, stationery, computer requirements, excursions and extra-curricular activities.

( … )

[49] … I am satisfied that the wife’s income is not sufficient to meet the reasonable needs of the children and that she requires the ongoing periodic child support payments from the husband to support the children. It is then a question of whether the husband can afford and should be required to also pay for the children’s education expenses and whether those education expenses or any part thereof should be substituted for periodic child support payments.

[50] Neither party is suggesting that the children should not attend L School. The husband’s case is predicated upon the wife paying half of the school fees. Given the wife’s income, she clearly could not afford to do so and that could only be on the basis of the wife’s parents paying her share. The wife’s parents do not have a legal obligation to do so.

[51] … allowing for all of the husband’s expenses, including the amount he says he spends on legal fees and disregarding the sum of $1,153 he says he is paying for educational expenses, the husband would have an excess of income over expenditure of approximately $1,683 per week. If I were to deduct the husband’s legal expenses of $1,615 per week that excess of income over expenses would be approximately $3,300 per week.

[52] I am satisfied that in all of the circumstances of this case it is both just and equitable that the husband be required to continue to make the periodic payments pursuant to the assessment together with an amount sufficient to meet the cost of the children’s educational expenses. I have in reaching that decision had regard to the matters set out in ss 117(4) and 117(5) of the Assessment Act, including but not limited to:

* the primary obligation of the husband and the wife to support the children;

* the respective financial circumstances of the husband and the wife and, in particular, the husband’s income which is by community standards substantial;

* the commitments of the husband and the wife to support themselves and, in the case of the husband, his new partner, their child and his partner’s child; and

* the needs of the children and, in particular, the manner in which the parties have chosen to educate the children.

[53] I am also satisfied, having regard to s 124 of the Assessment Act, that it is in all of the circumstances of this case both just and equitable and otherwise proper to make the order for the non-periodic payments sought by the wife in her initiating application.”

As to spousal maintenance, the Court said (from para 66):

“ … the wife sought interim orders ‘by way of spousal maintenance’ that the husband pay all principal and interest in respect of the loans secured by mortgage registered over the properties …

( … )

[90] The circumstances in this case are that there is an arrangement between the wife and her parents that they will take responsibility for the mortgage ‘come what may’ and it is only a question of timing. There is, in those circumstances, some artificiality about the wife’s application that the husband pay the mortgage payments or that she is unable to support herself adequately unless the husband makes those payments.

( … )

[92] Although I am not satisfied that it is either necessary for her adequate support or, for that matter, affordable for the wife to retain the former matrimonial home save and except as may be made possible by her parents, it does not necessarily follow that the husband does not have an obligation to contribute to her support.

( … )

[94] Based upon the figures in her financial statement the wife has a shortfall of approximately $367 per week. I am also mindful of the fact that, of necessity, some part of the wife’s expenditure, for example rates and house insurance, is referrable to the support of the children. I have however also had regard to the fact that the expenditure both the husband and the wife have identified in their financial statements, whether or not it was reflective of their standard of living during the marriage, may no longer be either realistic or sustainable.

[95] … Based upon a weekly income of $13,673 and after payment of income tax of an estimated $5,240 per week, and after payment of periodic – and non-periodic child support pursuant to the orders I propose to make – of approximately $1,672 per week, the husband will have approximately $6,761 per week to meet his ongoing weekly expenses. Those expenses, on the basis of his most recent financial statement, but excluding his legal fees and the amount he includes for the children’s educational expenses, are $5,134 per week.

( … )

[97] This is not and cannot be an exact mathematical exercise. ( … )

[98] Doing the best I can on the evidence before me and mindful of the fact that the orders I am asked to make are interim orders based upon untested evidence, I am satisfied that even without the obligation to make mortgage repayments or pay rent for alternative accommodation, the wife is unable to adequately support herself.

[99] I am also satisfied that the husband … has the capacity to contribute to the wife’s support and that it is proper in all of the circumstances that the husband pay the sum of $350 per week for the wife’s maintenance.”

A departure order was made to provide that in addition to the administrative assessment of child support the husband pay as non-periodic child support the children’s school fees and specified expenses and an order was made until further order that the husband pay the wife spousal maintenance of $350 per week.

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