Al-Sadikh and Al-Sadikh
[2007] FamCA 716
•17 July 2007
FAMILY COURT OF AUSTRALIA
| AL-SADIKH & Al-SADIKH | [2007] FamCA 716 |
| FAMILY LAW - PROPERTY SETTLEMENT – Identification of assets – Contribution - Other Matters |
| Family Law Act 1975 (Cth) Sections 75 & 79 |
In the Marriage of Hickey (2003) 30 Fam LR 355
In the Marriage of Coghlan (2004) 33 Fam LR 414
In the Marriage of Omacini (2005) 33 Fam LR 134
In the Marriage of Lenehan (1987) 11 Fam LR 615
In the Marriage of Norbis (1986) 10 Fam LR 819; FLC 91-712
In the Marriage of Zyk (1995) 19 Fam LR 797
Mallett v Mallett (1984) 9 Fam LR 449
In the Marriage of Ferraro (1992) 16 Fam LR 1
In the Marriage of Shewring (1987) l2 Fam LR 139
In the Marriage of Pierce (1998) 24 Fam LR 377
| APPLICANT: | Mrs Al-Sadikh |
| RESPONDENT: | Mr Al-Sadikh |
| FILE NUMBER: | SYF | 2585 | of | 2005 |
| DATE DELIVERED: | 17 July 2007 |
| PLACE DELIVERED: | Sydney |
PLACE HEARD | Sydney |
| JUDGMENT OF: | Judicial Registrar Loughnan |
| HEARING DATE: | 28 & 29 June 2007 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Freidlander |
| SOLICITOR FOR THE APPLICANT: | J Kartsounis & Company |
| COUNSEL FOR THE RESPONDENT: | Ms Langley |
| SOLICITOR FOR THE RESPONDENT: | Uther Webster & Evans |
Orders
1.That within 28 days the husband do all things and execute all documents necessary to cause his right title and interest in the property known as and situate at C (Volume … FL …) to be transferred to the wife.
2.That forthwith upon that transfer the wife pay to the husband the sum of $11,500.
3.That other than as specified above, each party be solely entitled to the exclusion of the other to all property and chattels of whatsoever nature and kind in the possession of such party at the date of these orders and that for this purpose, bank accounts are deemed to be in the possession of the person whose name appears on the bank record thereof, insurance policies are deemed to be the possession of the beneficiary thereof, declared superannuation entitlements are deemed to be in the possession of the person whose circumstances provide the conditions for payment out of such entitlement.
4.The husband’s passport be released to him by the Registry Manager of the Family Court of Australia at Sydney.
5.That in the event that either party refuses or neglects to execute any deed or instrument then a Registrar of this Honourable Court be empowered pursuant to section 106A of the Family Law Act to execute such deed or instrument and do all acts necessary to give validity to the deed or instrument.
6.Liberty to restore this matter to the list on 48 hours notice for further implementation of these orders.
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYF 2585 of 2005
| Mrs Al-Sadikh |
Applicant
And
| Mr Al-Sadikh |
Respondent
REASONS FOR JUDGMENT
The parties were married over 33 years ago and cannot agree on a settlement of their property.
Applications
By her amended Application for Final Orders filed on 26 June 2007 the wife seeks:
1.That within 28 days the husband do all thinks and execute all documents to cause his right title and interest in the property known as and situate at [C property] (Volume […] FL […]) to be transferred to the wife.
2.That within 28 days of these orders the husband pay to the wife the sum of $250.0000.00.
3.That upon the husband’s compliance with orders 1 and 2 hereof the husband be declared the sole owner in law and equity of the real estate property located in [F], Lebanon.
4.That other than as specified above, each party be solely entitled to the exclusion of the other to all property and chattels of whatsoever nature and kind in the possession of such party at the date of these orders and that for this purpose, bank accounts are deemed to be in the possession of the person whose name appears on the bank record thereof, insurance policies are deemed to be the possession of the beneficiary thereof, declared superannuation entitlements are deemed to be in the possession of the person who is named as the worker whose age or working future provides the conditions for payment out of such entitlement.
5.That in the event that either party refuses or neglects to execute any deed or instrument then a Registrar of this Honourable Court be empowered pursuant to section 106A of the Family Law Act to execute such deed or instrument and do all acts necessary to give validity to the deed or instrument.
6.Liberty to restore this matter to the list on 48 hours notice for further implementation of these orders.
7.The husband be restrained from departing from Australia until compliance with orders 1 and 2 hereof.
8.The husband’s passport be retained at the Registry of the Family Court of Australia at Sydney until compliance by the husband with orders 1 and 2 hereof.
By his amended Response filed 20 April 2007 the husband seeks:
2.That within forty-two (42) days of the date of the Order, the husband do all acts and things and sign all documents necessary to transfer to the wife all his right, title and interest in the property at [C] (“the [C] property”) and contained in Folio Identifier […].
3.That simultaneously with the Transfer referred to in Order 2 above (“the due date”), the wife do all acts and things and sign all documents necessary to pay to the husband the sum of $260,000.00 (“the settlement sum”).
4.That in the event that the wife fails to pay the settlement sum by the due date, then interest shall accrue on the settlement sum from the due date to the date of payment at the rate of 10% per annum.
5.That in the event that the wife fails to pay the settlement sum within twenty one (21) days of the due date, then the parties are to do all acts and things and sign all documents necessary to forthwith list the for sale the [C] property on the following terms and conditions:
(a)with an Agent as agreed between the parties, failing agreement within twelve (12) days of the due date, with an Agent appointed on the application by either of them by the President of the Real Estate Institute of New South Wales, or his nominee (“the agent”);
(b)At a price agreed between the parties, failing agreement within twenty eight (28) days of the due date, at a price fixed to be a fair market price value of the [C] property by the Agent;
(c)The wife to meet the costs associated with marketing the property and readying it for sale;
(d)Should the parties be unable to sell the [C] property for the price referred to in order 5(b) above, then the parties shall sell the [C] property for the highest offer that has been made in respect of the property, or the highest price that the Agent shall be able to obtain for the said property, and shall execute contract for sale based upon that offer.
6.That upon completion of the said sale, the parties shall, after adjustment for municipal council rates and metropolitan water sewerage and drainage board rates, distribute the proceeds of sale as follows:
(a)in payment of real estate agent’s commission and legal costs on sale;
(b)in payment to the husband of the settlement sum plus any interest accrued in accordance with order 4 above;
(c)in payment to the wife of the balance then remaining.
7.That unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or subsequent orders:
a)That each party be solely entitled to the exclusion of the other to all property, including superannuation entitlements, savings, contents of bank accounts, business interests and personal items in the possession, custody and control of such party as at the date of these orders;
b)Each party be solely liable for and indemnify the other against any liability they may have as at the date of these orders
8.That in the event that the Husband or Wife refuses or neglects to comply with any of the provisions of these Orders within 7 days of a document being forwarded to either of them for their completion, a Deputy Registrar or a Registrar or other Officer of the Family Court of Australia at Sydney be appointed pursuant to Section 106A (1) of the Act, to execute all such deeds and documents in the name of the defaulting party and to do all acts and things necessary to give validity to the said Orders.
9.That the Registrar or Deputy Registrar or other Officer is authorised to execute any such necessary instrument upon being satisfied by Affidavit that refusal, neglect or default as the case may be, has occurred.
10.That the wife pay the Husband’s costs of and incidental to these proceedings.
Issues for determination
The issues for determination as settled by counsel are:
§The parties’ inheritances including the state of the Lebanese property at marriage;
§The assets and amount the husband has in accounts in Lebanon;
§The husband’s alleged non-disclosure;
§The extent, if any, of the husband’s contributions from his family in Lebanon and the adult children;
§The parties respective contributions as to wage earnings, parenting and homemaking;
§The contributions of by the parties to the real estate in Lebanon;
§The capacity of the parties for future employment;
§The future needs of the parties;
§The parties’ failure to comply with previous orders.
Short History
The wife and husband are 51 and 60 years of age respectively. They were married on 7 January 1974 and separated in either 1999 or on 13 March 2002.
Children
There are five surviving children of the marriage:
Hwho was born in January 1976 and as at the date of the hearing he is 31 years of age;
Mwho was born in July 1977 and as at the date of the hearing she is 29 years of age;
Uwho was born in September 1979 and as at the date of the hearing he is 27 years of age;
Rwho was born in January 1981 and as at the date of the hearing she is 26 years of age;
Owho was born in August 1994 and as at the date of the hearing he is 12 years of age;
Background Facts
The husband was born in Lebanon and migrated to Australia in 1970.
The husband returned to Lebanon and on 7 January 1974 the parties were married and started to live together. The wife had no significant assets. The husband owned a block of land at F (the name of the town is spelled in various ways in the parties’ documents), a holiday destination in northern Lebanon. It was land inherited from his father who had died in about 1972. The husband contends that work had commenced on a building on the land by 1974. The wife says it was a vacant block and indeed she assisted with the task of clearing trees from it in 1974. Nothing turns on this issue.
In May 1974 the parties migrated to Australia. The husband commenced working at a factory at P. He later worked as a taxi-driver and labourer and a process worker in factories. The wife worked as a full-time process worker at N factory. The wife sent some money home to her relatives in Lebanon – a few payments of $100, $150 and $200. The husband managed the family finances.
In 1974 or around 1976/1977 the husband injured himself at work. The wife says that he was off work for 12 months and that she took care of him, took him to doctors’ appointments and was the sole breadwinner for 12 months.
In 1975 or sometime later the husband received approximately $8,000.00 to $10,000.00 in a workers’ compensation payout, which he used towards the construction of the block of units on the land in Lebanon. The wife alleges and that husband denies that from 1974 until 1981 the husband sent various sums of money to Lebanon for the construction.
In 1975 the wife commenced working as a full-time process worker at the S factory, working 12 hour shifts 4am to 4pm five days per week.
H was born in January 1976. The wife says she took one month maternity leave and returned to 12 hour shifts at S factory. The husband contends that the wife only had paid employment for about 18 months in total.
In 1976 the husband commenced working at the D Factory as a process worker.
M was born in July 1977. The wife says she took two months’ maternity leave and returned to 12 hour shifts.
The wife says that in March 1978 she left S Factory and thereafter stayed at home to take care of the children.
In 1978 the husband started a small business. The wife took phone bookings and looked up addresses to assist in the business.
U was born in September 1979.
In 1980 the husband commenced working as a taxi-driver. The parties opened a number of bank accounts in Lebanon over the course of the marriage. The wife alleges that the husband subsequently changed bank accounts that had been in joint names into his own name.
In 1981 the block of units at F comprising three or five storeys and five units, was completed and from time to time units were rented out. As to the rental income the wife says that the husband received $US5,300.00 per annum which he accumulated in Lebanese bank accounts. The husband says that the units were not all rented all of the time, and that the rental, particularly in later years was barely sufficient to cover the costs of maintenance and of the managing agent.
R was born in January 1981.
In 1984 the parties purchased a home at C for $57.000 using $18,000 borrowed from the Commonwealth Bank. The parties received the First Home Buyers grant and applied savings to the purchase. The home is now worth $650,000.
A child, J was born in 1987.
The husband retired from work as a labourer in 1988. Since then and up to the date of the hearing, he has driven a taxi cab on a casual basis, one or two days a week.
In 1991 the wife received an inheritance from her father’s estate of $64,000.00, which was used for renovations to the C property. The wife’s cousins, brother, uncle and nephew assisted with the renovations. The configuration of the property is a top storey with four bedrooms, a ground floor with two bedrooms (sometimes rented out as a flat) and a separate granny flat.
In 1992 the child J was diagnosed with muscular dystrophy. He was then 5 years old. He was confined to a wheelchair and required help with things such as eating, dressing, washing, going to the toilet and attending specialists’ appointments. The wife was his primary caregiver, assisted by the other children. The husband contends that he assisted with much of this work.
O was born in August 1994.
In either 1999 or 2001 the wife suffered head and spinal injuries in a car accident leaving her disabled and with ongoing symptoms of dizziness, migraine, extreme back and shoulder pain and depression.
The husband says that the parties separated in 1999 when he moved into a separate bedroom.
From time to time the ground floor was rented out. The last tenant paid either $150 or $200 per week and left the premises at the insistence of the wife. He may have left in April 2006.
In 2002 the wife underwent an operation on her skull to release build-up of fluid and three operations to unblock her nose. The wife continues to attend physiotherapy and a psychologist.
The husband travelled overseas to return to Lebanon and to attend the Hajj. That was probably in late 2002. He moved into the granny flat at the rear of the C property either just before that trip or on his return. The wife says that the parties separated on 16 March 2002.
Thereafter the wife paid all outgoings on the C property from her income comprising the pension and family allowance. The two older children provided financial assistance when necessary. The husband paid $5.00 per week child support.
Sadly, J died in June 2003.
These proceedings were commenced by the wife on 21 March 2005.
On 19 April 2005 orders were made by this Court restraining the husband from leaving Australia.
In June/July 2005 the wife’s compensation claim was settled and in either 2005 or September 2006 she received $299,494.25 being the net compensation payout for her injuries.
On 27 October 2006 the wife invested $200,000 in a superannuation fund with T superannuation. The wife’s interest in the fund is an accumulation interest in the growth phase. As at 14 June 2007 the value of the interest was $224,756.55.
Credit and Submissions
The evidence of the witnesses
The only witnesses called for cross-examination were the parties.
The wife is a poor witness. Firstly, English is not her first language and she gave her evidence through an interpreter. Her written evidence was read over to her in her own language at the time of execution but of course she can only attest to the accuracy of what she was told she was signing. Although there is no endorsement on the jurats, Mr N, an accredited translator translated the wife’s latest Financial Statement and her updating affidavit into Arabic for her and she appeared to understand the contents. The wife has not read over her various sworn documents since she signed them. Further, it is her evidence that the husband managed the financial affairs of the family and therefore she does not have a first hand knowledge of much of those affairs. Finally, when pressed on the completeness of her written evidence she said that she has headaches and a poor memory and I take it that she would say those things arise from the injuries caused during a serous car accident. The combination of those factors has a disastrous effect on the reliability of her evidence.
As an example of the problems, the wife’s written evidence traces her paid employment in Australia from her arrival in 1974 to February or March 1978. The latter period she says involved process work at S Factory and was broken by two short periods of maternity leave at the time of the births of H and M. It was put to her in cross-examination that her paid employment was for only 18 months or so after her arrival. The wife conceded that in an earlier affidavit she had deposed to working for only 2 years. In answering questions about this in cross-examination the wife said, among other things, words to the effect that she had worked for 3 or 4 years until the children came along. H “came along” in 1976. I do not think it matters whether the wife worked for 18 months or 4 years but the wife is not a reliable witness.
The wife could not account for the disparity in her evidence about the timing of receipt by her of the compensation payment. She says she received the payment of $299,500 odd in 2005 and that she paid it into her only bank account fairly soon after receiving it. Supporting the evidence of the receipt of the compensation moneys in 2005 is the fact that the wife bought bedroom furniture for $7,000 in October 2005. However, her bank book shows that a cheque in the sum of $299,494.25 was deposited on 15 September 2006. I suggested that given the compensation proceedings were settled in June/July 2005[1] perhaps the money had been invested by her for a year. That was not taken up and no effort was made to explain correct this problem in re-examination. Again the issue itself is not very important but highlights the problems of resolving factual disputes in the case.
[1] The copy of terms of settlement annexed to the wife’s affidavit of August 2006 bears stamps suggesting that judgment was entered either on 28 June or 2 July 2005
The husband was a very poor witness. As with the wife, the husband gave his oral evidence through an interpreter and although there is no reference on the jurats, it appears that his written evidence was read over to him in Arabic before he executed the relevant documents. The husband works as a taxi driver and must have some facility in English. During the hearing he took the affirmation without the assistance of the interpreter and answered some questions in English. Unfortunately, in the course of his cross-examination he repudiated much of his written evidence with “that is a lie” or some similar phrase. When tested about the funds in Lebanon he appeared to become frustrated and responded on several occasions with words to the effect that “if there are additional moneys then the wife can have them”. When asked about a withdrawal of $10,300 from a bank account in 2005 the husband said that he had gambled that money. When asked about a withdrawal of $9,500 on 22 December 2005 he said that he had gambled that money. A few minutes later when trying to account for the repayment of $15,000 to his son he said that the same $9,500 was repaid to his son. The evidence about gambling was the first mention of gambling as far as I am aware, in any evidence in the proceedings. The evidence has credibility because it reflects a concession against interest but because there is no reference to that issue in the husband’s evidence in chief and because the wife apparently does not accept the evidence, there is a risk that it is not true. The husband has no real recollection of dates and appeared to have a very poor memory.
It is not possible to simply prefer the evidence of one party over that of the other. There is little by way of corroborative evidence. That means that it is not possible to make findings of fact about many relevant issues. I asked counsel for the wife why none of the adult children were called to corroborate aspects of the wife’s evidence or to repudiate that of the husband and was told something to the effect that the wife chose not to involve them in proceedings between the parents. If that is the case on both sides then that is quite a proper position for the parties to take and some credit is due to them for not involving their children in the proceedings. However, that does not resolve the problems caused by the factual disputes in the case.
Submissions
The written submissions made on behalf of the wife are:
ASSETS & LIABILITIES
ASSET HUSBAND’S VALUE WIFE’S VALUE AGREED OR DETERMINED VALUE [C] property $645,000 Block of units at [F], Lebanon $147,000 Husband’s 1992 Ford Fairmont sedan $500.00 $3,000 Wife’s jewellery $1,000.00 Husband’s bank accounts in Lebanon (est) $430,000 $700,000.00 Husband’s Woolworths Ezi Card account $1,260.00 Wife’s Commonwealth Bank accounts $38,178.25 Wife’s superannuation $224,856.56 Household contents $800 $3,000 ADD BACK: [Mr H] fee paid by wife. Husband to reimburse wife $1,500 LIABILITIES Husband’s legal fees $10,000.00 Wife’s legal fees $20,000 Wife’s future medical expenses SUMMARY OF ARGUMENT
Ascertainment of the Net Pool of Assets
The only significant amount in dispute is the amount in the husband’s bank accounts in Lebanon.
Assessment of Contributions
The wife made a direct financial contribution by engaging in full-time employment for most of the marriage.
She was also the primary home maker and parent to the six children of the marriage.
She made a special contribution in relation to caring for the disabled child [J] who was diagnosed with muscular dystrophy at five years of age and died at 16 years of age.
The wife made a special contribution of $64,000.00 by way of an inheritance from her father’s estate, which monies were used to renovate the matrimonial home.
The wife’s close relatives contributed labour goods and labour towards the renovations and improvement of the matrimonial home at cost price.
The wife cared for the husband for 12 months when he was injured.
The wife contributed in mid 2005 the sum of $299,500 by way of compensation payout from serious head and spinal injuries received in a car accident.
The wife contributed directly and indirectly to the monies accumulated by the husband in Lebanon some of which monies were in joint accounts, but which the husband subsequently transferred into his sole name without the wife’s consent.
Having regard to the above contributions and especially the lump sum contributions of the wife to the pool of assets, the wife has made a 20% greater contribution than the husband, so that the contributions should fairly be assessed at 70% by the wife and 30% by the husband.
Post separation: The wife has made virtually the sole contribution as parent and homemaker for the child with virtually no assistance from the husband.
Section 75(2) Factors
(a)[The wife] is not in good health, suffering from dizziness, migraines and chronic lower back and shoulder pain. She also suffers a depressive illness. She has not worked since March 1979 being 29 years.
(b)[The wife] does not have the physical or mental capacity for gainful employment. She has limited income and needs a proportion of her compensation claim to meet her future health needs.
(c)[The wife] has the care and control of the child of the marriage, [O] who is now 12 years of age. The child is not performing at a satisfactory level at school and has not achieved satisfactory outcomes as assessed by the Dept of Education. He is undergoing tutoring at a cost of $40 per week paid for by the wife. The child will be attending a private school next year (Year 8) to Year 12 to cater for his special needs.
(d)[The wife] needs to support herself and the 12-year-old child of the marriage [O] with no financial support and only minimal child support of $5 per week from the husband.
(f)[The wife] eligible for Supporting Parents Benefit and Parents Allowance.
(g)[The wife] requires accommodation to house herself and the 12-year-old child of the marriage.
(k)The marriage was over 30 years’ duration and [the wife] gave birth to six children.
(l)[The wife] wishes to continue in her role as a parent.
(m)[The wife] is not cohabiting with another person apart from children of the marriage.
(na)The husband provides nominal child support of $5 per week and is unlikely to provide any increased support in the future.
(o)The husband has income-producing real estate in Lebanon together with substantial cash funds in Lebanon.
In all the circumstances set out above it is just and equitable that a further 10% adjustment be given in favour of the wife.
Just and Equitable Requirement – Section 79(2)
The husband has made non disclosure, mislead the court, caused excessive costs to the wife to bring the matter to trial. The wife needs to care for herself and the challenged child of the marriage under 18 with minimal support from the husband. She has made a very large contribution of her personal injury claim monies shortly before separation and requires those monies for future needs.
ISSUES FOR DETERMINATION
1.Assessment of the weight to be placed on the wife’s contributions as wage earner, parent, homemaker, inheritance of $64,000.00 and compensation payout of $299,500.00 in mid 2005.
2.Determination of the assets and amount of monies the husband has in accounts in Lebanon.
3.Determination of the contributions by the parties to the real estate property in Lebanon.
4.Capacity of the husband and the wife for future employment.
5.The future needs of the wife to care for herself and the child [O] now aged 12 without any meaningful assistance from the husband.
As the case was finally argued the wife seeks a payment from the husband of $84,000 based on a division of the assets based on contributions (to a pool excluding the wife’s $299,500 compensation payment) in the proportions 52% to the wife and 48% to the husband and no adjustment under section 75(2). In the event that the compensation payment is included in the pool then the result is said to be the same because the husband made no contributions to the compensation payment.
It is submitted for the wife that the bank husband’s Lebanese bank accounts should be put at a notional $610,000 because he has failed to disclose the current balances. The wife relies on the evidence contained in the affidavit of the husband’s former solicitor sworn 21 August 2006 by which the husband concedes[2] the existence of three accounts which as at 2 August 2006 stood at:
[2] Exhibit 6, paragraphs 30, 34 & 36
ACCOUNT BALANCE Banque Libano-Francais
Lebanese pounds 150,251,370$130,921.00 Blom a/c no. […]
Lebanese pounds 210,634,278$184,764.00 Blom a/c no. […]
$A$225,038.97 $540,723.97
To that balance, it is submitted, should be added an amount for the second balance with Banque Libano-Francais referred to in annexure F2 to that affidavit of LBP 23,432,802 which I am asked to include at approximately $A20,000. Next, it is submitted that I should add the balance of the Banque Audi account[3] in the husband’s name, not previously disclosed by the husband, which held $US10,000 as at August or September 2003. I am asked to include that at $A15,000. That is said to bring the total holdings at not later than August 2006 to about $565,000. [In fact those amounts total $575,723.97]. It is then submitted that some allowance should be made for interest. The Banque Libano-Francais accounts recorded interest of 8% and 12%. Putting the interest at 8% learned counsel for the wife argues for a further $40,000, taking the notional balance of the Lebanese accounts to about $610,000.
[3] Exhibit 11 account number […] which shows $US10,000 as at 08/09/2003;
In order to confirm that approach and to counter the submission made on behalf of the husband that the parties could not have accumulated such a fund, the submission on behalf of the wife is to the following effect. 30 years of rent on the Lebanese property at $2,000 per annum is $60,000; $2,500 per annum saved from social security over 30 years is about $75,000; $100 per week earned by the husband from his taxi driving could amount to $150,000 and the total of those sums, with compound interest could be $610,000 in 2007. Further it is submitted that there was no reference to the funds in Lebanon being the exclusive result of the husband’s family’s contributions and the moneys provided by the parties’ children in the husband’s first affidavit. It is submitted that the reason it was omitted is that it is a recent invention.
It is submitted that the wife’s compensation payment of nearly $300,000 should be omitted as a post separation asset and the funds representing that amount (superannuation, bank savings, furniture acquired with those funds, $50,000 advanced to U) should be left out of the pool. By way of an alternate approach it is submitted that if included, the husband made no contribution to those moneys. It is submitted that both parties’ household effects should be omitted from the pool. The husband still owes the wife $1,500 for his share of the moneys paid to the real estate valuer in Lebanon
Thus, on behalf of the wife, the pool is said to be:
ASSET HUSBAND’S VALUE [C property] $645,000 Block of units at [F], Lebanon $147,000.00 Husband’s 1992 Ford Fairmont sedan $500.00 Wife’s jewellery $1,000.00 Husband’s bank accounts in Lebanon (est) $610,000 Husband’s Woolworths Ezi Card account $7,916.00 ADD BACK: [Mr H] fee paid by wife. Husband to reimburse wife $1,500.00
Then it is submitted that the contributions favour the wife in the proportions 52% by her and 48% by the husband. The husband’s initial contribution of the Lebanese property is said to be balance by the wife’s inheritance of $64,000. The wife made the greater overall contribution because of the fact that she was in paid employment for a period and then gave birth to 6 children and was the main care giver and homemaker, with the additional demands of a very ill child.
On that basis, it is submitted that there should be no section 75(2) adjustment. Learned counsel for the wife calculates the outcome of that reasoning to require the husband to pay the wife $84,000, the wife to retain the C home and for the parties to otherwise retain what they have. The injunctions should stay in place until the husband pays the money.
The written submissions made on behalf of the husband were as follows:
Assets
Husband’s Value Wife’s Value[C property] $645,000 $650,000
Property in Lebanon $147,000 $300,000 *
Cash in bank accounts in Lebanon $430,000 $700,000
Cash at hand (husband) $ 1,260 $ 1,260
(wife) $ 1,903 $ 1,903
$299,500 $299,500
Motor Vehicle (husband) $ 500 $ 500
Household contents (husband) $ 800 $ 800
(wife) $ 3,000 $ 3,000
Jewellery (wife) $ 1,000 $ 1,000
___________________________________
$1,529,963 $1,957,990
* the parties have agreed to the value of the Lebanon property being $147,000.00, although the Wife has not filed an updated Financial Statement.
Liabilities
Neither party has any liability other than the husband’s legal fees of $10,000.
Superannuation
Neither party has any superannuation.
Net Pool $1,519,963 (Husband) $1,957,990 (wife)
S79(4) Contributions
Prior to marriage husband owned land in Lebanon with partially completed dwelling consisting of 5 units.
In about 1976 or 1977 Husband receives $8,200 compensation as a result of an injury suffered at work.
In 1994, the husband’s family gave to the husband $17,000.00.
In about 2004 Wife received compensation of $440,000 exclusive of costs as a result of a motor vehicle accident.
Husband’s family contributed to bank accounts in Lebanon.
Husband worked full time as a factory worker until about 1988. From 1986 he also worked as a casual taxi driver, usually on a Sunday night. From 1988 husband worked casually as a taxi driver.
Wife worked as a process worker until the birth of the first child. A period of about 18 months.
Wife’s primary role of homemaker and parent.
Husband assisted with care of children, particularly [J] after 1988 until his death in 2003.
Husband undertakes renovations to matrimonial home at [C]. Maintains property including gardens and lawns.
It is asserted that on a contribution based entitlement the husband would receive in the vicinity of 60% and the wife 40%.
S75(2) Factors
Husband is 60 years of age.
Wife is 52 years of age.
Neither party in full-time employment. Both parties receive Centrelink benefits. Husband receives a disability allowance and works from time to time as a taxi driver.
Parties’ sixth child, turning 13 in August 2007, lives with the wife.
Both parties suffer medical conditions.
Husband suffers from ischaemic heart disease, rheumatoid arthritis, hypertension, hyperlipidenia and anxiety disorder. Husband is admitted to hospital every two months to receive intravenous treatment for rheumatoid arthritis.
Husband pays child support for youngest child. (minimum rate of child support per the administrative assessment given his pension income)
It is asserted that any adjustment under section 75(2) in favour of the wife would be a maximum of 5%.
Therefore in a division of the property of the parties the husband would receive 55% and the wife 45%
Effect of orders Sought
Husband’s Value Wife’s Value
Husband’s OrdersProperty in Lebanon $147,000 $ 300,000
Cash in bank accounts in Lebanon $430,000 $ 700,000
Payment from Wife $260,000 $ 260,000
Cash at hand (husband) $ 1,260 $ 1,260
Motor Vehicle (husband) $ 500 $ 500
Household contents (husband) $ 800 $ 800
___________________________________
$839,560 $1,262,560
Net % Husband 55% 65%
Wife 45% 35%
Wife’s Orders
[C property] $645,000 $650,000
Property in Lebanon } $432,750 $750,000
Cash in bank accounts in Lebanon }
Cash (wife and husband) $ 2,372 $ 2,372
$224,625 $224,625
Household contents/car $ 3,225 $ 3,225
Jewellery (wife) $ 750 $ 750
___________________________________
$1,308,722 $1,630,972
Net % Wife 85% 83%
15% 17%
Just and Equitable
It is asserted that after a long marriage (either 26 or 28 years), and taking into account:
· the husband’s greater financial contributions, both direct and indirect by way of his family; and
· the husband’s non-financial contributions, in terms of the renovations carried out on the matrimonial home;
· the husband’s role as the carer of the child [J]; and
· the husband’s ill health and his age;
that a division of the property of the parties whereby the wife would retain the former matrimonial home unencumbered (which on her evidence would produce an income of in excess of $200 per week and which is valued at about $645,000), and where she would retain a cash sum of at least $30,000, is just and equitable in the circumstances of these parties. The husband is 60 years of age, is largely unable to work, and has no superannuation entitlements for his retirement, and requires sufficient funds to house himself adequately and to support himself and his increasing health costs for the remainder of his life.
In final submissions on behalf of the husband. The pool of assets was said to be as follows:
Assets Value [C property] $645,000.00 Block of units at [F], Lebanon $147,000.00 Husband’s bank accounts in Lebanon $430,000.00 Husband’s Woolworths Ezi Card account $7,916.00 Husband’s 1992 Ford Fairmont sedan $500.00 Husband’s household contents $800.00 Wife’s jewellery $1,000.00 Wife’s Commonwealth Bank accounts $37,694.00 Wife’s superannuation $224,756.55 Wife’s household contents $3,000 Moneys paid by wife to [U] $50,000.00 Total $1,547,666.55
It is submitted on behalf of the husband that the apparent confusion over disclosure and the inadequacies of evidence should be put down to the difficulties faced by the parties in giving evidence in another language and their lack of sophistication. It is submitted that this was a long marriage and they both worked hard.
It is conceded on behalf of the husband that there is no debt to the children or to members of the husband’s family in relation to the funds held in Lebanon. Contributions however, should be assessed at 60% by the husband because the contribution of the Lebanese property came through him. In addition, the funds that completed the building on that property and that built up the balance of the Lebanese accounts were sourced in his extended family and the children. It is submitted that the parties simply did not have sufficient funds to send money to Lebanon.
Then it is submitted that the wife should receive an adjustment of 5% under section 75(2) because the husband has some paid employment. It is submitted that the wife has an earning capacity in the form of potential rental income from the flats. That means an adjustment of 55% to the husband. That should be achieved by a payment of about $260,000 by the wife to the husband. In default of that payment he should receive that sum from the proceeds of sale of the C property.
The approach in proceedings under section 79
The case law reveals that there is a permissible approach to the determination of an application brought pursuant to the provisions of s 79. That approach involves four inter-related steps. First, I am to make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing. Second, I should identify and assess the contributions of the parties within the meaning of s 79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Third, I should identify and assess the relevant matters referred to in s 79(4)(d), (e), (f) and (g), (the other factors) including, because of s 79(4)(e), the matters referred to in s 75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two. Fourth, I should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case. [4]
A separate pool for superannuation
[4] This summary of the effect of the authorities is paraphrased from the comments of the Full Court in In the Marriage of Hickey (2003) 30 Fam LR 355 at 370
In the Marriage of Coghlan (2004) 33 Fam LR 414 the majority of the Full Court said that the preferred approach is to have a separate pool for superannuation assets but allowed that superannuation may be included in the list of property drawn up as “the first step” in the determination of proceedings under s 79, whether or not a splitting order is sought in those proceedings. The Full Court suggests that that:
“… approach could be adopted where the parties agree that it should be adopted, or where the court is satisfied that the superannuation interest is indeed property within the meaning of the definition of property contained in s 4(1), or if the interest is not within that definition, but is of relatively small value in the context of the value of the other assets in the case, or there are features about the interest which leads the court to conclude that this would be an appropriate approach.”
Here the parties do not agree that there should be a global approach to the assessment of contributions. The submission made on behalf of the wife is that the compensation payment should be left out altogether or, if included in the pool, that the contributions be assessed separately (and at 100% by the wife to the compensation payment). The fact is that the wife converted $200,000 of her compensation moneys into superannuation only relatively recently (27 October 2006) and for much of the life of the litigation, this issue did not arise. The superannuation is of significant value, the wife is only 51 years of age and there is no other evidence to suggest that her superannuation interest is property. On the basis of the preferred approach I will deal with the contributions to the superannuation fund separately.
The property of the parties at the date of the hearing
The Court is required to make a finding as to the property of the parties at the date of the hearing.
The husband’s financial disclosure is not satisfactory. But for questions asked in cross-examination, the husband’s evidence was that his Commonwealth Bank account holds $1,260 and not $7,916 which his bank statements reveal. The husband has not provided evidence of the current balance of his accounts with the Blom Bank and Banque Libano-Francais.
There are circumstances which the Court has found in other cases, to have justified the inclusion of property that no longer exists, in the pool of property for settlement. Similarly the Court has sometimes found that debts that do exist should not be included in the list that goes to make up the net pool of assets. In In the Marriage of Omacini (2005) 33 Fam LR 134 the Full Court noted:
[30] To date, three clear categories of cases have emerged where the court has determined that it is appropriate to notionally add back to the pool of assets, that is, assets that no longer exist. They are:
(a) Where the parties have expended money on legal fees. In In the Marriage of DJM and JLM (1998) 23 Fam LR 396; (1998) FLC 92-816; [1998] FamCA 97 the Full Court said at [11.6]:
[11.6] For reasons set out in Farnell, s 117 provides that each party to proceedings under the Family Law Act shall bear their own costs unless the Court otherwise orders. Failing to add back monies expended by parties on costs frequently has the effect of defeating the policy of s 117 by permitting the pool of available assets for distribution between the parties to be diminished by any monies that either of the parties have managed to spend on their costs up to the date of trial. We are of the view that the normal approach ought be to add costs already paid back into the pool. Whilst there may be cases where that approach is inappropriate, the reasons why it is not taken ought normally be spelt out.
(b) Where there has been a premature distribution of matrimonial assets. In In the Marriage of Townsend (1994) 18 Fam LR 505; (1995) FLC 92-569 Nicholson CJ as he then was with whom Fogarty and Jordan JJ agreed, said at Fam LR 509; FLC 81,654:
In my view, what occurred in this case, as I said during the course of argument was, in fact, a premature distribution of a proportion of the matrimonial assets. What the husband did was to distribute to himself an asset in which the wife had a legitimate interest. In such circumstances I consider that it would be unjust in the extreme to simply treat such conduct by the husband as a matter to which regard should be had under section 75(2). It seems to me that the husband has had the benefit of that money. Had he retained, for example, the taxi licence instead of selling it, that would have been brought into account as an item of property which would have been dealt with in the same way as the remaining items of property in this case. Accordingly, I am of the view that the correct way in which to deal with the husband’s receipt of those moneys is to bring them into the pool of assets on a notional basis and make a distribution accordingly.
(c) In the circumstances outlined by Baker J in In the Marriage of Kowaliw (1981) 7 Fam LN N13; (1981) FLC 91-092 at FLC 76,644:
As a statement of general principle, I am firmly of the view that financial losses incurred by parties or either of them in the course of a marriage whether such losses result from a joint or several liability, should be shared by them (although not necessarily equally) except in the following circumstances:
(a) where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets, or
(b) where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value.
Conduct of the kind referred to in para (a) and (b) above having economic consequences is clearly in my view relevant under s 75(2)(o) to applications for settlement of property instituted under the provisions of s 79.
Dealing with disputed claims that notional assets be included in the list of assets for division:
The balance of the Husband’s bank accounts in Lebanon
The husband contends that there is approximately $430,000 in accounts in his name in Lebanon. The wife contends that there is about $610,000 in those accounts. It is not credible that the husband is unable to provide evidence of the current balance of his accounts with the Blom Bank and Banque Libano-Francais. He was ordered to provide that evidence earlier in the proceedings and did not. The bank statements are dated and ambiguous. It is possible that the second balance in the nature of a term deposit with Banque Libano-Francais referred to in annexure F2 to the affidavit of the husband’s first solicitor of LBP 23,432,802 was part of and not in addition to the balance of LBP 150,251,370 held with that bank. In an affidavit of August 2006 his then solicitor annexed copies of statements of the accounts as at 2 August 2006. Why were those balances not updated for the hearing? In the husband’s own affidavit sworn in April 2007 he annexes some of the same bank statements that were annexed to his solicitor’s affidavit of August 2006 but, without explanation includes reference to his balance in the Banque Libano-Francais as the LBP 23,432,802 that was not mentioned in the text of the August affidavit and omits any mention of the balance of LBP 150,251,370 which was disclosed in the earlier affidavit. He does not explain how he dealt with the latter sum since August 2006. In relation to an account held with Banque Audi in R in 2003 in his name, the husband rejected that fact in cross-examination and said that his wife used to have such an account and that she deposited $10,000 in her own name as her secret money. The copy of the statement put into evidence shows the account to be in the husband’s name, not that of the wife.
The husband has failed to properly disclose the current value of his interests in bank accounts in Lebanon. On the basis of the concession made through his solicitor in August 2006 the husband had the following assets:
ACCOUNT BALANCE Banque Libano-Francais
Lebanese pounds 150,251,370$130,921.00 BLOM a/c no. […]
Lebanese pounds 210,634,278$184,764.00 BLOM a/c no. […]
$A225,038.97$225,038.97 $540,723.97
In 2003 the husband had $US10,000 in Banque Audi in R. Using the exchange rate as at 6 July 2007 [$A1.164 = $US1.00] that has a value of $A11,640. In the absence of any proper explanation I find that he continues to hold those funds. That means that as at August 2006 and 2003 respectively, the husband had $552,363.97 in Lebanese banks. As the balances are not current those findings are artificial but permissible in the circumstances.
Beyond those amounts I am confident that the husband has other moneys in Lebanon but cannot put a figure on them. For example he received or could have received interest on those balances of about $44,000 if invested at 8%. The evidence about interest is confusing. The evidence suggests that the funds held with Banque Libano-Francais were in interest-bearing term deposits. It is not clear that interest was earned on the accounts held in the Blom bank and if not, why not. The husband is a devout Muslim and as I understand it, the paying or receiving of interest is against the tenets of that religion. However, the parties presumably paid interest on the mortgage on the C home and the husband received interest on funds held with the Banque Libano-Francais. Lest it be suggested to the contrary there is no reason given why all of the funds in banks in Lebanon could not have been earning interest.
Finally, given that he has separately conceded both LBP 23,432,802 and LBP 150,251,370 were sums invested with Banque Libano-Francais, it is possible, as is submitted for the wife, that both concessions were correct and that in addition to the latter sum which is contained in the table that follows paragraph 67 above, he had an additional LBP 23,432,802 with that bank.
The fee paid by the wife to FH on behalf of the husband
The wife seeks that there be added to the pool a sum of $1,500 being the contribution of the husband to the fees of the lawyer and valuer who valued the property in Lebanon. There seems to be no dispute that the husband owes this amount to the wife. Rather than including the figure in the pool of assets I will simply make an allowance in the final adjustment between the parties.
The household contents of the parties
The contents themselves will be left with the party who currently has possession of them. For the purposes of the settlement of property the husband seeks that the agreed figures for the respective household contents be included in the pool and the wife opposes that course. I will exclude the household contents. After separation the wife spent $7,000 on a bedroom suite and $700 on a chair. Furniture generally depreciates but those amounts more than make up for the imbalance of value of the household contents of the parties.
The $50,000 advanced by the wife to U
The wife advanced $50,000 from her compensation moneys to the parties’ son, U on 25 September 2006. The advance was for the purposes of a car sale business he wanted to open. In cross-examination the wife was asked if she had loaned $50,000 to U and she agreed. There is no written agreement. When asked if she expects repayment she said words to the effect that “God would know, I do not”. She was later asked if she had asked for repayment and responded with words to the effect “He said he will when the business is more steady.” The wife was asked about charging interest and responded with words to the effect that “we don’t believe in interest”. It is clear then that there has been communication between the wife and U consistent with there being an expectation of repayment. Therefore the character of the advance was of a loan. I will include the $50,000 as an asset of the wife.
I find that the assets of the parties are:
Non Superannuation Assets Value [C property] $645,000.00 Wife’s Commonwealth Bank accounts $37,694.27 Wife’s jewellery $1,000.00 Moneys loaned to [U] for car sales business $50,000.00 Block of units at [F], Lebanon $147,000.00 Husband’s Woolworths Ezi Card account $7,916.00 Husband’s bank accounts in Lebanon (at least) $552,363.97 Husband’s 1992 Ford Fairmont sedan $500.00 Total $1,441,474.24
Superannuation Assets Value Wife’s T superannuation $224,756.55 Total $224,756.55
Liabilities:
The parties disclose no relevant liabilities for the purposes of ascertaining the net pool of assets.
Legal fees
The wife has incurred fees of about $20,000 up to the date of the hearing and will owe a further $8,222 for the two day hearing, making a total of $28,222.
The husband had incurred $8,782.95 to the date of the hearing and his lawyers estimated that the additional costs to the conclusion of the hearing would be $11,450, making a total of $20,232.95. He previously instructed another attorney, Mr A and as at August 2006 owed him $10,000.
I find that the liabilities of the parties as at the date of the hearing are as follows:
Liabilities Amount Wife’s legal fees $28,222.00 Husband’s legal fees $30,232.95 $58,454.95
Net assets
The legal fees are not relevant for the purposes of identifying the net pool of assets. The non-superannuation assets have a value of $1,441,474.24. The superannuation assets have a value of $224,756.55.
Financial Resources
Other than undisclosed funds in the hands of the husband there is no evidence that either of the parties has any other financial resources.
Contributions
The obligations placed on the Court by s 79 call for an assessment of the respective contributions of the parties. The manner of assessing contributions has been the subject of previous decisions. The contributions of a parent and homemaker are to be assessed, not in any merely token way, but in terms of their true worth to the building up of the assets[5]. There are said to be risks in taking an overly technical approach to the assessment of the respective contributions of the parties in that the Court can become involved in questions of the quality of contributions which go far beyond the real world expectations of parties[6].
[5] Mallett v Mallett (1984) 9 Fam LR 449; In the Marriage of Ferraro (1992) 16 Fam LR 1
[6] In the Marriage of Shewring (1987) l2 Fam LR 139
As to whether the Court should assess contributions asset by asset or globally the authorities have it the latter approach is preferred, in appropriate circumstances either approach is permissible and sometimes the asset by asset approach is best. See In the Marriage of Lenehan (1987) 11 Fam LR 615; In the Marriage of Norbis (1986) 10 Fam LR 819; FLC 91-712; In the Marriage of Zyk (1995) 19 Fam LR 797.
Here the wife argued the case by seeking to exclude her compensation payment. Given that the compensation moneys were received well after separation there is force in that submission. In my view the weight of the argument can be accommodated by dealing with contributions to the non-superannuation assets together. As foreshadowed above, I will adopt the preferred approach and address contributions to superannuation separately from those to the non-superannuation assets.
Contributions to non-superannuation assets
Section 79(4)(a) Contributions
The husband brought into the marriage some land in Lebanon. There is no evidence of its value in 1974 but we know that it was either vacant land or land with a partial construction on it. We know that the land today, more than 33 years later and improved by the construction of a block of 5 units, has a value of $147,000.
There is no evidence of any other initial contributions.
The husband received a compensation payout of the order of $8,000 to $10,000 in about 1975 or a few years later. That would normally be seen as an incident of his employment, akin to wages and will have little weight.
Apart from a period of about 12 months early in the marriage and for the duration of some overseas trips, the husband has been in paid employment throughout the marriage and to the date of the hearing. To 1988 he was in full-time employment and since then has worked as a taxi driver 1 or 2 days a week.
The wife had paid employment for somewhere between 18 months and 4 years at the commencement of the marriage. Since then she has been out of the paid workforce.
The wife says that in 1991 she received an inheritance from her father’s estate of $64,000.00, which was used for renovations to the C property. I accept the wife on this issue. By 1991 the husband was only working 1 or 2 days a week and the wife was not in paid employment. The renovations were undertaken and were extensive. I accept that the inheritance was received.
The husband says that $17,000 was sent to him by members of his family in about 1994 to help with J’s expenses.
As to the bank accounts in Lebanon - the husband contends that as to about $A100,000 the moneys held in his name in Lebanon represent moneys paid to him by his children. He mentioned four children during cross-examination as the source of the funds but named only M, H and U in his affidavit. He says that between 2000 and the present day, they gave him money. At the end of the day I was left to speculate about the circumstances in which, according to the husband, the money was given to him – whether it was money paid for board that the husband chose to invest and wants to return to them or money given to him for the purpose of being invested for the children. He recalls that M paid him about $45,000 for this purpose in about 2003. The wife challenges this evidence. There is no evidence from M, H or U on this issue. It is the husband’s evidence in cross-examination that M paid him by weekly amounts of $100. He cannot reasonably assert that moneys paid at that rate during 2003 accounted for $45,000. It is odd that U called on his mother for $50,000 to start his car sales business instead (on the husband’s case) of calling on his own funds held by his father in Lebanon. Otherwise, the husband contends that the moneys in Lebanon were paid into the account/s by members of his family as part of distributions of income from the family orchard and from the time of J’s diagnosis, for J’s long term support. The husband said that he intends the divide the bulk of the moneys among his surviving siblings and to return his children’s money to them or at their direction.
As the husband’s case was finally argued, he does not contend that any of the funds held in the Lebanese accounts are owed to his children or to members of his extended family.
Neither of the parties contends that any moneys paid by the children were paid solely to benefit only one of the parties. Therefore even if some of the moneys now in the accounts in Lebanon came from the children, that does not affect the balance of contributions.
As to the rest of the moneys there are two very different arguments. The husband says that the moneys were all or largely sourced from members of his extended family in Lebanon. It is the wife’s case that the moneys were largely sourced in matrimonial funds repatriated by the husband to Lebanon. She concedes that some of the moneys came from rental income on the Lebanese property.
It is the husband’s case that over the years the rental income from the units in Lebanon was barely enough to cover their costs – maintenance and the wages of the managing agent. Thus he says that, at least in the later years, there was no contribution to the accounts from him from that source.
There is no evidence to support the case of either party on this issue. For example, there is no evidence from members of the husband’s extended family as to the gifts they made. It would be a relatively simple task for the husband to account for the regular deposits made into the Lebanese accounts – for example the payments made into the Blom account with the prefix … and those into the Banque Libano-Francais showing a ‘final’ balance of 23 million Lebanese Pounds[7]. On the other hand the wife gives no evidence to support her contention of the regular transmission of funds by the husband to Lebanon over the last 33 years. In the circumstances it is not impossible for the parties to have built up such a fund over more than 30 years through their income, including interest on invested moneys and the income on the units in Lebanon. For example it transpires that the husband is on a very modest income but he was able to build his saving account from $1,260 in August 2006 to $7,916 in June 2007 solely from his income from the pension. In addition, it is his sworn evidence, he did so notwithstanding a significant gambling habit. His income from driving a taxi cab is not paid into the account and is used for his expenses and for gambling.
[7] Annexure B to the Husband’s affidavit sworn 20 April 2007
In conclusion, the Lebanese funds are in the husband’s name. The most likely reason for that is that they are his funds. The husband asserts that the funds came from elsewhere, he is challenged on that assertion and cannot corroborate his evidence. I find that the contributions to the Lebanese accounts were joint contributions.
After separation the wife received a compensation payout. Most of the funds are represented in superannuation which is dealt with below. However, the wife’s savings and the payment of $50,000 to U were sourced in that payout. These were contributions made by the wife alone.
Section 79(4)(b) contributions
The husband deposes to the following contributions:
Installing carpets;
Installing doors;
Painting the house every 4 or 5 years;
Assisting tradesmen;
Building two granny flats;
Undertaking landscaping, erection of fences and necessary retaining work.
The wife’s cousins, brother, uncle and nephew assisted with the renovations but received some payment. The wife asserts that they worked at reduced rates. There is no evidence to support this contention.
It is likely that the husband made the greater non-financial contribution.
Section 79(4)(c) contributions
In cross-examination the husband agreed that the wife was the primary carer of the children. The only dispute relates to the extent of the husband’s contributions as parent and homemaker.
The wife was the primary care giver until the husband retired from labouring work in 1988. Thereafter there is a dispute as to the extent to which the husband contributed. It is the husband’s case that from 1988 he assisted the wife in relation to the care of the children and the home. That assistance included taking the children to doctors and hospitals when they were sick, taking them to parks and beaches and weekend and holiday outings, assisting with washing clothing, washing dishes and cleaning the house. The wife concedes that the husband undertook some of the homemaker role prior to her retirement from the paid workforce. She also concedes that she and the husband performed the grocery shopping together as she did not drive. In cross-examination she conceded that even after that time the husband helped in homemaker and parenting tasks, albeit not to the extent of her involvement in those tasks.
In relation to assistance given to J, the parties’ evidence is diametrically opposed. The husband asserts that he assisted with all aspects of J’s care and the wife disputes that. I accept that the husband played a valuable role. He gave unchallenged evidence that he took J with him to Lebanon at one point. For that period the only contributions to J must have come from the husband or his family. Nevertheless I also accept that the wife, with the assistance of the older children, performed more of this work. J was very ill and needed significant assistance with his daily care. The husband was engaged in paid employment for part of each week. For those periods he could not have assisted J. The overall weight of evidence, indeed the concessions made, has the wife undertaking the greater parenting and homemaker role.
The only recent evidence about parenting necessarily relates to O. The wife was challenged in cross-examination in relation to her express intention to change O’s school back to A private school where he attended to Year 2. She was asked to confirm that intention and her dissatisfaction with his progress at B High School. She did that. She was asked if she had any school reports to support her contention that O was not doing well at school and produced a copy of the Basic Skills report from 2005 which shows O in Band 3 out of 6 in relation to both literacy and numeracy. She gave evidence about paying for weekly tutoring for the boy for about the last 5 months so his school work could improve and she could move him to a private school. There is no background evidence about O’s learning capacity but on the face of the report, there has been some work to do. O was below the National Benchmark for reading and well below his school’s average mark for overall literacy. He did better in writing and numeracy where he scored over the National Benchmark and was closer to the average for his school. That this line of cross-examination was pursued suggests that the husband is not as involved as the wife in relation to O’s education. It is the wife who arranges the tutoring. She has not discussed a change of school for O with the husband as the husband does not talk to her or the boy. She had planned to return O to A school for the start of Year 7, this year and it is not clear why she did not do that. She has been advised that he has been accepted into Year 8 at that school in 2008.
From either 1976 or 1978 until the husband left the full-time workforce in 1988, the wife was not in the paid workforce and she undertook the main parenting and homemaker role. There is a dispute between the parties in relation to the division of the homemaker duties after 1988 but it is conceded that the wife made the greater contribution. Given the evidence of arrangements since separation, it is likely that overall the wife undertook the lion’s share of these roles.
Conclusion on Contribution
The argument on behalf of the wife is that her contributions exceeded those of the husband in the proportions 70% by her and on her behalf and 30% by and on behalf of the husband. The husband argues that his contributions exceeded those of the wife in the proportions 60% by him and 40% by and on behalf of the wife. This was a long marriage and care is needed in making an adjustment for a particular contribution or type of contribution lest the significance of the efforts of more than 3 decades be lost.
There is a relevant discussion about the approach taken to this sort of weighing exercise in In the Marriage of Pierce (1998) 24 Fam LR 377. My task is not a mathematical exercise and there is no concept of erosion of contributions made earlier in the marriage. I am to assess the respective contributions and to give them appropriate weight.
On the basis of the findings I have made, the wife’s inheritance is likely to balance the husband’s injection of the Lebanese property. $17,000 was contributed to J’s care by members of the husband’s family some years ago. I have found that the balance in the Lebanese accounts represents a joint contribution. Otherwise the parties undertook traditional roles and worked very hard for many years. The wife made additional financial contributions after separation. They are represented in the pool of non-superannuation assets by the savings of over $37,000 and the $50,000 advanced to U. A case can be made in those circumstances for the 2% allowance sought on behalf of the wife but in the context of this case and with all of the uncertainties about the evidence, in my view the proper finding is one of equality of contributions to this pool.
Contributions to superannuation
Section 79(4)(a) Contributions
The wife’s superannuation resulted solely from her compensation payment. There is no evidence to suggest that the husband made any significant contribution to that payment. Indeed on either case the accident occurred at or after separation.
Section 79(4)(b) contributions
There is no evidence of any non-financial contributions to the superannuation interest.
Section 79(4)(c) contributions
The contributions under this head are not made to an asset. In any event the main contribution was made by the wife.
Conclusion on Contribution to Superannuation
The wife made the only contributions to the payout. Unlike a windfall, the payment resulted from an accident and the wife suffered significant injuries. She underwent surgery on at least two occasions and continues to suffer from the effects of the accident.
The other matters in Section 79
Dealing with the matters identified in the legislation:
Section 79(4) (d)
Pursuant to s 79(4)(d) I am required to take into account the effect of any proposed orders on the earning capacities of the parties. There is a potential for such an effect.
Firstly, the C property is capable of producing income from rent. The wife’s evidence is that she caused the termination of the last paying tenant and cannot contemplate renting out either flat. Nevertheless the potential is there and would be lost if the property was sold.
The husband says that he earned income on at least one of the Lebanese accounts. If he needs to draw on the funds in Lebanon to pay the wife or for his own housing then those funds would not be available to produce income.
Section 79(4)(e) - Section 75(2) Factors
The relevant matters in Section 75(2) would seem to be paragraphs (a), (b), (c), (d), (m) and (o).
(a) the age and state of health of each of the parties;
First, as to the age and state of health of each of the parties.
The wife is 51 and the husband is approaching 60 years of age.
The wife suffered a car accident in 1999 or around that time. She cut her nose and chin and damaged her back. She suffers from severe headaches and migraines on almost a daily basis. She suffers extreme lower back pain and cannot sit for long periods. She suffers back and shoulder pain on a daily basis. She is depressed and has consulted a psychologist, Dr J. She has been prescribed the antidepressant Endeep and takes it daily. She takes Trammal for back pain and Panamax every 4 to 5 hours. The wife has physiotherapy once or twice a week and hydrotherapy at the same frequency. In 2002 the wife underwent an operation on her skull to address a build up of fluid. In 2000 or 2001 she underwent three operations on her nose by a cosmetic surgeon. In 2005 the wife spent $700 on an operation to one eye to deal with a build up of fluid. She sees her specialist Orthopaedic Surgeon every 6 weeks and regularly visits the family doctor.
It is an agreed fact that the wife has no capacity for paid employment. She suffers the results of the car accident in terms of constant pain, physical restrictions and the economic consequences of those restrictions (the need to be driven to appointments, the cost of personal grooming) and of the conditions she suffers (medical and pharmaceutical bills).
The husband takes Avapro, which he understands is for hypertension, Methotrexate and Prednisone, which he understands are for rheumatoid arthritis, Asprin and Lipiton (it may be that the husband means Lipitor). In September 2005 he underwent a triple coronary bypass operation. In May 2006 he was admitted to E Hospital to have medication for rheumatoid arthritis administered intravenously. He has been told that he will need that treatment every two months. There is no evidence of any financial impact of the husband’s health apart from limits on his capacity for paid employment. It is an agreed fact that the husband has a limited earning capacity. I note however that that agreement was made prior to the husband giving evidence of a very significant gambling habit and of having saved at the rate of $130 per week for the past year or so. It follows that his income and therefore his earning capacity must be greater than he says.
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;
The wife’s income is $391.87 per week made up of the Supporting Parents Benefit of $265.45, Parents’ Allowance of $70.42, child support of $6.00 and $50.00 per week from U. The wife lives with her sons U and O. She does not know how much U earns. There is no evidence of O having any income.
The wife’s expenses are as follows:
Expense Amount Rates $29.76 Medicine $15.00 Telephone $10.00 Food and groceries $200.00 Clothes and shoes for Wife $40.00 Mobile telephone $7.00 Electricity $9.00 Gas $11.00 Physiotherapy $52.00 Beauty treatment $8.00 Hydrotherapy $10.00 Dentist $10.00 Clothes for O $40.00 Pocket money for O $30.00 School fees for O $3.50 Tutoring for O $40.00 Toys games & books for O $10.00 Entertainment $25.00 Lawn mowing $4.65 Repairs to appliances $4.00 My Sat $9.30 Total $568.21
There was some discussion between counsel during the hearing and I was told that some items shown in the wife’s Financial Statement such as a claim for household replacements of $157 per week, were agreed to be excluded. I was told by learned counsel for the husband, without demur from counsel for the wife, that the wife’s weekly shortfall amounted about $129 being an income of $379 and outgoings of $508. I have found the wife’s income to be $391 and not $371. The best I can do is to find that it is agreed that there is a shortfall in the wife’s weekly budget of about $129.
It is not argued that the wife has any unexercised earning capacity.
The husband deposes to an income of $350.00 per week made up of $230 per week from Centrelink and $120 per week from his work as a taxi cab driver. He lives in a flat at the former matrimonial home but alone. The husband’s expenditure is said to be as follows:
Expense Amount Green slip insurance AAMI $7.00 Child support for O $5.00 Living expenses $300.00 Total $312.00
There is something wrong with the husband’s evidence about his income and outgoings. The husband was able to build his saving account from $1,260 in August 2006 to $7,916 in June 2007, solely from his income from the pension. He therefore his savings grew at the rate of about $130 per week over that period. He says that his income from driving a taxi cab is not paid into the account and is used for his expenses and for gambling.
Evidence about his assets, liabilities and resources is set out earlier in these reasons. It is an agreed fact that the husband has a limited earning capacity.
(c) whether either party has the care or control of a child of the marriage who has not attained the age of 18 years;
The wife has the exclusive day to day responsibility for O. The husband and O do not even talk to each other.
(d) commitments of each of the parties that are necessary to enable the party to support:
himself or herself; and
a child or another person that the party has a duty to maintain;
(e) the responsibilities of either party to support any other person;
Findings about those commitments are made above. In relation to O, the wife intends that he be re-enrolled at A private school at L in 2008. He attended that school to Year 2 moving to the State school system. She has been told that the tuition fees are $1,600 per annum, book hire is $70 per annum, uniforms are about $400 per annum, excursion fees are $100 and there is an enrolment fee of $120.
(f) subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
any law of the Commonwealth, of a State or Territory or of another country; or
any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia,
and the rate of any such pension, allowance or benefit being paid to either party;
Each of the parties receives Centrelink payments as referred to above.
The wife has superannuation in the form of an accumulation interest in the growth phase. There is no evidence about the circumstances in which the wife could access these funds. She has permanently left the paid workforce but there is no evidence about the age at which or the conditions under which she can claim the funds.
(g) where the parties have separated or the marriage has been dissolved, a standard of living that in all the circumstances is reasonable;
There is little evidence in relation to the standard of living of the parties during the marriage. They each had trips overseas, mainly to Lebanon. There is no evidence about the duration of all of the trips or the circumstances surrounding them. The wife had three such trips and the husband had at least two. There is disputed evidence about occasional family outings but they were not lavish or expensive affairs. Otherwise the parties apparently had modest incomes and they had six children to support. I am satisfied that the parties lived a frugal existence. Apart from the overseas trips, there is no other evidence of significant discretionary expenditure.
(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income;
Neither of the parties gained additional qualifications during the marriage.
(ha) the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant;
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party;
These matters are not relevant. It was the wife who gave up paid employment to care for the children but her health is such that she has no real earning capacity in any event.
(k) the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
The duration of the marriage and the fact of migration to Australia is likely to have affected the parties’ earning capacities but there is insufficient evidence to make a relevant finding. In any event the parties’ health has determined the issue of their earning capacities.
(l) the need to protect a party who wishes to continue that party's role as a parent;
The wife does wish to continue her role as a parent to O and that is critical at the current time because, sadly, O does not have a good relationship with his father.
(m) if either party is cohabiting with another person — the financial circumstances relating to the cohabitation;
The wife lives with U and O. U pays some board and the wife supports O with a modest contribution from the husband. The husband pays $5 per week in child support and also makes a contributions in the fact that the wife and boys probably live in a greater part of the property.
(n) the terms of any order made or proposed to be made under section 79 in relation to the property of the parties;
(na) 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; and
The husband pays and the wife receives child support at the minimum rate.
(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account;
Waste
The husband says that he gambles. It is his evidence that $10,300 withdrawn by him on 21 June 2002 was used for gambling. When asked about $4,000 withdrawn on 16 May 2005 the husband responded with words to the effect “the only problem I have is gambling”. In relation to a withdrawal of $9,500 on 22 December 2005 the husband initially said he used it to gamble and later said he used it to repay his son. He later said that of about $20,000 withdrawn by him over the 22 & 23 December 2005 some was used to pay his son, some to survive and some for gambling. In relation to withdrawing $2,000 on 7 August 2006 the husband referred to expenses related to a car and gambling. The husband was asked about specific withdrawals and not about gambling in general. It may be that the husband used the proceeds of other withdrawals to gamble.
In relation to the income from driving a cab the husband says that he does not pay it into his bank account but that he needs it for his expenses and “I gamble”.
In the course of his cross-examination learned counsel for the wife tested the husband in relation to this issue. I take it from the line of questions that the wife does not accept that the husband gambles at all or to any significant extent. The husband agreed that he is a devout Muslim and that gambling is against the tenets of his religion but said words to the effect “but I cannot stop it.”.
The rather unusual situation therefore is that the husband asserts that he has applied family funds to gambling and the wife does not accept his evidence. This issue has consequences for the rest of the case. If the husband is accepted, as is noted above it tends to suggest that the husband has understated his income. If he has understated his income, that means that he cannot rely on a submission that there was always insufficient income for him to have repatriated family funds to the Lebanese accounts. If the husband did not gamble then he has failed to account for the significant withdrawals of funds from his account that he was asked about in cross-examination and has given false evidence about the application of those funds.
Given that it creates adverse inferences against him I accept the husband’s admissions against interest that he gambles and has applied specific and significant sums to gambling. I do not know when the gambling commenced or the total amount lost.
(p) the terms of any financial agreement that is binding on the parties.
There was no binding agreement made between the parties.
Section 79(4)(f)
There are no relevant orders.
Section 79(4)(g)
This provision is not relevant.
Conclusion
I apprehend that the submissions made by the parties on this matter depend on the findings about the pool and about contributions. For example the wife argues for no adjustment provided that the Court makes findings on the pool and contributions as argued in her case.
The relevant matters arising from the remaining elements of s 79, which include the s 75(2) factors referred to above are:
Ø The husband is older than the wife but is still capable of some paid employment and she is not;
Ø The wife continues to suffer from the affects of a serious motor vehicle accident that gave rise to her compensation paid in 2005 or 2006;
Ø The husband has undisclosed assets;
Ø The husband probably understates his income;
Ø Subject to the extent of his non-disclosure, the wife may be entitled to more assets than the husband based only on the contributions of the parties;
Ø The wife has more of her assets tied up in superannuation interests and is likely to need to wait to access those funds;
Ø Apart from a nominal child support contribution, the wife has and it is likely that she will continue have, exclusive responsibility for O who is yet to turn 13 years of age.
Arguing for an adjustment to the wife are the facts of O’s care and support falling largely on her and the fact that she has no income earning capacity. Arguing against such an adjustment is the fact that the wife will have $224,000 in superannuation, over and above 50% of the identified assets. In my view there should be no adjustment by virtue of the other matters in section 79(4).
Just and Equitable
Based on their contributions and the other matters in s 79 the appropriate division of non-superannuation property is a division that is about equal. Finally, I must consider whether it would be just and equitable within the context of s 79 if the net assets of the parties were divided in those proportions.
The non-superannuation assets have a value of $1,441,474.24.
The outcome of that division would be that each of the parties receives $720,737.12.
The wife has or has had the benefit of:
Non Superannuation Assets Value Wife’s Commonwealth Bank accounts $37,694.27 Wife’s jewellery $1,000.00 Moneys loaned to U for car sales business $50,000.00 Total $88,694.27
In order to bring her to 50% she would need to receive a further $632,042.85 from the pool. The C property has an agreed value of $645,000. In order to retain the property the wife must pay to the husband the sum of $12,957.15. I will round that sum up to $13,000.
She will owe her lawyers $28,222 and will retain her superannuation of:
Superannuation Assets Value Wife’s T superannuation $224,756.55 Total $224,756.55
That would leave the husband with the benefit of:
Non Superannuation Assets Value Block of units at F, Lebanon $147,000.00 Husband’s Woolworths Ezi Card account $7,916.00 Husband’s bank accounts in Lebanon (at least) $552,363.97 Husband’s 1992 Ford Fairmont sedan $500.00 Payment from the wife $13,000.00 Total $720,779.97
He will retain whatever other assets he has and will owe $30,232.95 to his lawyers past and present.
Conclusion under Section 79
The effect of the orders will be to divide the assets so that the wife retains the C property subject to a small payment to the husband and otherwise the parties shall keep what they have. It is impossible to be confident of the overall effect of the orders in a case where the evidence about many issues was unsatisfactory. Nevertheless, in the circumstances and doing the best I can, in my view the outcome I have foreshadowed would be just and equitable pursuant to s 79.
As I noted earlier, the husband owes the wife $1,500 in respect of his contribution to the fees of Mr H, the lawyer/valuer who valued the property in Lebanon. I will simply make an adjustment in the final payment between the parties. Thus the orders will provide for a payment of $11,500 from the wife to the husband. I would normally make provision for the possibility of default of payment but in the circumstances am confident that the wife will be able to make arrangements necessary to meet her liability.
I certify that the preceding one hundred and sixty two (162) paragraphs are a true copy of the reasons for judgment of Judicial Registrar Ian Loughnan.
Associate:
Date: 17 July 2007
IT IS NOTED that this judgment for all publication and reporting purposes be referred to as AL-SADIKH & AL-SADIKH