Ackerman & Ackerman
[2013] FMCAfam 109
•20 February 2013
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| ACKERMAN & ACKERMAN | [2013] FMCAfam 109 |
| FAMILY LAW – Children & Property – final arrangements for care of children aged 11 & 9 – presumption of equal shared parental responsibility – allegations of family violence – nature of family violence – substantial and significant time – nature of parental relationship – best interests – assessment of contributions to property pool – weight to be given to initial contribution of property – marriage in excess of ten years in duration – assessment of section 75(2) factors – just and equitable. |
| Family Law Act 1975, ss.4AB, 60B, 60CA, 60CC, 61DA, 65DAA, 65DAC, 65DEA, 75(2), 79, 79(4)(c) |
| B v B: Family Law Reform Act 1995 (1997) FLC 92-755 Russell & Russell & Anor [2009] FamCA 28 MRR v GR [2010] HCA 4 Lee Steere v Lee Steere (1998) FLC 91-626 Ferraro v Ferraro (1993) FLC 92-355 Clauson v Clauson (1995) FLC 92-595 Hickey v Hickey & Attorney-General of the Commonwealth of Australia (Intervenor) (2003) FLC 93-143 Biltoft & Biltoft (1995) FLC 92-614 Pierce & Pierce (1999) FLC92-844 Russell v Russell (1999) FamCA 187 Waters & Jurek (1995) FLC 92-635 Stanford & Stanford (2012) HCA 52 Baranski & Baranski (2010) FMCAfam 918 In The Marriage of Patsalou (1994) 18 Fam LR 426 Blanch v Blanch & Crawford (1999) FLC 92-837 H v W (1995) FLC 92-598 R & R: Children’s Wishes (1999) 25 Fam LR 712 Ferraro & Ferraro (1992) 16 FamLR 1 C & C (2005) FLC 93-222 Rosati v Rosati (1998) FLC 92-804 L & L (2006) FLC 93-254 |
| Applicant: | MR ACKERMAN |
| Respondent: | MS ACKERMAN |
| File Number: | ADC 2024 of 2011 |
| Judgment of: | Brown FM |
| Hearing dates: | 27, 28 & 29 November 2012 |
| Date of Last Submission: | 29 November 2012 |
| Delivered at: | Adelaide |
| Delivered on: | 20 February 2013 |
REPRESENTATION
| Counsel for the Applicant: | Ms Lewis |
| Solicitors for the Applicant: | Weatherley & Associates |
| Counsel for the Respondent: | Ms Ross |
| Solicitors for the Respondent: | Minney & Associates |
ORDERS
Children
The parties have equal shared parental responsibility for the children of the marriage [X] born [in] 2001 and [Y] born [in] 2003 (hereinafter referred to as “the children”).
In the exercise of this equal shared parental responsibility for the children the parties are to consult with each other in respect of all major long term decisions pertaining to the children, which include but are not limited to, issues concerning the following:
(a)The children’s education (both current and future);
(b)The children’s religious and cultural upbringing;
(c)The children’s health and any special needs;
(d)The children’s names; and
(e)Any changes to the children’s living arrangement, which significantly interferes with the operation of these orders, particularly with the specific arrangements for the children to spend time with each parent.
The wife and husband shall:
(a)Keep the other parent informed at all times of his/her residential address and contact details, including mobile and landline telephone numbers and email address;
(b)Keep the other parent informed of the names and addresses of any treating medical or other allied health practitioner who treats the children and authorise such practitioners to provide the other parent with information that they (the applicable medical or other allied health practitioners) are lawfully able to provide about the children; and
(c)Inform the other parent as soon as is reasonably practical of any medical issue, significant health issue or significant illness or injury suffered by the children. This order authorises any treating medical practitioner to release details of the children’s medical condition and/or injury to the other parent.
The parents authorise by this order, the school, attended by the children to give each parent information about the children’s educational progress and other related activities and supply them with copies of reports, photographs, certificates and awards obtained by the children (at the expense of the parent requesting same).
Each parent is at liberty to attend at the children’s school, pre-school or kindergarten for all events that are routinely attended by parents, including parent-teacher interviews, sports days and concerts.
The children live with each parent during school terms as follows:
(a)With the father:
(i)In one week of each fortnight from the conclusion of school on Thursday to the commencement of school the following Monday;
(ii)In the other week of each fortnight, from the conclusion of school on Wednesday to the commencement of school the following Friday;
(b)With the mother at all other times.
The children shall spend time with each of their parents during the short term school holidays (being from the first Monday of the holiday period until the commencement of the school on the Monday of the new term) as follows:
(a)With the mother for the first week from the first Monday of the holiday period until the second Monday of the holiday period.
(b)With the father for the second week from the second Monday of the holiday until the Monday of the new school term.
The children spend time with their parents during the Christmas school holiday (being from the first Monday of the holiday period until the Monday of the commencement of the new school term) periods on a week about basis
The children shall live with the mother at Christmas as follows:
(a)From 6.30pm Christmas Eve until 3.00pm on Christmas Day in the year 2013 and each alternate year thereafter, and
(b)From 3.00pm Christmas Day until 6.30pm Boxing Day in the year 2014 and each alternate year thereafter.
That the children shall live with the father at Christmas as follows:-
(a)from 3.00pm on Christmas Day until 6.30pm on Boxing Day in the year 2013 and each alternate year thereafter, and
(b)From 6.30pm on Christmas Eve until 3.00pm on Christmas Day in 2014 and each alternate year thereafter.
The children shall live with the father for New Year period as follows:-
(a)From 11.00am on New Year’s Day 2014 until 11.00am on 2nd January in the year 2014 and each alternate year thereafter.
(b)From 4.00pm on New Year’s Eve 2014 until 11.00am on New Year’s Day in the year 2015 and each alternate year thereafter.
The children shall live with the mother for New Year period as follows:-
(a)From 11.00am on New Year’s Day 2015 until 11.00am on 2nd January in the year 2015 and each alternate year thereafter.
(b)From 4.00pm on New Year’s Eve 2013 until 11.00am on New Year’s Day in the year 2014 and each alternate year thereafter.
The children shall live with each of the parents for the Easter long weekend as follows:-
(a)In 2013 and each alternate year thereafter with the father from the conclusion of school on Maundy Thursday or 3.00pm if a non school day until 3.00pm Easter Saturday and with the mother from 3.00pm Easter Saturday until 9.00am the following Tuesday and each alternate year thereafter;
(b)In 2014 and each alternate year thereafter with the mother from the conclusion of school on Maundy Thursday or 3.00pm if a non school day until 3.00pm Easter Saturday and with the father from 3.00pm Easter Saturday until 9.00am the following Tuesday and each alternate year thereafter.
The children shall spend time with the parent that does not have the children living with them on the child’s birthday and their respective birthdays as follows:-
(a)If a school day from the conclusion of school until 6.30pm, and
(b)If a non school day from 12.00pm until 5.00pm.
In the event the children are with the father on Mother’s Day the children shall spend time with the mother from 6.00pm on the Saturday before Mother’s Day until the children are returned to school on Monday morning provided that in the event that the children are with the mother on Father’s Day the children spend time with the father from 6.00pm on the Saturday before Father’s Day until the children are returned to school on Monday morning.
The parents will not remove the children from the State of South Australia, either interstate and overseas without providing the following relevant details to the other parent;
(a)Departure/return dates
(b)Flight numbers or details as to other modes of travel
(c)Address and phone numbers of where the children will be staying overnight;
And that such information be provided either 14 days prior to interstate travel or 28 days prior to overseas travel and that written consent from the other parent be obtained with regard to overseas travel.
Each party shall allow the children to reasonably communicate with the other parent when they are in their respective care and shall facilitate the same.
Each parent shall be at liberty to contact the children by telephone each evening before 8.00pm whilst the children are in the other parent’s care.
The parents shall communicate with each other by telephone, email or text message and that any significant departure from the Orders shall be expressed in writing and provided to the other parent clearly setting out the departure and the terms of the agreement a minimum of 7 days prior.
In the event that the children are invited to a party or other special occasion at a time when the children are spending time with the other parent then the mother or father as the case may be shall forthwith upon receiving such an invitation provide the other parent with a copy of such an invitation to enable the other parent to respond to the invitation as they may choose.
In the event that either parent travels with the children outside of the [W] district for a period exceeding 24 hours the parent shall advise the other of same by text message prior to departure.
In the event that handover does not occur at the children’s school that the handover be at a mutually convenient location as agreed between the parties and where no agreement can be reached at a location halfway between the parent’s respective places of residence
Property
Within thirty five (35) days of the date of these orders the wife pay to the husband the sum of $128,000.00.
Contemporaneously with the payment referred to in order 22 above, the husband transfer to the wife the whole of her right, title and interest in respect of the property known as and situate at Property D, [W] in the State of South Australia and being the land more particularly described in Certificate of Title Register Book Volume [omitted] (hereinafter referred to as “the former matrimonial home”).
Upon the transfer of the former matrimonial home from the husband to the wife pursuant to order 23 the husband and wife shall forthwith discharge the mortgage secured against the property and the wife shall keep the husband indemnified in respect of such mortgage and all other outgoings and liabilities in respect of the former matrimonial home.
Contemporaneously with the payment referred to in order 22 above the husband and wife do all acts and sign all documents necessary to transfer to the husband, at his sole expense, all the wife’s rights, title and interest in the property situate at Property A in the State of South Australia and more particularly described in Certificate of Title Register Book Volume [omitted] (hereinafter referred to as “the investment property”).
Upon the transfer of the investment property from the wife to the husband pursuant to order 25 hereof the husband and wife shall forthwith discharge the mortgage secured against the property and the husband shall keep the wife indemnified in respect of such mortgage and all other outgoings and liabilities in respect of the former matrimonial home, including any capital gains tax arising from any subsequent sale of the property by the husband.
Pursuant to section 90MT(4) of the Family Law Act 1975 a base amount of $35,000.00 be allocated to the wife in respect of the husband’s superannuation interest in the Construction & [B] Superannuation Fund (“hereinafter referred to as “[C] Superannuation Fund”) and that pursuant to section 90MT(1)(a) whenever a splittable payment becomes payable in respect of that interest, the wife is entitled to be paid the amount to be calculated in accordance with the Family Law (Superannuation) Regulations 2001 in respect of that base amount and there is a corresponding reduction in the entitlement of the husband.
The Trustee of the [C] Superannuation Fund, the husband and the wife in accordance with the Family Law (Superannuation) Regulations 2001 shall do such acts and things and sign all such documents as may be necessary to calculate the payment entitlements of the wife in accordance with order 27 hereof (1 up) have effect from the operative time, which shall be thirty-five (35) days from the date of these orders.
Including but without limiting the effect hereof, the husband shall retain for her sole use and benefit absolutely free from any further claim or demand of the husband:
(a)the furniture and furnishings in her possession, power and control.
(b)any motor vehicle in her possession.
(c)savings, shares and investments in her name.
(d)any superannuation entitlement, long service leave, annual leave or other work related benefits.
(e)personal effects.
(f)any other real and/or personal property and/or financial resources of the husband or in the husband’s name and/or possession not otherwise specified herein.
(g)all monies standing in the bank account relating to the family trust established by the parties during the course of their marriage.
Including but without limiting the effect hereof, the wife shall retain for her sole use and benefit absolutely free from any further claim or demand of the husband:
(a)the furniture and furnishings in her possession, power and control.
(b)any motor vehicle in her possession.
(c)savings, shares and investments in her name.
(d)any superannuation entitlement, long service leave, annual leave or other work related benefits.
(e)personal effects.
(f)any other real and/or personal property and/or financial resources of the wife or in the wife’s name and/or possession not otherwise specified herein.
All applications be otherwise dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Ackerman & Ackerman is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT ADELAIDE |
ADC 2024 of 2011
| MR ACKERMAN |
Applicant
And
| MS ACKERMAN |
Respondent
REASONS FOR JUDGMENT
Introduction
These proceedings relate to final arrangements for children and the division of property, following a marriage of approximately ten years in duration.
The applicant in the proceedings is Mr Ackerman “the husband”; the respondent is Ms Ackerman “the wife”. They are the parents of two children – [X] born [in] 2001 and [Y] born [in] 2003.
When the husband commenced these proceedings, in mid-2011, it was his position that [X] and [Y] should be parented in what is commonly called a shared care arrangement, moving between their parents’ respective homes on a week about basis; with the children’s times, on special occasions, being apportioned equally between the parties.
The wife’s position was, until mid way through the evidence at final hearing, that [X] and [Y] should live predominantly with her and spend time with their father for a block of four days, from after school on Thursday until 7:30pm the following Sunday during one week of each fortnight of school terms and two afternoons in the other week from after school until 7:30pm, so that the father and children could have an evening meal together. She also proposed that school holidays and special occasions should be divided equally.
Both parties have altered their positions since the proceedings began. However, one aspect of the case has never changed. Both parties agree that they should have equal shared parental responsibility for [X] and [Y] [Family Law Act section 61DA].[1]
[1] In these reasons for judgment legislation references in [ ] refer to the Family Law Act 1975
Accordingly, pursuant to the applicable legislation, the court is mandated to consider the children spending firstly equal time and secondly substantial and significant time with each of their parents [section 65DAA].
The mother has now abandoned the aspect of her proposal dealing with the children spending two evenings per week, in the second week of each school term fortnight, for the purposes of [X] and [Y] having dinner with their father.
In lieu thereof, she proposes that the children spend one overnight period, in the second fortnight, from after school until school recommences the following day with their father, in addition to the lengthier block of time in the preceding week of the fortnight.
For his part, the husband has abandoned his proposal that the children should live week about with each of their parents, during the school term. Rather, he proposes that the children should live with him from the conclusion of school on Thursday to the commencement of school the following Monday, in the first week of each fortnight and in the other week from the conclusion of school Wednesday to the commencement of school the following Friday.
This equates to six nights per fortnight during the school term. It is also the arrangement, which has been in place formally since 6 July 2011, when the parties’ competing applications first came before the court. On the other hand, the wife’s position equates to around five evenings per fortnight.
Accordingly, both parties’ respective positions envisage the children spending substantial and significant periods of time with each of them. Thus, in a temporal sense, there is not a great divergence between them. However, the parties have very different views about the nature of [X] and [Y]’s relationship with their father and this was the most significant factual issue at large in the hearing before the court.
This issue turns on the nature of the husband’s personality. The wife categorises him as a controlling and dictatorial person, who lacks empathy for the emotional needs of the children. Essentially, it is the wife’s position that the children are frightened of their father and are apprehensive about spending time with him, no matter how much support she provides them.
Although he accepts that he is a person of “old fashioned values” and reacted badly to the end of the parties’ marriage, with regrettable consequences, the husband denies that he is the controlling person portrayed by the wife.
Rather he would say that he merely wishes to continue to play a meaningful parental role in the lives of the children. He is concerned that Ms Ackerman has a propensity to enlist the children to provide emotional support for herself and this is the genesis of any reluctance which they may have demonstrated to their mother in respect of spending time with him.
The parties finally separated, in difficult circumstances, on 20 September 2010. For a period of about a month thereafter, they lived separately under the one roof of their former family home situated at Property D, “the Property D property”. This was an emotionally fraught period of time for all concerned, including [X] and [Y].
On 22 October 2010, the husband moved out of the Property D property and into an investment property, owned by the parties, situated at Property A “the Property A property”. He continues to live there, although ultimately he wishes it to be sold. In the longer term, he wishes to buy a property, in [W], which will be suitable for [X] and [Y] to spend significant periods of time living with him.
Property A and Property D are reasonably proximate to one another in [W]. In the aftermath of the parties’ separation, Mr Ackerman wished to be as fully involved in care arrangements for [X] and [Y]. He does, however, concede that, during the parties’ marriage, parental responsibility for the children has fallen more on the wife’s shoulders than on his, as he had been the family’s principle bread winner.
Mr Ackerman is an [omitted] by occupation. Until recently, he worked in his family’s business in [W]. He now works at [O] in [W]. Before the parties’ marriage, they agreed that they would divide their family responsibilities along traditional lines. Mr Ackerman would provide financially for the family, whilst Ms Ackerman would be engaged primarily in home duties. Mr Ackerman acknowledges that
Ms Ackerman is an excellent parent.
The wife is not so complimentary about Mr Ackerman’s parenting skills. She characterises him as being essentially disinterested in [X] and [Y]’s care, during the marriage, leaving all their care arrangements to her, along with the responsibility for performing the entirety of the housework concerned in their family home.
Although the wife falls short of asserting that Mr Ackerman has ever physically assaulted her, she characterises him as a domestic tyrant, who required her to meet oppressively high standards in terms of the performance of her housework responsibilities and who isolated her socially from her friends.
It is also her position that the husband was intolerant of the children’s normal exuberance and had difficulty controlling his temper when angered or stressed. Accordingly, she asserts that the children are anxious in their relationship with their father and frightened of not living up to his unreasonably high expectations of their behaviour.
Ms Ackerman characterises herself as having a docile and compliant disposition. As such, it is her case that the husband was able to control her behaviour by means of her own domineering personality and her own submissive character made her amenable to such control. She deposes as follows:
“… when the husband came home from work he would ask me what I had done that day. I would list all the things that I had done. He wouldn’t ask me how my day was. The husband would look at me in a stern way which would show his disappointment in me. This would make me feel guilty even though there was nothing to feel guilty for. I knew when he gave me that look that I would have to work really hard in the house to make up for whatever it was that the husband thought I had done. If I didn’t he would not speak to me.”[2]
[2] See wife’s affidavit of evidence filed 12 April 2012 at paragraph 62-63
The wife asserts that the husband’s persistent mode of behaviour towards her, during their marriage, satisfies the definition of family violence contained in section 4AB of the Family Law Act in that it is behaviour that has coerced or controlled her.
In this regard, she places particular emphasis on the husband’s behaviour towards her, whilst they were separated under the one roof, in September/October 2010. Ms Ackerman also asserts that
Mr Ackerman has stalked her following separation.
Mr Ackerman acknowledges that he behaved badly, when the wife informed him that the marriage between the parties was over. Although he accepts there can be no excuse for his behaviour on this occasion, he would categorise it as situational violence, stemming from the emotional stress of the situation in which he found himself. He denies having stalked the wife or that he is an inherently violent person.
A period of around eight months elapsed between the time of the parties’ final separation and the commencement of the current proceedings. During this period, an arrangement evolved whereby [X] and [Y] spent four nights of one fortnight with their father and two nights the following week. The rationale of this arrangement was that both parties felt that the children missed the other parent concerned, if separated from him or her for a period in excess of four nights.
The husband asserts that he began the proceedings because he wished to have a shared care regime for the children, which he believed would be the most stable arrangement for them. In response, the wife raised concerns regarding which she saw as the instability of the regime. She suggested she had only agreed to it against her better judgment, in the face of the husband’s forceful personality.
Notwithstanding her concerns, on 6 July 2011, the wife formally assented to orders, which saw [X] and [Y] living with their father from Thursday afternoon to Monday morning in the first week of the school fortnight and in the other week from after school on Wednesday until the following Friday morning. School holidays were to be divided equally.
Ms Ackerman was represented by her barrister, Ms Ross on this occasion. In the period since, the arrangement has continued without amendment. The parties agreed that the children would spend week about, with their parents, during the end of year school holiday in 2011/2012. Accordingly, this arrangement now must be considered reasonably longstanding.
In addition, in the period pending trial, the parties have been offered mechanisms, other than a judicial determination, to assist them to resolve the various controversies between them. These have included financial conciliation and family dispute resolution conferences.
In terms of issues to do with the children, the vexed issue was equal time. The first family dispute resolution conference took place on 16 August 2011 with Ms T, an experienced family consultant. She reported as follows:
“Ms Ackerman believes that the current arrangement whereby the children spend two nights one week and four nights the next with the father is as much as the children are able to cope with. She does not believe increased time with the father would be in their best interests.
If Ms Ackerman is not prepared to increase the children’s time with Mr Ackerman, he has asked that instead of two nights one week and four nights the next, that he has the children for six consecutive nights. Ms Ackerman did not say no to this suggestion, but she did not say yes. She said she will think about it and let Mr Ackerman know her answer prior to the next court hearing date.
… Ms Ackerman said that, since separation Mr Ackerman “had stepped up to the plate” as a father and the children did enjoy the time they had with him, but she said the girls made it clear to her that they do not want equal time. They want the longer time with Ms Ackerman.”[3]
[3] See family consultant brief advice to court dated 16 August 2011
Regrettably, neither party was able to compromise on issues relating to [X] and [Y]’s care. The financial mediation conference, convened for September 2011, was also unsuccessful. Against this background, the matter was fixed for final hearing.
As is commonly the case in matters involving parenting arrangements for children, the parties agreed to commission an independent expert to prepare a report to examine the salient issues. The parties agreed that the report would be compiled by Ms N, social worker, who has extensive professional experience working with children, including in the area of child protection.
Ms N was asked to interview the parties and observe them each with [X] and [Y]. In addition, Ms N was asked to speak with the children to ascertain any views they might have about their living arrangements. She also consulted with other professional, who had been involved with the children in the aftermath of their parents’ separation.
Ms N reported in late February 2012. She recommended that the current arrangement continue. She was impressed by the parenting capacity of both parties. She described [X] and [Y] as “delightful, friendly and polite children who were affection and caring.” In her written report, Ms N said as follows:
“It was the view of the family consultant that the current parenting arrangements were ideal for the children at present in that it balanced their need to spend quality time in each parent’s care, but not too long a period out of their mother’s care.
Mr Ackerman’s request that his time increase one night per fortnight was not supported at present for concern of the impact on [X]’s emotional wellbeing. However it was hopeful that in the future years the parties would work towards a shared care parenting arrangement for the children.”[4]
[4] See family assessment report dated 29 February 2012 at paragraph 74
Regrettably, an earlier final hearing scheduled for April 2012 could not proceed. The case was refixed for final hearing in November. From both parties’ perspectives, the proceedings have consumed a significant proportion of their financial resources. In the husband’s case, he estimates his legal fees to be around $95,000.00 In the wife’s case, she estimates her legal costs as being somewhere around $57,000.00
In monetary terms, their most significant assets are the Property A and Property D properties. In addition, the husband has accumulated superannuation, worth approximately $100,000.00
In global terms, the net value of the property available to be divided between the parties is around $550,000.00. The parties’ joint superannuation is valued at just under $140,000.00. Accordingly, on any consideration, the end of the parties' marriage and the proceedings which have followed, constitute a financial misfortune for both of them.
It is agreed that Property D is worth $355,000.00 and is subject to a modest mortgage of around $10,000.00. Both parties have a significant emotional attachment to the property, which was their joint home for many years.
When the final hearing began recently, it was the husband’s position that he wished to acquire the wife’s interest in the property, so that he could move back into it. On the other hand, the wife wishes to remain in occupation of the property. She was apprehensive at the prospect of having to find new accommodation for herself and the children.
As previously indicated, Mr Ackerman is a skilled [occupation omitted]. Currently, he earns a salary of just over $100,000.00 per annum. Ms Ackerman was out of the workforce, for many years, whilst she cared for [X] and [Y]. She has work experience in the [omitted] sector. More recently, she has gained employment as a [omitted] and has a part time job as a [omitted]. She earns a salary of around $43,000.00 per annum.
On any view, Ms Ackerman must be regarded as a modest income earner. As such, she has a limited capacity to borrow from a bank or other financial institution. She is significantly indebted to her parents, in respect of her legal fees. One of the issues arising in the case concerns the mechanisms available to the wife to purchase Property D and the overall justice and equity of this situation.
Both parties regard Property D as their and the children’s home. Obviously, they cannot both live in it. This difficult issue, suffused with emotion, has intensified the conflict between the parties. During the course of the hearing, Mr Ackerman indicated that he no longer wished to pursue his application to acquire the Property D property outright.
Accordingly, from his perspective, he is now content to allow
Ms Ackerman to purchase his interest in the property, if she has access to sufficient funds to do so. However how this outcome is to be achieved remains problematic.
Mr Ackerman presents as a frugal and financially prudent person. He was thirty years old, when he became involved with the wife. He had worked for [H] for his entire working life up to that time. When the parties commenced their relationship, he had acquired substantial assets in the form of real estate and [H] shares. He puts the value of these assets somewhere in the vicinity of $285,000.00
It is Mr Ackerman’s position that the entirety of this sum was utilised for joint matrimonial purposes, the chief of which was to acquire Property D and maintain it largely unencumbered by mortgage during the parties’ marriage. The aim being to ensure that the parties and their family had the security of a home, which was not subject to debt.
This remains the position up to the present time. Property D was purchased for just under $140,000.00 in November of 2000. The mortgage on the property is currently $10,098.00, leaving an equity of around $345,000.00. The mortgage on Property A is more significant and the property itself is worth less.
Ms Ackerman acknowledges that she was not in a strong financial position, when the parties commenced their relationship. She owned a property in [W], which was heavily mortgaged. She also had a motor vehicle of modest value and limited superannuation.
In all these circumstances, it is the husband’s position that any consideration of the parties’ respective contributions, at the outset of their relationship, must greatly favour him because his pre-marital injection of capital was the base from which the parties’ subsequent wealth has been grown. He concedes however, that during the parties' marriage, their contributions, although different in nature, should be considered as equal.
It is Mr Ackerman’s position that the court should allow him a weighting somewhere in the vicinity of twenty percent of the net pool of assets to accord “special recognition” to his initial contribution of capital. Ms Ackerman, whilst accepting the husband did bring significant assets into the marriage, asserts that such a weighting would be inequitable to her.
It is also her position that her future financial security is far less assured than is the husband’s and this factor calls for a significant percentage division of assets in her favour. The chief consideration in this regard being her lesser income earning capacity.
At present, Ms Ackerman believes that she will be able to borrow, at best, a sum in the vicinity of $190,000.00, with her mother acting as her guarantor.[5] Mr Ackerman is concerned at the possibility of his entitlements being discounted in order to achieve an outcome in which the wife is able to retain the Property D property.
[5] See wife’s affidavit filed 27 November 2012 at paragraph 12
He also wishes to have sufficient capital to purchase a suitable home for himself and the children, given that whatever is the outcome of the case, [X] and [Y] will be living for significant periods of time with him.
The husband is currently living in the Property A property. This arose as a matter of expediency following the parties’ separation. The wife proposes that the husband retain the property as part of his property settlement entitlements. The husband wishes it to be sold. As the property was purchased as an investment, its sale will attract capital gains tax.
Mr Ackerman accepts that his future financial position is more secure than the wife’s because of his significantly larger wage. However, he does not concede that the wife’s circumstances warrant a large allowance being made in her favour.
As a result of these controversies, the parties have very different views as to how the pool of property, currently available, is to be divided between them. The husband’s view is that a division of 62/38 percent (or thereabouts), in his favour, is warranted, particularly given the value of the property he contributed at the start of the parties’ relationship.
On the other hand, the wife’s position is that the property pool should be divided 45/55 percent in her favour. The rationale for this division being that, in her view, the husband has given too much weight to his contributions and accorded insufficient consideration to her somewhat precarious financial future.
These reasons for judgment are directed to resolving the various disputes between the parties and to finalise the financial relationship between them. In determining where [X] and [Y] should live in future, the children’s best interests are the paramount or most important consideration in the case.
The application legal principles and evidentiary issues
a) Children’s issues
Part VII of the Family Law Act deals with orders relating to children. Before making any particular parenting order, the court must regard the best interests of any child concerned as the paramount consideration [Family Law Act section 60CA].
The matters which the court must take into account, in deciding how a child’s best interests are to be served, are set out specifically in the Act in section 60CC.
Section 60CC creates two classes of considerations which apply to the court’s determination of how a child’s best interests will be determined in proceedings before it – primary considerations and additional considerations. There are two primary considerations, which are set out in section 60CC(2)(a)(b) namely:
(a) the benefit to the child of having a meaningful relationship with both of the child's parents; and
(b) the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence.
Prior to recent legislative amendments, these considerations were not formally ranked in regards to one another. They have been referred to, in a number of decisions of the Family Court, as “twin pillars”, the importance of which depends on the circumstance of the case concerned.
However, as a result of the insertion of section 60CC(2A) into the Act, the court is now directed, in applying the primary considerations “to give greater weight” to the primary consideration relating to the need to protect children from physical or psychological harm from being subjected to, or exposed to, family violence.”
These primary considerations are stressed through the provisions of section 60B(1) & (2) of the Act, which contain a list of aims and principles, which the court is directed to apply to ensure that a child’s best interests are met through any orders it makes.
The list of objects or aims of the legislation is set out in s.60B(1). They are as follows:
“(a)ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child; and
(b)protecting children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence; and
(c)ensuring that children receive adequate and proper parenting to help them achieve their full potential; and
(d)ensuring that parents fulfil their duties, and meet their responsibilities, concerning the care, welfare and development of their children.”
The principles, which underpin these objects, are set out in s.60B(2) and are as follows:
“(a)children have the right to know and be cared for by both their parents, regardless of whether their parents are married, separated, have never married or have never lived together; and
(b)children have a right to spend time on a regular basis with, and communicate on a regular basis with, both their parents and other people significant to their care, welfare and development (such as grandparents and other relatives); and
(c)parents jointly share duties and responsibilities concerning the care, welfare and development of their children; and
(d)parents should agree about the future parenting of their children; and
(e)children have a right to enjoy their culture (including the right to enjoy that culture with other people who share that culture).”
Other specific criteria, relating to how the court is directed to consider how the best interests of any children concerned may be served, by any order which is made, are set out in section 60CC(3). There are fourteen such criteria, which are categorised as being additional considerations.
Pursuant to section 60CC(3)(m) the court is empowered to have regard to any other fact or circumstance, which it considers relevant. This ensures that the infinite variety of individual children’s circumstances may be addressed in any order which the court makes.
Although the court is directed to consider many factors, in discharging its duties under Part VII of the Act, the best interests of the children concerned remain paramount. The court’s duty is to deliver individual justice, for the child affected, in every case.[6] In this sense, the court’s inquiry is a “positive one tailored to the best interests of the particular children and not children in general …”[7] As such the various factors, in section 60CC, are inclusive but not exclusive of one another.[8]
[6] See B v B: Family Law Reform Act 1995 (1997) FLC 92-755
[7] See B v B: Family Law Reform Act 1995 (ibid) at 84,220
[8] See Russell & Russell & Anor [2009] FamCA 28 at [141] per Ryan J
The fundamental task for the court is to determine, bearing in mind all the considerations contained in section 60CC and bearing in mind the goals and principles contained in section 60B, what is the best outcome for any child concerned, both now and in the future.
As I have already indicated, pursuant to the provisions of section 60CC(2)(a), the court is required to give greater weight, in its determination of a child’s best interests, to issues arising under the primary consideration relating to the protection of children from abuse, neglect or family violence. The recent changes to the Family Law Act, regarding family violence, are significant ones. The key amendments are designed to “prioritise the safety of children in parenting matters”.[9]
[9] See Supplementary Explanatory Memorandum (Senate) Family Law Legislation Amendment (Family Violence and Other Measures) Bill 2011
This does not mean that allegations of family violence are to be uncritically accepted or anything other than closely scrutinised by the court or. Nor does it mean that the court must disregard the benefit of a child having a meaningful level of relationship with both parents, even in cases where there are concerns pertaining to family violence.
The rational for the amendments is to safeguard children from coming to harm as a result of exposure to family violence. Section 60CC(2)(A) makes this the court’s priority, in cases where the protection of children from harm, as a result of exposure to family violence, abuse or neglect is germane.
In the words of the relevant explanatory memorandum “where child safety is a concern, this new provision will provide the court with clear legislative guidance that protecting the child from harm is the priority consideration.” Future protective issues for a child are the court’s priority.
In this case, the husband and wife, as is the case in many matters which come before the court, each approach the case giving more emphasis to one of the primary consideration than the other. In his case,
Mr Ackerman stresses the benefits [X] and [Y] are likely to derive from having a meaningful level of relationship with him. On the other hand, Ms Ackerman emphasises issues associated with child safety, particularly the protection of the children from being exposed to family violence.
Both of these considerations remain important, but neither is pre‑eminent over the paramountcy principle contained in section 60CA. Although in appropriate cases, child safety is to be given pre‑eminence over parental relationship, the best interests of the child concerned remain the most important consideration arising from the statutory framework. In my view, what was said by the Full Court in B v B remains apposite:
“Ultimately it is a question of applying in a common sense way the individual section so as to achieve the best interest of the children in a particular case.”[10]
[10] Ibid at 84,220
Family violence is defined by section 4AB(1) of the Family Law Act. It means:
“violent, threatening or other behaviour by a person that coerces or controls a member of the persons family, or causes the family member to be fearful.”
Interestingly, the legislature has provided a list of examples of behaviour which may constitute family violence in section 4AB(2) of the Act. Some of these examples are:
·An assault;
·Stalking;
·Repeated derogatory taunts;
·Preventing a family member from making or keeping connections with his or her family, friends or culture.
Accordingly, family violence means not only violence, which causes a family member to be fearful, such as a direct assault to the person, but also encompasses behaviour that coerces or controls that person.
Pursuant to section 4AB(3) of the Act, a child is exposed to family violence if he or she “sees or hears family violence or otherwise experiences the effects of family violence”. Again, the legislation provides a list of non-exhaustive examples of situations in which a child may have been exposed to family violence.
These examples include the overhearing, by the child, of threats or personal injury made against a member of the child’s family by another family member; seeing or hearing an assault of a family member by another member of the child’s family; the child comforting or providing assistance to a family member who has been assaulted; and observing the physical sequellae of assault or damage to property, such as clearing up after such incidents or being present when police or ambulance officers attend an incident involving family violence.
In this particular case, Ms Ackerman alleges Mr Ackerman has behaved towards her in a manner which constitutes family violence as follows:
·Isolated her from friends and determined which social engagements she could have;
·Criticised the standard of her housework;
·Compelled her to read an entry from his diary written on 2 October 2010, around the time the parties separated, detailing observations of her movements and behaviour. This is alleged to constitute stalking;
·Gritted his teeth, strained his jaw, and put his hands into a fist, when he has lost his temper;
·In the period following the parties’ separation, photographed her car and drove past her place of residence, in the presence of the children;
·Assaulted his youngest brother, in 2006;
·Been impatient with the children, particularly if they were playing loudly, or carelessly;
·Referred to her as “fucking stupid” when she accidentally damaged a television cabinet;
·Referred to [X] as a “fucking cow”.
For his part, Mr Ackerman either specifically refutes these allegations or asserts that they do not meet the definition of violent or threatening behaviour, which coerces or controls a family member.
He accepts that, on occasions, his behaviour towards both the wife and [X] is open to criticism, on the grounds of intemperance or incivility but that such behaviour does not, of itself, satisfy the definition contained in section 4AB, when all the circumstances of the incidents in question are considered.
There is a presumption that it is in a child’s best interests for his or her parents to have equal shared parental responsibility for him or her [Family Law Act 1975 section 61DA]. The presumption relates to the allocation of parental responsibility, not the allocation of time which a child spends with each of his or her parents.
The presumption of equal shared parental responsibility is rebutted if it is found, on reasonable grounds, that one of the child’s parents has abused the child concerned or exposed him or her to family violence [section 61DA(2)].
The presumption is also rebutted if evidence is provided which satisfies the court that it would not be in the child’s interests for his or her parents to have such equal shared parental responsibility for the child concerned [section 61DA(4)].
As previously indicated, notwithstanding the fact that much of
Ms Ackerman’s case centres on issues to do with family violence, she does not argue that the presumption arising from section 61DA is rebutted in this case, either on the basis of family violence or any other ground. It is also Mr Ackerman’s position that the presumption should be applied in respect of future parenting arrangements for [X] and [Y].
An order which provides for equal shared parental responsibility requires that the parties to it to consult with one another and make a genuine effort to come to a joint decision about major long-term issues to do with the child or children concerned [section 65DAC].
Major long-term issues is defined in section 4 of the Act and includes issues to do with a child’s education; religious and cultural upbringing; the child’s health; the child’s name; and changes to the child’s living arrangements that would make it significantly more difficult for the child concerned to spend time with a parent.
Pursuant to section 65DAE, parents do not have to consult on matters, which are not concerned with long term issues, when the child is spending time with one or other of them.
This is to ensure that the myriad decisions, which have no long term significance concerning a child and which need to be made on a day to day basis, by both of the child’s parents, can be made when they need to be made without consultation.
The Family Law legislation emphasises the importance of parents being actively involved in their children’s lives – in their schooling; sporting activities and recreation; and their daily routine; as well as special occasions; – so long as this involvement is commensurate with protecting the children concerned from harm.
Section 61DA deals with the allocation of parental responsibility in respect of a child. It does not deal directly with more practical aspects of a child’s life, particularly the amount and type of time a child spends with his or her parents or where a child is to live. Such matters are dealt with by section 65DAA.
By application of section 65DAA, if the presumption of equal shared parental responsibility applies in respect of a child, the court is required to consider firstly whether the child concerned should spend equal periods of time with both his or her parents, provided such an outcome is both likely to be in the child’s best interests and reasonably practicable.
If the court rejects equal time, it is then required to consider the child spending “substantial and significant” periods of time with each of his or her parents. Again, this outcome is subject to consideration of the child’s best interests and reasonable practicality.
In this case, as a result of evidence provided by Ms N, Mr Ackerman is no longer pursuing an order for equal time. As previously indicated, although there are differences in the exact configuration of the parenting orders sought by the husband and wife respectively, it would seem to me that each set of proposals envisages [X] and [Y] spending substantial and significant periods of time with each parent.
The expression “substantial and significant time” is defined in the Family Law Act 1975 [section 65DAA(3)]. It means time that allows a child to spend time with a parent on both weekends and holidays; and days during the working or school week.
More significantly, it is time which enables a parent to be involved in a child’s daily routine and in occasions and events, which are of particular significance to the child concerned.
Again, the aim of the legislation is to enhance the parent/child relationship concerned, through mechanisms which enable the child to spend time with a parent in a variety of settings.
Issues of practicality are dealt with by section 65DAA(5). The court is required to consider how far apart are the parties’ homes; the parties’ current and future capacity to implement shared care type arrangements; the parties’ ability to communicate with one another and solve parenting problems consensually; and most importantly, the likely impact of such an arrangement on the child concerned.
The High Court has recently considered the interplay between the question of whether it is in a child’s best interests to spend equal time with each parent (and substantial and significant time) and the question of whether such outcomes are reasonably practicable, which arises from s.65DAA(1) & (2) of the Act. It has determined that both questions must be answered in the affirmative before an equal time order may be made.
The High Court has held that it is a statutory pre-condition of the making of an equal time order that it is reasonably practicable for such an order to be made. Accordingly courts such as this are directed to consider the reality of the situation which confronts parents and child not merely whether it is desirable that there be equal time spent by the child with each parent. Essentially, a consideration of what is feasible for a child is of equal importance to what is desirable for that child.[11]
[11] See MRR v GR [2010] HCA4 at paragraphs 13 and 15
b) Property
The process to be followed, for the division of the parties’ property, is well established by law.[12] The relevant legal principles are primarily contained in Section 79 and 75(2) of the Family Law Act 1975. I am required to follow a number of steps.
[12] See Lee Steere v Lee Steere (1998) FLC 91-626; Ferraro v Ferraro (1993) FLC 92-355; Clauson v Clauson (1995) FLC 92-595; Hickey v Hickey &Attorney-General of the Commonwealth of Australia (Intervenor) (2003) FLC 93-143
Firstly, I must ascertain what are the parties’ assets and liabilities as at the date of trial.[13] This first step is largely uncontentious between the parties, as they agree on the value of both the Property D and Property A property and the amounts owed on each mortgage pertaining to those properties. There is also no dispute about the level of their respective superannuation entitlements or the value of other items of personal property.
[13] See Biltoft & Biltoft (1995) FLC 92-614
The second step involves the court ascertaining the contributions which each party has made towards those assets. Contributions fall into two broad categories. The first kind is contributions to the property: financial contributions and non-financial contributions, made directly or indirectly, by or on behalf of a party to the marriage to the acquisition, conservation or improvement of any of the property.
The second kind is contributions to the welfare of the family: in the words of the section, “the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage, including any contribution made in the capacity of home maker or parent.”[14]
[14] See Family Law Act s79(4)(c)
It is clear from the authorities that this second kind of contribution must be given appropriate weight and is not to be treated as a token matter or as a contribution which is inherently less valuable or important than a financial contribution to property.
The second step occasions controversy between the parties in the following areas:
·The husband asserts that between July 1999 and February of 2001 he sold property to the value of approximately $286,289.00;
·This sum was utilised as follows:
Ø To finance a pre-marriage holiday;
Ø Fund the parties wedding;
ØSignificantly reduce the mortgage on the Property D property;
Ø Renovate the Property D property;
Ø Pay off a pre-relationship loan of the wife.
·It is the husband’s position that these are contributions which merit being given “special recognition”, in his favour, at this stage of the court’s deliberations;[15]
·The husband contends that the wife’s pre-marital financial contributions were modest, when compared to his own;
·The wife concedes that the husband did make significant pre‑marital financial contributions, but disputes their quantum and more importantly, the weight the court should attribute to them;
·It is common ground between the parties that the husband was the families main financial provider and the wife was the main homemaker and parent during the parties’ relationship;
·In these circumstances, the parties agree that their various contributions, although different in nature and quality during the period of their marriage, should be assessed as being essentially equal;
[15] See Pierce & Pierce (1999) FLC92-844 at 85,811
At the end of the second stage, the husband asserts that the husband’s various contributions, during the duration of their marriage, should be assessed as being fifteen to twenty percent in his favour. Accordingly, he would propose that the parties contributions be assessed 70/30 percent, in his favour, at the end of this stage.
On the other hand, the wife whilst accepting that there should be some weighting in the husband’s favour, because of his significant pre-marriage contributions, submits that a weighting of twenty percent would be inequitable. At the end of the second stage, it is her position that the parties’ marital assets should be divided 60/40 percent in the husband’s favour.
The third step involves the assessment of the parties’ prospective needs, by reference to the factors set out in section 75(2) of the Family Law Act 1975. The court must also have regard to the factors set out in section 79(4)(d) to (g).
Pursuant to section 75(2)(o), the Court is entitled to take into account “any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account”.
In the main, section 75(2) deals with the prospective needs of the parties. This area creates some controversy between the parties, although the husband concedes that overall the matters arising under section 75(2) favour the wife.
The following considerations arise at the third step:
·The wife asserts that there is likely to be a significant discrepancy in the parties’ respective incomes for the indefinite future;
·In this regard, the wife points to the fact that the husband has qualifications and experience as an [omitted], where she has only comparatively recently returned to the workforce and has no formal qualifications and limited experience.
At the end of the third stage, the wife asserts that a proper consideration of the applicable section 75(2) factors, particularly the income of each of the parties and their respective physical and mental capacity to obtain appropriate employment, greatly favours her. In these circumstances, she asserts that she is entitled to a fifteen percent distribution of the parties’ pool of marital assets.
On the other hand, the husband’s position is that the wife has over emphasised these factors. He concedes Ms Ackerman is entitled to some weighting, in her favour, due to section 75(2) factors, but would argue that the appropriate allowance is somewhere between three percent and five percent.
In determining what order the court should make, under section 79, the court must be satisfied, that in all the circumstances, it is just and equitable to make the relevant orders. Overall, it is the justice and equity of the actual orders that the court must consider.[16]
[16] See Russell v Russell (1999) FamCA 187
The “overriding requirement” of section 79 is that considerations of justice and equity should inform each step of the process. The exercise I must undertake is not a “process of social engineering”[17] or of equalisation of assets or financial resources.
[17] See Waters & Jurek (1995) FLC 92-635
In this case, the parties have ended their marital relationship. As such, it is necessary that the court makes orders which will end their financial relationship, particularly in terms of their mutual ownership of property acquired during their marriage. Indeed both parties seek orders to this effect.
In this context, it is clearly fair, from both Mr Ackerman and
Ms Ackerman’s perspective, that the court makes necessary orders for the division of property according to the principles delineated in section 79(4) of the Act.[18]
[18] See Stanford & Stanford (2012) HCA 52 at [42]
The evidence
In these reasons for judgment, findings of fact are made on the balance of probability. In what follows, statements of fact constitute findings of fact.
The parties and Ms N were the only witnesses, who gave oral evidence in these proceedings and so were subject to testing through the process of cross-examination. In addition, the wife relied on an affidavit of
Ms W, who was a neighbour of the parties in Property D for most of their marriage.
Ms W’s affidavit dealt with her observations of the parties' relationship, particularly her impression that Mr Ackerman was emotionally insensitive to both the wife and the children. Mr Ackerman chose not to require Ms W to attend for cross-examination. Accordingly, her evidence is not subject to challenge.
Both parties were represented throughout the proceedings. Each has prepared a number of lengthy affidavits. The case itself occupied three sitting days, during which both parties were subject to extensive cross-examination. As such, I had ample opportunity to observe both parties and form a view as to their respective credibility and personality.
At the end of the day, there were few real issues of factual dispute between the parties. The differences arising were, in my view, a reflection of the differences in the parties’ temperaments and personality rather than any flaws in memory or attempts to dissimulate or exaggerate.
Both parties seemed to me to be pleasant and honest witnesses, who each attempted to reconstruct their financial and personal history together, as best they could. However, due to the emotional trauma arising in the latter portion of their marriage, necessarily each has a different perspective on how the other behaved and the ramifications of this behaviour, in the period prior to their separation.
Mr Ackerman is an unabashed traditionalist where marriage is concerned. He acknowledges that, when the parties married, he saw himself as the family’s main breadwinner. In those circumstances, he was not supportive of the wife being part of the formal workforce. He saw her role as a homemaker and parent. He was anxious to have children. I have no difficulty reaching the conclusion that the wife shared these aspirations and went along with them, at least in the early years of the parties’ marriage.
The husband is a punctilious person. He acknowledged that he has a need for order, tidiness and regularity in his life, both at home and outside it. At this stage, a small example will suffice. He found it annoying when the wife left her shoes in a place where he might trip over them, particularly as there was a special cupboard, in the parties’ home, where footwear was ordinarily stored.
From the wife’s perspective, his annoyance and frustration at finding footwear, where he did not think it should be, was verging on the obsessional. Certainly, Ms Ackerman seems to have had a less formal and more laissez faire attitude to matters of household tidiness. She is also likely to be a more informal and less disciplinary in her approach to her parenting than the husband.
Mr Ackerman’s personality traits also inform his approach to financial matters. He is a stickler for the keeping of financial records. He has a good memory for figures. As such, of the two parties, I accept that he is likely to be the better financial historian.
In his evidence, Mr Ackerman indicated that the end of the parties' marriage was a shock to him. He also acknowledged that he did not react well to this shock. Since the parties separated, it is his perspective that he has worked through his emotional distress and attempted to re-evaluate and adapt his parental role with [X] and [Y].
In this regard, Mr Ackerman accepted that he had made past mistakes in his parenting of the children. In particular, he agreed that he had left much of the parenting of [X] and [Y] to Ms Ackerman, during the course of the parties' marriage. With the separation, he accepted that he would have to change his role, with the children, if he was to be meaningfully involved in their future parenting.
In this context, I found Mr Ackerman to be a painfully honest witness. He acknowledged his past failings. In my view, he has demonstrated a willingness to seek professional help to redress some of these failings, which he did not seek to trivialise. I found him to be insightful, in this regard and not the petty martinet portrayed by the wife. To the contrary, I found him to be an emotionally sensitive person.
That is not to say Mr Ackerman is perfect. He most certainly does not have extraordinary reserves of equanimity and self-control. He has a temper and when stressed or annoyed will lash out verbally. In short, Mr Ackerman is prone to display the full range of human frailties.
Ms Ackerman describes herself as an unassertive person. I agree with this description. She is also a tender and loving person. Without doubt, her life is defined by her role as [X] and [Y]’s mother. I agree with
Mr Ackerman’s assessment that she is an excellent and caring parent.
Inevitably, proceedings between former marital partners evoke strong emotional responses. These emotions are likely to inform how parties recollect past events and, when those events need to be reconstructed, for the sake of adversarial proceedings such as these, it is only to be expected that such a subsequent reconstruction should favour the party making it.
As such, this is not a case which turns specifically on findings regarding credit. Both parties have exhibited natural biases, in their respective favours, in how each has constructed their case. In these circumstances, I must analyse the evidence in respect of a range of issues and determine, on balance, whose evidence is likely to be more reliable in respect of the particular issue concerned.
From both parties’ perspectives, the end of the marriage between them has necessitated a need to re-evaluate and change their former patterns of life. The wife has had to return to the paid workforce, on a full-time basis. More importantly, she has had to adapt to Mr Ackerman wanting to occupy what was previously her largely exclusive domain as [X] and [Y]’s principle carer. This is likely to be difficult for her and to precipitate strong feelings.
In addition, these changes are likely to challenge both parties previously held views regarding the roles of men and women in caring for children. Some in society may regard Mr Ackerman, at worst, as being something of a male chauvinist, so far as his past views are concerned in respect of male and female roles in a relationship or at best somewhat out of step with contemporary mores.
However, regardless of past attitudes, both parties have had to adapt their views and change their parenting practices and roles in the light of their now dramatically changed circumstances. Given the emotional trauma surrounding their separation, it is unreasonable to expect them to make these changes in a collaborative or empathetic manner. The process is necessarily difficult and challenging for them each.
It is in this context that the court must examine the wife’s significant allegations that both she and the children were the victims of family violence instigated by the husband. Given the structure of the applicable legislation, these allegations must be critically examined.
However, I must also bear in mind that the parties’ current circumstances, locked as they have been in an intensely adversarial struggle with one another, centred on issues likely to be perceived as pertaining to the control of the children, is likely to act as a prism distorting their perceptions as of what has occurred in the past. In my assessment, this distorting effect is markedly more pronounced so far as the wife’s evidence is concerned.
In my assessment, Ms Ackerman is likely to be a less objectively reliable witness than is Mr Ackerman. That is not to say that I consider her to be a dishonest person in any way. She is not. Rather, she is likely to be more influenced by her feelings in the case. Ms Ackerman’s feelings, in turn, are likely to have an influence on the children concerned in the case and how they have expressed their feelings.
a) Background
The husband was born [in] 1969. The wife was born [in] 1972. Both parties are in good health. The parties met in early 1998. They began to live together in early 1999. The husband proposed marriage to the wife [in] 1999 and she accepted. They married [in] 2000.
At the time the parties met, the wife was working as a [omitted] and the husband was employed by [H] as an [omitted]. The wife stopped working in January 2001, when she was pregnant with [X].
Mr Ackerman had worked for [H] for a considerable period of time. He ceased employment with the company on 19 April 2000 and commenced working for his parents’ business [C] Pty Ltd.
The parties had a pre-wedding overseas honeymoon between [dates omitted] 2000. They purchased the Property D property, on [date omitted] 2000, for the sum of $139,692.85. Prior to that time, the parties lived in a property owned by the wife located at Property W, [W]. This property was sold in September 2001, netting an amount of $15,138.35.
The parties purchased Property A, as an investment, on 31 March 2005. The purchase price was $109,077.45. It was subject to a mortgage in excess of the purchase price.
As previously indicated, the parties separated, initially under the one roof, on 20 September 2010. The husband left the Property D property on 22 October 2010, once the Property A property became vacant.
b) The nature of the parties relationship
To his credit, Mr Ackerman describes Ms Ackerman as “a very good mother and a very good home provider”. This description accords with my own impression of Ms Ackerman, whom I accept was and is devoted to the wellbeing of [X] and [Y]. Accordingly, in the formal setting of these proceedings, the husband has no criticisms of the wife’s parenting and homemaking abilities.
He does however concede that, in the past, he made what he regards as trivial complaints about the wife’s homemaking, for example when she did not keep up with the ironing. He refutes the suggestion that he cast himself in the role of overseer in respect of the wife’s domestic responsibilities or unreasonably quizzed her about what she had done during the day, whilst he had been at work.
Mr Ackerman would describe himself as “a very tidy person” who liked to put things “in the right place”. He acknowledged that
Ms Ackerman regarded him as “too fussy” in this regard. However, he thought, when the parties began to live together, “their standards were the same”. In short, Mr Ackerman denies that his domestic persona was one of control, manifested by a constant putting down of the wife or a ceaseless criticism of her.
The flavour of much of the wife’s case is that she felt forever beholden to Mr Ackerman, who made her feel devalued and inadequate in the discharge of her domestic duties, which she performed to the best of her abilities. Her case being that the consistent theme of how the husband interacted with her was that he was at pains to point out how hard he had worked to put bread on the table, whilst she, on the other hand, had achieved little at home.
I accept that the parties' marriage was, from time to time, riven by tensions and petty irritations. After all, as is self apparent, the marriage between the parties has now come to an end as a result of their personal differences. Whatever was the commonality in values, at the start of their marriage, it was far less at its end.
However, in my view, these types of marital tensions fall well short of violent or threatening behaviour. They may be criticised as sexist or insensitive, but, in my view, for the reasons which follow, they are not family violence within the meaning provided by the Act.
Mr Ackerman denied he could be described as excessively strict with either the wife or the children. Rather, he said that he had “high standards”, which he had inherited from his parents, who had instilled in him “traditional family values”. It is the husband’s position that the wife left issues pertaining to the discipline of the children to him.
Mr Ackerman’s view is that the marriage between the parties was “a very strong and happy [one] in the beginning” but as time went on, the parties began to “differ”. Areas of contention arising between the parties being the husband’s long working hours and his interest in pursuing sports activities outside the home. The implication being that the wife felt that the husband was selfish and self-absorbed and did not pull his weight so far as parenting the children was concerned.
From the wife’s perspective, she felt increasingly isolated as the marriage went on. Her perception was that the husband had few, if any, friends and did not relish socialising, in contrast to her. The wife asserts that the husband made it difficult for her to see her friends. She deposes as follows:
“The husband will tell me that I was married with children and that he didn’t understand why I should want to go out. I felt as though I had to justify wanting to see my friends to the husband such as saying that I was seeing someone for their birthday.”[19]
[19] See wife’s affidavit filed 12 April 2012 at paragraph 45
I accept that the parties had differing needs for social interaction. In general terms, it is likely to have been the husband’s preference for the parties to stay home. In addition, he seems to have had personal objections to some of the wife’s choices of friends, particularly Ms W, whom he regarded as being undesirable, for reasons which he explained in court but which I will not recount now.
However, regardless of the husband’s disapprobation for Ms W, the evidence indicates that the wife continued to see Ms W and did go out to socialise from time to time with other people. Perhaps it was not as much as she would have liked but I do not accept that she was either forcefully socially isolated or intimidated by the husband into withdrawing herself from contacts outside the home. In addition, the evidence indicates that the wife joined the workforce, in 2006, when she began as a [occupation omitted].
The husband’s preference was that the wife remain exclusively engaged in home duties. Ms Ackerman wanted to work. The evidence indicates that the parties discussed the issue and a compromise was reached, with Ms Ackerman embarking on part-time employment.
Again perhaps it may have been Ms Ackerman’s preference to have worked longer hours. In addition, Mr Ackerman may be criticised for being old fashioned or even sexist in his attitudes. However, in my view, this falls far short of coercive or controlling behaviour.
The evidence does not indicate that Ms Ackerman was prevented from maintaining connection with her friends and family. Rather, to my mind, the issues in contention between the parties, in this context, reflect differing emphasis in their respective personalities and world views. It is not a case of one spouse controlling the other.
Ms Ackerman describes the husband as being “very peculiar about where things were placed in the home.”[20] Her criticisms include the husband’s requirement to put away shoes, coats and her handbag in specific areas of the home and that the children put away their toys. From Mr Ackerman’s perspective, he agrees that he is tidy and considers it a good thing that the children put away their toys, when they have finished with them.
[20] See wife’s affidavit filed 12 April 2012 at paragraph 73
Again, in my view, issues of this type reflect the different personalities of the parties concerned. From both parties’ perspective, no doubt, the attitude of the other in respect of these issues of domestic management was perceived as being highly irritating or even provocative, but again I do not regard it as conduct which satisfies the definition of family violence. In my view, in this case, the disputes between the parties, regarding domestic standards, are not evidence of a coercive power imbalance between them. Rather they reflect their different attitudes to order and tidiness.
Ms Ackerman asserts that Mr Ackerman has “the capacity to become violent when he is angry”.[21] However she concedes that he never raised a hand to her. The violent behaviour being “straining his jaw, gritting his teeth and his hand would go into a fist”. Although Ms Ackerman does not specifically say so, the implication of her evidence is that Mr Ackerman’s conduct caused her to be fearful and, as such, can be said to constitute an assault.
[21] Ibid at paragraph 86
Mr Ackerman acknowledges that at times he has a forceful personality and has a habit of gritting his teeth, when frustrated. He refutes any suggestion that he is an innately violent person, who has particular difficulties with controlling his temper. He denies that he intended to frighten the wife with this behaviour or that she indeed was frightened of it.
During the course of the evidence, Mr Ackerman demonstrated what he said he did with his fist, when frustrated or annoyed. It was in the manner of clenching with his arm remaining by his side. He did not raise his arm or fist. In terms of gritting his teeth, he acknowledged that he has this habit but was at time unaware of it. In my assessment the manner of behaviour is more consistent with a reaction to emotional tension than an overt expression of intimidation.
I acknowledge that there may be cases where one party to a marriage can cower or intimidate the other with a look or a gesture. However, on my assessment of the parties in this particular case, I do not think that Mr Ackerman’s conduct towards Ms Ackerman meets this scenario.
Rather, it seems to me that the parties each became increasingly unhappy in their marriage, as they drifted further apart. In such a situation, more and more areas of friction arose between them. The husband became frustrated at times and angry. So too did the wife. In my view, it is likely that the parties have different ways of exhibiting emotions such as these.
No doubt, these various flashpoints could have been more sensitively and tactfully dealt with by the parties. It is easy to be wise with hindsight. In this context, I believe that I must be careful not to unduly censure conduct that arose in response to the stressful emotional situation in which the parties found themselves from time to time.
The wife’s criticisms of the husband have been retrospectively compiled, in circumstances where she wishes to cast him in as unflattering a light as possible. In this context, I believe that I must approach her categorisation of Mr Ackerman with some caution.
This is particularly so in respect of her allegations regarding
Mr Ackerman’s assault on his brother, which led to Mr Ackerman being charged with assault by police. The incident itself occurred in February 2006, a significant period prior to the parties’ final separation.
Mr Ackerman was extensively cross-examined about the incident. He was visibly upset about the incident concerned and acknowledged that he had been charged by the police. However, his evidence was that he was not convicted of assault by the presiding magistrate because of the extenuating circumstances surrounding the matter.
Essentially, it is Mr Ackerman’s position that his younger brother, at the time in question, was using drugs and behaving in an irresponsible manner, which caused great distress to his parents. His case is that his brother, whilst under the influence of drugs, behaved in a provocative manner to him, to which he responded physically. As I have said,
Mr Ackerman greatly respects his parents and the values they represent for him.
Ms Ackerman does not appear to have been present during the incident. Rather, she has heard about it second hand. In these circumstances, I am concerned that she has chosen to reactive the issue opportunistically. In my view, the matter is not greatly relevant to these proceedings.
The wife characterises the husband as being easily frustrated and impatient. She gives two major examples of his conduct, which she asserts are demonstrative of his excessive irascibility. Firstly, she is critical of Mr Ackerman for excessively disciplining the children, when they were throwing a wheat bag in the living room. Secondly she is critical of him for abusing her when she dropped a television set, which caused a scratch in a television cabinet.
In regards to the wheat bag incident, Mr Ackerman agrees that he over-reacted when [X] threw the bag at [Y] who failed to catch it, allowing it to hit a wall. He told [X] to “stop being stupid”. He did not think it was appropriate that the children were playing with something not specifically designed to be a toy in an area of the house which was not the children’s play area.
In my view, I must be careful not to adopt an unduly utopian standard for the parties’ communication skills or expect them to adhere to a standard, which is clearly unattainable given that they separated in difficult and acrimonious circumstances, as many couples do. Particularly those that seek the court’s assistance to resolve their parenting disputes.
In this case, it is my assessment that both parties are well advanced in the process of adjusting to their changed circumstances. Both have embarked upon new relationships. As such, it is my assessment that the parties’ communication skills are likely to improve in future.
The children have been living in the current regime for a period in excess of two years. Ms N’s assessment is that the children are coping with this regime. She recommended that the children engaged in no further therapeutic intervention.
In all these circumstances, it is my view that it would be reasonably practical for the court to continue the regime, which has been in place since the parties separated. As previously indicated, I also accept that this regime is the one most likely to serve the children’s best interests.
Property
Step One – the pool of assets
I find that the pool of assets available for division between the parties is as follows:
Property D, [W]
$355,000.00
Property A, [W]
$210,000.00
Wife’s motor vehicle payout
$13,700.00
Husband’s motor vehicle
$4,400.00
Family trust account
$48,791.00
Total Assets
$631,891.00
Liabilities
Mortgage on Property D
$10,098.00
Mortgage on Property A
$71,198.00
Total liabilities
$81,296.00
Total Assets
$550,595.00
Superannuation
Husband’s superannuation
$102,818.00
Wife’s superannuation
$32,974.00
Total Superannuation
$135,792.00
Step Two – assessment of contributions
I now turn to the second of the steps in the exercise under section 79, namely an assessment of the parties’ contributions within the context of section 79(4)(a) to (c). These provisions are as follows:
“Section 79(4) In considering what order (if any) should be made under this section in proceedings with respect to any property of the parties to a marriage or either of them, the court shall take into account –
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them;
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them;
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of home maker or parent.”
Section 79(4) requires that the court look at the entirety of the contributions, both financial and non-financial, to the welfare of the family, as well as to the acquisition, conservation and improvement of those assets. Contributions are not required to be tied to the acquisition, conservation and improvement of any particular asset and maybe taken into account generally as contributions in a total sense.
The task required of me pursuant to section 79(4) of the Family Law Act thus is to weigh and assess the disparate contributions of the parties to arrive at an outcome, which is both appropriate and just and equitable in all the circumstances. Contributions, which are different in quality and nature, must be compared. The exercise is not purely an arithmetical or accounting one.
In this case, the parties agree that, during the actual duration of their marriage, their various contributions, albeit in different areas of endeavour, are to be regarded as essentially equal. The wife was the family’s homemaker and parent, whilst the husband was its breadwinner.
These activities are obviously different in their essential nature, with it being easier to attribute worth to a role which has a clear economic output such as that of a wage earner. In this context, I must be careful not to undervalue the homemaker role.[32] Mr Ackerman would not have been able to go out to work and earn an income without the support of Ms Ackerman. In addition, it is clearly the case that the parties agreed that they would start a family as soon as possible and the means of supporting this family would be the wife remaining at home and the husband supplying the necessary financial resources required.
[32] See Ferraro & Ferraro (1992) 16 FamLR 1 at 38
Having considered the evidence in the case, in my view, the parties’ characterisation of their various contributions during their marriage is the correct one. The parties jointly agreed that they would divide their familial responsibilities along traditional lines. Certainly, this was
Mr Ackerman’s preference. He wanted Ms Ackerman to be available to parent [X] and [Y] during their infancy and Ms Ackerman was content to fulfil this role.
The evidence is that Mr Ackerman worked hard and was a reliable financial provider. In addition, it is clear to me that Ms Ackerman was a competent and devoted parent, who managed the parties’ home effectively and was an exemplary parent for [X] and [Y]. In these circumstances, I assess the parties’ contributions as being equal.
The more difficult aspect of the case is how the husband’s significant injection of capital, at the stage the parties began their relationship, should be treated, particularly that the marriage between the parties was a lengthy one, occupying a period of around ten years. Without doubt, Mr Ackerman unreservedly contributed all his financial assets to the marriage, once the parties had committed themselves to each other.
For obvious reasons, the longer a marriage is, the more financial implications it is likely to have for the parties concerned. This is particularly so if one party to the marriage has, in effect, surrendered financial independence, in the form of being able to participate in the paid workforce, by assuming the role of homemaker and parent in the family concerned.
In the past, it has been suggested that disparities in capital, at the outset of a marital relationship, become less significant as the duration of the marriage concerned increases. It was sometimes said that such contributions were liable to erode over time. The Full Court has not endorsed such a formulation.
In Pierce & Pierce,[33] Ellis, Baker & O’Ryan JJ made reference to several of the relevant authorities. In the case, their Honours said as follows:
“In our opinion it is not so much a matter of erosion of contribution but a question of what weight should be attached, in all the circumstances, to the initial contribution. It is necessary to weigh the initial contributions by a party with all other relevant contributions both of the husband and the wife. In considering the weight to be attached to the initial contribution, in this case the husband, regard must be had to the use made by the parties of that contribution.”
“…there is no principle that the length of the marriage leads to a likelihood that other contributions will outweigh or weigh equally with ‘a particular contribution’. It is a matter of assessing the contributions of all relevant kinds in each case to arrive at an outcome, which is both appropriate and just and equitable. In some cases particular contributions may be outweighed or equalled by other ones. In other cases particular contributions may be so disproportionate to other contributions as to merit special recognition.”
[33] Pierce & Pierce (1999) FLC 92-844 at page 85,811
In this case, it is clear that the husband provided funds to the value of at least $265,000.00 at the outset of the parties’ relationship, which was grossly disproportionate to the funds initially contributed by the wife. It is true that not all of these funds went to capital investment. However, the amounts which were diverted to finance areas of discretionary spending, such as the parties’ honeymoon and wedding were comparatively modest.
I accept that other monies, substantial in quantum, were also directed towards renovations on the Property D property. However, it is not possible in purely arithmetical terms, to ascertain what has been the effect of those contributions, if any, on the increase in value of the property. Nonetheless, in my view, this is also a significant direct financial contribution attributable solely to Mr Ackerman.
As I have observed earlier in these reasons for judgment, Mr Ackerman is a person characterised by caution and prudence in financial matters. It is also clearly the case that he was completely committed to the parties' marriage at its outset and wished to make all his financial resources available to benefit the wife and the family as it developed.
With this in mind, he liquidated his assets and translated them into the former family home, which was largely mortgage free during the marriage. In my view, this must be regarded as a significant contribution. The husband’s initial financial contributions were the rock on which the parties’ subsequent financial security was built.
The fact that the Property D property was mortgage free provided the parties with a high degree of financial security. It was also the basis from which the Property A property was purchased. Later, the parties were able to use their equity in the property to purchase motor vehicles, as required. It must be the case that moneys saved in mortgage payments were able to be diverted for family purposes.
This contribution is so significant that it would be neither just nor equitable if it were not given some special recognition at this stage of proceedings. It was the base on which the family’s financial security was built during the entirety of the marriage. In these circumstances, I propose to allow the husband a weighting of eighteen percent, in respect of this contribution. Accordingly, I assess the parties’ respective contributions towards the acquisition and preservation of their non-superannuation assets as being 68/32 percent in the husband’s favour.
The parties each agree that their respective contributions towards their superannuation assets should be assessed separately from their more conventional assets. By its nature, superannuation entitlements have a different quality to other types of property, the value of which can be readily ascertained by sale. One of their most significant attributes of superannuation entitlements is that they are not ordinarily accessible during the working lives of their beneficial holders and their realisation depends on factors such as age; retirement from the paid workforce; and health.
So it is in this case, the parties are both in their early to mid forties and have no plans to retire from the workforce. Accordingly, it will be many years until they will be able to access their superannuation resources.
In C & C[34] the majority of the Full Court said as follows:
“In summary, then, the trial Judge has a discretion as to how superannuation interests will be treated in a particular case. If superannuation is not included in the list of property but rather made the subject of a separate pool, it will be necessary where a splitting order is sought, or extremely prudent where no such splitting order is sought (in order to ensure that justice and equity is achieved) to:
a) value the superannuation interest (according to the Regulations if an order under Part VIIIB is sought or according to the Regulations or otherwise if no order is sought);
b) consider and make findings about the types of contributions referred to in s 79(4)(a), (b) and (c) which have been made by the parties to the superannuation interests on either a global approach or an asset by asset approach depending on the circumstances;
c) consider the other factors in s 79(4) being the matters in s 79(4)(d), (e), (f) and (g); and
d) ensure that pursuant to s 79(2) the orders in relation to the parties’ property, and any order under Part VIIIB in relation to superannuation interests are just and equitable.
In the context of a consideration of the matters referred to in sub-paragraphs (b) and (c) of the last paragraph, the following matters may well be relevant: the relationship between years of fund membership and cohabitation (if applicable), at separation and at the date of hearing; preserved and non-preserved resignation entitlements at those times; and any factors peculiar to the fund or to the spouse’s present and/or future entitlements under the fund.”
[34] See C & C (2005) FLC 93-222 at 79,646
In this case, the husband had approximately $36,000.00, in his [H] superannuation, at the time the parties married. Of this sum, he realised approximately $16,000.00, which was utilised for joint marital purposes, leaving a balance of around $20,000.00. This was rolled over into a privately managed fund and is the basis of the husband’s current entitlements.
The wife’s superannuation holdings, at the date of the parties' marriage, were about $10,700.00. Due to her absence from the paid workforce, these funds have not been augmented greatly during this time. In dollar terms, the value of the parties’ respective superannuation holdings were not significant at the outset of their marriage, albeit the amount rolled over by the husband was twice that retained by the wife.
As with their non-superannuation assets, it would seem uncontroversial that the parties’ contributions to superannuation acquired during their marriage should be regarded as equal. In these circumstances, I do not propose to make any formal percentage calculations, in respect of superannuation matters, at this stage.
Step Three – section 75(2) factors – the prospective needs of the parties
I am now required to consider the various matters set out in section 75(2) and in particular to consider whether any further adjustment should be made in favour of either party. The section 75(2) factors are as follows:
(a) the age and state of health of each of the parties;
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;
(c) whether either party has the care or control of a child of the marriage who has not attained the age of 18 years;
(d) commitments of each of the parties that are necessary to enable the party to support:
(i)himself or herself; and
(ii)a child or another person that the party has a duty to maintain;
(e) the responsibilities of either party to support any other person;
(f) subject to subsection (3) the eligibility of either party for a pension, allowance or benefit under -
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia,
and the rate of any such pension, allowance or benefit being paid to either party;
(g) where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable;
(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain adequate income;
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party;
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
(l)the need to protect a party who wishes to continue that party’s role as a parent;
(m)if either party is cohabiting with another person – the financial circumstances relating to the cohabitation;
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party;
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o)any other fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement that is binding on the parties.
The wife is forty years of age. The husband is forty-three. Both enjoy good health. Accordingly, these are not significant factors in the case [section 75(2)(a)].
The husband is a skilled [occupation omitted] with many years experience in his [omitted]. He earns a salary slightly in excess of $103,000.00 per annum. This employment appears to be both secure and to the husband’s liking.
On the other hand, the wife has no specialised skills of which to speak. Currently, through financial necessity, she is working two jobs. She is an [omitted] and a casual [omitted]. Her combined income from these two positions is less than half that of the husband.
As matters currently stand, the husband is significantly better placed for retirement than the wife. During the course of the marriage, the husband was able to significantly increase his superannuation entitlements, whilst the wife’s holdings have stayed more or less static. The wife, through her efforts in maintaining the parties’ household and caring for their children, has indirectly contributed to this increase in the husband’s superannuation entitlements.
The parties agree that there should be an equalisation of their superannuation holdings at the conclusion of these proceedings. I agree that such an outcome would represent a just and equitable one. The mechanism for this adjustment will essentially be via the considerations arising at this stage of the proceedings.
I accept that the most valuable “asset” a party can take out of a marriage is “a substantial, reliable income-earning capacity.”[35] In this case, the husband has such an asset, the wife does not. This is a factor which favours the wife to a significant degree [section 75(2)(b)].
[35] See Clauson & Clauson (1995) FLC 92-595 at 81,911
As a consequence of these proceedings, the parties’ primary school aged children will live with each of them for substantial and significant periods of time, whilst both are likely to be engaged in the full-time workforce for the foreseeable future.
Accordingly, both will suffer the inevitable restrictions upon working hours and choice of work and possibly will have to forego promotion opportunities because of the obligations which caring for children entails. This is not a case where one party has significantly more of the care and responsibility for [X] and [Y] [section 75(2)(c)].
The circumstances surrounding the end of the parties’ relationship together has inaugurated a period of financial austerity for each of them. I accept that both are struggling to make ends meet and that neither leads an extravagant lifestyle. This situation is likely to continue for the foreseeable future for both the husband and the wife. [section 75(2)(d)].
I am required to consider what is a reasonable standard of living for each of the parties, now that they are separated [section 75(2)(g)]. This is so that the adverse consequences of divorce do not fall more heavily on one parties’ shoulders than the other.
At this stage, to use the vernacular, I accept that both parties are “doing it tough” financially. The husband’s lot is marginally easier because of his superior income. In addition, his outgoings in respect of the Property A property are less than those which the wife incurs as a consequence of her occupation of the Property D property.
At the end of these proceedings, both parties aspire to own accommodation suitable for occupation by [X] and [Y]. Initially, both would have preferred to retain the former family home. The husband is now resiled to seeking some other residential accommodation for himself in the [W] area. He accepts that it is likely that he will have to borrow funds, secured by way of mortgage, to achieve such an outcome, but also hopes to be able to inject significant funds, in his own name, following these proceedings.
The wife also accepts that, if she is to retain the Property D property, it will be necessary for her to obtain mortgage finance. However, as previously indicated, her access to finance is limited to around $190,000.00 and will depend upon her mother providing a guarantee for the sum advanced. It is her position that considerations of justice and equity dictate that the court should give close consideration to the desirability of her being able to retain the Property D property.
I accept that it would be desirable for Ms Ackerman to be in a position to retain the property, not only for herself, but also for [X] and [Y]. I accept that the wife wishes to continue in her important role as a significant provider of care to [X] and [Y], albeit that she will also have to work, and it will be easier for her to maintain this role if she retains the former family home [section 75(2)(l)].
However, in my view, it would be fundamentally unfair to
Mr Ackerman if this outcome could only be achieved by substantially reducing the amount to which he would have otherwise been entitled pursuant to these proceedings. Regrettable as it may be, if the only way to achieve an outcome, which is just and equitable to both parties, is for the Property D property to be sold, it must be sold.
The marriage between the parties was a reasonably lengthy one. The wife leaves the marriage in a similar position, vis-à-vis her skills and employability, as she commenced it. However, be that as it may, I accept that being out of the workforce, for such an extended period of time, represents a significant detriment to the wife [section 75(2)(k)]. Over the ten years of the marriage, she was not able to study, obtain qualifications or importantly gain experience by being a participant in the workforce. This consideration favours the wife.
The weight to be attached to a child support assessment will vary in the circumstances of each particular case concerned. The court is directed to look at the amount of the assessment, the financial circumstances of each of the parties, the needs of the children concerned and whether child support is likely to be paid regularly and at an adequate rate in future.[36]
[36] See Clauson & Clauson (supra) at 81,911
I have already made findings in respect of child support issues. I do not accept that Mr Ackerman has attempted to manipulate his affairs to escape his proper level of child support. In my view, as a PAYG tax payer, his capacity to manipulate artificiality his level of income is extremely limited.
Accordingly, it seems to me to be likely that the Child Support Agency will be able to assess accurately Mr Ackerman’s level of income. In addition, as a result of these proceedings, there will be no controversy about care arrangements for the two children.
In all these circumstances, the agency will be able to apply the applicable child support formula to the circumstances of parties concerned and assess the appropriate level of child support
Mr Ackerman will have to pay to Ms Ackerman. Accordingly, I do not think that child support considerations are essential in this case [section 75(2)(na)].
The husband continues to live in the Property A property. He has indicated his desire for it to be sold, as he does not consider it suitable for his long term needs. The wife position is that it should be transferred to the husband to provide a portion of the husband’s overall entitlements from the division of the parties’ matrimonial estate.
As the property was purchased as an investment and was tenanted in the past, its ultimate sale will attract capital gains tax. The husband seeks an order that “each party shall pay such capital gains tax in respect of the sale of the Property A property as and when that falls due.” As the wife proposes the transfer of the property to the husband, her application is silent in respect of the issue of capital gains tax.
I have not been provided with any estimate of the likely quantum of the capital gains tax involved, by reference to either party’s likely marginal tax rate or any likely allowances relating to its sale. In addition I do not think I was provided with any timetable as to when Mr Ackerman proposes to put the property on the market and when it is expected to sell.
I accept however that the husband does not see his long term future in the property, although he will require it as accommodation for himself for some time, given his decision to abandon the portion of his application relating to his desire to re-occupy the Property D property.
Potentially, given the Property A property was purchased for just over $100,000.00 and is now agreed to be valued at $210,000.00, the potential for capital gains tax could be significant. However the property’s exact value and the net amount to be recouped from it can only be conclusively determined upon its actual sale.
In Rosati v Rosati[37] the Full Court discussed provided principles as to how the court was deal with issues related to capital gains tax as follows:
(1) Whether the incidence of capital gains tax should be taken into account in valuing a particular asset varies according to the circumstances of the case, including the method of valuation applied to the particular asset, the likelihood or otherwise of that asset being realised in the foreseeable future, the circumstances of its acquisition and the evidence of the parties as to their intentions in relation to that asset.
(2) If the Court orders the sale of an asset, or is satisfied that a sale of it is inevitable, or would probably occur in the near future, or if the asset is one which was acquired solely as an investment and with a view to its ultimate sale for profit, then, generally, allowance should be made for any capital gains tax payable upon such a sale in determining the value of that asset for the purpose of the proceedings.
(3) If none of the circumstances referred to in (2) applies to a particular asset, but the Court is satisfied that there is a significant risk that the asset will have to be sold in the short to mid term, then the Court, whilst not making allowance for the capital gains tax payable on such a sale in determining the value of the asset, may take that risk into account as a relevant s 75(2) factor, the weight to be attributed to that factor varying according to the degree of the risk and the length of the period within which the sale may occur.
(4) There may be special circumstances in a particular case which, despite the absence of any certainty or even likelihood of a sale of an asset in the foreseeable future, make it appropriate to take the incidence of capital gains tax into account in valuing that asset. In such a case, it may be appropriate to take the capital gains tax into account at its full rate, or at some discounted rate, having regard to the degree of risk of a sale occurring and/or the length of time which is likely to elapse before that occurs.
[37] See Rosati v Rosati (1998) FLC 92-804 at 85,043
Neither party’s counsel addressed me in respect of the issue of capital gains tax arising from the sale of the Property A property. However it seems to me that, from the evidence currently available to me, the sale of Property A must be regarded as probably going to occur in the reasonably near future and so some allowance must be made in respect of capital gains tax arising.
The wife has no need for the property. Her case remains focussed on the Property D property, which she wants to retain as her family home. In a gesture, which seems magnanimously motivated, the husband has abandoned his claim on the property. In such circumstances, it seems logical that the Property A property be transferred to him in satisfaction of his claims, particularly as it is the case that he has need of the property to provide on-going accommodation for himself and the children.
As such, the payment of capital gains tax relating to the property’s ultimate sale will fall upon him, although currently, as the property is jointly held, the liability would be shared. In my view, this is a factor which should be taken into account and is a factor which very significantly favours the husband [section 75(2)(o)].
At this stage of proceedings, the most significant feature of the case is the discrepancy in the income and financial resources of the parties and the fact that the marriage between them produced two children, who are currently of tender years. In cases such as this one, where the pool of assets available to be distributed between the parties is to be regarded as modest, the proper adjustment, in respect of factors after contribution, often becomes critical.
This is particularly so in Ms Ackerman’s case, given that, due to his initial injection of capital, the court has found contribution factors favour Mr Ackerman and her level of recurrent income, for the foreseeable future, is likely to be significantly less than the husband’s.
For reasons of this sought, the Full Court has commented, that the centre of gravity, in the determination of many property cases, has shifted towards the assessment of section 75(2) factors and, as such, court’s such as this one are directed to give the provisions concerned “real rather than token weight.”[38]
[38] See Waters & Jurek (1995) FLC 92-635 at 82,376
The wife is in her early forties. Her prospects of ever having anything other than lowly paid employment appear slim. She has limited skills. As a result of these factors, it is my view that overall consideration of the applicable section 75(2) factors favours her to a significant degree. I would assess these matters as calling for a weighting in her favour, given the size of the overall pool of somewhere between 10% and 14%.
The major section 75(2) factor favouring the husband involves the likely imposition of capital gains tax on him arising from the sale of the Property A property. The actual amount of the tax is unknown, as is when it will actually be incurred but, it is my view that considerations of justice and equity dictate that it should be taken into account in the court’s deliberations in some way. This means that there should be some discount in the amount I would otherwise have made in the wife’s favour at this stage.
In all the circumstances of this case, it is my view that it is appropriate that there be an adjustment, made in the wife’s favour, of ten percent, so far as section 75(2) factors are concerned in respect of the non-superannuation assets of the parties.
Conclusions on property
The final step in determining property proceedings is to stand back and consider whether the proposed result represents a just and equitable outcome. Considerations of justice and equity must inform each step of the court’s process and the overall result.
It is all very well to talk in percentage terms, so far as orders are concerned, but at the end of the day what really matters to the parties is what the orders mean in dollars and cents and what effect they have on their long term aspirations and level of financial security.
In cases involving modest pools, small shifts in percentage calculations can have dramatic consequences for the parties concerned. For this reason, in order to do justice and equity to each of the parties, it is important for the court to consider the practical implications of the orders which it proposes to make.
I have provisionally determined that the parties’ non-superannuation assets are to be divided equally in a proportion of 42/58% in the husband’s favour. 42% of the net valuation of the pool of assets is represented by the sum of $231,249.90. 58% by the sum of $319,345.10.
If the wife retains Property D, as is her wish, subject to its existing mortgage, she will have a net asset to the value of $344,902.00. In addition, the insurance payment relating to the write off the family car must be accounted as an asset in her possession. Accordingly, she currently controls net assets to the value of $358,602.00.
If the husband, nominally at least, retains the Property A property, which I anticipate will be his residence for at least the short term, he will have a net asset to the value of $138,802.00. In addition, if he retains the cash in the family trust and his motor vehicle, he will have assets to the value of a further $53,191.00. The total of these two sum being $191,993.00.
Accordingly, if this status quo in regards to possession of property is to be maintained in the final orders, it will be necessary for the wife to pay the husband a further sum of $127,352.10.
This is a significant sum for the wife to find, particularly given she is a modest wage earner and has a heavy burden of debt arising from her legal costs. However, on her evidence, she has the capacity to borrow this sum, albeit that her mother will have to guarantee the sum.
The current mortgage on Property D is modest, currently standing at just over $10,000.00. The wife’s evidence is that she can borrow up to $190.000.00. Accordingly, the proposed outcome will see the wife with a liability to her mortgage financier in a sum of around $140,000.00. I acknowledge that the burden of repaying this sum will be significant for the wife. But she is currently forty years of age and so is likely to have twenty years at least in the workforce.
Interest only on this sum, at a rate of 7.5%, would be $10,500.00 per annum or $200.00 per week. Accordingly the wife, in repaying the sum, although her income is modest has some margin for error, it seems to me. I concede of course that future rates of interest cannot be predicted.
The husband is likely to sell Property A so he can move to a larger home more suitable for his and the children’s needs. As such, he is likely to incur expenses in respect of the sale of the property and also capital gains tax. However, the outcome I envisage sees him retaining the parties’ cash holdings, in the form of the family trust, which will provide Mr Ackerman with some flexibility in respect of changing his place of residence and paying any tax arising.
As indicated above, I have taken into account the capital gains tax under the provisions of section 75(2)(o) and by reducing the weighting in the wife’s favour which I would otherwise have made in respect of the other section factors arising under the section which favour her to a marked degree.
This outcome also leaves Mr Ackerman with a sum in excess of $300,000.00. This should enable him to re-accommodate himself, although probably with some form of mortgage. However, the reality of his situation, given his superior income earning capacity, he has a far greater facility than the wife to recover from the financial disaster which the end of the parties’ marriage represents for each of them.
In all the circumstances, I have come to the conclusion that the outcome I propose represents a just and equitable one and will make orders to give it effect. In so doing, I will round up the sum to be paid by the wife to the husband to the sum of $128,000.00. I will allow her thirty five days to find the sum in question.
The parties have agreed that there should be an equalisation in their superannuation assets. Such an outcome will leave them holding $67,896.00 in superannuation each. This will require a split to be made, in a sum of $34,922.00, in the wife’s favour, from the husband’s superannuation. I will round this sum up to $35,000.00.
Both parties are some time away from retirement from the paid workforce. This outcome will leave neither the wife nor the husband well prepared for retirement. However, once again, the husband is likely to be able to replenish his depleted superannuation far quicker than the wife by dint of his superior income earning capacity. Again, I am satisfied that this equal division of superannuation represents a just and equitable outcome.
Like all other factors in this case, the composition of any particular set of orders, in terms of the proportion of non-superannuation as opposed to superannuation assets, which each party ultimately receives and the percentage basis of such awards must be determined by considerations of what is just and equitable in the overall circumstances of the case.
The relevant factors in determining how the mix of assets between parties is made up is likely to include the following:
·the purchase price of appropriate accommodation and rehousing costs for each of the parties concerned;
·the need to provide some form of financial buffer to cover each of the parties concerned in respect of the ordinary exigencies arising from independent living;
·the current level of the parties’ superannuation and any discrepancies thereon;
·the probability of the parties being able to acquire appropriate superannuation benefits from any future income;
·any discrepancies in the income earning capacity of the parties concerned, which will have implications in respect of any capacity to borrow monies in future in order to finance the purchase of future accommodation.[39]
[39] See L & L (2006) FLC 93-254
The outcome to be ordered by the court, in my view, leaves both parties with the capacity to be able to purchase suitable accommodation for themselves. Each has the same level of superannuation. The orders envisage some degree of flexibility to deal with unseen future exigencies of life, although I concede that the husband is more secure in this regard than the wife. Most importantly, the orders take into account the husband’s far superior level of income. As such, I am satisfied that the outcome I propose represents a just and equitable one in all the circumstances.
For all these reasons, the orders of the court will be as set out at the commencement of these reasons for judgment.
I certify that the preceding four hundred and seventeen (417) paragraphs are a true copy of the reasons for judgment of Brown FM
Associate:
Date: 20 February 2013
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