Joli v Joli [2004] VUSC 57; Matrimonial Case 002 of 2003 (14 June 2004)

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IN THE SUPREME COURT
OF THE REPUBLIC OF VANUATU
(Matrimonial Jurisdiction)

The Petitioner and the Respondent were married in Port Vila on 18 May 1992 and have three children as follows:-

The parties separated in about February/March 2002. Interim orders for access and maintenance were made by this Court on 17 April 2003. The marriage of the parties was dissolved by a Decree Absolute entered by this Court on 3 October 2003.

There remains outstanding to be resolved the question of division of matrimonial property and how that is to be implemented, final custody and access orders and maintenance orders.

As the Court of Appeal said in Daniel Joli –v- Patricia Joli Civil Appeal Case No. 11 of 2003 “the ownership and division of assets is to be determined according to ordinary principles of law and equity. The Court has additional powers to make an adjustment order applying the relevant provisions of the Matrimonial Causes Act (1973) (UK).”

“Depending on the length of time the parties have lived together, and their respective contributions the Court might reach a conclusion, as a matter of fact in the circumstances of the case, that matrimonial assets should be divided in a roughly equal fashion.”

The parties in this case do not contend that anything other than a 50/50 split of the matrimonial property is an appropriate course.

The evidence of Mrs. Joli (her married name is now Canny but I shall continue to call her Mrs. Joli for the purposes of this judgment) is contained in her three sworn statements of 23 March 2003, 4 March 2004 and 25 March 2004. The evidence of Mr. Joli is contained in his sworn statements of 23 June 2003, 24 March 2003 and 24 March 2004. I have considered those sworn statements carefully and also pay due regard to the evidence which has been given at the hearing and the cross-examination of each party which has taken place.

Effectively the matrimonial assets consist of a house at No. 2 Lagoon which was the former matrimonial home and in which the respondent Mr. Joli presently resides, a house at Mele, a Mitsubishi L200 pickup, a Quintrex boat and two outboards and boarting equipment, musical equipment used by Mrs. Joli in her entertainment activities, various personal belongings in possession of the parties, a Daihatsu Mira sold by Mr. Joli and a fibreglass boat also sold by Mr. Joli.

It is Mr. Joli who is in the possession of the bulk of the matrimonial property including the two houses, the pick up, the Quintrex boat and his own personal belongings. In addition Mr. Joli resides in the former matrimonial home without making payments on the outstanding mortgage since June 2003 which has caused the mortgage over that property to increase at a rate of approximately VT900 per month.

As far as matrimonial assets are concerned there has been some agreement and some dispute as to some of the values. Those assets may be summarised as follow:-

	Gaby Joli Valuation (VT)	Colin Joli Valuation (VT)	Mean Valuation (VT)

House @ No. 2 Lagoon 11/OD51/011	18,500,000	18,500,000	18,500,000
Mele House 12/0822/006	7,000,000	7,000,000	7,000,000
Mitsubishi L200 Pickup	1,100,000	1,100,000	1,100,000
Quintrex Boat 2 outboards & equipment	2,550,000 (AGJ 23/05/03 & 25/03/04)	900,000 (Vila Marine value)	1,725,000
Music equipment	750,000 (AGJ 23/05/03 & 25/03/04 para 38)	1,030,000 (CJ 23/06/03)	890,000
Personal belongings	862,000	545,000	703,500
Daihatsu Mira (sold by CJ)	300,000	300,000	300,000
Fibreglass Boat (sold by CJ)	500,000	500,000	500,000
	31,562,000	29,875,000	30,718,500

The “Mean Valuation” of the assets was a course suggested by counsel for the Petitioner who adopted such an approach where the parties were at odds as to the valuations. That situation only arose in relation to the Quintrex Boat, outboards and equipment, and the music equipment. I am of the view that the mean valuation approach is a proper one to adopt in these circumstances where the difference between the total valuations of each party only amounts to some VT1,687,000. In saying that, I accept that there was a valuation from Vila Marine as to the Quintrex boat and equipment but I do not accept that it had deteriorated to that extent. One of the difficulties in the Petitioner obtaining any independent valuation was caused by difficulties between the parties.

At one stage the respondent Mr. Joli had sought to exclude the Mele House from matrimonial property but that approach was not continued at the hearing and the respondent, properly in my view, conceded that the Mele House is part of the matrimonial property to be divided.

Counsel for the Petitioner sought to persuade the Court that the effect of the Respondent ceasing to make payments on the mortgage in relation to the matrimonial home at No. 2 Lagoon should result in a significant credit to the Petitioner. The analysis proceeded on the basis that as monthly repayments are VT122,000 per month and as the last repayment was made in June 2003 and as the Respondent was living in the house rent free without making any payments that the loss could be rationalized as follows. The balance as at 6 June 2003 being the date of last payment was VT9,310,249. Interest per month was approximately VT80,000 resulting in a monthly reduction in the principal of VT42,000 approximately, assuming the monthly payment VT122,000. If payment had been made up to date the principal would have been reduced by no less than eleven times VT42,000 being VT462,000 and the current balance should be VT8,848,249 approximately. As payments have not been made the principal has increased to VT10,199,435 as at 15 April 2004 with interest capitalized again at the end of April being VT90,000 leaving balance as at 1 May of VT10,290,000.

Thus by reason of the Respondent ceasing payments on the loan while continuing to reside rent free in the house there is approximately VT1,440,000 less equity in the property than there should be and the Petitioner’s loss would be half of that sum namely VT720,000. Counsel for the Respondent did not accept that method of calculation but did not propose any other viable alternative.

In addition from the evidence there is clearly VT500,000 outstanding on the Mele Property due by the Respondent to his sister and that needs to be taken into account.

It is my view that an analysis and summary in accordance with the mean valuation approach would be as follows:-

Music equipment VT890,000 2 Lagoon (net) VT8,300,000
Half personal belongings VT351,750 Mele (net) VT6,500,000

As I will mention below the Respondent also owes the Petitioner VT875,000 for school fees unpaid.

The Petitioner submits that a way of equalizing the matrimonial assets situation between the parties would be to transfer the respondent’s interest at the No. 2 Lagoon house to her including an order for him to vacate the property and for the property in the house currently there to remain there except for his personal belongings. That would still leave the Petitioner VT1,227,515 short of an equal half share.

There is still a difference of VT935,000 in the respondent’s favour and that does not take account of the petitioner’s submitted reduced equity of VT720,000 but that can be taken somewhat into account by the furniture presently, within the former matrimonial home.

On the other hand the Respondent submits that the Court could order the Respondent to pay the Applicant a sum to provide for her equal interest or similarly order that matrimonial home be transferred to the Petitioner with appropriate adjustments.

I might add that prior to this hearing the parties had negotiated a settlement of matrimonial property which effectively achieved division by transferring the former matrimonial property to the Petitioner but the Respondent at the last minute declined to sign the agreement although it had been agreed to in principle.

As to the appropriate course to adopt in achieving an equal division of matrimonial property I must take into account the fact that the Respondent ceased to pay the mortgage on the former matrimonial home, despite living in it, for 12 months. He was candid enough to admit in evidence that he could not afford to make those payments and I am of the view that should I adopt first course submitted to me by his counsel, namely him paying the Petitioner an appropriate sum to provide for her share, that is clearly beyond the present ability of the Respondent to service.

On the other hand the Petitioner and her new husband are prepared to take over the former matrimonial home and to refinance it with the bank. Such a course requires some formalities to be completed, such as approval of the bank to refinance and approval of the Minister for the transfer, but I cannot see that those issues are insurmountable and the course of ordering that the Petitioner take over the former matrimonial home and that the parties retain the other assets that they have is in my view the most realistic and equitable one in all the circumstances.

I am aware from the file and from my own dealings with the parties that access has proved to be a difficulty over the time that the parties have been separated since about February/March 2002. I am grateful to the parties for the good sense that they showed at the hearing in agreeing to terms of access. The question of custody is not in dispute as the Respondent agrees that the Petitioner should have permanent custody of the three children. The parties agreed that the Respondent should have access to the children on one night per week which on week days would the period from the closure of school on any one day to the return to school next morning. The one night at the weekend would be from 5 p.m. on one day to 5 p.m. on the next day. Such access would be on 24 hours notice by the Respondent to the Petitioner. In addition further access, again on 24 hours notice by the respondent was agreed for one additional afternoon per week from the closure of school to 6 p.m. on that day. In addition the parties agreed that the Respondent may have access to the children for half of each school holiday periods with notice to be given two weeks prior to the particular school holiday concerned. Both parties accept that they would use their best endeavours to ensure that future access visits are arranged without difficulty.

The Petitioner accepts that although maintenance payments have been irregular they are currently up to date. However, there remains the sum of VT875,000 outstanding by the respondent in relation to school fees ordered by the Court on 17 April 2003.

In her sworn statement of 23 May 2003 the Petitioner deposed that the monthly expenses of the children amounted to VT267,250. and she sought an increase of maintenance, not necessarily in that full amount, but was prepared to accept VT100,000 per month. During the course of hearing the Respondent was prepared to offer VT80,000 by way of monthly maintenance which figure would include payment for school fees, rather having that as a separate amount.

It is my view that the realistic sum for maintenance in all the circumstances is VT90,000 per month all inclusive and I direct that the Respondent pay the Petitioner that amount by way of maintenance of the children on the 18^th day of each month with the first payment to be made on 18^th June 2004. It is also clear that the respondent has not paid school fees of VT875,000 under the Order of this Court of 19 April 2003. That will be taken into account in the Order below.

The result of this case has effectively been the same as or similar to the agreement earlier proposed between the parties which, on the sworn statements, was agreed to but declined by the respondent at the last minute by letter of 9 February 2004. (see Exhibit F sworn statement of petitioner 4 March 2004.) With a degree of co-operation and common sense from the respondent this matter need never have been litigated. The petitioner has been put to added expense. That should be recognized in an award of costs. The respondent must pay costs to the petitioner at the standard rate from 9 February 2004 to the date of this judgment as agreed or as determined by the Court.

Supreme Court of Vanuatu

Joli v Joli [2004] VUSC 57; Matrimonial Case 002 of 2003 (14 June 2004)