Adair & Adair

[2019] FamCAFC 70

Family Court of Australia

ADAIR & AdAIR

[2019] FamCAFC 70

FAMILY LAW – APPEAL – PROPERTY – Where the primary judge made property settlement orders providing for three parcels of real property exclusively held by the husband to be transferred to the wife – Where the three parcels of real property were the parties’ only alienable assets – Where the appellant husband was unable to demonstrate he was not afforded procedural fairness – Where various findings made by the primary judge were open on the evidence – Where the primary judge gave sufficient reasons for the findings made – Where the Full Court considers admissibility of evidence under the Evidence Act 1995 (Cth) and the Family Law Act 1975 (Cth) – Where the primary judge’s consideration of findings made by another judge in relation to family violence was valid – Where the primary judge made no discretionary error in applying Kennon & Kennon (1997) FLC 92-757 to property settlement orders – Where the primary judge’s adjustments made pursuant to ss 75(2) and 79(4) of the Family Law Act 1975 (Cth) were just and equitable – Where no appealable error established – Appeal dismissed.

FAMILY LAW – APPEAL – COSTS – Where no merit in appeal – Where the appellant abandoned grounds of appeal before or during the appeal – Where the remaining grounds of appeal were wholly unsuccessful – Where the appellant is ordered to pay the respondent’s costs of and incidental to the appeal in a fixed amount.

Evidence Act 1995 (Cth) ss 91, 93, 135, 136, 190

Family Law Act 1975 (Cth) ss 69ZM, 69ZT, 69ZX, 75(2), 79(4)

Clauson and Clauson (1995) FLC 92-595; [1995] FamCA 10

De Winter and De Winter (1979) FLC 90-605

Farmer and Bramley (2000) FLC 93-060; [2000] FamCA 1615

Gronow v Gronow (1979) 144 CLR 513; [1979] HCA 63

House v The King (1936) 55 CLR 499; [1936] HCA 40

Kennon v Kennon (1997) FLC 92-757; [1997] FamCA 27

National Companies & Securities Commission v News Corporation Limited (1984) 156 CLR 296; [2012] HCA 29

Norbis v Norbis (1986) 161 CLR 513; [1986] HCA 17

RCB v Honourable Justice Forrest (2012) 247 CLR 304; [2012] HCA 47

Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1; [2003] HCA 6

Stead v State Government Insurance Commission (1986) 161 CLR 141; [1986] HCA 54

Appellant:

Mr Adair

Respondent:

Ms Adair

File Number:

PAC
3305

of
2013

Appeal Number:

EA
60

of
2018

DATE DELIVERED:

29 April 2019

Place Delivered:

Newcastle

Place Heard:

Sydney

Judgment of:

Strickland, Ryan & Austin JJ

Hearing date:

1 March 2019

Lower court jurisdiction:

Family Court of Australia

lower court judgment date:

18 April 2018

LOWER COURT MNC:

[2018] FamCA 239

REPRESENTATION

COUNSEL FOR THE Appellant:

Mr Bennett

SOLICITOR FOR THE Appellant:

Adam Jones Solicitor

SOLICITOR FOR THE RESPONDENT:

Mr Bainbridge, Bainbridge Legal

Orders

(1)      The appeal be dismissed.

(2)      The appellant pay the respondent’s costs of and incidental to the appeal, fixed in the sum of $15,000 within 28 days of the date of these orders.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Adair & Adair has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

THE FULL COURT OF THE Family Court of Australia at SYDNEY

Appeal Number: EA 60 of 2018

File Number: PAC 3305 of 2013

Mr Adair

Appellant

And

Ms Adair

Respondent

REASONS FOR JUDGMENT

1.        The husband appeals against the property settlement orders made by a judge of the Family Court of Australia on 18 April 2018 pursuant to Part VIII of the Family Law Act 1975 (Cth) (“the Act”), which appeal is resisted by the wife.

2.        The appealed orders oblige the husband to transfer to the wife three parcels of real property at Suburb Q, Suburb O and L Street, Suburb M, all of which were exclusively owned by him. In effect, the three properties comprised the entirety of the parties’ alienable assets. The parties did not seek any orders to adjust their interests in miscellaneous items of personal property and neither party had any superannuation interest.

3.        The husband’s appeal should be dismissed with costs for the following reasons.

Grounds of appeal

4.        At the commencement of, or during the appeal, Grounds 8, 11 and 12 were abandoned.

5.        The remaining grounds are not addressed in the same order as they were argued.

Procedural fairness (Ground 7)

6.        The husband contended he was denied procedural fairness because he was led to believe during the trial that the three properties would be sold, but the primary judge instead ordered him to transfer all three properties to the wife.

7.        There can be no doubt procedural fairness is an essential characteristic of any judicial proceeding (see RCB v Honourable Justice Forrest (2012) 247 CLR 304 at 309, 321). The real questions are: what did the obligation of procedural fairness entail in the particular circumstances of the case at hand and, if there was some degree of unfairness, was it material to the outcome? Those questions are integral because the concept of natural justice does not require the application of a fixed body of rules in all situations (see National Companies & Securities Commission v News Corporation Limited (1984) 156 CLR 296 at 312) and not every departure from the rules of natural justice at the trial will entitle the aggrieved party to a new trial (see Stead v State Government Insurance Commission (1986) 161 CLR 141 at 145).

8.        The background is contextually important to this ground. At trial, of the husband’s three properties, the wife applied for two of them to be transferred to her with the third to be sold and its net proceeds divided between the parties in certain proportions. The husband revised his proposal just prior to trial and embarked upon the trial proposing that all three properties be sold and the net proceeds divided between the parties in given proportions. The only evidence of the properties’ values was that adduced by the wife in reliance upon the single expert’s opinion, which was nearly two years old at the time of trial. During the husband’s final submissions, the issue about the parties’ competing proposals was addressed in the following way:

[SOLICITOR FOR THE HUSBAND]: … My final submission, your Honour, when you’re looking at the competing applications between the parties, is that the valuations that were used to provide the values for the property on the balance sheet, and [are] now almost two years old …

[HER HONOUR]: Everybody seems to agree that everything needs to be sold, don’t they?

[SOLICITOR FOR THE HUSBAND]: Then I won’t make any – that’s – I don’t know if that’s the wife’s case but that is my submission in order to – yes. Is there anything the [C]ourt would like…

(Transcript, 27 March 2017, p.216 line 41 to p.217 line 2)

9.        Given the manner in which the trial was conducted it is hardly surprising that the primary judge sought some clarification of the parties’, then current, proposals. Although the factual premise of the question posed by her Honour was incorrect, because the wife did not agree that “everything needs to be sold”, her Honour was not corrected by either party’s advocate.

10.      Judgment was reserved following final submissions and, when the decrees were later pronounced and the reasons delivered, the reasons contained the following:

154.    The wife obtained valuations of those properties in 2016. No valuations were relied upon by the husband.

155.    Since both parties ask the Court to order the sale of the real estate, the issue of value has less significance as the orders will require the sale of the three properties and the distribution of the net proceeds of sale in accordance with the percentages which will be determined.

…

186.    In those circumstances, the wife will receive the whole of the real estate assets of the marriage …

187.    Since the wife will receive the three parcels of property, she should not be required to sell them if she wishes to retain any of them. The wife gave evidence that her preference, if it were possible, would be to demolish [L Street] and build a new home on the block. She should be allowed to do so if she wishes.  

11.      What then, it may be asked, was the procedural unfairness suffered by the husband? He articulated it thus:

… [The husband’s solicitor] never had an opportunity to address the Court on an order that the wife would receive all of the significant assets held in the husband’s name. …

(The husband’s Summary of Argument, filed 23 October 2018, p.6)

12.      The submission must be rejected. The parties contested the trial on the basis that, apart from a fourth parcel of real property at R Street, Suburb M (“the Suburb M property”) (owned by the husband’s disabled brother, the second respondent in the trial proceedings), in relation to which the wife unsuccessfully argued for a declaration of her beneficial interest, the three parcels of real property owned by the husband were the only items of property amenable to any adjustment order between them. The husband’s solicitor was free to make any submission he liked about the parties’ proportional entitlements to those properties. He was certainly not denied procedural fairness on that score.

13. Both parties conceded, pursuant to s 79(2) of the Act, that it would be just and equitable for adjustment orders to be made in relation to the three properties. In fact, the husband conceded the wife’s proportional entitlement to the properties exceeded one-half, though he was eventually unspecific about the precise measure of her larger share. That being so, the primary judge was obliged to make just and equitable adjustment orders between the parties, which orders need not coincide with the suite of orders propounded by either party. The mere fact the orders made by the primary judge differed from those proposed by either party does not vindicate this ground of appeal.

14. If it is instead assumed the husband’s complaint is more accurately directed to his deprivation of an opportunity to address the primary judge on the practical form of the adjustment orders (as distinct from the parties’ proportional entitlements to the property) because he was led to expect an order would be made for all three properties to be sold, he is no better placed. Once her Honour concluded the wife’s entitlement under Part VIII of the Act extended to the whole of the husband’s legal interest in the three properties (assuming that conclusion is defensible against other grounds of appeal posited by the husband, yet to be addressed), it was immaterial to him whether the orders provided for the properties to be transferred to her in specie, or alternatively, the properties to be sold and the entire net proceeds of sale paid to her. Once it was determined all of his proprietary interest in the properties was to be relinquished, the form of the order was inconsequential to him.

15.      Although the husband might reasonably have been left with an expectation by the primary judge’s comments, made during the final submissions, that orders would be made for the three properties to be sold, the frustration of that expectation did not elevate his surprise at the outcome to his denial of procedural fairness. Not every departure from a stated intention by a primary judge necessarily involves unfairness, even if it defeats a litigant’s expectation (Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 12-13).

16.      This ground of appeal fails.

Alleged erroneous findings (Grounds 3, 4 and 5)

17.      By these grounds of appeal, the husband contended the primary judge erred by making certain findings of fact, namely: the Suburb M property was an ongoing financial resource for him (Ground 3); he had undisclosed assets (Ground 4); and he would be able to continue living in his deceased mother’s home (Ground 5). It is necessary to deal with each of those grounds sequentially.

18.      In relation to the Suburb M property, the primary judge relevantly found:

15.      In 2002, a property was purchased at [Suburb M] for $288,000. The registered proprietor was the husband’s brother, [the second respondent]. There was a mortgage from [the second respondent] to the Commonwealth Bank in the sum of $136,000.

16.      [The second respondent], in 2002, was suffering from a psychiatric illness and was incapable of managing his own affairs.

17.      The source of the money for the purchase, the circumstances of the purchase, the use to which the rent was put and the ultimate beneficial ownership of [the Suburb M property] are issues in these proceedings. The wife and her two adult children who gave evidence assert that on numerous occasions the husband told them that [the Suburb M property] was “our house in [the second respondent]’s name”.

18.      In May 2007, the husband took out a mortgage with the ANZ Bank secured over [the Suburb M property]. He repaid the mortgage to the Commonwealth Bank taken out in [the second respondent]’s name and thereafter the payments on the ANZ mortgage were made by the husband. There is a dispute as to the source of the funds used to repay the mortgage.

…

20.      In September 2011, the husband received a cheque for $53,641.22 from the real estate agent managing the rental of [the Suburb M property]. The husband deposed that he gave that money to the wife who spent it. The wife disputes that assertion. The ultimate disposition of those funds is an issue to be determined.

…

45.      It is difficult, if not impossible, to unravel the transactions relating to [the Suburb M property]. Documents which might have assisted were not made available.

46.      It is to be remembered that, at all material times, [the second respondent] was suffering from a disability and not able to manage his own financial affairs.

…

53.      The husband consistently said, in cross-examination, that he had nothing to do with the financing of [the Suburb M property]. That assertion seems to be contrary to his position before the Registrar which appears to be a concession that he contributed $100,000 as the wife alleged.

54.      [The Suburb M property] was purchased in September 2002 for $288,000. The registered proprietor is [the second respondent]. A mortgage was obtained from the Commonwealth Bank to secure an advance of $136,000, signed by [the second respondent] as mortgagor. The husband witnessed the signature of his brother. Thus, on the husband’s case some $152,000 (plus costs and stamp duty) was provided by [the second respondent].

55.      There was no evidence of [the second respondent]’s financial position or how he, a person under a disability, unable to manage his financial affairs, was able to provide in excess of $400,000 to finance the purchases of [a property at Suburb Y] and [the Suburb M property].

…

59.      The husband has treated [the Suburb M property] as if it were his own and has obtained the benefits of ownership.

60.      I accept the evidence of the wife that the husband frequently told her that he was the real owner of the property and that they inspected the property and chose which bedrooms would be used for the children and themselves and how rooms would be used when they moved into the property.

…

68.      In May 2007, the husband borrowed $131,135 from the ANZ Bank on the security of [the Suburb M property]. How he was able to do that was unexplained. Presumably, [the second respondent], despite his lack of capacity, signed whatever documents were required by the ANZ Bank. The mortgage in the name of [the second respondent] with the Commonwealth Bank, of about $113,000, was discharged. The husband gave no explanation of what he did with the balance of the advance.

…

75.      The husband was responsible for the maintenance of [the Suburb M property] and both the husband and the wife cleaned the property between tenants. 

…

83.      Also annexed to the wife’s affidavit was a letter signed by [the second respondent], dated 12 September 2013, addressed to the Commissioner of Taxation authorising the husband to represent him in any financial matter.

84.      When there was a complaint by the tenants to the Residential Tenancy Tribunal about the condition of [the Suburb M property] in August 2007, it was the husband who appeared at the hearing.

…

88.      [The parties’ adult son] also deposed to a conversation between his parents in about 2007 where the husband told the wife that he would save the rent money from [the Suburb M property] to accumulate funds to build a house. (The wife gave evidence of conversations about demolishing one of the existing houses and rebuilding). [The parties’ adult son] deposed that the husband then told the wife that she was to make the mortgage payments using cash that he would give her.

…

91.      The husband in cross-examination said that he had proposed during the marriage that the family could live in [the Suburb M property] while they renovated [L Street]. Such a proposal is consistent with the husband treating the property as his own.

…

93.      From at least 2007, when the husband repaid [the second respondents]’ mortgage and took over the burden of the debt, the mortgage over [the Suburb M property] was paid from the parties’ funds and the husband received the rents.

94.      The most likely scenario is that the husband obtains the benefit of the property by using [the second respondent]’s accounts and having [the second respondent] sign documents to enable him to utilise the rents.

95.      Whilst I am not satisfied that the husband is the beneficial owner of [Suburb M], I am satisfied that he treats the property as his own and that only he receives any benefits of ownership.

…

171.    The husband and the wife both cleaned and prepared [the Suburb M property] between tenants.

…

180.    The husband received some $116,000 from the sale of [another property at Suburb T] for which he has not accounted. In addition he has received $53,641 from the rents of [the Suburb M property] and probably received a further $11,654 from the same source. Those funds amount to some $181,295.

181.    Further, the husband borrowed $131,135 to discharge [the second respondent]’s mortgage over [the Suburb M property], a property in which he maintained he had no legal interest. Between May 2007 and April 2013, a period of six years, the husband made mortgage payments on that loan of about $915 per month, a total of about $66,000, and in April 2013 he paid $117,000 to discharge that mortgage. Thus a further $183,000 of family funds was diverted, the husband would say, to [the second respondent]’s property.

…

19. None of those factual findings was challenged in the appeal by the husband as being unavailable or wrong, in which event the findings were properly relied upon by the primary judge to determine the percentage adjustment in the wife’s favour under s 75(2) of the Act.

20.      During final submissions, the primary judge invited the husband’s solicitor to address why it should not be concluded that the Suburb M property was a financial resource of the husband, with which issue the husband’s solicitor then engaged. Although the primary judge did not eventually describe the Suburb M property as the husband’s “financial resource” in the reasons for judgment, her Honour did say:

147.    …I have no confidence that the husband has disclosed all of his assets and particularly his ability to draw on the assets of [the] disabled [second respondent] at will.

…

187.    …The husband will retain the benefit of [the Suburb M property] which I am satisfied that he has, notwithstanding the property being in [the second respondent]’s name…

21.      Given the extracted findings about the second respondent’s ownership of the Suburb M property (despite his cognitive incapacity), the lack of clarity about how the purchase of the Suburb M property was funded, the husband’s re-finance of the mortgage over the Suburb M property, the husband’s payment of the Suburb M property’s mortgage from at least 2007, the husband’s receipt of rents from the Suburb M property, the parties’ past maintenance of the Suburb M property, and the husband’s outward treatment of the Suburb M property as his own, there was a substantial factual platform for the primary judge to regard the property as a financial resource to which the husband could resort at will.

22.      The husband’s submission that the primary judge ought to have found he would desist from using the Suburb M property as his own by reason of his appointment as the second respondent’s guardian, in or about December 2016, did not advance the appeal. The inference the husband would rely upon his appointment as official authority to use and minister the Suburb M property as he always had was just as available. Accordingly, Ground 3 must fail.

23.      Turning to Ground 4, the primary judge found the husband’s financial disclosure was deficient and determined his evidence would not be accepted as credible, unless independently corroborated, which conclusions were expressed thus:

146.    It follows from the detailed account of the husband’s evidence which is set out earlier in these reasons, that I do not accept him as a witness whose evidence can be given any weight at all unless corroborated by independent documents.

147.    Neither do I accept that the husband has made any attempt to give full and proper disclosure of the financial dealings in which he engaged throughout the marriage. I have no confidence that the husband has disclosed all of his assets and particularly his ability to draw on the assets of [the] disabled [second respondent] at will.

…

158.    Apart from the real estate, the wife has personal property of minimal value which I do not propose to include for the purpose of distribution, in circumstances where the husband has not filed an updated Financial Statement, despite having been ordered to do so. In any event, the husband’s evidence about his financial position would not be accepted absent documentary corroboration.

24.      It is first necessary to correct the assertion inherent in this ground. The primary judge did not positively find the husband possessed undisclosed assets, as the ground alleged. Rather, the primary judge only lacked confidence he had disclosed all of his assets. There is a marked difference between the two because the former speaks of probable non-disclosure, whereas the latter merely the possibility of it. While this ground contended the primary judge erred by making any finding about the husband’s lack of disclosure, the husband’s submissions in support of the ground instead asserted her Honour’s error was the failure to “set out the facts upon which [the] finding was based”. Regardless of whether the asserted error is one of mistake or the absence of reasons, it is not established.

25.      In advance of trial, the husband was ordered to file an updated Financial Statement, but he did not do so. Even if his omission was an oversight, it still amounted to the failure to disclose his current financial circumstances.

26. Her Honour then found his evidence proved to be unreliable in relation to various financial conflicts between the parties. For example: he gave evidence about his derivation of income from paid employment over the course of the marriage, which the wife disputed, but he inexplicably failed to tender his available taxation returns which were capable of corroborating his evidence, enabling the inference to be drawn that his evidence was inaccurate (at [31] –[36]); he gave inconsistent evidence about how land at Suburb T was purchased (at [37] – [44]); he gave inconsistent evidence about how the net proceeds of sale of the Suburb T land were spent (at [119] –[120]); he gave inconsistent evidence about how the Suburb M property was purchased and re-financed (at [48] –[49], [68]-[70]); he gave inconsistent evidence about his use of the rents from the Suburb M property (at [76] – [80]); he gave inconsistent past accounts about how the L Street property was purchased (at [96]-[98]); he gave inconsistent past accounts about how the Suburb Q property was purchased (at [100] - [102]); he failed to disclose his interest in his deceased mother’s estate and his purported surrender of it, which failure was exposed during his cross-examination (at [128] – [133]); and he failed to disclose to Centrelink his ownership of the three properties (at [148]).

27.      In such circumstances, the primary judge’s findings about the husband’s unreliability and her Honour’s lack of confidence about the extent of his financial disclosure were hardly surprising. The findings were certainly open and were sufficiently explained, in which event Ground 4 fails.

28.      Ground 5 was directed to the primary judge’s finding in relation to the husband’s future occupation of his late mother’s home, but it is again necessary to correct inaccuracy in the husband’s grounds. The primary judge did not positively find the husband “is able to continue living” at that property, as the ground alleged. Rather, her Honour found he lived in the property at the time of trial (at [133], [184], [186]), and further, there was “no evidence” he would not be able to continue doing so (at [186]).

29. The parties separated in May 2013. Proceedings between the parties under the Act were instituted in August 2013. The husband’s mother died intestate in May 2016 and so her home devolved to her seven children in equal shares. Her home was transmitted into the beneficiaries’ joint names in January 2017 but, only two days later, the husband transferred his proprietary interest in the home to one of his siblings, without the wife’s knowledge and ostensibly for no consideration (at [22], [129] – [133]). Despite having transferred his interest in the home to his sibling some six months before, the husband deposed in July 2017 that he still lived in the property with that sibling. When he entered the witness box at trial in March 2018 he asserted he then lived in his Suburb O property and, during cross-examination, he asserted he moved into that property from his late mother’s home in 2017, prior to which he had lived in his late mother’s home (presumably with her or one or more of his siblings) from the time of the parties’ separation in 2013.

30.      In light of the husband’s evidence about having moved out some time in 2017, about which he was not challenged, much less contradicted, it was not reasonably open for the primary judge to find the husband still lived at his late mother’s home at the time of trial. But the factual mistake was immaterial because it did not taint the subsequent finding that there was no evidence he could not live in his late mother’s home. The husband’s evidence was that two of his brothers lived in their late mother’s home and he only vacated it to live in one of his own properties because he “couldn’t look after two properties at the same time”. As the primary judge ordered the husband to transfer to the wife all three of his real properties, including the Suburb O property in which he then lived, those properties would no longer be available for his accommodation. There was, indeed, no evidence the husband could not then move back to occupy his late mother’s home with his two brothers, as he had done for years before. Ground 5, therefore, fails.

Reliance upon past findings (Ground 10)

31. The primary judge heard and determined only the parties’ property settlement dispute under Part VIII of the Act. Their dispute over parenting orders under Part VII of the Act was heard and determined by another judge (Hannam J) of the Family Court of Australia in 2016.

32.      By this ground of appeal, the husband contended the primary judge erred by relying upon and using in the property dispute the earlier findings of Hannam J.

33.      Relevantly, the primary judge recorded that Hannam J made orders and findings in the parenting proceedings to the following effect:

6.        There were proceedings in relation to the parenting of the children which were determined by Hannam J who delivered judgment on 11 May 2016. As a result of those proceedings, the wife has sole parental responsibility for the children and they spend no time with the husband. Hannam J found that the husband had perpetrated family violence against the wife and the children and, in the case of the wife, also perpetrated controlling behaviour.

…

134.    On 11 May 2016, Hannam J made orders restraining the husband from approaching, contacting or communicating with the wife and the three youngest female children.

135.    Those orders were made after a hearing where Her Honour found that the husband controlled the family’s finances, scrutinised the wife’s spending and required her to produce receipts to substantiate her spending.

136.    Her Honour found:

I am satisfied that the father did engage in behaviour that coerced and controlled the mother and the children throughout the relationship. Virtually none of the mother’s evidence was challenged in this regard either under cross-examination or in the father’s own affidavit and documents from independent sources such as police provide corroboration for the mother’s contention.  The father’s own evidence about the mother needing to seek his permission to travel and about monitoring the whereabouts of his children support the contention that the father was controlling in his interaction with family members.

…

140.    Hannam J found that the husband had assaulted the mother and his three oldest daughters and that the risk that he would assault the three youngest daughters was unacceptable.

34.      The primary judge’s reference to those findings, together with other established facts, was followed by conclusions to this effect:

144.    I am persuaded that the circumstances of this case, where the husband has assaulted not only the wife but each of his three eldest daughters, are exceptional such that an adjustment should be made in favour of the wife.

145.    I accept that the wife’s parenting and home-making contributions were made more arduous by both the husband’s control of their finances and his violence towards her and his daughters.

35.      The husband acknowledged the law does enable findings of one spouse’s violent conduct towards the other to reflect in that way in property settlement orders (Kennon & Kennon (1997) FLC 92-757 (“Kennon”)). He also acknowledged the primary judge could permissibly rely upon her own sound findings about his violent conduct for that purpose. By this ground of appeal, he only contended it was impermissible for the primary judge to rely upon the prior findings of Hannam J.

36.      In support of that proposition, the husband relied upon certain provisions of the Evidence Act 1995 (Cth) (“the Evidence Act”). He asserted that Hannam J’s findings about his past violent conduct were not admissible in the property settlement proceedings (s 91 of the Evidence Act) and were not rendered admissible by reliance upon principles of res judicata or issue estoppel (s 93(c) of the Evidence Act). If those submissions did not clinch the argument, the husband contended the primary judge should have rejected or limited the use of the evidence of Hannam J’s findings in the exercise of her discretion (ss 135 and 136 of the Evidence Act). For the reasons which follow, his submissions must be rejected.

37. The provisions of the Evidence Act certainly applied because the proceedings before the primary judge were not “child-related proceedings” (s 69ZM of the Act), in which event s 69ZT(1) of the Act did not operate so as to exclude tranches of the Evidence Act from operation. For clarity, s 69ZX(3)(b) of the Act did not render either Hannam J’s decision or findings admissible in the proceedings before the primary judge.

38. Section 91 of the Evidence Act only operates to prevent the use of prior curial decisions and findings of fact to prove the existence of facts which are the subject of dispute in subsequent proceedings. Before the primary judge, it was not controversial the husband had behaved violently towards the wife and the children, so the existence of that basal fact was not genuinely in issue. However, there were live factual disputes in the proceedings before the primary judge as to the severity and duration of the husband’s violent conduct.

39. Importantly, s 190(1) of the Evidence Act enables a court, with the parties’ consent, to dispense with the application of various provisions of the Evidence Act, including Part 3.5, within which s 91 is located.

40.      The reasons for judgment given by Hannam J in the Part VII proceedings were annexed to the wife’s affidavit. No objection was taken by the husband at the trial to the admissibility of Hannam J’s reasons. In fact, the husband’s solicitor said to the primary judge, implying his acceptance of both the relevance and probative value of Hannam J’s findings:

…There have been findings of fact made in another court in relation to  [the husband’s violent conduct]…

(Transcript, 27 March 2018, p.182 line 22)

…notwithstanding the very unpleasant nature of the allegations – well, the facts that were found by Hannam J, and also the local court Magistrate…

(Transcript, 27 March 2018, p.214 lines 35 – 36)

41. The inference could hardly be clearer – the parties consented to the dispensation of Part 3.5 (including s 91) of the Evidence Act in respect of Hannam J’s findings.

42. Even if such agreement cannot be imputed, it was incumbent upon the husband to take the evidentiary objections he considers were warranted. Section 91 of the Evidence Act only blocks the admissibility of evidence. If an objection is not taken to avail of the impediment (or the evidence is not rejected by the Court of its own volition) and the evidence is received, it can be put to use. We reject the husband’s argument that s 91 of the Evidence Act constitutes an absolute bar to the use of a prior decision or finding of fact, for otherwise s 190(1) of the Evidence Act would not envisage the prospect of its dispensation. Parties are bound by the manner in which they tactically conduct the trial and it is impossible to discern on appeal whether the decision to abstain from making a valid evidentiary objection at trial was an intentional forensic tactic (even if ill-conceived) or simply an oversight. Obviously, it would be perverse if a party could make a tactical decision at trial to allow objectionable evidence to be admitted, but then contend on appeal the admission of that evidence warrants the unfavourable decision being set aside.

43.      In any event, quite apart from the findings previously made by Hannam J, the primary judge’s ultimate findings about the husband’s violent conduct and the consequent application of Kennon principles in the Part VIII proceedings hinged upon various other pieces of evidence and concessions made on behalf of the husband, which may be conveniently summarised as follows:

(a)       The wife deposed in her affidavit, at length, to the husband’s past violent conduct towards her and the children. No objection was taken by the husband to the admissibility of that evidence. Nor did he challenge the wife about the truth of that evidence (at [141]).

(b)      Business records created by the police were tendered in evidence by the wife (Exhibit 9). The exhibit corroborated the wife’s evidence about the husband’s violent conduct and established two important things. First, he was charged with multiple counts of assaulting the wife and the children in 2008 and 2009, but the charges were dismissed when the wife declined to give evidence against him in the prosecution. Second, he was charged and convicted for assaulting the wife and one adolescent daughter in 2013. No objection was taken by the husband to the admissibility of that evidence (at [138]-[139]).

(c)      The parties’ now adult daughter gave evidence of the husband’s past financially controlling behaviour. No objection was taken by the husband to the admissibility of that evidence. Nor did he challenge the witness about the truth of that evidence (at [137]).

(d)      Evidence was adduced of an admission made by the husband in a past loan application that their family of ten subsisted on only $940 per month (at [137]), which evidence correlated with the husband’s admission in final submissions that it “may very well have been the case” that the wife was “being controlled financially [by the husband]”.

(e)      The husband’s solicitor also conceded during final submissions that the evidence proved serious past violent conduct by the husband, even though there remained some dispute about the period over which it persisted during the marriage, and further, that it caused the wife’s contributions to be more arduous. The concessions made by the husband’s solicitor amounted to admissions of fact from which he cannot now resile. Those admissions were to the following effect:

…the majority of the domestic violence occurred towards the breakdown of the marriage…

(Transcript, 27 March 2018, p.215 lines 44 – 45)

…the proven instances of domestic violence, very disturbing, relate to two incidents. Two incidents; one in 2008, and one in 2013, and while those certainly did increase to (sic) the arduous nature of the wife’s contributions…

(Transcript, 27 March 2018, p.216 lines 5 – 8)

…and not discounting the fact that I think that the wife had a terrible time, and probably the children during the marriage (sic)…

(Transcript, 27 March 2018, p.216 lines 16 – 17)

44.      Thus, regardless of the findings made by Hannam J, there was an abundance of other evidence and admissions upon which the primary judge could properly rely to find the husband acted towards the wife in a violent and controlling way during their marriage. The corollary is that, even if the husband could now competently complain in retrospect about his failure to object to and establish the inadmissibility of Hannam J’s findings at the trial, he is no better placed, since the appealed decree is still sound. The ultimate finding was nevertheless so plainly right that it could be allowed to stand notwithstanding any unsoundness of some of its foundations (De Winter and De Winter (1979) FLC 90-605 at 78,091 – 78,092).

45. The husband’s submission in the appeal that the primary judge ought to have rejected the evidence of Hannam J’s findings, pursuant to ss 135 or 136 of the Evidence Act, because the evidence was unfairly prejudicial to him, did not advance his appeal. The primary judge gave no consideration to those provisions because they were not raised. No objection was taken by the husband to the admissibility of Hannam J’s findings on any ground at all. Nor did he submit that the evidence should only be used in a limited way. The primary judge’s decision was validated by other admissible evidence so the husband was in no danger of any unfair prejudice by the reception of the inadmissible findings of Hannam J.

46.      This ground of appeal fails. 

Alleged discretionary error – Kennon (Ground 6)

47.      By this ground, the husband sought to contend the primary judge erred by being satisfied that the wife’s contributions deserved greater weight in the determination of just and equitable property settlement orders on account of them being made more arduous because of his violent conduct towards her, consonant with Kennon principles. Specifically, he contended there was an insufficient evidentiary link between his “alleged family violence” and the arduousness of the wife’s contributions: a link he plainly admitted at trial, as explained above in relation to Ground 10.

48.      It is first necessary to correct the inherent error of the ground. The “family violence” perpetrated by the husband was not merely “alleged”; it was comprehensively proven. At the very least, his conviction in 2013 for assaulting the wife is conclusive proof of his family violence, though the wife adduced much more evidence than simply that. The only room for factual dispute concerned the severity and duration of the husband’s violent conduct; the findings about which facts naturally influenced the Kennon finding.

49.      It is next necessary to observe the disparity between the ground of appeal and the submissions made in support of it. While the ground alleged an erroneous finding, the submissions alleged the quite different error of insufficient reasons to explain it. Both asserted errors are not demonstrated. The Kennon finding was open and was sufficiently explained. It is only necessary to recite some of the primary judge’s reasons to demonstrate that is so:

137.    Before me, the parties’ adult daughter […] gave evidence of a childhood of deprivation where fresh food was not purchased and clothes were from charities. That evidence is consistent with the husband’s assertion in his loan application to the ANZ Bank in 2007 that the whole of the monthly expenses, for this family of ten, amounted to $940.

138.    On or about 30 July 2009, the father was charged with six counts of common assault upon the mother in July 2008; upon an adult daughter then a minor child in January 2009; and upon the same daughter and the mother in July 2009. Those charges were dismissed when the mother and the children refused to give evidence against the husband. I accept that they did so because they were afraid.

139.    In May 2013 the husband was charged again with assaulting his daughter, then aged 17 years, and with assaulting the mother. He was convicted, after a hearing, of both offences. An Apprehended Domestic Violence Order (ADVO) was issued against the husband for the protection of the mother and two of his daughters for two years. The husband appealed against the making of that order but the appeal was dismissed.

…

141.    In her trial affidavit, the wife deposed to various instances of family violence including physical violence and financial control exerted by the husband during the course of their marriage. These allegations were not challenged.

142.    I am conscious of the requirement, in cases where the effect of family violence is being assessed, that the circumstances must be exceptional.

…

144.    I am persuaded that the circumstances of this case, where the husband has assaulted not only the wife but each of his three eldest daughters, are exceptional such that an adjustment should be made in favour of the wife.

145.    I accept that the wife’s parenting and home-making contributions were made more arduous by both the husband’s control of their finances and his violence towards her and his daughters.

50.      Those factual findings reasonably left open the Kennon finding and the reasons succinctly, but adequately, explained it. It must be remembered the husband did not challenge either the wife or the parties’ adult daughter about the truth and accuracy of their evidence of his violent and controlling conduct. Furthermore, during final submissions, the husband’s solicitor conceded that at least two instances of the husband’s past violent conduct were “very disturbing”, that those two incidents alone “certainly” increased the “arduous nature of the wife’s contributions”, and that the wife endured a “terrible time” during the marriage on account of his behaviour. The husband cannot make those concessions at trial and then seek to retract them in the appeal. Ground 6 fails.

51.      Any argument about the extent to which the wife’s contributions were then weighted in the process of determining her entitlement to divisible property transcends this ground of appeal and merges in Grounds 1, 2 and possibly 13.

Alleged discretionary error – financial contributions (Grounds 1 and 2)

52.      In combination, these two grounds contend the primary judge erred by failing to take into account, either at all or sufficiently, the husband’s initial financial contribution to the marriage (Ground 1) and his financial contributions during the marriage (Ground 2).

53.      The assertion that those features of the evidence were not taken into account at all is wrong.  Her Honour expressly did so (at [163]), in which event the husband is left with only an “insufficient weight” argument in each respect. It is unnecessary to recite, and enough to refer to, the authorities which establish the difficulty inherent in weight arguments (see Gronow v Gronow (1979) 144 CLR 513 at 519-520; Norbis v Norbis (1986) 161 CLR 513 at 539-540).

54.      The primary judge recorded that the husband introduced his unencumbered real property at Suburb O to the marriage in 1990. There was no admissible evidence as to its value at that point in time. The husband still owned the property at the time of trial and, about two years before, it was valued at $540,000. It therefore comprised about 41.5 per cent of the alienable assets at trial. It was common ground the wife took no assets of any material value into the marriage.

55. The primary judge concluded the parties’ respective contributions, as assessed under s 79(4) of the Act, resulted in the husband’s entitlement to 30 per cent of the assets. The gist of the husband’s complaint is that insufficient weight was attributed to his initial contribution of the Suburb O property when it constituted a larger proportion of the assets than did his ultimate percentage entitlement to the assets, once all of the parties’ other contributions over a long marriage were taken into account. The husband disavowed he was contending that his overall proportional entitlement to the divisible assets could not possibly be any less than the proportion of the assets represented by the Suburb O property, though that was the flavour of Ground 1 and the submissions made in support of it.

56. Contributions made by parties, as are recognised under s 79(4) of the Act, need not relate directly to the property they own at the time of trial. Property adjustment orders must be made with respect to the parties’ interests in the existing property so as to accommodate all of their contributions, whether made before, during, or after their relationship, and furthermore, the orders must be just and equitable by reference to such contributions (see Farmer and Bramley (2000) FLC 93-060 at [56] – [57], [65] – [66], [69]). Consequently, a large financial contribution by one party to existing property may be outflanked by contributions of a quite different type made by the other party, but all of their contributions need to be reflected in their eventual entitlements to the existing property.

57.      The reasons given by the primary judge for the assessment of the parties’ contributions were well exposed. Besides the parties’ unequal initial capital contributions (at [162] – [163]), they comprised:

(a)       Equal financial contributions, because the family received Centrelink payments and the husband did not derive any income through either employment or self-employment (at [36], [73], [166]);

(b)      The wife’s overwhelmingly greater non-financial contributions to the family, including to the eight children, throughout the marriage (at [165] – [168]); and

(c) The wife’s exclusive non-financial contributions to the children’s care and her principal financial support of them after the parties’ separation (at [173]).

58.      The primary judge did not expressly refer, at that point in the reasons, to the additional weight attributed to the wife’s contributions on account of the earlier Kennon finding (at [145]), but so much may be inferred.

59.      The synthesis of those factors produced an assessment of the parties’ respective contribution-based entitlements at 70 per cent to the wife and 30 per cent to the husband. In other words, the global assessment of their contributions over the preceding 28 years resulted in an assessment of the wife’s contributions at a little more than double the husband’s. In context, such an assessment was open and not foreclosed by the husband’s initial contribution of the Suburb O property, so Ground 1 must fail.

60.      As for Ground 2, the financial contributions the husband allegedly made during the marriage were not accepted by the primary judge. Her Honour found the family subsisted on welfare payments throughout the marriage and that, contrary to his assertion, the husband did not derive any income from paid work. Her Honour also rejected his contention that the family benefitted from gifts by members of the paternal family. The husband asserted it, but he adduced no other evidence, oral or documentary, to corroborate it. The primary judge, as was open, declined to accept his evidence unless it was corroborated. The primary judge preferred to accept the wife’s evidence that the family’s income comprised Centrelink welfare payments and rent receipts from the Suburb M property, owned by the second respondent, which property the husband treated as his own and to which both parties made contributions.

61.      The husband’s contention in the appeal that insufficient weight was accorded to those financial contributions, was misconceived because her Honour found, on the balance of probabilities, no such financial contributions were actually made. The husband did not contend those findings of fact were not open, in which event the primary judge did not err by paying no heed to his alleged but unproven contributions. Therefore, Ground 2 also fails.

Alleged discretionary error – assessments (Grounds 9 and 13)

62. By these grounds of appeal, the husband asserted the 30 per cent adjustment in the wife’s favour under s 75(2) of the Act was outside the range of any proper exercise of discretion (Ground 9) and, consequently, her overall entitlement to the whole of the divisible property was not just and equitable (Ground 13).

63. As for the contention that the quantum of the s 75(2) adjustment was “outside the range”, it is timely to observe there is no such recognisable category of appeal against discretionary judgments. It is only if, upon the facts, the orders are found to be “unreasonable or plainly unjust” that the appellate court may infer that, in some way, the primary judge failed to properly exercise the discretion (see House v The King (1936) 55 CLR 499 at 504-505). What, then, was unreasonable or plainly unjust about the orders which transferred to the wife the husband’s exclusive title in the three real properties?

64. The availability of the primary judge’s assessment, under s 79(4) of the Act, of the wife’s contribution-based entitlement to 70 per cent of the assets has already been explained under Grounds 1 and 2.

65. As for the 30 per cent adjustment in the wife’s favour under s 75(2) of the Act, the primary judge explained the reasons to be:

(a)       The wife’s continuing exclusive care for the parties’ three youngest children, all of whom were minors, the youngest of whom was only 10 years at the time of trial (at [175]);

(b)      The unlikelihood of the husband’s material financial contribution of child support during the remainder of their minority (at [176]);

(c)      The wife’s absence of any income-earning capacity at all (at [177]);

(d)      The husband’s “slim” prospects of future paid employment (at [178]);

(e)      The husband’s voluntary divestiture of his financial interest in his late mother’s estate (at [132], [179]);

(f)       The husband’s failure to account for about $116,000, being part of the net proceeds of sale he derived from the Suburb T land not long after the parties’ separation (at [104]-[125], [180]), together with the husband’s diversion of about $183,000 from family funds to the second respondent’s property over a period of about six years prior to the parties’ separation (at [181]), which thereby benefitted him alone;

(g)      The husband’s apparent ready access to assets ostensibly owned by the second respondent (at [147], [183], [186]); and

(h)      The apparent ability of the husband to accommodate himself in his late mother’s home (at [186]).

66. The real value of the s 75(2) adjustment is the important consideration, not its expression as a fraction or percentage of the overall assets (see Clauson and Clauson (1995) FLC 92-595 at 81,911). Given the parties conducted the trial on the basis that the husband’s three properties were collectively worth no less than $1.3 million, the 30 per cent adjustment in the wife’s favour computes to capital of not less than $390,000, which amount only barely offsets the funds from which the husband derived unilateral benefit ($116,000 plus $183,000), leaving aside other features of the parties’ respective future needs.

67. In the appeal, the husband conceded “the s 75(2) factors favour the wife”, which must mean he admits an adjustment in her favour was warranted, but he did not articulate why the adjustment found by the primary judge was not open, or how the adjustment should instead have been quantified. His failure or inability to do so was fatal to Ground 9.

68. Since the primary judge’s respective findings under ss 79(4) and 75(2) of the Act were both open, so must have been the mathematical computation of the wife’s overall entitlement to the whole of the divisible property. The husband’s simplistic refrain that it was “not just and equitable that the wife was awarded 100 [per cent] of the assets” was a bare assertion, which he did not make good, so Ground 13 also fails.

Conclusion and costs

69.      Having found no merit in any of the grounds of appeal, the appeal must be dismissed.

70.      In that event, the wife sought an order compelling the husband to pay her costs.

71.      The submissions for and against such an order were commendably short. The only basis upon which the husband resisted a costs order being made against him was his alleged impecuniosity. However, he was found to have exclusively benefitted from nearly $300,000, he failed to adduce updated evidence about his financial circumstances before the trial in breach of an order to do so, and the primary judge lacked confidence he had disclosed all of his assets, which considerations tend to weaken his claim. Nor can it escape attention that the husband incurred his own legal costs in the appeal approximating $20,000, with no attempt made to reconcile his capacity to incur and pay those fees with his claim of impecuniosity. In any event, while impecuniosity is a salient consideration, it alone does not necessarily bar a costs order.

72.      Significantly, the husband abandoned three grounds of appeal, either prior to or during the hearing of the appeal, and the remaining grounds were wholly unsuccessful. Those considerations in combination, outweigh his tight financial circumstances.

73.      We are persuaded to order the husband to pay the wife’s costs of and incidental to the appeal on a party/party basis. Given the quantum of his own costs, the husband acknowledged the wife’s asserted costs of $15,000 were quite reasonable, so we will quantify the order in that sum. He will have 28 days to pay.

I certify that the preceding seventy-three (73) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Strickland, Ryan & Austin JJ delivered on 29 April 2019.

Associate:

Date: 29 April 2019