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Aitken and Murphy

Aitken and Murphy

Case [2013] FamCA 3 15 January 2013

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FAMILY COURT OF AUSTRALIA

AITKEN & MURPHY

[2013] FamCA 3

FAMILY LAW – PROPERTY – De Facto – Short relationship – Large asset pool – Significant initial financial contribution by Respondent – Applicant’s non-financial contributions during relationship, including homemaker contributions - Methodology to be adopted for valuation of Respondent’s successful business – Fair market value or value to owner – Applicant’s entitlement to a certificate pursuant to s 128 of the Evidence Act – Applicant’s involvement with allegedly fraudulent activities – Supreme Court judgment debt against Applicant – Supreme Court Freezing Order – Whether Supreme Court judgment debt be included in the asset pool available for distribution – Appropriate date to value asset pool – Whether real property purchased by the Respondent post-separation be included in the asset pool – Whether the Applicant’s taxation liability accrued post-separation, but for monies earnt during the relationship, be included in the asset pool – Responsibility for interest and penalties on Applicant’s taxation debt – Applicant currently unemployed – Respondent’s higher income and future earning capacity – Appropriate s 90SF(3) adjustment – Whether the Applicant’s legal advisors have a priority right to payment from any lump sum received by the Applicant.

Family Law Act 1975 (Cth) ss 90SM, 90SF
Evidence Act 1995 (Cth) s 128

AJW v JMW (2002) FLC 93-103

Australian Securities & Investments Commission v Rich [2003] FamCA 1114
Harrison & Harrison (1996) FLC 92-682
Douglas & Douglas (2006) FLC 93-300
Figgins & Figgins (2002) FLC 93-122
GBT v BJT [2005] FamCA 683
Goodwin and Goodwin (1991) FLC 92-192
Lane and Wharton [2010] FamCA 18

Martin & Newton (2011) FLC 93-490

Reynolds & Reynolds (1985) FLC 91-632

Scott and Scott [2006] FamCA 1379

Smith & Fields [2012] FamCA 510

Taylor and Taylor and Taylor [2000] FamCA 308

Turnbull & Turnbull (1991) FLC 92-258
Twigg v Keady (1996) FLC 21-721

APPLICANT:

Mr Aitken

RESPONDENT:

Mr Murphy

FILE NUMBER:

MLC

11907

2010

DATE DELIVERED:

15 January 2013

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

Young J

HEARING DATE:

29, 30, 31 October 2012 and 1 November 2012

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Ackman QC with him Mr Werner

SOLICITOR FOR THE APPLICANT:

Barbayannis Lawyers

COUNSEL FOR THE RESPONDENT:

Mr North SC with him Ms Smallwood

SOLICITOR FOR THE RESPONDENT:

T J Mulvany & Co

INDEX

ORDERS

ISSUES

ORDERS SOUGHT

AFFIDAVITS RELIED UPON

PREVIOUS COURT ORDERS

BACKGROUND FACTS

DATE OF COMMENCEMENT OF RELATIONSHIP

AGREED ASSET POOL

FINANCIAL ISSUES IN DISPUTE

R PTY LTD – SUPREME COURT ORDERS

S 128 CERTIFICATES

STANDARD OF PROOF

OBSERVATION OF PARTIES AND WITNESSES

FAMILY LAW ACT 1975 (CTH) (“THE ACT”)

SECTION 90SF (1), (2) AND (3)

RESPONDENT’S EARLIER PROPERTY ACQUISITIONS

N STREET MELBOURNE SUBURB 1 (“N STREET”)

P STREET MELBOURNE SUBURB 3 (“P STREET)

O STREET MELBOURNE SUBURB 1 (“O STREET”)

3 UNITS AT S STREET MELBOURNE SUBURB 4 (“S STREET”)

D STREET MELBOURNE SUBURB 1 (“D STREET”)

C STREET SYDNEY SUBURB 1 (“SYDNEY SUBURB 1”)

K STREET MELBOURNE SUBURB 3 (“K STREET”)

PARTIES’ PROPERTY /…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Aitken and Murphy

Details

AGLC: Aitken and Murphy [2013] FamCA 3
Case: [2013] FamCA 3
Decision Date

CaseChat Overview and Summary

The Family Court of Australia, in the matter of Aitken & Murphy, was tasked with determining a just and equitable property settlement between the Applicant, Mr Aitken, and the Respondent, Mr Murphy. The dispute arose from a de facto relationship of short duration, characterised by a significant disparity in the parties' initial financial contributions, income, and assets. The Respondent had made substantial initial financial contributions, while the Applicant's contributions were primarily non-financial, including homemaker duties.

The court was required to address several complex legal issues. These included the methodology for valuing the Respondent's successful business, specifically whether to adopt fair market value or value to the owner. Further issues concerned the inclusion of a Supreme Court judgment debt and freezing order against the Applicant in the asset pool, the appropriate date for valuing the asset pool, and whether real property acquired by the Respondent post-separation should be included. The court also had to consider the Applicant's taxation liability accrued during the relationship but assessed post-separation, including responsibility for interest and penalties, the Applicant's current unemployment, the Respondent's higher income and future earning capacity, and the appropriate adjustment under s 90SF(3) of the Family Law Act 1975 (Cth). Finally, the court needed to determine if the Applicant's legal advisors had a priority right to payment from any lump sum received by the Applicant.

In its reasoning, the court considered the principles governing short-term de facto relationships and the division of a large asset pool with significant initial contributions from one party. The court applied the provisions of the Family Law Act 1975, particularly sections 90SM and 90SF, to assess the contributions and future needs of each party. The court's determination involved a careful balancing of financial and non-financial contributions, the impact of post-separation acquisitions and liabilities, and the overall just and equitable outcome for both parties. The court also addressed the Applicant's entitlement to a certificate under s 128 of the Evidence Act 1995 in light of his alleged involvement in fraudulent activities and a Supreme Court judgment debt.

The court ordered the Respondent to pay a lump sum of $769,893 within sixty days. This payment was to be allocated strictly in a specified order, prioritising legal costs for the Applicant and the discharge of Supreme Court freezing orders, with the balance to be paid to the Applicant's solicitors on trust. In default of payment, the Respondent was to offer for sale a property known as D Street, Melbourne Suburb 1, to satisfy the outstanding amount. The Respondent was also ordered to transfer a BMW motor vehicle to the Applicant within fourteen days. Otherwise, each party was to retain their existing property and remain responsible for their own debts and liabilities. All extant applications for maintenance were dismissed.

Orders