Agius & Agius
[2022] FedCFamC1F 809
•21 October 2022
Federal Circuit and Family Court of Australia
(DIVISION 1)
Agius & Agius [2022] FedCFamC1F 809
File number(s): MLC 12548 of 2018 Judgment of: HARTNETT J Date of judgment: 21 October 2022 Catchwords: FAMILY LAW – Parenting – Where the parties agreed to equal shared parental responsibility at the conclusion of the trial – With whom the child should live – Spend time arrangements – Where the husband perpetrated family violence against the wife – Where the parties’ elder adult child has significant mental health and behavioural issues – Where the subject child has Autism Spectrum Disorder – Where both the adult child and subject child live with the mother – Where the father seeks for the child to reside with him and to change schools – Where the mother encourages the child father relationship – When the child’s best interests are promoted by a continuation of his residence with the mother – No change of school – Where substantial and significant time spent with the father.
FAMILY LAW – Property – Alteration of property interests – Where it is just and equitable to adjust the parties’ property interests – Where the parties’ have a self-managed superannuation fund which has real property which must be sold – Where the wife has a large tax debt – Where the husband resides in the self-managed superannuation fund property and has incurred penalties in respect of such occupation – Where the wife has made a post separation contribution to the welfare of the children – Where the wife has income and earning capacity greater than the husband – Where the net asset pool is considerably reduced by virtue of the parties liabilities – Where the parties business was placed in liquidation – Where a division of 50% to the wife and 50% to the husband should be made.
Legislation: Evidence Act 1995 (Cth) s 140
Family Law Act 1975 (Cth) ss 4AB, 60B, 60CA, 60CC, 61DA, 79, 90XC(1), 90XT(1)(a)
Income Tax Assessment Act 1936 (Cth) s 109G(4)
Family Law (Superannuation) Regulations 2001 (Cth) reg 13
Superannuation Industry (Supervision) Regulations 1994 (Cth) reg 4.09A(2)
Cases cited: Bell & Nahos [2016] FamCAFC 244
Bevan & Bevan (2013) FLC 93-545
Dickons v Dickons (2012) 50 Fam LR 244
Mulvany v Lane (2009) FLC 93-404
Stanford v Stanford (2012) 247 CLR 108
Whisprun Pty Ltd v Dixon (2003) 200 ALR 447
Division: Division 1 First Instance Number of paragraphs: 187 Date of hearing: 28 - 29 June 2022 Place: Melbourne The Applicant: Litigant In Person Counsel for the Respondent: Mr Atkinson Solicitor for the Respondent: AFL Kordos Lawyers ORDERS
MLC 12548 of 2018 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR AGIUS
Applicant
AND: MS AGIUS
Respondent
order made by:
HARTNETT J
DATE OF ORDER:
21 october 2022
THE COURT ORDERS THAT:
Parenting
1.All previous parenting orders be discharged.
2.The parties have equal shared parental responsibility for the child, X born 2007 (“the child”).
3.The child live with the mother.
4.The child spend time and communicate with the father as follows:
(a)during the school term:
(i)each alternate week, to commence within the following 14 days of these orders on such date as agreed between the parties, from the conclusion of school (or 4.00pm if a non-school day) on Friday u4ntil 6.00pm on Sunday, with such time to be extended to 6.00pm on Monday if the following Monday is a public holiday or a non-school day; and
(ii)once each alternate week, being the week in which the child would not otherwise see the father, on Tuesday from the conclusion of school until 7.00pm with the father and the child to spend such time in Melbourne, and the father to collect the child from school and return the child to the mother’s residence. Such order is subject to the father notifying the mother at least 48 hours in advance of his availability to exercise this period of time with the child.
(b)during the school term and long summer holidays:
(i)in 2022 and each even numbered year thereafter, for the second half of each school term holiday period from 9.00am on the middle day of the school holiday period until 5.00pm on the day before the first day of the next school term; and
(ii)in 2023 and each odd numbered year thereafter, for the first half of each school term holiday period from the conclusion of school on the final day of school until 9.00am on the middle day of the school holiday period.
(c)notwithstanding any other order to the contrary, in the event that the child is not otherwise in the father’s care, the child spend time with the father during the following periods:
(i)from 4.00pm on Christmas Day until 4.00pm on Boxing Day in 2022 and each even-numbered year thereafter;
(ii)from 3.00pm on Christmas Eve 2023 until 4.00pm on Christmas Day and each odd-numbered year thereafter;
(iii)from 9.00am on Good Friday to 4.00pm Easter Sunday in 2023 and each odd-numbered year thereafter;
(iv)from 4.00pm on Easter Sunday to 9.00am on Easter Monday in 2024 and each even-numbered year thereafter;
(v)from 4.00pm on the Saturday before Father’s Day to 6.00pm on Father’s Day;
(vi)from 4.00pm on the father’s birthday each year until 4.00pm the next day; and
(vii)for the child’s birthday, on the first Saturday following the child’s birthday from 4.00pm until 12 noon the following day with the mother to collect the child from the father’s residence; and
(d)as otherwise agreed between the parties.
5.Unless otherwise agreed, the child’s time with the father pursuant to Order 4(a) be suspended during the end of school term and long summer school holiday periods and recommence in the same cycle as provided for in these orders as if his time was not interrupted by the school holiday periods.
6.That notwithstanding any other order to the contrary, in the event the child is not otherwise in the mother’s care, the child spend time with the mother during the following periods:
(a)from 4.00pm on Christmas Day until 4.00pm on Boxing Day in 2023 and each odd numbered year thereafter;
(b)from 3.00pm on Christmas Eve 2024 until 4.00pm on Christmas Day and each even-numbered year thereafter;
(c)from 9.00am on Good Friday to 4.00pm Easter Sunday in 2024 and each even-numbered year thereafter;
(d)from 4.00pm on Easter Sunday to 9.00am on Easter Monday in 2025 and each odd-numbered year thereafter;
(e)from 4.00pm on the Saturday before Mother’s Day to 6.00pm on Mother’s Day;
(f)from 4.00pm or the conclusion of school on the mother’s birthday to 4.00pm or the commencement of school the next day;
(g)for the child’s birthday, on the first Saturday following the child’s birthday from 9.00am to 4.00pm, with the father to collect the child from the mother’s residence; and
(h)from 3.00pm or the conclusion of school if a school day, on the eve of Lunar New Year until 9.00am or the commencement of school on the day following Lunar New Year.
7.Unless otherwise agreed during school terms and school holidays, the father collect the child (at the commencement of his time with him) from school, or from the mother’s residence if a non-school day or public holiday, with the father to return the child to the mother’s residence at the conclusion of his time.
8.Both parties be at liberty to telephone the child at all reasonable times when the child is in the care of the other parent, and both parties shall facilitate the child communicating by any means with the other parent when the child is in their care.
9.Both parties be at liberty to attend the child’s school for the purposes of attending parent-teacher interviews, school concerts, and special events to which parents are normally invited.
10.The mother and father each authorise and direct all school, education facility and extracurricular provider of the children to provide each party (at their request and cost) all information reasonably provided regarding their attendance, including but not limited to notices, information, newsletters, reports and/or photographs.
11.Both parties keep the other informed of any medical issues involving the child whilst in their care, including any medical appointments, medical treatment and medication prescribed and both parents are permitted to attend such appointments.
12.The mother and father each keep the other informed of their current residential address and telephone contact numbers and notify the other in writing within seven days of any change.
Property
13.The parties forthwith do all acts and things to instruct B Lawyers to transfer the funds being held on trust for the parties by B Lawyers (“the trust funds”) as follows:
(a)into the trust account of C Lawyers in the sum of $25,440.13 being property received by the husband pursuant to this Order; and
(b)into an account to be nominated by the wife, the remaining trust funds with such trust funds forthwith to be applied by the wife against the liabilities owing to the Australian Taxation Office in the name of the wife, and D Pty Ltd, with such payments to be applied against the oldest liabilities first, so as to minimise interest payments.
14.The parties be liable for the entirety of any and all taxation liabilities incurred (both during the relationship and since separation) in the parties’ personal names, and in the name of any commercial entity and/or trust controlled by the parties for all financial years up to and including the financial year ended 30 June 2021, in the following proportions:
(a)the husband be liable for 50% of the taxation liabilities; and
(b)the wife be liable for 50% of the taxation liabilities.
15.The parties shall do all acts and things and sign all documents necessary to minimise the taxation liabilities of the parties and/or the corporate entities owned by them or either of them.
16.The taxation liabilities referred to in Orders 13, 14 and 15 hereof expressly include any ultimate increase of such taxation liability which may occur as a result of the application presently before the Commissioner for Taxation under subsection 109G(4) of the Income Tax Assessment Act1936 (Cth), and the wife is to keep the husband informed in relation to such application.
17.Having been accorded procedural fairness in relation to the making of these orders, Orders 19 to 31 hereof are binding on the parties in their capacities as Directors of Agius Superannuation Pty Ltd (“the Trustee”) (being the Trustee of Superannuation Fund 1 and/or E Pty Ltd (the holding Trustee pursuant to Deed dated 12/10/17) (“SMSF”)).
18.The parties sign all documents and do all things necessary to sell by auction (“the sale”), the real property situated at and known as H Street, F Town, in the State of Victoria (“the F Town property”) (registered in the name of E Pty Ltd) more properly identified in Certificate of Title Volume … Folio …, within 60 days hereof or otherwise by written agreement between the parties.
19.Within seven days of the date of these orders, the wife propose three real estate agents from which the husband is to select a real estate agent within seven days of such nomination, and if the husband fails to so select, the wife be at liberty to select a real estate agent unilaterally.
20.The wife have the conduct of the sale and that she keep the husband reasonably informed of the sale process.
21.The proceeds of the sale be applied as follows:
(a)first, to pay all costs, commissions and expenses of the sale;
(b)secondly, to discharge registered mortgage dealing number … to the G Bank, secured against the F Town property;
(c)thirdly, to pay any tax assessed against the SMSF (including Capital Gains Tax) as a result of the sale; and
(d)finally, the balance of the proceeds of sale be deposited into G Bank account number ending …20 (in the name of the SMSF) pending implementation of the superannuation provisions contained in these orders.
22.Within 14 days of the date of this Order, the husband vacate and provide to the wife vacant possession of the F Town property.
23.The parties sign all documents and do all things necessary to sell all other non-cash assets (if any) of the SMSF forthwith and deposit any monies received as a result of such sale or sales in the SMSF G Bank account number ending #0920.
24.Within 14 days of the date of these orders, the parties in their capacity as Directors of the SMSF Trustee company cause Agius Superannuation Pty Ltd to do all such acts and things necessary to engage VV Financial Services (“VV Financial Services”) to promptly prepare financial statements and tax returns for the financial years ended 30 June 2018, 30 June 2019, 30 June 2020, 30 June 2021 and 30 June 2022 (“the tax returns”) for the SMSF and do all things necessary to enable VV Financial Services to prepare and lodge the tax returns and that the cost of preparing the tax returns be borne by the SMSF.
25.To give effect to Order 24 herein, within seven days of the date of these orders, the husband do all such acts and things and provide all documents required by VV Financial Services to enable the completion of the tax returns, including but not limited to all invoices and receipts relating to renovations effected to the F Town property in the 2018, 2019, 2020, 2021 and 2022 financial years.
26.Any liabilities (including taxation liabilities) owing by the SMSF arising from the completion of the tax returns as provided for in Orders 24 and 25 herein be borne by the SMSF, save for that any penalty, fine, or liability (including taxation liability) incurred by the parties, or the SMSF or other such entity in which the parties may have an interest, that arises as a result of the husband residing in the F Town property, shall be paid from the husband’s interest in the SMSF after the wife’s interest in the SMSF has been rolled out pursuant to Orders 27 to 30 herein.
27.The base amount to be allocated to the wife out of the interest of the husband in the SMSF is the amount calculated as 50% of the total value of the SMSF less the wife’s member balance in the SMSF.
28.In accordance with s 90XT(1)(a) of the Family Law Act 1975 (Cth) (“the Act”) the wife is entitled to be paid the base amount allocated in Order 27 herein and the entitlement of the husband is correspondingly reduced by the same amount (“the payment split”).
29.The parties, both personally and in their capacities as Directors of Agius Pty Ltd, the SMSF Trustee company, do all acts and things and sign all documents as required to transfer the payment split to a complying superannuation fund nominated by the wife (“the wife’s nominated fund”).
30.The operative date for the purposes of Orders 27 and 28 is 30 days after completion of the settlement of the sale.
31.Upon the payment split, the parties do all acts and things and sign all documents as may be necessary to rollover the wife’s member interest in the SMSF to the wife’s nominated fund.
32.Following completion of Order 31 herein, the parties do all acts and things and sign all documents as may be necessary to rollover the husband’s member interest in the SMSF into a complying superannuation fund to be nominated by the husband.
33.Pending the transfer of the benefits to the parties nominated funds, each party is restrained from dealing with or disposing of any of the assets of the SMSF other than in accordance with the terms of these orders or the joint written consent of the parties (such consent not to be unreasonably withheld) and each party immediately revoke any binding death benefit nomination already made and each party be and is hereby restrained from:
(a)making any binding death benefit nomination in favour of a child described in reg 13 of the Family Law (Superannuation) Regulations 2001 (Cth);
(b)making any other nomination where the effect of such nomination would be to render any splittable payment not splittable; and
(c)doing any act or thing which would defeat, extinguish or reduce the entitlement of either party under this Order.
34.Following the implementation of the payment splits, the rollover of the parties’ respective entitlements to their respective nominated superannuation accounts, the parties do all such acts and things and sign all documents necessary to wind up the SMSF and deregister the Trustee and further engage VV Financial Services accounting to assist them to do so. The SMSF to pay for all costs of such wind up and deregistration.
35.In the event that the parties or either of them fail to provide any signed document required pursuant to these orders, and within seven days of a request in writing for such signature, then an officer of the Court shall sign such document/s on behalf of the party and pursuant to s 106A of the Family Law Act 1975 (Cth).
36.Each of the parties shall retain ownership of those corporate entities and trusts owned by them, being D Pty Ltd as owned by the wife, Agius2 Pty Ltd as owned by the wife, and Agius Family Investments Pty Ltd as owned by the husband.
37.Unless otherwise specified in these orders and save for the purposes of enforcing these orders:
(a)each party be solely entitled to the exclusion of the other to all other property (including choses-in-action and motor vehicles) in the possession of such party as at the date of these orders;
(b)monies standing to the credit of either party in any bank, building society or investment account are to remain the property of the account holder;
(c)monies standing to the credit of either party in any bank, building society or investment account are to remain the property of the account holder;
(d)insurance policies remain the sole property of the named owner;
(e)each party, be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders;
(f)each party, be solely liable for and indemnify the other against any liability in that party’s sole name including but not limited to income taxation liabilities; and
(g)any joint tenancy of the parties in any real or personal estate is expressly severed.
38.There is general liberty for both parties to apply as to the operation of these orders.
39.Otherwise, all extant applications are dismissed and removed from the list of cases awaiting hearing.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Agius & Agius has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
HARTNETT J
Introduction
On 30 October 2018, the applicant husband (“the husband”) filed an Application for Final Orders. He sought that the parties’ children live with him and spend four nights a fortnight with the respondent wife (“the wife”) to be each alternate weekend from the conclusion of school Thursday to the commencement of school Monday and each alternate week from the conclusion of school Tuesday to the commencement of school Wednesday, together with half school holiday time and other special occasion time.
The husband sought unspecified property orders being on such terms as determined by the Court.
On 28 November 2018, the wife filed a Response to Final Orders. She sought parenting orders that the parties’ children live with her and spend five nights a fortnight with the husband, in addition to half school holiday time and special occasion time. The wife also sought property orders. The wife sought other orders in respect of the parties’ corporate entities and family trusts, and sought that the parties net assets, including superannuation, be divided between the parties’ such that the wife receive 60 per cent of the total net asset pool and the husband receive 40 per cent.
The parties met in late 1997, commenced cohabitation in early 1998, and were married in early 1999. On 27 August 2018, the parties separated but remained living under the one roof at the former matrimonial home situated at J Street, Suburb L in the State of Victoria (“FMH”) until 30 August 2018. The parties obtained a divorce in late 2021. The parties cohabitation period had been approximately 20 years and 5 months.
There are two children of the marriage, Mr K (“Mr K”) born 2003 and aged 18 years at trial, and the remaining child of the proceeding X (“X”) born 2007 and aged 14 years at trial. Both children have remained in the wife’s primary care since separation some four years ago. X has, in that intervening period, spent regular time with his father, and currently spends alternate weekends during school term, holidays and special occasion time with his father.
The husband was born in 1962 and was aged 59 years at trial. He is in good health, save he suffers from Type II diabetes, hypertension and chronic pain in his right wrist. The husband is unemployed and is in receipt of income protection insurance policy payments amounting to $76,388 gross per annum.
The wife was born in 1968 and was aged 53 years at trial. She is in good health save she attends a psychologist for trauma. The wife is self-employed as a consultant for Agius2 Pty Ltd as trustee for the M Unit Trust and works from home. The wife is currently in receipt of income in the sum of $436,384 gross per annum.
The parties elder son Mr K has significant health issues. He has been diagnosed with mental health issues and substance abuse. At trial, Mr K had returned to his mother’s home after a two month stay at the N Hospital. He was under a Community Treatment Order and being treated by a psychiatrist from O Health Service.
X has been diagnosed with ASD. He is otherwise in good physical health and progressing well at school with the assistance of a guidance counsellor and social connections program.
The wife’s evidence, that over the course of the parties’ relationship the wife was the victim of family violence perpetrated by the husband against her, was unchallenged by the husband as to verbal abuse, and otherwise one incident only, as described below.
In mid-2018, two months before final separation, the wife considered committing suicide as a consequence of her being in (with the husband) what she perceived to be “a soul-destroying abusive relationship I couldn’t escape”.[1] The wife had suggested to the husband on a number of occasions, over some years that the parties should separate. The husband disagreed. Prior to, and around this time, the wife had relied for emotional support upon a friend, Mr P (“Mr P”). In mid-2018, the wife commenced a romantic relationship with Mr P. The husband discovered the wife’s relationship with Mr P after going through the wife’s mobile phone.
[1] Wife’s affidavit filed 24 June 2022, paragraph 13.
A short time after this in 2018, the husband demanded the wife leave the FMH and called the wife a “slut” and a “whore”.[2] The wife agreed to a separation, but sought time for she and the husband to discuss the process so as to minimise the effect the separation would have on the children.
[2] Wife’s affidavit filed 24 June 2022, paragraph 16
At approximately 11.00 pm on a night in mid-2018, the husband went to the room the wife was sleeping in, and woke her. He called her a “filthy slut” and a “bad mother”.[3] The husband was intoxicated and continually insisted the wife leave the FMH immediately. The wife indicated she would not do so and began recording the conversation to protect herself. This recording was subsequently provided by the wife to Victoria Police. After approximately 8 minutes, the husband left the room. As the wife went to put her phone down, the husband ran back into the room, jumped on top of the wife and proceeded to beat the wife whilst pinning her down with his weight. The wife described this further, in her unchallenged evidence as “[Mr Agius] beat me for so long that I fell out of consciousness for a time and genuinely feared that I was going to die.”[4] The wife managed to escape to Mr K’s bedroom, and called the police. Mr K was awake and 15 years old at the time.
[3] Wife’s affidavit filed 24 June 2022, paragraph 22.
[4] Wife’s affidavit filed 24 June 2022, paragraph 22.
The next day 2018, Victoria Police removed the husband from the FMH and charged him with assault upon the wife. The police recorded that the husband physically assaulted the wife causing injuries.
In late 2018, Victoria Police sought an Interim Intervention Order (“IVO”) against the husband on behalf of the wife and children.
Shortly after his removal from the FMH, the husband commenced living at H Street, F Town in the State of Victoria (“the F Town property”). This property is owned by the parties.
In late 2018, the husband entered a guilty plea to one count. The husband also consented to a 12-month final IVO which expired in late 2019. The wife and children were aggrieved family members.
In late 2018, the husband was sentenced and received a fine with no conviction recorded.
At trial, the parenting dispute between the parties had narrowed, as the parties elder son Mr K had become an adult and hence no longer the subject of parenting orders. The child, X, was 14 years old.
Material Relied upon
The husband relied upon:
(1)his Amended Application for Final Orders filed 18 May 2020;
(2)his trial affidavit filed 20 June 2022; and
(3)his Financial Statement filed 20 June 2022.
At the commencement of the hearing, the husband sought leave to rely upon a number of earlier affidavits that he had filed in the proceeding. Leave was granted to the husband to rely on paragraphs [6] – [8] of his affidavit filed 12 June 2019 and sealed 13 June 2019.
Counsel for the wife objected to some of the annexures contained in the husband’s trial affidavit filed 20 June 2022, and at the commencement of the hearing, the following pages and annexures were struck out: the draft affidavit at pages 78 to 84; annexures Q - 2 and Q – 3; and the R Report at pages 235 – 292.
The wife relied upon:
(1)her Amended Response to Final Orders filed 24 June 2022;
(2)her trial affidavit filed 24 June 2022;
(3)her Financial Statement filed 10 May 2022;
(4)her case outline filed 24 June 2022;
(5)Updated Family Report by Dr S filed 24 June 2022 and dated 2 August 2021; and
(6)Family Report by Dr S filed 18 April 2019 and dated 8 March 2019.
At the commencement of the hearing, leave was granted to the wife to also rely upon the affidavit of Mr T filed 12 February 2021 with the Court noting that Mr T was available to be cross-examined by the husband. The husband was familiar with the matters raised by Mr T in his affidavit, and took issue with them.
On the final day of the hearing, on 29 June 2022, the wife sought to rely upon a Further Further Amended Response to an Initiating Application. This document was not filed but handed to the Court outlining property orders sought by the wife and addressed in closing submissions. Those orders sought did not differ significantly from the orders sought during the trial and were not new in the sense of any failure to afford procedural fairness to the husband. They addressed matters which had arisen during the course of the trial.
Family Consultant, Dr S (“Dr S”) was not required for cross-examination by either party and his Family Reports were accepted into evidence unchallenged. The Court accepts this expert evidence and was much assisted by it.
The husband did not seek to cross-examine the wife. The husband was made aware by the Court of the consequences of that election and given an opportunity to re-consider his position. He remained firm in his view. The Court found the wife to be a credible witness whose evidence was not challenged by the husband. The husband was cross-examined by counsel for the wife as to the contents of his affidavit material and other relevant matters.
The standard of proof in this proceeding is the balance of probabilities.[5] Statements of fact in these reasons are findings of fact to that standard of proof.
[5] Evidence Act 1995 (Cth) s 140.
While it is not necessary to comment upon the entirety of the evidence put before me, every piece of evidence relied upon by the parties has been read and carefully considered by me.[6]
[6] Bell & Nahos [2016] FamCAFC 244, [28]; Whisprun Pty Ltd v Dixon (2003) 200 ALR 447, [62].
RELEVANT PROCEDURAL MATTERS
On 7 November 2018, being some two and a half months following separation, consent orders were made for the children to live with the wife and spend time with the husband, including overnight time, on certain dates from 16 November 2018 to 26 January 2019, the longest period of time being eight nights during the long Christmas school holidays, and otherwise being between two and six nights.
On 12 March 2019, consent orders were made for the children to spend time with the husband up to 14 July 2019. That time included after school time and some overnight time. Further consent orders were made for the parties to attend non-reportable counselling and share the cost.
On 17 June 2019, the Court made property orders, relevantly, that:
4.Pursuant to s 114 of the Family Law Act 1975 (Cth) and until further order the wife shall have sole use and occupation of the property at [J Street], [Suburb L] (“[Suburb L]”).
5.The wife shall make the following payments totalling $90,000 by way of part property settlement to the husband’s solicitors trust account being [U Trust Account]:
a. The sum of $30,000 on or before 15 July 2019;
b. The further sum of $30,000 on or before 15 August 2019; and
c. The further sum of $30,000 on or before 15 September 2019.
6.From the date of these orders and until further order, within seven (7) days of the payment by or on behalf of the wife of any money in payment of accounts rendered by her solicitors for legal fees including disbursements (but excluding any joint disbursement) the wife pay or cause to be paid the sum (sic) amount to the husband’s solicitors.
….
11.Until further order the wife pay or cause to be paid as and when they fall due all mortgage payments to:
a.The Australian and New Zealand Banks Group in respect of the [Suburb L] property; and
b.[G Bank] in respect of the property situate at [H Street], [F Town].
On 19 November 2019, orders were made by consent for Mr K to spend time and communicate with the husband as agreed between the parties and in accordance with Mr K’s wishes. The consent orders further provided for X to spend time and communicate with the husband each alternate week during school terms between Friday to Sunday, each Wednesday until 7.00pm, half school holidays and on special occasions.
On 18 June 2020, the Court made property orders, relevantly, that the parties do all acts and things necessary to appoint V Company as a single expert valuer of the business operated by W Pty Ltd, with such report to be released by no later than 12 March 2021 and Y Property Group as a single expert to value the FMH and the F Town property.
On 4 December 2020, it was ordered by consent that the wife pay the husband a further $45,000 by way of part-property settlement.
On 16 February 2021, the Court ordered the wife to pay $25,000 by way of litigation funding to the husband’s solicitors. Further orders were made including for the business operated by W Pty Ltd to be sold, and for the FMH to be sold with the proceeds of sale to be applied as follows:
6. Upon settlement of the sale of [Suburb L], the proceeds be applied as follows:
(a) first, in payment of all costs and commissions of the sale;
(b) secondly, to discharge the following loans:
(i) ANZ Business Mortgage Account (no. ending […72]);
(ii)ANZ Business Loan Account (no. ending […81]) the balance of $136,071 is owed at 31 December 2020; and
(iii)any balance owed in reference to the ANZ overdraft facility Account (no. ending […23]) as at the date the settlement; (collectively the “ANZ loans”);
(c) thirdly, by way of partial property settlement:
(i)the sum of $200,000 to the wife less any monies paid by or on behalf of the wife to Berger Kordos or such other solicitors as she may instruct in relation to these proceedings (whether in payment of invoices rendered or into trust) in the period between 12 February 2021 and the settlement of the sale of [Suburb L]; and
(ii)the sum of $200,000 to the husband less any monies received by or on behalf of the husband pursuant to the litigation funding order, including the payment pursuant to paragraph 1 hereof, in the period between 12 February 2021 and the settlement of the sale of [Suburb L];
(d)fourthly, in payment to the wife such sum as is required to reimburse the wife for the costs paid by her pursuant to paragraphs 4(c) and 9 hereof;
(e)finally, the remaining balance thereafter be paid into an interest-bearing account operated by the husband’s solicitors in trust for the husband and wife jointly pending further written agreement between the parties or further order of the Court.
7.Upon the settlement of the sale of [Suburb L], the litigation funding order be discharged.
9.The parties do all acts and things and sign all documents as required to engage the appointed single expert, [Y Property Group], to prepare an updated sworn valuation as to the market value of the real property situate at and known as [ H Street], [F Town] in the State of Victoria with the wife to pay the cost of same in the first instance.
On 12 May 2022, property orders were made, relevantly, for the parties to sell the shareholding owned by E Pty Ltd SMSF, the parties self-managed superannuation fund (“the SMSF”), and apply the net proceeds of sale, together with any funds in the offset account, to the mortgage …secured over the F Town property; and for the husband to be otherwise responsible for all payments on the mortgage … pending the final hearing. This order released the wife from her obligation to pay the mortgage in respect of the F Town property, which had existed since 17 June 2019 (almost three years). Orders were made for ‘YY Company’ to then be appointed as the single expert to value the F Town property; for the husband to obtain advice as to rental revenues due to the SMSF and penalties arising out of his occupation of the F Town Property and advise the wife of such; and for the matter to be listed for final hearing on 28 June 2022.
On 16 June 2022, Z Lawyers Pty Ltd and C Lawyers Family Lawyers (“the intervenors”), being the husband’s former solicitors, were joined to the proceeding as intervenors. There were long standing costs owed by the husband to that firm. Orders were made preventing the parties from entering into consent orders or a Binding Financial Agreement without informing the interveners, and for any property received by the husband to be paid in the first instance to the trust account of C Lawyers Family Lawyers in the sum of $25,440.13. The intervenors participation was not required nor sought for the final hearing.
On 29 June 2022, the Court, at the final hearing, made orders by consent that the mother and father have equal shared parental responsibility for the child X. The outstanding issues as to parenting orders were with whom X should live, what school he would attend, and what spend time and communication X would have with the other parent.
Parenting
Legal Principles
Section 60CA of the Act provides that:-
In deciding whether to make a particular parenting order in relation to a child, a court must regard the best interests of the child as the paramount consideration.
Pursuant to s 60CC(1) of the Act:-
…in determining what is in the child’s best interests, the court must consider the matters set out in subsections (2) and (3).
Those primary considerations contained in s 60CC(2) of the Act and additional considerations contained in s 60CC(3) of the Act are set out hereafter.
Section 60CC is contained within Pt VII of the Act. The objects of Pt VII of the Act are set out in s 60B(1) of the Act, and are to ensure that the best interests of children are met by:
(a)ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child; and
(b)protecting children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence; and
(c)ensuring that children receive adequate and proper parenting to help them achieve their full potential; and
(d)ensuring that parents fulfil their duties, and meet their responsibilities, concerning the care, welfare and development of their children.
Section 61DA of the Act requires the Court to apply a presumption that it is in the best interests of the child for the child’s parents to have equal shared parental responsibility for the child. The parties agreed at the conclusion of the trial to equal shared parental responsibility of X. Accordingly, the Court must consider whether it is in the child’s best interests and reasonably practical for X to spend equal time with each parent or, if not equal time, whether it is in the child’s best interests and reasonably practical for him to spend substantial and significant time with each parent.
Pursuant to ss 60CC(2) and 60CC(2A) of the Act:
(2) The primary considerations are:
(a)the benefit to the child of having a meaningful relationship with both of the child's parents; and
(b)the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence.
Note: Making these considerations the primary ones is consistent with the objects of this Part set out in paragraphs 60B(1)(a) and (b).
(2A)In applying the considerations set out in subsection (2), the court is to give greater weight to the consideration set out in paragraph (2)(b).
“Family violence” is defined in s 4AB of the Act and is as follows:
(1)For the purposes of this Act, family violence means violent, threatening or other behaviour by a person that coerces or controls a member of the person's family (the family member ), or causes the family member to be fearful.
The Court must also consider the additional considerations under s 60CC(3) of the Act, as far as they are relevant to this proceeding.
In Mulvany & Lane (2009) FLC 93-404 it was observed by Finn, May and Thackray JJ that:
76. It is important to recognise that the miscellany of "considerations" contained in ss 60CC(2) and (3) is no more than a means to an end. Self-evidently, they are only matters to be considered. Of course, we accept they are of great importance, being the factors identified by Parliament as those the Court must take into account (when they are relevant). However, they must be applied in a manner consistent with the overarching imperative of securing the outcome most likely to promote the child's best interests.
77. It needs also to be remembered that the importance of each s 60CC factor will vary from case to case…
Whilst the additional considerations as set out in s 60CC(3) must be considered by the Court, specific reference to each and every of those considerations is unnecessary in these reasons.[7]
[7] Mulvany & Lane (2009) FLC 93-404 at [77].
Proposed Parenting Orders
I shall refer to the parties as the child’s father and mother (not husband and wife) for the purposes of my consideration of what parenting orders are in X’s best interests.
The mother sought final parenting orders that X live with her in her rental property at WW Street in Suburb XX, and spend each alternate weekend with the father from the conclusion of school Friday (or 4.00pm) until 6.00pm on Sunday with such time to be extended to 6.00pm Monday if the Monday is a non-school day. She otherwise sought that X spend half school holidays and other special occasion days with the father together with an ability for X to communicate with his father regularly. The mother sought no change to the school at which X attended.
The father sought final parenting orders that X live with him in F Town or City AA. The father indicated at the conclusion of the trial that it would likely be City AA. The father had no concrete accommodation proposed in either place. If X was to live with the mother, the father sought that X spend time with him each alternate weekend from Friday to the commencement of school Monday in week one, and from the conclusion of school Tuesday to the commencement of school Wednesday in week two. He also sought half school holidays and other special occasion days. The father sought a change to X’s schooling from his current school, BB School, proposing that X attend either CC School in F Town, DD School in EE Town, or FF School in City AA, this last school being suggested at trial by the father, as the father’s new partner is living in City AA. No evidence pertaining to any of these schools was before the Court.
Both parties in the orders sought by each of them, recognised that given their geographical distance from each other’s residence, it was not in the child’s best interests and reasonably practical for X to spend equal time with each of his parents. Both parties instead sought orders for substantial and significant time to be spent with the non-resident parent. On the facts of the case, the parties’ orders as sought were proper.
Primary Considerations
The father alleged that X is at risk of harm in the household of the mother, that risk being from Mr K. The mother does not propose to remove Mr K from her household. It is common ground between the parties that Mr K’s behaviour has been challenging for his parents, in particular the mother, as the father has not spent any time with Mr K in over three years. The father provided no assistance to the mother in her attempts to address, beneficially for all, the various issues present for Mr K. Mr K has experienced drug addiction and engaged in antisocial and reckless behaviours such as “stealing a vehicle and having an accident [at] one point.”[8] His behaviours have resulted in police attending the mother’s residence on a number occasions. It is accepted by the mother that X has witnessed Mr K be violent toward the mother, and that X is acutely aware of his brother’s difficulties and alcohol abuse.
[8] Family Report dated 2 August 2021, paragraph 13.
It was the mother’s unchallenged evidence that Mr K’s escalation in behavioural issues spiked following the parties separation. Mr K witnessed the aftermath of the altercation between his parents, including injuries sustained by his mother and the police attending the FMH, as described in paragraphs [13] and [14] of these reasons. Mr K reported to Dr S that the reason he did not wish to spend time with the father was because the father was “unapologetic for [his] past failings and refuses to apologise”.[9]
[9] Family Report dated 2 August 2021, paragraph 32.
X, in his interview with Dr S in August 2021, described the situation with Mr K as follows:[10]
… the situation for his brother had improved noticeably within the household in more recent times. He agreed that there have been significant challenges with [Mr K's] behaviour, including aggressive outbursts, alcohol use, and a generally unpredictable and labile presentation. He described, "it's better than before because now he doesn't have alcohol, he says, I hope that's true, which I think it is… He's a […] now”. While he understood that there had been violence perpetrated against his mother by his older brother, [X] maintained that, "I wasn't there… Wait, I was there, but I was asleep”. He said he had witnessed the police attend the home at one stage, taking his brother away.
[10] Family Report dated 2 August 2021, paragraph 25.
It was the mother’s evidence that “[X] and [Mr K] love each other and they both want to live in the same house together”.[11] While “there were some issues at the time of separation”, those issues had since resolved with the assistance of a family therapist and other interventions that had occurred mostly as arranged by the mother. In respect of Mr K’s health and behaviour, Mr K, having in the view of Dr S “rejected his father entirely”,[12] has not interacted with the father in over three and a half years and the father has no real knowledge of the existing relationship and interactions between the two brothers and/or between the mother and the parties’ children.
[11] Wife’s affidavit filed 24 June 2022, paragraph 41.
[12] Family Report dated 2 August 2021, paragraph 32.
The evidence of Dr S was that X is not negatively influenced by his brother’s behaviour. Instead, his brother’s behaviour has had an “inverse effect” whereby X focuses “on his diet, on his health, on his sport” and has reported to his mother that “he will never drink a drop of alcohol until his brain stops forming at 27 [and that] he will never smoke”.[13] Dr S’ further evidence was that X “does not appear to be significantly impacted by some of the events that have occurred, or present with the same degree of emotional vulnerability or psychological disturbance inherent in his older brother”.[14]
[13] Family Report dated 2 August 2021, paragraph 14.
[14] Family Report dated 2 August 2021, paragraph 36.
At trial, Mr K was attending upon a private counsellor. The mother had been liaising with the police and was continuing to take a number of active and positive steps to improve Mr K’s behaviour.
I am satisfied that the mother has taken all necessary and appropriate steps to protect X from any negative impact as a consequence of any behaviours of Mr K. I am further satisfied that Mr K poses no unacceptable risk of harm to X.
As referred to in paragraphs [10], [12] – [14] of these reasons, there has been significant family violence between the parties. The children “are aware that there was a violent confrontation in August 2018” and demonstrate that they are aware of the ongoing conflict and legal proceedings between the parties,[15] as stated by Dr S in August 2021 (Mr K was 17 years old). The effect this has had on X at the time of the updated Family Report was described by Dr S as follows:[16]
I believe he experiences a very real sense of divided loyalties. Internal conflict. That he probably feels the need to inhibit discussion or reference to his time with one parent for fear of upsetting the other.
In terms of relations between his parents, he understood that the situation remained tense. He remarked, "they are not happy, because they do not like each other at all. Because mum thinks that dad doesn't have a job, but that's not true, he has lots of jobs… That's one thing”. He said that his father was more inclined to denigrate his mother openly, often saying unfavourable things about her, including that "she stolen $3 million from the company, and the company, [W Pty Ltd], went into liquidation, I don't know how many days ago, I forgot”.
[15] Family Report dated 2 August 2021, paragraph 3b.
[16] Family Report dated 2 August 2021, paragraphs 3b, 27.
I find the father lacks insight into the impact upon the mother and children of the family violence perpetrated by him upon her in 2018. As said by Dr S in his first Family Report filed 18 April 2019, the husband “demonstrated a tendency to minimise events which reflected unfavourably upon him” and further that the husband “does not present as particularly insightful nor emotionally aware.” Rather, the husband lied to the children about what occurred at the point of separation between the parties, saying to them that the mother made up the assault and has stolen millions of dollars from the family business.
There is, however, no current need to protect X from being exposed to family violence. The significant episode which occurred, was in excess of four years ago. There have been no further instances of the child being exposed to family violence and the parties agree that there is great benefit to X in having a meaningful relationship with each of his parents, and the wife, in particular, supports X’s meaningful relationship with his father.
Additional Considerations
Section 60CC(3)(a) any views expressed by the child
X is 14 years of age, turning 15 in 2022. He was described by Dr S as “a physically well-developed child, albeit naive and emotionally underdeveloped. Features of an autism spectrum condition were evident immediately from his manner of interaction (e.g., poor eye contact, literal interpretation, social awkwardness).”[17]
[17] Family Report dated 2 August 2021, paragraph 25.
In his 2021 interview with Dr S, X expressed that:[18]
… he was open to moving to the country. He remarked, "I like the country, it's not stressful. You don't feel angry all the time, you feel relaxed, if you like you're on top of the world". He continued, "you also get better sleep, because of the country air. There is no pollution, and you can see the stars at night". He said that he was more in favour of relocating to live in [F Town], than he was to staying in Melbourne. When asked to explain his rationale, acknowledging that he would miss his mother and brother, [X] struggled to provide any coherent exploration, and understated any potential challenges that may ensue as a result of having to change schools, being removed from his current friendship group, and potentially having less access to his normal interests, such as shotput coaching. At that point, [X] was asked whether anyone had talked to him about what to say during the consultation, to which he replied that his father had spoken to him at great length about the benefits of relocating, and how this may be framed when asked by people outside of the family. He recalled his father stating, "it would be better if you were in [DD School] because it's a lot better for you, you've got so much space to roam around lunchtime, and I spoke to the teachers and they really like you and the students are going to be really good there, the (sic) are going to really like you”. He continued by describing his father as stating “you will do better here, you will be treated better here, will have a better life, and your close (sic) always washed, but he was saying that's my opinion, it's not my choice it's your choice, so you can make it”.
[18] Family Report dated 2 August 2021, paragraph 26.
Dr S observed that “the undeniable reality is that both of these children are extremely aware of the disunity between their parents...these children are not presented with a united front…for X especially this reality is upsetting.”[19]
[19] Family Report dated 2 August 2021, paragraph 3b.
It was the opinion of Dr S that X has “understated any potential challenges which might arise from changing schools, being removed from his current friendship group and having less access to his normal interests such as sports coaching”.[20]
[20] Family Report dated 2 August 2021, paragraph 26.
As discussed at [65], Dr S’ evidence was that that there had been a degree of influence and manipulation by the father when talking to X about X living in F Town, and his mother “stealing money from the family business”.[21]
[21] Family Report dated 2 August 2021, paragraph 33.
In the circumstances as described above, I find little weight can be afforded to X’s views.
Section 60CC(3)(b)the nature of the relationship of the child with each of the child’s parents and other persons
X has a positive and loving relationship with both of his parents. Both were actively involved in his care in his infancy, the mother taking X to work with her until he was 11 months old. X enjoys spending time with the father and demonstrates compassion toward him. His primary attachment, however, is to the mother. He has lived with the mother for the last four years, and is accustomed to her routine and care practices.[22]
[22] Family Report dated 2 August 2021, paragraph 33.
Both X and Mr K respond well to the mother. She was described by Dr S as an attuned, engaged and loving parent, and there was little evidence of her minimal involvement, as alleged by the father, in the children’s upbringing due to her work hours and travel requirements.[23]
[23] Family Report dated 2 August 2021, paragraph 3d.
X has a loving and close relationship with his brother. X is clearly aware that Mr K does not have any interaction or communication with the father, and has not done so for more than three years.[24]
Section 60CC(3)(c)-(ca) the parents’ opportunity to participate in decision making, spend time and communicate with the child and the fulfilment of the parents’ obligations to maintain the children
[24] Family Report dated 2 August 2021, paragraph 29.
Both parties spend regular time, and communicate with X, and have done so since separation.
It is common ground that the communication between the parties’ is poor. Dr S reported that although occasionally the mother sent text messages to the father in relation to the children (as they both then were), since separation the mother has been responsible for all decisions involving the children.[25]
[25] Family Report dated 2 August 2021, paragraph 4.
Dr S found the parties to have quite entrenched views of one another and noted that both parents made clear at that time that they would never collaborate to any significant degree in relation to the children or work together in any functional manner.[26]
[26] Family Report dated 2 August 2021, paragraph 30.
It was the mother’s evidence that co-parenting would be difficult with the father. The mother’s evidence was that she was “pretty much a solo parent [to] [X]”. She had made a number of efforts to try and include the father in decisions affecting the children, but the father was “unresponsive in terms of basic things” such as getting a shot put coach or ascertaining [X’s] homework schedule.[27]
[27] Family Report dated 2 August 2021, paragraph 15.
The father has chosen to have little to no involvement in the parental decision making in respect of matters pertaining to X for the past four years, and nor has he been involved in any decision making with respect to Mr K for four years.
Despite these difficulties as described above, and as stated by Dr S in 2021, the parties agreed at trial to have equal shared parental responsibility for X. This attempt at a united front can only benefit X so long as it is effective. The parties acknowledged their interaction difficulties but wished to pursue such a path. Accordingly, a consent order was made to that effect.
It is not disputed by the father that he has not paid child support to the mother for the support of either child (including Mr K prior to him becoming an adult). The mother has had greater financial capacity than the father, and has provided almost exclusively for the children’s financial needs.
Section 60CC(3)(d) the likely effect of any changes in the child’s circumstances
It was the father’s evidence at trial that he may live in City AA with his new partner, Ms GG, aged 42 years, and her two children, HH aged 16 years, and JJ aged 14 years. The husband, however, could not indicate with any certainty when he would move out of the F Town property and move to City AA, or whether he would live with his new partner, as he suggested, or in public housing.
Any change in X’s residence would be significant, and the likely impact, adverse. At trial, X had only recently moved schools, from KK School due to being “unfairly treated”,[28] and was settling well into Year 9 at BB School. It was the father’s evidence that X is struggling at school, specifically with concentration, arriving punctually to class, having sufficient materials and being prepared.[29] It was the mother’s unchallenged evidence that it was only recently that X had become more adjusted to the school setting and academia.[30] When cross-examined by the mother’s counsel, the husband conceded that X had settled in “pretty well at the school…and found his feet”,[31] but later, in contradictory evidence, stated he did not think that X “has ever settled”.[32] At trial X was playing sport, and was involved in local sporting clubs. The school reports corroborate that X has a high degree of participation, is learning how to make friends and become connected, and enjoying his new peer groups. A change in residency for X, to F Town and/or City AA would have X move over 100 kilometres from the mother’s residence, and remove him from the primary care of the mother, and the company of his brother. He would undergo a further change in school, and have an inability to continue his involvement with his current sporting teams.
[28] Transcript 28 June 2022, p.73 line 1.
[29] Husband’s affidavit filed 28 June 2021, paragraph 29.
[30] Family Report dated 2 August 2021, paragraph 16.
[31] Transcript 28 June 2022, p.73 lines 8-12.
[32] Transcript 28 June 2022, p.75 line 21.
Both children have been diagnosed with high functioning ASD.[33] Dr S opined that X required structure, routine and predictability in his life, which would be upended if he were to relocate as proposed by his father.[34] Further, it was Dr S’ evidence that X may struggle in adjusting to another new school, making friends, relying on his father for transport and being separated from his mother and brother.[35] Mr K expressed to Dr S that he does not believe X would cope with moving permanently to the country and being removed from his usual environment, school and friendship group.[36]
[33] Family Report dated 2 August 2021, paragraph 2.9.
[34] Family Report dated 2 August 2021, paragraph 37.
[35] Family Report dated 2 August 2021, paragraph 37.
[36] Family Report dated 2 August 2021, paragraph 24.
Dr S considered that X may have an idealised view of life in the country with his father, given the lack of routine, homework and structure, and abundance of enjoyable activities and relaxation, in contrast to the city. [37] It was Dr S’ assessment that it is in X’s best interests that he does not change his residence, which would separate him from his mother and brother, but rather that he continue to spend time with his father to continue the positive relationship he has with his father.[38]
Section 60CC(3)(e) the practical difficulty and expense of a child spending time with and communicating with a parent and whether that difficulty or expense will substantially affect the child’s right to maintain personal relations and direct contact with both parents on a regular basis
[37] Family Report dated 2 August 2021, paragraph 37.
[38] Family Report dated 2 August 2021, paragraph 37.
The geographical constraints of the father’s location in the country and the mother’s location in the city imposes considerable travel time for X between Melbourne and F Town and now, possibly City AA. The father has been solely responsible for travelling to and from Melbourne to collect and return X.[39]
[39] Husband’s affidavit filed 20 June 2022, paragraph 94.
At trial, the father conceded he would have saved himself extensive travel time if he was living in Melbourne, however has no intention of returning to Melbourne.[40]
[40] Transcript 29 June 2022, p.102, line 13.
It was the evidence of Dr S that the substantial geographic distance between the two parties meant an arrangement of equal shared care through a week about arrangement may not be reasonably practicable.[41] Any such arrangement was, in the opinion of Dr S, entirely inappropriate and contrary to the need for both children to remain together.[42] I am satisfied that it would not be practical for X to spend equal time with each parent. Further, this is a parenting arrangement that both parties concede is not feasible nor in the child’s best interests as earlier referred to by me.
[41] Family Report dated 2 August 2021, paragraph 3i.
[42] Family Report dated 2 August 2021, paragraph 3i.
X’s right to maintain his meaningful relationship with both parents on a regular basis is facilitated by his parents in each of their proposals to the Court.
Section 60CC(3)(f) the capacity of each of the child’s parents; and any other person (including any grandparent or other relative of the child) to provide for the needs of the child, including emotional and intellectual needs
The mother has been the primary carer for the children for four years. In this time, Mr K’s behaviours have improved, and X’s performance at school has improved.[43]
[43] Family Report dated 2 August 2021, paragraph 7.
The mother’s capacity to provide for the physical, emotional, intellectual and financial needs of the child X, I find, exceeds that of the father. She is more child focused, has a greater understand of his needs, and a preparedness to attend to them.
During the father’s interview for the Updated Family Report, the father was observed by Dr S to be “more focused on the failings of the mother, rather than what arrangements worked best for the children”. [44] It was Dr S’ evidence that the father struggled with self-reflection and his assessment of the behaviour, attitude and mental health of the children was cursory.[45]
[44] Family Report dated 2 August 2021, paragraph 17.
[45] Family Report dated 2 August 2021, paragraph 17.
The father has provided little credit to the mother’s role in the children’s lives. At trial, the father stated the mother only contributed a small amount to the children’s upbringing aside from giving birth to the children. I find this to be an inaccurate description of the mother’s contribution toward the advancement of the children’s welfare and a poor reflection on the father’s capacity for insight.
Section 60CC(3)(g) the maturity, sex, lifestyle (including lifestyle, culture and traditions) of the child and of either of the child’s parents, and any other characteristics of the child that the court thinks are relevant
The characteristics of X are described elsewhere within these reasons. It was otherwise the evidence of Dr S that X was not assessed to have the same degree of emotional vulnerability or psychological disturbance as Mr K. Although X has had some issues with academic achievement and social problems with his peers, this was not assessed by Dr S to be unusual given his developmental disorder; being a child of separated parents; Mr K’s errant behaviour; and physical characteristics (large in stature), that would render him potentially a target.[46]
Section 60CC(3)(i) the attitude to the child and to the responsibilities of parenthood, demonstrated by each of the child’s parents
[46] Family Report dated 2 August 2021, paragraph 36.
Both parties love X and are loved by him. Both acknowledge this to be the case.
The mother has had to adapt her parenting style to meet the challenges of both X and Mr K. When Dr S first engaged with the parties, the mother employed a harm minimisation approach to parenting, specifically with regard to Mr K whereby she allowed him to continue to use a prohibited substance.[47] Since that time, the mother has adopted a zero tolerance policy toward Mr K in the home in relation to his behaviour, alcohol and drug use, and has engaged a case manager and counsellor for Mr K.[48] The mother has continued to liaise with police, and taken a number of other steps to improve Mr K’s behaviour. I am satisfied that these changes within the household that work to address Mr K’s behaviour, significantly benefit X. Additionally, such actions of the mother, and support provided by her, demonstrate the mother’s capability as a parent to both X and Mr K. That same capability is exhibited in the mother’s support of the relationship between X and his father.
[47] Family Report dated 2 August 2021, paragraph 35.
[48] Family Report dated 2 August 2021, paragraph 35.
The father has always adopted a zero tolerance approach to parenting and provided adequate supervision and decision-making in relation to the children.[49] While the children may “have benefitted from the level of structure and input [the father] has had in their lives over the years”,[50] the father’s relationship with Mr K is now non-existent, and his time with X since separation has been both beneficial, and at times problematic. His denigration of the mother to X and his attempt to manipulate the child’s views are examples of problematic interaction.
[49] Family Report dated 2 August 2021, paragraph 3g.
[50] Family Report dated 2 August 2021, paragraph 3g.
Section 60CC(3)(j) and (k) family violence
It was assessed by Dr S that X is not at any acute risk of physical or psychological harm whilst in the care of his father.[51]
[51] Family Report dated 2 August 2021, paragraph 34.
Since separation there have been no further instances of aggressive behaviour by either parties including at changeover and instances when both parents have jointly attended the same event relating to the children.[52]
[52] Family Report dated 2 August 2021, paragraph 34.
Otherwise, family violence has been considered as set out in these reasons above.
Section 60CC(3)(l) whether it would be preferable to make the order that would be least likely to lead to further litigation in relation to the child
It was the mother’s evidence that the ongoing litigation is a contributing factor to the ongoing conflict between the parties.
The father demonstrated a lack of insight into his own actions against the mother, and how a change in residency would affect X. I find the father also lacks insight into X’s mental health and wellbeing, and in particular fails to acknowledge that his attitude toward Mr K affects both Mr K and X. The mother accepts that it is important for X to maintain a relationship with the father, and supports the father’s regular involvement in X’s life. An order for X to remain in the mother’s care will be less likely to lead to further litigation.
Conclusion
I am satisfied that it is in X’s best interests to remain at his current school and live with the mother. I accept the evidence of Dr S that X, with autism, is “a boy that needs a structure and routine and predictability in his life, which would be upended were he to relocate.”[53] The mother’s proposals as to spend time arrangements during the school week are generally preferable to the father’s as they are more practical and better promote X’s best interests, in particular, should the father move his residence to City AA, a distance of more than 100 kilometres from Melbourne. There should be, however, an opportunity for X to spend time each week with the father including in the alternate week, should the father travel to Melbourne. Accordingly, I shall make an order to that effect. The balance of the orders I shall make provide for holiday and special occasion time together with regular communication between X and his parents. Overnight time during school terms as proposed by the father in the alternate week would be too difficult and disruptive for X who would need to travel from City AA, to Suburb ZZ, before school on a Wednesday having made the trip from Melbourne to City AA on the evening before following a school day. That would be an exhausting period for X, with his particular needs, and disruptive to his routines. Accordingly, the mother’s proposal better advance X’s best interests.
Property
Further Relevant Background
[53] Family Report dated 2 August 2021, paragraph 37.
Funds obtained by the husband
In early 2018, the husband transferred $100,000 to a bank account in the name of Agius Investment Trust. That account was controlled by the husband. The husband did not make adequate discovery of this transfer. The husband, at trial, maintained the money so transferred was expended in full and applied to improve the F Town property, and was “recorded in the books”.[54] He later conceded this amount had not been recorded, claiming the taxation return for that financial year remained outstanding. There is no documentary corroborative evidence to support the husband’s claim that he applied the funds in their totality, or at all, in the manner described by him. However, I can be satisfied, on the wife’s concession that the husband was responsible for organising some renovations to the F Town property. The wife did not know the quantum the husband was spending on the renovations, which were to be minor in nature, a matter which the husband ignored. The wife claimed that the husband initially sold shares owned by the SMSF to fund the renovations, and when this was not sufficient, the husband assumed W Pty Ltd would fund the balance of the renovations. The wife did not agree to the husband paying for renovations to the F Town property from the W Pty Ltd accounts. The further monies the husband obtained (see [105] below) may have been also applied to the F Town property by the husband, but I can make no finding as to that when applying the necessary standard of proof.
[54] Transcript 29 June 2022, p.109 lines 29-34.
In July 2018, the husband had available to him in his personal account, the sum of $17,305.77. He provided no disclosure as to his application of those funds.
Following separation and in 2019, the husband received a taxation refund of $10,235 in respect of the previous financial year. He did not disclose to the wife his receipt of these funds as he believed such funds were his to keep.[55]
[55] Transcript 29 June 2022, p.111 lines 5-25.
On 28 August 2018, being around the time of separation, the wife discovered the husband had made an unauthorised withdrawal in the sum of $24,280.75 from the parties W Pty Ltd business account with the ANZ Bank. The wife subsequently wrote to the bank to prevent the husband from having further access to the account without her authority. However, on 29 August 2018, the husband withdrew a further $23,502.40 from the business account. Thereafter, he discovered he had no further ability to unilaterally withdraw additional funds. The husband had taken a total sum of $47,783.15 from the parties business account, placing the business in a difficult position with respect to the payment of the outstanding liabilities of the business, including in particular taxation payments due.
The above monies totalled $175,323.92.
W Pty Ltd
The wife was the sole director of W Pty Ltd, which was a business established by the wife in 1998. The parties were equal shareholders in the company. W Pty Ltd was the corporate trustee of the Agius Family Trust of which the husband, wife and children were beneficiaries.
The husband was employed by W Pty Ltd in a part-time capacity, commencing in approximately 2010, to assist with the development of the IT infrastructure, liaise with landlord agents and attend to bill payments. The wife’s unchallenged evidence was that this employment was to engage the husband in circumstances where he could not obtain, or retain, employment elsewhere. His history of employment was sporadic, although I accept that the husband made additional contributions during the course of the marriage through his undertaking of renovation tasks. During these years, the parties employed, at not insignificant expense, an array of carers and other support persons to assist in the operations of their household.
The wife’s unchallenged evidence was that both parties did not draw official wages until the 2017-2018 financial year, whereupon the wife’s wages were paid into the parties’ bills account until separation, whilst the husband’s wages were paid into his personal ANZ account. The house insurance, income and life insurance, and other assorted expenses which needed to be paid (if there were not sufficient funds in the bills account) were paid from the W Pty Ltd account.[56]
[56] Wife’s affidavit filed 24 June 2022, paragraph 137.
The husband’s employment with W Pty Ltd continued until after the family violence incident in mid-2018, when the husband’s employment ceased and he was paid a termination sum of $8,347.50.
W Pty Ltd provided the wife with income, at separation in late 2018, of $159,796 gross per annum. Between separation in August 2018 and 2021, the business however suffered financial decline.
Whilst the husband contended the pandemic did not adversely affect the business, without any real evidence to support that contention, I find on the evidence before the Court that in large part the decline in the fortunes of the business was due to the COVID-19 pandemic of 2020 and 2021.
Prior to W Pty Ltd’s liquidation in mid-2021, and in late 2019, the company had been valued at $1,368,000. Pursuant to orders made by the Court on 16 February 2021, the wife attempted to sell the business, however, she received only two offers. One offer was in the sum of $50,000, made mid-2021 by Mr LL (“Mr LL”). This offer was rejected by the husband. The second offer was in the sum of $650,000, also made in mid2021 by Mr MM. $10,000 would be paid “upfront for a review of the IP and business” with a further $640,000 to be paid if the business met the purchaser’s “needs” in three months time. What those needs were was unclear to the wife. The wife rejected the prospective purchaser’s offer as she considered it to be a “fishing” exercise.
In mid-2021, the wife’s solicitors contacted the husband’s solicitors indicating that the wife thought it necessary to place W Pty Ltd and the Agius Family Trust into voluntary administration. The husband disagreed.
In mid-2021, the wife placed W Pty Ltd into voluntary administration on advice received by her from Mr T (“Mr T”) of NN Company.
W Pty Ltd had engaged Mr T as a corporate advisory consultant to provide insolvency and commercial advice, specifically whether the business would be viable, and survive the COVID-19 pandemic. Mr T had worked as a corporate advisory consultant for 30 years, holding a background in chartered accounting and various degrees in business. He was previously a partner at OO Pty Ltd in AA State, amongst other positons and achievements going to his expertise.
At trial, Mr T was cross-examined by the husband. Mr T’s affidavit evidence was not disturbed by that cross-examination, and the Court accepts the evidence of Mr T, included that tendered. The wife had engaged Mr T to “drill down and work through the safe harbour provisions of the Corporations Act, effectively provide some advice as to the likely outcomes [as to] how she could protect herself, and also maximise the value of the company first to creditors in the event that it might be insolvent, and then to shareholders if it was not insolvent”.[57]
[57] Transcript 29 June 2022, p.87 lines 10-15.
Following the expert input of Mr T, the wife placed W Pty Ltd in liquidation in mid-2021. The decision to place W Pty Ltd in liquidation was inevitable both on the wife’s evidence and that of Mr T, and that evidence is accepted by the Court. The husband’s contention that the wife stripped the company of its value, and set up another company with the same client base, is not supported by the evidence. The liquidation of the company has been a financial blow to the parties, and the wife has borne the brunt of that liquidation.
The wife has significant debt owing to the Australian Taxation Office (“ATO”) as does the parties corporate entity, D Pty Ltd (“D Pty Ltd”). The wife is the director and sole shareholder of D Pty Ltd. The wife owes to the ATO in her personal name an amount of $235,018.64 and in the name of D Pty Ltd an amount of $238,972.94.
It was the wife’s evidence that due to the structure of W Pty Ltd and the Agius Family Trust distributions needed to be made to the husband and wife to avoid significant tax consequences being incurred if the trust retained the earnings. The husband refused to accept a distribution from the trust after separation, which resulted in the entirety of the distribution being made to the wife as the beneficiary in default.[58] This caused a significant taxation burden to the wife solely.
[58] Wife’s affidavit filed 24 June 2022, paragraph 138.
Additionally, as a result of the Agius Family Trust’s inability to repay its loan from W Pty Ltd, W Pty Ltd was forced to forgive the debt owed to it by the Agius Family Trust. This had significant tax consequences for the wife. The wife had control over both entities, thus the entities were “associated”. As such, the forgiving of the loan from one entity to the other gave rise to a deemed dividend in the amount of the forgiven loan. This deemed dividend was entirely unfranked and had to be apportioned to one of the beneficiaries of the trust (failing which it would have been assessed at the highest tax rate as undistributed income in the hands of the trust).
The wife’s combined taxation liability is currently $473,991.58 plus accrued interest. The amount is expected to increase by approximately $400,000 due to the wife’s income tax returns for the financial years 2020 and 2021. Although the wife has lodged an outstanding application for discretion to the Commissioner of Taxation. The wife sought that the taxation liability of the wife in the name of D Pty Ltd, should be borne equally between the parties. The wife further sought that in circumstances where the husband has benefitted from the income received by her (including post-separation), the husband should also be responsible for the taxation consequence of such income. The wife sought the Court should apportion this taxation debt equally between the husband and herself.
Other
It was common ground between the parties that the husband is the sole director and shareholder of Agius Family Investments Pty Ltdd (“Agius Family”). It was agreed between the parties that the company shall remain with the husband, noting it has a nil value. Likewise, the corporate entities owned by the wife should remain her property.
The husband at the commencement of the trial sought to retain for himself the equity in the F Town property; his motor vehicle; the corporate entity Agius Family; the SMSF in the event the SMSF is not wound up; and no debt. The husband moved his position somewhat during the trial proposing that the equity in the F Town property be divided equally between the parties, and agreeing to payment by him of the approximate $63,000 penalty owed to the Australian Taxation Office in respect of his illegal occupation of the F Town property. I note that he vacillated as to this payment by him, but ultimately conceded that he should pay this sum whether the F Town property is transferred to him within the SMSF or not. The husband also agreed, during the trial, for the liquidators’ costs to be paid equally by the parties and from the monies held in trust on behalf of the parties. Likewise, any payment arising from the liquidation would be made to the parties equally.
Since the commencement of the litigation, the husband has received a total of $182,439 by way of litigation funding pursuant to the orders made 17 June 2019 and 16 February 2021. The husband has received a total part-property settlement advance of $302,906.25 pursuant to the orders of 17 June 2019, 4 December 2020 and 16 February 2021. The wife has received $167,906.25 by way of part property settlement pursuant to orders made 16 February 2021. That is, the husband has received a part-property settlement advance in the sum of $135,000 more than the wife.
On 29 June 2022, at the conclusion of the trial consent orders were made by the Court which included provision for a division of their chattels.
Legal Principles
Section 79(1) of the Act provides that the Court may make such orders as it considers appropriate altering the interests of the parties in property. Section 79(2) of the Act provides:
The 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.
If the Court is so satisfied that it is just and equitable to make an order altering the interests of the parties in property, s 79(4) of the Act sets out the matters which the Court must take into account when considering what order (if any) should be made.
The High Court of Australia (the “High Court”) in Stanford v Stanford (2012) 247 CLR 108 (“Stanford”) revisited the process for trial judges in altering property interests of parties pursuant to s 79 of the Act for married parties, and s 90SM of the Act for de facto couples. The High Court emphasised the requirement for the Court to establish firstly, that it be just and equitable in the particular circumstances of the case to make any alteration of property interests. In this process, the question presented by s 79(2) of the Act, namely, “whether, having regard to those existing interests, the Court is satisfied that it is just and equitable to make a property settlement order,”[59] must not be merged with, or supplanted by the inquiries under ss. 79(4)/90SM(4) of the Act.[60] In determining whether it is just and equitable to make an order, the matters which can be taken into account do “not admit of exhaustive definition.”[61] However, there must be a “principled reason for interfering with the existing legal and equitable interests of the parties to the marriage.”[62]
[59] Stanford v Stanford (2012) 247 CLR 108, [37].
[60] Stanford v Stanford (2012) 247 CLR 108, [51].
[61] Stanford v Stanford (2012) 247 CLR 108, [36] referring to Mallet v Mallet (1984) 156 CLR 605, 608 per Gibbs CJ.
[62] Stanford v Stanford (2012) 247 CLR 108, [41].
The parties seek that the Court make a just and equitable alteration of their property interests, including superannuation interests. Their marital relationship is at an end and they each concede that such alteration is necessary.
Issues for Determination
W Pty Ltd (in liquidation)
In mid-2021, the wife appointed PP Financial Services as liquidators of the company. It was the wife’s unchallenged evidence that she did so on the advice of Mr T, and taking into account the following factors:
a)the sale of the former matrimonial home (which had been ordered by the Court), meant that [W Pty Ltd] lost its overdraft facility which it had used to manage its cashflow. Once the cashflow was forecast to dip below the amount in the bank, the business was at risk of trading whilst insolvent;
b)the amount of cash in the bank was impacted by the partial payments that the wife was ordered to make to the husband, as well as the legal fees that the wife was required to pay for both she and the husband (pursuant to a “dollar for dollar” costs order made by the Court); and
c)the significant effect that the COVID-19 pandemic had on revenue in the consultancy industry and [W Pty Ltd] in particular, which amounted to an approximately 65-80% decline in revenue.
The husband contended that the financial demise of the W Pty Ltd business arose due to Mr T advising the wife as a pre-insolvency specialist, to divert money and contracts away from the business. The husband believed Mr LL expressed an interest in buying the wife’s business, which was the case, and went to some lengths to do so.[63] When the husband cross-examined Mr T, Mr T stated he had introduced Mr LL to the wife within a broader process within the business sale. Contrary to the husband’s suspicions, Mr T had no business relationship with Mr LL, and nor had Mr T diverted any work to Mr LL from W Pty Ltd. Mr LL made a minimal offer, but on the wife’s unchallenged evidence he did a lot of business with W Pty Ltd and did not wish to pay for a customer base that he already had access to.
[63] Transcript 29 June 2022, p.89 lines 6-7.
Whilst the husband consented (on 16 February 2021) to orders making provision for the sale of W Pty Ltd, those orders specified no price, or means of ascertaining a sale price. The husband claimed that the business should have been sold for $650,000, despite the conditions attached to, and lack of genuineness of that offer. The husband claimed the wife’s action in refusing that offer lead to the liquidation of the company. I reject that claim. The evidence does not support it. The evidence supports the wife’s assertions.
Self-managed superannuation fund and the F Town Property
The wife and the husband are directors and shareholders of Agius Superannuation Pty Ltd which is the trustee of Superannuation Fund 1, the parties SMSF.
The SMSF was established in late 2017.
In late 2017, the SMSF purchased the F Town property under the name of E Pty Ltd, a company of which the parties are the directors and shareholders, as the holding Trustee for Agius Superannuation Pty Ltd.
In mid-2018, and following the removal of the husband from the FMH, the husband began to reside in the F Town property causing the SMSF to be non-compliant.
In early 2022, both parties received a Default Notice from the G Bank in relation to the mortgage secured against the F Town property.[64]
[64] Wife’s affidavit filed 24 June 2022, paragraph 93.
A short time later in 2022, the wife contacted B Lawyers and the husband seeking clarification as to whether the SMSF would place the F Town property on the market for sale. No response was received from either B Lawyers or the husband personally.[65]
[65] Wife’s affidavit filed 24 June 2022, paragraph 96.
On 12 May 2022, I made orders that parties were to sell the shareholding owned by their SMSF, and apply the net proceeds of the sale to the mortgage …. At trial, the shares had not been sold by the husband who had the practical conduct of the sale.
It was the evidence of the wife that if mortgage arrear payments were not made by mid- 2022, the G Bank would commence enforcement proceedings claiming the amount outstanding and/or exercise their power of sale in relation to the F Town property. This had not occurred at the time of trial.[66] At trial, the mortgage was approximately $14,000 in arrears.
[66] Wife’s affidavit filed 24 June 2022, paragraph 99.
The husband remained in occupation of the F Town property at trial, and had not made mortgage payments in accordance with orders made on 12 May 2022, that he do so. He had available to him his income, and should have had the proceeds of the SMSF shares sale which had earlier been ordered by the Court. Additionally, the husband had the part-property settlement sums available to him together with the other funds (as described above) as held by him.
It was the husband’s evidence that he had to relocate to the F Town property because he had not received any financial support from the wife, or income from the business since separation. Further, it was his evidence that his current financial circumstances precluded him being able to meet his living expenses. I do not accept his evidence. The husband was in receipt of the monies as described in paragraphs [36] and [102]-[106] of these reasons, and he has continued to be in receipt of weekly income protection insurance policy payments. The wife asserted this was $6,144 a month at the time of separation.
Additionally, the wife continued to make payments for the mortgage on the F Town property in which the husband resided from late 2018 until early 2021. The wife also made payments of taxes for the F Town property; the husband’s personal income tax; the husband’s personal mobile phone plan and personal insurance premiums; and repairs to the husband’s car (as paid for and owned by the SMSF).
The wife’s financial statement filed 24 May 2019 indicated she was receiving an income of $3,073 per week, and had personal expenditure of $3,719 per week.
It was the husband’s position he should solely retain the SMSF, and the F Town property, after a payment out to the wife. The husband intended for his new partner to become a member of the SMSF. It was his evidence that his partner has $300,000 in superannuation entitlements that she is able to transfer to the SMSF upon her becoming a member of the SMSF. He would then be in a position to meet the ongoing F Town mortgage payments, as the property could be rented out and the husband could live with his new partner in City AA. According to the husband’s evidence, the property cannot be currently rented out, nor sold, because the building is not complete. I note the husband’s new partner was not in evidence before the Court.
At trial the husband asserted that when he sold the SMSF shareholding remaining, he would receive somewhere between $10,000 - $12,000 which he would apply to the F Town property. The husband did not know whether there was any capital gains tax payable on the share sale. The husband conceded the mortgage arrears, but claimed he could pay then in addition to the penalty payment if he was able to interchange the wife with his new partner in the SMSF. The husband conceded that the scenario he proffered was dependent on the continuation of his new relationship. He provided no evidence to the Court which would satisfy the Court of the feasibility of what he proposed.
It was the wife’s position that the F Town property should be sold, with vacant possession, after any necessary improvements or required renovations, as to be advised by QQ Financial Services.
Motor Vehicle 1
Motor Vehicle 1 is owned by the husband and has been driven 200,000 kilometres. The Court was provided with a Redbook valuation by Counsel for the wife, which exceeded the value placed upon the vehicle by the husband. The Court requested the parties agree the value at $15,000. This value was accepted by both parties during the proceeding.[67]
[67] Transcript 29 June 2022, p.159.
Inclusion on Tax
It was the husband’s evidence that each party should be liable for their own taxation liabilities.
It was the wife’s evidence that her taxation liability arose in circumstances where the husband and wife both benefitted from the income received by the wife in the operation of her business. It was the wife’s evidence that the husband used the wife’s business as his own. During the parties’ relationship, the husband purchased, for his use, a $178,105 Motor Vehicle 2 which was leased through the wife’s business without her consent. The wife claimed this committed the company to a $2,500 monthly repayment, which was paid until mid-2016 when the wife asked the husband to sell the car due to financial difficulties in the business. One year later, the husband sold the car for a profit. The husband claimed the car was “always designed” for the wife, although ultimately “it was [his] car”,[68] and consolation for him giving up his career to look after the children.[69]
[68] Transcript 28 June 2022, p.65 line 36.
[69] Transcript 28 June 2022, p.66 line 15.
At trial, the wife was awaiting a ruling from the Australian Taxation Office as to whether she had a liability of $473,000 in respect of her business operations and under her personal name, and if such debt was owing, whether an interest component will significantly increase this sum payable. Despite the uncertainty about the taxation debt sum, the parties sought that the trial proceed on the evidence before the Court, of “apportionment and attribution of debt”.[70] The wife’s counsel stated this amount could range between $473,000 and $873,000, to which the husband agreed.
[70] Transcript 28 June 2022, p.14 line 38.
An amount of $317,500 had been advanced from the wife through the corporate entity D Pty Ltd , for the husband’s benefit since separation.
The wife’s position in her application to the Court was that the full $305,000 in trust on behalf of the parties be paid to the Australian Taxation Office. This was disputed by the husband who questioned “who would be paying [his own] tax”.[71] The husband did not see it to be his problem that the wife would have to work to pay off this tax for years to come.[72]
[71] Transcript 29 June 2022, p.106 line 39.
[72] Transcript 29 June 2022, p.106 line 44.
Other assets in dispute
The husband owns Motor Vehicle 3. The husband, in his financial statement filed 20 June 2022, stated that the motor vehicle had a value of $1,500. The wife submitted in her Case Summary Document filed 24 June 2022 that the motor vehicle is worth approximately $3,000. No corroborative evidence or valuation was before the Court. The Court was left with no evidentiary basis to prefer the evidence of one party over the other. In those circumstances, I consider it just and equitable to compromise the parties estimates of is value.
The Asset Pool
The following table outlines the legal and equitable interests of the parties as determined by the Court including superannuation:
Personal assets of the parties
Ownership
Value
Remaining proceeds of sale of J Street, Suburb L (Held in Trust by B Lawyers)
Joint
$305,031
Motor Vehicle 4
Husband
E$5,000
Motor Vehicle 1
Husband
$15,000
Motor Vehicle 3
Husband
$2,250
Motor Vehicle 5
Wife
$15,000
Furniture and Artwork
These have been divided by the parties and no valuation evidence was before the Court. No further adjustment is sought.
Household Contents
These have been divided by the parties and no valuation evidence was before the Court. No further adjustment is sought.
Husband’s bank account
Husband
$300
Wife’s ANZ bank account ending …39
Wife
$1,192
W Pty Ltd / Agius Family Trust
Wife
NIL (In Liquidation)
Agius Family Investments Pty Ltd
Husband
NIL
D Pty Ltd
Wife
NIL
Agius2 Pty Ltd ATF M Unit trust (Wife’s new business)
Wife
Nominal
Cryptocurrency
Husband
N/K
Assets Subtotal
$343,773.00
Personal liabilities of the parties
Ownership
Value
Income tax (income tax assessed and unpaid for last financial year and previous financial years)
Husband
$27,300
RR Bank loan
Husband
$29,635
RR Bank Visa (credit card)
Husband
$46,199
BB Card (credit card with G Bank)
Husband
$5,200
ANZ Visa credit card
Wife
$2,614
CC credit card
Wife
$605
Tax debt (personal and D Pty Ltd)
Wife
E$473,991 with a further potential $400,000 approximately
Liquidator fees
Wife
E$100,000
Fees of Z Lawyers Pty Ltd and C Lawyers
Husband
$25,440
Liabilities subtotal
$710,984 without potential liability
$1,110,984 with potential liability
Superannuation
Ownership
Value
E Pty Ltd
H Street, F Town
(Less mortgage to G Bank)
Joint SMSF
$1,000,000
($468,000)
Equity = $532,000
Share Portfolio
Joint SMSF
E$10,000
Superannuation Fund 2
Wife
$15,091
TOTAL NET ASSETS EXCLUDING SUPERANNUATION
-$367,211 without potential liability
-$767,211 with potential liability
TOTAL NET ASSETS INCLUDING SUPERANNUATION
$189,880 without potential liability
-$210,120 with potential liability
Not included in the above table is the husband’s conceded sole liability for the sum of $63,036.10 being the estimated penalty fee for his occupation of the SMSF F Town property.
The table above does not take into account the protected nature of the parties’ superannuation entitlements. The F Town property forms part of their superannuation and is their major asset. Accordingly the parties will share in whatever equity that may provide to them.
Is it just and equitable to make property orders based on the parties’ relative contributions?
Being satisfied that it is just and equitable to make orders adjusting the property interests of the parties, as desired by the parties themselves, what follows is a consideration of s 79(4) of the Act. That section is as follows:
(4) In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(a) the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c) the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d) the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
(f) any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
Whilst I have considered as a precondition to making an order for property settlement whether it is just and equitable in all the circumstances of the particular case to make such an order, the Full Court of the Family Court in Bevan & Bevan (2013) FLC 93-545 at [86] made clear that the just and equitable consideration is one that “permeat[es] the entire process”. I will now turn to the contributions of the parties.
Contributions
An assessment of contributions is “holistic” in nature.[73] It is nevertheless of assistance to consider that evidence of contributions in the manner as set out below to provide some structure to the task.
[73] Dickons & Dickons (2012) 50 Fam LR 244, [24].
Initial contributions
At the commencement of the parties’ cohabitation, the wife was earning approximately $175,000 per annum and had approximately $90,000 in superannuation. The husband earnt approximately $40,000 per annum and had nominal superannuation. It was the wife’s evidence that the husband had a debt of approximately $30,000, and drove a leased motor vehicle with little or no equity. The husband did not challenge that evidence.
It was common ground that during the parties’ relationship, both contributed to the care and well-being of the parties’ children. I accept the wife’s evidence that during cohabitation, “a large proportion of the home duties were performed by paid nannies, professional cooks, and professional cleaners” that both parties hired.[74] The husband conceded that the parties employed nannies when the children were small, but claimed that as they got older he took over their care. I find on the evidence that he did so but as assisted by a nanny who looked after the children after school and cleaned, and cooked the evening meal. He was also assisted by the wife. The husband conceded the parties thereafter hired a cook for a couple of days a week as both parties worked, and engaged cleaners. I find both parties were actively involved in the care of their children, and neither was a primary caregiver beyond their infancy.
[74] Wife’s affidavit filed 24 June 2022, paragraph 111.
It was the wife’s unchallenged evidence that during the course of the relationship she made far greater financial contributions than the husband.[75]
[75] Wife’s affidavit filed 24 June 2022, paragraph 108.
During the course of the parties’ relationship, the wife received a $30,000 settlement payment regarding a workplace sexual harassment claim she made against her then employer. That money went to the purchasing of a business that the husband ran for a brief time, before the parties then sold that business .
The wife originally operated W Pty Ltd from the parties’ home. Sometime after the birth of Mr K, but prior to X being born, the wife commenced operating W Pty Ltd out of rented premises in the city.
Following the husband closing his business, the husband worked with SS Company in sales for approximately four months; at a TT Company for approximately two months; and a company called “UU Company” for four months.[76]
[76] Husband’s affidavit filed 20 June 2022, p.6.
The husband subsequently commenced a computer course before commencing work with W Pty Ltd on a part-time basis in approximately 2010.
It is the husband’s evidence that he renovated and sold three houses during the parties cohabitation, with the initial investment money coming from the wife.
Contributions post separation
The husband purchased a new ride on mower and fencing to maintain the F Town property, and installed a fireplace due to a lacking of heating at the property.[77] He was of course occupying the property. He paid no rental or mortgage sum for his occupation of the property. The FMH was sold to meet the parties’ debts and the wife commenced to pay rental for her and the children’s accommodation.
[77] Husband’s affidavit filed 20 June 2022, paragraph 96.
The wife continued to pay the mortgage and taxes on the FMH until its settlement, and on the F Town property until in or around early 2021.[78]
[78] Wife’s affidavit filed 24 June 2022, paragraphs 132(b)(i)-(ii).
The wife made considerable payments to the husband by way of part-property settlement and litigation funding. Those payments were made from pre-tax income. The husband otherwise obtained funds as described in paragraphs [102] – [106] above.
The wife solely financially supported the children. This was a significant expenditure and in circumstances where Mr K was not seeing his father prior to his turning 18 years.
Relevant section 75(2) factors
I am satisfied on the evidence before me that both the husband and wife are in good health.
The husband is unemployed and receives approximately $76,000 per annum by way of income protection insurance policy payments. It was the husband’s evidence that he will likely be living in City AA with his new partner.
The wife self-employed and receiving income of $436,384 gross per annum. She resides in rental accommodation in Suburb XX with the parties children. Given Mr K’s significant health issues, I am satisfied that he remains reliant upon the wife to support him. Clearly, X does also. The wife financially supports the children.
Neither of the parties are cohabitating with another person though the husband suggested that he may and in that context that his partner would contribute $300,000 of superannuation monies to the husband’s superannuation fund to enable him to retain the F Town property.
Conclusion
In my view it is just and equitable in the circumstances of this case to equally apportion the assets and liabilities of the parties between them. The exception to this shall be the payment by the husband of the intervenors monies owing, in accordance with the Court order of 16 June 2022. The payment out of these outstanding legal costs of the husband places the parties in a position of equality in the payment of their legal fees until such time as the husband ceased to be represented. The payment of the husband and wife’s legal fees came from the income of the wife, before tax.
The wife’s contributions at the commencement of cohabitation exceeded those of the husband but I make no adjustment in regard thereto. The parties’ myriad of contributions during the course of their cohabitation and marriage followed this greater initial contribution of the wife, and I find, taking all those contributions into account, that the parties’ contributions to the point of separation should be assessed as equal.
The wife’s contributions exceeded those of the husband in the period post separation, however, in respect of her care and support for the children. She solely provided financial support for the parties children and continues to do so for the child X, and adult child Mr K. The wife also had, and continues to have, a more onerous care obligation than the husband.
Overall, I find an adjustment of 5% in the wife’s favour is warranted in respect of these matters.
The s 75(2) of the Act matters favour the husband in respect of the income disparity between the parties, and their respective earning capacity. Clearly, the wife’s income and earning capacity is significantly greater. The wife has however the ongoing financial support of X without assistance from the husband, save as to his incurring of petrol costs on those occasions that he transports X. This responsibility is a significant one with significant financial impact upon the wife.
I find an adjustment of 5% in the husband’s favour is warranted after my consideration of the s 75(2) matters.
An overall adjustment of the parties’ property interests to a position of equality is in my view just and equitable. There is only the parties’ superannuation fund assets available to them.
I shall order that the wife have control of the sale of the F Town property. The parties have been unable to deal with each other in a constructive way concerning this property. The husband has occupied the property in the face of objection by the wife. The husband has not paid the mortgage as ordered by the Court such that arrears have accumulated with a default notice being issued. The husband opposes any sale of the property and has sought its retention within the super fund as controlled and owned by him, with a proposal that his new partner become a member of the fund. The husband’s proposals are not on the evidence capable of practical effect nor do they provide justice and equity to the wife. The husband’s resistance to the sale of the F Town property is longstanding. In my view, any order for the parties to jointly sell the property would see them litigating further. The husband shall be required to vacate the property leaving the wife to handle the sale. The parties do not have the funds to apply monies towards any improvements to the property and will need to sell it as is, unless they agree otherwise and upon the recommendation of the selling agent.
The parties must share in the taxation liabilities that have been incurred by virtue of their corporate entities operations and by virtue of the wife’s income in relation to which tax was not paid, in circumstances where monies were advanced to the husband by way of part-property settlements, and to a lesser extent to the wife. Additionally, there was the payment of legal costs for both parties out of the wife’s income. The husband has received considerably more than the wife in part-property payments, but the wife does not seek any adjustment in that regard beyond seeking an equal division of assets between the parties.
The property orders which the Court makes are those as sought by the wife (save for a further payment of the husband’s legal costs to the intervenors) which are supported by the evidence.
I certify that the preceding one hundred and eighty-seven (187) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Hartnett. Associate:
Dated: 21 October 2022
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