Assante & Vinas
[2025] FedCFamC2F 393
•27 March 2025
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Assante & Vinas [2025] FedCFamC2F 393
File number(s): MLC 532 of 2024 Judgment of: JUDGE A. HUMPHREYS Date of judgment: 27 March 2025 Catchwords: FAMILY LAW – PROPERTY – de facto relationship of approximately 26 years with more than three years since separation – dispute as to value of a real property with a partially constructed and defective build, which both parties seek to retain – consideration of asserted “add-backs” – treatment of inheritance received by respondent after separation – assessment of parties’ contributions and matters relevant pursuant to section 90SF(3) – two pool approach taken, with respondent’s inheritance considered separately – respondent to retain 100% of inheritance at value received by him – orders providing for applicant to receive 52.5% of the non-inheritance pool and the respondent 47.5% Legislation: Evidence Act 1995 (Cth) s 140
Family Law Act 1975 (Cth) ss 75, 79, 90RB, 90SF, 90SM, 90ST, 106A
Cases cited: Babett & Falconer (2015) FLC 98-067; [2015] FamCAFC 124
Benson & Drury (2020) FLC 93–998; [2020] FamCAFC 303
Calvin & McTier (2017) FLC 93-785; [2017] FamCAFC 125
Chorn & Hopkins (2004) FLC 93-204; [2004] FamCA 633
Davey & Davey [2020] FamCA 528
Dickons & Dickons (2012) 50 Fam LR 244; [2012] FamCAFC 154
Fields & Smith (2015) FLC 93–638; [2015] FamCAFC 57
Gollings & Scott (2007) FLC 93–319; [2007] FamCA 397
Holland & Holland (2017) FLC 93-798; [2017] FamCAFC 166
In the Marriage of Aroney (1979) FLC 90-709; [1979] FamCA 62
In the Marriage of Lutzke (1979) FLC 90-714; [1979] FamCA 60
Jabour & Jabour (2019) FLC 93–898; [2019] FamCAFC 78
Marker & Marker [1998] FamCA 42
Norbis v Norbis (1986) 161 CLR 513; [1986] HCA 17
Omacini & Omacini (2005) FLC 932–218; [2005] FamCA 195
Perrin & Perrin (No 2) [2018] FamCAFC 122
Stanford v Stanford (2012) 247 CLR 108; [2012] HCA 52
Stella & Stella [2023] FedCFamC1F 1092
Wallis & Manning (2017) FLC 93-759; [2017] FamCAFC 14
Whisprun Pty Ltd v Dixon (2003) 77 ALJR 1598
Zubcic & Zubcic [2018] FamCA 129
Division: Division 2 Family Law Number of paragraphs: 137 Date of hearing: 20-21 February 2025 Place: Melbourne Counsel for the applicant: Mr Dean Solicitor for the applicant: Aspire Lawyers Representative for the respondent: Mr Vinas ORDERS
MLC 532 of 2024 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS ASSANTE
Applicant
AND: MR VINAS
Respondent
ORDER MADE BY:
JUDGE A. HUMPHREYS
DATE OF ORDER:
27 MARCH 2025
THE COURT ORDERS THAT:
The payment
1.Within 60 days of the date of these orders (“the date”) the respondent pay to the applicant the sum of $57,530 (“the payment”).
B Street, Suburb C
2.Contemporaneously with the payment, the parties do all acts and sign all documents as may be required to transfer to the applicant at the expense of the applicant all of the respondent’s right, title and interest in the real property known as B Street, Suburb C in the State of Victoria (“B Street”).
3.Pending the transfer of B Street:
(a)The applicant have the sole right to occupy B Street;
(b)The applicant pay all rates, taxes, and like apportionable outgoings of B Street as and when they fall due;
(c)The parties hold their respective interests in B Street upon trust pursuant to these orders; and
(d)Neither party encumber B Street without the consent in writing of the other party.
D Street, Suburb C
4.Contemporaneously with the payment, the parties do all acts and sign all documents as may be required to:
(a)Transfer to the respondent at the expense of the respondent all of the applicant’s right, title and interest in the real property known as D Street, Suburb C in the State of Victoria (“D Street”); and
(b)Assign to the respondent and authorise release to the respondent, all monies payable pursuant to the E Authority insurance claim relating to D Street.
5.Pending the transfer of D Street:
(a)The respondent have the sole right to occupy D Street;
(b)The respondent pay all rates, taxes, and like apportionable outgoings of D Street as and when they fall due;
(c)The parties hold their respective interests in D Street upon trust pursuant to these orders; and
(d)Neither party encumber D Street without the consent in writing of the other party.
6.In the event the respondent fails to make the payment by the date, the parties, within 30 days of the date, sign all documents and do all things to list D Street for sale by auction (“the sale”):
(a)Engaging a selling agent agreed by the parties and failing agreement, the applicant nominate three prospective agents within seven days, the respondent elect one of those nominated agents within a further seven days and failing the respondent electing an agent, the applicant elect the agent;
(b)“As is”, in its current condition, unless otherwise agreed in writing;
(c)With a reserve price of $150,000 unless otherwise agreed in writing; and
(d)With the applicant at liberty to bid at the auction to purchase D Street.
7.The proceeds of the sale be applied as follows:
(a)First to pay all costs, commissions and expenses of the sale;
(b)Secondly, to discharge any mortgage and other encumbrance affecting D Street;
(c)Thirdly, from the first $150,000 of the balance then remaining (or the whole of the balance if it is $150,000 or less):
(i)So much of the payment as is outstanding to the applicant; and
(ii)The balance to the respondent; and
(d)Fourthly, if there remain any proceeds of sale after the payments pursuant to paragraphs (a), (b) and (c) of this order, that balance be divided 52.5% to the applicant and 47.5% to the respondent.
Other property
8.The applicant retain absolutely and the respondent relinquish any right or claim to:
(a)The payment;
(b)B Street;
(c)The property at 2 F Street, Suburb G;
(d)Her Motor Vehicle 1;
(e)The proceeds of any bank account conducted in the applicant’s name;
(f)The contents of B Street; and
(g)Any liability in her sole name, with the applicant to indemnify the respondent in respect of any such liability.
9.The respondent retain absolutely and the applicant relinquish any right or claim to:
(a)D Street, subject to the provisions of these orders;
(b)The property at 1 F Street, Suburb G;
(c)The H Business (ABN …);
(d)All monies payable pursuant to the E Authority insurance claim relating to D Street;
(e)The balance of the proceeds from the sale of the property at J Street, Suburb K (being $123,200.44), paid to him pursuant to interim orders made on 21 February 2025;
(f)His Motor Vehicle 2;
(g)The proceeds from the sale of his Motor Vehicle 3;
(h)The proceeds of any bank account conducted in the respondent’s name; and
(i)Any liability in his sole name, or in the name of H Business, and he indemnify the applicant in respect of any such liability.
10.Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:
(a)Each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders;
(b)Monies standing to the credit of the parties in any joint bank account (if any) are to be divided equally and the joint account/s thereafter closed;
(c)Each party forego any claims they may have to any superannuation benefits belonging to or earned by the other;
(d)Insurance policies remain the sole property of the owner named thereon;
(e)Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and
(f)Any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
Execution of instruments by the court
11.Pursuant to section 106A of the Family Law Act 1975 (Cth) (“the Act”), in the event either party fails to execute a deed or instrument as directed by these orders, a Registrar of the Federal Circuit and Family Court of Australia (Melbourne registry) is appointed to execute the deed or instrument in the name of the defaulting party and to do all acts and things necessary to give validity and operation to the deed or instrument.
Procedural
12.All extant applications be dismissed.
AND THE COURT NOTES THAT:
A.In accordance with section 90ST of the Act, it is intended these orders will, as far as practicable, finally determine the financial relationships between the parties and avoid further proceedings between them.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE A. HUMPHREYS:
These reasons relate to an application for an alteration of property interests under Part VIIIAB of the Family Law Act 1975 (Cth) (“the Act”) and, in particular, an application pursuant to section 90SM.
Ms Assante is the applicant. Mr Vinas is the respondent. Both parties seek orders by way of property adjustment after the breakdown of their de facto relationship.
The period of the parties’ cohabitation was approximately 26 years. By the time of the final hearing, a further three years had lapsed after the breakdown of the parties’ relationship. Both parties have adult children from previous relationships but there are no children of this relationship.
The applicant ultimately sought an order altering the interests of the parties in property to achieve an outcome whereby she receives assets and superannuation with a net value equivalent to 50% of the combined value of the parties’ assets and superannuation, including an inheritance received by the respondent after separation.[1]
[1] This was the percentage-based outcome contended for by counsel for the applicant in closing submissions.
The respondent seeks an equal division of assets between the parties, excluding his inheritance. However, in achieving equality he submits various funds received and expended by the parties be taken into account, effectively as add-backs.
Several other items on the balance sheet[2] are disputed. In particular, the respondent disputes a single expert valuation of a jointly owned property with a partially constructed townhouse on it, the subject of regulatory defects and an insurance claim. Some proposed add-backs are also in dispute.
[2] Being the assets and liabilities of the parties to be distributed between them.
The configuration of each party’s property entitlement is also in dispute. Significantly, both parties seek to retain the property with the defective, partially constructed building. They each seek to complete the construction of the home they planned to build together, which was described by the respondent as their “forever home”. Initially, the applicant also sought to retain the former family home but at the conclusion of the evidence proposed it be transferred to the respondent, on a deferred basis, 12 months after the making of final orders. Retaining the former family home was not part of the respondent’s proposal.
THE ISSUES
Accordingly, the following issues require determination:
(a)The value to be attributed to the property at D Street, Suburb C (“D Street”), which is the property with the partially constructed, defective building;
(b)Treatment of the respondent’s inheritance;
(c)Is it appropriate for add-backs contended by each of the parties to be considered alongside the parties’ interests in property when making my determination, including:
(i)Paid legal costs;
(ii)The proceeds from the sale of Motor Vehicle 3 sold by the respondent after separation;
(iii)Superannuation withdrawn by the applicant and applied to the purchase of D Street in 2018 or 2019; and
(iv)Monies expended by the parties after separation;
(d)Assessment of the parties’ contributions over the course of their long relationship and after separation;
(e)What, if any, adjustment should be made to that contribution-based assessment by virtue of matters relevant pursuant to section 90SF(3) of the Act; and
(f)Which assets should each party receive (in particular D Street and the former family home at B Street, Suburb C (“B Street”)) to achieve an outcome that is in all the circumstances just and equitable?
THE HEARING
The applicant is legally represented and was represented by counsel at the final hearing. The respondent is not legally represented. He was granted leave to attend the final hearing by electronic means from Country L. He participated in the hearing by video using Microsoft Teams. That technology worked well and without interruption.
On 9 October 2024, the Chief Judge made orders at a compliance and readiness hearing listing the matter for a final hearing of two days, commencing on 20 February 2025, and issued trial directions ahead of that hearing.
Neither party filed their trial documents in accordance with those trial directions.
The applicant’s trial documents were required to be filed 42 days prior to the final hearing, so by 9 January 2025. She filed a financial statement and undertaking as to disclosure on 31 January 2025, a trial affidavit on 6 February 2025 (“trial affidavit”) and a Further Amended Initiating Application on 12 February 2025 (“Further Amended Initiating Application”). Single expert witness affidavits were filed on 3 February, 10 February, and 11 February 2025.
The respondent’s trial documents were required to be filed 28 days prior to the final hearing, so by 23 January 2025. On 13 February 2025, he filed a Further Amended Response to Initiating Application (“Further Amended Response”), which consisted of submissions rather than setting out the terms of orders the court can make to effect an alteration of the parties’ property interests. On 13 February 2025, he also filed an unsworn financial statement dated 12 February 2025. On the afternoon of 19 February 2025, the day before the final hearing was to commence, the respondent filed an affidavit without any substantive content, annexing what were identified by him as “Objections To The Affidavit” and “Objections To The Financial Statement”. Those annexed documents consisted largely of opinions and submissions in response to the applicant’s trial affidavit and financial statement. Also annexed, but not identified in the respondent’s affidavit, were a foreign document without a translation and a statement from a notary in Country L.
Outline of case documents (“case outlines”) were to be filed seven days prior the final hearing, so by 13 February 2025. The applicant’s case outline was signed and filed on 14 February 2025. The respondent’s case outline was signed and filed on 17 February 2025.
At the commencement of the final hearing, I raised with the respondent the defects in his trial documents. I flagged with the parties that, subject to submissions, I could grant leave to rely on late filed documents (excluding the respondent’s affidavit filed on 19 February 2025), and the respondent could swear to the truth of his financial statement. However, this would leave the respondent without a trial affidavit. I asked the respondent if he wished to consult with a duty lawyer and he did not wish to do so.
The respondent initially requested an adjournment. I informed the parties the first available date I could offer was 31 July 2025 and queried the need for updated valuations in the event of an adjournment as the single expert valuations would by then be over 12 months old. When the respondent was asked to address me in respect of the costs of the adjournment, including the applicant’s costs of the hearing on 20 February 2025 and the costs of updated valuations, he abandoned his application for an adjournment. He sought that the final hearing proceed, notwithstanding he had not filed a trial affidavit, preferring to have the matter finalised without further delay.
ORDERS SOUGHT BY THE PARTIES
The applicant tendered a minute of orders sought by her on 20 February 2025. [3] A minute of orders sought by the respondent was filed on 19 February 2025.[4] In contrast to his Further Amended Response, the respondent’s minute of orders sought appropriately set out orders in terms the court can make. Those documents were updated during the course of the hearing, and both parties tendered minutes of the final orders ultimately sought by them prior to closing submissions.[5] I have considered the terms of orders sought by each party.
THE EVIDENCE
[3] Exhibit A-3.
[4] Exhibit R-1.
[5] Exhibit A-4 and Exhibit R-2.
Documents relied upon
The applicant was granted leave to rely on the following documents, notwithstanding they were filed outside of the time required by the trial directions:
(a)Further Amended Initiating Application;
(b)Her trial affidavit;
(c)Her financial statement filed on 31 January 2025;
(d)Affidavit of Mr M, single expert valuer from O Company, filed on 10 February 2025, annexing his valuation report in respect of D Street dated 24 May 2024;
(e)Affidavit of Mr N, single expert valuer from O Company, filed on 11 February 2025, annexing his valuation report in respect of B Street dated 8 May 2024;
(f)Affidavit of Mr P, single expert, Q Company, filed on 3 February 2025, annexing his valuation report in respect of H Business (“the business”) dated 21 April 2024; and
(g)Her case outline filed on 14 February 2025.
The respondent was granted leave to rely on the following late-filed documents:
(a)Further Amended Response;
(b)His financial statement filed on 13 February 2025, sworn during the final hearing; and
(c)His case outline filed on 17 February 2025.
I did not grant leave for the respondent to rely on his affidavit filed on 19 February 2025, due to the very late filing of that document and where, even if the “Objections To The Affidavit” and “Objections To The Financial Statement” were adopted by the respondent as sworn evidence from the witness box, a very large proportion of that evidence would have been inadmissible.
Each party was also provided the opportunity to individually tender documents subject to submissions as to relevance. Those documents tendered were marked as exhibits.
Section 140 of the Evidence Act 1995 (Cth) sets out that the standard of proof in these proceedings is to a balance of probabilities.
I have read and considered all of the evidence adduced by the parties. If I have not mentioned a piece of evidence or an argument presented at the hearing that does not mean I have not considered it. As the High Court said in Whisprun Pty Ltd v Dixon:[6]
A judge’s reasons are not required to mention every fact or argument relied on by the losing party as relevant to an issue. Judgments of trial judges would soon become longer than they already are if a judge’s failure to mention such facts and arguments would be evidence that he or she had not properly considered the losing party’s case.
[6] (2003) 77 ALJR 1598 at [62], per Gleeson CJ, McHugh and Gummow JJ.
General observations
I make some general observations in respect of the evidence of the parties.
The applicant
In her trial affidavit, the applicant provided a concise summary of the parties’ relationship and their financial history. When information was not known to her, she said so.
I recognise it was difficult for the respondent to cross-examine the applicant and for the applicant to be cross-examined by the respondent. I have taken that into account when assessing the applicant’s evidence given under cross-examination. Whilst she was somewhat defensive and argumentative at times, the answers given by the applicant to questions put to her by the respondent were generally responsive and clear. There were details she could not remember, but that is to be expected in a long relationship such as these parties had. The applicant’s evidence was not undermined by cross-examination and where her evidence does not conflict with other evidence and is not implausible, I accept it.
The respondent
The respondent did not file a trial affidavit and did not individually tender documents as invited at the outset of the hearing. The only documents he sought to tender were summaries and calculations recently prepared by him, of no evidentiary value and therefore not accepted as exhibits. His evidence therefore consists of evidence given in his financial statement and evidence given under cross-examination.
I find the limited evidence given by the respondent unreliable. For example:
(a)His financial statement (only recently filed, on 12 February 2025) was demonstrated by his oral evidence to be inaccurate in that it did not accurately record his current income. When asked if he wished to make any corrections to his financial statement prior to being cross-examined, the respondent updated the estimate of his combined income (consisting of rental income, investment income and interest), from $800 per week to $1,000 per week. However, he did not provide an explanation for the change or as to how either estimate had been calculated, save to say that the rent he receives had “gone up a little bit”. When cross-examined, he acknowledged income from H Business of approximately $600 per week was not properly identified in his financial statement; and
(b)When cross-examined in relation to his current circumstances in Country L, the respondent avoided providing detail in his answers which suggested to me that he was not providing a complete picture of those circumstances and his financial relationship with his fiancée. This was in contrast with other aspects of the respondent’s evidence (and his efforts to adduce evidence by way of submission), where he appeared much more eager to provide detail in his answers and provide information to the court.
I put little weight on the limited evidence given by the respondent in these circumstances.
LEGAL PRINCIPLES – ALTERATION OF PROPERTY INTERESTS
Before making any order altering the interests of the parties in property, section 90SM(3) of the Act requires that I must be satisfied, in all the circumstances, it is just and equitable to do so.[7] If I am so satisfied, I then have power under the Act to make such order as I consider appropriate, after considering the matters set out in sections 90SM(4) and, by virtue of section 90SM(4)(e), those matters in section 90SF(3) so far as they are relevant.
[7] Stanford v Stanford (2012) 247 CLR 108 (“Stanford”), considering section 79(2) of the Act, being the equivalent provision in the Act relating to married couples.
In relation to this proceeding, those matters to be taken into account pursuant to section 90SM(4) are:[8]
[8] Excluding those matters relating to children of a de facto relationship, given the parties did not have children together (section 90RB).
(a) the financial contribution made directly or indirectly by or on behalf of a party to the de facto relationship, […]:
(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii) 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 de facto relationship 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 de facto relationship […]:
(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii) 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 de facto relationship or either of them; and
(c) the contribution made by a party to the de facto relationship to the welfare of the family constituted by the parties to the de facto relationship […], 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 de facto relationship; and
(e) the matters referred to in subsection 90SF(3) so far as they are relevant;
[…]
Before undertaking this task, I first briefly set out the parties’ financial history, in the context of their long relationship.
BACKGROUND
The applicant is aged 73. The respondent is aged 67. They both describe themselves as retired.
The parties commenced a relationship and began living together in or around early 1996. Their relationship broke down and they separated in December 2021. Accordingly, their de facto relationship was one of approximately 26 years.
The parties each owned a real property at the time they began living together. They also each had a car (the respondent had a company car) and superannuation.
During their relationship the parties both worked in paid employment. The applicant worked in the hospitality industry and then at a shopping centre, working five to six days a week. The respondent was a professional, at least when the parties began living together.
It is not in dispute the parties worked hard in employment and to build their wealth. They bought and sold real properties and developed some of those properties. The respondent purchased a business.
The applicant gave unchallenged evidence she was “the homemaker” during the parties’ relationship and did all cooking, cleaning, washing and other housework. She cared for her children, two of whom were under 18 for part of the parties’ relationship. She also attended to home maintenance, including some painting work. Both parties attended to the gardening. The applicant did the grocery shopping and paid for the parties’ food and deposed to the respondent managing their finances until 2021.
Significantly in 2018 or 2019, the parties purchased D Street for $220,000. The applicant applied her superannuation, in the sum of $154,000, to the purchase. In December 2020, they entered into a building contract to construct a townhouse on D Street at a cost of $445,700. The applicant contributed $138,411.50 towards the building costs and the respondent contributed $257,693.98. Issues arose with the builder and as a result the build was delayed and is still incomplete. The builder went into liquidation. A building insurance claim has been approved by E Authority for non-completion of the build and defects, in the total sum of $163,811 (“E Authority insurance claim proceeds”). The insurance claim approval summary[9] referenced a building quote from T Company to complete the build, at $494,729. Both parties seek to retain D Street and the insurance proceeds, to complete the build. The value to be attributed to D Street is in dispute.
[9] Exhibit MSA-2.
In 2021, the respondent’s father died. The respondent was a beneficiary under his will and, in mid-2023, received the sum of approximately $210,000 from his late father’s estate. The treatment of this inheritance is in dispute.
In 2021, the parties sold a property owned by them at S Street, Suburb U (“S Street”) for $1,550,000 and purchased B Street for $400,000. The applicant received $545,000 from the net proceeds from the sale of S Street, the respondent received $346,153.89 and the balance was paid to the parties’ joint account and applied to the purchase of B Street. The parties entered into a contract to purchase land at J Street, Suburb K (“Suburb K”).
The parties separated in December 2021. The applicant withdrew from the Suburb K purchase, relinquishing a deposit of $11,000. The respondent proceeded with the purchase.
On 19 January 2024, the applicant commenced this proceeding, filing an Initiating Application. The parties’ consent to the applicant’s application being made outside the standard limitation period is recorded in a notation to orders made at the first court event, on 15 March 2024.
At the first court event, the respondent acknowledged he had unilaterally sold the Suburb K property. Orders were made providing for the net sale proceeds ($123,200) to be held in trust. Orders were also made by consent providing for the transfer of one of two jointly owned investment properties to each of the respondent and the applicant (the applicant received 2 F Street, Suburb G and the respondent received 1 F Street, Suburb G). Those transfers were characterised as a part property settlement to each party, with an agreed value of $625,000 for each property.
The applicant lives in B Street, which remains jointly owned with the respondent and unencumbered. She does not live with any other person. The applicant relies on rental income and interest on savings for her financial support. 2 F Street has been vacant since December 2024 and the applicant plans some improvements before it is re-let. Once re-let, she expects to generate approximately $530 per week in rent from 2 F Street. The applicant also receives interest on savings of approximately $899 per month. Once 2 F Street is again tenanted, the applicant will therefore have a gross investment income of approximately $737 per week.
The respondent currently lives in Country L. He has re-partnered with a Country L national (described as his fiancée in his financial statement), and he lives in a home owned by her. The respondent gave oral evidence he receives rental income (from 1 F Street) and investment income (including interest), totalling approximately $1,000 per week. He also gave evidence he receives an average gross income of approximately $600 per week from his business. It was unclear from his evidence if this formed part of his investment income disclosed in his financial statement and updated in his oral evidence or if the business income was in addition to investment income.
The applicant gave unchallenged evidence that after separation the parties have shared the expenses relating to B Street and have each met the costs relating to their respective investment properties at F Street. When cross-examined, the applicant acknowledged the respondent had paid electricity expenses relating to D Street after separation.
PARTIES’ PROPERTY INTERESTS
Existing legal and equitable interests in property
In order to determine if it is just and equitable to make an order by way of property adjustment pursuant to section 90SM of the Act, I must first identify the existing legal and equitable interests of the parties in property, according to ordinary common law and equitable principles.[10]
[10] Stanford, at [37].
The parties agreed they had the following legal and equitable interests in property at the time of the final hearing:
Assets & liabilities Ownership Value B Street Joint $425,000 1 F Street Respondent $625,000 2 F Street Applicant $625,000 D Street Joint Disputed Remaining proceeds from the sale of Suburb K (held on trust) Respondent $123,200 H Business Respondent $50,000 Motor Vehicle 2 Applicant $15,000 Motor Vehicle 1 Respondent $15,000 Applicant’s bank accounts Applicant $272,500 Respondent’s bank accounts Respondent $15,200 E Authority insurance claim proceeds Joint $163,811 Monies inherited by the respondent from his late father’s estate Respondent Disputed Total $2,329,711
+ D Street
+ inheritance
Superannuation
The respondent also has superannuation:
Superannuation Ownership Value Super Fund 1 Respondent $212,735
Neither party proposed superannuation be considered separately from non-superannuation assets and I agree that is appropriate given the parties’ ages and where a superannuation splitting order was not sought by either party. I will therefore adopt a single pool approach to superannuation and non-superannuation assets, subject to the approach I take to the respondent’s inheritance.
Respondent’s inheritance
It is not in dispute the respondent’s father died in 2021, prior to the parties’ separation, and that the respondent received approximately $210,000 from his late father’s estate in or around mid-2023. The applicant deposed the inheritance had been identified from the respondent’s bank statements, received into his bank account in mid-2023, but that the balance of that account had reduced to $60,306.56 by October 2024. The respondent confirmed this in his oral evidence.
The respondent’s inheritance was included on the applicant’s balance sheet at the commencement of the hearing and submitted in the alternative to be a financial resource to the respondent. Upon hearing the respondent’s oral evidence, confirming that he has received those funds, I find the inheritance constitutes property of the respondent.
I asked the parties if they contended for a single pool approach, including the respondent’s inheritance, or a multi-pool approach, with the inheritance considered separately. Counsel for the applicant submitted either approach could be taken at the court’s discretion but ultimately proposed a single pool approach be taken, with the inheritance to be included on the balance sheet alongside all other assets. If this approach were taken, the applicant acknowledged via her counsel that the respondent should be found to have made greater contributions to the single pool of assets by virtue of his recent inheritance. The respondent maintained his position that the inheritance should not be on the balance sheet and should be disregarded when it comes to the parties’ property settlement.
Applying the legal principles set out by Strum J in Stella & Stella,[11] I prefer to consider the respondent’s inheritance in a separate pool from the balance of the parties’ assets. I do so in circumstances where the respondent’s father died several months prior to the breakdown of the parties’ very long relationship, it was not submitted the respondent’s father intended to benefit anyone other than the respondent when providing for the respondent in his will, and it was not submitted the applicant had made any contribution in respect of the inherited funds.
[11] [2023] FedCFamC1F 1092 (“Stella”), from [80] to [84], by reference to Full Court authority. Those principles were also referred to by counsel for the applicant, citing Holland & Holland (2017) FLC 93-798 and Calvin & McTier (2017) FLC 93-785.
I find it is appropriate to attribute a value of $210,000 to the respondent’s inheritance, representing the sum paid into his bank account in mid-2023, rather than the sum of approximately $60,000 remaining in that account. I do so for the following reasons, applying the principles relating to add-backs set out later in my reasons:
(a)The applicant deposed she was only able to ascertain details of the respondent’s inheritance after issuing subpoenas, in the absence of full and frank disclosure by the respondent. Even after the inheritance had been identified, the respondent did not disclose that he had disposed of a significant proportion of the inheritance, including at Part M of his financial statement. When asked where the inherited funds are, the respondent answered vaguely, “there is $60,000 at the moment in a bank account, that you’re aware of.” He did not offer an explanation about how the balance of these funds had been applied by him; and
(b)The respondent’s financial statement records that his income (even before being updated from $800 per week to $1,000 per week), exceeds his expenses of $610 per week. He gave oral evidence under cross-examination of favourable living conditions in Country L due to the exchange rate. He deposed to living in a home owned by his fiancée. In these circumstances, whilst such an explanation was not proffered by him, it appears unlikely on the evidence before me that the respondent’s inheritance was required to meet his personal expenses over the last 19 months or so.
Disputed assets and liabilities
Value to be attributed to D Street
On 11 April 2024, an order was made by consent requiring the parties to cooperate to facilitate the implementation of the building contract for D Street, at their equal cost. An order was also made by consent (as an exception to injunctions made on that day), providing that funds required to make payments for the build at D Street pursuant to contract may be paid by the applicant on behalf of the parties from a bank account identified in the orders. However, D Street remains incomplete and at a standstill in circumstances described by the applicant and by the single expert property valuer, Mr M of O Company.
Mr M was appointed to value D Street pursuant to orders made by consent on 15 March 2024. He was jointly instructed to provide a valuation of D Street “as is” and “as if completed.”
In relation to the incomplete building at D Street, Mr M reported in his expert report:[12]
We have been provided with a Compliance Certificate issued by a Registered Professional Engineer [in] June 2 stating that the slab and footings have been completed in accordance with regulations. A cancellation of a building order was however issued [in] June 2022 for ‘Building work carried out without a building permit (concrete slab) was issued by the Municipal Building Surveyor.
Furthermore, we have spoken with the Building Department of [the] Council and were advised that a Cancellation of Building Order was issued [in] March 2024 for ‘Building work carried out without a registered builder.’
Therefore, we are of the opinion that the structure constructed on-site does not comply with the regulations and the building cancellation order. Consequently, we conclude, along with the council planner, that the cancellation order issued [in] March 2024 is valid, and we do not consider the current structure compliant. The ‘as if complete’ and ‘As is’ valuation is subject to demolishing the existing structures. Additionally, the ‘As if Complete’ valuation is subject to the condition that the building will be re-constructed by a registered builder in accordance with the Planning Permit, Building Permit, and all statutory regulations. We reserve the right to revise this report if this condition is not met.
[12] At [7.7] and [10.1] of his report.
On this basis, Mr M provided his expert opinion of the market value of D Street, in its current state at $150,000 as follows:
As noted above, we have allowed for demolition costs of $20,000 and a further $50,000 as profit margin for a prudent purchaser if the property is sold in its current state in the open market. Based on our analysis of the sale evidences, we are of the opinion that the Market Value of the vacant land upon demolition of the improvements is approximately between $200,000 and $220,000. The current market value on an as is basis is calculated as below:
Market Value as vacant Land: $220,000 (upon demolition of current structure).
Allowance for demolition costs: $20,000
Allowance for profit margin: $50,000
Total Allowance: $70,000
Current market Value: $150,000 (as is basis)
Market Value – As is basis: $150,000 (One Hundred and Fifty Thousand Dollars)
Mr M was cross-examined by the respondent including about a “stoppage” in respect of the slab being “lifted” in June 2022 and the frame stage being approved by a surveyor in May 2023. Mr M gave evidence that any approvals prior to March 2024 would not impact his opinion of the value of D Street given the cancellation of building order was issued in March 2024 for “building work carried out without a registered builder.” He said it would only be any subsequent decisions or orders in respect of the building that would require him to reconsider his valuation.
Mr M also provided an opinion of value of D Street if the proposed townhouse was completed to a “turnkey” level, including fittings and fixtures, completed to a good standard in accordance with approved plans, specifications, and all local government regulations. On this basis, his expert opinion of the market value of D Street “as if complete” was $600,000.[13]
[13] At [10.1] of his report.
I adopt the expert opinion of Mr M as to the “as is” value of D Street. This reflects the value of D Street at the time of the hearing, taking into account an allowance for demolition costs and profit margin.
The “as if complete” value requires significant work to be undertaken to D Street at substantial expense. The only evidence before me of the costs to completion, is the estimate of quotation of $494,729 from T Company referenced in the applicant’s affidavit and the E Authority claim approval summary.[14] The quotation itself was not adduced. It is not known how long the rebuild will take or how much it will ultimately cost. By the time construction is complete, the value of the property with the completed building may not reflect the “as if complete” valuation undertaken by Mr M in May 2024. All of these variables make the “as if complete” valuation speculative.
[14] Exhibit MSA-2.
Accordingly, D Street will be included on the balance sheet with a current value of $150,000.
Proposed add-backs
The “adding back” of funds expended prior to a final hearing is exceptional and falls into three categories: where the parties have expended money on legal fees; where there has been a premature distribution of relationship assets; and in the case of waste or wanton, negligent, or reckless dissipation of assets.[15]
[15] Omacini & Omacini (2005) FLC 932–218 at [30].
In Chorn & Hopkins,[16] the Full Court considered the issue of add-backs, particularly in relation to post-separation expenditure and approved the following principles set out by the Full Court in Marker & Marker [references omitted]:[17]
2.10 It is well settled that save in exceptional circumstances a trial Judge should deal with the property as at the date of the hearing and make adjustments taking into account the various matters set out under s.79. […]. However, the particular justice of the case may make it appropriate to notionally add back assets which have been demonstrated to have been dissipated either during the marriage or post-separation. Normally it is necessary to demonstrate an appropriate basis for doing so, for example by wastage such as gambling or extravagant living. […] Additionally, because of the requirement for each party to bear their own costs, it is generally appropriate to add back to the pool of assets notionally any legal costs that have been spent on the litigation and to deal with the costs as a separate issue at the end of the litigation. […].
2.11There seems to be no appropriate basis for notionally adding back moneys that existed at separation but which have been subsequently spent on meeting reasonably incurred necessary living expenses. Neither the Family Law Act nor the case law require that parties go into a state of suspended economic animation once their marriage breaks down pending the resolution of their financial arrangements. Parties are entitled to continue to provide for their own support. Whether any expenditure so incurred is reasonable or extravagant is a matter that can be determined by the trial Judge.”
[16] (2004) FLC 93-204 (“Chorn & Hopkins”) at [42].
[17] Marker & Marker [1998] FamCA 42.
I will consider each of the categories of proposed add-backs in turn, applying these principles.
Monies received and applied by the parties
The respondent’s submissions were difficult to follow. However, I glean (from the schedule of assets and liabilities relied upon in his case outline,[18] the questions he asked of the applicant by way of cross-examination and his submissions) that he asserts there was some form of informal distribution of monies between the parties from the S Street proceeds in 2021 and subsequently. I understand his case to be that there should be an accounting in respect of how those monies were subsequently applied by the parties, to achieve an equal division of assets between them.
[18] At pages 4 and 5.
The respondent seeks to include on the balance sheet, as part of the applicant’s entitlements, $158,993 in superannuation withdrawn by her and paid to a Westpac account. It was not in dispute the applicant withdrew $154,000 from her superannuation and applied that sum to the purchase of D Street in 2018 or 2019. The applicant also gave evidence she lived on $20,000 from her superannuation for a year before S Street was sold and that evidence was not challenged. Accordingly, those funds have been accounted for and I am not satisfied there is any basis to notionally include the applicant’s previous superannuation balance on the balance sheet, alongside the parties’ existing assets and liabilities for division between the parties.
The respondent submits the sum withdrawn by the applicant from her superannuation was subsequently reimbursed to her from the S Street sale proceeds (which the applicant acknowledged when cross-examined) and that this and other adjustments made in 2021 explain why she received a greater proportion of the S Street sale proceeds than him. He then seeks to take into account monies applied by the parties from the S Street proceeds - for example, the differential in payments made by each of them to the D Street build from those funds. He also seems to ask the court to take into account, on the balance sheet, monies received by the applicant from S Street that are not reflected in her current bank balance. I understand this to be some form of tracing and add-back exercise.
I am not persuaded the applicant has expended monies she received from the sale of S Street or otherwise in such a way that monies expended by her should be notionally added back and considered alongside the parties’ current assets, save for monies expended on legal costs.
When cross-examined, the applicant acknowledged spending some money since separation on gambling. The respondent put to the applicant that she spent $16,000 in the first year after the parties’ separation on gambling and she answered that she did not know. The applicant was not further challenged in respect of that evidence. Even if the applicant did spend $16,000 gambling in the year after separation as was put to her, I am not persuaded that expenditure should be characterised as wastage or the premature dissipation of property rather than entertainment expenditure, given the parties’ financial circumstances and total wealth.
The applicant also admitted she gifted $10,000 to each of her three adult children, two of whom were experiencing some hardship, being $30,000 in total. In the context of the total value of the parties’ assets, I do not find these gifts constitute a dissipation of assets warranting the sums being added back and treated as property retained by the applicant. As said by the Full Court in C & C, [19] considering a proposed add-back of $15,000 in a pool of $3 million:
[…] The provision of modest amounts of capital by parents to their adult children to enable the children to get a start in life is a normal experience in our society. In a case involving the magnitude of the assets of this case, in our view it is unreasonable to conduct a microscopic examination of each offender the parties’ items of post‑separation expenditure with a view to determining whether or not it is appropriate that they be brought into account in dividing up the asset pool between them. The cases which deal with notional add-backs are generally examples of circumstances in which it would be clearly unjust and inequitable not to take those matters into account. […]
[19] [1998] FamCA 143 at [45]; approved by the Full Court more recently in Gollings & Scott (2007) FLC 93–319 at [69].
I am not persuaded the sums expended by the parties on the D Street build should be included on the balance sheet as proposed by the respondent. I will return to consider the differential in those sums when I consider the parties’ respective contributions.
Motor Vehicle 3 sold by respondent
The respondent identified Motor Vehicle 3 in his financial statement valued at $5,000. When cross-examined, he denied selling the vehicle for $6,340 until a bank statement was put to him, showing an entry recording that he had received a payment of $6,340 on 14 March 2024 with the annotation “vehicle purchase”. Whilst he first said there was some other money added to that deposit from a different item, he then conceded that sum may be added back, saying it was “neither here nor there”. In the minute of final orders sought by the respondent, it appears he proposes the parties each receive 50% of the proceeds from the sale of this vehicle, supporting the adding back of those funds.[20] In these circumstances, I add back the sum of $6,340, reflecting a premature distribution of a relationship asset, to be considered alongside the parties’ existing assets.
[20] Exhibit R-2.
Legal fees
The parties have each paid legal fees from savings originating from the sale of S Street.
The Full Court in Chorn & Hopkins confirmed that “…where the payment of legal costs can be regarded as a premature distribution of funds (in which both parties have an interest), it is appropriate to add back those costs as a notional asset.”[21] Ultimately however, the treatment of legal expenses is a matter of discretion for the court, having regard to the source of the funds.[22]
[21] at [55].
[22] at [56].
Counsel for the applicant agreed it was appropriate for the parties’ legal fees to added back and considered alongside the assets for division between them and the respondent did not speak against it. Accordingly, I add back the following sums expended by the parties on legal costs:
(a)$80,518 expended by the applicant, as identified on her updated costs notice filed on 21 February 2025 as paid from savings; and
(b)$31,263 the respondent acknowledged had been expended by him on legal costs.
Adjusted balance sheet
Taking into account the above findings and add-backs, the adjusted balance sheet is as follows:
Assets & liabilities Ownership Value B Street Joint $425,000 1 F Street Respondent $625,000 2 F Street Applicant $625,000 D Street Joint $150,000 Remaining proceeds from the sale of Suburb K land (held on trust) Respondent $123,200 H Business Respondent $50,000 Motor Vehicle 2 Applicant $15,000 Motor Vehicle 1 Respondent $15,000 Applicant’s bank accounts Applicant $272,500 Respondent’s bank accounts Respondent $15,200 E Authority insurance claim proceeds Joint $163,811 Respondent’s Super Fund 1 superannuation Respondent $212,735 Applicant’s paid legal costs, added back Applicant $80,518 Respondent’s paid legal costs, added back Respondent $31,263 Proceeds from sale of Motor Vehicle 3 Respondent $6,340 Total $2,810,567
I also consider in a separate pool:
Inherited pool Ownership Value Monies paid to respondent pursuant to his late father’s will in mid-2023 Respondent $210,000
The parties did not identify any financial resources to be taken into account.
IS IT JUST AND EQUITABLE TO MAKE AN ORDER?
Following a lengthy de facto relationship, among the assets now to be divided are the parties’ jointly owned former home at B Street and their jointly owned property at D Street. The separation brought an end to the parties’ common use of property, including B Street, where they lived together. Both parties ask the court to make orders to alter their interests in property. Whilst the respondent referred to an informal adjustment of assets between the parties in 2021 from the S Street sale proceeds, it was not contended by him that it is not just and equitable for there to be a further alteration of property interests. On this basis, I find the requirements of section 90SM(3) are satisfied and it is, in all the circumstances, just and equitable for there to be an alteration of property interests between the parties.[23]
[23] Stanford at [2].
CONTRIBUTIONS
In exercising my discretion to make orders that are in all the circumstances just and equitable, sub-section 90SM(4)(a), (b) and (c) of the Act, as set out earlier in my reasons, require me to identify and assess the parties’ respective contributions.
In undertaking this task, I am required to approach the assessment of contributions holistically, by analysing the nature, form and characteristics of those contributions with reference to the particular circumstances of this particular relationship.[24] This process involves the exercise of a wide discretion, not the performance of a mathematical or accounting exercise[25] and should be undertaken without over-zealous attention to the ascertainment of contributions.[26] Contributions should be weighed collectively, not compartmentalised with some contributions weighed against others.[27]
[24] Dickons & Dickons (2012) 50 Fam LR 244 (“Dickons”) at [21].
[25] Dickons at [25].
[26] Norbis v Norbis (1986) 161 CLR 513 at [524].
[27] Jabour & Jabour (2019) FLC 93–898 at [73]–[87]; Benson & Drury (2020) FLC 93–998 at [35].
Parties’ positions
In the applicant’s case outline, she submitted the parties’ contributions should be assessed at 53% in her favour, and 47% to the respondent. During the hearing, counsel for the applicant submitted that the parties’ contributions should be regarded as equal, save for the respondent’s inheritance. In his closing submissions, it was submitted on behalf of the applicant that a single pool approach should be taken, and the respondent’s inheritance should be included on the balance sheet, in which case the parties’ contributions should instead be assessed at 52% in favour of the respondent and 48% in favour of the applicant.
In his case outline, the respondent set out the contribution-based assessment of each party in percentage terms, at 50%. He submitted in his opening address that it has always been his intention to achieve a 50/50 division of assets between the parties. This submission was made excluding his inheritance from the pool of assets to be divided between the parties.
As indicated earlier in my reasons, I prefer a two-pool approach, considering the respondent’s inheritance separately to the parties’ other assets acquired during their long relationship and I have therefore considered the parties’ contributions to those two pools of assets separately.
Assessment
Respondent’s inheritance
As indicated earlier in my reasons, the applicant did not assert it was intended she benefit under the will of the respondent’s late father and she did not assert she made any contribution to the sum of money received by the respondent from his late father’s estate. Accordingly, I assess the respondent’s contributions to this pool, consisting only of his recent inheritance, at 100%.
Other property
In her case outline, the applicant submitted the following contributions made by her at the outset of the parties’ relationship, should be given particular weight in her favour:
(a)Her interest in an unencumbered property at the commencement of cohabitation, which the respondent acknowledged had equity of approximately $55,000. That property was sold in 2002 for $280,000, approximately six years into the parties’ relationship and now 23 years ago. The respondent gave unchallenged evidence the sale proceeds were applied to purchase and build on 1 F and 2 F Street, being the investment properties it is agreed the parties will each retain; and
(b)That she had superannuation of approximately $178,000 at the commencement of cohabitation.
The applicant acknowledged the respondent also owned a real property at the commencement of cohabitation, subject to mortgage. She was unsure of the address of the property, its value and the amount of the loan secured by mortgage. When cross-examined, the respondent gave evidence he realised approximately $100,000 from the sale of that property which was applied to the purchase of another real property. Evidence was not adduced of when this occurred. The applicant deposed the respondent also had a company car and superannuation with values not known to her.
I have considered the initial contributions made by both parties by their assets held at the time they began living together, which were ultimately applied to the acquisition, improvement and sale of real property, and accumulation of their wealth as reflected in the value of assets they now own jointly and individually. To the extent there was any disparity in the value of those contributions, that disparity has to be assessed in the context of their long relationship of 26 years and the myriad of contributions made by each of them over that time and after separation.
The applicant’s case outline identified among her contributions, a small inheritance of approximately $10,000 received from her father during the relationship. However, she did not adduce evidence in support of that claim, in her trial affidavit or otherwise.
It was not disputed the parties both worked hard during their relationship. They both worked in paid employment, undertook work in respect of their properties and the applicant made non-financial contributions undertaking domestic tasks as a homemaker.
The respondent noted in his case outline that he has a business background and contributed far more than the applicant. To the extent the respondent may be asserting the matter of his business skills is relevant to the assessment of contributions, even if there were evidence to support that he has such skills, I reject the submission. It is not supported by Full Court authority.[28]
[28] See Fields & Smith (2015) FLC 93–638 at [42].
The parties have each contributed to costs of construction at D Street and in relation to the building dispute. Whilst their contributions to the costs relating to D Street were made in different proportions, the funds they each contributed originated from relationship assets, primarily from the proceeds from the sale of S Street. The applicant acknowledged in her oral evidence that the respondent paid energy invoices relating to D Street and legal costs relating to the dispute with the builder. It appears from the respondent’s cross-examination of the applicant, that the applicant has been primarily liaising with the insurer in respect of the building insurance claim, which is a contribution made by her.
After the breakdown of their relationship, the parties have each continued to make contributions to the maintenance of the assets acquired during their relationship, including their unencumbered real properties. The applicant has lived in and maintained B Street. The parties have each maintained the F Street properties transferred to their names pursuant to interim orders made on 15 March 2024. Whether these contributions have been made from savings or post-separation income, they are ultimately sourced from relationship assets given:
(a)The respondent did not adduce evidence of contributions made by him to relationship assets or expenses from the funds inherited by him in mid-2023;
(b)The parties’ savings originated from relationship assets, particularly the sale of S Street; and
(c)Their income is each derived from investment income (rental and interest) and in the case of the respondent, business income generated from relationship assets.
I therefore reject the approach proposed by the respondent of analysing and accounting for the way in which each party applied funds received by them from the sale of their assets, including S Street for example.
I am not persuaded the parties’ contributions after separation were anything other than equal.
Whilst I have set out my consideration of the evidence in respect of the parties’ contributions somewhat chronologically and in categories for convenience (for example, referring to contributions at the outset of their relationship and during their relationship), I have nevertheless weighed and assessed the parties’ contributions of all kinds and from all sources throughout the period of cohabitation, as the Full Court in Wallis & Manning[29] made clear is the task of a trial judge. My holistic assessment of the parties’ contributions has also extended to the period after separation.
[29] (2017) FLC 93–759 at [20].
Conclusion - contributions
Having undertaken this assessment, I find the parties’ contributions, assessed in percentage terms, over their long relationship of 26 years and three years of separation, as follows:
(a)In respect of the pool of assets excluding the respondent’s inheritance: 50% to the applicant and 50% to the respondent (so, equal); and
(b)In respect of the separate pool, consisting only of the respondent’s inheritance: 100% to the respondent and 0% to the applicant (so, contributions wholly made by the respondent).
I have found the total net value of the parties’ assets, including superannuation and add-backs but excluding the respondent’s inheritance, to be approximately $2,810,567. Applying those percentages would see each of the parties receive assets (including add-backs and excluding the respondent’s inheritance) with a net value equivalent to approximately $1,405,284.
SECTION 90SM(4)(d)
Section 90SM(4)(d) of the Act requires me to consider the effect of any proposed order upon the earning capacity of either party to the de facto relationship.
Both parties seek to retain D Street, to complete the build and make the property their home. Even with the E Authority insurance claim proceeds, whichever party does so is unlikely to have sufficient resources to compete the build, quoted by T Company at $494,729, without selling an asset.
If the applicant expends her savings or sells 2 F Street to fund the build, her income earning capacity will be reduced. She deposes to the impact of losing the rental income from 2 F Street as follows:
To finance the completion of the [D Street] Property, it will be necessary for me to sell the property located at [2 F Street, Suburb G] ('[2 F Street]'). This is an extremely difficult decision for me. This property is not just a property that I own; it is a rental property that generates a steady income for me. Selling it would mean losing a reliable source of revenue, which has been crucial in maintaining my financial stability as I am retired.
The necessity to sell [2 F Street] underscores the severity of the situation . It highlights how the [D Street] property build issues have not only disrupted my mental peace but also are forcing me to make significant financial sacrifices.
I will need to continue to reside in [B Street, Suburb C] Victoria until the [D Street] Property is completed as I will be selling [2 F Street]
Likewise, if the respondent sells H Business or 1 F Street, his income earning capacity will be reduced.
Whilst not a matter relating to section 90SM(4)(d), it is relevant to my ultimate assessment that evidence was not adduced of the taxation consequences for the parties if the sale of these assets is required to fund building costs at D Street.
MATTERS RELEVANT PURSUANT TO SECTION 90SF(3)
In considering what order should be made under section 90SM, subsection 90SM(4)(e) requires me to take into account the matters referred to in section 90SF(3) so far as they are relevant.
I refer to the background set out earlier in my reasons regarding the parties’ ages, health, employment and income and my decision to treat the respondent’s inheritance in a separate pool.
Respondent’s inheritance
I am not persuaded the matters in section 90SF(3) warrant an adjustment in favour of the applicant in respect of the respondent’s inheritance, which I have considered separately from the parties’ other assets. Accordingly, I do not intend to make any orders in respect of the pool consisting only of the respondent’s inheritance. However, the existence and value of the inheritance pool is a matter I will take into account pursuant to sub-sections 90SF(3)(b) and (n) when considering the adjustment of the pool consisting of the parties’ other assets.
Other property
I find an adjustment to my contribution-based assessment of the pool excluding the respondent’s inheritance, in favour of the applicant, is warranted taking into account all of the relevant matters in section 90SF(3) as they apply in this matter, and in particular:
(a)The applicant is six years older than the respondent;
(b)Neither party adduced evidence of any significant health concerns;
(c)The respondent’s income is higher than the applicant’s income;
(d)I accept it is reasonable for the parties to both retire at their current ages. That being said, the respondent agreed H Business remains operational and I find the business provides him with an ongoing earning capacity of at least $600 per week, even if he does not work in paid employment. Whilst the respondent gave oral evidence the business is “transmitting to be sold” and is “in transition mode”, he did not adduce evidence that the business has been sold or of the terms of sale. The orders made on 11 April 2024 specifically restrained the respondent by injunction from selling, transferring, encumbering or disposing of any interest in or assets of the business without the written consent of the applicant. Evidence was not adduced that the applicant had consented to the sale of the business. As the business was valued on a “net assets on a going concern basis” rather than a capitalised future maintainable earnings basis, I take into account the income the business provides to the respondent, as well as the value attributed to the business by the single expert, Mr M;
(e)The respondent gave evidence he is living in a property owned by his fiancée in Country L, and that the cost of living there is significantly lower than in Australia due to a favourable exchange rate. He gave oral evidence his fiancée is aged 50 and a “housewife”. His financial statement records he is contributing $100 per week to her expenses. When asked under cross-examination if he provides financial support to his fiancée, the respondent said, “we help one other, yes”. When asked if he intends to continue living in Country L, the respondent answered, “I don’t know what the future will bring”. He made vague references to visa issues and his hope to return to Australia but he did not adduce evidence of any firm plan to return to live in Australia. The respondent requested and was granted leave to attend the final hearing electronically, from Country L, on the basis he was living predominantly in Country L. I find it likely the respondent will continue to spend significant time in Country L, staying in the property owned by his fiancée with significant lower living costs than the applicant, at least (on his proposal) until the construction of a home on D Street is completed;
(f)The parties’ confidence in the development potential of D Street, as demonstrated by each of their proposals; and
(g)The respondent’s inheritance, pursuant to sub-sections 90SF(3)(b) and (n), as already explained given my decision to take a two-pool approach.
In her case outline, the applicant submits the support she provides for her adult daughter (who she deposed is a single parent with a 10 year old child) is a matter relevant to section 90SF(3). Whilst the responsibility of a party to support another person, referred to in section 75(2)(e) can extend to a moral obligation,[30] in the absence of further evidence about the applicant’s daughter’s capacity to support herself and the applicant’s granddaughter, I am not persuaded this is an obligation warranting an adjustment in favour of the applicant.
[30] Lindenmeyer J in In the Marriage of Lutzke (1979) FLC 90-714, at 78, 836; and Nygh J in In the Marriage of Aroney (1979) FLC 90-709, at 78-784, cited by Rees J in Zubcic & Zubcic [2018] FamCA 129 at [535] and McClelland DCJ in Davey & Davey [2020] FamCA 528 at [89].
Taking into account all of the above matters and the configuration of the division of assets I have determined to be just and equitable which I will explain shortly, I find an adjustment to my contribution-based assessment of 2.5% to the applicant pursuant to section 90SF(3) is appropriate in respect of the non-inheritance pool of assets.
DETERMINATION
Pursuant to the above assessment, I find it just and equitable for the parties’ interests in property to be altered such that the pool of the parties’ assets and superannuation, including the add-backs and excluding the respondent’s inheritance, to be divided in the proportions of 52.5% to the applicant and 47.5% to the respondent. 52.5% of the total value of the non-inheritance asset pool (being $2,810,567) equates to $1,475,548 and 47.5% equates to $1,335,019. The differential is approximately $140,529.
The respondent will also retain the benefit of his inheritance of approximately $210,000 received in mid-2023.
If both pools are considered globally, the applicant will be retaining approximately 49% of the combined value of both pools (being approximately $3,020,567) and the respondent 51%.
I consider this is a just and equitable outcome in percentage and monetary terms taking a two pool approach as I have done and also considering that outcome globally as counsel for the applicant submitted was appropriate.
Composition of settlement
I find it is just and equitable for this percentage outcome to be achieved by the parties each retaining the following assets and with a cash adjustment of $57,530 to be paid by the respondent to the applicant.
To make up the applicant’s entitlement, she will receive/retain:
B Street $425,000 2 F Street $625,000 Motor Vehicle 1 $15,000 Applicant’s bank accounts $272,500 Applicant’s paid legal costs, added back $80,518 Payment from respondent $57,530 Total $1,475,548
The respondent will receive/retain:
D Street $150,000 1 F Street $625,000 Remaining proceeds from the sale of Suburb K land (per orders 21 February 2025) $123,200 Motor Vehicle 2 $15,000 H Business $50,000 Respondent’s bank accounts $15,200 E Authority insurance claim proceeds $163,811 Super Fund 1 superannuation $212,735 Respondent’s paid legal costs, added back $31,263 Proceeds from sale of Motor Vehicle 3, added back $6,340 Payment to applicant ($57,530) Total $1,335,019
The respondent will also retain the benefit of his inheritance, being the sum of approximately $210,000 received by him in mid-2023 of which he says approximately $60,000 remains in his bank account.
I consider this to be a just and equitable outcome, in percentage and actual terms, consistent with my holistic assessment and weighing of the parties’ respective contributions and those maters relevant pursuant to section 90SF(3) in the context of a de facto relationship of 26 years and a separation of approximately three years. I am satisfied the configuration of the proposed settlement, with the applicant to receive B Street and the respondent to receive D Street, is appropriate and just and equitable.
I find the outcome is appropriate and just and equitable even if the respondent has expended that component of his inheritance not accounted for.
This outcome is consistent with the court’s duty to end financial relations between the parties as set out in section 90ST of the Act, as follows:
In proceedings under this Division, other than proceedings under section 90SL, the court must, as far as practicable, make such orders as will finally determine the financial relationships between the parties to the de facto relationship and avoid further proceedings between them.
I find the order ultimately proposed by the applicant, that B Street only be transferred to the respondent in 12 months and a payment made to her at that time, is inconsistent with this duty, requiring the parties to remain joint proprietors of their former family home for a further year. Likewise, in respect of the late proposal put by the respondent that D Street be completed by the parties jointly and then sold.
The applicant’s proposal until closing submissions was that she retain B Street as her home, pending completion of D Street. She said she then intended to move into D Street with one of her daughters. When asked in cross-examination why she wanted to retain B Street, she said:
Because I deserved to have that place, I worked very hard with you, have given you always half of everything I’ve got even back when I first met you. And I have two dogs to worry about, I have nowhere else to go and I deserve that place to stay and to finish off the other one with my rental property to sell if I have to.
Accordingly, whilst I acknowledge the applicant’s preference to build a new home at D Street and that she will be disappointed by the order I make, I am satisfied B Street will continue to meet the applicant’s housing needs. The orders I proposed to make will see her retain her current home, rental income from 2 F Street, savings (supplemented by a payment from the respondent) and the ability to continue to earn interest on those savings. She can sell either of the real properties if she wishes to re-house herself in some other way.
The orders I intend to make will also see the respondent maintain his existing rental income from 1 F Street, income from the business (unless he sells that business), cash (earning interest) and superannuation. Subject to visa requirements, he has the benefit of accommodation with his fiancée in Country L while the D Street build is completed as he said he plans.
I am satisfied this apportionment of assets is just and equitable, providing the parties with housing, income and cash for further investment, self-support or vicissitudes.
This configuration of assets will not, on either party’s proposal, require the imminent sale of property with taxation consequences.
Chattels
The applicant seeks orders providing for each party to retain their “personal chattels and effects”. The respondent seeks an order that he retain his personal belongings in B Street, including the lift in the garage and all other items in the garage. He also seeks an order that the applicant retain the furniture, fittings and appliances in the house and “perhaps some of” the household items in the garage.
I have little evidence before me in relation to these items. The applicant disclosed household contents valued at $2,000 in her financial statement, specifically identifying a “[…] collection”. The respondent disclosed household contents valued at $2,000 in his financial statement which he identified as “furniture/fittings purchased second hand”. Neither party otherwise adduced evidence about these items. The applicant gave unchallenged evidence the parties sold her furniture for $30,000 and they each had received $15,000 from the sale proceeds. She did not say when that occurred. Evidence was not adduced in respect of the lift referenced in the orders sought by the respondent, save for in respect of a contribution the applicant acknowledged the respondent made to the cost of the lift when cross-examined by him. I do not otherwise have any evidence in respect of the lift including of its current whereabouts, state and value.
In these circumstances, I do not consider I am in a position to make an order in relation to the division of chattels. The “catch all” order I will make, as proposed by both parties, will provide for each party to retain those items in their possession as at the date of the orders I make and this will include chattels and personal belongings.
Payment
By way of explanation, I have decided to make an order requiring a payment by the respondent to the applicant rather than for the insurance payment to be apportioned, as there is no evidence before me that E Authority will act on an instruction to direct part of the insurance payment to each party.
I will make an order providing for the sale of D Street in default of the ordered payment by the respondent within 60 days, in “as is” condition unless otherwise agreed, and providing the applicant with the option to bid on D Street at auction. In the event of a default sale, the orders I make will provide that if D Street sells for more than $150,000 (reflecting the “as is” valuation of Mr M), any net surplus above $150,000 is to be divided in the same percentages I have determined are to be applied to the balance of the non-inheritance pool, being 52.5% to the applicant and 47.5% to the respondent.
Terms of orders
I will make minor amendments to the terms of other orders proposed by the parties to ensure their obligations are clear, with the aim of avoiding further disputes. For example, providing a mechanism for the appointment of a selling agent in the event of a default sale if the parties cannot agree on an agent. I will also make minor amendments to reflect the wording of the Act, including when making the proposed section 106A order and proposed section 90ST notation.
ORDER
I therefore make the final order as set out at the commencement of these reasons, considering it to be just and equitable in the circumstances.
I certify that the preceding one hundred and thirty-seven (137) numbered paragraphs are a true copy of the Reasons for Judgment of Judge A. Humphreys. Associate:
Dated: 27 March 2025
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