Agosta & Haldane
[2024] FedCFamC2F 935
•19 July 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Agosta & Haldane [2024] FedCFamC2F 935
File number(s): DGC 4160 of 2021 Judgment of: JUDGE JENKINS Date of judgment: 19 July 2024 Catchwords: FAMILY LAW – de-facto property – asset pool in dispute – admissibility of medical records – admissibility of redbook valuation – admissibility of parties’ own estimate of value in financial statement – initial contributions – springboard – inheritance – post-separation care of children – impact on earning capacity of care of children Legislation: Evidence Act 1995 (Cth)
Family Law Act 1975 (Cth)
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)
Cases cited: Adamson & Adamson [2014] FamCAFC 232
AJO & GRO [2005] FamCA 195
Aleksovski & Aleksovski [1996] FamCA 111
Bain & Bain (deceased) [2017] FamCAFC 80
Bevan & Bevan [2013] FamCAFC 116
Carlson & Fluvium [2012] FamCA 32
Clauson & Clauson (1995) FLR 92
Dickons & Dickons [2012] FamCAFC 154
Ellis v Wallsend District Hospital (1989) 17 NSWLR 553
Frederick & Frederick [2019] FamCAFC 87
Hickey & Hickey & Attorney General for the Commonwealth of Australia [2003] FamCA 395
Lancaster v The Queen[2014] VSCA 333
Lee Steere & Lee Steere [1985] FamCA 57
Linch & Linch [2014] FamCAFC 69
Mallet v Mallet [1984] HCA 21
Purkess v Crittenden (1965) 114 CLR 164
Division: Division 2 Family Law Number of paragraphs: 110 Date of last submission/s: 24 April 2024 Date of hearing: 22 – 24 April 2024 Place: Dandenong Counsel for the Applicant: Mr Whitchurch Solicitor for the Applicant: Ian Robertson Lawyers Counsel for the Respondent: Mr Hall Solicitor for the Respondent: Betts Law Company ORDERS
DGC 4160 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS AGOSTA
Applicant
AND: MR HALDANE
Respondent
ORDER MADE BY:
JUDGE JENKINS
DATE OF ORDER:
19 JULY 2024
THE COURT ORDERS THAT:
1.Within 60 days of the date of these orders (“the due date”) the Applicant do all such acts and things and sign all such documents as may be required to:
(a)Transfer to the Respondent all of her right, title and interest in the real property situate at and known as B Street, Town C, New South Wales, described as Lot … in Neighbourhood Plan … and more particularly described in Folio … (“the Town C Land”);
(b)Authorise the discharge of the mortgage secured upon the title of the Town C Land (“the Town C mortgage”); and
(c)Cause to be paid to the Respondent care of his solicitors from the fund presently held by S Law Firm the total of the funds held in trust (“the payment”) less $1,100 which is to be released to Ms S in full satisfaction of the cost order in Order 12 herein.
2.The injunction contained in paragraph 12 of the consent property orders made on 17 November 2021 be extended in respect of the Applicant until the Applicant has performed Order 1(c) hereof or any application for costs sought by either party has been determined, whichever is the later.
3.The Respondent meet the costs of the transfer of the Town C Land except for the Applicant’s individual cost of PEXA workspace entry which shall be paid by the Applicant.
4.Contemporaneous with the Applicant’s completion of Order 1 the Respondent:
(a)Procure the discharge of the Town C mortgage and indemnify the Applicant against all payments and liability pursuant to mortgage and all other outgoings of the Town C Land of whatsoever nature and kind; and
(b)Withdraw at his expense the caveat lodged over the real property at D Street, Town E in the State of Victoria.
5.In default of the Respondent obtaining a discharge of the Town C mortgage as ordered in Order 4(a) the Town C property be forthwith sold altogether out of court (“the default sale”) and upon completion of the sale the proceeds be applied:
(a)First to pay the costs of the sale;
(b)Secondly to discharge the Town C mortgage; and
(c)Thirdly the balance then remaining be paid to the Respondent care of his solicitor.
6.There be liberty to apply with respect to the default sale.
7.Pursuant to s 90XT(1)(a) of the Family Law Act 1975 whenever a splitable payment becomes payable in respect of the interest held by the Respondent (member number …) in Super Fund 1 (“the Fund”) , the Applicant shall be entitled to be paid an amount calculated in accordance with the regulations, using a base amount, at the date of these orders, in the sum of $34,497.00 and that there be a corresponding reduction to the entitlement the Respondent would have had in the Fund but for this order.
8.The Respondent be solely liable for and indemnify the Applicant against all payments and liability pursuant to the holiday site rental contract executed by the parties at F Street, Town G, and he be solely entitled to rights of occupation pursuant to that lease.
9.The Applicant retain all right, title and interest in:
(a)Her one-third interest in the real property situate at and known as D Street, Town E;
(b)Any claim for reimbursement of funds taken by her brother Mr H prior to the passing of Mr J;
(c)Motor Vehicle 1 that is registered in the Applicant’s name; and
(d)Furniture, chattels and personal effects in her possession.
10.The Respondent retain all right, title and interest in:
(a)The funds held on trust by his solicitors in the sum of $167,400;
(b)Motor Vehicle 2 that is registered in his name;
(c)The outbuildings at F Street;
(d)His interest in motor vehicles;
(e)Furniture, chattels and personal effects in his possession.
11.Unless otherwise specified in these orders and save for the purposes of enforcing the payment of any monies due pursuant to these or any previous orders of the Court:
(a)Each party be solely entitled to the exclusion of the other party to all chattels (including choses in action) in the possession or control of the first-named party of whatsoever nature and kind;
(b)Each party be solely entitled to monies held on trust by that party’s family law solicitor;
(c)Monies standing to the credit of the parties in any joint bank account be divided equally and the relevant bank account be closed within 90 days;
(d)Each party be solely liable for and indemnify the other against all payments and liability in relation to any credit finance relating to any chattel retained by that party pursuant to these Orders;
(e)Each party be solely entitled to superannuation entitlements belonging to or earned by that party;
(f)Insurance policies become the sole property of the owner named thereon; and
(g)Any joint tenancy in any real or personal property is hereby expressly severed.
12.The Respondent pay to Ms S her costs of attendance at the hearing on 23 April 2024 fixed in the sum of $1,100.
13.All extant applications be otherwise dismissed save as to costs.
THE COURT NOTES:
A.That pursuant to s 90ST of the Family Law Act 1975 (Cth) it is intended that these orders shall finally determine the financial relationship between the parties and avoid further proceedings between them.
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).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of 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 a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE JENKINS:
This matter concerns a division of property following a lengthy de facto relationship which produced two children. For ease of reference, I shall refer to the parties as the husband and wife respectively.
The parties largely agree on the asset pool, save for some small but not insignificant arguments over some motor vehicles, an entitlement the wife may have to further funds under an inheritance, the value of outbuildings at F Street, and whether funds should be repaid to a friend of the husband.
In terms of the adjustment of the property pool, each agreed they should retain the property they currently had in their names. The dispute came down to how to divide funds held in the S Law Firm trust account, being $167,888.00 (“the funds held on trust”). The husband sought 60 per cent of the total pool in his favour, primarily due to his care of the children, however, because such an adjustment would require a property to be sold which was owned by the wife and her brothers, he was prepared to take slightly less, being the entirety of the funds held on trust. The wife sought a payment of $100,000 which she said would equalise the assets. Although the wife largely conceded the husband’s “future needs” argument, she submitted it was entirely offset by her contributions, namely a significant inheritance.
BRIEF BACKGROUND
The parties commenced their relationship in or about 2008 and separated on 16 September 2021.
The parties have two children, X who is 15 years of age and Y who is 13 years of age (“the children”). The children have lived with the husband since separation.
The husband and children moved to live in Town C in late 2023. The wife remains living in Melbourne.
The parties agreed to final parenting orders on 9 November 2023 which provided for the children to remain living with the husband in Town C, and to spend time with the wife on one weekend per month.
The husband is a tradesperson but has now obtained employment as a labourer at K Company. The wife is a labourer.
DOCUMENTS RELIED UPON
The wife relied upon the following documents:
(a)her amended initiating application filed 5 November 2023;
(b)her trial affidavit filed 2 April 2024;
(c)her amended financial statement filed 5 November 2023;
(d)the affidavit of Mr L (registered real property valuer) filed 1 April 2024; and
(e)the affidavit of Mr M (certified and practicing valuer – motor vehicle specialist) filed 1 April 2024.
The husband relied upon the following documents:
(a)his amended response filed 31 January 2022;
(b)his trial affidavit filed on 2 April 2024;
(c)his financial statement filed on 16 April 2024:
(d)the affidavit of Mr N filed on 2 April 2024;
(e)the affidavit of Ms O filed on 2 April 2024.
In addition, the following exhibits were tendered during the proceedings:
·A1 – registration of P Business ABN business name in the respondent’s name registered from 2023;
·A2 – Receipt to Mr Haldane dated 24 January 2019;
·R1 – bundle of documents relating to historical search, transfer of land and second transfer;
·R2 – bundle of Q Street documents;
·R3 – bundle of probate documents in relation to the wife’s father;
·R4 – bundle of 7 photographs of the parties;
·R5 – historical title search for the Town E property;
·R6 – bundle of 5 photographs of “outbuilding”;
·R7 – enrolment form for X at R School;
·R8 – bundle of documents (letters to and from husband’s solicitor 18 and 19 April 2024;
·R9 – text exchange of the parties on 14 June 2022;
·R10 – file note of Ms S dated 22 April 2024;
·R11 – wife’s payments record from 9 February to 22 April 2024;
·R12 – photograph of the kitchen at the Town E property;
·R13 – diagram drawing of the Town E property of works done by the husband;
·R14 – husband’s car valuation dated 7 March 2024 and photographs;
·R15 – payslip of the husband with payment dated 14 February 2024;
·R16 – disclosure statement of Town G Holiday site;
·R17 – email from Mr N dated 14 June 2022;
·R18 – text exchange in relation to orthodontic work;
·J1 – documents produced pursuant to subpoena to Ms S collectively dated 19 April 2024;
·J2 – joint table of assets sent by counsel for husband 19 April 24 at 4.02pm (with yellow highlighting); and
·J3 – composite minute of proposed final orders dated 24 April 2024.
OBJECTIONS TO EVIDENCE
Various paragraphs of the parties’ trial material were objected to and were the subject of rulings during the trial. The parties were subsequently directed to file redacted versions of those affidavits. It is those versions of the affidavits to which I have had regard.
In addition, the husband objected to the wife relying upon a Redbook valuation of his vehicle. I reserved my decision on this issue but now find that such evidence is not admissible, as it is hearsay and unqualified opinion. Even if it were admissible, the husband’s evidence is that the vehicle in the Redbook valuation was not the same model as his, had different features, had driven substantially more kilometres, and was significantly damaged. Accordingly, the Redbook valuation would be of no assistance in this matter.
The other reserved objection was to medical records the husband sort to tender into evidence. The husband argued these were an exception to the hearsay rule as they were business records. I accept that the records do constitute business records as set out in section 69 of the Evidence Act 1995 (Cth),[1] and will allow them to be admitted into evidence as an exhibit in this matter.
[1] See also authorities such as in Lancaster v The Queen[2014] VSCA 333.
However, given the prejudice to the wife in not being able to test the contents of the medical records, I do not propose to give that evidence any weight.[2]
[2] See Linch & Linch [2014] FamCAFC 69.
THE EVIDENCE
The final hearing of this matter commenced 22 April 2024 and was heard for three days, concluding 24 April 2024. Although some of the evidence was heard over Microsoft Teams (being the cross examination of the husband’s witness), I am satisfied that this did not interfere with the fair conduct of the trial.
In determining these proceedings, I have had regard to all the evidence presented at trial. It is not possible to include every aspect of the parties’ evidence in these reasons for judgment. However, if a particular fact or issue is not mentioned in these reasons, it does not mean that I have failed to consider it.
Section 140 of the Evidence Act 1995 (Cth) sets out that the standard of proof in these proceedings is to a balance of probabilities.
Pursuant to Rule 8.15 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) ("the Rules") the following applies:
(3) A document that is to be used in conjunction with an affidavit:
(a)must be identified in the affidavit; and
(b)must be filed as an annexure or an exhibit to the affidavit; and
(c)must be paginated; and
(d)must bear a statement signed by the person before whom the affidavit is made identifying it as the particular annexure or exhibit referred to in the affidavit; and
(e)must not be accepted as evidence in the proceeding unless and until it is separately tendered in evidence at the hearing of the application and accepted into evidence by the court.
(emphasis added)
Accordingly, I have not had regard to annexures or documents in tender bundles not otherwise tendered to the court.
Each of the parties gave evidence in this matter, as well as the wife’s distant relative, Ms S, and the husband’s friend Mr N. Mr L, Mr M, and Ms O were not required for cross-examination.
In this case, I was urged to make credit findings about the wife. It was argued that with respect to certain key matters, the wife was intentionally dishonest. What was apparent in this matter was the wife was highly emotional for much of her evidence and that she is still grieving the “loss” of her children, who have chosen to live with their father and spend little time with her. She clearly blames the husband for this situation and unfortunately her bitterness appeared to impact her evidence. For example, the wife initially denied any knowledge of the husband bringing into the relationship a property at T Street, Town U (“the Town U property”) or that her signature on the transfer of land of that property,[3] was how she signed her name. However, when later shown a school enrolment form, which the wife agrees she signed, she reluctantly admitted that it looked like the same signature. This ties in with another inconsistency in the wife’s evidence, namely her denial that she ever had an intention to move to Town C, despite signing the aforementioned enrolment forms for the children to attend R School when the parties were still living together. Unfortunately, for this reason, I must treat the wife’s evidence with some caution, where it is otherwise uncorroborated.
[3] See respondent's exhibit R-1.
However, the husband’s evidence was also somewhat problematic. Whilst for the most part the husband appeared to give evidence in a forthright and honest manner, there were a number of inconsistencies in his evidence, in particular concerning debts owed to his friend, Mr N, and to which I shall return in due course.
THE LAW
The relevant legal principles governing any application for de facto property settlement are set out in Part VIIIAB of the Family Law Act 1975 (Cth) ("the Act"). Section 90SM(1) of the Act authorises the court to make such orders between the parties as it considers appropriate. Section 90SM(3) makes it clear that the court cannot make an order for a property settlement unless it is just and equitable to do so.
Earlier Full Court authorities have identified a four-step process that can assist the court in reaching a just and equitable decision: see Lee Steere & Lee Steere [1985] FamCA 57; Hickey & Hickey & Attorney General for the Commonwealth of Australia [2003] FamCA 395; and AJO & GRO [2005] FamCA 195. Although these relate to marital relationships, the process is equally applicable to an application for a de facto property adjustment.
The first step for the court is to identify the parties' existing legal and equitable interests in the assets arising from their relationship, together with their liabilities. The court should then assess each party's contributions during the relationship in accordance with ss 90SM(4)(a), 90SM(4)(b) and 90SM(4)(c). The third step requires the court to consider the range of factors set out in ss 90SM(4)(d), 90SM(4)(e), 90SM(4)(f) and 90SM(4)(g), including the factors identified in s 90SF(3). The court should then consider those findings and, if satisfied that it is just and equitable to do so, make orders adjusting the parties' property interests.
The Full Court in Bevan & Bevan,[4] in the joint judgment of Bryant CJ and Thackray J, reminded trial judges that the "four step process" is not legislatively mandated. Rather, it provides a structured process towards the ultimate requirement, which is to ensure that a property settlement order is only made when the court is satisfied that it is just and equitable to do so, and that the terms of the order itself are also just and equitable.
[4] [2013] FamCAFC 116 ("Bevan") at [62].
THE ASSETS
In final submissions the husband provided an aide memoire which summarised the outstanding disputes with respect to the asset pool, as follows:
DESCRIPTION TITLE VALUE FINANCIAL EFFECT APPLICANT FIGURES RESPONDENT FIGURES APPLICANT RESP. APP RESP APP RESP ASSETS 1 D Street, Town E DFW 366,000 366,000 366,000 366,000 2 Sum owed to Applicant by Mr H DFW 56,333 56,333 3 Land at B Street, Town C (sworn) Joint 380,000 380,000 380,000 380,000 4 Part property settlements paid out to Applicant 139,119 Joint 139,119 139,119 139,119 139,119 5 Funds held on trust by Applicant solicitor 167,689 Joint 167,688 167,688 167,688 167,688 Total 306,808 Joint 6 Part Property settlements paid out to Respondent’s 139,408 Joint 139,408 139,408 139,408 139,408 7 Funds held on trust by Respondent’s solicitor 167,400 Joint 167,400 167,400 167,400 167,400 Total $306,808 Joint 8 Motor Vehicle 1 (DFW) 100% 5,000 15,000 5,000 15,000 9 Motor Vehicle 2 (DFH) 100% 42,680 19,000 42,680 19,000 10 Net value of Outbuilding and fittings at Town G Dispute 40,000 10,000ii 40,000 10,000 11 Motor Vehicle 3 (single expert value $20,000) DFH 20,000 20,000 20,000 20,000 12 Motor Vehicle 4 at Town G DFH 10,000 10,000 10,000 10,000 13 Motor Vehicle 5 (single expert value: $5,000) DFH ½ 2,500 2,500 2,500 2,500 14 Motorcycle (DFH) 100% 1,500 1,500 1,500 1,500 15 Motor Vehicle 6 and equipment DFH 500 500 500 500 16 Motor Vehicle 7 (single expert value: $2,000) DFH 1/3 667 667 667 667 17 Commonwealth Bank Smart Access DFH Nominal Nominal Nominal Nominal GROSS ASSETS 1,482,462 1,490,115 510,119 972,343 574,140 918,663 LIABILITIES 18 Mortgage - Town C Joint (151,062) (151,062) (151,062) (151,062) 19 Rates - Town C Joint (3,585) (3,585) (3,585) (3,585) 20 Body corporate fees owing - Town C Joint (6,684) (6,684) (6,684) (6,684) 21 Debt to Mr N re: Motor Vehicle 3 (20,000) (20,000) Liabilities subtotal (161,331) (181,331) (161,331) (181,331) NET CURRENT ASSETS 1,321,131 1,308,784 510,119 811,012 574,140 737,332 Percentile distribution 38.6% 61.4% 43.7% 56.3% SUPERANNUATION VALUE DISTRIBUTION FUND APPLICANT RESPONDENT SAME FIGURES, SAME BASE AMOUNT 22 Applicant’s Super Fund 2 interest (not updated since 30.6.23) 39,030 39,030 39,030 39,030 23 Respondent’s Super Fund 1 interest 108,024 108,024 108,024 108,024 24 Base amount adjustment 34,497 (34,497) 34,497 (34,497) Superannuation total 147,054 147,054 73,527 73,527 73,527 73,527 TOTAL ASSETS AND SUPERANNUATION 1,468,185 1,598,505 581,334 886,851 775,334 823,191
Accordingly, the issues in dispute were as follows:
·Item 2 Sum owed to the wife by Mr H (the wife’s brother);
·Item 7 Value of the wife’s Motor Vehicle 1;
·Item 8 Value of the husband’s Motor Vehicle 2;
·Item 9 Value of outbuilding and fittings at Town G; and
·Item 31 Debt to Mr N – the Motor Vehicle 3.
I will deal with each of these in turn.
Sum owed to the wife by Mr H
In or about 2017, the wife inherited a one third share in a property at D Street, Town E (“the Town E property”) from her father’s estate with her brothers Mr H and Mr V.
In mid-2021, lawyers for Mr H, W Law Firm, sent correspondence to the wife and Mr V requesting to be bought out of the Town E property.[5] The wife and Mr V consequently engaged Ms Z, of S Law Firm, to respond to this letter on their behalf, with a letter being sent in mid-2021 (“Ms Z’s letter”).[6] In that correspondence it was proposed that Mr V would buy out Mr H’s share of the Town E property for $140,000 which the letter implies is less than market value on the basis of a number of factors:
(1)That although Mr V had lived rent free in the Town E property, he had been responsible for rates and outgoings and had contributed significantly towards renovations;
(2)That there were multiple works that needed to be conducted on the property including repairing termite damage;
(3)That Mr H had received monetary gifts and other “benefits” in the two years prior to the father’s death, estimated at $169,000;
(4)That Mr V was unable to contribute any further to the purchase; and
(5)That Mr V would be liable for stamp duty, transfer fees and legal fees.
[5] Joint exhibit J1, at page 14.
[6] Joint exhibit J1, at page 17.
Ms Z then sent a follow-up email to W Law Firm in late 2021, as there had been no response, and that is the last correspondence that is before the court. The wife’s evidence is that this matter went no further. This was corroborated by Ms S, from S Law Firm, who was subpoenaed to give evidence in the matter. Ms S’s evidence was that Ms Z, who no longer works for the firm, had carriage of the matter, and was not supervised by Ms S. However, Ms S called her prior to giving evidence to obtain information about the matter and made a file note of that conversation.[7] In short, Ms Z confirmed “we didn’t really get anywhere” in terms of buying out Mr H’s share of the property.
[7] See Respondents exhibit R10.
Nonetheless, the husband asserts that Ms Z’s letter is somehow evidence that the wife has a one third entitlement to the $169,000 which it is asserted Mr H had the benefit of, prior to the father’s death. The husband argues that the wife did not pursue this further in late 2021 because it coincided with her decision to the end the marriage of the parties.
However, it is hard to see how Ms Z’s letter is evidence that the wife has a one third interest in the funds received by Mr H. The letter is a proposal that Mr V buy out Mr H’s share of the Town E property seemingly at a reduced amount. The financial “benefits” received by Mr H were just one of a number of matters included to try and persuade Mr H to do so.
At its highest the letter suggests that Mr V and presumably the wife, may have an argument that Mr H ought to sell his share of the property to the siblings at a reduced price, although, I do not have evidence of how much below market value it was at the time, noting the offer of $140,000 is actually higher than a third of the current market value.
It is otherwise unclear to me how either Mr V or the wife would now be entitled to pursue Mr H for a share of financial benefits given to him during their father’s lifetime, given the estate has long since been divided, and/or if they are able to make such a claim, the likelihood of success.
Accordingly, I do not propose to include item 2 in the asset pool.
Value of the wife’s Motor Vehicle 1
The wife estimates her Motor Vehicle 1 as being worth $5,000.[8] She based this at least in part from having spoken to a friend who was a mechanic and maintained the value under cross-examination. The husband says it is worth $15,000. Motor Vehicle 1 has not been valued.
[8] Financial Statement of Ms Agosta filed 5 November 2023, at item [40].
I note the Full Court in Frederick & Frederick [2019] FamCAFC 87 (“Frederick”) said the following at [39]:
We consider that, generally speaking, a person can give some evidence by way of admission as to the value of real estate owned by them which can be accorded weight, notwithstanding such weight might be very much less than the weight given to that of a professional valuer, for example. The ordinary common experience of people is that where they own only a few significant assets such as cars and houses, they are well aware of the purchase price and have some knowledge, obtained from a variety of sources, about their value.
Whilst the case of Frederick did not involve a final property hearing, but rather a hearing which was “summary in nature,” and therefore, it was not expected the parties would present the best evidence available, I do not read paragraph 39 of that judgment as being limited to final hearings.
The wife’s evidence as to value, is therefore admissible in my view, however, given my earlier comments as to her credibility, I must treat it with some caution. Nonetheless it is the only evidence of value before the court as the husband does not attest to same in his affidavit or financial statement. Accordingly, Motor Vehicle 1 will be valued at $5,000.
Value of the husband’s Motor Vehicle 2
The wife asserts the husband’s Motor Vehicle 2 is worth $42,680. This was seemingly based on enquiries made through Redbook in conjunction with the AA Company insurance value. However, unlike Motor Vehicle 1, the husband had obtained a valuation which included an inspection of the vehicle itself. Whilst this was not a single expert valuer as was anticipated by the orders of 9 November 2023, those orders provided for the wife to select a valuer, and she did not do so. Having seen the value attributed to the vehicle in the wife’s trial affidavit, the husband took the vehicle to be independently valued. This valuation, which assessed the vehicle at $19,000, was tendered into evidence.[9]
[9] See Respondent’s exhibit R14.
This is not only the best evidence available, but it was also tendered into evidence without objection, and I otherwise have no reason to question the veracity of same.
Accordingly, I find the value of Motor Vehicle 2 to be $19,000.
Value of the outbuilding and fittings at Town G
The parties have leased a site at Town G. On that site they have installed what has been described as an outbuilding, which photos show, is a substantial structure on a concrete foundation, including a bedroom, a plumbed in bathroom and air conditioning (“the outbuilding”).[10] The outbuilding has been independently valued at $40,000.[11]
[10] See Respondent’s exhibit R6.
[11] Affidavit of Mr L filed 1 April 2024, at page [28].
However, the husband’s evidence is that the outbuilding cannot be sold in situ, as the terms and conditions of the site provide that such a sale can only occur with the consent of the land owner.[12] His evidence was that the land owner would not agree to the sale of the site in its current state, as they are the only site that has such a set up. The husband conceded he may be able to sell the site if he put Motor Vehicle 4 on it and/or registered Motor Vehicle 4 which is currently on the site, however, both would involve significant expense. Motor Vehicle 4 for example would need a new motor, new tyres and was not waterproof. However, he also said that the owner’s preference is for all sites to upgraded with proper outbuildings. As such the owner required that the site be returned to its original condition at the end of the lease.
[12] See Respondent’s exhibit R16.
It was put to the husband that the outbuilding had a ‘degree of permanence’ about it, including the concrete slab and plumbing. However, the husband was clear that all the fixings could be removed and that the slab would otherwise have to be broken up.
I accept the husband’s evidence that in order to sell the site he would need to spend significant sums, and that even then there is no guarantee the owner would agree to the sale. I also accept that in the foreseeable future he intends to give up his lease to the site in Town G, as he intends to build on the Town C land and stay there instead. I further accept his evidence, which was largely unchallenged, that he would be unable to move the outbuilding as it is, given it is made of corrugated iron and that it would have to be dismantled. The husband’s evidence, which was also unchallenged was that dismantled outbuilding would be worth approximately $10,000.[13]
[13] Affidavit of Mr H filed 25 April 2024, at [54].
In final submissions, it was put that the husband has said this was the value after paying back Mr N for funds owed to him. I do not recall that being his evidence, however, if I am wrong, I am not satisfied that Mr N is owed funds from the build of the outbuilding.
The evidence appears to be that the husband and Mr N originally leased the site at Town G and built the outbuilding for the purposes of storing motor vehicles they owned together, which was cheaper than bringing it up and down from Melbourne. It appears that the husband and Mr N both worked on the outbuilding, and that Mr N purchased items for the outbuilding such as air conditioning as well as furniture. However, the evidence appeared to vary as to whether Mr N was a half owner of the outbuilding, or merely owed funds which he put into the build. In the husband’s trial affidavit he says, “[Mr N] and I agree that [Mr N] would own half the building out as he put in the materials and were sharing a place during holidays and weekends,”[14] however, at trial the evidence was asserted to be a debt.
[14] Affidavit of Mr H, at [53].
The wife believes that the understanding was that Mr N would be repaid for his time, by way of accommodation, as well as with beer and food. Although the wife’s evidence was problematic, this had a ring of truth about it. It seems however that upon Mr N having children, he did not in fact make as much use of the outbuilding as he had initially anticipated, and at some stage it may have been agreed that he would be paid back for some of his efforts instead. These efforts are however difficult to quantify in monetary terms. Mr N’s evidence did not assist in this regard. Indeed, his evidence generally was not very persuasive, and was not assisted by a number of inconsistencies between his oral evidence and affidavit, and his statement that he must not have read his affidavit properly.
Whilst Mr N had some bank statements which purported to evidence funds spent on fittings, he was at the same time a tradesperson. Whilst Mr N ultimately stated he did not believe he purchased the fittings for other jobs his evidence on that topic was less than convincing.
In any event, the husband’s evidence is that those works will shortly be deconstructed and removed from the site at the husband’s election. The air-conditioning unit, furniture, and other removable items contributed by Mr N could presumably be returned to him for resale or his own use to mitigate any losses.
Following the decision of Frederick, I accept the husband’s evidence as to the value of the outbuilding, and therefore, the true value of the outbuilding for the purposes of the asset pool will be $10,000.
Debt to Mr N –Motor Vehicle 3
The husband’s evidence is that he and Mr N purchased Motor Vehicle 3 together, contributing $20,000 each to the $40,000 purchase.
The wife disputes that Mr N contributed $20,000 to the purchase of Motor Vehicle 3. For reasons already stated, I have cause to doubt the veracity of the wife’s evidence in this matter. Furthermore, the husband’s evidence was corroborated by Mr N’s bank statements showing the transfer of the funds at the time.[15] I consequently accept that Mr N did indeed purchase a half interest in Motor Vehicle 3 with the husband.
[15] See Respondent’s exhibit R-17.
The motor vehicle has now been valued at only $20,000 as it needs significant work including a new motor. However, the husband asserts that Mr N is entitled to be repaid the entirety of his initial contribution of $20,000. Both the husband and Mr N gave evidence that they had an agreement that in the event Mr N was unable to use the motor vehicle, he would be repaid for the entire amount he put in and unfortunately, like the outbuilding, Mr N had not been able to make use of the motor vehicle, as he initially intended.
As already stated, I had some difficulties with Mr N’s evidence and the degree to which I could rely on same. In any event, it seems unlikely the husband would agree to repay Mr N in full for his initial contribution at any time he wished to be bought out, regardless of the value of the motor vehicle however even if he did, it does not seem just and equitable that the wife share the loss when she was not party to this agreement.
As it stands, the husband and Mr N purchased the motor vehicle together and are still co-owners. Half the value of the motor vehicle should therefore be included in the pool.
It is a matter for the husband if he indeed has a private agreement to repay Mr N and chooses to honour same.
Accordingly, I find the asset pool to be as follows:
| DESCRIPTION | TITLE | |||
| Value | ||||
| D Street Town E | DFW | 366,000 | ||
| Land at B Street, Town C (sworn) | Joint | 380,000 | ||
| Part property settlements paid out to Applicant | 139,119 | Joint | 139,119 | |
| Funds held on trust by Applicant solicitor | 167,689 | Joint | 167,688 | |
| Part property settlements paid out to Respondent | 139,408 | Joint | 139,408 | |
| Funds held on trust by Respondent solicitor | 167,400 | Joint | 167,400 | |
| Motor Vehicle 1 (DFW) | 100% | 5000 | ||
| Motor Vehicle 2 (DFH) | 100% | 19000 | ||
| Net value of Outbuilding and fittings at Town G | Dispute | 10,000 | ||
| Motor Vehicle 3 (single expert value $20,000) | DFH | 10,000 | ||
| Motor Vehicle 4 at Town G | DFH | 10,000 | ||
| Motor Vehicle 5 (single expert value: $5,000) | DFH ½ | 2,500 | ||
| Motorcycle (DFH) | 100% | 1,500 | ||
| Motor Vehicle 6 and equipment | DFH | 500 | ||
| Motor Vehicle 7 (single expert value: $2,000) | DFH 1/3 | 667 | ||
| Commonwealth Bank Smart Access | DFH | Nominal | ||
| GROSS ASSETS | ||||
| Mortgage – Town C | Joint | (151,062) | ||
| Rates – Town C | Joint | (3,585) | ||
| Body corporate fees owing – Town C | Joint | (6,684) | ||
| Liabilities subtotal | ||||
| NET CURRENT ASSETS | $1,257,452 | |||
| Percentile distribution | ||||
| SUPERANNUATION | ||||
| FUND | ||||
| Applicant’s Super Fund 2 interest (not updated since 30.6.23) | 39,030 | |||
| Respondent’s Super Fund 1 interest | 108,024 | |||
| Base amount adjustment | ||||
| Superannuation total | 147,054 | |||
CONTRIBUTIONS
In determining what orders are to be made pursuant to s 90SM of the Act, the leading cases predominantly concern s 79 of the Act which covers parties who are married. The principles are applicable to both sections.
The approach of the court when assessing contributions was set out in Aleksovski & Aleksovski [1996] FamCA 111 ("Aleksovski") at [55] in which it was stated the court must:
…weigh and assess the contributions of all kinds and from all sources made by each of the parties throughout the period of their cohabitation and then translate such assessment into a percentage of the overall property of the parties or provide for a transfer of property in specie in accordance with that assessment.
Pursuant to the High Court case of Mallet v Mallet [1984] HCA 21; there is no presumption of equality of division of property, not even in a long relationship, and in each case the contributions of each party must be assessed on their own facts.
In Aleksovski at [83,443] his Honour Kay J said:
The Judge must weigh up various areas of contribution. In a short marriage, significant weight might be given to a large capital contribution. In a long marriage, other factors often assume great significance and ought not be left almost unseen by eyes dazzled by the magnitude of recently acquired capital… What is important is to somehow give a reasonable value to all of the elements that go to making up the entirety of the marriage relationship.
(emphasis added)
Those observations were quoted with approval by the Full Court in Dickons & Dickons [2012] FamCAFC 154 ("Dickons"). In that case, their Honours, Bryant CJ, Faulks and Murphy JJ said that "…the requirements of the section are met by approaching the assessment of contributions holistically…"[16] by analysing the contributions of all types, and by reference to the particular circumstances of that particular relationship.
[16] Dickons & Dickons [2012] FamCAFC 154 at [21].
The assessment of contributions does not require "over-zealous" attention to the ascertainment of contributions, and the process of the court as required by s 79 of the Act "…is the exercise of a wide discretion, not the performance of a mathematical or accounting exercise" as set out in Dickons at [25].
In determining any application for property settlement, the court is not embarking upon an arithmetical exercise but rather an examination of all the relevant factors set out in s 90SM(4). As noted by the Full Court in D & D:[17]
… the task of the court in proceedings under s 79 is not akin to an accounting exercise. The task is to examine the facts of each case carefully to decide what is appropriate and just and equitable in the circumstances. There cannot be expected to be a universal answer to that question on any given set of facts. It is of the essence of judicial discretion that different minds may comfortably arrive at different conclusions.
[17] [2003] FamCA 473 at [49].
Initial
At the commencement of the relationship, the wife had no assets of significance.
In regard to the husband, the wife ultimately conceded in her evidence that the husband brought into the relationship two properties, the Town U property and a property at BB Street, Suburb CC, (“the BB Street property”) as well as two work vehicles, and approximately $33,000 in superannuation.[18]
[18] Noting this was the balance in 2006 being about two years prior to the relationship.
The wife ultimately accepted under cross-examination that the Town U property was sold in 2013 for approximately $95,000 and that that amount was likely applied to reduce the mortgage over the BB Street property. She also conceded that the BB Street property was sold in late 2014 for $400,000 with a mortgage of $146,000, resulting in a net profit of approximately $254,000. This in turn was applied to purchase the home at Q Street, Suburb CC (“the Q Street property”). The Q Street property was eventually sold in late 2021 with the proceeds of sale being approximately $615,000.
Although there is no evidence of the precise equity in the two properties owned by the husband at the commencement of the relationship, it is evident the ultimate profits provided a springboard to enable the parties to purchase Q Street and was a significant contribution on his behalf.
During
In terms of the parties’ contributions during the relationship, it appears that the husband was the primary income earner and the wife the primary carer of the children, although she also assisted with administration in the husband’s business.
It is not in dispute that the wife developed an alcohol use disorder and began attending Alcoholics Anonymous in or about early 2021. The husband says that at this time he took over the care of the children and the household to assist the wife with her recovery. Under cross-examination, he said this was for a period of about three months. It was argued, however, that her functioning must also have been affected in the lead up to this period. I do not accept that as being the case in every situation. It is well known that there are many high functioning alcoholics. Nonetheless, I accept the husband to his credit, made a greater contribution at around the time of the wife’s recovery. Otherwise, I find that each party contributed to best of their abilities.
In regard to the Town E property, the husband’s evidence is that he made contributions by way of both labour and materials, including installing split-system air conditioners, a water heater, a wall furnace, a stove, and a range hood, and that he had to run gas and plumbing lines to accomplish this.
He estimates the value of his contribution to be about $15,000, although under cross-examination, he conceded he was unsure if the wife was reimbursed for the cost of some of these items. The husband says further that he did this work on the “understanding that the property would come to our family upon her [the wife’s] father’s passing”.[19] However, he does not however elaborate on what basis he formed this “understanding”.
[19] Affidavit of Mr H filed 25 April 2024 at [39] - [41].
The wife denied that the husband had completed any of these works, however her evidence was unreliable for reasons already stated, and the husband’s evidence had a ring of truth about it:
It is well accepted that where evidence is uncontradicted and is not otherwise inherently improbable or inherently incredible, and where the other party has not elicited in cross-examination or led in evidence some material to overcome it, either by proving the contrary or throwing the matter into doubt, it should be accepted.[20]
[20] Bain & Bain (deceased) [2017] FamCAFC 80 at [112] quoting Purkess v Crittenden (1965) 114 CLR 164 and Ellis v Wallsend District Hospital (1989) 17 NSWLR 553 at 561 per Kirby P.
Accordingly, I accept the contributions to the Town E property as asserted by the husband. However, I find that overall, the wife’s inherited interest in the Town E property is a substantial contribution on behalf of the wife.
Post separation
It is not in dispute that the husband has been the primary carer of the children since separation, that the wife has spent only limited time since October 2023 and no time between Boxing Day 2023 and the weekend before trial.
It is also not contentious that the wife has paid no child support apart from one public school enrolment.
The husband has, therefore, predominantly met the costs of the children including orthodontics for X as well as being responsible for the children’s day to day care. Given it has been some 2 and a half years since separation, this is a substantial contribution on his behalf.
Assessment of contributions
The Full Court in Jabour & Jabour [2019] FamCAFC 78 warns the court not to weigh up one particular contribution, such as a property brought into a relationship against other contributions made during a relationship. Rather the approach to be taken is to assess all of the “myriad” of contributions, including initial and post-separation contributions. Having assessed all of the contributions in this case, including the springboard provided by the husband’s properties, the property inherited by the wife and the husband’s post-separation contributions, I find that the contributions slightly favour the husband, who shall receive an adjustment in his favour of 5%.
SECTION 90SF FACTORS
The husband’s case is that he is 8 years older than the wife and due to his age and long history of working as a tradesperson, that he has a limited life working in that capacity. Although I note that at 51 years or thereabouts, the husband does not yet have one foot in the grave. I accept that the physicality of the job, such as crawling in tight spaces, is likely to become progressively more difficult over time. As I have noted, although the husband has provided a number of medical records in support of various ailments which I have allowed into evidence, as their makers are unavailable for cross-examination, I do not propose to give that evidence any weight.
The wife does not accept that the husband could not work as a tradesperson if he so chose to do so, and therefore, is capable of earning a higher income. She also did not concede that the decision to move to Town C was about the husband’s deteriorating body but rather that it was about traffic and work and life balance.
In regard to the wife, who currently works part-time as a labourer, she gave evidence she intends to increase her work to fulltime hours. The wife earns $40 per hour which would equate to $1,600 per week, whilst the husband earns $1,355 in his current position with K Company. Furthermore, the wife gave evidence that she was intending on continuing a certificate at TAFE which would ultimately enable her to work as an allied health worker, where she would expect to earn between $45 and $60 per hour.
However, regardless of the husband’s health, I accept that it is not unreasonable for the husband to have taken a regular salaried position given the need to be available for the children. This has however, resulted in a lower earning capacity and given the youngest child is only 13 years of age, it is unlikely that this will change for some years to come, and equally unlikely that the husband will be assisted by any meaningful child support in that time.
Although the final parenting orders provide for the possibility of the wife moving to Town C, and that if she did so, she could spend more frequent time with the children which would potentially relieve some of the parenting responsibility from the husband, there was no evidence that the wife intended on doing so.
In any event, the wife’s counsel conceded in closing submissions that the husband should receive between 8 and 10 percent adjustment in his favour for his future needs.
Taking into account all of the above matters, I agree that the husband should receive an adjustment of eight percent, which would result in an overall adjustment of the non-superannuation pool of 63 per cent in his favour.
DETERMINATION
Based on the above assessment, the husband would be entitled to the following:
I have assessed the total non-superannuation asset pool to be $1,257,452 and 63 per cent of that pool is $792,194.
If the husband retains all of the items in his possession plus the funds held on trust, he retains $747,332 which would require the wife to pay a further $44,862. However, it was conceded for the husband in final submissions that to achieve any additional payment from the wife would require the wife to sell her interest in the Town E property, and the husband was not pressing for this. On this basis he sought only the balance of the trust funds, albeit the percentage division in his favour, it would be less.
In Clauson & Clauson (1995) FLR 92 the Full Court was clear that the court must stand back and consider the division in monetary terms when assessing whether the adjustment is just and equitable.
Given the husband’s concession, and that it will enable the wife to retain her interest in a real property which will likely assist her to remain in the property market into the future, I accept the orders proposed by the husband are those that are just and equitable in all of the circumstances of this case.
In regard to the superannuation, it was agreed that the court should take a two pool approach given the parties’ ages and that the superannuation should be equalised. Having been provided with proof of service of the proposed orders on the superannuation fund, I am content to make those orders.
Otherwise, the parties presented the court with an agreed form of orders, other than the division of the funds held on trust, and I shall accordingly make those orders by consent.
COSTS OF ATTENDANCE AT COURT OF MS S
Ms S was subpoenaed by the husband to attend court to give evidence. At the conclusion of her evidence, Ms S sought her costs of attendance at court for a half day attendance.
Ms S was in attendance at court on 23 April 2024 from about 10:00 am (in answer to the subpoena) until she finished her evidence shortly before 12:30 pm.
The husband argued that a cost order was not appropriate as Ms S’s attendance was required due to an inconsistency between an email that she sent to the husband’s solicitors and documents she ultimately produced in answer to another subpoena.[21]
[21] Subpoena issued to Ms S of S Law Firm filed 15 April 2024.
The email in question was sent on 16 April 2024 in which she said in part:
I am incredibly perplexed by your Subpoena. I can confirm that I have not acted in relation to the Probate nor distribution of the estate of the late [Mr DD], and nor have I conducted any conveyancing works in relation to the [Town E] property that you refer to.
Accordingly, the only documents I can offer are the Will of the late [Mr DD], and the title to the [Town E] property, both of which have previously been provided to you. The property is jointly owned by the three children of [Mr DD] and I am not aware of any documents or information that suggest otherwise.
The controversy is that Ms S ultimately produced a more extensive set of documents than she indicated in the email, including correspondence already referred to in this judgment between her firm and the wife’s brother, Mr H.
The husband sought to subpoena Ms S to answer questions about those negotiations but ultimately her oral evidence took the matter no further. Despite attempts to question her integrity, it was apparent that Ms S provided all of the documents, including correspondence she had in her possession in answer to the original subpoena. Furthermore, having heard her evidence, I do not accept that Ms S was otherwise motivated by her distant family connection to the wife, or because she acted briefly for the wife in her family law proceedings, to hide the negotiations with Mr H or to otherwise delay the ongoing negotiations with Mr H until after these family law proceedings.
Ms S was very forthright in her evidence, which was essentially unshaken. I have no reason to doubt the veracity of same.
It is entirely probable that the wife contacted a law firm because of the connection with her distant relative, but that the issue of the estate was handled by another employee of that firm. Otherwise, I accept that Ms S initially acted for the wife in her family law matter but given the passage of time could not recall the precise timeline of what occurred. Whilst Ms S should arguably have included the correspondence with Mr H in the wife’s original affidavit, it appears she either did not know about it at the time or dismissed it as irrelevant as the negotiations were going “nowhere.”
In the end, little was gained from Ms S’s oral evidence, which merely served to corroborate the wife’s case.
I do not accept the submission that had the wife signed the authority provided to her, then Ms S’s attendance could have been avoided as the husband’s counsel clearly wished to challenge her bona fides under cross-examination.[22]
[22] See Authority in Respondent’s exhibit R8 at [6] – [7].
As it was the husband that required Ms S’s attendance, he ought to pay her costs. In assessing costs of a witness, I have the discretion to order reasonable costs pursuant to the Rules, including conduct money provided it exceeds $25.[23] In this case, whilst the scale provides for a witness, other than an expert, to receive $75,[24] I do not accept this would be reasonable in all of the circumstances of the case, in particular because her evidence did not advance the husband’s case.
[23] See Schedule 2 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (“the Rules”) at item 101.
[24] The Rules Schedule 2 at item 201.
Ms S’s costs were $440 per hour, being a total of $1,100 for the two and a half hours she was at court. Although she may have been able to do some work whilst waiting to give evidence to offset her losses, I have not included an amount for her travel or her time travelling. Taking all of this into consideration, I find $1,100 to be the reasonable cost of Ms S’s attendance at court. This amount shall be released to Ms S from the funds held in her firm’s trust account prior to the husband receiving the balance.
Finally, I presume, although the husband has been largely successful in his application, that given the concessions made as to the wife’s capacity to make any further payment that he will not be seeking costs against her however if I am wrong, he has the ability to bring an application pursuant to Rule 12.13(3) of the Rules.
For the aforementioned reasons I make the orders as set out at the commencement of this judgment.
I certify that the preceding one hundred and ten (110) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Jenkins. Associate:
Dated: 19 July 2024
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