Alston & Alston
[2021] FCCA 800
•25 May 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
Alston & Alston [2021] FCCA 800
File number(s): SYC 1504 of 2018 Judgment of: JUDGE MORLEY Date of judgment: 25 May 2021 Catchwords: FAMILY LAW – Property – assessment of contributions – where equal contributions made over a long period of time – one-pool approach – where assertions of wastage are made – where wife seeks the immediate sale of former matrimonial home – where husband seeks to continue residing in the home until he becomes incapacitated by virtue of accident, illness, aging, dies or agrees to the sale of the home – no order as to costs Legislation: Evidence Act 1995 (Cth) ss 50, 131.
Family Law Act 1975 (Cth) ss 79, 75, 43, 81, 117.
Family Law Rules 2004 (Cth) rr 19.04.
Federal Circuit Court Rules 2001 (Cth) rr 21.02.
Cases cited: Robb & Robb (1995) FLC 92-555;
Precision Plastics Pty Limited v Demir (1975) 132 CLR 362;
In the Marriage of Harris (1991) 104 FLR 458;
Pierce & Pierce (1999) FLC 92-844;
Hickey & Hickey & Attorney-General for the Commonwealth of Australia [2003] FamCA 395;
AJO & GRO (2005) 191 FLR 317;
Lovine & Connor (2012) FLC 93-515;
Dickons & Dickons [2012] FamCAFC 154;
Stanford & Stanford (2012) 247 CLR 108;
Petruski & Balewa (2013) 49 Fam LR 116;
Ashby & Slipper (2014) 219 FCR 322;
Fields & Smith (2015) FLC 93-638;
Talbot & Talbot (2015) FLC 93-660;
Vass & Vass (2015) 53 Fam LR 373;
Masoud & Masoud (2016) FLC 93-689;
Grier & Malphas (2016) 55 Fam LR 107;
Shan & Prasad [2018] FamCAFC 12;
Fontana & Fontana [2018] FamCAFC 63;
Trevi & Trevi (2018) FLC 93-858;
Jabour & Jabour [2019] FamCAFC 78.
Number of paragraphs: 137 Date of last submission/s: 24 February 2020 Date of hearing: 8-9 October 2019 Place: Sydney Solicitor for the Applicant: Watkins Tapsell Solicitors Solicitor for the Respondent: The Respondent Appeared in Person ORDERS
SYC 1504 of 2018 BETWEEN: MS ALSTON
Applicant
AND: MR ALSTON
Respondent
ORDER MADE BY:
JUDGE MORLEY
DATE OF ORDER:
28 MAY 2021
THE COURT ORDERS THAT:
1.That pursuant to section 79 of the Family Law Act 1975 (Cth):
(a)That the parties shall forthwith sign all documents and instruments and do all things necessary to list for sale the property at B Street, Suburb C in the State of New South Wales being the whole of the land in certificate of Title folio identifier ... ("the property") at a listing price agreed upon between them with a real estate agent agreed upon between them and shall proceed to a sale of the property at a sale price agreed upon between them and following such sale the proceeds of sale shall be applied as follows:-
(i)In adjustment of rates on settlement;
(ii)In payment of agent’s commission (if any) on sale;
(iii)In payment of legal and all other proper costs of sale;
(iv)In division of the balance of the proceeds of sale between the parties in such manner that each has received an equal share of the matrimonial asset pool on the basis that prior to such division of the balance of the proceeds of sale the husband has $103,497 and the wife has $89,937.
(b)That in the event that the property does not sell by private sale within three months from the date of this order then the parties shall sign all documents and instruments and do all things necessary to list the property for sale by public auction with an auction agent agreed upon between them at a reserve price agreed upon between them and shall proceed to a sale at a sale price agreed upon between them and the parties shall be equally responsible for all costs and expenses of the auction payable prior to the auction sale and following such sale the proceeds of sale be applied as provided in order 1(a) hereof.
(c)That in the event that order 1(b) operates and the property does not sell by public auction in accordance with order 1(b) then the property shall be resubmitted for sale by private treaty in accordance with the provisions of order 1(a) and the property shall be resubmitted for sale by public auction at six (6) monthly intervals from the last public auction and be resubmitted for sale by private treaty between such auctions, until the property shall be sold and upon such sale either by public auction or private treaty the proceeds of sale shall be applied as provided in order 1(a).
(d)That in the event that the parties are unable to reach agreement in relation to an auction agent or a real estate agent then the parties shall and do hereby appoint the President for the time being of the Real Estate Institute of New South Wales or his or her nominee to determine such disputed matter or matters and the parties shall thereafter act in accordance with that determination and the parties shall be equally responsible for the costs and expenses of the President or his nominee in making such determination.
(e)That in the event that the parties are unable to reach agreement in relation to a listing price, a reserve price or a sale price whether for a sale by public auction or by private treaty then the parties shall and do hereby appoint the President for the time being of the Australian Property Institute or his or her nominee to determine such disputed matter or matters and the parties shall thereafter act in accordance with that determination and the parties shall be equally responsible for the costs and expenses of the President or his nominee in making such determination.
(f)That the wife is the sole owner in law and in equity as between herself and the husband of the following items of personal property that were contained in the property at the time of separation:-
(i)Double bed (wife’s mum and dad’s);
(ii)Bedroom drawers (wife’s mum and dad’s) and bedside table;
(iii)Piano (wife’s mum and dad’s);
(iv)2 seater green lounge and floor lamp (wife’s mum and dad’s);
(v)Rug from the front lounge room;
(vi)Television from the front lounge room;
(vii)Toy box and contents from the front lounge room (wife’s mum and dad's)
(viii)Cane lounge suite (2 seater and 2 single seats);
(ix)Buffet unit;
(x)White cupboard - kids room (Ms D & Mr E's);
(xi)White cupboard - down under room (Ms D and Mr E's);
(xii)Washing machine - Bosch;
(xiii)Dryer;
(xiv)Exercise bike and rowing machine;
(xv)1/2 size dishwasher from Aldi;
(xvi)Automatic frying pan;
(xvii)Steel Renaware pots;
(xviii)Vacuum cleaner – Miele;
(xix)Set of Readers Digest Hard-Back Books;
(xx)1/2 of all crockery, cutlery and glassware;
(xxi)Serving dishes, bowls and vases;
(xxii)All tablecloths and serviettes;
(xxiii)Original and/or copy of photos from computer and framed photos on the piano;
(xxiv)Original and/or copy of professional photos of Ms D and Mr F circa 1983;
(xxv)Original and/or copy of family videos and recordings of Dad's singing from VCR tapes or computer;
(xxvi)1/2 of the towels and linen;
(xxvii)Framed photos of her mum and dad;
(xxviii)1/2 of the children's storybooks;
(xxix)Foldable picnic table and stools;
(xxx)Small round glass outdoor table and all grey chairs;
(xxxi)Wooden framed wall clock from the dining room;
(xxxii)One of the retractable outdoor hoses;
(xxxiii)Downstairs refrigerator (wife’s mum and dad's); and
(xxxiv)One of the three white storage cupboards from downstairs.
(g)That in the event that any of the items of personal property referred to in order 1(f) are in the possession of the husband at the date of this order the wife shall arrange for collection of those items from the husband at the property at the wife’s expense, such collection to occur on a day and at a time agreed between the parties and within 21 days of the date of this order.
(h)That the husband is the sole owner in law and in equity as between himself and the wife of all personal property and financial assets currently in his power, possession or control other than as specifically dealt with elsewhere in this order.
(i)That the wife is the sole owner in law and in equity as between herself and the husband of all personal property and financial assets currently in her power, possession or control other than as specifically dealt with elsewhere in this order.
2.That in the event that either party refuses or neglects to comply with any part of this order in relation to the execution of any deed, instrument or document the court appoints and authorises the Registrars of the Court to execute such deed, instrument or document in the name of the party who so refuses or neglects and further appoints those Registrars to do all acts and things necessary to give validity and operation to the deed, instrument or document.
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment under the pseudonym Alston & Alston is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE MORLEY
INTRODUCTION
These are property settlement proceedings between the Applicant Wife, Ms Alston (“the wife”), and the Respondent Husband, Mr Alston (“the husband”). The parties commenced cohabitation in 1980, married in 1981, and separated at some time between 15 October 2016 and 7 March 2017.
The husband has three sons from a previous marriage, Mr P, Mr Q and Mr R, all of whom were adults at the time of the hearing.
The parties have two children of their marriage, Ms D, born in 1981, and Mr F, born in 1982. Both Ms D and Mr F were adults at the time of the hearing.
The wife was represented by her solicitor advocate, Mr Roche, and the husband was self-represented throughout the proceedings, including at the hearing.
The hearing took place on 8 and 9 October 2019, however, by the end of the second day, there was insufficient time to complete the evidence by way of a consideration of a significant volume of documents proposed to be tendered by the husband in his case. Orders were made for the husband to provide a Tender Bundle to the solicitors for the wife and for the wife’s solicitors to indicate any objections to the tenders. Those objections were set out by the solicitors for the wife in their written submissions.
The Tender Bundle submitted by the husband consisted of 83 separate documents. Objection was made to 30 of those documents, with the documents contained in the Tender Bundle not specifically referred to in the objections but being in the nature of documents labelled “without prejudice” or otherwise containing offers of settlement which were also objected to, though not specified. I will deal with those objections below.
At the start of the hearing, the husband indicated his objections to parts of the wife’s trial affidavit, and those objections were dealt with before the oral evidence.
The wife gave oral evidence, being examination-in-chief, as to formal matters of name, address, occupation and the confirmation of her trial affidavit. She was then cross-examined by the husband throughout both days of the hearing. At the conclusion of the cross-examination, there was no re-examination of the wife.
On opening of the husband’s case, Mr Roche, as solicitor advocate for the wife, advised that there was to be no cross-examination of the husband (assuming that his trial affidavit would be accepted by the Court).
Final written submissions were received on 17 September 2019, and an order was made on 24 February 2020 reserving judgment.
MATERIAL RELIED UPON
The wife relied upon the following materials:
(1)Case Outline document prepared by her solicitor advocate, Mr Roche;
(2)Initiating Application, filed 9 March 2018;
(3)Affidavit of the wife, sworn and filed 6 September 2019;
(4)Financial statement of the wife, sworn and filed 6 September 2015;
(5)Final submissions for the wife, filed 13 November 2019;
(6)Wife’s Reply to the Respondent husband’s submissions, filed 17 December 2019;
(7)Exhibit A1 – summary of the wife’s entitlements in relation to her membership of Super Fund G as at 7 October 2019;
(8)Exhibit A2 – letter dated 8 October 2019 on the letterhead of Watkins Tapsell Solicitors for the wife, being a Cost Notice pursuant to rule 19.04 of the Family Law Rules 2004 (Cth) (not applicable in the Federal Circuit Court of Australia); and
(9)The wife’s Minute of Orders sought at Final Hearing.
The husband relied upon the following material:
(1)Case Outline document, filed 1 October 2019;
(2)Amended Response, filed 14 June 2019;
(3)Affidavit of the husband, affirmed and filed 14 June 2019 (including brown booklet of annexures 1 to 29 inclusive);
(4)Financial statement of the husband, affirmed 26 September 2019 and filed 1 October 2019;
(5)Written submissions of the husband, filed 9 December 2019.
The husband also relied upon documents RE1 to RE47 in his Tender Bundle, being prints of emails, and on documents RD1 to RD36 in his Tender Bundle, being various documents. As indicated earlier, the wife made objection to certain of those documents.
I deal with those objections as follows:
(1)all photographs in the husband’s Tender Bundle (RD29 and RD32). are rejected on the basis of no relevance;
(2)documents relating to a dispute between the parties and an immediate neighbour, being a dispute between the husband and immediate neighbour (RD1 to RD5 inclusive and RD9). I reject the tender of those documents on the basis of lack of relevance;
(3)documents included by the husband in his Tender Bundle and asserted by the wife to have no relevance to the proceedings (RD10, RD13, RD16 to RD18 inclusive, RD32 to RD35 inclusive). I find that document RD16, being an email of 4 June 2018 from the husband to the wife’s solicitors, is relevant and admissible and the balance of the said documents are rejected as not relevant;
(4)The wife objects to certain documents being admitted into evidence on tender on the basis that “there is no evidence before the Court as to how, when or by whom the documents were created, and they do not form part of any sworn affidavit material and lack sufficient foundation for inclusion in evidence” (RD14, RD20 to RD23 inclusive, RD26, RD29 to RD30 inclusive). I find that RD14, RD20 to RD23 inclusive, RD26, RD29 and RD30 all purport to be summaries of various nature, presumably proposed to be summaries admissible pursuant to section 50 of the Evidence Act 1995 (Cth) but which, except for RD30, do not properly identify the source documents and were not served on the wife so as to give her the opportunity, prior to the hearing, to examine the documents pursuant to subsection (2) and, further, were not available to the wife prior to the hearing so that a forensic decision could be made as to whether or not the husband should be cross-examined in relation to those documents. RD29 consists of certain photographs already disallowed in (a) above. RD20 consists of two stock option certificates not relevant in these proceedings. In relation to RD30, the husband produced a subsequent version of the summary represented by that document and tendered same to the Court on 24 February 2020, at which time Mr Roche indicated on behalf of the wife that no objection was taken;
(5)In relation to various documents contained in the husband’s Tender Bundle by way of printouts of emails, the wife objects to the admission into evidence of any document in that Tender Bundle “labelled ‘without prejudice’ or otherwise containing offers of settlement that are inadmissible, including but not limited to the following emails … RE23, RE32, RE33, RE34, RE40, RE44”. The documents RE23 and RE32 to RE34 inclusive are rejected on the basis that they relate to attempts to negotiate a settlement of the dispute between the parties and such evidence is not to be adduced, pursuant to section 131 of the Evidence Act 1995 (Cth), and none of the exceptions in subsection (2) apply. Document RE40 does not contain any attempt to negotiate a settlement but rather, contains a reference to a separate proposed settlement of the matter without giving any detail. It deals with matters relating to disclosure in line with each party’s obligation to make full and frank financial disclosure.
(6)In relation to the balance of the documents contained in the husband’s Tender Bundle as “RE” documents, objected to by the wife in paragraph 13 of her written submissions without being detailed but referred to as “any and all documents within the husband’s proposed tender bundle labelled ‘without prejudice’ or otherwise containing offers of settlement”, I find that it is not up to the Court to search through the documents to identify any such other documents other than those specified by the wife, and, accordingly, all of the documents from RE1 to RE47 except for RE23, RE32 to RE34 inclusive and RE44 are admitted into evidence and marked as exhibit R1.
From the balance of the husband’s Tender Bundle, I admit documents marked RD6, 7, 8, 11, 12, 15, 16, 19, 24, 25, 27, 31 and 36 into evidence and mark them collectively as exhibit R2.
In considering the evidence contained in exhibits R1 and R2, I have identified certain documents as being originally relevant to the arguments advanced by the husband and in companion with some of the evidence adduced by him, but which will not be found to be relevant to the Court’s consideration of what order pursuant to section 79 of the Family Law Act 1975 (Cth) the Court considers appropriate, altering the interests of the parties should I find that it is just and equitable to make such an order.
The document provided to the Court by the husband on 24 February 2020, being a summary of bank statements relating to a summary of 11 financial institution accounts of the parties from 10 August 1999 to 7 September 2019, a summary pursuant to section 50 of the Evidence Act 1995 prepared by the husband, was not objected to on behalf of the wife and is admitted into evidence as exhibit R3.
The husband filed a Notice to Admit Facts on 4 July 2019, and I found at the commencement of the hearing on 8 October 2019 that the purported “facts” referred to in that document related to matters covered by legal professional privilege of the wife that was intact and the therefor said notice to admit facts was not relevant.
The husband also filed a Notice to Admit Facts on 7 July 2019, seeking that the wife admit certain asserted facts relating to a matter on 5 December 2015, however, I ruled on the first day of the hearing that the matters addressed by the asserted facts were not relevant in any way whatsoever in the proceedings.
THE COMPETING PROPOSALS
The wife proposed final orders pursuant to section 79 of the Act, summarised as follows:
(1)that the property at B Street, Suburb C, NSW (follow identifier ...) (“the B Street, Suburb C property”) be sold at auction and the net proceeds of sale be divided equally between the parties;
(2)that until the sale of the B Street, Suburb C property, the husband be solely responsible, as between the parties, for all expenses of the B Street, Suburb C property and he indemnify the wife in respect of same;
(3)that the wife be deemed the sole owner of personal property specified with particularity in 5.1 to 5.34 of her Minute of Order (exhibit A3);
(4)that otherwise, each party retain any property in his or her respective possession or control, including superannuation entitlements;
(5)that an order be made for the submission of a Minute of Order, supporting Affidavit and written submissions in relation to the husband paying the wife’s costs of the proceedings.
The orders proposed by the husband are set out on pages A174 to A178 of the husband’s written submissions. They are, in summary form:
(1)an overall division between the parties of the matrimonial asset pool, being 30 per cent to the wife and 70 per cent to the husband;
(2)that the husband continue to reside in the B Street, Suburb C property until he becomes incapacitated by virtue of accident, illness, aging, dies or agrees otherwise with the wife, upon the happening of any such event that the house be sold and the proceeds of sale divided as to 20 per cent thereof to the wife and 80 per cent to the husband;
(3)that the wife may reside “in the eastern end of the home, subject to paying half the outgoings and certain restrictions on behaviour”;
(4)that the personal property contained in the matrimonial home sought by the wife in her minute of order become her sole property as between the parties (items 5.1 to 5.34 inclusive) “become her property save the few exceptions on the list following” – no list could be found in any place;
(5)vehicles, vessels, household chattels [necessarily with the exception of the items 5.1 to 5.34 in the wife’s minute of order], tools and personal effects be retained by the party holding them at the time the Amended Response was filed on 14 June 2019;
(6)the wife retain the whole of her superannuation entitlements with Super Fund G;
(7)the wife transfer all T shares held by her to the husband within seven days of the orders;
(8)the wife retain all moneys in her Westpac bank accounts and the husband retain all moneys in his Westpac bank account;
(9)the Wife transfer from her Super Fund H account 77459001 to the husband’s Super Fund H account ...36 such sum as is required to raise the credit balance in the husband’s said Super Fund H account to a sum equal to 70 per cent of the sum of the credit balances of each of those accounts as at 15 October 2016 and thereafter the husband retain his said Super Fund H account as his sole property and the wife retain her said Super Fund H account as her sole property.
THE PROCEEDINGS
The proceedings were commenced on 9 March 2018 when the wife filed her Initiating Application, to which the husband responded on 6 April 2018. On 8 May 2018, the husband filed an Application in a Case seeking certain interim orders relating to disclosure and the preservation of assets, including an order that “the applicant do all things and sign all documents in pursuit of restoring amenities and water views to the property at B Street, Suburb C, NSW”.
The matter came before Judge Henderson (as her Honour then was) for first mention on 14 May 2018, also the return date of the husband’s Application in a Case. Orders were made by her Honour in relation to disclosure and for a Conciliation Conference to occur on 13 August 2018. The orders sought by the husband in relation to the restoration of “amenities and water views” at the B Street, Suburb C property were not the subject of any orders made and for reasons that will emerge in these reasons. A Conciliation Conference was held by Registrar Bastiani on 13 August 2018, and the matter was not settled.
The matter came before her Honour on 6 September 2018, at which time it was set down for a Callover to allocate hearing dates on 11 March 2019, later altered by Chambers order to 3 May 2019. On 3 May 2019, the matter came before me on Callover, and it was listed for Final Hearing on 8 and 9 October 2019.
The hearing proceeded on 8 and 9 October 2019, and orders and directions were made as outlined above in relation to the husband’s Tender Bundle and written submissions, and the matter was listed for mention on 18 December 2019, on which date the matter was further listed for mention and directions on 24 February 2020 with a notation that the purpose of that listing was to deal with an oral application by the husband to reopen his case to tender further evidence and, if leave was granted to reopen, to deal with the tender of further evidence and to deal with any objections made by the wife.
When the matter was mentioned on 24 February 2020, the Court indicated that the wife’s objections to documents in the husband’s Tender Bundle would be dealt with in the reasons, the husband tendered the further bank account transaction summary document, to which no objection was made by the wife, and judgment was reserved.
THE EVIDENCE
At the start of the hearing, objections were made by the husband to specific parts of the wife’s trial affidavit, and those objections were dealt with.
No objection was taken by the wife to any part of the husband’s trial affidavit. The husband was not cross-examined and “…as a general proposition, evidence which is not inherently incredible and which is unchallenged ought to be accepted”: Precision Plastics Pty Limited v Demir (1975) 132 CLR 362, Gibbs J (with whom Stephen J agreed). The evidence may, of course, be rejected if it is contradicted by facts otherwise established by the evidence or the particular circumstances point to its rejection”: Ashby & Slipper (2014) 219 FCR 322 at [77].
At the time of hearing, the husband was 76 years of age and the wife was 65 years of age. They commenced cohabitation in 1980 and married in 1981. In her evidence, the wife asserts that the parties separated on 3 January 2017, and in his evidence, the husband asserts that they separated on 7 March 2017 when the wife left the former matrimonial home. However, a balance sheet was provided to the Court by the parties at the hearing, having been filed with the Court on 14 October 2019 by the wife’s solicitors, and both items 14 and 15 therein refer to “agreed separation on 15 October 2016”. For reasons that will become apparent herein, no essential element for the Court’s consideration turns on the difference between 15 October 2016 and 7 March 2017.
The parties have two daughters of their marriage both of whom were in their late 30s at the time of the hearing. The husband has three older adult sons from his first marriage. At certain times during the parties’ cohabitation, all or some of the sons were members of the parties’ household. The precise times of them residing with the parties is not revealed in the evidence. It is referred to by the husband in his written submissions, but I disregard those references as the written submissions are not evidence. On the whole of the evidence, it is safe to say that the husband’s three sons resided with the parties as members of their household for periods of time sufficiently significant to be a basis for a consideration by the Court of the wife’s care of the children, which the husband concedes was of high quality, when considering whether there should be any adjustment between the parties pursuant to section 75(2)(o) of the Act (if it is found to be just and equitable to proceed with an order under section 79 of the Act): Robb & Robb (1995) FLC 92-555.
The husband, a professional, spent his career involved in the technology industry, from some time before the parties’ relationship until he retired from work. At the commencement of cohabitation, the husband was an employee of J Pty Ltd and shortly thereafter joined with two other persons in conducting a business through a corporation, K Pty Ltd, which he left in 1981. The husband then began setting up a business through a corporate vehicle, L Pty Ltd, of which the husband and the wife were the directors and shareholders. The corporation was registered in 1982 and deregistered in 2016. It is the husband’s evidence that he was the principal concerned with the conduct of the business operated by L Pty Ltd from its inception in 1982 until he retired in 2009, though continuing to conduct some “wind-down” business through L Pty Ltd until its deregistration in 2016.
The wife gives evidence that she was involved in the day-to-day running of the business conducted by L Pty Ltd from its inception until the husband’s retirement in 2009. She says that she engaged with the business initially by answering phones and conducting clerical work at home, but that her work later included attending meetings with customers, installing hardware and software and conducting maintenance calls.
In about 2008, the wife commenced working a 15-hour week at Employer M at Suburb N, which later became the Employer O at Suburb N, where the wife was still engaged in part-time work at the time of the hearing.
In paragraph 36 of his affidavit, the husband asserts that once he had set up the business conducted by L Pty Ltd, “over the next 25 years or so, I generally worked 12 to 14 hours a day seven days per week towards the betterment of our family.”
The husband says that throughout the period of the parties’ cohabitation, he also serviced and maintained the motor vehicles, repaired and maintained domestic appliances and entertainment devices and conducted renovation and landscaping works at the B Street, Suburb C property. He concedes that he was assisted in the landscaping work and the renovation work by the wife, though that her involvement was significantly less than his.
I find that the sole source of income for the family unit throughout cohabitation was the husband’s initial employment and then the income generated from L Pty Ltd. I find that the principal contribution to the income generation by L Pty Ltd was the work undertaken by the husband, applying his knowledge and skills, and that the wife assisted with the business conducted by L Pty Ltd so as to also constitute a contribution by her toward the income generated by the company to the benefit of the family unit.
The husband, in his evidence, sought to minimise the value of the contributions made by the wife to the business conducted by L Pty Ltd, saying that the wife’s input was a “limited and low-value contribution” and that the wife “refused to work on tennis days, Tuesdays and Thursdays, of most weeks”. The husband sets out in paragraph 11 of his affidavit at subparagraphs (vi) to (ix), the work he asserts the wife conducted in the business and the limits thereon. The husband was not cross-examined on that evidence, though there is some limited conflict between the evidence of the wife and the evidence of the husband on this aspect of the wife’s contributions to the business. I find that I do not need to resolve those differences and it can be accepted that the wife made a contribution to the business conducted by L Pty Ltd over the years, but to a degree significantly less than that of the husband and that the principal income-generating activity was conducted by the husband.
At the start of the parties’ cohabitation, the wife had no assets of any significance, and the husband had a sum of $40,000 he had received from his previous marriage settlement. In 1985, the parties purchased the B Street, Suburb C property for $85,000, the property being put in the sole name of the wife as registered proprietor. The husband contributed the whole of the $40,000 he had received from his previous marriage settlement, and the balance of purchase price and costs was obtained by the parties through a loan from a financial institution (unspecified in the evidence) secured by way of a first registered mortgage on the B Street, Suburb C property.
The loan account secured on the B Street, Suburb C property was paid out by the parties in 1998. Whether the loan was in the wife’s sole name in consequence of her being the sole registered proprietor or the joint names of the parties is unclear, though, in all probability, it was in the parties’ joint names, given the income-generating arrangements.
The wife was the primary homemaker throughout cohabitation. The husband admits in his evidence that the wife “generally cooked, laundered and kept house”. The wife was also the primary carer on a day-to-day basis for the parties’ children, Ms D and Mr F, and also for the husband’s sons, Mr P, Mr Q and Mr R, when they resided with the parties. The husband gives evidence that his three sons resided with the parties “during access periods only” from 1980 to 1985, though what is meant by “access periods” is not defined, and that from 1985 “the sons lived with us until, at various times under various circumstances, leaving home. The mother of the younger sons had fortnightly access, which was generally exercised. Eventually, the younger two children returned to their mother’s care”.
In 1997, the husband suggested to the wife that the wife’s elderly parents move in with them, and at the invitation of both parties, that arrangement commenced. The wife’s parents gave the wife $26,000 in either 1999 or 2000 to assist with renovations of the B Street, Suburb C property and to accommodate the wife’s parents living there. The wife’s father died in 2001, and her mother remained living at the B Street, Suburb C property with the parties until Christmas 2001.
In 1991, the husband received a legacy of $2000 from the estate of his late mother and those funds were applied to the purchase of an air-conditioner for the B Street, Suburb C property.
In 2008, the husband was involved in proceedings in the Supreme Court of New South Wales relating to certain stock options that had been assigned to him by a customer of L Pty Ltd. The proceedings were settled on the basis that the husband receive a sum of $280,000, from which he received a net sum of $265,200 after payment of his legal costs. Whether the moneys were properly payable to the husband or payable to L Pty Ltd is not clear on the evidence, however, I will assume that the moneys were payable to the husband as, though they were initially paid into the account of the corporation, the whole of the moneys received were paid out into the private accounts of the parties. There is no evidence that the same was treated as income, in the sense of being a dividend to the parties as shareholders from the company and, therefore, subject to taxation considerations, and I must assume that the parties acted in a lawful manner and money was damages received by the husband and not subject to taxation.
The sum of $265,200 was paid into the business account of L Pty Ltd initially, and then in 2009 the parties each set up an Super Fund H account. The moneys received were paid out of the business account and divided “equally” between the husband’s existing Westpac bank account and the wife’s existing Westpac bank account. The husband asserts that the initial deposits were each in the sum of $134,592. The husband passed this sum into his Super Fund H account. The wife transferred a sum of $182,000 from her Westpac bank account #...97 to her Super Fund H account in 2009. The sum of $182,000 and $134,592 is, of course, well in excess of the sum received as damages of $265,200.
The wife was cross-examined about the amount deposited to her Super Fund H account and gave evidence that it was:
…composed of $26,000 from my parents, $132,500 from half of the stock options damages and the rest being money from other sources already in my Westpac account from which all of these moneys were transferred to my Super Fund H account.
The wife gives evidence that she applied moneys from both her and the husband’s Super Fund H account toward various expenses over the years, including paying for their daughters’ weddings which the husband confirms, and in paying bills, accounts and outgoings for the family when there were insufficient funds elsewhere for these purposes. It is the husband’s evidence that he has never drawn down against his or the wife’s Super Fund H accounts, but that the wife was authorised to operate those accounts to pay for the daughters’ weddings and to apply the interest on the accounts toward living expenses. It seems, on the evidence, that there was a sum of about $101,000 in each account at the time of the parties’ separation.
In early 2017, after separation, but whilst the parties were still residing under the same roof, the husband purchased the Motor Vehicle 1, still retained by him, from moneys in his Super Fund H account for the sum of $9800. The vehicle is registered in his sole name. Sometime thereafter, the wife purchased a Motor Vehicle 2 for a purchase price not disclosed in the evidence from moneys in her Super Fund H account.
When the wife left the B Street, Suburb C property on 7 March 2017, there was a sum of about $88,000 in each of the accounts. At the time of hearing, the husband’s ING account had a credit balance of $86,608, and the wife’s Super Fund H account had a credit balance of $56,112. It is the wife’s evidence that she had applied moneys from her Super Fund H account following separation and following her vacating the B Street, Suburb C property toward her day-to-day living expenses.
Since 7 March 2017, the husband has continued to reside in the B Street, Suburb C property, that property being throughout that time unencumbered by any mortgage as security for repayment of any loan account. Since 7 March 2017, the wife has arranged her own accommodation with their daughter Ms D in Ms D’s family home shared with her husband and their children. In relation thereto, the wife deposes in her financial statement that she does not pay any rent, board or other accommodation cost to Ms D and her husband but is accommodated there pursuant to an arrangement whereby she purchases food and other consumables for the household.
The husband included a considerable amount of evidence in his case in relation to efforts undertaken by him to restore the “amenities and water views” of the B Street, Suburb C property towards the waters of Suburb P. This involved the husband’s interaction with his neighbours in relation to the height of plants, the height of fencing and a shade sail erected on the neighbour’s property that blocked the view from the B Street, Suburb C property as well as the husband’s interaction with S Council. The husband presents argument that the loss of “amenities and water views” to the B Street, Suburb C property affects its value and that he was, in some manner, hampered or frustrated in his efforts by the wife. In paragraph 23 of his trial affidavit, he says:
To realise the value placed on the house would certainly require restoration of the outlook once enjoyed. Ms Alston actively frustrated my efforts to exert our lawful rights in terms of protecting valuable water views. This resulted, among other things, not following the encouragement of a director of the Department of Environment and Planning to refer certain matters to ICAC.
The husband does not present any evidence to establish his assertion that the wife frustrated his efforts or, indeed, any evidence to indicate that the wife hampered him in any way in his campaign to restore “amenities and water views”.
The parties agreed upon the value of the B Street, Suburb C property as $1,200,000 for the purpose of the trial. It is inherent in the matter that the B Street, Suburb C property will go to sale, on the wife’s case immediately, on the husband’s case once he vacates the property for one of his proposed reasons. There is no evidence whatsoever of the effect on the value of the property of any loss of “amenities and water views”.
I find that the whole of the considerable evidence presented by the husband, including the evidence of the wife on the topics during cross-examination by the husband, relating to the husband’s interaction with the neighbours, the husband’s interactions with the S Council and in relation to any loss of or restoration of “amenities and water views” of the B Street, Suburb C property, is not relevant in these proceedings and will form no part of my consideration of whether it is just and equitable to make orders pursuant to section 79(1) of the Act and, if it is so considered just and equitable to make orders, what orders should be made under section 79(1) of the Act.
At the time of hearing, the wife had an income of about $706 per week from $415 gross for 15 hours per week as a retail assistant at the Employer O, $30 a week from ironing, $240 a week from a part aged pension and $21 a week from dividends on her T shares and interest on her Super Fund H account.
The husband has an income of $474 a week, being $464 from an aged pension and $10 interest on his Super Fund H account.
The wife asserts expenses of $376 per week, those expenses not including any accommodation costs as such, and the husband asserts expenses of $400 a week, those expenses not including any accommodation costs.
The wife says that she is in good overall health, though she has been advised that she will eventually need an operation for a knee replacement “at some point”. The husband indicates that he has some form of “meningioma” – “a golf-ball-size tumour” within his skull, benign.
The husband seeks to remain in occupation of the B Street, Suburb C property as long as he can, within the limits of health. The wife wishes to retire from engaging in employment and intends to rent her own home.
MATRIMONIAL ASSET POOL
The parties agree on the following as the components of the matrimonial asset pool (there are no liabilities):
ASSETS Ownership
Description
Value 1 Wife Property at B Street, Suburb C, NSW 1,200,000 2 Wife Westpac Bank Choice Account No. ...60 1,189 3 Wife Westpac eSaver Account No. ...80 500 4 Wife Super Fund H Account ...01 56,112 5 Wife Motor Vehicle 2 7,500 6 Wife Household contents 1,000 7 Wife T Shares 6,360 8 Husband Westpac Account no. ...88 5,389 9 Husband Super Fund H Account No. ...36 86,608 10 Husband Motor Vehicle 1 6,500 11 Husband Boat 1,000 12 Husband Household contents 2,500 13 Husband Tools 1,500 Total
$ 1,376,158
| SUPERANNUATION | ||||
| Member | Name of Fund | Type of Interest | Value | |
| 10 | Wife | Super Fund G | Accumulation | 17,276 |
| Total | $17,276 | |||
| NETT TOTAL ASSETS (including Superannuation) | $1,393,434 | |||
Issues relating to the matrimonial asset pool
The balance sheet filed 4 October 2019 listed the value of the wife’s superannuation with Super Fund G at $17,424, but exhibit A1 indicates the value of the fund as at 7 October 2019 at $17,275.88, which I have rounded for the purpose of the proceedings to $17,276.
The husband asserts that moneys should be added back to the matrimonial asset pool, being moneys expended by the wife from the wife’s Super Fund H account and from the husband’s Super Fund H account since “agreed separation on 15 October 2019”.
The husband in his evidence asserts that at 15 October 2019, the credit balance of the wife’s Super Fund H account was $100,960 and that, the credit balance of the account at hearing being $56,112, the wife has expended $44,848, which, he asserts, should be added back to the matrimonial asset pool.
The husband further asserts that the difference between the balance of his Super Fund H account at separation on 15 October 2019 of $98,940 and the balance of that account as at 7 March 2017 when the wife vacated the B Street, Suburb C property of $84,107 should be added back to the matrimonial asset pool (after allowing for the $10,000 expended on the Motor Vehicle 1), being an asserted addback of $4,833.
It seems that the manner by which the husband asserts the addback should be achieved is in terms of the orders sought by him, whereby the parties are to calculate the total of the credit balances of the two accounts at 15 October 2019 of $199,900 and for the wife to pay into the husband’s Super Fund H account a sum sufficient to bring the credit balance of that account up from $86,608 to $139,930, being 70 per cent of $199,900. In proposing that calculation, the husband has not allowed for the $10,000 expended by him on the Motor Vehicle 1 or the amount expended by the wife on the Motor Vehicle 2. Both of those vehicles are included in the net matrimonial asset pool set out above.
I find on all of the evidence that moneys expended by the wife from the husband’s Super Fund H account prior to her vacating the B Street, Suburb C property on 7 March 2017 was expenditure in relation to either the accumulation of assets or living expenses for the husband and wife as co-occupants of the B Street, Suburb C property and for their daughters’ weddings. I find that the expenditure by the wife from her Super Fund H account from the time of the parties’ separation until the hearing, so as to retain a credit balance at hearing of $56,112, was for living expenses for the husband and wife while co-occupants of the B Street, Suburb C property, living expenses of the wife after vacating the B Street, Suburb C property and the accumulation of assets and in relation to their daughters’ weddings. Accordingly, I find that there is no addback to be made, that the appropriate amounts to be included in the net matrimonial asset pool from the moneys received by the husband in consequence of the Supreme Court “share options” proceedings is the agreed balance of each of their Super Fund H accounts, being $56,112 for the wife’s account and $86,608 for the husband’s account.
In making my determination in relation to the addbacks claimed by the husband, I have considered the principles to be derived from AJO & GRO (2005) 191 FLR 317; Talbot & Talbot (2015) FLC 93-660; Vass & Vass (2015) 53 Fam LR 373, particularly at paragraphs [138] and [139]; Masoud & Masoud (2016) FLC 93-689; Shan & Prasad [2018] FamCAFC 12; and, particularly, Trevi & Trevi (2018) FLC 93-858 at paragraphs [27] to [42] and [46] and [47].
THE LAW
The law relating to the alteration of property interests between two parties to a marriage is governed by section 79 of the Act.[1] Section 79(1) vests the Court with power to alter the interests of the parties in property,[2] and the power to make orders providing for the settlement or transfer of property, as determined by the Court.[3]
[1] Family Law Act 1975 (Cth) s 79.
[2] Family Law Act 1975 (Cth) s 79(1)(a).
[3] Family Law Act 1975 (Cth) s 79(1)(d).
However, the Court must not make an order under section 79 unless the Court is satisfied that, in all of the circumstances, it is just and equitable to do so.[4] The legislative process required by section 79 was considered by the High Court in Stanford & Stanford.[5]
[4] Family Law Act 1975 (Cth) s 79(2).
[5] Stanford & Stanford (2012) 247 CLR 108.
In that decision, the High Court held that section 79(2) requires that at the outset of the Court’s decision-making process the Court must consider whether or not, in all the circumstances, it is just and equitable to make an order under section 79(1) altering the interests of the parties to the marriage in property.
In considering the proposition posed by this first step, a Court should start by identifying items under the following categories:
(a)The existing legal and equitable interests of the parties in property, according to ordinary common law and equitable principles;
(b)The existing liabilities of the parties, according to ordinary common law and equitable principles and under legislation; and
(c)The rights of the parties, if any, according to ordinary common law and equitable principles and under legislation, in relation to any asserted resources of the parties that may, if it is considered just and equitable to proceed with the property settlement, be taken into account in the Court’s consideration of the matters referred to in section 75(2) of the Act, to which section 79(4)(e) directs the Court’s attention.[6]
[6] Stanford & Stanford (2012) 247 CLR 108; see, especially, [37].
That the interests as described above are ‘existing’ is of importance, as the Court noted, because the text of the section gives reference to ‘altering’ the interests.[7]
[7] Stanford & Stanford (2012) 247 CLR 108, [37].
I further note the comments of the High Court in Stanford at paragraph 42, which I reproduce in full here:
In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).[8]
[8] Stanford & Stanford (2012) 247 CLR 108, [42].
I will examine the matrimonial asset pool and the existing interests of the parties, before determining whether it is just and equitable to make a property adjustment order.
If the Court determines that it is just and equitable to make an order under section 79, the Court must then consider what orders are appropriate to be made. In doing so, I will follow the four-step process set out in Hickey & Hickey & Attorney-General for the Commonwealth of Australia.[9]
[9] Hickey & Hickey & Attorney-General for the Commonwealth of Australia (‘Hickey’) [2003] FamCA 395, [39].
In Hickey, the Full Court of the Family Court set out a process of four inter-related steps that must be taken by a court when determining a property application:
(1)First, “the Court should make findings as to the identity and value of the property, liabilities, and financial resources of the parties at the date of the hearing”;[10]
(2)Second, “the Court should identify and assess the contributions of the parties within the meaning of section 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”; [11]
(3)Third, “the Court should identify and assess the relevant matters … (“the other factors”) including…the matters referred to in section 75(2) so far as they are relevant…”;[12]
(4)Fourth, “the Court should … resolve what order is just and equitable in all the circumstances of the case”.[13]
[10] Hickey [2003] FamCA 395, [39].
[11] Hickey [2003] FamCA 395, [39]. See also Family Law Act 1975 (Cth) s 79(4)(a)-(c)..
[12] Hickey [2003] FamCA 395, [39].
[13] Hickey [2003] FamCA 395, [39].
The Full Court pointed out in Hickey that pursuant to the wording of section 79, there can only be one property settlement order at any one time, and that the one property settlement order is final, subject only to anything that may be properly done pursuant to section 79A of the Act.[14]
[14] Hickey [2003] FamCA 395, [47].
The Full Court held in Fontana:[15]
… Indeed, the authorities are consistent in finding that assessing contributions is not an accounting exercise but a holistic one (Brandt & Brandt (1997) FLC 92-758; Norbis & Norbis (1986) 161 CLR 513).[16]
[15] Fontana & Fontana [2018] FamCAFC 63.
[16] Fontana & Fontana [2018] FamCAFC 63, [27].
The Court is required to consider the parties’ contributions made on and from the commencement of their relationship, during their relationship, and following separation.[17]
[17] See, eg, Jabour & Jabour [2019] FamCAFC 78.
The approach to determining the appropriate percentage of the net value of property in relation to the contributions of the parties, at step two of the four-step process, requires an assessment of contributions by, or on behalf of, each of the parties in a holistic manner, rather than attaching specific contributions to a specific item of property and making a determination upon that basis. To do the latter would be to disregard the whole of the contributions made during the whole of the relevant period of the relationship by or on behalf of each of the parties.
As the Full Court said in Dickons & Dickons[18] at paragraphs [14] to [16]:
[14] As is plain from earlier decisions of this Court, regard must be had to the use made of contributions of various types so as to compare the contributions made by each of the parties during the course of, and over the length of, their relationship (see, for example, In the Marriage of Pierce (1998) FLC 92-844) But that is an entirely different proposition to, as it were, causally linking contributions with their asserted financial “product” or “value”. The former recognises that the nature, form and extent of contributions made by each of the parties might differ; the latter suggests that the absence of a causal link counts as no contribution at all.
[15] The search for a causal link might be seen to come instinctively to the necessary inquiry and all the more so when regard is had to s 79(4)(a) which refers to financial contributions made “...directly or indirectly...” “...to the acquisition, conservation or improvement of any of the property ...” and goes on to also refer to the financial contribution made “...otherwise in relation to any of that last-mentioned property...” The terms of that sub-paragraph might, naturally enough, be seen to suggest a causal link between those contributions and the “financial product” which those contributions of that type are said to have produced. That same requirement might also be seen to suggest that relevant contributions of that type can be seen to be quantifiable – or, at least, conceptualised – in monetary terms, in contradistinction to contributions made pursuant to s 79(4)(c).
[16] While that apparent “causal connection” might be seen in s 79(4)(a) (and (b)), no such connection is apparent from the terms of s 79(4)(c); contributions of that latter type are not linked by the words of the sub-paragraph to the “...acquisition, conservation or improvement of any of the property...” or, indeed, to “property” at all. This is not a legislative oversight; the 1983 amendments to the Act which inserted the current s 79(4)(c) were specifically intended, relevantly, to remove any suggestion that there needed to be a causal link between contributions of that type and any particular asset or property. The Explanatory Memorandum to the Family Law Act Amendment Bill 1983 provides, at Clause 36, that a specific purpose of the re-casting of s 79(4) was, relevantly, to:
... revise sub-section 79(4) to remove the possibility of an interpretation of the sub-section requiring that there be a nexus between a spouse’s contribution and a specific item of property in section 79 proceedings ...[19]
[18] Dickons & Dickons [2012] FamCAFC 154.
[19] Dickons & Dickons [2012] FamCAFC 154, [14]-[16].
The Court is required to make a holistic value judgment in the exercise of a discretionary power of a very general kind.[20] The principle was expressed succinctly by the Full Court in the joint judgment of Bryant CJ and Ainslie-Wallace J in Fields & Smith[21] at paragraph 168:
...the task is to consider the contributions holistically over the whole period from the commencement of cohabitation to trial, and the analysis requires the Court to weight all of the contributions of all types prescribed by section 79(4) made by both parties across the entirety of the relationship until the time of Hearing, including the post-separation period.[22]
[20] In the Marriage of Harris (1991) 104 FLR 458, 464.
[21] Fields & Smith (2015) FLC 93-6387.
[22] Fields & Smith (2015) FLC 93-638, [168].
The Full Court has been repeatedly clear that the approach to property settlement under section 79 of the Act is not an accounting exercise. Here, I note the comments of the Full Court in Grier & Malphas[23] at paragraph 129, where Murphy and Kent JJ said:
As the Chief Justice points out, with those principles in mind, the trial judge adopted a broad-brush approach to the parties’ respective expenditure. Nowhere error is established by reason alone of that approach; authority eschews “overly pernickety analysis” and section 79 demands neither an audit nor an exercise in accounting. However, when significant sums of money are said by one party or the other to have been “wasted” or to amount to a unilateral “premature distribution of property” and the evidence is suggestive of either or both, an analysis of the relevant sums and their use is needed.[24]
[23] Grier & Malphas (2017) 55 Fam LR 107.
[24] Grier & Malphas (2017) 55 Fam LR 107, [129].
IS IT JUST AND EQUITABLE TO MAKE AN ORDER UNDER SECTION 79?
The parties’ marriage has broken down irretrievably. They separated on 15 October 2016 and remained living under the one roof at the B Street, Suburb C property until the wife vacated those premises on 7 March 2017.
The parties cohabited for just short of 37 years.
The principal asset in the matrimonial asset pool is the B Street, Suburb C property, of which the wife is the sole registered proprietor. Unless orders are made pursuant to section 79 of the Family Law Act 1975 (Cth), the parties will be left in the unjust and inequitable position of the wife having 92.5 per cent of the matrimonial asset pool if that includes the wife’s superannuation entitlements, and the husband as having 7.5 per cent thereof.
I find that it is just and equitable to make an order pursuant to section 79 of the Act, altering the interests of the parties in the property comprising the matrimonial asset pool.
In that regard, I also find that it is appropriate to deal with the available property and superannuation entitlements based on a one-pool approach. In that regard, I find that the available assets total $1,376,158, and the wife’s superannuation entitlement is valued at $17,276, being a matrimonial pool of $1,393,434.
SUBMISSIONS
Mr Roche on behalf of the wife submits that the wife’s application equates to “a near 50 per cent-50 per cent split” of the property pool, whilst the husband’s application equates to an 80 per cent to the husband and 20 per cent to the wife division of the property pool. He submits that on all of the evidence, and despite the husband’s initial contribution of $40,000 towards the $85,000 purchase price of the B Street, Suburb C property, and taking into account the $26,000 received by the wife from her parents in 1999 or 2000 and the $2000 received by the husband from his late mother’s estate in 1991, that “the contributions over this long relationship are equal and reflective of their partnership”.
Mr Roche further submits on behalf of the wife that “there is no basis for either party to receive a section 75(2) adjustment for future needs”.
Mr Roche makes submissions that the adjustment of property between the parties by a sale of the B Street, Suburb C property should happen upon the making of orders and should not be delayed pending the husband’s incapacitation or death, as proposed by him, and that the submissions made by the husband on a basis of “special skills” or “special contribution to the business” should be rejected in line with the decision of the Full Court of the Family Court of Australia in Fields & Smith (2015) FLC 93-638 at [42] and Petruski & Balewa (2013) 49 Fam LR 116 at [25], both referred to by Mr Roche in his submissions.
The husband’s submissions are a little more difficult to parse down to a simple summary. I will take just a few points as large parts of those submissions have been dealt with above in rejecting the “amenities and water views” segment of the husband’s case and the “addbacks” segment of the husband’s case.
The husband submits that “the wife did not offer oral evidence”, but that is his misconception of the trial process. The wife’s evidence-in-chief was contained in her trial affidavit, and she did not seek to add to her evidence-in-chief in the witness box prior to cross-examination. The husband also criticises the wife in paragraph 43 of his submissions for not filing an Amended Initiating Application, but once again he has misconceived the situation, his submission being a reference to the trial directions made on 3 May 2019, which included a direction that the wife “file and serve any amended initiating application” by a certain date. That order did not require the filing of an Amended Initiating Application, but merely set a deadline for the filing of any such document should the wife seek to amend her application. The wife did not.
Beginning at paragraph 61 of the husband’s written submissions, he makes submissions through to paragraph 87 in support of his proposed order that he be able to remain living in the B Street, Suburb C property until infirmity or death or by way of his agreement and that the property not be sold until that time, in the course of which he asserts in paragraph 66 that such order would allow him to remain in the home “as long as practical while making proper provision for [the wife’s] needs”. Such order proposed by the husband, being addressed to needs, ignores the task of the Court under section 79(4)(a) to (c) of the Act and what is known as step 2 of the four-step process (Hickey & Hickey), and is also not an outcome open to the Court under any of the “needs factors” in section 75(2) of the Act, to which the Court’s attention is directed by section 79(4)(e). Such an outcome would patently not make “proper provision for [the wife’s] needs”.
In support of his contention that he should be able to remain in the B Street, Suburb C property on his terms, the husband refers to section 43 of the Family Law Act 1975 (Cth) relating to the need to preserve and protect the institution of marriage as the union of two people to the exclusion of all others voluntarily entered into for life. That submission by the husband is misconceived, section 43 having no application in these proceedings.
The husband next submits that section 81 of the Act, relating to the Court’s duty to end the financial relations between the parties “as far as practicable”, opens the door for the Court to delay the sale of the matrimonial home so as to provide the wife the usable benefit of the value thereof, until some point in the future when the husband vacates the home. I again reject that submission, the husband’s submission going more to the “as far as I wish it to be delayed for my own purposes” as opposed to the real meaning of “as far as practicable” under section 81, which, I find, goes to any real and inherent difficulties in dealing with the alteration of property interests between the parties at the time of making orders. Here, there is no such difficulty other than the husband’s assertion that it would render him “homeless”, an assertion that, on the evidence of the value of the matrimonial asset pool and applying for this purpose only the wife’s application, I reject.
Next in his written submissions, the husband seeks to rely on the decisions of both the Full Court of the Family Court of Australia and the High Court of Australian in Stanford & Stanford (2012) FLC 93-495 (the Full Court decision being [2011] FamCAFC 208). The factual matrix in Stanford and the factual matrix in these proceedings are so different as to not require the Court detailing an analysis of why the Full Court and High Court decisions in Stanford do not assist the husband’s argument.
The husband makes copious and detailed submissions in relation to what he terms “loss of amenity … water views” and “the fence and related issues” and “the over-height building”, but I have already found that none of those issues are relevant in these proceedings, and much of the husband’s written submissions are not submissions, but an attempt to introduce evidence, not being evidence adduced in the hearing.
At paragraphs 145 and 146 of his written submissions, the husband points out that the authority Robb & Robb (1995) FLC 92-555 was not relied upon by the wife in submissions, but that, of course, does not prevent a trial judge applying authority, a trial judge not being confined to the submissions of the parties and issues raised by the parties in their submissions in the same way that Appellate Courts are so limited.
Next in submissions, the husband refers to certain parts of the transcript of his cross-examination of the wife, relating to her involvement in the business conducted by L Pty Ltd and, in particular, in relation to her involvement in certain meetings overseas with customers. I have considered the wife’s evidence in cross-examination in this regard in my findings in relation to the participation of each of the parties in the business.
Finally, the husband makes written submissions to the effect that, in relation to a division of the proceeds of sale of the matrimonial home, whenever occurring, the percentage of the purchase price, represented by his initial contribution, should be maintained in the percentage of net proceeds of sale available for distribution, asserting that “that interest is not eroded over time” and reference is made to Pierce & Pierce (1999) FLC 92-844. Pierce & Pierce is not authority for the proposition asserted by the husband. The husband’s submission seeks to focus the Court’s attention on one contribution by a party to an asset in disregard of all other contributions of all natures from the commencement of the parties’ cohabitation through to the hearing. Such an approach is, of course, contrary to requirements of the Act. From Petruski & Balewa 49 Fam LR 116 at [49]:
The task of assessing contributions under section 79 of the Act is a holistic one; what is required is to evaluate the extent of the contributions of all types made by each of the parties in the context of their particular relationship: Dickons & Dickons [2012] FamCAFC 154.
As was also said by the Full Court in Lovine & Connor (2012) FLC 93-515 at [40] and [41], such an evaluation “inevitably involves value judgments and matters of imprecision”, and, accordingly, it cannot be treated as “a mathematical exercise”.
And, again, at paragraph [56]:
…it was not appropriate to simply look at one category of contribution and give primary weight to that; all of the respective contributions of the parties are required to be assessed and taken into account.
From the Full Court in Lovine & Connor (supra) at [42]:
As part of the process of ultimately determining just and equitable orders under section 79, there is included a complex of discretionary assessments and judgments of many components of contribution, only some of which are capable of measurement in money terms and then often only in historical, rather than present, money terms. Any dictate to the effect that in the course of assessment, each disparate component part or kind of contribution must be assigned a discrete and identifiable value or percentage is antithetical to the nature of the discretion involved.
Of more recent time in Jabour & Jabour [2019] FamCAFC 78 at [55], the Full Court said:
…consistent with the authorities, the import of Pierce is that the weight to be attached to an initial contribution must be assessed against the rubric of all the contributions, both financial and non-financial, made by the parties over the course of their relationship.
I also refer to what the Full Court said at paragraph [79] of Petruski & Balewa (supra):
Once property is introduced, there is still a need to consider what contributions have been made by either party thereafter to the acquisition, if, for example, there is a mortgage involved, conservation or improvement of that property. Thus, although credit will usually always be given for the introduction of the property, it does not automatically follow that the party will receive the sole credit for any subsequent increase in value.
CONTRIBUTIONS
I have detailed the contributions of the parties and made some findings in relation thereto under the heading “Evidence” above. The husband made the initial contribution of $40,000, received by him from his previous marriage settlement, applying the whole of those funds toward the purchase of the B Street, Suburb C property, which had a purchase price of $85,000 and, apparently from the husband’s evidence, approximately another $5,000 in purchase costs, presumably relating to stamp duty and other costs of purchase.
The wife made a contribution of $26,000, received from her parents, which formed part of the funds in the $182,000 initially deposited by the wife into her new Super Fund H account in 2009.
The husband received $2,000 from his late mother’s estate which was applied to a purchase of an air-conditioner for the B Street, Suburb C property.
The wife was the primary homemaker and primarily responsible for the care of the parties’ children, Ms D and Mr F, throughout their childhood, until they turned 18 years of age, which happened for both Ms D and Mr F prior to the husband’s retirement from the business in about 2009. The wife necessarily made the primary contribution as homemaker and parent in view of the husband’s evidence, which I accept as it was uncontested and not inherently improbable, that from 1982 until 2007, he “generally worked 12 to 14 hours a day seven days per week” in the business conducted by L Pty Ltd.
It is inherent in the above that the husband was primarily responsible for the income-generating work within the business conducted by L Pty Ltd, and I find that the husband was primarily responsible for the income of the household throughout the parties’ relationship and that he contributed that income toward the acquisition, conservation and improvement of the property, of the parties, and their children, Ms D and Mr F, and toward the welfare of the family unit through providing for the living expenses.
I also find that the husband made contributions in terms of his personal exertion on the renovations carried out on the B Street, Suburb C property. I also find that he was assisted by the wife in that regard, though the main contribution was made by the husband. There is no evidence as to the effect, if any, that such renovation works had on the value of the matrimonial home.
Since separation, the husband has preserved the value of the funds to credit in his Super Fund H account whilst the wife has found need to apply some of the funds in her Super Fund H account towards her living expenses post separation.
From 7 March 2017, the husband has enjoyed occupation of the B Street, Suburb C property without accommodation expenses beyond the outgoings that go to ownership and occupation for utilities costs, rates and insurance on that property. The wife has not had the benefit of occupation of that property, but has resided with the parties’ daughter Ms D and her family on an arrangement whereby she contributes to the cost of household needs rather than paying a set sum for rent or board.
The husband in his evidence and written submissions attempts to assert that the wife has made some form of “negative contribution” by her conduct at, and attitude to, meetings with customers and referrers of work of L Pty Ltd overseas. I find on the evidence that there is no effect in any negative manner on my assessment of contributions in this regard.
For her part, the wife seems to assert in paragraph 49 of her trial affidavit that there was some wastage by the husband consequent upon occasions when he “refused on a number of occasions to invoice work done because he felt he should have completed the job sooner” in conducting the business of L Pty Ltd. There is no particularity to that evidence, no specific occasions are recited in the evidence, and whilst the wife was not cross-examined in relation to that evidence, I also find that this has no effect upon my assessment of contributions between the parties.
Again, in paragraph 50 of the wife’s trial affidavit, she refers to the husband ignoring the business bank account after the business stopped trading and the credit balance of that account being “whittled down by fees in circumstances where no income was coming into the account” and she asserts that had the husband closed that account in a timely manner, he would have saved a lot of bank fees. I note that the business account referred to is necessarily an account of L Pty Ltd and that both parties were directors of that company until its deregistration. It was open to the wife to deal with the account. This has no effect on my assessment of contributions.
Finally, in paragraph 61 of her trial affidavit, the wife refers to the husband declining to begin collecting the aged pension from when he became eligible at 65 years of age until the time when he did begin collecting the pension in 2016. She asserts that during that period, the husband “lived off our combined savings and my minimal earnings”. There is no particularity in the evidence of the sums involved, and in consequence of my finding relating to the moneys applied by the wife from the Super Fund H account in her name, particularly, and also in the husband’s name prior to March 2017 toward living expenses, I find that this part of the wife’s evidence should have no effect on my assessment of contributions.
I find that the appropriate assessment of the contributions of the parties under section 79(4)(a), (b) and (c) of the Act is 52.5 per cent by the husband and 47.5 per cent by the wife.
Any effect on the earning capacity of either party?
The husband is retired and has been in receipt of the aged pension as his almost sole source of income, subject to a tiny bit of interest, since 2016.
The wife is in part-time employment, about 15 hours per week, as a retail assistant and is in receipt of a part aged pension. The wife wishes to retire. I find that the orders proposed by each of the parties have no effect on the earning capacity of either of the parties.
Any adjustment pursuant to section 79(4)(e), referring to section 75(2) of the Act?
The husband was 76 years of age and the wife was 65 years of age at the hearing. At the time these reasons are being prepared, the husband is 78 years of age, and the wife is 67 years of age. The husband is retired and living on the aged pension. The wife is semi-retired, receiving a part aged pension and working limited hours each week as a retail assistant. The wife says in paragraph 71 of her trial affidavit:
I currently work 15 hours a week. I would like to retire.
Given the age of each of the parties, their ‘time of life’ and the evidence, I find that there is nothing in relation to the age or state of health of either of the parties that justifies an adjustment between them.
I have detailed the income, property and financial resources of each of the parties earlier in these reasons. In the event that the wife retires fully and orders are made in accordance with the orders sought by her, there would be nothing to justify an adjustment between the parties on the basis of income, property and financial resources. In the event that orders are made as sought by the husband, I find that there would be a basis for an adjustment in favour of the wife in this regard.
I find that there is no basis for an adjustment between the parties, based on the commitments of each of the parties, necessary to enable them to support themselves, and that neither party has the responsibility for the support of any other person and neither is cohabiting with any other person.
In the event that orders are made as sought by the wife, there would be no basis upon which to make an adjustment between the parties on the basis of a standard of living that, in all the circumstances, is reasonable, but in the event that I made the orders as sought by the husband, there would be a basis to make an adjustment in favour of the wife in this regard, given that the husband would be maintaining the standard of living enjoyed by him prior to, and after the parties’ separation, whilst the wife would be in significantly reduced circumstances from that standard.
I find that earning capacity is not a relevant consideration in this matter.
I have found on the evidence that the wife was principally responsible as between the parties, and as conceded by the husband, for the day-to-day care of the husband’s sons, Mr P, Mr Q and Mr R, when they were members of the parties’ household. I do not have specific evidence as to the duration of the periods of time when they were members of the household, but, on the husband’s evidence, it was not inconsiderable. In line with the decision of the Full Court in Robb & Robb (1995) FLC 92-55, the wife’s contribution to the welfare of the husband’s children from his previous relationship, through her principal homemaker role and in parenting those children, is not a matter considered under contributions, given the specific wording of section 79(4)(c) in confining that consideration to “any children of the marriage”, but it is for consideration, if at all, under section 75(2)(o) ‘any fact or circumstance which, in the opinion of the Court, the justice of the case requires to be taken into account.’ In this regard, I do consider that there is a basis for an adjustment in favour of the wife.
I find that an appropriate adjustment on considering all of the relevant matters in section 75(2) of the Act is an adjustment in favour of the wife of 2.5 per cent. That 2.5% of the matrimonial asset pool is equivalent to $34,835.
Accordingly, I find that an appropriate division of the matrimonial pool, on a one pool or global approach, including superannuation entitlements of the wife, is an equal division between the parties.
WHAT ORDER IS APPROPRIATE TO ALTER THE INTERESTS OF THE PARTIES IN THE PROPERTY?
Both parties accept that an order for sale of the B Street, Suburb C property is appropriate, the difference between them being that the wife seeks such an order immediately, whereas the husband seeks that a sale only occur when he has vacated the B Street, Suburb C property by reason of ill health or incapacity, personal choice or death. I have found that it is appropriate to reject the approach proposed by the husband, and, in keeping with the legislative requirements found in section 81 of the Act, I will make an order for the immediate sale of the matrimonial home, for such sale to be initially by private treaty, with the property going to auction at the expiration of three months on the market for private sale if it is not sold, that process to repeat thereafter at six-monthly intervals until the sale is achieved. I propose to make orders dealing with any disagreement between the parties relating to matters going to a sale of the property, such as identification of suitable marketing agent and listing price or reserve price, by the parties having recourse to the relevant president of the Australian Property Institute in relation to pricing and of the Real Estate Institute of New South Wales in relation to identification of an agent if they cannot agree.
The husband proposed that I make an order that the wife transfer to him the whole of her shareholding in T Shares, but that proposal was founded on his case that he should receive 70 per cent of the available matrimonial pool and in circumstances where he proposed that the wife would retain her entitlements as a member of Super Fund G.
I consider that it is appropriate to make an order that provides for the wife to retain all of the property she currently has, other than the B Street, Suburb C property, being her two Westpac bank accounts, her Super Fund H account, her Motor Vehicle 2, her T shares and her household contents in her possession and to include as her property all of the items listed in 5.1 to 5.34 of her minute of order, with any items referred to therein not in her possession but in the possession of the husband to be transferred to her possession as her property.
I find that it is appropriate to make an order that the husband retain all of his property, other than his equitable interest in the B Street, Suburb C property, being his Westpac bank account, his Super Fund H account, his Motor Vehicle 1, his boat, his tools and his household contents in his possession other than such of the items as are listed at 5.1 to 5.34 in the wife’s minute of order, which, if they are still in his possession, are to be transferred into the possession of the wife as her property.
I also consider that the appropriate order, as proposed by each of the parties, is that wife retain her superannuation entitlements with Super Fund G.
To achieve an equal division of the matrimonial pool between the parties on a one-pool approach that includes the wife’s superannuation entitlements, I will include in the property order provision that upon a sale of the B Street, Suburb C property, the net proceeds of sale, after deduction of costs and expenses relating to the sale, be divided between the parties in such manner that, taking into account the other property and superannuation entitlements that each will retain per the orders, there will be an equal division between them. In that regard, I note the finding inherent in my identification of the property pool in these reasons that the husband has, exclusive of his equitable interest in the B Street, Suburb C property, property to a value of $103,497, and the wife has property and superannuation entitlements to a value of $89,937.
The wife makes application that the husband pay her costs of the proceedings but she seeks an order in her written submissions that she serve on the husband a minute of order setting out the costs she seeks in respect of her costs application, a supporting affidavit and written submissions within 21 days of orders being made.
The basis upon which an application may be made by a party that the other party pay their costs of the proceedings on a final basis must necessarily take into account, unless it relates to only part of the proceedings, arguments based upon the final outcome as to why the Court should depart from the general rule in section 117(1) of the Act and make a finding that there are circumstances that justify the Court making a costs order. Accordingly, the question of costs could not properly be considered in these reasons, and I will not make any order as to costs or, indeed, any directions in relation to applications for costs and filing of documents. Any application in relation to costs may be made pursuant to order 21.02(1)(b) or (c) of the Federal Circuit Court Rules 2001 (Cth).
I certify that the preceding one hundred and thirty-seven (137) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Morley. Associate:
Dated: 25 May 2021
Key Legal Topics
Areas of Law
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Family Law
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Property Law
Legal Concepts
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Remedies
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Jurisdiction
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Costs
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Statutory Construction
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Procedural Fairness
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