Principal of Justice Family Lawyers, Hayder specialises in complex parenting and property family law matters. He is based in Sydney and holds a Bachelor of Law and Bachelor of Communications from UTS.
One Melbourne couple together spent over $225,000 over a 26-month period in Court disputing settlement of property from their 19-month long marriage.
This recent 2017 case showcases how bitter disputes between exes can blow up in court and waste time, money and dignity for the parties involved.
After a family law divorce, a former couple usually needs to sort out the division of their assets and debts.
When they cannot reach an agreement privately, a party will need to apply to the court for financial orders to resolve the dispute.
Nature of the Dispute
The couple was married for 19-months.
The asset pool from the marriage totalled over $1 million and was mostly contributed by the Wife’s family.
The asset pool consisted of several major items of property.
The first was the couple’s home, which was purchased by the Wife with $800,000 given to her by her mother.
Another was a franchise business run by the couple. It was initially purchased by a $300,000 advance from the Wife’s family.
The couple then sold the business for a $45,000 profit.
The last property in question was a luxury German car.
The division of the proceeds from the sale of the car, valued at $77,000, was the only real issue for determination by the court.
Again, the Wife’s mother had provided the couple $122,000 to purchase the car in question.
The Court also considered the Husband’s family contributions, which totalled $60,000. Part of this $60,000 contribution was used for the purchase of a Japanese car that was sold for $11,000 when the German car was purchased.
The Wife argued that she should keep all the assets above in question.
The Husband claimed he should receive the total $77,000 proceeds from the sale of the German car, as the car had been registered in his name.
How was the property divided?
In his judgment, Family Court Justice Johns found both parties had tried to mislead the court.
The Wife increased the length and cost of proceedings by creating and executing backdated documents which argued a claim that her mother’s contributions were in fact loans instead of gifts.
This claim was later abandoned.
On the other hand, the Husband misled the court in regard to his employment and income leading up to the family law divorce.
The final division of the property ruled Mr Bai would receive four percent of the asset pool-totalling $42,480.
This is roughly 55% of the total $77,000 car sale proceeds that he sought.
The Wife received the remaining $34,520 from the sale of the German car and the rest of the asset pool.
Justice Johns stated in his ruling that neither party was likely to be happy with the outcome as their contributions to the marriage had exceeded $1.2 million, but after the exorbitant legal fees, only $1,062,000 was left to be divided.
Comments made by the court
The steep legal fees and length of the dispute over, essentially, a single asset, compared to the length of the marriage was critiqued heavily by Justice Johns.
The legal fees ended up totalling $225,000.
The Wife, who is residing in Australia on a student visa, told the court her legal fees would amount to $160,000.
The $34,520 amount she received from the car sale ended up being almost five times less than her legal costs.
The Husband, who is also a student and a recent Australian citizen, was self-represented for much of the proceedings and informed the court his legal costs were $66,000.
Justice Johns stated that both parties showed such a high level of animosity towards each other that both preferred to expend significant sums on legal fees and devote more than two years of their lives to the family law divorce rather than resolve their dispute prior to trial.
It was claimed this bitterness meant ‘both parties gained nothing from the pursuit of this litigation’ and reflected poorly on the couple.
It is clear that the Family Court has little patience for cases in which a desire to bitterly battle out disputes in court override common sense and the commercial reality of the assets in question.