Knight v Knight
| Jurisdiction | New Zealand |
| Judge | Osborne J |
| Judgment Date | 01 February 2022 |
| Neutral Citation | [2022] NZHC 62 |
| Docket Number | CIV-2021-409-415 |
| Court | High Court |
[2022] NZHC 62
Osborne J
CIV-2021-409-415
IN THE HIGH COURT OF NEW ZEALAND
CHRISTCHURCH REGISTRY
I TE KŌTI MATUA O AOTEAROA
ŌTAUTAHI ROHE
Family — appeal against an order for the payment of interim spousal maintenance to the respondent — jurisdiction to make successive interim orders — interim maintenance as a stopgap measure — importance of the level of a prior maintenance order — applicant's reasonable needs — consideration of the ability of each party to support themselves — standard of living of the parties — Family Proceedings Act 1980
P F Whiteside QC and B K Ferguson for Appellant
R L Powell and J Lucas for Respondent
Peter Whiteside QC, Christchurch
Rhonda Powell Barrister, Christchurch
The appeal was dismissed.
The appellant, John Knight, appeals against a judgment of the Family Court ordering the payment of interim spousal maintenance to the respondent, Mary Knight (the Judgment). 1
By the Judgment, Judge J K Hambleton ordered Mr Knight to pay Mrs Knight $17,000 per month from September 2021 to February 2022.
Mr Knight asserts, on five grounds, that the Family Court erred in fact and law. He asks this Court to quash the interim maintenance order and seeks costs.
Mrs Knight has filed a conditional cross-appeal. In the event this Court is satisfied that the interim maintenance order should be set aside, she seeks an order varying the interim maintenance payable for legal costs to $11,000 (to include a greater sum on account of interim maintenance for legal costs).
Mr and Mrs Knight are 40 and 35 years of age, respectively. They lived together from January 2010 to January 2020. They were married in December 2013 and have one child (born in March 2019). There is an interim parenting order in place whereby Mr Knight has care of the child from 9 am on Friday to 4 pm on Sunday (week 1) and from 9 am on Thursday to 4 pm on Friday (week 2).
The parties have before the Family Court applications for relationship property, maintenance and care of their child.
Under pt 6 Family Proceedings Act 1980 (the Act) the Family Court may make orders for spousal maintenance. Under s 82 of the Act an interim order of up to six months' duration may be made. The s 82 jurisdiction allows the Court to make more than one interim maintenance order. 2
Mrs Knight has obtained three such orders:
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(a) First order — in May 2020 Mrs Knight sought a monthly sum of $13,691.62. A consent order was made on 2 June 2020 for payment by Mr Knight of maintenance to Mrs Knight of $1,000 per week for 26 weeks from 25 May 2020. Additionally, a balance in the parties' joint bank account (approximately $17,000) was to be released to Mrs Knight. 3
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(b) Second order — in November 2020 Mrs Knight sought a monthly sum of $7,691.62 for her own maintenance and $11,000 per month for legal fees. A consent order was made in December 2020 requiring Mr Knight to pay maintenance of $1,000 per week for 14 weeks commencing 28 December 2020, and a $5,000 catch-up lump sum for five previous weeks. In addition, Mr Knight was ordered to pay a lump sum of $40,000 to Mrs Knight's solicitors. 4
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(c) Third order — finally, in March 2021 Mrs Knight sought a monthly payment of $8,096.93 for her own maintenance, a monthly payment of $7,000 towards her legal fees and a lump sum payment of $20,000 for the fees of a financial expert. Judge Hambleton heard the (third) application on 10 June 2021 and made the order referred to at [2] above and [10] below.
For the appellant, Mr Whiteside QC submitted the Family Court should not have made any further order because: 5
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(a) the court should have declined to make a third interim order;
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(b) there is no jurisdiction to order a lump sum payment;
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(c) Mrs Knight's needs did not justify an award in the sum sought;
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(d) Mrs Knight has not demonstrated reasonable efforts to find employment so as to meet her own needs;
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(e) Mr Knight's reduced income in the previous two years weighs against making such an order; and
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(f) the legal fees being charged to Mrs Knight are unreasonable and disproportionate to the issues in dispute.
The Judge ordered:
(a) Mr Knight was to pay to Mrs Knight interim spousal maintenance of $17,000 per month, ($8,000 for her maintenance; $7,000 for her interim legal fees; and $2,000 for her interim accountancy fees);
(b) payments were to commence on 6 September 2021; and
(c) payments were to continue for six months (finishing on 7 February 2022).
The Judge directed the Registrar to set down the hearing of the application for a final spousal maintenance order before 7 February 2022.
Mrs Knight's application was under s 82 of the Act, which provides:
82 Interim maintenance
(1) Where an application for a maintenance order or for the variation, extension, suspension, or discharge of a maintenance order has been filed, any District Court Judge may make an order directing the respondent to pay such periodical sum as the District Court Judge thinks reasonable towards the future maintenance of the respondent's spouse, civil union partner, or de facto partner until the final determination of the proceedings or until the order sooner ceases to be in force.
…
(4) No order made under this section shall continue in force for more than 6 months after the date on which it is made.
(5) An order made under this section may be varied, suspended, discharged, or enforced in the same manner as if it were a final order of the Family Court.
Judge Hambleton said the test under s 82 is what a Judge thinks is reasonable, with the cases turning on their particular facts. 6 She noted that an interim order lasts for six months and said it is a “stopgap measure designed to address any injustice or hardship which may arise between the time a substantive application is filed and the substantive hearing”. 7 The Judge observed that the decision as to what is reasonable involves a wide discretion and, as explained by Ellen France J in Tsoi v Hua, the Court is entitled to have regard to the statutory principles (set out in ss 62 to 66 of the Act). 8
The Judge noted that discretionary considerations in the assessment of an application for interim maintenance (arising from s 64 of the Act) include: 9
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(a) the reasonable needs of the applicant;
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(b) the ability of each party to support themselves, having regard to the division of functions within the qualifying relationship and the earning capacity of each party;
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(c) the responsibility of each party for the ongoing daily care of dependent children of the qualifying relationship;
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(d) the standard of living of the parties while they lived together;
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(e) any reasonable period of education/training undertaken by the applicant to be self-sufficient; and
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(f) any other relevant circumstances.
In relation to reasonable needs, the Judge referred to the observations of Kos J in Hodson v Hodson. 10 Her Honour noted also the adoption by Kos J in Hodson of the Court of Appeal's recognition in Ropiha v Ropiha that payment of a domestic purposes benefit is to be disregarded from the calculation of an applicant's means. 11
Judge Hambleton, referring to L v T [ Spousal Maintenance], recognised a respondent may be called upon to utilise capital to pay interim maintenance. 12
The Judge referred to the fact that interim maintenance is paid periodically (in contrast to spousal maintenance, where lump sum payments are permitted). 13
Finally, in terms of the principles, Judge Hambleton adopted four questions on which to base her analysis: 14
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(a) what can be identified as the applicant's reasonable needs and means?
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(b) what is the ability of the respondent to meet those reasonable needs?
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(c) in assessing the ability of the respondent to meet those reasonable needs, can capital assets be taken into account?
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(d) should judicial discretion be exercised to make an interim order?
Judge Hambleton noted Mrs Knight identified her reasonable needs as being met by a sum of $8,096.93 per month. The Judge said that the difference between Mrs
The Judge referred to Mrs Knight's evidence as to an affluent lifestyle the couple enjoyed during the relationship, with examples provided.
The Judge also had regard to Mrs Knight's assessment of the cost of living in the 2019 calendar year ($120,041.95 per annum or $10,086.83 per month), but noted the expenditure did not include accommodation costs and some other expenses (which were met by a trust or another related entity).
Judge Hambleton recorded Mr Knight had suggested annual expenses of $70,896 but noted that that did not appear to have been calculated by reference to records of actual expenditure and that Mr Knight had not denied the lifestyle standard referred to by Mrs Knight. The Judge accepted Mrs Knight's reasonable living needs were $8,000 per month.
The Judge next turned to consider Mrs Knight's pending costs of litigation.
Mrs Knight had provided a schedule showing the date and quantum of invoices of counsel. The Judge observed that the timely focus of...
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