Alexiou and Alexiou

FAMILY COURT OF AUSTRALIA

ALEXIOU & ALEXIOU

[2012] FamCA 1146

FAMILY LAW – PROPERTY SETTLEMENT – Add-backs – Whether expenditure of proceeds of trust be the wife should be a notional asset – use those proceeds were put to – Child Support – Whether payment of private school fees is appropriate.

Family Law Act 1975 (Cth)
Child Support (Assessment) Act 1989 (Cth)

C & C [1998] FamCA 143
Chorn & Hopkins (2004) FLC 93-204
Farmer & Farmer [2007] FamCA 158
Lightfoot v Hampson (1996) FLC 92-663
Mee & Ferguson (1986) FLC 91-716
Omacini and Omacini (2005) FLC 93-218
Stanford v Stanford [2012] HCA 52
T & T (1984) FLC 91-588
Townsend & Townsend (1995) FLC 92-569
Wild & Ballard (1997) FLC 92-771

APPLICANT:

Mr Alexiou

RESPONDENT:

Ms Alexiou

FILE NUMBER:

PAC

3070

2010

DATE DELIVERED:

14 December 2012

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Justice Le Poer Trench

HEARING DATE:

7-10 August 2012; 17 August 2012

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Wong

SOLICITOR FOR THE APPLICANT:

York Family Law

COUNSEL FOR THE RESPONDENT:

Mr Watkins

SOLICITOR FOR THE RESPONDENT:

Self represented

Orders

The parties are to jointly appoint an accountant to assist in the winding up of the companies X Investments Pty Limited and Z Finance Pty Limited. The parties are to then instruct the chosen accountant to cause the companies to be wound up. Each party is to do all things necessary to enable such winding up. The parties are to contribute equally to the cost of the winding up.
The wife’s application for a departure order in relation to the Child Support Assessment issued in respect of the children of the marriage is refused.
The orders made 10 August 2012 as “until Further orders” become final orders as part of these orders. Those orders are as follows:
1.That within 2 months from the date of these orders, the husband will do all acts and things and execute all documents necessary to transfer to the wife at the expense of the wife the whole of the husband's right title and interest in the property situate and known as 49 S Street, Suburb T in the state of NSW being the whole of the land contained in folio identifier … ("the No. 49 property").
2.That simultaneously with the husband’s compliance with Order 8 hereof, the wife will do all acts and things and pay all sums of money to discharge the parties' Westpac mortgage (comprising of Westpac Banking Corporation Loan Account numbers …704, …989 and …095) secured over the No. 49 property and pending the transfer pursuant to Order 7 hereof the wife shall make and be responsible for the payment of all moneys due and owing pursuant to the parties' Westpac mortgage secured over the No. 49 property and all outgoings in respect of the No. 49 property and the wife shall indemnify the husband in respect of all such outgoings.
3.That within 2 months from the date of these orders, the wife will do all acts and things and execute all documents necessary to transfer to the husband at the expense of the husband the whole of the wife's right title and interest in the property situate and known as 47 S Street, Suburb T in the state of NSW being the whole of the land contained in folio identifier … ("the No. 47 property").
4.That simultaneously with the wife’s compliance with Order 9 hereof, the husband will do all acts and things and pay all sums of money to discharge the parties' ANZ mortgage (being ANZ loan account number …694) secured over the No. 47 property and pending the transfer pursuant to Order 9 hereof the husband shall make and be responsible for the payment of all moneys due and owing pursuant to the parties' ANZ mortgage secured over the No. 47 property and all outgoings in respect of the No. 47 property and the husband shall indemnify the wife in respect of all such outgoings.
5.That the husband be responsible for and pay the agent's fees and solicitors fees payable in connection with the proposed sale of the No. 47 property in July 2012 and keep the wife indemnified in relation to the same.
6.That forthwith from the date of these Orders, the wife shall do all acts and things and sign all documents and provide all instructions necessary to cause the tenants of the No. 47 property, including providing any directions necessary to the tenants, to pay to the husband or as he may direct in writing all rental payments in connection with the said property.
7.That forthwith from the date of these Orders, the wife will do all acts and things and execute all documents necessary to transfer to the husband at the expense of the husband the whole of the wife's right title and interest in the parties’ BMW motor vehicle, 2006 model, registration number ….
The husband is to pay to the wife on or before the 15 April 2013 the sum of $120,000. The requirement to make the payment is to be secured against the property at 47 S Street, Suburb T.
Pending the payment of the said $120,000 together with any interest which might accrue on the sum if not paid by 15 April 2013 the husband is restrained from selling, further encumbering or alienating the property at 47 S Street, Suburb T, otherwise than for the purpose of raising funds to meet the payments to the wife required by these orders. Any funds so obtained are to first be paid to the wife to satisfy these orders before the husband otherwise deals with the property.
The wife has leave to apply for orders for the sale of the property at 47 S Street, Suburb T, and any other order to enforce the orders made herein including an order that she be appointed Trustee for the sale of the property.
Each of the parties otherwise is to retain any property which stands in their sole name.
All outstanding applications are otherwise dismissed.

IT IS NOTED that publication of this judgment under the pseudonym Alexiou & Alexiou is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: PAC3070/2010

Mr Alexiou

Applicant

And

Ms Alexiou

Respondent

REASONS FOR JUDGMENT

Introduction

The parties, Mr Alexiou (“the husband”) and Ms Alexiou (“the wife”), separated after 16 years of marriage. They are now in dispute about the division of their property. With the assistance of their lawyers they have been able to agree that at the date of their separation (25 December 2008) their contributions, when considered in all categories, are to be assessed as equal.
The areas of dispute between the parties which have caused an impasse arise in two main areas. The first relates to “add-backs” each contends for in the balance sheet and the other is the amount of adjustment which should properly be made under section 75(2) of the Act.
In the week before the hearing the wife filed an Application in a Case wherein she sought orders which would enable the sale of the property at number 47 S Street, Suburb T, for $700,000. The evidence she provided established that the mortgagee (ANZ Bank) had taken all necessary steps to be able to seek possession of the property and sell it. This had eventuated as a result of non-payment of the mortgage. The wife’s case was that the husband was (by agreement between them) to be responsible for the payment of that mortgage following the parties’ separation and that he had failed to maintain the payments.
The wife’s application was adjourned to the hearing of the Application for Final Orders listed the following week. The husband produced evidence that he had obtained a loan approval which would see him with sufficient funds to pay out the ANZ mortgage. Further the husband was seeking as part of the final property orders that he retain the equity in the property at 47 S Street, Suburb T.
Prior to the conclusion of the hearing the husband produced to the Court a final loan approval. Following that, the parties entered into consent orders which created a partial property order. The Court is asked to take that into account in the determination of the balance of the property of the parties.
The orders made are as follows:
“BY CONSENT AND UNTIL FURTHER ORDER IT IS ORDERED:
8.That within 2 months from the date of these orders, the husband will do all acts and things and execute all documents necessary to transfer to the wife at the expense of the wife the whole of the husband's right title and interest in the property situate and known as 49 [S] Street, [Suburb T] in the state of NSW being the whole of the land contained in folio identifier … ("the No. 49 property").
9.That simultaneously with the husband’s compliance with Order 7 hereof, the wife will do all acts and things and pay all sums of money to discharge the parties' Westpac mortgage (comprising of Westpac Banking Corporation Loan Account numbers …704, …989 and …095) secured over the No. 49 property and pending the transfer pursuant to Order 7 hereof the wife shall make and be responsible for the payment of all moneys due and owing pursuant to the parties' Westpac mortgage secured over the No. 49 property and all outgoings in respect of the No. 49 property and the wife shall indemnify the husband in respect of all such outgoings.
10.That within 2 months from the date of these orders, the wife will do all acts and things and execute all documents necessary to transfer to the husband at the expense of the husband the whole of the wife's right title and interest in the property situate and known as 47 [S] Street, [Suburb T] in the state of NSW being the whole of the land contained in folio identifier … ("the No. 47 property").
11.That simultaneously with the wife’s compliance with Order 9 hereof, the husband will do all acts and things and pay all sums of money to discharge the parties' ANZ mortgage (being ANZ loan account number …694) secured over the No. 47 property and pending the transfer pursuant to Order 9 hereof the husband shall make and be responsible for the payment of all moneys due and owing pursuant to the parties' ANZ mortgage secured over the No. 47 property and all outgoings in respect of the No. 47 property and the husband shall indemnify the wife in respect of all such outgoings.
12.That the husband be responsible for and pay the agent's fees and solicitors fees payable in connection with the proposed sale of the No. 47 property in July 2012 and keep the wife indemnified in relation to the same.
13.That forthwith from the date of these Orders, the wife shall do all acts and things and sign all documents and provide all instructions necessary to cause the tenants of the No. 47 property, including providing any directions necessary to the tenants, to pay to the husband or as he may direct in writing all rental payments in connection with the said property.
14.That forthwith from the date of these Orders, the wife will do all acts and things and execute all documents necessary to transfer to the husband at the expense of the husband the whole of the wife's right title and interest in the parties’ BMW motor vehicle, 2006 model, registration number …”

Orders sought by the parties

Each of the parties tendered a minute of the final orders sought during the trial. The wife’s minute was marked as exhibit W4 and the husband’s was marked as exhibit H7.
During the trial the parties agreed that the companies X Investments Pty Limited and Z Finance Pty Limited should be wound up. Consent orders in relation to that matter will be made by me.
In summary the wife seeks as follows:
·A payment of $172,593 from the husband.
·The transfer to her of 49 S St, Suburb T, subject to the existing mortgage which the wife is to pay.
·The transfer by her to the husband of 47 S Street, Suburb T, subject to the existing mortgage which the husband is to pay.
·The obligation for the husband’s payment to the wife to be secured against the property at 47 S Street, and if necessary, that property to be sold to provide the payment.
·Each party to otherwise retain the property which they personally own.
·By way of child support the husband pay one half of the children’s school fees for each of the children.
In summary the husband seeks as follows:
·The wife pay the husband $155,000 within 28 days.
·If the wife fails to make the payment, then the property at 49 S Street is to be sold. After discharge of the mortgage and the payment of sale expenses the husband is to be paid the money owing to him by Court order and the balance to go to the wife. There are other provisions about the sale and costs incurred readying the property for sale.
·Declarations as to the ownership of various companies and other assets. (basically each party retain as their own property assets which stand in their sole name).

Background Facts

Where in this judgment I make statements of fact they are, unless otherwise specified, my findings of fact.
The parties have agreed that until the date of separation, the contributions of the parties should be assessed as being equal. Accordingly, the facts I set out below are background to and related only to the issues in contention between the parties.

The husband was born in 1967 and the wife in 1969. The parties married in September 1992.

The parties purchased the property at 47-49 S Street, Sydney Suburb T, in 1997 for $405,000. The purchase was funded fully through a mortgage with Westpac Bank. The property was subsequently redeveloped into two properties. That development was completed in 2000.

In June 2002 the parties caused the establishment of the Alexiou Family Trust. There was a corporate trustee, namely X Investments Pty Limited.

In June 2002 the wife established the Ms Alexiou Super Fund. The husband subsequently transferred all his superannuation entitlements to that fund.

On 20 August 2004, the Alexiou Family Trust purchased two Lots at 7-11 B Street, Gold Coast suburb L, for the price of $255,000 each. The purchase price is covered entirely by mortgage, however, the parties disagree as to the bank which held the mortgage.

I note that there were other properties acquired and disposed of throughout the course of the marriage, each with attendant mortgages. I do not propose to outline those non-contentious transactions here.

It is the wife’s contention that between 18 December 2003 and 30 April 2004 her father, Mr Y, provided the parties with funds approximating $72,860, however it could have been $78,000. This is a contentious matter and I will refer to it later in these reasons.

In 2004 the parties caused the company Z Finance Pty Limited to be incorporated. It then became a vehicle through which the husband earned income.

In about 2004 the husband was diagnosed as suffering probable adult Attention Deficit Hyperactivity Disorder. He is prescribed medication to treat that condition.

In about 2005 the wife’s father was conducting a business which imported goods to Cyprus and Greece. The husband had an involvement with that business. There is issue between the husband and the wife’s father as to exactly what occurred in the business dealings between them in relation to that business. I will refer to that dispute later in these reasons.

In about 2005 the husband (or the parties) invested $95,000 of the Ms Alexiou Super Fund’s assets in Z Finance Pty Limited. The circumstances in which this occurred are not agreed. The parties ultimately agreed as to the value of the superannuation fund and no add-back was sought in relation to the abovementioned sum.
The ANZ Line of credit account was established at an unspecified point before 2006, at which time the parties purchased the BMW motor vehicle for the price of $105,000, the purchase price being paid using the ANZ line of credit. There is an issue as to which of the parties paid the loan instalments post-separation. The husband has had the use of the vehicle since separation.

In 2006 the parties’ children C and J commenced their schooling at M School. There is an issue as to whether the children should continue at that school. The husband asserts the parties cannot afford the school fees. The wife says there are special circumstances pertaining to why the children should continue to attend the school. I will refer to this later. An associated issue is whether the school fees paid by the wife from the sale of the parties investment properties at L in Queensland should be included as an add-back in the balance sheet. There would also be a consequent issue namely whether the school fees paid by the wife from a $200,000 draw down against the ANZ loan account …694 should be an add-back in the balance sheet. These matters will be addressed in these reasons.

In mid to late 2006 Z Finance Pty Limited ceased trading.

In mid 2006 to December 2006 the wife’s father requested $15,000 from his children. There is an issue as to how much money was provided by the parties. The wife says she provided $10,000. The husband says it was $22,500 provided in cash. The difference in the scheme of this case is immaterial. For reasons which appear later I do prefer the evidence of the wife on this matter.

In 2007, the wife incorporated the company R Group Pty Ltd, through which she conducted her business as a project manager.

In 2007 the parties separated their finances (there are issues about this time). The wife alleges an agreement that each party would pay a specific loan repayment. The wife says the parties agreed to each deposit $5,000 per month to a joint account. The wife says she was to transfer $135,000 from the ANZ loan account to the husband’s Westpac loan account so each party’s loan was being carried at the same financial weight. The wife did transfer that amount. There is contention about this.

On Christmas Day 2008 the parties formally separated. The husband had been living in a separate part of the home prior to that time.

The parties separated in December 2008. At the date of separation, the parties owed approximately $600,000 to Westpac Bank and $580,000 (home loan and line of credit account) to ANZ bank, as well as credit card debts. The properties they owned were:

a)47 S Street, Suburb T
b)49 S Street, Suburb T
c)Lot 9, 7-11 B Street, Suburb L
d)Lot 28, 7-11 B Street, Suburb L

The husband states that between December 2008 and May 2010, he made weekly repayments of $700 per week on the Westpac Equity Loan (account …713), which amount exceeded the minimum monthly repayment. The wife said that the balance as at December 2008 ($239,822.04) and at May 2010 ($246,650.64) indicated that the repayments were not sustained to preserve the loan increases on the account. The account was frozen in May 2010.

The wife said that from the date of separation, she continued to deposit her salary of $7000 per month into the Equity Access Loan …989, and has since separation applied more than $315,000 to the maintenance of the parties’ joint liabilities and costs of family living expenses. She also says that she applied a further $115,000 from her company R Group. The husband disputes this contribution.

On 12 January 2009, the wife, without the knowledge and consent of the husband, transferred $200,000 of available funds from the ANZ line of credit to an ANZ Online saver account in her name. She said that she had been advised to do that by her solicitor to prevent the husband withdrawing the funds. The husband says that the wife has not accounted for the money transferred ($45,372 is alleged not to be accounted for); the wife states that the money was used entirely to service loan repayments on joint liabilities, pay school fees, and pay maintenance and outgoings on the properties. I will address this issue of the ANZ loan draw down by the wife.

In March 2010, the wife withdrew $59,970 from her then available funds. The money was transferred to the wife’s father overseas in six instalments. The money was transferred, according to the wife, to partially repay a $78,000 (or $72,860) loan by the wife’s father to the parties. The husband disputes that the money provided by the wife’s father was a loan. He agrees the funds advanced should be returned to the wife’s father, however, he says that was done by various means before the parties finally separated. I will deal with this issue in these reasons.

In April 2010, the husband drew $4600 ($4633.02 per the wife) from the Westpac Line of Credit, Equity access loan …989 and the Westpac Classic Banking Account (acc …180). The husband deposited the funds in an account in his sole name.

Proceedings were instituted in this court in July 2010. The husband commenced to pay $62.00 per week in child support (increasing to $75.00 after 2 weeks) on 16 August 2010. A child support assessment was issued in November 2010 and the Child Support Agency determined that the husband should pay $842.00 per month.

In December 2010, the two properties in Queensland were place on the market by the wife. Lot 9 sold in February 2011 for $234,000, and Lot 28 was sold in March 2011 for $230,000. The mortgages on these properties were fully discharged and the remaining proceeds of sale were applied by the wife to pay tax owing to the ATO, interest on the ANZ line of credit, the 2011 M school fees for the children, and $31,707 paid into the wife’s personal account for the children’s expenses. The husband states that he did not consent to the proceeds being applied to the children’s school fees or in any other fashion. He seeks an add-back in the parties’ balance sheet fro the wife’s expenditure of those funds.

In September 2011, the wife applied $6,230.54 from the proceeds of the sale of the properties in Queensland to an overseas trip for the child C. The remainder of the sale proceeds thereafter remaining (being $26,200) were paid to the children’s school as payment toward their tuition fees for the 2012 school year. The husband agrees that the payment for C’s overseas trip was a proper expense to pay and is not seeking an add-back of that amount.

On 22 December 2011, there was an incident in which the wife caused to be delivered to the husband’s parents’ house a truckload of home contents. There is dispute as to whether this delivery had been pre-arranged. The husband’s parents refused delivery, and the wife caused the contents to be placed on the front lawn. The police were called, and the contents were deposited in a storage facility. The wife states that the husband was responsible for the payment of the rental agreement for the storage facility. The contents of the storage facility were sold in May 2012 after the rental agreement fell into arrears. Each party says that they did not receive any money from the sale.

The wife’s company R Group ceased trading in December 2011. She says that she had come to the end of her contract with A Bank and wound the company up. She then commenced to be employed with another consulting firm which had a contract with A Bank.

In April 2012, the ANZ line of credit secured over no 47 S Street became “in default” and the ANZ Bank commenced enforcement proceedings. The husband says that the wife had redirected the rental from 47 S Street from the repayment of the mortgage on the property. The wife disputes that assertion.

In June 2012, this matter came before me in relation to the sale of 47 S Street. The mortgage secured over the property had fallen into arrears. I dismissed the wife’s application for each of the parties to pay half of the amount in arrears. I dismissed the application, as the evidence before me was that the Bank had indicated that they were not going to intervene immediately.

On 21 July 2012, 47 S Street went to auction with an agreed reserve of $750,000. The property did not sell on that day. An offer of $700,000 was made on 24 July.

On 25 July there was an offer by the husband to retain the property at the value of $700,000. The wife made an application to proceed with the sale at $700,000. The husband responded by offering to refinance the mortgage on the property into his name. The matter came before me on 1 August, however, I made no orders on that date as the final hearing was to be held in the following week.

The Issues

The issues in the case have been identified in the words set out above.

Credit

The Wife

The wife gave her evidence in an apparently straight forward and honest manner. She was verbose, however that verbosity appeared to have been caused by her need to justify the position she took in drawing down $200,000 from the parties’ loan facilities shortly after separation and then applying that to support herself and the children at least as to part. She also paid private school fees which the husband says she should not have done.
The wife supported her evidence about the way in which she dealt with the parties’ assets post-separation with volumes of documents and thus most of her evidence in that regard was corroborated. One area of dispute between the parties which was not well corroborated with documents related to the wife’s allegation that the parties, at separation, owed her father about $70,000. The husband, whilst acknowledging that the wife’s father had advanced the parties money, said it was $60,000 and that it had been repaid over a series of years and through various transactions.
In the wife’s evidence she identified a specific sum as having been deposited by the parties into their accounts which had its source in the advance from her father following the sale of property he owned in Australia. That amount was $72,860. The wife’s father in his affidavit evidence also adopted that figure. He did so having spoken to his daughter to see if she had any particular document which identified the exact sum as he was unable to remember it. He was sure the sum provided to the parties was in excess of $70,000. Likewise the wife was certain her father advanced in excess of $70,000 to the parties.
The wife acknowledged in cross-examination, she had found, in the preparation for the hearing, evidence which proved the existence of a particular deposit of $72,860 in the parties’ bank accounts at about the time she recalled her father paying the money to the parties. The wife further acknowledged that she had since ascertained that the particular deposit she was noting in the parties’ bank account details was not related to a fund received from her father. She said that when that error became apparent she searched other records which related to bank accounts which had been closed. She said she found records of deposits which may well have been the funds advanced by her father. She did not have those records at Court with her. Notwithstanding those circumstances, I do accept she did find such records however it must be acknowledged she was not in a position to positively prove the funds recorded in those records came from her father.
Overall I found the evidence of the wife and her father more credible than that of the husband in relation to the debt alleged to be owing to the wife’s father. Further, there are other aspects of the husband’s evidence which would make me prefer that of the wife in most areas of conflict in their evidence.

The Husband

The husband gave his evidence in a polished and apparently straight forward manner. At one point, he appeared to me, to feign misunderstanding of what he was being asked, however, generally he seemed to answer questions spontaneously and in an apparently honest manner. The area of his evidence which caused me concern and in relation to which I say he apparently feigned misunderstanding, related to his oral evidence about the amount of child support he is or has been paying.
As I have said I do prefer the evidence of the wife and her father about the disputed loan from the wife’s father to the parties. The husband’s assertions, about the repayment of the loan, were denied by both the wife and her father. Further in relation to this issue of fact the husband had been inconsistent in his sworn evidence provided to the Court. The wife tendered an affidavit of the husband sworn 30 June 2010. That affidavit had been filed by the husband in the Federal Magistrates Court at Parramatta (exhibit W3). At paragraph 9 of that affidavit the husband said:
Respondent (the wife) then proceeded to withdraw, without the applicants knowledge,… from ANZ Equity Manager account …694 Joint account of [Mr and Ms Alexiou], and transferred to Cyprus into Respondent’s fathers account being for a supposed loan. No loan documentation nor knowledge of such a loan was received. Currently in dispute.
The above extract from the husband’s affidavit of June 2010 is very different to the evidence he gave in his affidavit filed in this Court at paragraph 93 and following. There the husband expresses a very clear understanding of the original transactions, although he differs in the amount of the sum provided by the wife’s father.
There is other evidence from the husband which I consider was designed to deceive the Court and the wife which reflects badly on the husband’s credit. That evidence relates to the money he claimed in his Financial Statement to be paying to his parents as board. He has lived with his parents since the separation in December 2008. At item 21 of his Financial Statement sworn 20 June 2012 he stated “Rent/Board to parents- [Mr and Ms Alexiou Snr] $300”. In his oral evidence he said he does not pay the board to his parents, rather he pays it to his brother. He told me his parents refuse to accept board from him. He stated he pays the funds to his brother who then uses the funds to provide benefits by way of gifts to his parents. The husband’s parents are pensioners.
I consider it is most unlikely that the husband’s parents refuse to accept money from him for some cultural reason (as the husband told the Court when questioned about the matter). I consider the arrangement is either designed to ensure the husband’s parents do not suffer any diminution in their pension as a result of the husband paying rent or, alternatively, it is some attempt by the husband to avoid the payment of either mortgage commitments the parties have (a result sought by the wife for a considerable period) or alternatively to avoid being found to have capacity to contribute to the children’s school fees, again a matter pursued by the wife. The circumstance, which I consider most probable, is that the husband is actually contributing to his parents’ household in a manner which will not affect their pension.
Whatever may be the true position with the payment of the board to his parents, it is the attempt to deceive the Court which raises concerns on my part about the husband’s veracity in relation to the balance of his evidence where there is an issue of fact. In such circumstances, I prefer the evidence of the wife unless I specifically say otherwise in relation to a particular fact issue which I need to determine in this case.

Mr Y, the wife’s father

Mr Y is the wife’s father. He swore an affidavit on 22 May 2012. He travelled to Australia from his home in Cyprus in order to give oral evidence.
The wife’s father presented as a truthful witness. He was cross-examined about the claim he made about the debt due to him from the parties arising from an advance he made to them following the sale of a property of his in Australia.
I do accept his evidence that he advanced funds to the parties as a non-specific loan and that the sum was in excess of $70,000.
There was cross-examination of the wife’s father in relation to his business dealings with the husband. I accept Mr Y may have been confused in relation to how some of the invoices, which he received for goods ordered by him from China, were paid. I do not accept the assertion that the husband either directly or indirectly funded some of those orders in circumstances where he did not ultimately receive payment from the wife’s father. I make no finding on the allegation or innuendo that the husband and a business partner of his were profiting from the transactions arranged by them on behalf of Mr Y before he commenced dealing directly with Chinese suppliers.

Oral Evidence

Husband’s Oral Evidence

The husband gave evidence in Chief. He used this opportunity to correct portions of his affidavit. Corrections were made by him to paragraphs 11, 28, 43, 61, 63, 65(e), 82, and 112 (in two places). No explanation was provided by him as to why it was necessary to make those corrections. In other words, he did not inform the Court why he was not able to accurately record in his sworn statement, contained in his affidavit, evidence which he was asserting to be the truth.
The husband was cross examined.
The husband agreed that at the date of separation, the parties owned adjoining properties in S Street, Suburb T, together with two properties in Queensland. The husband conceded that the wife managed the investment properties.
The husband asserted that prior to separation, and in fact in May 2008, the parties had separated under the one roof and the husband was living in the garage. He said the wife wanted to invest more money and he did not. He said “we split the responsibility for the loan repayments.” The husband said he was to be responsible for meeting the Westpac loan on account …095. The husband had been unemployed in 2008 from October until March 2009. From May 2008 until April 2010, any income earned by the husband was deposited into the Westpac account number …095 and he drew against that account to meet his expenses. Following the separation, he agrees he made no payment towards any other loan liability. The husband said that in March 2009, the debt on the Westpac account was $283,488. He said that in April 2010 it was $242,058. During that period, the husband paid not only the interest accruing on the loan but also additional capital.
The husband agreed that on 12 January 2009, the wife drew down $200,000 against the ANZ account number …694. He agreed that the wife has provided him with a spreadsheet showing her expenditure in relation to that account. The husband acknowledged he received the spreadsheet after August 2010.
The husband acknowledged that prior to separation, by agreement between the parties, the husband was contributing $5000 per month to the general expenses of the household in which the husband, wife, and children lived. He further agreed that after December 2008 he was no longer making that contribution.
The wife through her company R Group Pty Ltd acquired a BMW motor vehicle after separation. At the time of separation the husband took with him the parties’ BMW motor vehicle. He was asked whether he had any objections to the wife having the same type of motor vehicle as he did to which he replied “no”.
The husband was asked about his living arrangements post-separation. He agreed he had been living with his parents. He asserted that he was paying board of $300 per week. He agreed that the $300 per week was paid into his brother’s bank account. The husband said he would like to move out of his parents’ house.
In relation to the disposition by the wife of the proceeds of the Queensland property sales, the husband agreed that a payment of $31,707 to ANZ account …038 was an appropriate payment. He also agreed that a payment of $6230 towards accommodation for C when she travelled overseas was an appropriate payment. He submits the balance of the proceeds should be included in the balance sheet as an add-back.
The husband asserted that he was paying child support of $964 per month since August 2012. He claimed that before that, he was paying $1547 per month. He did not know for how long he paid that larger amount.
The husband was invited to look at part N of the wife’s Financial Statement. He was asked to identify any expenses which he claimed were unreasonable. He claimed the unreasonable expenses included household repairs, telephone for the children, clothing and shoes for the children, the children’s activities, entertainment and hobbies, holidays for the children, and expenses including chemist, gardening and mowing, pool cleaning, dry cleaning, magazines and books, hair dressing and toiletries.
The husband told the Court that he had been unable to accumulate any savings since separation because he had been paying legal fees.
The husband was asked about the parties’ liability to the wife’s father. His attention was drawn to paragraph 93 of his affidavit filed 23 July 2012. In relation to the conversation set out in that paragraph, the husband said “he distributed to his children as a gift, however, we insisted it should be paid back.” The husband claimed that it had been repaid. The husband agreed that in paragraph 120 of his affidavit, he described the payment made to the wife’s father as a repayment of a loan. He finally conceded in cross-examination that the transaction should properly be described as a loan.
It was put to the husband that in his affidavit filed in the Federal Magistrates Court on 30 June 2010 he referred to the transaction, whereby funds were advanced by the wife’s father to the parties, as a loan. It was put to the husband that he did not assert in the affidavit the loan had been repaid. His answer was proposition “I prepared the affidavit myself”.
The husband was asked about the difference between his statement in para 10 of his affidavit that he had an annual income of $129,000 and the statement in his Financial Statement that he had an income of $1815 per week ($94,380 per annum). He asserted that the figure in the Financial Statement did not include a bonus. He also conceded that the superannuation deduction referred to in his Financial Statement should not be recorded as a deduction as it is not deducted from his income.

Oral evidence of the Wife

The wife was cross-examined by the husband’s counsel. The wife conceded that the balance of the Westpac account at 22 December 2008 was in debit to the sum of $277,408. At May 2012, the balance was $277,854. As at the date of the hearing, the wife said the balance was about $280,000 in debit. The wife said that in May 2008, the husband took over responsibility for the payment of that loan.
The wife agreed that in May 2008 she took over responsibility for payment of account number …694 to the ANZ Bank. As at 16 December 2008, she agreed that account was in debit $220,367. She further agreed that on 21 January 2009 she withdrew $200,000 from that account. The balance then became $420,000 in debit or thereabouts.
The wife agreed that in May 2008, she agreed to take on responsibility for meeting the parties’ commitment in respect of ANZ loan account …694. However, she said that was on the basis that each of the parties contributed $5000 to the parties’ general living expenses. The wife said that the parties had contributed $5000 per month each to a Westpac line of credit account numbered …989. The wife said that in May 2010 she ceased using the account because the husband accessed the account and took all the funds. She agreed that at the date of separation, the account had a debit balance of $20,780. I note that at page 256 of the wife’s exhibits to her affidavit, a bank statement for the Westpac account numbered …989 shows that the account was taken to its limit of $25,000 on 29 April 2010 by an internet online banking transfer of funds of $4591.72. The last deposit to the account the wife’s pay which occurred on 23 March 2010 when she deposited $7000 into the account.
The wife agreed that as at the date of hearing the account with Westpac …989 stood in debit to the sum of $25,000.
The wife was then taken to account number …704 with Westpac, being a loan titled “premium Option Home Loan”. Details of the account appear at page 135 of the annexure to the wife’s affidavit. The wife agreed that as at 2 December 2008, the balance of the account was $329,562 in debit. The wife agreed that the rental from 47 S Street property was ultimately deposited to that account. The wife agreed that at the date of trial, that account stood in debit $306,000 or thereabouts. The wife agreed that as at December 2008, the interest repayment on ANZ loan account …694, which had a balance of about $220,000, was $1353 per month. She further agreed that after she withdrew the additional $200,000, the interest payment on the then balance of about $421,000 was $2253 per month.

It was put to the wife that the rental received from the Queensland properties covered all the outgoings in respect of those properties. The wife disagreed and said there was a shortfall of between $5000-$6000 per year.
The wife agreed that from the sale proceeds of the Queensland properties, she paid $37,069 to M School on account of the children’s school fees, and she paid $31,707.81 to an ANZ account, the account being …038. That was an account in the wife’s sole name.
The position with the receipt by the wife of the net sale proceeds of the sale of the Queensland properties and the application of the funds is confused when considering the oral evidence of the parties and some of their written evidence. The wife annexed to her affidavit at pages 759 and 760, being the settlement statement in relation to the sale of the second of the two properties. It appears common ground that the whole of the available funds from the sale of the first of the Queensland properties was applied to the mortgage liability secured over both properties.
Page 760 of the annexure to the wife’s affidavit shows the following available funds were distributed:
M School                  $37,069.00
ANZ Bank                 $132,057.04
Ms Alexiou (wife)    $10,000
Ms Alexiou               $31,707.81.
It seems clear therefore that the wife received, either directly or indirectly $78,776.81. Of that sum the wife applied $6,230.54 to the payment of the overseas trip for the child C. The husband agrees with that payment. The net benefit received therefore was $72,546.27. The wife said she then applied part of the proceeds to pay school fees for the children amounting to $63,269. The wife applied $13,180 to reduce the ANZ loan account 0694. If the wife be permitted to apply the proceeds to pay school fees and reduce ANZ loan account …694 then that means the amount applied to other purposes by the wife was $2,327.81.
The wife agreed that in the 2011 tax year, she received $120,000 as salary from her R Group business. She agreed that she received the same income in the 2010 year. The wife agreed that in addition to her salary she received a dividend of $20,000 from the R Group in the 2011 Tax year. The wife said that the dividend arose from the fact that the company was being wound up and as there was a loan in the company to the wife, it was necessary to pay it by way of dividend.
The wife agreed that in the 2011 tax year she received net after tax payments of $85,000 from the company R Group. She also agreed that in the year ending 30 June 2011, the director’s loans stood and $54,572 in debit. The wife said she had probably applied that to meet legal fees. The wife agreed that she used some money drawn from the ANZ account number …694 to pay living expenses. The wife denied that she had received for the year ended 30 June 2011 $54,572 of net benefit from R Group. She said that the loan account of $54,572 represented the totality of the account for the period 2009 through to 2011. She had drawn against that loan account during those years. The funds were drawn, she said, to pay legal bills.
The wife’s attention was taken to exhibit H4. She agreed that document showed receivables from shareholders. She agreed it shows $88,000 in retained profits in the company as at January 2012.
Exhibit H4 is a balance sheet for the R Group Pty Ltd as at 31 January 2012. Under the heading “Assets” on the first page of the document is a sub-heading “Amounts receivable from Shareholders.” That shows that in 2010, the wife borrowed $43,547; in 2011, the wife borrowed $54,572; and in 2012 the wife borrowed $20,999 as at 31 January of that year. It is also noted that under the heading “Liabilities” is included superannuation $15,660; income tax $12,357; GST on supplies $16,584; PAYG withholding tax $6300.
As a result of the above it seems clear that the wife did borrow a total of $54,572 from the company in the 2011 financial year rather than that figure being an accumulation of borrowings she had made over a number of financial years.
The wife was asked about her current occupation. She was, at the time of the hearing, filling a six week vacancy at a High school where she was employed as a teacher. She said that she would be endeavouring to obtain employment in the IT sector in the future, as she could not live on a teacher’s salary.
The wife said in answer to a question that she had “eaten into her capital” since separation, that she had continued doing what she could to work hard. She said the husband had only paid $23,000 by way of child support over three and a half years. She complained that every few months, he applied for reassessment. He is paid a commission every month and if his commission is less than he expected he asks for a reassessment by the Child Support Agency.
It was put to the wife that had she not drawn against company loan accounts she would not have been able to pay for the children’s private education. She replied that she did not agree with that, that she had in fact paid $130,000 to lawyers. If she hadn’t had to pay her lawyer, she would have had the capacity to meet the children’s school fees without borrowing. She denies that she had used the additional $200,000 borrowed post-separation to support an unsustainable lifestyle.
In relation to the children’s schooling, the following was put to the wife:
In 2009 the husband suggested the children could change schools?” The wife replied “he did, but it was not the right thing for the children. We had a lot of trouble in another school with [C]. We went to the school and he agreed to the school.
It was put to the wife that she had agreed to pay for the school fees by herself. She replied “Not quite. I asked him many time to help pay. I said if it came to the final thing, I would pay for the children rather than have them suffer a change of school.”
The wife was asked about the receipt by her of her inheritance from her mother. She had set out in a note to her Financial Statement sworn 6 August 2012, that she had received $184,316.15 as an inheritance from her late mother and there was $5287.15 remaining. She then set out details of how she had applied those funds. They were applied as follows:

a)$67,005 in payment of legal costs
b)$63,524 to M school fees
c)$23,500 to the Australian Tax Office
d)$5000 in repayment of a loan to her brother
e)$20,000 in car repayments to BMW finance

She had received the money in May 2012. The wife acknowledged that she did not tell the Court when she applied post-May 2012 for the husband to pay one half of the contributions required on the mortgage account that she had received an inheritance from her mother’s estate. She asserted that she had, at p 39 of her affidavit sworn 7 June 2012, provided details of the inheritance. She said that the affidavit had in fact been prepared at an earlier time, but not signed until l7 June 2012.
The wife agreed that she had this year applied to the Child Support Agency for reassessment of child support due to the fact that she was no longer working and earning a comparable income with that she had earned last year.
The wife was asked about a dispute between she and the husband about the time the child J was spending with him. She said “Yes, in May 2011 we came to Court. Thereafter the husband refused to see the children for five months. He delivered a letter to [J’s] school explaining to [J] that it was mummy and her solicitor’s fault. About two weeks before October 2011 hearing, he said to [J] that she could come and stay with him now. She stayed for three weeks of the school holidays. At the end of that time he retained her and said she wanted to stay with him. There was ongoing conflict about changeovers and in February 2012 an order was made for [J] to spend 4 days each fortnight with him. That is the current arrangement.” It was put to the wife that the husband had J with him for 90 out of 130 days prior to 31 December 2011. She said she did not know if that was correct.
The wife was asked whether she had since separation travelled to Dubai. She said in July she went to a conference. It was put that since December 2011, when her bank accounts went into default, she had not dropped her expenditure level at all. She denied that. She agreed that she had on 16 December 2011 spent $400 at a Chanel boutique. She agreed that in October 2011, she went overseas to see the parties’ daughter C.
She was questioned about the alleged loan to the parties from her father. She denied that the amount of money provided to she and the husband was only $60,000. In relation to her assertion that the amount borrowed was $72,860, she said that her accountant had found that deposit. She said then she found a deposit of $78,000 in a closed account. She agreed that the deposit of $72,860 identified by her as the amount coming from her father had not come from her father at all. She agreed that she had told her father that she had found that deposit. She denied that she had paid her father $22,500 in 2006 and she asserted that it was only $10,000. She said that at the time after that $10,000 had been paid she knew that there was still $60,000 owing to her father. She agreed that Z Finance paid invoices on behalf of her father, however, she said that the purpose was to obtain some tax benefit for the husband and Ms F. She said she knew that the husband used the invoices to obtain tax benefits because she did the accounts. She denied that Ms F was a supplier, and asserted that she was a mediator.

Oral evidence of the wife’s father

The wife’s father was cross-examined about his allegation that he had transferred to the husband and wife the sum of $72,860. It was put to him that he had transferred $60,000 only. He denied that he had transferred only $60,000 to them. He agreed that his daughter had suggested to him a date of 18 December 2003, which is the date he provided funds to the parties. He agreed that she had told him her records showed that date. He agreed that he could not recall the exact amount, however, he was sure that it was more than $72,860. He denied emphatically that it was only $60,000.
The wife’s father said that in about 2006, he asked the parties for $10,000 to cover the cost of an angiogram. He denied that he asked for money to buy property in Cyprus in 2006. He agreed that in about 2006, each of the children sent him $5000 for an ear operation. He said that the parties had sent him $10,000 in 2006. He said the money had been sent to his bank account, but he did not have records of same to produce to the Court. He said that in 2006 he had bought a car for $16,000 in Cyprus, but that was purchased from money he had taken himself to Cyprus.
The wife’s father agreed that in about February 2005, he spoke with the parties about a business he wished to establish, being importing goods to Cyprus. He wished to purchase the goods from China, however, he did not know anybody in China with whom he could deal. He said the husband had told him he knew a woman called Ms F who would be able to help. The wife’s father said that the arrangement was that he paid money to a certain account and then supplies would arrive some months later. He said the husband had sent him a statement which he paid to the bank in Cyprus and then three to three and a half months later, a small quantity of goods arrived. He claimed to have gone together with the husband to an Australian company to negotiate in relation to the purchase of goods. He denied that the husband had paid invoices for product on his behalf. He said the invoices were sent to him and he paid for them from Cyprus. It was put that the husband had paid a company in Korea for products. The wife’s father denied that and said he paid them out of his bank account.
The following was put to the wife’s father “I’m going to suggest it was the case [Z] Finance paid the invoices?” the wife’s father responded “I don’t know which were from, but I paid the bank, and they sent the money, and I received the product later, and one time I paid for … supplies about six months later when the [goods] had not arrived, I went to China myself to see what was happening and when I was there I was told that [Ms F] was [the husband’s] partner and that the money was in Australia. When I told [the husband] I was going to tell Interpol, money was in my account in Cyprus within three days.”
It was put that the husband had bought computers for the wife’s father’s business. He replied “no, they gave me their old (or own) computer so I could learn how to use it.” In relation to the payment of suppliers, the wife’s father claimed he had paid the suppliers directly. He said he paid the invoices the husband had sent him. In answer to a question from myself that I was not clear what his evidence was, the wife’s father said “according to the statements, the money was coming to Australia and [Ms F] and [the husband] were paying the invoices.”
The wife’s father was cross-examined about a statement he made in his affidavit that he had paid $8000 in cash to the husband. He was asked “If you were paying the invoices, there would have been no necessity to pay [the husband] $8000 as you said?” The wife’s father responded “No, they are different things, that was for [goods] that I did not ever receive. The goods were never received. When I came to Australia, I got some money from my brother and he said (that is, [the husband]) he had never had so much cash in all his life.” This was reference to a shipment of goods which was consigned to Mr Y and apparently destroyed by Custom Authorities (I understand in Cyprus). The wife’s father denied the proposition that the goods which were ordered and burnt by customs was an order made by his order. He denied emphatically that prior to separation the husband and wife would give him sums of $2000 in cash whenever he came to Australia. It was put that suppliers of goods for Mr Y’s business sent their invoices to the husband by email. The wife’s father said “yes and then [the husband] sent them to me”. The witness was asked would he give an authority so that the husband could obtain copies of invoices issued between 2005 and 2009. He replied yes.
I conclude in relation to the evidence given by this witness that for some time whilst he was conducting the business of buying goods through the parties’ company Z Finance Pty Ltd he paid for the goods by transferring funds to that company upon receipt of an invoice which may have been from either the company itself or from the Chinese supplier. At a later time I accept the witness dealt directly with the Chinese suppliers of goods.

property: general principles

Section 79 of the Family Law Act 1975 (“the Act”) enables the court to make orders with respect to the property of the parties to the marriage. Before considering making an order the court is to ensure compliance with section 79(9) of the Act.
Having identified the property of the parties, and the legal and equitable interests they each hold in such property, the Court is required to consider whether in the particular circumstances of the case it would be “just and equitable” to make any order altering any of the parties’ property interests (s79(2))(Stanford v Stanford [2012] HCA 52). The Court is not to make any such order unless it is so satisfied. If the court is satisfied an order for alteration of property should be made then in considering what order, if any, should be made the Court is required to take into account the matters under s 79(4) together with matters set out in the other subsections of s 79.
Assuming the Court is satisfied that is just and equitable to make an order altering the parties’ interests in their property then the process for determining what order to make requires the Court to:
·Determine the value of the parties’ net assets, superannuation and resources;
·Assess the contributions of the parties pursuant to s 79(4)(a),(b) & (c);
·Take into account the matters set out in s 79(4)(d),(f) & (g);
·Consider the relevant s 75(2) factors.
Before making a property order, having addressed the matters referred to above, the Court is to only make an order which it considers to be just and equitable in the particular circumstances of the case.

Assessment of the s 79(4) contributions

In considering the alteration of property interests I am required to consider the contributions made by the parties in accordance with the matters outlined under s 79(4). Section 79(4) provides:
(4) In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(a) the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c) the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d) the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
(f) any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
Should I be required to consider the matters set out in section 79(4) in this case then I propose to firstly consider sub paragraphs (a), (b), (c), (d), (f) and (g). I will then separately consider subsection (e). This is part of the approach endorsed by the Full Court.

Section 75(2)

In making a decision in relation to property, s 79(4)(e) requires a consideration of relevant s 75(2) matters. I here incorporate the provisions of section 75(2).

Section 79(9)

Have the provisions of s 79(9) been complied with?
·In this matter the parties met with a Registrar of the court who conducted a conciliation conference on 18 May 2011
The section has been satisfied and the Court can, should it be necessary, proceed to make an order altering the property interests of the parties.

The property of the parties.

The Court at the commencement of the hearing was provided with the balance sheet set out hereunder for its consideration.

The Balance Sheet

The parties tendered an agreed balance sheet which contained identified areas of dispute. That document was marked as exhibit X2. It is as follows:

Assets	($)
1	Joint	49 [S Street], [Suburb T]	837,500
2	Joint	47 [S Street], [Suburb T]	700,000
3	Joint	BMW [motor vehicle]	28,000
4	Joint	[X] Investments Pty Ltd plus The [Alexiou] Family Trust	nil
5	Joint	[Z] Finance Pty Ltd	nil
Total Assets	$1,565,500

Addbacks Sought	($)
7	H	Proceeds of sale of Honda Motorbike sold 12 November 2011	4,000
8	W	Proceeds of [Queensland] properties, …	76,449
9	W	Funds withdrawn from ANZ Equity Management Account Line of Credit …694 to Cyprus	59,970
10	W	Funds withdrawn from ANZ Equity Management Account Line of Credit …694	200,000
11	H	Money paid to Husband’s brother’s bank account by the husband	54,600
Total Addbacks	$395,019

I find the evidence supports the following finding in relation to the husband’s post separation contributions.
·The husband received an income post separation which I have found totals $289,048 after tax.
·The husband has made a contribution to the support of the children post separation through the payment of child support (totalling $23,000 at the date of trial).
·The husband has made a contribution as a parent to the care of the children during the time he has spent time with them. The wife has spent a greater amount of time overall in caring for the children during the post separation period and there was a period of time as evidenced by the wife when the husband did not spend any time with the children. There was another period of time when the husband kept J following a period when she spent time with him and thus he had greater involvement with her care during that time. During the time the children spend with the husband he is required to pay for their needs. I accept the husband’s evidence that he has spent about $15,000 post separation in meeting the children’s expenses. The husband included a schedule of expenses he had extracted from his bank records (annexure “E”). That schedule itemises expenditure which largely relates to entertaining and feeding the children whilst they are with him.
·The husband applied part of his income to the payments required on Westpac Loan …095. He paid money against the loan and considerably reduced the indebtedness from the date of separation ($277,409) until May 2010 ($243,340) when he ceased making payments. The indebtedness then increased ($280,470) due to non payment.

Assessment of contribution to Superannuation

The wife submitted the parties contributions to superannuation should be assessed by inclusion in the one pool with the parties’ assets.
The husband made no submission as to separate contribution to superannuation. His submissions were directed to the total pool of assets and superannuation which was, in my view, a sensible and appropriate approach.

Conclusion based on contribution

The wife submitted that the contributions should be assessed as 60 per cent to the wife and 40 per cent to the husband at the date of hearing. The husband contended for a finding of equality at the date of hearing. That submission was made in circumstances where the contributions made by the wife from her inheritance had not been considered as she pressed for it to be taken into account under s 75(2). I propose to consider the wife’s inheritance in assessment of contribution limited by what is set out above under the heading “Section 79(4) contributions post separation”.
The husband submitted that the contributions of the parties overall should be assessed as equal at the date of the trial. In the event that the court considered the wife’s contributions were greater particularly having regard to her contribution as a parent then the adjustment to her should be no more than 5 per cent.
All in all, I assess the contributions of the parties to the acquisition, conservation and improvement of the property of the parties to the marriage or of either of them, including such property which is no longer the property of the parties to the marriage or either of them, to be 60 per cent to the wife and 40 per cent to the husband as at the date of the hearing.
Such a division of the net assets would see the wife having $420,022 of asset and superannuation and the husband $280,014 of same.
The wife’s entitlement includes $122,885 in superannuation whilst the husband’s entitlement includes $104,125 in superannuation.

Section 75(2) considerations

I now turn to consider the matters prescribed in s 75(2) of the Act.
The husband is 45 years of age and the wife is 43 years of age. The husband has suffered from depression in the past, however, there is no evidence that the ailment does cause him poor health presently, nor has any evidence been provided to show it may affect his earning capacity in the future.
The income, property and financial resources of the parties have been extensively canvassed in these reasons. Both parties have adequate physical and mental capacity for appropriate gainful employment. Both have high incomes by community standards.
The parties have two children. Ch is 16 years old and J is almost 12. The children live with the wife mainly and spend time with the husband. J spends more time with the husband than does C. J spends overnight time with the husband however C does not. C will complete her high school education in 2013.
One of the issues in the case has been the payment of private school fees. The wife has been absolutely determined to keep the children in their present schools; so much so that she has applied a significant portion of her inheritance to pay the children’s school fees to the end of 2013. Thereafter she will no doubt seek the husband contribute to the schooling costs for J. I consider the prospects of the husband being required to contribute to the private school fees beyond 2013 are slim given his present rate of income and the current impost of child support. If he is required to contribute I consider it will be at a lesser rate than the wife will have to meet. I consider therefore that there is a probability that the wife will be required to contribute at a higher rate than the husband to J’s education costs in 2014 and beyond. As can be seen by the payments made so far by the wife the payment of J’s school fees will have a considerable impost upon the wife’s income and resources.
The commitments the parties each have to support themselves and their children are set out in their Financial Statements and other evidence in the hearing. I have had regard to that evidence. Neither party has responsibility to support any other person.
There is no evidence to suggest either party is eligible for a pension allowance or benefit otherwise than as disclosed in relation to their individual superannuation.
During the marriage the parties collectively earned a high income. They applied those incomes to grow their assets and establish trusts for the benefit of their children and themselves. Since the separation the wife has been able to enjoy some overseas travel which was partly associated with her employment. The husband has been able to take the children on interstate holidays. I conclude the parties lived a reasonably high standard of living whilst together.
The orders sought by the parties or envisaged by the court will not adversely impact upon any disclosed creditors of the parties.
The conclusion based on assessment of contribution would see the wife receiving $140,008 additional in net asset and superannuation than the husband in a total net pool of $700,036.
The husband is assessed to pay child support as specified in these reasons. He is meeting that commitment. It will continue until J turns 18 years of age.
As set out earlier in these reasons, I have determined I will not include in the balance sheet a notional asset representing the draw down by the wife of $200,000 against the parties’ loan facility with the ANZ Bank and being account …694. I now need to consider whether in all the circumstances surrounding the post separation financial dealings of the parties any further adjustment needs to be made to the conclusion reached in relation to the assessment of contribution to the marriage as at the date of trial. In determining this matter I take into account all of the material appearing under the heading “Item 10 on exhibit X2 the $200,000 drawn by the wife from the ANZ loan account …694 shortly after separation” as it appears earlier in these reasons.
The matters which stand out as the most influential in this determination are matters which have, in some cases, been considered in assessment of contribution, above referred to and I am conscious of that fact and the necessity not to “double count” in this exercise, however there are some relevant aspects of those contributions which need to be considered in this discrete exercise which is really to determine whether on balance the wife has achieved an unfair advantage over the husband by my determination not to include any “add-back” for the $200,000 drawn by her from the parties assets at separation.
The stand out matters for me are as follows:
·At separation the debt to the bank was $220,367 on the loan. At the date of the hearing the debt was $480,000.
·Post-separation the wife received funds of $970,390. She expended $753,069 on the matters set out in the table included in these reasons. Those payments did not include ordinary living expenses.
·Post-separation the husband has paid child support which has totalled $23,000. Although significant, the payment is minimal when averaged out across the three and a half years of separation.
·The husband met the payments in respect of Westpac Loan …095 post-separation; however, he ceased making payments when he commenced to be assessed to pay child support. Consequently the loan he had assumed responsibility to pay both before and after separation grew from a liability of $277,409 at separation to $280,000 at the date of trial. By May 2010 the husband had reduced the balance to $243,340, however, he ceased making any further contribution after that date.
·The wife ceased making any payments on the ANZ loan …694 in November 2011.
·Included in the list of expenditure for which the additional draw down funds were applied, in whole or in part, are the following:
(i)repayment of loan to the wife’s father $59,970
(ii)payment of school fees and associated expenses (not sourced from the proceeds of the Queensland property or the wife’s inheritance) $53,362.
(iii)Purchase of the wife’s motor vehicle which is included on the balance sheet as an asset $23,000
(iv)C’s overseas trip $6,230
(v)Accounting fees $1,650
(vi)Payments made to Westpac loan …704 of $86,533. The source of the funds to meet this payment came predominantly from the rental of 47 S Street.
Those matters total $230,745.
·From May 2010 the husband made no contribution from his income to the liabilities of the parties. He did pay child support which was assessed against him. From May 2010 until the date of the trial the husband contributed $23,000 to child support payments.
As set out earlier in these reasons the wife received an inheritance of $184,316 in 2012. She applied those funds in payment of school fees for the children, the payment of taxation repayment of a debt and also reducing the debt on her car. All those aspects of expenditure have been taken into account by me when assessing the parties’ contributions. The wife has paid legal fees of $67,005 from her inheritance. At the time of the hearing the wife had a remaining balance from her inheritance of $5,287.
Each of the parties has incurred and paid legal costs as follows: The wife has incurred and paid $130,596 in legal costs. The husband has incurred legal costs of about $200,000. It is unclear from exhibit H1 how much of the fees have been paid.
The wife had occupation of the property at 49 S Street with the children post separation. The husband has been living with his parents since the separation and making a contribution of $300 per week to his accommodation albeit that the contribution is not made directly to his parents.
This is a matter where there is a relatively small net asset pool. The parties have agreed as to how the assets should be divided in specie between them and so the disputed matter is really the quantum of any cash adjustment to be made.
By the orders which the parties entered into during the trial which assigned to each of them one of the S Street properties and the mortgage debt secured on that property. They will each have incurred significant debt which they will need to service arising from that agreement.

Wife’s submissions on section 75(2)

The wife submitted that there should be an adjustment in her favour of 12 per cent. It was submitted that should be increased to 18 per cent if the Court did not add-back the $54,600 held by the husband’s brother, being the funds accumulated from the payment of $300 per week as board paid for the benefit of the husband’s parents. The wife submitted that the main reasons which would warrant such adjustment are:
·The wife’s care of the children aged 16 and almost 12. The children live with the wife and J spends 4 days per fortnight in the care of the husband.
·The husband has a significant resource in living with his parents. He is not required to contribute anything for that care. He says the reason e has paid the money to his brother is because his parents refuse to accept any payment from him.
·This is a case where there is a small net asset pool.

Conclusion on section 75(2)

Having considered all of those matters I conclude there should be an adjustment to the conclusion reached following assessment of contribution in favour of the wife. That adjustment should be modest and I determine the sum of $43,889 should be the amount of the adjustment.

Overall division of assets

The above determination will see the wife receive $463,911 in net assets and superannuation and the husband receive $236,125. That represents 66 per cent of the total net pool to be received by the wife.

Just and equitable

In the circumstances of this case I determine that result to be just and equitable.

Orders which should be made

I propose orders which will give effect to the following division.
The wife will receive:

Assets	($)
· 49 S Street, Suburb T	837,500
· Superannuation	122,885
· Payment from the husband pursuant to determination	120,000
Total Assets	$1,080,385

Liabilities
· Westpac Loans …095, …704 and …989	611,474
· Loan from Ms V to pay Structco Invoice	5,000
Total Liability	616,474
Net Assets (including superannuation)	$463,911

The husband will receive:

Assets	($)
· 47 S Street, Suburb T	700,000
· BMW motor vehicle	28,000
· Proceeds of sale of motor bike	4,000
· Superannuation	104,125
· Total assets and super	$836,125
Total Assets (including superannuation)	$
Liabilities
· ANZ Loan …694	480,000
· Payment to the wife pursuant to determination	120,000
Total Liabilities	$600,000
Net Assets (including superannuation)	$236,125

The orders will require that the husband pay the wife the sum of $120,000. He should be provided with time to make the payment as he will have to arrange to borrow the funds to do so. The orders will be made shortly before Christmas and the husband may experience difficulty being able to obtain answers to finance applications over what is traditionally a holiday time in this country. I propose to allow him four months in which to make the payment.
The husband should be restrained from dealing with the property which has been transferred to him, namely 47 S Street, Suburb T pending the payment made by him to the wife. Thus the property should stand as security for the payment.
There should be provision for sale of the property if the payment is not made.

I certify that the preceding three hundred and fourteen (314) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Le Poer Trench.

Associate:

Date: 14 December 2012

[2012] FamCA 1146

Key Legal Topics

Areas of Law

Family Law

Property Law

Legal Concepts

Consent

Costs

Damages

Remedies

Statutory Construction