ADCOCK & ADCOCK
[2013] FMCAfam 248
•22 March 2013
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| ADCOCK & ADCOCK | [2013] FMCAfam 248 |
| FAMILY LAW – Property proceeding for long marriage – import and effect of deed under Bankruptcy Act early in the marriage & s.86 deed – issues of valuation of cattle – Husband expert in cattle breeding – role and responsibilities of expert – large number of substantial gifts from Wife’s family during relationship. |
| Evidence Act 1995, s.79 Family Law Act 1975, ss.86, 75(2), 79(2) |
| Aleksovski v Aleksovski (1996) FLC ¶92-705 J.D. Heydon, Cross on Evidence (Ninth Australian Edition) (Sydney: LexisNexis Butterworths, 2013) |
| Applicant: | MS ADCOCK |
| Respondent: | MR ADCOCK |
| File Number: | AYC 118 of 2011 |
| Judgment of: | Neville FM |
| Hearing dates: | 2 & 3 July 2012 |
| Date of Last Submission: | 31 August 2012 |
| Delivered at: | Canberra |
| Delivered on: | 22 March 2013 |
REPRESENTATION
| Counsel for the Applicant: | Ms S Christie |
| Solicitors for the Applicant: | Farrell Lusher Solicitors, Wagga Wagga |
| Counsel for the Respondent: | Mr S Gardiner |
| Solicitors for the Respondent: | Walsh & Blair, Wagga Wagga |
ORDERS
Within 7 days the wife shall do all acts and things and execute all documents necessary to list the real property Lot [1] and Lot [2], more particularly known as [S] properties (hereinafter referred to as “the real property”) for sale by private treaty as set out in the following manner:
1.1.the wife will appoint a real estate agent within seven (7) days of the making of these orders;
1.2.the listing price for sale shall be as recommended by the agent;
1.3.if the property fails to sell on or before 1 October 2012, the wife shall do all necessary acts and things to list the property for sale by public auction in either October or November 2012, and the reserve price shall be as determined by the wife;
1.4.in the event the bidding at the auction does not reach the reserve price, the wife may negotiate with the highest bidders or any other interested person and effect a sale of the real property at a price which is not more than 5% below the reserve price;
1.5.if the property remains unsold, the wife will do all acts and things and sign all documents necessary to immediately relist the property for sale by public auction again on a date in February 2013, with the reserve price to be nominated by the wife;
1.6.the wife shall instruct a solicitor to have conduct of the sale;
1.7.in the event the bidding at the auction does not reach the reserve price at the second auction, the wife may negotiate with the highest bidders or any other interested person and effect a sale of the real property at a price which is not more than 5% below the reserve price.
On settlement of the sale of the real property the proceeds of sale be paid in the following manner and priority:
2.1.all costs and expenses of the sale including legal costs and disbursements, agents’ commissions, valuers’ fees and auction expenses;
2.2.the amounts required to pay all municipal and water rates outstanding with or with respect to the real property;
2.3.an amount required to repay to the wife invoices for any and all of the following expenses paid by the wife from the date of these orders until the settlement of the real property:
· Chemical spraying;
· lashing and burning and planting of seed;
· all purchases of super and assorted pasture seed;
· all diesel fuel;
· [H] Livestock Health & Pest Authority costs;
· [K] Land Care Group costs;
· all casual labour;
· council rates;
· water rates;
· costs of cleaning up flood/storm debris;
· cost of repairing damaged fences;
· cost of all materials for the erection of new fences;
· labour cost of installation of new fences.
2.4.any taxes associated with the sale of the real property including capital gains tax if applicable;
2.5.the balance then remaining to be divided:
a)28% to the husband;
b)72% to the wife.
The entire proceeds from the sale of the property “[W]” and from the sale of the water licence, currently held in the trust account of Farrell Lusher Solicitors including all interest earned thereon, be transferred to the wife within seven (7) days.
Except as any paragraphs comprised in these orders provide to the contrary, as against the husband, the wife is the sole legal and beneficial owner of and the husband has no interest in:
4.1.the furniture, furnishings and effects in the wife’s possession;
4.2.monies standing to the credit of the wife in any bank accounts in her name;
4.3.the Hyundai motor vehicle and Toyota Landcruiser motor vehicle in the wife’s possession;
4.4.the shares including the Co-Op shares in the wife’s name;
4.5.the stock currently in the wife’s possession;
4.6.all other assets of whatever nature and kind presently in the name, possession or ownership of the wife.
Except as to paragraphs comprised in these orders provide to the contrary, as against the wife, the husband is the sole legal and beneficial owner of and the wife has no interest in:
5.1.the husband’s furniture, furnishings and effects in his possession;
5.2.monies standing to the credit of the husband in any bank accounts in his name;
5.3.he Mercedes motor vehicle in his possession;
5.4.the semen in the husband’s possession and name;
5.5.the stock in the husband’s possession and/or control;
5.6.all other assets of whatsoever nature and kind presently in the name, possession or ownership of the husband.
Except as to any paragraph comprised in these orders provide to the contrary:
6.1.the husband hereby indemnifies the wife from and in respect of all actions, claims, suits and demands as may be made against the wife in relation to all liabilities in the name of the husband; and
6.2.the wife hereby indemnifies the husband from and in respect of all actions, claims, suits and demands as may be made against the husband in relation to all liabilities in the name of the wife.
Except as to any paragraph comprised in these orders provide to the contrary, each of the party releases the other from all debts owing from one to the other.
Both parties shall promptly do all acts and things and execute all documents, authorities and writings as are necessary to give effect to all or any of the provisions of the paragraphs comprised in these orders.
In the event that either party refuses or neglects to execute any deed or instrument necessary to give effect to these orders, then the Registrar of the Family Court of Australia at Canberra is hereby appointed pursuant to 106A of the Family Law Act 1975 to execute such deed or instrument in the name of the defaulting party and to do all acts and things necessary to give validity and operation to the deed or instrument.
10. The Respondent pay the Applicant the sum of $5,000 in relation to the preparation of written submissions.
11. In the absence of any submission in writing within 7 days each party shall bear their own costs.
IT IS NOTED that publication of this judgment under the pseudonym Adcock & Adcock is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT CANBERRA |
AYC 118 of 2011
| MS ADCOCK |
Applicant
And
| MR ADCOCK |
Respondent
REASONS FOR JUDGMENT
Introduction & Background
These are property proceedings in relation to a relationship of approximately twenty-two (22) years.
The Applicant Wife is aged 67, and the Respondent Husband is aged 72. The Wife is employed full-time as [omitted. The Husband is a self employed cattle farmer. Both parties have had long involvement in cattle-breeding, Simmental cattle in particular.[1]
[1] In her non-contradicted affidavit evidence (trial affidavit, filed 12th June 2012), at paras.10 & 11, Mrs Adcock confirmed that she and Mr Adcock were both members of the Australian Simmental Breeders Association. Indeed, she had been [omitted] of the Victorian branch of that Association.
The parties commenced cohabitation in June 1988 and were married [in] 1989. They separated in early 2010; the Husband says that the parties separated under the same roof in January 2010, with the Wife leaving the matrimonial home in March 2010. The Wife says that the parties separated on a final basis on 5th March 2010. The parties were divorced on 28th July 2011. There are no children of the relationship.
For my part, little turns on the small difference between the evidence of the parties regarding the date of separation. Of greater moment, however, in the light of the evidence, wherever there is any disparity in the account of any particular event, unless otherwise specified, I should be taken to prefer the evidence of the Wife to that of the Husband. In almost all respects, her evidence was both more precise and focussed, whereas Mr Adcock’s evidence tended to be a discursive narrative that did not pay particular regard to the question he was being asked. As well, his evidence tended to be more an ex post facto justification for things done, or not done, during the course of the marriage. And further, the evidence of the Wife tended, in almost all cases, to be supported by documentary, or other more reliable, evidence.
Mr Adcock proffered significantly scant documentary evidence in support of his contention.
For example, Mrs Adcock’s trial affidavit, filed 12th June 2012, is 18 pages but with annexures that bring the affidavit to a sizeable 181 pages. The annexures are copies of documents obviously to support her application. By contrast, Mr Adcock’s trial affidavit, filed 20th June 2012, was a mere 12 pages, with a single page annexure. Respectfully, for a marriage of more than 20 years the affidavit and documentary evidence of Mr Adcock was very poor and significantly lacking.
The key areas of dispute in the matter are: the effect of a deed entered into by the parties pursuant to s.86 of the Family Law Act 1975 (“the Act”) and any matters (for example) by way of initial contribution that flow from that deed; the proper value of (and relevant date relating to) the parties’ cattle; various ‘add-backs’ claimed by the Wife as against her former Husband (e.g. in relation to funds said to have been taken from joint funds by the Husband, and the value of certain oats and silage left on the farming property known as “[W]” upon its sale).
Subject to the matters just mentioned (and a few others noted shortly) the assets and liabilities pertaining to the relationship have been agreed, in large measure. The only items that remain contentious are (as just indicated) the value of the cattle, whether funds utilised by the Husband from the parties’ joint farm account should be added back into the property pool, and whether the Wife should be credited for monies utilised for farm purposes since separation.
A significant part of the case concerned the various contributions made by the parties during the relationship. Of particular significance is the fact that the Wife received a number of gifts and inheritances over the course of the twenty-two year marriage that totalled $1,319,428. The Wife argued that these significant contributions set this matter apart from the usual jurisprudence in “long marriage cases”.
The Husband argued that although the Wife made significant financial contributions over the course of the relationship, he had done the majority of the work on the parties’ property, which enabled the Wife to maintain full time employment ‘off the farm’. The Husband argued that the hard work (“hard work” was emphasised regularly, as if to suggest that some special consideration should be given to such earnest labour, a proposition which, in my view, is unsupported) that goes with any family generally was essentially shared equally by the parties, with both parties contributing physically, emotionally and financially to the union and key decisions made together. To quite some degree, the Wife disputed the Husband’s assessment in this regard. Moreover, the Husband’s contentions, in my view, seemed often to gloss over, or otherwise pay insufficient regard to, the fact that in addition to the Wife’s very substantial financial contributions throughout the relationship (itemised below) she worked ‘off the farm’ and her wages/salary was also contributed to the parties’ welfare.
The points of contention in regard to s.75(2) factors include: the current financial circumstances of the [older] Husband, as he has re-partnered, and the relative income and earning capacities of the parties. To complicate this aspect slightly, until the Court raised the lack of disclosure of relevant information from the Husband’s new partner, there was precious little information on that matter. As I commented at the time, this was a very significant omission in the evidence by the Husband and a signal failure properly to disclose relevant evidence.
In a somewhat similar vein, I should also highlight the significant failure to comply with the Court’s trial directions. Among many consequences of this is that it only makes the Court’s ability to deal efficiently with its very large case-load so much more difficult.
In this case, trial directions were made on 29th November 2011, which provided for the filing of material by 11th June 2012, and for a case outline to be filed and served by 25th June 2012. By way of example only, even by the first morning of the trial (on 2nd July 2012) the Court still did not have even a minute of orders sought by the Husband, let alone a case outline.[2] The Wife had filed her material essentially in accordance with the trial directions. Even allowing for the Husband having changed solicitors, albeit many months before the trial, the lack of basic material as ordered by the Court (a) was a signal failure to abide by orders of the Court, and (b) hampered the efficient conduct of the proceedings.
[2] Indeed, even by late on the second day of the trial no minute of orders on behalf of Mr Adcock had been provided to the Court. See T (3rd July 2013) p.141.
The comments of Finkelstein J in Black & Decker (Australasia) Pty Ltd v GMCA Pty Ltd are apt.[3] Beginning at [1], his Honour said: “It is common for parties to do little more than pay lip service to timetable fixed to regulate when steps should be taken to get a case on for trial.” Alas, his Honour’s comments describe an all too common approach in matters before this Court. Then at [4], his Honour said: “If, in some instances, the preparation of the case is not perfect so be it. A case that is reasonably well prepared is just as likely to be decided correctly as a perfectly prepared case.” This is clearly not an invitation for cases to be ill, or poorly prepared.
[3] Black & Decker (Australasia) Pty Ltd v GMCA Pty Ltd [2007] FCA 1623.
No less strong, and in many ways much stronger, comments were made by the High Court in relation to the efficient conduct of litigation in the well-known case of AON Risk Services Australia Ltd v Australian National University.[4] The Court there discussed at great and poignant length the importance of the efficient conduct of litigation and the timely adherence to processes, particularly having regard to courts being public resources and the constant demands on those limited resources.
[4] AON Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175.
Giving every allowance for various matters on the Husband’s side, his misperception of what did and what did not constitute relevant information (even to the point of his solicitor and Counsel only learning of certain matters just before or on the morning of the trial) posed significant and obvious difficulties for all concerned. One might be tempted even to take such conduct into account, either in relation to costs or otherwise – on which more later.
The Wife seeks a distribution in percentage terms of 80%, based on the gifts and inheritances she received, her financial contributions during the relationship and her post separation contributions. The Wife submitted that her contributions by way of gift and inheritance are equal to the entire pool available for division, and thus a division in her favour should reflect those significant contributions.
The Husband conceded that the Wife’s financial contributions were more than his during the relationship, and that the Wife should receive a division of the property pool in her favour. The Husband submitted that both parties worked very hard together during the marriage and that a distribution to the Wife should be 55% of the available property pool.
For the reasons that follow, in my view, the Husband’s percentage assessment of what is or should be the just and equitable order in this matter is significantly awry. The Wife’s orders sought are much closer to the mark – but not quite – again, for the reasons now detailed.
Orders sought
In precise detail, the parties’ respective ‘orders sought’ are as follows.
Orders sought by the Wife
1.That within seven (7) days of the date of these Orders the wife shall do all acts and things and execute all documents necessary to list the real property Lot [1] and Lot [2], more particularly known as [S] properties (hereinafter referred to as “the real property”) for sale by private treaty as set out in the following manner:
1.1The wife will appoint a real estate agent within seven (7) days of the making of these orders;
1.2the listing price for sale shall be as recommended by the agent;
1.3if the property fails to sell on or before 1 October 2012, the wife shall do all necessary acts and things to list the property for sale by public auction in either October or November 2012, and the reserve price shall be as determined by the wife;
1.4in the event the bidding at the auction does not reach the reserve price, the wife may negotiate with the highest bidders or any other interested person and effect a sale of the real property at a price which is not more than 5% below the reserve price;
1.5if the property remains unsold, the wife will do all acts and things and sign all documents necessary to immediately relist the property for sale by public auction again on a date in February 2013, with the reserve price to be nominated by the wife;
1.6the wife shall instruct a solicitor to have conduct of the sale;
1.7in the event the bidding at the auction does not reach the reserve price at the second auction, the wife may negotiate with the highest bidders or any other interested person and effect a sale of the real property at a price which is not more than 5% below the reserve price.
2.On settlement of the sale of the real property the proceeds of sale be paid in the following manner and priority:-
2.1all costs and expenses of the sale including legal costs and disbursements, agents’ commissions, valuers’ fees and auction expenses;
2.2the amounts required to pay all municipal and water rates outstanding with or with respect to the real property;
2.3an amount required to repay to the wife invoices for any and all of the following expenses paid by the wife from the date of these orders until the settlement of the real property:
·Chemical spraying;
·slashing and burning and planting of seed;
·all purchases of super and assorted pasture seed;
·all diesel fuel;
·[H] Livestock Health & Pest Authority costs;
·[K] Land Care Group costs;
·all casual labour;
·council rates;
·water rates;
·costs of cleaning up flood/storm debris;
·cost of repairing damaged fences;
·cost of all materials for the erection of new fences;
·labour cost of installation of new fences;
2.4any taxes associated with the sale of the real property including capital gains tax if applicable;
2.5the balance then remaining to be divided:-
2.5.120% to the husband;
2.5.280% to the wife.
3.That the entire proceeds from the sale of the property “[W]” and from the sale of the water licence, currently held in the trust account of Farrell Lusher Solicitors including all interest earned thereon, be transferred to the wife within seven (7) days.
4.Except as any paragraphs comprised in these orders provide to the contrary, as against the husband, the wife is the sole legal and beneficial owner of and the husband has no interest in:
4.1the furniture, furnishings and effects in the wife’s possession;
4.1monies standing to the credit of the wife in any bank accounts in her name;
4.3the Hyundai motor vehicle and Toyota Landcruiser motor vehicle in the wife’s possession;
4.4the shares including the Co-Op shares in the wife’s name;
4.5the stock currently in the wife’s possession;
4.6all other assets of whatever nature and kind presently in the name, possession or ownership of the wife.
5.Except as to paragraphs comprised in these orders provide to the contrary, as against the wife, the husband is the sole legal and beneficial owner of and the wife has no interest in:
5.1the husband’s furniture, furnishings and effects in his possession;
5.2monies standing to the credit of the husband in any bank accounts in his name;
5.3the Mercedes motor vehicle in his possession;
5.4the semen in the husband’s possession and name;
5.5the stock in the husband’s possession and/or control;
5.6all other assets of whatsoever nature and kind presently in the name, possession or ownership of the husband.
6.Except as to any paragraph comprised in these orders provide to the contrary:
6.1the husband hereby indemnifies the wife from and in respect of all actions, claims, suits and demands as may be made against the wife in relation to all liabilities in the name of the husband; and
6.2the wife hereby indemnifies the husband from and in respect of all actions, claims, suits and demands as may be made against the husband in relation to all liabilities in the name of the wife.
7.Except as to any paragraph comprised in these orders provide to the contrary, each of the party releases the other from all debts owing from one to the other.
8.Both parties shall promptly do all acts and things and execute all documents, authorities and writings as are necessary to give effect to all or any of the provisions of the paragraphs comprised in these orders.
9.In the event that either party refuses or neglects to execute any deed or instrument necessary to give effect to these orders, then the Registrar of the Family Court of Australia at Canberra is hereby appointed pursuant to 106A of the Family Law Act 1975 to execute such deed or instrument in the name of the defaulting party and to do all acts and things necessary to give validity and operation to the deed or instrument.
10.That the husband pay the wife’s costs of and incidental to these proceedings.
Orders sought by the Husband
1.Agree with Wife’s proposed Order 1, save for adding the water licence and plant and equipment in the wife’s possession.
2.Agree with Wife’s proposed Order 2.1 and 2.2
2.1the balance of the settlement funds to be divided 45% to the husband and 55% to the wife.
2A.on settlement of the sale of the water licence and plant and equipment, the proceeds are to be divided 45% to the husband and 55% to the wife.
3The proceeds of the sale of ‘[W]’ and the water licence currently held in controlled monies be divided $445,731 as to the husband and the balance to the wife.
4Agree with proposed Order 4 save for 4.4
4.4The parties do all such acts and sign all necessary documents to effect an equal division of the Co-op shares currently held in joint names.
5Agree with Orders 5 to 9.
Evidence of the Parties
The Evidence of Mrs Adcock
In what follows, I deal firstly with Mrs Adcock’s oral evidence at trial; secondly, I deal with those areas from her affidavit material that are necessary to expand upon the factual background relevant to the current proceeding and which were not the subject of challenge.
At the outset of her evidence Mrs Adcock was challenged about her knowledge of the financial position of Mr Adcock at the commencement of their relationship. She said that she was not fully aware of his financial difficulties.[5] Rather, according to her evidence, she did some of the farm bookwork for Mr Adcock, such as depositing cheques, but she did not write cheques.
[5] See the discussion beginning at Transcript (2nd July 2012) p.27 ff. The deposit book about which Mrs Adcock was asked questions (a) related to a period beginning in September 1989, and (b) it only came to light on the first morning of the trial, thus neither Mrs Adcock nor her Counsel had seen the document(s) beforehand.
Mrs Adcock confirmed that in the early stages of the relationship she did not discuss the detail of the farming business or that part of his business that concerned “bagged feed” for various animals. She had some knowledge, but some knowledge only, of her Husband’s financial situation.
Mrs Adcock received approximately $90,000 from the property settlement with her first Husband. This sum was used in the later purchase of the [W] property near Wagga Wagga. Part of the purchase price for this property also came from the sale of plant and equipment from Mr Adcock’s business that had formerly been run in the [H] region of NSW. Mrs Adcock was the person responsible for arranging the finance for the purchase of [W].[6]
[6] T (2nd July 2012) p.37. Hereafter, and unless otherwise required, transcript references will simply be “T” (for this date) followed by the page number.
Mrs Adcock contended that, because of the operation of the s.86 agreement/deed (noted further below) which placed the remaining assets of Mr Adcock in her name, the proceeds of sale of plant and equipment were legally hers. It followed from this contention, articulated in submissions, that any assets of Mr Adcock that were transferred to Mrs Adcock pursuant to the terms of the s.86 deed were contributions by Mrs Adcock. This submission is dealt with later. It is sufficient to note here that, whatever the position at law, [justice and] equity could not and cannot accept such a submission in toto. Among other things, Mrs Adcock would not have had the proceeds of sale of plant and equipment had Mr Adcock not owned and transferred it to her. This is also to say that she was clearly the legal beneficiary of the assets transferred under the deed; however, she did not bring those assets, from which and for which she now claims a significant benefit, into existence or into the relationship. All of this said, Mrs Adcock confirmed later in her oral evidence that she regarded the proceeds of sale of plant and equipment as funds that were properly regarded as belonging to both of the parties.[7]
[7] T 37.
Mrs Adcock confirmed also that at the commencement of the relationship with Mr Adcock she had no assets of any real significance, other than her interest in the farm, stud and cattle business that she owned with her former Husband.[8]
[8] T 36.
Mrs Adcock stated that (a) the various properties, and notably [W], purchased by the parties were inspected by them both and that it was a joint decision to purchase them, and (b) Mr Adcock worked and improved the properties, such as providing fencing, dealing with gully erosion, tree planting, and such matters. She also confirmed that some work was done by contractors.[9]
[9] See, for example, the discussion at T 31 ff.
Mrs Adcock confirmed, and with some force and detail, that she worked in the stockyards.[10] In his evidence, and as he did in relation to a not insignificant number of matters, Mr Adcock sought to diminish Mrs Adcock’s labours on the farm. As I have previously confirmed, I prefer and accept Mrs Adcock’s evidence where there is any conflict with that of Mr Adcock.
[10] T 38.
In summary (as given in the course of cross-examination), Mrs Adcock was (a) working full-time, (b) she did the majority of the housework, (c) did animal husbandry on the farm as required (particularly when
Mr Adcock was away – which she said was quite often and for periods of time), and (d) looked after the bookwork of the farm. The only matter of bookwork she did not look after was the herd inventory.[11]
[11] T 38 – 39.
She confirmed that Mr Adcock had sole responsibility for the purchase and sale of stock. She also confirmed that she used all the proceeds of the gifts and bequests she received for the mutual benefit of the parties.[12]
[12] T 39. The detail of the gifts and bequests is set out later in these reasons.
The purchase of another property – [O] – was also a joint decision of the parties, and that, although the property was again purchased in the sole name of Mrs Adcock, she agreed that it was another ‘joint venture’ by the parties.[13] Such improvements that were made to that property (e.g. clearing the land for cattle grazing) were made by Mr Adcock with the assistance of another workman (Mr C).
[13] T 40. In general terms, the property Kiloran was purchased for $205,000 and sold some years later for $393,000.
As with earlier evidence, Ms Adcock confirmed that the purchase of the further properties ([1] & [S]) was a joint decision between the parties. The ‘[S]’ properties are also known or referred to as “the [S]” property. Mr Adcock constructed a new boundary fence on that property, as well as a new hayshed – with the assistance of contractors. Mrs Adcock agreed or readily acknowledged other work of Mr Adcock, such as his negotiations with the Roads & Traffic Authority regarding the construction of a road in relation to the [S] property.[14]
[14] T 44.
Mrs Adcock confirmed too that whenever Mr Adcock was away, mainly [omitted], which occurred quite frequently, she would be responsible for providing feed for stock and or any other matters that required attention.
The expenses of [W] were acknowledged to have been consistently used by Mrs Adcock as a tax deduction in relation to her ‘off-farm’ income.[15] There was also some income from the sale of stock. Further, from the proceeds of sale of stock ($33,000) Mrs Adcock spent $18,737 on expenses in relation to [W], in relation to the period 29th March and 27th June 2012.[16] She further confirmed that these expenses will more than likely be claimed as tax deductions.[17] As well, some of the expenses were incurred, she said, to prepare the property for sale.
[15] T 49.
[16] See further detail on such matters at p.163 of Mrs Adcock’s trial affidavit.
[17] T 51. There seems no dispute that (a) the farm was run at a loss, and (b) on Mrs Adcock’s evidence, her tax refunds each year were put back into the operation of the farm. See T 54.
Upon the ultimate sale of [W], according to Mrs Adcock, a portion of grain and oats that had been left on the property went with the sale of the property. Mrs Adcock did not consult Mr Adcock in relation to the destination and use of this grain and oats. The contest here was that
Mr Adcock considered the value of the grain and oats to be in the order of $30-40,000, while Mrs Adcock said it was more in the range of $12,000 or thereabouts. She said that her figure in fact came from Mr Adcock.[18]
[18] T 55.
In a similar vein, Mrs Adcock confirmed that, contrary to Mr Adcock’s assertion that there was a sizeable amount of silage left on [W] at the time of its sale, there was, in fact, little silage. Rather, much silage was lost during a flood, and what was left was used as feed for stock.[19]
Mrs Adcock noted, and not for the first time, that the events surrounding the property from approximately April 2011 took place where Mr Adcock was no longer in residence, including when the sale was completed in August 2011.
[19] T 56.
Finally, in relation to Mrs Adcock’s claim for a sum of approximately $52,000 used by Mr Adcock (drawn on the Westpac farm account between March 2010 and April 2011) being added back to the pool, and in response to the submission/question from learned Counsel for Mr Adcock that his client used those funds either or both to live on and or to operate the farm, Mrs Adcock said that she could check on what those sums were spent on up to 30th June 2010, but that after that date she had not been provided with the relevant cheque books by
Mr Adcock, and therefore could not know or be satisfied as to the expenditure.[20]
[20] T 57.
In relation to her unchallenged affidavit evidence, I note the following in so far as it relates directly to a matter that assists the Court, as opposed to general historical or other detail.[21]
[21] Relevant references are to Mrs Adcock’s trial affidavit, filed 12th June 2012.
A copy of the s.86 deed entered into by the parties on 21st June 1991 is annexure FEA5. Part of that annexure is correspondence from the solicitor instructed in the preparation of that deed. Following a brief outline of her concerns about Mr Adcock’s financial difficulties at the time, Mrs Adcock confirmed that the deed was entered into “to avoid [Mr Adcock’s] creditors and the trustee in bankruptcy.”
Curiously, and surprisingly, Mr Adcock makes no mention of the s.86 deed in his affidavit evidence. He confirmed (at paras.13 & 14 of his trial affidavit) that a combination of factors (high interest rates and floods) “caused severe financial difficulty for [his] farming business.” He also said that “in or about 1990 [he] received legal advice to assist me to organise [his] financial affairs. [He] did this in conjunction with negotiations with [his] then bank, the State Bank of NSW. The result was that the farming properties were sold; the bank was paid out; the stock and the plant and equipment were transferred into Mrs Adcock’s [Mrs Adcock’s] name and we moved to Wagga Wagga. The fodder produce store was closed. In 1993 I declared myself bankrupt.”[22]
[22] As further evidence of the financial and legal difficulties faced by the parties early in their relationship, Mrs Adcock annexed a copy of one statement of claim, filed by the National Australia Bank, against Mr Adcock in December 1991. See FEA10. She said that it was typical of similar claims made against Mr Adcock at the time.
There was some contest as to whether the [H] property of Mr Adcock’s was sold as a mortgagee sale. Mrs Adcock says that it was (and she annexed a copy of the advertisement for the auction – FEA 7). In her oral evidence she confirmed that it was not formally advertised as a mortgagee sale, but that this was by arrangement with the Bank. Certainly, according to the letters that constitute annexure FEA8, the Bank was very actively involved and required that Mr Adcock not keep any of the proceeds of sale. Respectfully, Mr Adcock’s more generalised account, set out in the previous paragraph, lacks the precision and detail provided by the annexures to Mrs Adcock’s affidavit. Indeed, contrary to Mr Adcock’s assertion that ‘the Bank was paid out’, Mrs Adcock confirmed that there was a shortfall to the Bank of approximately $400,000. Thus, there was a sizeable gulf in the evidence of the parties on this matter. The evidence clearly supports Mrs Adcock’s account; the letter from Mr Adcock’s then solicitors, dated 10th June 1992 (at annexure FEA8) confirms that the Bank had yet to form a view whether to take further action against Mr Adcock to recover the $400,000 shortfall. What happened in relation to this very sizeable shortfall was not explained. Although it was not so argued, it could be taken to be a debt that fell onto the parties early in the marriage but which perhaps should have fallen specifically at the feet of Mr Adcock. I make no other comment on it, other than to emphasise (as I do later in these reasons) that Mr Adcock’s lack of detail in his evidence was again on display.
The clearing sale of plant and equipment netted just over $105,000. Mr Adcock’s original evidence said that the sale realised approximately $130,000. At trial, and in the light of the documentary evidence of Mrs Adcock (see annexure FEA9), Mr Adcock accepted the figure of $105,000 as accurate.
The purchase of the 720 acre property known as [W], for $450,000 in April 1992, was financed as follows (according to Mrs Adcock): $90,000 from Mrs Adcock being the proceeds of her earlier family law property matter; $105,000 from the proceeds of the clearing sale of plant and equipment from Mr Adcock’s former property; an unspecified amount being a remainder of funds previously gifted to Mrs Adcock by her Mother, which totalled $70,000. Mrs Adcock’s evidence was that of the $450,000 purchase, from her own funds she paid $250,000, and the balance came via vendor finance.
Mr Adcock’s account of this purchase is somewhat different. He says (trial affidavit, para19) that [W] was purchased using the net proceeds of sale of another property ([T]), being $20,000, and “putting capital in of $250,000, which had come from me, being cash, monies obtained from the sale of my plant and equipment, profit from [T] and vendor finance from Mr & Ms P of $200,000. I have no recollection of
Mrs Adcock using the moneys she received in her property settlement in 1991 being put towards this purchase….” As is clear, Mr Adcock does not refer to the funds received by Mrs Adcock from her Mother. That said, apart from various and rather disparate comments by
Mr Adcock at paras.39-49 of his trial affidavit, I do not understand that there is any challenge to the significant gifts and inheritances received by Mrs Adcock during the course of the relationship. As with other matters, in relation to the purchase of [W], I prefer and accept the more detailed account of Mrs Adcock.
In paras.29 and following, Mrs Adcock refers to and supports by copies of annexed documents the history of (a) the many gifts and the inheritances she received during the course of the relationship with
Mr Adcock, and (b) the various ways in, and farm-related matters on, which such funds (as well as her annual income from her employment) were employed. Because of the documentary evidence annexed to her affidavit that supports her account, I accept Mrs Adcock’s evidence in relation to each of the matters there detailed.
In October/November 2000, the parties purchased (again in
Mrs Adcock’s sole name) another property, known as [O], for $195,000. A further, adjacent block was also purchased for $10,000. These purchases, and she swears also to pay for further farm expenses, were funded by Mrs Adcock’s sale of shares to the value of $152,751. She also took out a loan with [B] Limited for the sum of $147,404.
Mr Adcock’s account of the purchase of [O] (at para.32 of his trial affidavit) is also rather different to the account given, and documented, by Mrs Adcock. Putting to one side the lack of documentary or any other evidence to support Mr Adcock’s version of the purchase, perhaps the most striking difference in the respective accounts is that Mr Adcock avers that the purchase was partly funded by a mortgage over [W] (about which Mrs Adcock makes no comment). Further,
Mr Adcock makes no mention of any of the sale of shares, or the loan raised with [B] Ltd (“[B]”). For the same reasons of supporting documentary evidence I accept the account of events from
Mrs Adcock, and correspondingly reject the very brief and unsupported narrative given by Mr Adcock.
In paras.36-39, Mrs Adcock deposed to, and documented, her share trading (between April 1999 and October 2000) to fund farming and related expenses during the relationship which totalled $393,067. She deposed also to a further loan from [B] to pay out an earlier loan and to pay for moneys owed under a stock trading account (in the sum of $100,000) with Elders. A copy of the Elders Statement for 28th February 2002 is part of annexure FEA21.
In the same paragraphs, Mrs Adcock accounts for further gifts and inheritances, this time from her step-Father. This included the remaining half-share in a property in [C], Victoria, which property was later sold, in early 2004, the net proceeds of which totalled $732,652 (see annexure FEA26).
In May 2003, Mrs Adcock purchased Lots [1] and [S], Wagga Wagga for $355,000. This purchase was funded by further borrowings from [B]. In July of that same year, [O] was sold for $387,500. From these proceeds of sale, $230,000 was paid off the loan from [B].
Mrs Adcock had one son from her earlier marriage. She purchased an investment property in Queensland for him in the sum of $305,000. This was funded by Mrs Adcock providing funds of $141,582.02 from the sale of the [C] property, with the rest coming via a mortgage from a bank. The son made the mortgage repayments.
Also from the proceeds of sale from the [C] property, Mrs Adcock paid off one of the [B] loans ($232,546.80); part of another loan with [B] ($70,492.92); and she invested $100,000 until the balance of the loan(s) to [B] fell due in December 2005. Again, copies of relevant documents are annexed to support all the matters to which she refers.
The loan with [B] was paid out in December 2005. Relevant bank statements are also annexed to her affidavit (FEA31).
In 2007, Mrs Adcock confirmed that things became “financially tight” on the farm due to the drought, which resulted in her taking out a [further] loan with [B] in the sum of $150,000. These funds were used to buy water licences.
Sadly, Mrs Adcock’s son was killed in a road accident in 2008. The Queensland property was later sold and Mrs Adcock received $192,370.29 (net). From these proceeds, the [B] loan was paid out, and Mrs Adcock retained the balance of approximately $40,000. She confirmed (para.50) that, at that time “we became totally debt free.”
In 2009, Mrs Adcock deposed that the parties took out an overdraft of $50,000 with the ANZ Bank for various [specified] farming costs.
I confirm [again] that in relation to all of these matters to which
Mrs Adcock deposed, I accept her account of them wherever there is any difference between her evidence and that of Mr Adcock.
In relation to post-separation matters, Mrs Adcock deposed as follows.
Post separation, and with her no longer living on the farm (but renting elsewhere), Mrs Adcock continued to look after the books of the farm. Mr Adcock’s then solicitors required that Mrs Adcock no longer attend the farm. She deposed to receiving notification from the bank (ANZ) regarding the overdraft account being overdrawn.
Following mediation in January 2011, there was some agreement in relation to the sale of some cattle, and in February of that year,
Mrs Adcock moved back to [W].
Through correspondence between solicitors, Mrs Adcock advised that Mr Adcock could continue to conduct the farming operations. However, Mrs Adcock deposed that Mr Adcock attended the farm infrequently until he stopped attending at all. Accordingly, she says, with the assistance of employed casual farm labour, she took over the operation of the farming enterprise (para.64).
Mr Adcock had always had access to the “farm account.” After separation, and following correspondence again through solicitors,
Mrs Adcock gained access to bank statements of Mr Adcock’s personal St George account. It appeared to her that he was continuing to access the farm account to transfer funds to his personal account. She deposed to sums, such as $3600 at a jeweller on 24th December 2010, and a further sum of $5650 in May 2010. In her view, Mrs Adcock was funding Mr Adcock’s “lifestyle with his new partner.” In April 2011, Mrs Adcock changed the PIN number on the farm account to prevent Mr Adcock accessing it.
At para.66 of her affidavit, Mrs Adcock deposed to further funds being used by Mr Adcock from the overdraft account, including writing himself a cheque in the sum of $3000. In the following paragraphs of her affidavit, Mrs Adcock deposed to various expenditures on [W] “to prepare the property for sale.” The detail of same, totalling $40,000, is set out in annexure FEA43.
According to Mrs Adcock, Mr Adcock continued to take funds from the farm account, which totalled $52,900. She also continued to expend funds on the farm, which matters are documented at FEA45.
[W] was ultimately sold, with settlement taking place in August 2011. The net proceeds of sale were $970,716.90. Various accounts were then paid (details given), and it was agreed that both parties would each receive $20,000 from the proceeds of sale to cover legal costs, with the balance to be kept and invested in a controlled monies account.
Various other expenses are detailed in Mrs Adcock’s affidavit (see pp.15-16), as well as a summary of current assets and liabilities, funds which she says should be added back (being the funds provided to both parties in relation to legal fees, and the funds accessed by Mr Adcock from the overdraft account in 2010 and 2011, which total $52,900).
Finally, in her affidavit, Mrs Adcock deposed to seeking a property settlement whereby she received 80% and Mr Adcock 20% of the net proceeds of sale from the [S] properties, and that she receive 78% and Mr Adcock 22% of the remaining net asset pool.
For ease of reference, I set out the two tables from Counsel’s submissions that detail the amounts Mrs Adcock received during the relationship from gifts and inheritances. As is readily seen “gifts” totalled $252,300; “inheritances” totalled $1,319,428.
GIFTS
| Date | Paragraph | Amount | From Whom |
| 28 November 1988 | 16(a) | $60,000 | Wife’s mother |
| Cohabitation | 16(b) | $14,800 (car) | Wife’s mother |
| 7 February 1991 | 17 | $20,000 | Wife’s stepfather |
| 15 April 1993 | 29(a) | $15,000 | Wife’s mother/stepfather |
| 8 April 1993 | 29(b) | $25,000 | Wife’s mother/stepfather |
| 7 April 1994 | 29(c) & (d) | $12,000 | Wife’s mother/stepfather |
| 2 October 1994 | 29(e) | $2,000 | Wife’s mother/stepfather |
| 5 January 1995 | 29(f) | $7,500 | Wife’s mother/stepfather |
| 9 January 1995 | 29(g) | $7,500 | Wife’s mother/stepfather |
| 18 October 1995 | 29(h) | $4,000 | Wife’s mother/stepfather |
| 17 April 1996 | 29(i) | $1,000 | Wife’s mother/stepfather |
| 18 July 1996 | 29(j) | $1,000 | Wife’s mother/stepfather |
| 19 July 1996 | 29(k) | $1,000 | Wife’s mother/stepfather |
| 7 January 1997 | 29(l) | $20,000 | Wife’s mother/stepfather |
| 7 January 1997 | 29(m) | $40,000 | Wife’s mother/stepfather |
| 7 November 1997 | 29(n) | $2,000 | Wife’s mother/stepfather |
| 9 February 1998 | 29(o) | $3,500 | Wife’s mother/stepfather |
| 26 June 1998 | 29(p) | $1,000 | Wife’s mother/stepfather |
| 3 May 2002 | 38 | $15,000 | Wife’s stepfather |
| Total | $252,300 |
INHERITANCES
| Date | Paragraph | Amount | From Whom |
| 17 Dec 1998 & 2 Feb 1999, 29 Feb 2000 | 31(a) annexes 74, 78 | $57,669 | Wife’s mother |
| 20 July 1998 | 31(b) | $485,932 | Wife’s mother |
| 29 Mar 2004 | 39 annex 74 | $43,175 | Wife’s stepfather |
| 7 July 2002 (sold 2004) | 39/42 | $732,652 | Wife’s stepfather/wife’s mother |
| Total | $1,319,428 |
Respectfully, in the light of all the evidence, Mr Adcock’s “acknowledgment” of Mrs Adcock’s “inheritance” and its assistance or relevance in assessing “contributions” of the parties, is in my view quite niggardly, and in the light of the documentary evidence provided by Mrs Adcock, borders on, at least, the disingenuous. At para.28 of his trial affidavit, he said (emphasis added): “I acknowledge that
Mrs Adcock’s inheritance was used to assist with the feeding and running costs [of [W]].” In my view, Mrs Adcock’s funds clearly provided very much more than [mere] ‘assistance.’
The Evidence of Mr Adcock
The first matter to address in relation to Mr Adcock’s evidence is that, at paras.56-63, he comments at a little length on the Simmental cattle of the parties in the light of the expert report of Mr D. That report, which followed agreed orders (dated 16th June 2011) appointing Mr D as the single expert, is attached to an affidavit sworn by him on 15th June and filed on 20th June 2011.
Accepting that Mr Adcock has worked with cattle, and this particular breed, for some 40 years, and given the legal prescriptions in relation to expert witnesses, most recently set out by the High Court in Dasreef Pty Ltd v Hawchar, there are a number of difficulties with this evidence.[23]
[23] Dasreef Pty Ltd v Hawchar (2011) 243 CLR 588.
First, he cannot be an expert witness in his own case. The degree of objectivity required of an expert would patently be lacking here.
Secondly, with a single expert having been appointed, and with the parties’ lawyers having provided Mr D with a joint letter of instruction, dated 5th July 2011, it is very late in the day – literally less than two weeks before the trial – (a) to seek to challenge Mr D’s valuation, and (b) to seek to put further evidence before the Court in relation to the value of the cattle the subject of the expert’s report. Moreover, as his learned Counsel said at the trial, Mr Adcock’s estimates in relation to value were based on “his recollection of what stock was on the property at that time.”[24] In the result, however, I allowed Mr D to be asked questions in the light of Mr Adcock’s evidence.[25] I return to the valuation of the cattle and Mr D’s report and evidence later.
[24] See Transcript (3rd July 2012) p.62. Hereafter, unless otherwise required, all references will be to this transcript.
[25] I should also mention, for the sake of completeness, that Mr Adcock secured a valuation from a different valuer, Mr R, and filed his report on 26th June 2012. Among other reasons, including the very late notice, I disallowed the application of Mr Adcock to rely on Mr R’s later report regarding the valuation of the cattle.
From Mr Adcock’s oral evidence, I note the following.
Mr Adcock began to cohabit with his fiancée, Ms M, on a permanent basis from ‘after February 2011.’ He then explained why he provided no material or any relevant evidence in his trial affidavit about that relationship, including the financial “arrangements” between them. In short, he said that he did not want to put her through any extra stress given that she had breast cancer some five years or so ago. Further, he said that he had only become aware of this omission in his evidence about his fiancée when I raised it on the first day of the trial.[26]
[26] T 67-68.
I do not doubt Mr Adcock’s genuine concern for Ms M. She is aged 54 years. However, I have very significant difficulty accepting that he had not previously been advised that his partner’s financial circumstances, and his living situation with her, was a matter of some consequence and that his duty to the Court and the conduct of the property proceedings required him to give proper evidence about it. He did not do so, and the Court (and Mrs Adcock) only received evidence from Ms M very late in the trial.
He said that he and Ms M keep their finances separate. But in answer to further questions, he confirmed that he lived rent-free at Ms M’s property, he does not contribute to payment of rates, water, heating or electricity, but he does pay for some groceries.[27] In later evidence,
Mr Adcock confirmed that his fiancée had purchased for him a car, which he estimated cost $23,000, but was now worth approximately (and maximally) $12,000.[28] Unfortunately, Mr Adcock did not list any such matters in his Financial Statement at all, such as under the heading ‘expenses paid by others for your benefit.’ He said that he did not see the relevance of doing so.[29]
[27] T 69 & 126.
[28] T 134.
[29] T 127.
Not for the first time, I have the greatest difficulty in accepting that
Mr Adcock was unaware of his responsibilities to make full and proper disclosure, such as the circumstances of his living situation with Ms M. His solicitors are long-experienced in family law litigation. His evidence is tantamount to implying that his lawyers had not properly advised him.[30] Formally or otherwise, he makes no such claim. Simply, either he chose to ignore their advice, or otherwise he made a decision as to what he would or would not disclose, or what he would or would not say, in relation to his evidence. In any event, in many significant respects, his evidence regularly lacked appropriate detail. And certainly compared to the detailed documentary evidence of
Mrs Adcock, it had little to commend it.
[30] In this regard, I note that Mr Adcock confirmed that his former solicitors (also long-experienced in family law) consulted him in relation to various matters, including issues concerning the sale of [W] and the use of hay and silage on the property. His current solicitors were also advised of the same issues regarding [W]. See T 115.
Mr Adcock and Ms M plan to marry, he said, “when this matter is sorted out.” Respectfully, this open-ended, unplanned response, was instructive, in my view, because it was so lacking in precision and detail.[31]
[31] See the further, general discussion on this subject at T 119-120.
Mr Adcock confirmed that Ms M works full-time. He was unsure of her income.[32]
[32] T 70. In later evidence, Mr Adcock said that he thought she earned $1350 per week, but confirmed that this was evidence “to the best of my knowledge…” but then also conceded that he had not spoken specifically with Ms M about this information. Rather, he based his estimate on past, general conversations with her. See T 128.
Perhaps curiously, but perhaps not, Mr Adcock confirmed that (a) he was eligible for a pension but (b) had elected not to take it. He preferred to work and remain self-employed. He said that he was a reasonably proud person and that, in his view, he did not wish to take anything from anyone to which he was not entitled. He wished to remain “self-sufficient.”[33] Such decisions are, of course, a matter for him. Others may regard his decision as imprudent – and perhaps other things.
[33] T 71.
In his affidavit material, Mr Adcock contended that the properties he formerly owned in the [H] were valued, in 1988, at between $1.5 and $2 million dollars. He confirmed that these figures were his own estimate – as opposed to a formal, independent valuation.
Learned Counsel for Mrs Adcock sought to ask Mr Adcock certain questions in relation to the value of the Simmental cattle. It took a little time to get Mr Adcock to focus on the questions being asked because he sought (a) to answer what he thought the question was, (b) to avoid answering the question asked (on one occasion he said “that’s a loaded question”, following which he was cautioned about assisting the Court by answering directly, and as simply as possible, the question asked), or (c) to justify, in a manner of speaking, for action taken or not taken. As I have previously remarked, Mr Adcock’s evidence fell significantly short of the detail and directness of Mrs Adcock.
In relation to the cattle, Mr Adcock confirmed that in preparing his affidavit(s) for the current proceeding he did not check his evidence with, for example, any of the contemporaneous notes he had taken at auction in 1988.[34] In my view, his “recollection” of events, then transposed to his affidavit(s), lacked an appropriate level of accuracy. Indeed, following further questions from the Bench to the effect that contemporaneous notes of cattle prices on a given day, recorded at a particular auction, is going to be a reasonable if not better indication of price than one person’s recollection, Mr Adcock disagreed, on the basis that, because he was so involved in breeding and selling cattle, his recollection was more accurate than any note from a particular auction. I confess to having some difficulty in accepting, certainly in its entirety, Mr Adcock’s explanation. His abject refusal to accept the relevance and accuracy of contemporaneous notes of cattle prices was both unhelpful and concerning.
[34] T 73.
Further, I had the impression that Mr Adcock was almost invariably seeking to present the best possible picture of his own efforts and labours, and correspondingly, to diminish the efforts and labours of Mrs Adcock - a not uncommon experience I have to say. Respectfully, in this regard, his evidence was unfortunate and did him little credit. I comment further on such matters in a little detail later.
The next part of his cross-examination related to Mr Adcock’s ‘valuation’ of the cattle, as set out in his brief trial affidavit. Unfortunately, again I had the clear impression (as did learned Counsel for Mrs Adcock, given her questions to him and the direct challenges to his evidence as being ‘made up while in the witness box’) that
Mr Adcock was seeking to present evidence that was most favourable to him. Unfortunately, his lack of precision about how he went about the revised valuation was patent. For example, initially he told the Court that his valuation was based on 40 cattle, then it was said to be based on either 80 to 100, then he said it was based, ‘he guessed’, on 100 head of cattle. Further, he said that, for the valuation, he used “the stud value for most of them and a commercial value on the bottom end of it. But I averaged them through.” He then confirmed that he valued 100 as stud cattle and another 40 as commercial (i.e. non-stud) cattle.[35]
[35] T 74-75.
A constant difficulty, among others, with the evidence of Mr Adcock was his constant failure to address the question asked, and his regular need to explain why he was giving the answer he was. While I understand that there is no ideal witness, some (such as here) regularly fail to heed the advice and warning of the Court to address the question asked directly. Another example of this, again related to Mr Adcock’s attempts to have the Court accept his revision of the value of the cattle, concerned whether, and if so how many cattle were registered on the Australian Stock Breeders Association “herd inventory.” Mr Adcock sought to distinguish between those cattle that were stud stock but not registered on the herd inventory, those that were stud stock, registered and with their registration fees paid up to date, and those that were stud stock, registered but with their registration fees not kept up to date. To put it as neutrally as possible: Mr Adcock’s evidence was somewhat ‘flexible’ in relation to these matters.[36] And again, his evidence failed seriously at basic levels of detail and accuracy.[37]
[36] Generally, see the discussion at T 74-77.
[37] In later evidence, Mr Adcock confirmed that he bought Ms M an engagement ring, the funds for which could have been used to register the cattle. T 122.
Again, he confirmed that when swearing to the value of stock, he used his memory. He said: “… you have a memory of values – almost absolute. And I could do that for the last 40 years if I want.”[38] Unfortunately, as noted below, he could not, and did not, have the same precision he alleged in relation to many much more recent events.
[38] T 77.
Although Mr Adcock maintained in his affidavit that certain cars were part of the initial contributions by him, he confirmed that a Mitsubishi vehicle was given away shortly after he commenced cohabitation with Mrs Adcock.[39]
[39] T 79.
Mr Adcock confirmed that in relation to the value of vehicles at the beginning of the relationship it was difficult to recall because it was “22 years ago”. In my view, he was again very “flexible” in giving values to those two vehicles (the Mitsubishi and a Daihatsu 4-wheel drive) in 1988. As with his other evidence, I took him to be trying to put the very best light on his evidence, primarily for his own benefit.[40]
[40] T 80.
It is perhaps best simply to quote the following part of Mr Adcock’s evidence. Thus, in relation to household responsibilities, Mr Adcock said:[41]
[41] T 80-81.
In your affidavit, I think you tell his Honour that you and
Mrs Adcock shared the housework equally. Do you remember saying that?‑‑‑Yes.You are not telling the court, are you, that you did an equivalent amount of cooking to Mrs Adcock?‑‑‑I did cooking when it was necessary, and a lot of the time – are you referring to 1988 or now – or ‑ ‑ ‑
Throughout the entire relationship, Mr Adcock?‑‑‑I would think that it would probably be close to a fifty-fifty situation, because most of the time I was in the house on my own anyway.
Sir, in terms of an evening meal, you would cook rarely or occasionally, that’s accurate, isn’t it?‑‑‑Yes, that's right.
And Mrs Adcock would cook daily?‑‑‑When required.
I took this to be another instance of self-promotion, and an attempt to diminish Mrs Adcock’s contributions. Further, and much more directly, Mr Adcock refuted Mrs Adcock’s contributions to the farm work, certainly to the degree and the nature and extent to which she testified.[42] As already mentioned on a number of occasions, I prefer and accept Mrs Adcock’s account.
[42] T 82.
Although Mr Adcock accepted that his attendance at [omitted] took him to many places quite removed from Wagga Wagga (such as Armidale, Tamworth, Coffs Harbour, Bega, Melbourne, etc), he rejected the contention that when he was absent at such ventures
Mrs Adcock attended to any matters that required attention on the farm. Rather, he said, that her attendance to such things was limited because he arranged for assistance by others, notably his neighbour.[43]
[43] T 82-84.
Another instance where Mr Adcock sought to justify his labours and present them in a more favourable light than circumstances seem to warrant concerned the feed store/fodder business that he conducted in [H]. While he agreed that Mrs Adcock did the bookwork for it, he would concede only that she also served customers ‘if the store managers were busy.’ He confirmed that that business was closed due to “economic reasons” but not because of his bankruptcy. It is as well that Mr Adcock speak for himself about this business and his attention to financial matters at the time. He said (emphasis added):[44]
It wasn’t because the feed store was not doing well?‑‑‑I went through the figures and I realised that it wasn’t doing well enough or not as well as it should have been, because I was supplying fodder from my [H] properties, which I thought was going to be a fairly reasonable thing to assist with it, but it was not satisfactory. I believe that it was not – I was tremendously busy at the time, your Honour, and I didn’t have time to go through figures and books and whatever the case may be. I was more interested in churning out fodder and products to get there and to make sure that it was done. I wasn’t particularly au fait because Mrs Adcock was doing the office work in the business, so I was stepped aside in the financial side to make sure the product was there.
[44] T 85.
I accept Mr Adcock’s focus on the production of feed and produce. However, I have difficulty in accepting then (and now) that he paid sufficient attention to the financial side of things and left that, to a very significant degree, to Mrs Adcock. Per se, he should not be criticised for this. His gifts clearly relate to cattle breeding and attending to so many of the day-to-day activities in running a farm. In my view, it is quite clearly the case that attention to the financial demands of farming is not his forte. His evidence in this regard struck me more as ‘something will work out’, or ‘if I work hard (or harder) things will right themselves.’ In my view, but for the constant attention to the farm finances, and the very significant financial contributions to them, by Mrs Adcock, I fear that Mr Adcock would more likely than not have suffered similar financial woes and had frequent [unhappy] encounters of the kind he did from his engagement with the State Bank in the [H] at the commencement of the relationship.
In relation to the sale of plant and equipment from the [H] properties in the early 1990s, Mr Adcock contended that, in addition to the $105,000 set out in Mrs Adcock’s material, there was a further $25,000 realised that was paid in cash. Further, he said that Mrs Adcock had that cash. He confirmed that such a claim was not in his affidavit; he said it was not because he could not prove it.[45]
[45] T 85-86.
Somewhat similarly, he said that in preparing his trial affidavit and the insertion of the number of cattle that were moved from the [H] to Wagga Wagga as 150, he had simply been going with his memory. The ‘s.86 agreement’ sets the number at 120 head of cattle.[46]
[46] T 86-87.
He said further that, in addition to transferring cattle and plant and equipment to Mrs Adcock under the s.86 agreement, he transferred funds to her. He said that those funds were not “traceable.”[47] I am not completely sure what he meant by this. He said that these cash funds, said to total $30 – 40,000, were available for use by the parties. It was raised, he said, from the sale of hay. The money was kept in a safety deposit, or some other box, at the family premises. When asked why none of these funds were used to make mortgage payments, and in circumstances with a bank threatening to foreclose, he simply said, in many respects implausibly, that these funds were for living expenses.[48] In brief evidence in reply, Mrs Adcock denied knowing anything about such a cash sum or a cash box at the family premises.[49] For reasons previously given, and as with the evidence more generally, in relation to this specific matter, I accept Mrs Adcock’s evidence, and reject that of Mr Adcock.
[47] T 87.
[48] See the discussion at T 89-90.
[49] T 158-159.
In the context of a discussion regarding his knowledge (or lack of it) concerning interest rates at the time of the parties purchasing property in Wagga Wagga, Mr Adcock said that Mrs Adcock kept secrets from him. This was followed by some evidence which I confess I found perplexing, if not rather troubling.
Mr Adcock did not quibble with the fact that the parties were married for more than twenty years. He then said, however, that the marriage was successful for ‘probably six or seven years.’[50] Leaving to one side the sadness (for all) of such a comment, it struck me at the time, and remains so upon re-reading the transcript, that there was something not sound with this evidence. I say this mainly because Mr Adcock struck me forcefully as a man who would not tolerate a situation just for the sake of doing so. However, in my view, he would do so if it was in his interest. If this be even close to an accurate assessment of his evidence, it seems to me an even greater sadness (and more) that he took such a utilitarian approach to the marriage with Mrs Adcock. This is to say that, while-ever it remained in his [financial/material] interest to remain in the relationship, so to speak ‘he put up with it.’
[50] T 92.
In saying this, I do not suggest there was (or is) any malice, malevolence or otherwise by Mr Adcock. He was, and doubtless remains, an earnest, hard-working and proud farmer. Nevertheless, in the context of his long marriage to Mrs Adcock, the evidence before the Court in this property proceeding and the principles that govern it, and his oral evidence for which I give every allowance in the light of (a) his senior years, (b) some difficulty in hearing, and (c) the pressure of giving evidence, his comments displayed a sombre, deliberate and unwarranted jaundice towards Mrs Adcock, and a significant inattention with respect to (i) the length of his marriage, (ii) the very significant, regular financial contributions to the marriage by
Mrs Adcock from gifts and inheritances she received, and (iii) the proper consideration to the preparation and marshalling of evidence for the trial. Indeed, on two occasions during the trial, I suggested to
Mr Adcock that someone listening to his evidence could get the impression that he would not give any credit to the labours of
Mrs Adcock. He denied this.[51]
[51] See T 84 & 115.
Mr Adcock contended that Mrs Adcock “interfered in the running of the properties.” Although he wrote cheques, he said that he did not have free and open access to the farm finances. Put another way, he could not do as he pleased with the finances. For my part, given his financial history, it is unfair and improper for him to claim that Mrs Adcock was interfering with the finances of the farm. For reasons already given, it would have been imprudent if she had not kept the close eye on them that she did. This was more so the case in circumstances where she provided such a vast amount of funds to that farming enterprise through the gifts and inheritances she received.[52]
[52] See the discussion at T 95 with Mr Adcock agreeing that (a) Mrs Adcock had previously run a property with her former Husband that involved Simmental cattle, and (b) the importance of Mrs Adcock keeping her good credit rating, as a further reason for keeping a watchful eye on the finances.
In relation to the financing of the purchase of [W], Mr Adcock said that (a) he did not know the detail of it, then (b) he agreed with the outline put to him by Counsel for Mrs Adcock regarding the sources of funds used (noted earlier in these reasons), and (c) he disagreed that it was “entirely right”, but he confirmed that [unfortunately] he could not dispute what was put to him about the financing of [W].[53] It was almost as if the documented facts were both an irritation and an inconvenience to him.
[53] T 94.
Mr Adcock agreed, in a manner of speaking, that his affidavit evidence in relation to the number of cheques he wrote concerning the farm was erroneous. He also averred that the farm was run to minimise
Mrs Adcock’s tax liability. He seemed to me to try to avoid taking responsibility for his bankruptcy and the flow-on effects it had for the relationship. Also rather reluctantly, Mr Adcock conceded that
Mrs Adcock’s off-farm income was significant and that, from time to time, as needed, that income was directed to farm expenses.[54]
[54] T 97.
Mr Adcock did not agree with the proposition that the farm ran at a loss; he said that it was made to run at a loss.[55]
[55] T 101.
Mr Adcock confirmed that he stopped attending the farm around March/April 2011.[56] He conceded, although he did not have direct knowledge because of his inability to recall it, that Mrs Adcock had written to him on 7th March 2011 confirming that he could attend the farm to deal with the cattle at any time.[57]
[56] T 103.
[57] T 104-106.
Mr Adcock confirmed that (a) he did not attend to the cattle from April 2011, and (b) part of the reason for that was because he went on a trip to Italy with his fiancée, about which he told Mrs Adcock nothing.
He was less than clear as to the duration of and other details concerning this trip. He enjoyed a significant amount of flexibility about the finances for it (which came from a cattle breeding society of which
Mr Adcock was a delegate), but such matters are not germane to the current issues before the Court, save for a significant level of incredulity on my part at how flexible the financial arrangements for it were, and how lacking in detail Mr Adcock’s evidence was – unfortunately not for the first time.[58]
[58] T 106 – 109.
Mr Adcock confirmed that all gifts and inheritances from her parents were given directly to Mrs Adcock.[59] And he accepted that his ‘estimate’ of the cost of renovations to the kitchen at [W] was (a) from his memory, and (b) inaccurate.
[59] T 116 & 117.
He contended that certain expenses incurred by Mrs Adcock to prepare the ‘[S]’ property for sale were unnecessary because, in his view, the property was in good condition. He disapproved of the expenditure, which was now claimed by Mrs Adcock. He did agree, somewhat circuitously, that the costs incurred by Mrs Adcock for the erection of cattle yards on the properties of Lots [1] and [S] were appropriate. The steel panels for those yards had been purchased in 2004. He also agreed that Mrs Adcock continued to pay rates on those properties.[60]
[60] T 117-118.
Later in his cross-examination there was further contest in relation to Mr Adcock’s valuation of the cattle, and similarly, in relation to Mr D’s valuation of them. For example, there was a contest over whether the payment of registration fees would remedy any relevant defects in the value of the cattle, who otherwise were on the herd inventory, and the accuracy (and significance) of the stud books. Mr Adcock also contested the accuracy of Mr D’s valuation on the basis of the number of cross-bred cattle in the herd and how many were pure bred beasts. Unfortunately, much of this evidence was not in his affidavit. Indeed, he confirmed that he had not put any of this evidence before the Court.[61]
[61] See T 120-126.
I need not traverse in detail Mr Adcock’s evidence regarding (a) his ‘reimbursement of funds’ regarding a conference he helped organise, and (b) a series of cheques he banked (e.g. from the sale of cattle) and funds used for various purposes.[62] Unfortunately, imprecision characterised Mr Adcock’s evidence. The same comment applies in relation to evidence he gave concerning the ANZ bank account and how it came to be over-drawn. This was in circumstances where
Mrs Adcock wrote to Mr Adcock directing him not to write cheques on the account in question.[63]
[62] See T 129-133.
[63] T 134-137.
Mr Adcock also confirmed that, until the current proceeding is determined his only source of income is from the sale of cattle.[64]
[64] T 139-140.
Evidence of Ms M
Given the circumstances – particularly the ‘late-breaking’ nature – of Ms M’s evidence, a proof of it was prepared, given to Mrs Adcock’s lawyers, and adopted by the witness under oath in the witness box.[65] The ‘proof of evidence’ provided basic detail of her financial situation.
[65] See T 143-144. The proof of evidence became Exhibit H.
In short, Ms M confirmed that (a) she continues to have regular health check-ups in the light of her breast-cancer history (she also provided brief details of the cost of such checks), (b) she has two adult daughters, and (c) in general terms, regarding the costs associated with the trip to Italy with Mr Adcock, she paid for her expenses, although there was some sharing of costs with Mr Adcock, the details of which she could not recall.
Evidence of Mr D
I need not repeat the earlier-given detail of Mr D’s joint appointment as a single expert.
The first substantive issue raised with Mr D was a challenge to his expertise by Mr Adcock because he was “retired.” In response, Mr D confirmed that this was the first he had heard of this challenge. He then detailed (which I also need not repeat) his on-going activity in valuing cattle.[66] On this evidence I do not accept the challenge made to Mr D’s expertise. In my view, it more than satisfies the requisite standard for an expert witness by virtue of his long and on-going experience as an auctioneer and livestock consultant, having formerly been the national stud stock manager and auctioneer for Elders. He continues to be retained as a consultant to cattle studs, including studs that run Simmental cattle, and has ‘current experience’ in relation to Simmental and commercial cattle sales. Indeed, Mr D confirmed that he has recently been a consultant to a ‘major stud breeder in northern New South Wales who wished to purchase in its entirety a Simmental stud in South Australia.’[67]
[66] T 149.
[67] Generally, see Dasreef Pty Ltd v Hawchar (2011) 243 CLR 588 at [30] – [37], where the majority (French CJ, Gummow, Hayne, Crennan, Kiefel & Bell JJ) discuss the requirements and application of s.79 Evidence Act1995 (Cth). See further the detailed discussion in Cross on Evidence (Ninth Australian Edition) (J.D. Heydon) (Sydney: LexisNexis Butterworths, 2013) at [29045] ff.
He confirmed that in relation to the cattle the subject of this proceeding he did not check every ear tag or tattoo. He did not do so because he did not consider it necessary.[68] Mr D also confirmed that he was asked to value the stock on the bases of both stud cattle and commercial cattle. He took into account all relevant factors, such as whether the particular beast was prime quality, whether it was registered, and the like.[69]
[68] T 149.
[69] T 150-151.
It was suggested to Mr D that, in conversation with Mrs Adcock, she had displayed a keenness to ensure that the cattle were valued on the basis that it was a ‘pretty good herd.’ Mr D rejected the suggestion that Mrs Adcock had sought to influence his valuation. He also said that, after he had provided his valuation in a later conversation, Mrs Adcock had indicated a degree of disappointment that the valuation was not higher.[70]
[70] T 152.
Mr D also confirmed that one values stock[71]
…with every known fact about them, and as such it – the basis of the valuation is that a purchaser is willing to but aware of all facts, a vendor is willing to sell and aware of all facts but under no pressure, and I said that I would therefore be duty bound to declare that they were purebred cattle and were able to be registered, or the registration is able to be brought up to date.
[71] T 152-153. Respectfully, this description by Mr D conforms well with the description by the High Court, concerning valuation practice, in Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority (2008) 233 CLR 259.
Contrary to the proposition put to him that his valuation was based on the cattle being “pedigree, prime-quality”, Mr D said that his valuation was based …[72]
on what they were in front of me. Some of those cattle were – I understood them all to be pedigree, and I still believe that to be so or understand that to be so. They were not all prime and they were varying in condition, but in the main the condition was pretty good.
[72] T 154.
He acknowledged that prices “today” (i.e. at the date of the hearing) were weaker than they were at the time of his valuation.[73]
[73] T 154.
Mr D was then briefly taken through various scenarios of the state, number and other matters in relation to the cattle as set out in
Mr Adcock’s trial affidavit. This included a question whether
Mr Adcock’s contentions regarding the value of particular cattle was “within the ballpark.” Mr D agreed. However, in my view, the following comments from Mr D were more helpful and more to the point, particularly in circumstances where he had not seen any of the cattle for approximately one year since his valuation.
First, he confirmed that his comments (and valuation) were not and could not be the same as Mr Adcock because “he was the owner.” Secondly, in answer to the proposition that in order for a ‘more accurate valuation’ to be given he would need to see the cattle [again], Mr D said:[74]
Livestock values vary daily; they vary daily for a multitude of reasons including carbon tax. They value according to seasonal conditions; they value according to their current condition; they value according to supply and numbers supplied through the selling centres. I could do and have done on a number of occasions a valuation of various forms of livestock. It has been contested and it has had to be done again within a week and then if it’s contested, it could be done again within another week. We can see five and 10 cents a kilo on a layaway basis for butcher cattle; we can see five and 10 cents a kilo drop or rise in a week. So it’s very – it’s not like saying, “I have a motor car that cost $20,000. It has depreciated by $5000 the day I buy it and it’s still worth that next week”. It’s – anything that lives and breathes varies quite significantly.
[74] T 156.
In my terms (without intending to be either crude or trite), the valuation of cattle is clearly a moveable feast. Indeed, when asked further if certain cattle of a certain age at the time of his valuation had since been fattened up, Mr D further commented:[75]
But at that particular time, the older ..... steer weaners were consistently making between seven and $850 – 700 and $850 – consistently making it. Now ..... is the time that you could buy or have weaners worth $800. You can spend 12 months getting them fat and they might still only be worth $900 or $1000 because the market fluctuates. It not only fluctuates for the weaners that you had at the time because these weaners aren’t eight to 12 months anymore. As you’re suggesting to me, they’re 20 to 24 months – steers. But the price per kilo of young cattle is generally higher than the price per kilo of cattle as they get up to – I’ve got to speak in laymen’s terms – to where they cut their teeth and become older trade beasts. If I were asked to guess – which I am now being asked – that those particular steers, if they have been kept on and are still there and had been kept on on good feed for the last 12 months and are still there, they would be pretty near two years of age. I would suggest to you that they’re probably worth – they possibly would be worth $1000. But I’m not valuing them now because I haven’t seen them now.
[75] T 157.
In the light of Mr D’s helpful evidence, which I accept, and given (a) how many variables may or may not be relevant at any one time in the valuation of cattle, and (b) Mr Adcock’s affidavit evidence in relation to the value of the cattle must be seen through the lens of him being a significantly interested party in the outcome of this matter (accepting his general expertise with cattle), in my view, the only proper course is to accept Mr D’s valuation of the cattle as at the date of the valuation. Such a course avoids the risk of Mr Adcock’s evidence as a [putative] expert in his own case, and treats the value of the cattle, for both parties, in the same way at the same time. If this course was not followed, I fear (among other things) that we would be unlikely to reach agreement even as to the date of any new valuation. Accordingly, for the purposes of the asset pool, the value of the cattle will be as per the valuation of Mr D.[76]
[76] See the discussion by the Full Court in AJO v GRO (2005) 33 Fam LR 134, at [16] – [17] in relation to dates for valuation, and confirmation of the discretion that resides in the trial court to determine that a particular date for valuation is more appropriate than another date for the purposes of the particular matter. This is such a case for the reasons given.
The Asset Pool
In accordance with Full Court authority, and subject to the further comments of the High Court in relation to the requirement only to make orders where, in all the circumstances, it is just and equitable to do so, I propose to follow the so-called, ‘usual four-step process.’[77] Before proceeding thus, I note the following from the High Court decision in Stanford v Stanford, specifically for the purposes of considering of s.79(2) of the Act, and whether it is just and equitable to make an order to adjust property interests between the parties.
[77] See, for example [again], AJO v GRO at [46]. And see further the High Court discussion in Stanford v Stanford (2012) 293 ALR 70 at [35] – [42]. More recently still, see the discussion of Coleman J in Martin & Crawley [2012] FamCA 1032, and by Murphy J in Watson & Ling [2013] FamCA 57.
First, at [35], the plurality (French CJ, Hayne, Kiefel and Bell JJ) said:
It will be recalled that s 79(2) provides that "[t]he court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order". Section 79(4) prescribes matters that must be taken into account in considering what order (if any) should be made under the section. The requirements of the two sub-sections are not to be conflated. In every case in which a property settlement order under s 79 is sought, it is necessary to satisfy the court that, in all the circumstances, it is just and equitable to make the order.
Secondly, at [42], the plurality also said:
It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).
Because the criteria to which the High Court referred, and to which I have just referred, have been satisfied here, it is appropriate that there be orders to adjust, according to principles that are just and equitable under s.79(2) of the Act, the ‘matrimonial property’ to which I now refer in more detail.
In the light of the evidence referred to, and my findings regarding the detail of the acquisition and sale of property, gifts and inheritances, and all other matters, which invariably involve the Court accepting the Wife’s evidence in preference to that proffered by Mr Adcock, it follows that the document styled “Joint List of Assets & Liabilities” submitted by the Wife should also be accepted as constituting the assets available for equitable division. That document is reproduced below; helpfully it also sets out the few areas of the competing claims made by Mr Adcock, for comparative purposes. In short, subject to the discussion regarding “add-backs”, the assets properly considered should be taken to be as asserted by the Wife.
The categories of ‘assets’ that should be added-back to a property pool were succinctly set out in AJO v GRO, at [30]. Thus add-backs in relation to legal fees are properly to apply here and will be added back, as per the list of assets and liabilities recorded in the table below. Likewise, unaccounted for distribution of funds should be added back. In my view, in the absence of proper explanation from Mr Adcock, the funds taken from the farm account between March 2010 and April 2011, in the sum of $52,900, should be added back to the pool.
The contest, claimed by Mr Adcock, in relation to oats and silage (to the value of $46,000), in my view, was satisfactorily dealt with in
Mrs Adcock’s evidence and should not be added back.
Accordingly, the assets appear thus (as taken from the Wife’s document entitled “Joint List of Assets and Liabilities”).
JOINT LIST OF ASSETS & LIABILITIES
| Assets | Ownership | Wife’s value | Husband’s value |
| Proceeds from the sale of “[W]” | Trust | $941,830.07 | $941,830.07 (Agreed) |
| Proceeds from the sale of water licence | Trust | $42,063.37 | $42,063.37 (Agreed) |
| [S] Lots [1] and [2] | To be sold | To be sold | To be sold |
| Shares in the wife’s name | W | $118,000.00 | $118,000.00 (Agreed) |
| Co-op shares (wife) | W | $3,000.00 | $3,000.00 (Agreed) |
| Shares in the name of the Husband | H | Not known | $5,000.00 |
| Stock · In Husbands possession pursuant to orders of the court 16.6.11 · In Wife’s possession pursuant to orders of the court 16.6.11 | H W | $249,000.00 $15,000.00 | $150,850.00 $16,800.00 |
| Semen | H | $4,182.00 | $4,182.00 (Agreed) |
| Super | W | $10,000.00 | $10,000.00 Agreed) |
| Vehicles: · Mercedes (husband’s possession) · Hyundai · Toyota Landcruiser | H W | $26,850.00 $13,000.00 | $26,850.00(Agreed) $13,000.00 (Agreed) $38,000.00 (Agreed) |
| Addback (husband): · Payment to husband for legal costs 8.9.11 · Monies taken from farm account March 2010 to April 2011 | H H | $20,000.00 $52,900.00 | $20,000.00 (Agreed) Not agreed |
| Addback (wife): · Payment to wife for legal costs 8.9.11 | W | $20,000.00 | $20,000.00 (Agreed) |
| · Oats, sileage etc handed in | W | Not agreed | $46,000.00 |
| Total Assets | $1,553,825.44 | $1,458.075.44 |
| Liabilities | Wife’s value | Husband’s value |
| Repayment to the wife expended from off farm income for farm purposes | $66,829.54 | Not agreed |
| Total Liabilities | $66,829.54 | Nil |
| Total net Assets | $1,486,995.90 | $1,458,075.44 |
Contributions
The contributions of the parties, in my view, fall into two categories. The first relates to the contributions at the commencement of the relationship; the second relates to the contributions during it.
The contributions at the commencement are, plainly, the proceeds from the forced sale of Mr Adcock’s [H] properties, and the proceeds from Mrs Adcock’s property settlement in relation to her first marriage. Although there is a slight difference, in dollar terms, between those two amounts, there are two particular considerations here.
The first matter here is what, if any, effect or import, is the parties having entered into a deed pursuant to s.86 of the Act. And related to this is the effect on the financial relationship (for the purpose of the current proceeding) of Mr Adcock’s bankruptcy.[78] Further, it should be remembered that there was a very significant shortfall to Mr Adcock’s creditors (notably the State Bank of NSW) which, in my view, must also be a consideration, but which is otherwise unaccounted for.
[78] Basic details of Mr Adcock’s bankruptcy are set out in the extract from the Insolvency Trustee Service Australia: Exhibit J.
For her part, Mrs Adcock contends that this deed and the assets secured for the parties under it constitute a contribution by her.
For my part, any such contribution must properly take account of the fact that, but for Mr Adcock’s properties, there would be no assets for the parties to take with them under the agreement, however limited they might be.
The second aspect in relation to the early contributions concerns the comments in cases such as Pierce and Clives v Clives, where at [44] in the latter case, the Full Court (Warnick, Boland & Cronin JJ) cautioned that the task to be undertaken at trial “in assessing weight to be attached to initial contributions, and other contributions, is not always an easy one and not discharged by a strict accounting exercise.”[79]
[79] Pierce & Pierce (1998) FLC ¶92-844. Clives v Clives (2009) 40 Fam LR 273. See also similar comments by the Full Court (Bryant CJ, Finn & Boland JJ) in TWN & PAQ (2006) 34 Fam LR 190 at [79].
In Pierce, at [28], the Full Court (Ellis, Baker & O’Ryan JJ) referred to the point being not one of “erosion” of the earlier contributions but rather the relevant “weight” to be ascribed to them in the light of all the other circumstances and contributions.
The second area of consideration relates to the nature and extent of the contributions during the relationship. In this regard, there is no dispute that (a) Mrs Adcock received very significant gifts and inheritances, which were, in turn, applied to the labours and enterprises of the relationship, and (b) during the relationship, Mrs Adcock worked ‘off-farm’, while Mr Adcock worked the farm. There is also no dispute that Mrs Adcock consistently did the accounts for the farm; there is a dispute – in my view, of degree only – as to how much work
Mrs Adcock did on the farm (Mr Adcock concedes that she did some, but not as much as she claimed), and how much ‘domestic labour’
Mr Adcock contributed.
In relation to the gifts and inheritances, Mrs Adcock contends that the frequency and size of them takes them out of the so-called usual way of dealing with them in long-marriage cases. Among others, Mrs Adcock relies on the Full Court decision in Kessey.[80] For his part, Mr Adcock simply says that, according to the majority decision in Aleksovski, and by Murphy J in Smith & Fields, the Court should (a) not treat the gifts and inheritances as some special or protected category, (b) have regard to the overall contributions in the light of ‘the nature and form of the particular union’, including whether the parties plan and execute decisions together.[81]
[80] In the Marriage of Kessey (1994) 18 Fam LR 149.
[81] Aleksovski v Aleksovski (1996) FLC ¶92-705; Smith & Fields [2012] FamCA 510.
By way of formal findings, I note the following:
i.Having regard to the length of the marriage and the unusual circumstances at its commencement, the most appropriate course is to regard the initial contributions as effectively equal. It should be taken, therefore, that I do not regard, in the larger scheme of things, Mr Adcock’s bankruptcy as a determining factor in the assessment of the initial contributions. Significant it was; so too was the outstanding and unsatisfied debt still owing to the State Bank following the sale of Mr Adcock’s properties. Nevertheless, in the light of the circumstances of the relationship, the initial contributions should be taken as being essentially equal.
ii.
In relation to the contributions throughout the marriage, having regard to the fact that both parties worked throughout the relationship – Mr Adcock in running the cattle, and
Mrs Adcock primarily in office work – in my view, the most appropriate way to treat the contributions in this regard is that those contributions should be taken to be equal. But that is not the end of the story.
iii.In relation to the domestic contributions, as I have earlier indicated, I do not accept Mr Adcock’s evidence to the effect that he did approximately half; and I accept Mrs Adcock’s evidence in relation to her contributions in relation to the farm work.
iv.
This leaves the Court’s consideration of the gifts and inheritances to Mrs Adcock and her application of those funds to the farm. It is clear (nor is there any dispute) that the last funds received by Mrs Adcock in these respects were approximately six years before the end of the marriage. In my view, that time frame does not militate against a very significant adjustment in her favour in relation to these contributions. Further, in written submissions, post-trial, learned Counsel for Mr Adcock confirmed, at para.33, that
Mr Adcock concedes that Mrs Adcock’s financial contributions were more because of the gifts and inheritances she contributed throughout the marriage and the division should therefore be in her favour. The contest is clearly over to what degree the award should be in Mrs Adcock’s favour.
v.In relation to post-separation contributions, I accept the submission on behalf of Mrs Adcock that she expended $66,829.54 from her off-farm income to farm expenses. I also accept the submission that if she is reimbursed those expenses, they cannot be claimed towards the contribution assessment.
vi.In her trial affidavit, Mrs Adcock deposed to cashing in her superannuation, which realised $160,000. It was used to pay the parties’ debts. There was no challenge to this. It too must be considered as a very significant contribution by the Wife.
vii.Accordingly, in relation to contributions during the relationship, and on the basis that both parties worked full-time (which contributions I would take, therefore, to be equal), I find that they favour Mrs Adcock in relation to (a) her domestic contributions, (b) her assistance on the farm, and (c) most significantly, in relation to the gifts and inheritances, which were applied to the farm enterprise. I also find that her payment of joint debts from her cashed-in superannuation to be significant. Put another way, both parties worked full-time, and the fruit of that full-time work (Mr Adcock on the farm, and Mrs Adcock at her ‘off-farm’ employment) went into the joint farming enterprise. Over and above that return from their employment were Mrs Adcock’s substantial gifts and inheritances, which she also applied to the joint enterprise of the farm. An allowance should be made in her favour of 21%.
Section 75(2) Factors
In relation to s.75(2) factors, I note the following by way of summary.
I have already recorded that the Applicant Wife is aged 67, and the Respondent Husband is aged 72. The Wife is employed full-time as a [omitted]. The Husband is a self employed cattle farmer. Mr Adcock is eligible, but confirmed that he did not intend to apply, for a pension.
Mrs Adcock has not re-partnered. Mr Adcock has re-partnered with Ms M. She works full-time and earns approximately $74,000. She owns her own home, subject to a mortgage of approximately $130,000. She has savings of $220,000 and superannuation of $60,000.[82]
Mr Adcock lives rent-free with Ms M, and contributes modestly to groceries, but provides no other contribution to rates, electricity and the like. Ms M purchased for Mr Adcock a new car for an initial cost of approximately $23,000, some 10 months or so prior to the trial. Ms M has some health issues.
[82] These figures are set out in Ms M’s ‘proof of evidence’, which was adopted by her under oath and which became Exhibit H.
No formal evidence was provided in relation to the health of the parties, although Mr Adcock gave evidence in relation to certain knee operations, but which he did not think would impact adversely on his capacity to run another cattle farm in due course – which remains his preference in due course.[83]
[83] See T 126-127.
Although both parties are of retirement age, there was no suggestion that either of them intends retiring. Indeed, quite the reverse was indicated.
In my view, having regard to the income-earning capacity of the parties (which favours Mrs Adcock), their generally sound health, their ages (which also favours Mrs Adcock), and their current circumstances (with Mr Adcock having re-partnered and is, in almost every respect, very comfortably provided for), in my view, there should be no adjustment under s.75(2).
Conclusion
It remains to consider whether, on the basis of the evidence considered, the analysis of each of the relevant steps, and the submissions, whether the orders of the Court are just and equitable.
In my view, having regard to the size of the pool, and the fact that it is agreed that the final property of the parties is to be sold and the net proceeds divided according to the ultimate percentage division determined by the Court, a particular focus on percentages is not inapt here. This is so notwithstanding the admonition in Russell v Russell where the Full Court (Ellis, Finn & Mushin JJ) said (emphasis in original): “… it must be remembered … that under s.79(2) of the Act, the Court is required to be satisfied that it is the order to be made which is just and equitable, not just the underlying percentage division of the net value of the parties’ assets.”[84]
[84] Russell v Russell (1999) FLC ¶92-877 at p.86,439.
Indeed, given the size of the pool, the effect of a percentage division of it makes plain the not insignificant funds that will flow to each party. Added to the ultimate, net figures, there will also be the funds from the sale of Lots [1] & [S] in due course.
I should simply observe that Mr Adcock is well housed; he has a not insignificant herd of cattle from which (and from time to time) he has sold such beasts, and doubtless he will continue to sell, to earn income.[85] He will doubtless continue to attend [omitted] from which he seems to earn some “honoraria”, albeit of unknown amount and frequency. It is also unknown whether his labours on behalf of the cattle breeding association of which he is a long-time member will, from time to time, elicit further funds. And he has the benefit of his fiancée, her income and her cash assets – in addition to her current abode. He also has the relatively new car purchased for him by Ms M.
[85] The division of the herd between the parties took place following a private mediation held relatively early in the piece.
In my view, the ultimate percentage division of the net asset pool should be 72% in favour of Mrs Adcock, and 28% in favour of
Mr Adcock. In my view, in all of the circumstances, such is a just and equitable division.[86]
[86] See here, in obviously very different factual circumstances, the brief discussion by the Full Court of a slightly similar division in Dakin & Dakin [2012] FamCAFC 120.
Two final matters require attention.
First, the Wife seeks a costs order in relation to the preparation of written submissions. This is so on the basis that, had the trial proceeded without interruption on the first day, it would have concluded in the time allocated, thereby obviating the need for written submissions.
In addition, I note [again] that, because of the failure of Mr Adcock to provide all the evidence in his case, and in a timely manner in accordance with the time-table ordered by the Court, the trial did not conclude in the time provided – hence the need for written submissions (in chief and in reply to those on behalf of Mr Adcock).
In my view, there should be a costs order against Mr Adcock, for the reasons given, in relation to the preparation of written submissions. That order shall be in the sum of $5000.
Finally, and more generally in relation to costs, in the absence of any submission in writing within seven (7) days of these orders, in all of the circumstances of the case, there will be a self-executing order that each party shall pay their own costs.
Subject to the orders here indicated, I make orders as sought by the Wife.
I certify that the preceding one hundred and fifty-nine (159) paragraphs are a true copy of the reasons for judgment of Neville FM
Associate:
Date: 22 March 2013
0
11
2