ARUNACHALAM & ARUNACHALAM - [2012] FamCA 26

FAMILY COURT OF AUSTRALIA

ARUNACHALAM & ARUNACHALAM

[2012] FamCA 26

FAMILY LAW - PROPERTY SETTLEMENT – determining matrimonial asset pool – where husband has joint legal interest in a parcel of real estate with his mother – husband sought declaration of trust to the effect that he held his interest in the property on trust for his mother, or alternatively, a declaration pursuant to section 78 that he had no beneficial interest in the property – where neither declaration would result in a change to the registered proprietorship of the property – no application was made for the husband’s mother to be joined or intervene in proceedings – where husband’s interest in the property was interlinked with the parties’ matrimonial affairs – husband’s one-half legal and equitable interest in property included in matrimonial pool

FAMILY LAW - PROPERTY SETTLEMENT – contributions – parties contributions assessed globally – husband made significantly greater initial financial contribution than the wife – parties had relatively equal contributions during relationship – husband asserted he made greater financial contributions post-separation – parties lived under one roof for two years following separation – husband’s contribution-based entitlement is greater than the wife’s – husband’s entitlement to matrimonial pool measured at 57.5 per cent and wife’s at 42.5 per cent

FAMILY LAW - PROPERTY SETTLEMENT – adjustment – husband has been a high income earner – wife is a professional person – both parties likely to have long, well-paid working lives – parties’ child seven years of age – likelihood husband’s equitable interest in the property owned jointly with his mother will be retained by his mother – 5 per cent adjustment in favour of wife

FAMILY LAW - PROPERTY SETTLEMENT – just and equitable orders – husband’s entitlement to matrimonial pool measured at 52.5 per cent and the wife’s at 47.5 per cent

Family Law Act 1975 (Cth) ss 75, 78, 79

Allen v Snyder (1977) 2 NSWLR 685
Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337
Calverley v Green (1984) 155 CLR 242
Chorn v Hopkins (2004) FLC 93-204
Coghlan v Coghlan (2005) FLC 93-220
Gabel v Yardley (2008) FLC 93-386
Hickey & Hickey & Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93-143
Marriage of Bell & Bell (1993) FLC 92-347
Marriage of Burke (1993) FLC 92-356
Marriage of Nolan & Ingram (1984) FLC 91-585
Marriage of Waters & Waters (1981) FLC 91-019
Norbis v Norbis (1986) 161 CLR 513
Omacini v Omacini (2005) 33 Fam LR 134
ON v ON [2005] FamCA 1110
Strahan & Strahan (Interim Property Orders) (2009) 42 Fam LR 203

APPLICANT:

Mr Arunachalam

RESPONDENT:

Ms Arunachalam

FILE NUMBER:

PAC

6104

2009

DATE DELIVERED:

2 February 2012

PLACE DELIVERED:

Newcastle

PLACE HEARD:

Sydney

JUDGMENT OF:

Austin J

HEARING DATE:

1 & 2 December 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Givney

SOLICITOR FOR THE APPLICANT:

Warren McKeon Dickson Lawyers

COUNSEL FOR THE RESPONDENT:

Not Applicable

SOLICITOR FOR THE RESPONDENT:

Not Applicable

Orders

The wife shall pay to…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

AGLC: ARUNACHALAM & ARUNACHALAM [2012] FamCA 26
Case: [2012] FamCA 26
Decision Date: 2 February 2012

CaseChat Overview and Summary

This case concerned property settlement proceedings between a husband and wife. The primary dispute revolved around the inclusion of the husband's one-half legal and equitable interest in a parcel of real estate, which he held jointly with his mother, within the matrimonial asset pool. The husband had sought a declaration of trust or, alternatively, a declaration under section 78 of the Family Law Act 1975 (Cth) that he held no beneficial interest in the property, neither of which would alter the registered proprietorship. The court, presided over by Austin J, ultimately determined that the husband's interest in this property was intrinsically linked to the parties' matrimonial affairs and therefore ought to be included in the asset pool for division.

The legal issues before the court included the assessment of the parties' respective contributions to the matrimonial pool, considering the husband's significantly greater initial financial contribution, relatively equal contributions during the relationship, and his assertion of greater financial contributions post-separation, despite the parties living under the same roof for two years after separation. The court was also required to consider an adjustment to the parties' entitlements based on their earning capacities, the age of their child, and the likelihood of the husband's interest in the jointly owned property being retained by his mother. Finally, the court had to make just and equitable orders for the division of the matrimonial pool.

In its reasoning, the court assessed the parties' contributions globally, finding the husband's contribution-based entitlement to be greater. It then applied a 5 per cent adjustment in favour of the wife, taking into account the factors mentioned above. This resulted in the husband's entitlement to the matrimonial pool being measured at 52.5 per cent and the wife's at 47.5 per cent. The court made orders for the wife to pay a sum to the husband, thereby becoming the sole legal and beneficial owner of the matrimonial home as between the parties, with provisions for sale in default of payment. Other assets were divided, with each party declared the sole legal and beneficial owner of their respective possessions.

Orders

Orders of the court

The wife shall pay to the husband the sum of $231,061 within six weeks of the date of these orders.

Subject to compliance with Order 1 hereof, and in consideration of that payment, the wife is declared the sole legal and beneficial owner (as between the parties) of the real property and improvements comprising Folio Identifier …, being the property more commonly known as … N Street, Sydney Suburb 1, NSW (“the property”), and the husband shall do all such things and sign all such documents as may be necessary to transfer all his right, title, and interest in the property to the wife contemporaneously with his receipt of payment pursuant to Order 1 hereof.

Subject to compliance with Order 2 hereof, and in consideration of that transfer, the wife shall indemnify and keep indemnified the husband against all rates, taxes, statutory charges, mortgage repayments, and other outgoings and liabilities affecting or relating to the property.

In default of compliance with Order 1 hereof, the parties shall do all such acts and things and sign all such documents as may be necessary to forthwith list the property for sale by private treaty.

For the purposes of implementing Order 4 hereof:

(a) The listing agent shall be as agreed between the parties, and in default of agreement, with the agent chosen by ballot from the respective choices of the parties.

(b) The listing price for the property shall be as agreed between the parties, and in default of agreement, the price nominated by the listing agent.

(c) In the event of the property not being sold within 3 months from the date of its listing for sale then it shall be put to sale by public auction on the following terms:

(i) The auctioneer shall be as agreed between the parties, and in default of agreement, the auctioneer chosen by ballot from the respective choices of the parties.

(ii) The auction shall take place within six weeks of the deadline date for sale by private treaty.

(iii) The reserve price shall be as agreed between the parties, and in default of agreement, the reserve price nominated by the auctioneer.

(d) In the event that the property is not sold by auction, or private negotiation within a further seven days, then it shall be submitted to successive auctions within further six weeks periods until sold, otherwise upon the same terms and conditions as applied to the first auction.

Upon completion of the sale of the property pursuant to Orders 4 and 5 hereof, the proceeds of sale shall be applied as follows:

(a) Firstly, to pay all costs, commissions, and expenses of the sale, and to pay any Council and water rates and maintenance levies outstanding in respect of the property;

(b) Secondly, to discharge any encumbrance registered over or affecting the property;

(d) Fourthly, to pay 52.5% of the balance then remaining to the husband; and

(e) Fifthly, to pay the balance then remaining to the wife.

Pending implementation of Order 1-6 hereof, the wife shall continue to keep the property in good repair and shall continue to meet the cost of mortgage repayments, rates, levies, and insurances as and when they fall due.

The husband is declared the sole legal and beneficial owner (as between the parties) of his interest in the real property and improvements comprising the property commonly known as … S Street, Sydney Suburb 2, NSW.

The husband is declared the sole legal and beneficial owner (as between the parties) of, and the wife shall execute all such documents as may be necessary to transfer to the husband all legal and equitable title in, the following items of property:

(a) The funds banked in the joint names of the parties with the Commonwealth Bank of Australia in account number … 98; and

(b) The funds banked in the joint names of the parties with the Commonwealth Bank of Australia in account number … 18.

10.

Unless otherwise provided:

(a) Each party shall be the sole legal and beneficial owner (as between the parties) of all other assets in their respective possession as at the date of these orders, and for that purpose bank accounts are deemed to be in the possession of the person named as the account holder, investment accounts are deemed in the possession of the named investor, and superannuation entitlements are deemed in the possession of the superannuant; and

(b) Each party shall be solely liable for and shall indemnify the other against any and all debts attaching or relating to the property in their respective possession, and any debts in their respective sole names.

11.

In the event of either party refusing or neglecting to sign within seven days of a written request to do so any document necessary to implement the terms of these orders the Registrar of the Family Court of Australia at Newcastle is empowered to execute such documents on behalf of the parties pursuant to s.106A of the Family Law Act 1975 (Cth).

12.

Any and all outstanding applications are dismissed.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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