New South Wales District Court CITATION: Turton v Sheekey [2006] NSWDC 135 HEARING DATE(S): 22 November 2006 EX TEMPORE JUDGMENT DATE : 11/22/2006 JURISDICTION: Civil JUDGMENT OF: Sidis DCJ DECISION: 1. Orders in accordance with paragraphs 1, 2, 3, 4(a), 5, 6, 7, 8, 9, 13, 15, 16 to the exclusion of reference to the chicken shop, 17, 18, 19, 20 and 21 of the terms of settlement ; 2. The exhibits and affidavit material will be retained for twenty eight days. CATCHWORDS: DE FACTO RELATIONSHIP failure to co-operate on agreed sale of assets. PARTIES: Rachelle Joy TURTON David SHEEKEY FILE NUMBER(S): Newcastle 539/05 Plaintiff - Julia Clarke SOLICITORS: Defendant - self represented JUDGMENT HER HONOUR 1 In this matter the plaintiff, by amended notice of motion filed with the Court on 31 August 2006, asks the Court to set aside orders made in terms of settlement that were filed with the Court on 14 October 2005 and seeks substitution of orders in lieu thereof. 2 The proceedings arise out of a de facto relationship between the parties dating from September 2002 until September 2004. There is a child of the relationship, a daughter Sophie, who will be two years old in February 2007. 3 The evidence established that both parties had assets at the commencement of the relationship, the plaintiff claiming to have been in a net asset position of some $236,000, part of it being her own home with a small mortgage. The defendant claimed to have had assets at the commencement of the proceedings of about $500,000. 4 In the course of their relationship the parties jointly purchased a house at Lake Munmorah for the sum of $612,000. When they separated it was agreed that the house would be sold but that, I fear, was the last time the parties agreed upon anything. 5 There was much conflict in the evidence about what has occurred since the time of separation. The problem has arisen because at the time the terms of settlement were entered into it was anticipated that there would be a surplus on the sale of the Lake Munmorah property. The property was ultimately sold at auction by the mortgagee in July 2006 for the sum of $455,000. This price left a shortfall on the mortgage on the property of $90,000. 6 In addition to the mortgages registered against the title to the property money was raised for the purchase of the property by taking out a mortgage on the home owned by the plaintiff at the time of the commencement of the relationship. The plaintiff stated that she had been relying upon the anticipated surplus on the sale to assist in paying out this loan. In the absence of a surplus she seeks that the Court make orders against the defendant for the payment of 60 percent of the balance outstanding on the mortgage and also that he accept responsibility for the shortfall of $90,000 on the mortgage on the Lake Munmorah property. 7 The basis of that application is that the defendant, by his conduct, contributed in large measure to the shortfall in the anticipated return on the sale of the Lake Munmorah property. There is evidence before me which substantially supports this contention. 8 The real estate agent who was originally instructed on the sale, Ms Coltman, provided an affidavit dated 9 September 2005, in which she detailed the problems that she encountered in marketing the property. Amongst those problems were the condition of the property, at that time occupied by the defendant, as well as the difficulties she had in communicating with him and gaining access to the property for the purpose of showing it to potential purchasers. 9 I have in evidence a number of photographs which the plaintiff contends indicate the condition of the property at the time Ms Coltman was attempting to market it. The defendant states that these photographs are indicative of only one day when he was entertaining a group of friends. However, the evidence of Ms Coltman, which I accept, suggests that those photographs depict the general state of the property which was not only untidy but was also beer bottle littered and not cleaned. 10 The defendant, in cross-examination, conceded that he had not cooperated with the real estate agent at a time when he himself harboured a wish to purchase the property. His evidence was that he had made an offer to the plaintiff of $605,000 to purchase the property which she had rejected and that he had not cooperated whilst he harboured this wish to purchase the property at that price. 11 The evidence of Ms Coltman was that the prime period for the sale of a property was within three months of listing and it was during this prime period that she encountered the difficulties of which she gave evidence. 12 I am satisfied that the conduct of the defendant prevented the sale of the property during that three month period. 13 As to the alleged offer of $605,000, there is attached to the affidavit of Mr Sheekey of 25 October 2006, a letter marked "DS7" from the firm of solicitors O'Connor & Co to Burgess Foat who formerly represented the plaintiff, dated 3 May 2005. The letter, which is attached to the affidavit, is unsigned. The plaintiff denied that she had ever seen it and there is no evidence that it was ever forwarded to Burgess Foat. Aside from that it does not make an offer to purchase the property for $605,000. 14 It is also contended that the defendant hindered the sale of the property after the terms of settlement were signed in October 2005 to the point where the mortgagee ultimately foreclosed on the mortgage and arranged a mortgagee sale. The defendant denied that this was so. 15 Having regard to my assessment of the defendant's credit, I am inclined to accept the submission that he did not go out of his way to assist in the sale of the property after the terms of settlement had been signed. 16 All that to one side, the question is whether the adjustment of interests of the parties to this relationship demands that I make the orders sought by the plaintiff. 17 I do so taking into account the fact that her prospects of recovering some of her position as it stood at the commencement of the relationship were severely damaged by the defendant's conduct. I also take into account that she has responsibility for the custody of their child and for providing a home for the child. 18 Those orders include a request that I appoint the plaintiff as the trustee for sale of the defendant's property at 77 Main Road, Toukley. I note that the chicken shop business has apparently already been closed and accordingly orders in respect of that business would no longer be effective and will not be made. 19 I will make the order appointing the plaintiff trustee of the Main Road property in the event that the payments referred to in paragraphs 2 and 3 are not made. I do this because it appears that the defendant has taken steps to dispose of assets since the time of the entry of the terms of settlement and I harbour grave suspicions that the disposition of those assets has been directed at defeating the plaintiff's claim. 20 I make orders in accordance with paragraphs 1, 2, 3, 4(a), 5, 6, 7, 8, 9, 13, 15, 16 to the exclusion of reference to the chicken shop, 17, 18, 19, 20 and 21. 21 The exhibits and affidavit material will be retained for twenty eight days. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.