FEDERAL COURT OF AUSTRALIA Brennan v McGuire (No 2)[2011] FCA 148 Citation: Brennan v McGuire [2011] FCA 148 Parties: ROBERT GEORGE BRENNAN v GLENYS FREYA MCGUIRE File number: NSD 1147 of 2010 Judge: RARES J Date of judgment: 17 February 2011 Date of hearing: 17 February 2011 Place: Canberra Division: GENERAL DIVISION Category: No catchwords Number of paragraphs: 14 Solicitor for the Applicant: M Reid of Phelps Reid Counsel for the Respondent: The respondent appeared in person IN THE FEDERAL COURT OF AUSTRALIA AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY GENERAL DIVISION NSD 1147 of 2010 BETWEEN: ROBERT GEORGE BRENNAN Applicant AND: GLENYS FREYA MCGUIRE Respondent JUDGE: RARES J DATE OF ORDER: 24 FEBRUARY 2011 WHERE MADE: CANBERRA THE COURT ORDERS THAT: 1. On 31 March 2011, or such other time as is fixed by the Registrar, the parties shall attend at the Court in Canberra (the settlement appointment) and, subject to each party complying fully with his and her obligations in these orders, at that time: (a) the applicant (Mr Brennan) shall deliver to the respondent (Ms McGuire): (1) an executed transfer in registrable form of his entire right, title and interest in the property known as 14 Hobart Avenue, Forrest in the Australian Capital Territory (the property); (2) the certificate of title for the property; (3) all unpaid notices for rates, water and utility services in respect of the property in his possession; (b) Ms McGuire shall deliver to Mr Brennan: (1) an executed resignation as a director and secretary of Rob Brennan Facilitation and Training Services Pty Ltd (the company); (2) an executed transfer of all shares held by her in the company; (3) an executed assignment to Mr Brennan of all her rights against and interests in the company in all respects, including as trustee of the Rob Brennan Superannuation Fund (the fund); (4) an executed indemnity in his favour in respect of any unpaid notices referred to in order 1(a)(3); 2. At the settlement appointment: (a) Mr Brennan shall deliver to Ms McGuire: (1) a members statement as at that date in respect of the interest of Wayne Kaufline (Mr Kaufline) together with a bank cheque in that sum in favour of Mr Kaufline or to such superannuation fund or trustee as he shall have directed in writing on or before 1 March 2011; (2) executed indemnities in favour of Ms McGuire and Mr Kaufline in respect of any claim that the company may make against them or either of them as trustee of or in respect of the fund; (b) Ms McGuire shall deliver to Mr Brennan: (1) an executed resignation by Mr Kaufline as a director of the company; (2) an executed assignment to Mr Brennan of all Mr Kaufline's rights against and interest in the company; (c) Subject to order 3(b) below, Ms McGuire shall deliver to Mr Brennan a bank cheque or bank cheques in the total sum of $775,000 in his favour or in favour of any person he may have nominated in writing not later than 1 March 2011. 3. In the event that Mr Brennan or Ms McGuire fails to perform an obligation under orders 1 or 2 above: (a) the Registrar is appointed to and may prepare, settle the terms and sign any document that such party was ordered to sign and do all such things as are necessary to give effect to these orders; (b) if Mr Brennan fails to deliver a bank cheque in favour of Mr Kaufline pursuant to order 2(a)(1), Ms McGuire shall deduct the amount that would have been payable by the fund to Mr Kaufline from the sum payable by her under 2 and, in lieu shall cause: (1) a bank cheque for that sum payable to Mr Kaufline to be delivered to the Registrar who shall thereafter deliver that bank cheque to Mr Kaufline together with the executed indemnity referred to in order 2(a)(1) upon delivery by him or Ms McGuire to the Registrar of the documents referred to in order 2(b); (2) a bank cheque for the balance of the sum of $775,000 to be delivered to Mr Brennan; 4. Not later than 20 February 2011, or further order: (a) Mr Brennan and Ms McGuire shall sign, and authorise their respective accountants, superannuation funds and financial advisors to prepare and sign, all such documents as are necessary to enable: (1) each of them to prepare any outstanding tax returns; and (2) each of them and Mr Kaufline to prepare any outstanding superannuation returns; (b) failing compliance with order 4(a), the Registrar forthwith is appointed to and shall sign any such documents; 5. Not later than 30 March 2011 Mr Brennan shall deliver or cause to be delivered to Ms McGuire at the property, in good order and condition: (1) all her personal records and effects and those of her children (including Frith Brennan) and her family in his possession, custody or power; and (2) without limiting order 5(1), the pastoral theme tapestry, dressing gown, camera tape and table (provided that the table, if it has not been restored, may be delivered in the condition it is at the date of these orders) referred to in paragraph 1 of Mr Brennan's affidavit sworn 7 February 2011 and thereupon such items shall be the proper to Ms McGuire. 6. Mr Brennan pay 50% of Ms McGuire's costs of the proceedings as taxed. 7. Upon compliance with these orders all personal property in the possession, custody and control of Mr Brennan and Ms McGuire respectively shall vest in interest and possession in him and her respectively. 8. Upon compliance with these orders by the parties, neither will have any right against, or liability to, the other in respect of the fund, the company or any interest in any real or personal property for which he or she would have been entitled to make a claim in these proceedings. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY GENERAL DIVISION NSD 1147 of 2010 BETWEEN: ROBERT GEORGE BRENNAN Applicant AND: GLENYS FREYA MCGUIRE Respondent JUDGE: RARES J DATE: 17 FEBRUARY 2011 PLACE: CANBERRA REASONS FOR JUDGMENT (REVISED FROM THE TRANSCRIPT) 1 On 21 December 2010, I delivered my reasons for adjustments that I considered appropriate to be made to finalise the financial relationship between the parties to the proceedings: Brennan v McGuire [2010] FCA 1443. I ordered that the parties prepare and exchange short minutes of orders to give effect to those reasons, and I identified, at [134], orders of the nature that I considered to be appropriate for that purpose. Rather than comply with those orders, each of the parties prepared competing versions of orders that dealt with matters well beyond the reasons that I had given. 2 I then caused to be sent to the parties, on 7 February 2011, draft orders that I prepared, having regard to those orders which each had drafted, to the extent they were appropriate, for the purposes of finalising the parties' financial and other relationships so far as possible once for all. I propose to make orders to the effect of that draft subject to a few minor variations that have been raised and discussed by the parties today. 3 A vital purpose of orders that should be made under the Domestic Relationship Act 1994 (ACT) is to give effect to s 14. That requires the Court to make orders that will end the financial relationship between the parties to the failed domestic relationship and avoid further proceedings between them. The orders that my earlier reasons contemplated were intended to achieve that end. 4 The history of this matter, since they separated, unfortunately, has suggested that the parties are not prepared to engage with each other in a sensible way, unlike their successful and productive partnership beforehand. Hence, the form of my orders specified what they must do. 5 Mr Brennan argued that any orders I should be minded to make ought to take effect at some future time rather than now, so that no property interests will be affected until the parties have had an opportunity to file a notice of appeal and to apply for a stay to suspend the operation of those orders. I do not propose to vary my draft orders for this purpose. Mr Brennan argued that the adjustment of $775,000 in his favour should be payable to him not to a superannuation fund as the draft orders suggested. I agree. 6 Ms McGuire argued that she should not be ordered to assign her interests in or in respect of the company, particularly in her capacity as a creditor. She claimed to be owed a debt of $9,717.75 that the liquidator had admitted to proof that she did not want to be assigned to Mr Brennan. 7 The company was an integral part of the parties' financial relationship. I intended that Mr Brennan take sole control of the parties' interests of all kinds in the company as part of his entitlement and that any rights Ms McGuire had against it should be assigned to him so as to disentangle her from what will be his asset, subject of course to the liquidation. 8 Both parties complained about the time my draft orders had allowed them to obtain final information as to Mr Kaufline's interest in, or debt due to him by, the superannuation fund. The orders I foreshadowed offered a means for him to be extricated from further involvement in the parties' financial affairs. If Mr Kaufline chooses not to co-operate, I have provided, so far as possible, that once his financial position in relation to the superannuation is ascertained, he will deal with his sister, Ms McGuire, for any debt or interest previously due or held by the superannuation fund to or for him. Obviously, it would be desirable for all three adults to co-operate and rationalise the present chaotic state of the superannuation fund's affairs in a sensible and practicable manner. 9 Ms McGuire argued that Mr Brennan could not be ordered to cause the personal property specified in the draft orders to be returned to her at the Forrest property because of a domestic violence order. I reject that argument. How he causes the property to be returned is a matter for him but he is not required personally to attend at the property. 10 Ms McGuire also sought that he deliver other items. However, there is no reliable evidence that he has them and the bickering must stop. I refuse to make a wider order. 11 Mr Brennan argued that a small claims tribunal had vested a table, that was an heirloom of Ms McGuire, in him and this Court had no power to readjust the property rights in that item. I reject that argument as without substance. At the moment, if the table is his property, s 15(1) and (2) of the Act give the Court power to adjust his interest in it by making it Ms McGuire's property as I will order it to be. 12 Ms McGuire sought immediate payment on settlement of her entitlement to 50% of her costs. Those costs will have to be ascertained on a taxation, there being no realistic possibility of agreement between the parties as to their amount. She also argued that Mr Brennan might not pay those costs when taxed. I do not propose to make any further order in relation to the ordinary operation of an order for costs of this kind. 13 Next, Ms McGuire complained of the draft order that provided for the parties, upon their compliance with the order, to have no further rights against or liability to the other in respect of the superannuation fund, the company or any interest in real or property for which he or she would have been entitled to make a claim in these proceedings. She asserted that the Court had no power to take away other rights. I reject that argument. The proposed order utilises the Court's powers under s 15 of the Act, in a plenary way to achieve its object expressed in s 14. The parties carried out their complex financial relationship through, among other vehicles, the company and the superannuation fund. That extended web of relations is all part of the matter the subject of these proceedings under the Act. 14 I will make the orders in the form I have indicated after the argument this morning. I certify that the preceding fourteen (14) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Rares. Associate: Dated: 24 February 2011