Amberg and Amberg and Ors (No.2) - [2011] FMCAfam 206

FEDERAL MAGISTRATES COURT OF AUSTRALIA

AMBERG & AMBERG & ORS (No.2)

[2011] FMCAfam 206

FAMILY LAW – Property settlement – husband’s failure to properly participate – non-disclosure by husband of financial documentation – no evidence of any interest acquired in the property of the wife’s parents – only debt available for distribution – limited superannuation held by each party.

Family Law Act 1975, ss.75(2), 79(2), 79(4), 117(1), (2) & (2A)

Pastrikos and Pastrikos (1980) FLC 91-987
Whitely and Whitely (1996) 92-684
In the Marriage of Clauson (1995) FLC 92–595
In the Marriage of Ferraro (1993) FLC 92-335
In the Marriage of Lee Steere and Lee Steere (1985) FLC 91-626
Russell and Russell (1999) FLC 92-877

Applicant:

MR AMBERG

First Respondent:

MS AMBERG

Second Respondent:

MR VONSTEIN

Third Respondent:

MS VONSTEIN

File Number:

BRC 6912 of 2008

Judgment of:

Coker FM

Hearing date:

4 March 2011

Date of Last Submission:

4 March 2011

Delivered at:

Brisbane

Delivered on:

4 March 2011

REPRESENTATION

Applicant:

In person

Solicitors for the Respondents:

Fitz-Walter Lawyers

ORDERS

That the Husband shall pay to the Wife the sum of NINE THOUSAND FIVE HUNDRED DOLLARS ($9,500) by way of reimbursement for half of the joint credit card liability at separation.
That each party shall retain all items of personal and real property in their respective names and/or possessions including but not limited to household chattels, bank accounts, motor vehicles and superannuation funds.
That the Husband shall pay the Wife’s costs in the fixed amount of FIVE THOUSAND DOLLARS ($5,000) within twenty-eight (28) days of the date of these Orders.
That the Husband shall pay the Second and Third Respondents’ costs in the fixed amount of FIVE THOUSAND DOLLARS ($5,000) within twenty-eight (28) days of the date of these Orders.
That all other applications in the proceedings be dismissed.

IT IS NOTED that publication of this judgment under the pseudonym Amberg & Amberg & Ors (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT BRISBANE

BRC 6912 of 2008

MR AMBERG

Applicant

And

MS AMBERG

First Respondent

MR VONSTEIN

Second Respondent

MS VONSTEIN

Third Respondent

REASONS FOR JUDGMENT

These proceedings relate to an application brought by Mr Amberg seeking orders in respect of a property settlement to be affected between he and Ms Amberg, whom I shall refer to as the wife. Joined in the proceedings as respondents two and three are Mr Vonstein and Ms Vonstein, the parents of the wife in these proceedings.
The husband commenced his application by the filing of an initiating application on 6 November 2009. In that application he sought orders with regard to financial issues yet to be resolved between he and the wife as well as in fact also seeking orders in relation to arrangements with regard to the children of the parties. Subsequently and fortunately, the parties were able to reach agreement in relation to arrangements with regard to the children.
Insofar as issues of property were concerned, there was unfortunately a most difficult outline given in the initiating application, of what orders the husband sought. As best it could be assessed, the division of assets that the husband sought in relation to proceedings was that there be a provision of one half of what the husband said was the value of the matrimonial assets and as circumstances existed at the time the husband sought to include the second and third respondents Mr Vonstein and Ms Vonstein as parties to the proceedings, because he suggested that they held on trust an interest in their property, on behalf of he and the wife.
The husband more particularly clarified the position in relation to this matter when a further amended initiating application was filed on

2 June 2010 when the orders more particularly were set out, though it still appears that it was a basic proposal that there should be a division between the husband and the wife of any interest primarily held by way of a resulting trust, in property owned by Mr and Ms Vonstein.
The husband was legally represented at one stage in relation to these proceedings and whilst his solicitors had withdrawn by the time his affidavit was filed on 3 November 2010, it did have as an attachment to it final orders that he sought with regard to property which with respect appeared to more particularly set out exactly what was proposed by the husband in relation to property settlement. Orders 1, 2 and 3 were particularly relevant though I note that orders 4 and 5 were general orders which provided for each party to retain other property in their possession as and for their own property and to indemnify each other in relation any liabilities that might be held by them or at least be held as and by way of attachment to assets retained by them.
Orders 1 through 5 of the attachment headed “Final orders sought” were in these particular terms:
1.Pursuant to section 78 of the Family Law Act 1975 (Cwth), a declaration be made that the second and third respondents hold 50% of the property at Property M, more accurately described as Lot [omitted], Title Reference [omitted] (The Property M property) on trust on behalf of the applicant and first respondent.
2.That the first respondent pay to the applicant the sum of $412,500 within 90 days of the date of this order.
3.In the event that the first respondent does not make payment to the applicant in accordance with order 2 above, the Property M property be forthwith listed for sale and the sale proceeds of that property be dispersed firstly to the applicant in the sum of $412,500.
4.That except as otherwise provided in this Order, the husband and wife are entitled to be the sole legal and beneficial owners of all items of property including money, motor vehicles, insurances, equities, superannuation entitlements, and personal effects currently in the possession or control of each of them respectively.
5.Each party shall indemnify the other with respect to any expenses, outgoings and liabilities related to those items of property which they retain or receive pursuant to these order.
The wife and her parents responded to the application by the husband. There has been a generally consistent position taken in relation to the position of the wife and her parents. Quite simply they accept as I understand it that each party should retain property in their name and possession and that each party should indemnify the other in relation to liabilities attaching to that property but that otherwise the property settlement that should be effected between the parties was as follows:
1.That paragraphs 1, 2 and 3 of the father’s further amended application filed the 1/11/2010 be dismissed.
2.That the husband pay to the wife the sum of $9,500.00, being half of the parents’ joint credit card debts at separation.
3.Other than as specifically provided for in these Orders, the parties are solely entitled to the exclusion of the others to all items of personal and real property in their respective possessions including but not limited to household chattels, bank accounts, motor vehicles and superannuation funds.
In other words that there be a dismissal of any suggestion of there being a resulting or construct of a trust in respect of property owned by Mr and Ms Vonstein.
Further orders were sought that the husband make a payment to the wife of $9500 being one half of joint credit card liabilities at the time of separation and subsequently paid by the wife and that finally as I have indicated each party retain possessions and chattels in their control as and for their own property absolutely and it is noteworthy that it was also suggested that that should include superannuation funds, there being at least some small amount of superannuation entitlement held in the name of both the wife and the husband.
Additionally the wife and Mr and Ms Vonstein sought orders in relation to the payment of costs. I have already commented at some length in previous reasons about issues with regard to non-compliance by the husband with previous directions given in relation to disclosure of documentation and provision of information, including source documents. As a result of that ruling given earlier today the matter proceeded on a somewhat different basis to the norm in that I indicated that it would proceed as had previously been indicated as a real possibility to the husband, as an undefended hearing.
The husband was however still present in the Court when the legal representatives for the wife and her parents was asked to address in relation to this matter. Quite properly I thought Ms Miller the solicitor for the wife and her parents called the wife. Whilst it would not normally have been the case, I gave the husband the opportunity to ask any questions of the wife in relation to this matter. Not surprisingly he declined to do so indicating that he was, I assume, somewhat disappointed with the previous ruling that I had given in relation to the matter proceeding as I had determined and that he intended to lodge an appeal.
It was noteworthy that the husband was in fact able to quote the sections of the Family Law Act addressing the right to bring an appeal in relation to any determination of proceeding and one can only conclude that the husband, whilst not complying with the many directions that were given with regard to production of documentation and certainly provision and disclosure of source documents with regard to income and matters of that nature, had been able to avail himself of opportunities to consider the contents of the Family Law Act and to indicate what he anticipated would be next step to be taken, in relation to proceedings.
In any event that is a matter for the husband and one would hope that it would not be the course of conduct followed in relation to the matter, simply because there has already been significant expenditure on the part of the wife and her parents in relation to these proceedings and it would be a distressing outcome in the extreme for them to be put into a position of further expense being incurred. But in any event, that is a matter for another time.
The issue to be determined here is what is the appropriate resolution of property between the parties. I of course have had the opportunity of reading the affidavit material that has been filed by the wife and by

Mr and Ms Vonstein and of course having filed material, I have also considered the affidavit of Mr Amberg, the husband, in relation to these proceedings. The husband had the opportunity to challenge the wife, she being in the witness box and available for cross-examination. He did not avail himself of the opportunity to do so.
One can only assume, I think quite fairly, that the reason that that course was taken was because the husband had determined that there was nothing that he could ask of the wife and certainly nothing that he could produce to the wife which would in any way give rise to a concern as to the veracity of the statements that she had made within her affidavit.
He indicated that he would not remain and whilst he had the opportunity to do so declined that opportunity and left the Court before there was even a suggestion of Mr and Ms Vonstein being called for the purposes of evidence and cross-examination, if he chose to do so. I draw as I believe I am entitled to do, an inference from that position taken by the husband in relation to the matter, that he accepted that there was nothing that could be put or suggested to either the wife or to Mr and Ms Vonstein which would in any way give rise to a concern as to the correctness of what they said and it was noteworthy that of course they in significant documents, have sought to corroborate the position taken by them, in relation to these proceedings.
Suffice it to say that I was most impressed by the content of the affidavits filed by Mr and Ms Vonstein and by the wife in relation to this matter and I have no doubt whatsoever as to the genuineness and the veracity of what is set out in those affidavits. What that leads to of course is the unfortunate finding that I must make in relation to this matter which is to the effect that the husband’s total lack of cooperation, total lack of compliance with any orders made and total refusal to properly participate in a proceeding that he instituted before the Court, can only be a reflection upon him of a negative nature.
Where there is divergence between the evidence of the wife and

Mr and Ms Vonstein and that of the husband, without any hesitation whatsoever I accept the evidence of the wife and of Mr and

Ms Vonstein. What that gives to rise to is the obvious disappointment, in relation to this matter. The unfortunate but obvious finding of these proceedings is that the parties quite clearly have acquired very little if any assets during their marriage of about 12 years, they having finally separated in 2007 and commenced their relationship in or about 1995.
The parties married in August of 1995 and commenced cohabitation at that time. It is interesting that the husband in his material suggests that he had assets, he says through his company [G] Australia, of about $70,000. Not a skerrick of evidence was produced in that regard and the wife says and I accept, that in fact it was a situation where neither of them brought any real assets into the relationship, other than perhaps those of a limited extent, including older style motor vehicles, personal items and the like. The husband in any event, if he were to suggest that he brought significant amounts in to the relationship lost those amounts through two bankruptcies during the period of the marriage in 1999 and again in 2006.
It seemed to be a recurring theme, that the husband was quick to lay responsibility for any difficulties, including the failure to provide documentation at the feet of others. Having read the material filed in relation to this matter it appears clear that the indications given by the husband to the wife and I accept that this occurred, was that the husband had been the subject of unfortunate business dealings and other transactions, which led to his bankruptcy.
The fact is of course that the husband produced nothing in relation to verification of those statements and I am unfortunately far more inclined to the view that the husband did not earn significant amounts but unfortunately was quick to spend as much as he could and through the good graces of Mr and Ms Vonstein, not wishing to see their daughter or their grand children in a situation of need, provided funds. I am satisfied that there is without doubt an overwhelming preponderance of evidence as to the significant contributions made therefore by Mr and Ms Vonstein, during the period of the marriage.
There were two principal purchases made during the relationship. The parties it would appear lived in rented accommodation for a period of three or four years but leading up to the birth of the parties’ first child, Mr and Ms Vonstein understandably decided, being caring and concerned parents of the wife and grandparents to a soon-to-be-born grandchild, to make arrangements to purchase a residence to provide accommodation for their daughter, their grandchildren and of course, their son-in-law.
It is clear however, that the only documentation in relation to the purchase of that first property, being what I might describe as the [L] home, was a purchase in the name of Mr and Ms Vonstein and in the name of their daughter. It was an interest-free arrangement, provided however that what might be considered to be reasonable rental was paid for the use and occupation of the property. The evidence again seems overwhelmingly to the effect that only a few payments were made before the financial circumstances of the husband and the wife were such that there were no further payments made.
The husband suggests that there was an interest acquired by him in relation to the property and that flows from the fact that the wife had an interest in the property, but there was none held in his name. It would be remiss of me to suggest that if that were to be the case, it would be in my assessment a grave injustice to the wife and certainly the gravest of injustices to Mr and Ms Vonstein and the greatest windfall one could imagine in relation to the husband.
The contribution by the wife and the husband was virtually nothing. The evidence of Mr and Ms Vonstein is, that notwithstanding their assistance continuing to be provided to the husband and the wife, there were always what I might call money troubles and shortages and these difficulties continued so that they had to provide ongoing assistance. To suggest, as the husband does, that in some way he acquired an interest by way of resulting or constructive trust would be as I say the gravest of injustices to the wife and certainly to Mr and Ms Vonstein and I reject any such suggestion, out of hand.
The husband was a bankrupt. He was a bankrupt early in the marriage. He was a bankrupt at the time of separation. He had no assets. He acquired no assets and the overwhelming indications, particularly from the husband’s own failure to provide documentation, would be to indicate that there was little income earned.
In that regard I note that as an aide memoire and it is of course only an aide memoire, assistance was provided with regard to the best indications of what the husband’s superannuation entitlements might be between 1992, three years before marriage and 2010, three years after separation. The total of the husband’s superannuation entitlements is $22,214.50 and if in fact it were the case, that that was acquired through contributions made of an employer contribution nature, then at the very most there could be suggested an income of about $260 or thereabouts per week.
That is a far more accurate reflection I would think of the income received by the husband than any of the uncorroborated and unsubstantiated suggestions contained within his affidavit of

3 November 2010. In any event there appears to be that overwhelming impression that the husband has no one to blame but himself when it comes to not corroborating the financial details in relation to proceedings.
I was as I say, very impressed with Mr and Ms Vonstein’s evidence and the evidence of the wife and unfortunately was just as unimpressed with the limited information provided by the husband. The husband seemed to portray a position of entitlement arising from the fact that he was fortunate enough to marry a woman whose parents did not wish to see her in a situation of need. It gave rise to no entitlement on his part but of course gave rise to very real concerns as to the genuineness and the appropriateness of the stance taken by the husband, in relation to these proceeding.
I turn briefly therefore to the law though there is little property to be considered in relation to this matter. There are two issues to be considered in relation to this matter. I need, obviously, to look at the law in respect of financial determinations between husband and wife and, in that regard, the relevant law is as follows. Section 79 of the Family Law Act defines the court’s powers in determining applications for property settlement. Subsection (2) of section 79 provides that:
The court shall not make an order under this section unless it is satisfied that in all the circumstances, it is just and equitable to make the order.
Section 79(4) sets out the matters the court must take into account when considering what orders should be made for the alteration of the interest of the parties in property. Those matters include:
(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 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.

The approach to the determination of an application under section 79 is well established by authority (see, for example Pastrikos and Pastrikos (1980) FLC 91-987; In the Marriage ofLee Steere and Lee Steere (1985) FLC 91-626; In the Marriage of Ferraro (1993) FLC 92-335; In the Marriage ofClauson (1995) FLC92-595 and In the marriage of Whitely and Whitely (1996) 92-684). The process ordinarily involves a multiple part procedure.
The court must first identify the assets, liabilities and financial resources of the parties and attribute a value to all assets, usually at the time of the hearing. Thereafter it must evaluate the contributions made by each of the parties as defined in section 79(4)(a) to (c). Finally, the court must consider the financial resources, means and needs of the parties, and other matters set out in section 75(2) in so far as they are relevant. An adjustment of the amount due to each party by way of contribution is then made by reference to the section 75(2) factors. It is not essential, however, that such an adjustment be made. Generally speaking, an adjustment is made because one party has greater needs and the other has stronger means. Section 75(2) is concerned with the process of arriving at a just and equitable result.
In determining what order the court should make under section 79, the court must be satisfied, in all the circumstances of the case, that the order to be made is just and equitable – not simply that the underlying percentage division of the net value of the parties is appropriate. In other words, in consideration of whether the overall result of the order in the property settlement proceedings, is just and equitable (see section 79(2)). It is the justice and equity of the actual orders that the court must consider Russell v Russell (1999) FLC 92-877.
Section 75(2) of the Family Law Act sets out the matters which must be taken into account by the court when determining applications with respect to maintenance. This is the prospective element of the determination of the application for property settlement. The assessment of contributions during the marriage is the retrospective element.
In the Marriage of Ferraro the Full Court said:
A now well established line of authority in this Court indicates the approach normally to be taken in the exercise of the discretion in s79 proceedings. That approach is firstly to ascertain the property of the parties at the time of the hearing, then to consider “contributions” of the parties within paras (a) to (c) of s79(4), and then to consider the matters in paras (d) to (g), more especially para (e) which takes up by reference the provisions of s75(2) and which are generally referred to as the “section 75(2) factors”.
The fact is that apart from some entitlements that both the husband and the wife have in relation to superannuation and apart from clothing, personal items and a few chattel items there is nothing for distribution between the parties. The wife’s proposal is that as the husband left the relationship with debts which could properly be attributable to she and he, that he should pay one half of those debts back to her, because she took on the responsibility of the repayment of those debts and took on a liability, to ensure that they were repaid. I could not agree more.
The parties commenced the relationship with little or nothing. Tragically from the perspective of the wife and unfortunately of course the children they have concluded their relationship with virtually nothing and were it not for the wonderful assistance provided by

Mr and Ms Vonstein, it would be a dreadful situation for all to be in, including of course the two young children of the relationship. The parties had little. They contributed in their own way but I have no doubt that the wife’s contribution both financial and non-financial far outweighed any thing financial or non-financial provided by the husband, in relation to the support of the family and provision for the family.
It was, as I have already indicated, a situation where without the assistance and support of the maternal grandparents, there would have been a tragedy in the making. The parties left with little at the conclusion of their relationship. As I have indicated there were some superannuation entitlements and some limited amount of personal chattels. There may have been a few furniture items and whilst there appears to have been little if any information provided in that regard, again I would find that they were of little or no real value.
The only immediately available asset is in fact not an asset but a liability. There was a debt held by the wife at the time of separation in her name, as a result of the use of credit cards but they were credit cards operated by the wife because the husband was a bankrupt and could not have credit facilities available to him. I find that they were a joint liability of the parties and it is appropriate that, whilst there may be extreme difficulty in receiving any repayment in relation to those liabilities, that the husband has an obligation in relation to repayment and that it should be affected.
There is nothing else to distribute between the parties. A splitting order would be of little assistance in relation to superannuation because of course at least one of the policies held by the husband is less than $5000 and therefore statutorily protected. The other is only a matter of a hundred or so dollars greater than $5000 and would not be probably of any real benefit to the wife. The greatest of the superannuation policies is one with [A] of a little under $16,000 and the wife to her great credit does not seek at least at this time to deprive the husband of what little there might be, in relation to future provision for his own support.
She suggests that she having worked primarily on a full-time basis during the relationship and subsequent should retain her entitlements in relation to superannuation and I would think that that is an appropriate course to follow. The contributions made by the parties to the relationship were no doubt the best they could do in the circumstances but clearly the contributions by the wife, in light of the apparent difficulties that continued to dog the husband in relation to his own financial difficulties, meant that her contribution was greater.
I find that that was the case and that it is certainly appropriate that there be a division of the liability as between the parties and that therefore the order sought by the wife with regard to a payment by the husband to her of $9500, toward the payment out of the liability already met by her is appropriate in all the circumstances. The husband’s suggestion that there was some acquired interest in the property of the wife and her parents at [L] and a developing further interest in the property at Property M, owned only in the name of Mr and Ms Vonstein is in my view, without any base or entitlement whatsoever.
One could not imagine a more opportunistic stance than that which is sought to be taken by the husband. He was bankrupt twice during the relationship. There is not a skerrick of evidence as to any contribution by him. The best that can be assessed is, as I understand the indications given by the solicitor for the wife and Mr and Ms Vonstein, that during a period of about four years some $3200, 16 payments of $200 were made to the account of Mr and Ms Vonstein from the account of the husband. He suggested before departing Court that many payments were made in cash but of course the onus fell upon him and falls upon him in that regard to prove that and he was not in a position to do so, nor did he challenge the evidence of Mr and

Ms Vonstein or the wife.
His opportunistic stance in relation to any interest in the property at Property M does him no credit whatsoever. There is no basis upon which there could be any interest shown and without any hesitation I intend to otherwise dismiss any and all applications by the husband in relation to any claim as to an interest in such property.

ORDERS DELIVERED

There is also brought on behalf of the wife and Mr and Ms Vonstein an order in relation to costs. The respondents in these proceedings have been put to enormous inconvenience and no doubt expense as a direct result of the actions or perhaps as I described it in the previous reasons, inactions of the husband. He had an onus to prepare his case and to present his case. He failed entirely to do so. I am mindful of the fact of course that section 117(1) for the Family Law Act provides that it is normally the case that each party would bear their own costs in relation to proceedings pursuant to the provisions of Family Law Act.
But as it is so often the case in life, as it is in statute, for every rule there is an exception. In section 117(2) of the Family Law Act, it provides that in the discretion of the Court, orders can be made with regard to the payment of costs. If that is to occur the Court must consider the matters that are set out in section 117(2A) and that includes of course, an assessment of the financial circumstances of the parties and other factors which are relevant. Neither party here receives legal aid. The husband did not have representation at all. The wife and her parents have sought to make financial arrangements with their solicitors for representation. There is no distinction that could properly be drawn there.
The conduct of the parties and the behaviour of the parties is however an enormously relevant consideration. The husband has failed to meet any of the obligations that fall upon any litigant, particularly an applicant, in relation to proceedings and it is a factor that weighs heavily, particularly when the wife and her parents have incurred significant expense to show their position in relation to proceedings and to ensure that they were able to justify and explain the position taken by them in relation to the matter.
Significantly here also is a situation where the husband has been entirely unsuccessful in relation to his application. His final position in relation to this proceedings was to suggest that he should receive a payment of $412,500 and that in the event of that not being paid, that the property at Property M should be sold and he should receive his entitlements of $412,500 from such sale. He has been spectacularly unsuccessful in relation to such an application and in fact the only order, as I have indicated, is that there should at least be some responsibility taken by the husband in relation to the payment of his share of the debts, that the wife was left with at the time of separation.
The husband has been wholly unsuccessful in relation to his proceedings. He has no one to blame but himself, having failed in almost every respect to meet the obligations that were required of an applicant to proceedings. I am satisfied that this is one of those instances where it would be wholly appropriate for there to be an order made in relation to the payment of costs and accordingly in relation to reserved and today’s costs, exclusive of that amount which was ordered by Purdon-Sully FM on 9 December 2010, it being a separate order for costs, I order:

ORDERS DELIVERED

I certify that the preceding fifty (50) paragraphs are a true copy of the reasons for judgment of Coker FM

Associate:

Date: 16 March 2011