Attar & Melidis (No 2)
[2023] FedCFamC1F 444
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Attar & Melidis (No 2) [2023] FedCFamC1F 444
File number(s): BRC 3102 of 2020 Judgment of: CAREW J Date of judgment: 2 June 2023 Catchwords: FAMILY LAW – PROPERTY – Where there is a dispute about whether the husband has a legal and equitable interest in multiple properties in Country K – Where there is an absence of corroboratory evidence – Where the husband has failed to comply with his duty to make full and frank disclosure and it is necessary to adopt a broad brush approach in assessing the parties’ assets and liabilities – Where the contributions made by each party over their 19 year marriage should be considered equal – Where there is to be no adjustment under s 75(2) as there are factors favouring each party which effectively cancel each other out – Where, to achieve equality, an order is made for the wife to pay the husband the sum of $388,245 Legislation: Family Law Act 1975 (Cth) ss 45, 79, 75(2), 106A
Federal Circuit and Family Court of Australia Act 2021 (Cth) s 25(2)
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) rr 6.01, 7.22, 7.23(c)
Cases cited: Black & Kellner (1993) FLC 92–338
Hickey & Hickey and Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93–143
In the Marriage of Townsend and Townsend (1995) FLC 92–569
M & M [1998] FamCA 42
Stanford v Stanford (2012) 247 CLR 108
Weir & Weir (1992) FLC 92–287
Number of paragraphs: 140 Date of hearing: 2 – 5 May 2023 Place: Brisbane Solicitor for the Applicant: Mr Senior, solicitor advocate - Senior Legal Pty Ltd Counsel for the Respondent: Mr Shoebridge Solicitor for the Respondent: Stewart Family Law ORDER
BRC 3102 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR ATTAR
Applicant
AND: MS MELIDIS
Respondent
order made by:
CAREW J
DATE OF ORDER:
2 JUNE 2023
THE COURT ORDERS THAT:
1.Within sixty (60) days of the date of this Order, the applicant shall do all necessary things and sign all necessary documents to transfer to the respondent his right, title and interest in the property situated at B Street, City C in the State of Queensland, more particularly described as Lot … on registered plan … and all land contained within title reference number … ("the City C Property").
2.Contemporaneously with the applicant complying with the terms of paragraph 1 of this Order:
(a)The applicant and the respondent shall do all necessary things and sign all necessary documents to enable the respondent to refinance into her name the mortgage owing to ANZ with mortgage account number …;
(b)The respondent shall pay to the applicant the sum of $388,245; and
(c)Any joint bank accounts shall be closed with the funds to be divided equally.
3.The applicant shall retain to the exclusion of the respondent all assets, liabilities and financial resources in the name, possession or control of the applicant, including but not limited to:
(a)Any real and personal property in Country K;
(b)Motor Vehicle 1 with registration number …;
(c)Cash in Australia and overseas;
(d)Bank accounts in Australia and overseas;
(e)Furniture and effects;
(f)Businesses and other trading and non-trading entities registered in Australia and overseas; and
(g)The applicant's superannuation interest in Superannuation Fund 1.
4.The respondent shall retain to the exclusion of the applicant all assets, liabilities and financial resources in the name, possession or control of the respondent, including but not limited to:
(a)The City C Property subject to its mortgage;
(b)Motor Vehicle 2 with registration number …;
(c)Furniture and effects;
(d)Jewellery;
(e)Bank accounts; and
(f)The respondent's superannuation interest in Superannuation Fund 2.
5.The applicant and the respondent shall do all necessary things and sign all necessary documents to give effect to the terms of this Order and, in the event, that the applicant or the respondent refuses or neglects to do so, then a Registrar of the Brisbane Registry of the Federal Circuit and Family Court of Australia (Division 1) is hereby appointed pursuant to s 106A of the Family Law Act 1975 (Cth) to execute the deed or instrument in the name of the applicant and/or the respondent, as the case may be, and to do all things necessary to give validity and operation to the deed or instrument.
6.The applicant’s application for a stay pursuant to s 45 of the Family Law Act 1975 (Cth) is dismissed.
NOTATION:
A.There is no Court by the name “Federal Circuit and Family Court of Australia”. This Court was formerly known as the Family Court of Australia and is now known as the Federal Circuit and Family Court of Australia (Division 1).
B.The design of the seal affixed to this Order issued by the Federal Circuit and Family Court of Australia (Division 1) was determined by the Attorney-General pursuant to the undated Federal Circuit and Family Court of Australia (Seal) Determination 2021 signed by the Attorney-General.
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).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Attar & Melidis has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
CAREW J:
Mr Attar, (also known by two other names), and Ms Melidis are a divorced couple, originating from Country K, who are unable to agree about how their property should be divided. For the assistance of the annonymisation of these reasons, I will refer to Mr Attar as “the husband” and Ms Melidis as “the wife”. No disrespect to either party is thereby intended.
There are a number of matters in dispute between the parties, the most significant being:
(1)Whether or not an apartment in City L, Country K, registered in the husband’s sole name until early 2019, should be included in the balance sheet;
(2)Whether or not monies withdrawn by the husband from a joint bank account subsequent to separation should be notionally added back in their entirety; and
(3)Whether the wife’s legal fees should be notionally added back.
For the reasons set out below, I have determined that the apartment in Country K should be included in the balance sheet, the monies withdrawn by the husband subsequent to separation should not be notionally added back in their entirety but only to the extent of the sum used to pay his legal fees of $58,018, and that the wife’s legal fees should not be notionally added back. There are additional findings made in these reasons which inform the ultimate outcome.
The order I propose to make will divide the property of the parties (as determined in these reasons) equally. As the wife has the capacity to retain the former matrimonial home, she will have the opportunity to pay the husband a sum of money in order to achieve equality.
PROPOSALS OF EACH PARTY
In summary, the husband submits that the apartment in City L, should not be included in the balance sheet, that only his legal fees should be the subject of a notional add back (not the entirety of the sum withdrawn by him subsequent to separation) and that the wife’s legal fees should be notionally added back. The husband submits that contributions should be assessed in his favour in the proportion 55/45 (if the City L apartment is included in the balance sheet but if it is not then contributions should be assessed as equal) and that there should be an adjustment of five percent in his favour pursuant to s 75(2), primarily due to the wife’s greater earning capacity and his poor health. The husband proposes the property division should be in his favour in the proportion 60/40 (if the City L apartment is included) or 55/45 (if it is not) and that the former matrimonial home should be sold. The precise terms of the order sought by the husband are set out in his further amended Initiating Application filed 25 April 2023.
In summary, the wife submits that the apartment in City L should be included in the balance sheet, that the entirety of the sum withdrawn by the husband subsequent to separation should be notionally added back and that none of her legal fees should be added back. The wife submits that contributions should be assessed as equal and that any adjustments cancel each other out so that the division of the property should be 50/50. The precise terms of the order sought by the wife are set out in her amended Response filed on 1 April 2023 (save that the wife abandoned her claim for 52 percent of the assets in favour of an equal division).
BACKGROUND
The husband and wife met and married in 1998. They separated on a final basis on 5 November 2017 and a divorce order was made in Australia in 2019. There are two adult children of the relationship, Ms M born in 1999 and Ms N born in 2003.
The husband is 68 years of age. He was born in Country K and travelled to the United Kingdom to complete his senior school and university education before immigrating to Australia in 1982. He was granted Australian citizenship in 1987.
The husband is self-employed through his business, O Pty Ltd. The business involves advertising, particularly in Country K. The husband has operated the business for 23 years. It is common ground that the impact of the Covid-19 pandemic and the deterioration in the husband’s health has significantly impacted his business. The husband contends that his business has “ceased” although there was some suggestion during his oral evidence that he may have been undertaking some work on a limited basis.
The husband is currently in receipt of an Australian pension from Centrelink of $610.50 per week. As at 28 April 2023, it was common ground that the husband had deposits in his Westpac Bank accounts of about $11,000.
According to the husband, he was diagnosed with a serious illness in 2017 and was listed as a transplant patient in late 2017 (although the husband also gives an alternative year of that diagnosis being in 2014). The husband underwent a transplant in 2022 and suffers from a medical condition resulting from a post-operative complication. The husband is required to take about 17 medications daily.
The wife is 58 years of age. She was also born in Country K and immigrated to Australia with the children in 2007 in the company of the husband. The wife is a health professional employed at the Q Centre. It is common ground that the wife has an earning capacity of $400,000 to $440,000 per annum.
The wife graduated from the R University with a degree in 1995. Following graduation, the wife proceeded to work as a health professional from 1995-1997, before undertaking further specialist training in 1998.
The wife completed her specialist training in 2000 and graduated in early 2001. The wife thereafter worked as a health professional until shortly prior to her immigration to Australia in 2007. On her relocation to Australia, she passed the necessary assessments by her professional organisation and gained employment with P Company commencing in mid-2011.
The children live with their mother at B Street, City C (“the former matrimonial home”). At the date of separation, Ms M was 17 years of age and Ms N was 13 years of age. Ms M recently completed a degree and subsequently obtained an administrative position for about seven or eight months. She is not currently employed. Ms N is currently undertaking some casual employment. The wife’s unchallenged evidence is that she supports the children to the extent of providing a home for them and meeting their combined expenses of $775 per week. Subsequent to separation, the husband made direct payments to the children. From 2019 until January 2022, the husband paid Ms M $250 per month. In 2019, the husband paid Ms N $50 per month and in 2020 he increased that sum to $150 per month. No payments have been made by the husband for the children’s support since January 2022.
Since separation, the wife has had the benefit of living in the former matrimonial home although she alone has met the mortgage repayments, rates and all other outgoings in relation to the home.
In 2020, the wife was diagnosed with an autoimmune disease and from February 2021, she reduced her hours from 40 to 34 hours per week. Currently, the wife works “80% of a full time position”.
ISSUES
The parties identified a list of significant issues requiring determination at the case management hearing when trial directions were made. The parties amended the issues for determination at trial and they are as follows:
The Pool
(1)Whether each of the parties have complied with their duty to give full and frank disclosure of all information and documents relevant to an issue in the case and, if not, what are the implications of non-disclosure?
(2)Whether the property situation in T Region, City L (“the City L apartment”) should be included in the property pool for division between the parties?
(3)What value should be attributed to the City L apartment?
(4)Whether the sum of $194,030 withdrawn by the husband from the joint ANZ Access Advantage Account number … should be ‘added back’ to the property pool for division between the parties?
(5)What value should be ascribed to the property at B Street, City C?
(6)What value should be ascribed to the furniture and specialist items in Country K?
(7)What value should be ascribed to the wife’s jewellery in Australia?
Contributions
(8)How should each of the parties’ contributions be assessed, noting each party deposes to making greater contributions than the other, particularly during the relationship, including financial and non-financial contributions?
Section 75(2) factors
(9)How should each of the parties’ future means and needs be assessed, noting each party deposes to having greater ‘future needs’ than the other? (I do not believe the reference to ‘future needs’ is an accurate reflection of the parties’ submissions. The submissions addressed a number of s 75(2) factors)
APPLICABLE LEGAL PRINCIPLES
In property settlement proceedings, the Court may make such order as it considers appropriate, altering the interests of the parties to the marriage in the property of the parties or either of them, including an order for a settlement of property in substitution for any interest in the property for the benefit of the parties, and an order requiring either or both of the parties to the marriage to make, for the benefit of either or both of the parties, such settlement or transfer of property as the Court determines (s 79(1) of the Family Law Act1975 (Cth) (“the Act”)).
The Court cannot make an order unless it is satisfied that, in all of the circumstances, it is just and equitable to make the order (s 79(2)).
In considering what order (if any) should be made in property settlement proceedings, the Court is required to take into account the following (s 79(4)):
(a)The financial contribution made directly or indirectly by or on behalf of a party to the acquisition, conservation or improvement of any property of the parties or either of them, whether or not that property still exists;
(b)The contribution (other than financial) made directly or indirectly by or on behalf of a party to the acquisition, conservation or improvement of any property of the parties or either of them, whether or not that property still exists;
(c)The contribution made by a party to the welfare of the family constituted by the parties and any children, including any contribution made in the capacity of homemaker or parent;
(d)The effect of any proposed order upon the earning capacity of either party;
(e)The matters referred to in s 75(2) of the Act so far as relevant;
(f)Any other order made under the Act affecting a party; and
(g)Any child support under the Child Support (Assessment) Act 1989 (Cth) that a party has provided, is to provide, or might be liable to provide for a child of the marriage.
The High Court of Australia in Stanford v Stanford[1] identified certain principles to be applied in property settlement proceedings. In particular, when considering whether it is just and equitable to make an order, it is firstly necessary to identify, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property.[2] Secondly, the discretion as to whether or not to make a property settlement order, although extraordinarily wide, must nevertheless be exercised in a principled way.[3] Thirdly, there is no presumption that the parties’ rights to or interests in property are or should be different from those that currently exist.[4] The consideration of whether it is just and equitable to make an order should not be considered by reference only to the matters in s 79(4). It is necessary to give separate consideration to s 79(2) and (4) and not to ‘conflate’ the two subsections.[5]
[1] (2012) 247 CLR 108.
[2] Ibid at 120, [37].
[3] Ibid at 120–121, [38].
[4] Ibid at 121, [40].
[5] Ibid at 120, [35].
Is it just and equitable to make an order?
The husband and the wife each contend that it is just and equitable to make an order. That position is understandable given that the husband and wife separated nearly six years ago and “there is not and will not thereafter be the common use of property” by the parties.[6] Additionally “the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the relationship”.[7] In such cases, the “just and equitable requirement is readily satisfied”[8] and I am satisfied in this case that it is just and equitable to make an order.
[6] Ibid at 122, [42].
[7] Ibid.
[8] Ibid.
I set out below the balance sheet as contended for by each party and then turn to consider the issues as identified by the parties for determination.
BALANCE SHEET
The balance sheet was amended late in the trial and ultimately set out in exhibit 12.[9]
[9] The numbering in Exhibit 12 has been updated in the table set out in these reasons.
Description Ownership Husband’s value Wife’s value ASSETS Real Property 1 B Street, City C Joint $2,600,000 $2,200,000 2 V Street, City L (the "City L apartment") Husband $0.00 $563,492 3 Other properties in Country K Husband $0.00 Not known Vehicles & Chattels 4 Motor Vehicle 2 Wife $25,000 $25,000 5 Motor Vehicle 1 Husband $30,000 $30,000 6 Household Furniture (Australia) Joint $19,915 $19,915 7 Specialist items Wife $0.00 $0.00 8 Jewellery Wife $0.00 Nominal 9 Furniture and Effects in City L apartment Husband $2,840 $19,915 Businesses 10 O Pty Ltd and W Business Husband $0.00 Not Known 11 ANZ Account xx – …84 Joint Nil Nil 12 ANZ Account xx – …92 Joint Nil Nil 13 Westpac Account xx – …62 Husband Negligible $2,980 14 Westpac Account xx – …87 Husband Negligible $5,853 15 Westpac Account xx – …57 Husband Negligible $2,473 16 Cash at bank in Country K Husband $0.00 Unknown 17 Cash at bank in Country K Wife Undisclosed Nil 18 CBA Account xx – …91 Wife $4,531 $4,531 19 CBA Account xx – …87 Wife $3,509 $3,509 20 CBA Account xx – …89 Wife $403 $403 Assets subtotal $2,686,198 $2,878,071 LIABILITIES 21 ANZ Mortgage Joint $1,026,602 $1,026,602 22 ATO Liability Wife $0.00 $0.00 23 BAS Wife $0.00 $0.00 24 TT Credit Card Wife $0.00 $2,234 Liabilities sub-total $1,026,602 $1,028,836 SUPERANNUATION Name of Fund Type of interest Member Husband’s value Wife’s value 25 Superannuation Fund 2 Accumulation Wife $308,365 $308,365 26 Superannuation Fund 1 Accumulation Husband $94,668 $94,668 Superannuation subtotal $403,033 $403,033 TOTAL (assets – liabilities) $1,659,596 $1,849,235 TOTAL (assets – liabilities + superannuation) $2,062,629 $2,252,268 FINANCIAL RESOURCES Description Ownership Husband’s value Wife’s value 27 Prepaid Mortgage Wife $19,977 Nil net effect Financial resources subtotal $19,977 OTHER – ADDBACKS Description Ownership Husband’s value Wife’s value 28 Marriage Portion “[Marriage Gift]” Wife $7,310 $3,926 29 Funds removed by applicant Husband $0.00 $194,030 30 Legal Fees Paid Wife $244,806 $0.00 31 Legal Fees Paid Wife $39,000 $0.00 32 Legal Fees Paid Husband $58,018 $58,018 Other subtotal $349,134 $255,974 TOTAL (assets – liabilities + superannuation + financial resources + other $2,431,740 $2,508,242
Balance sheet issues
As to item 1, for the reasons explained below, I propose to include the value of the former matrimonial home at $2,200,000.
As to item 9, for the reasons explained below, I propose to include the value of the furniture and effects in the City L apartment at $2,840.
I note that certain amendments were made in exhibit 12, on behalf of the husband, prior to it being tendered. Items 13, 14 and 15 in the balance sheet, being the balances of the husband’s Australian bank accounts, had been agreed at the sums listed on the wife’s side of the ledger. No notice was given to the wife that the amendments would be made and accordingly, the husband was not cross-examined about the amendments. I propose to adopt the agreed amounts as contained in the balance sheet that was filed by the husband on 28 April 2023, and relied upon by him at the commencement of the trial. The agreed amounts are as set out on the wife’s side of the ledger in the balance sheet set out above.
Likewise, item 24 in the balance sheet, being the balance owing on the wife’s TT credit card was previously agreed as a deduction in the balance sheet. Again, no notice was given to the wife that the amendment would be made and accordingly I propose to adopt the agreed amount as contained in the balance sheet that was filed on 28 April 2023.
Item 27 is a sum of $19,977 described as pre-paid mortgage which the husband contends should be treated as a financial resource of the wife. The wife agrees that she pre-paid the mortgage by this sum from her post-separation income but upon realising she had the ability to withdraw the advance payments she did so and paid the redrawn sum to her lawyers in part payment of legal fees. The sum will not be treated as a financial resource.
As to item 28, being the ‘Marriage Gift’ paid by the husband to the wife, a sum remains in a bank account in Country K in the joint names of the wife and her father. Its current value is AUD$3,926 which is the value I will include in the balance sheet.
As to items 29, 30, 31 and 32, for the reasons explained later in these reasons, the only notional add back I propose to include in the balance sheet is the agreed fees paid by the husband to his lawyers obtained from the joint account after separation in the sum of $58,018. I am satisfied that the larger sum of the wife’s legal fees were likely to have been paid from her post‑separation income. As to the smaller sum of $39,000, I note that the first payment of the wife’s legal fees was on 20 November 2017, i.e. after separation, at a time when the wife’s income was substantial. I do not propose to notionally add back any of the wife’s legal fees.
There are also ‘notes’ included in exhibit 12, to which counsel for the wife indicated he had not had the opportunity for any input. Accordingly, where anything contentious is included in the ‘notes’, I do not propose to have any regard to them. I note for example, the solicitor advocate for the husband has included a note about the valuation of the former matrimonial home that the husband relies upon the “adversarial witness evidence”. There is no evidence from an adversarial witness.
WHETHER EACH OF THE PARTIES HAVE COMPLIED WITH THEIR DUTY TO GIVE FULL AND FRANK DISCLOSURE OF ALL INFORMATION AND DOCUMENTS RELEVANT TO AN ISSUE IN THE CASE AND, IF NOT, WHAT ARE THE IMPLICATIONS OF NON-DISCLOSURE?
Each party alleges the other has been less than forthcoming in meeting their duty to give full and frank disclosure of all information and documents relevant to an issue in the case, as required by r 6.01 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (“the Rules”). The husband, for instance, contends that the wife has failed to produce documents to support her contention that she contributed to a substantial extent to the expenses of the family from her income, particularly prior to 2007. The wife, on the other hand, contends that the husband owns additional property in Country K that he has not disclosed, and that he has failed to provide disclosure to support his contention that he paid significant family expenses (other than rent) when she too was employed.
During the trial, each party, at times, responded to questions that they had failed to disclose particular documents in a similar way i.e. “I was not asked”.
To the extent that each party was unable to produce documents evidencing their incomes from many years ago, it is hardly surprising given the passage of time. Ultimately, it seemed to be accepted on behalf of the husband, that to the extent there was criticism of the wife for failing to disclose documents corroborating her income at particular times early in the marriage, the appropriate approach was to simply note that neither party could prove the quantum of their income at particular times, other than as accepted by each party from the documents that had been disclosed.
Of more significance is the husband’s failure to provide all information and documents relevant to a possible inheritance from his father’s estate (his mother died some years after his father however, the estate is referred to by both parties as the husband’s father’s estate) that is yet to be finalised. The first reference to the prospect of a further inheritance was given by the husband during his oral evidence, but before setting out that evidence it is necessary to review what the husband says in his evidence in chief about inheritances.
In his trial affidavit the husband deposes:
26. About six months after I moved the family to Australia my father passed away in 2007 and he left an estate to be divided between my two brothers, my sister and me. To the best of my recollection the estate comprised:
a. House, which was sold for 3,125,000,000 [Country K currency];
b. Cash of 1,200,000,000 [Country K currency].
27. [struck out]
28. My father’s estate was divided equally between my brothers, my sister and me less costs. My best recollection is a (sic) I received the money in [Country K] and it had a value of the equivalent of $95,000 AUD.
29. My inheritance was applied to the care and wellbeing of the family, including migration costs to Australia, holidays in Europe and America.
(Emphasis added)
The husband in no way suggests in his evidence in chief that the estate of his father was still being administered or that he anticipated the possibility of receiving anything further from his father’s estate.
In the wife’s trial affidavit she deposes:
166. In 2007 when [the husband’s] father passed away [the husband] told me that he received an inheritance. [The husband] never told me how much exactly he received. He told me it was some money in a bank account in [Country K] and one property which was supposed to be sold and the proceeds distributed between [the husband] and his three other siblings and his mother. I never saw any funds from this inheritance. I do not know if [the husband] really received this inheritance and if he did I do not know how he used the money.
In his reply affidavit the husband deposes:
61. I have previously answered this issue, I maintain that my inheritance was applied to the welfare of the family.
There is no evidence corroborating the receipt by the husband of the equivalent of $95,000 by way of inheritance.
During cross-examination, the husband was asked about the contents of a letter he had written to the wife on 22 May 2013 headed “list of bank accounts and properties – [husband’s name]”. The letter was sent to the wife under cover of an email from the husband which said:
…
Here is what we have financially at present in [Country K] & Australia. Keep it.
…
In the letter, the husband sets out a list of “properties” in Country K as follows:
1. Six equal shares [Full ownership] [See *Translator's Note below] of the Apartment located in [T Region] [City L], with Title Deeds No […] issued by Deeds and Properties Registration Office of [Country K] (District […] of City L), Property No […] and Registration No […].
2. Six equal shares (Full ownership) of a Block of Land, with Registered […] of [Suburb Z] [X Region] with area of […] square meters, Its File No in [City Y] is […]. All of the documents are kept in an envelope at home.
3. 24.37 Shares […] located in [City BB] which has been registered in [City CC]. The same amount belongs to [Mr DD].
4. 5 […] Shares […] located in [City BB] which has been registered in [City CC]. The same amount belongs to [Mr DD].
5. 3 equal shares […] subdivided from the main subdivision […] in [City BB] which has been registered in [City CC]. The other 3 equal shares belong to [Mr DD].
6. 3 equal shares of the block of land […], subdivided from the main subdivision […] in [City BB] which has been registered in [City CC]. The other 3 equal shares belong to [Mr DD].
7. 3 equal shares […], subdivided from the main subdivision […] in [City BB] which has been registered in [City CC]. The other 3 equal shares belong to [Mr DD].
Also, 1.5 equal shares of 6 equal shares of the Property and […] Shares of [EE Property] […], subdivided from the main subdivision […] of [City BB] -- […] Shares of 2100 […] of [City BB] -- 3 equal shares of 6 equal shares […] subdivided from the main subdivision […] of [City BB] ---
2 equal shares of a common property, including 4 equal shares of 6 equal shares of a divided residential house […] subdivided from main subdivision […] of [City BB] including all of the accessories and inclusions. Two equal shares of this property belongs to brother and the other two equal shares belong to [Mr FF] the cousin -- 1.5 equal shares of […] subdivided from main subdivision […] of [City BB] -- 3 equal shares of […] subdivided from main subdivision […] of [City BB], which according to the final sales agreement, my parents have sold them to me. However, due to hassles and harassments of the older brother ([Mr GG]), so far it has not been registered successfully.
…
•Translator's Notes:
1- The total ownership of every property in [Country K] consists of six equal shares. One equal share is called a "[…]". In the above translation I have used "Equal Share" wherever the term […] is used in the source document.
…
In relation to the 26 May 2013 letter, the wife deposes as follows:
52. On 26 May 2013 [the husband] sent me an email stating "Here is what we have financially at present in [Country K] and Australia. Keep it." Attached was a list of assets some of which were written in [HH Language] and some in English ("the list"). Exhibit "MS-19" at page 81 of the Exhibit Bundle is a true copy is a copy of the email and the translation.
53. The list refers to multiple properties, one being the [City L] Unit, with the balance of the properties being located in other areas outside of [City L].
54. The list includes:
a. Full ownership of the [City L] Unit
b. Full ownership of land in [X Region]
c. […] portions in [City BB]
d. 50% ownership of land in [City BB] No. […]
e. 50% ownership of land in [City BB] No. […]
f. 50% ownership of land in [City BB] No. […]
g. 50% ownership of land in [City BB] No. […]
h. Additional other assets referred to as portions of common property and […] portions.
55. It was the first time that [the husband] disclosed our assets in writing.
56. The land in [X Region] referred to at paragraph 54b above is a [struck out] area of land in the tourist attraction area in [Country K]. [The husband] and I went there together on at least two occasions in about 2003 and 2004 to inspect the land and we talked about potentially building a holiday house there.
57. [The husband] told me that this land was given to him by his ex-father-in-law. [The husband] told me he had lent money to his ex-father-in-law and instead of paying him back money his ex-father-in-law gave him the land. I also saw the title to the land in an envelope that was kept at the top of a display cabinet in the [City L] Unit.
58. The assets referred to at paragraph 54c to 54h above are the list of [properties] in [City BB] that [Mr Attar], the children and I had been to several times. Renovations were done to the house […] in about 2012 and [the husband] paid for and oversaw the renovations. The last time we were there was in 2012.
…
60. On 14 October 2021 I instructed my solicitors to forward correspondence to [the husband’s] solicitors providing a copy of the email from [the husband] to me dated 26 May 2013 together with the translation and requesting a response including whether [the husband] still holds the interests and if not details of how the interests have been disposed and the utilisation of the sale proceeds. Exhibit "MS-20" at page 88 of the Exhibit Bundle is a true copy of this correspondence.
61. On 26 October 2021 Senior Legal responded that "I am instructed that the translation attached to your letter is the disputed [Country K] property'. Exhibit "MS-21" at page 96 of the Exhibit Bundle is a true copy of this correspondence.
62.Beside item 2 in the list is a statement "All documents are kept in an envelope at home". I understand "at home" to mean the [City L] Unit. In the [City L] Unit there was a display cabinet with a hidden portion at the top where we kept all of our documents.
63. There have been multiple calls for [the husband] to disclose these documents however they have not been provided.
(Emphasis added)
In his reply affidavit the husband responds as follows:
19. In reply to paragraphs 52 - 55, I say that items listed b - h inclusive are not owned by me [balance struck out].
20. In reply to paragraphs 54 (b) The property identified [X Region] was advertised for general sale, I submitted an expression of interest for the land, but I was unsuccessful.
21. It is false statement by [the wife] that I told her that my ex father in law had given the land to me. The statement that I had loaned money to my ex-father-in-law is also false.
22. I do not know what to make of [the wife’s] allegation that she saw the Title to the land in an envelope that was kept at the top of a display cabinet in the [City L] Property. I do not possess such title to the land, nor the envelope as alleged by [the wife].
23. I deny the contents of paragraph 58 of [Ms Melidis'] affidavit save that I say, the “[…] House in [City BB]” remains in the estate of my late father which is controlled by my brother [Mr GG].
…
25. In reply to paragraph 62, I say that the list referred to by [the wife] was nothing more than a wish list and I do not own the properties as alleged.
(Emphasis added)
During cross-examination, the husband agreed he sent the email and letter dated 26 May 2013 but contended that other than the City L apartment, he did not in fact own any of the other property. In particular, the husband denied he owned the block of land in the X Region, or that he had a half interest in another four blocks of land in City BB. The husband claimed that the list of property in the letter (other than the City L apartment) was a “prediction of what we could have, and the gift that we could have”, and what “could come … to us … from my late parents”. The husband’s father died in 2007 and his mother died in 2011 or 2012. Ultimately, the husband agreed that the five blocks of land and the shares were “possible inheritances”.
The husband was pressed about his alleged ownership of the land in the X Region, and it was suggested to him that he did have the title deed for that property. Contrary to his evidence in chief, the husband conceded that he did have the title deed initially in Country K and that he had brought it with him to Australia. The husband suggested that the title deed was at the former matrimonial home. The husband conceded that the wife’s lawyers had previously asked him to produce the title deed and he had not done so. The claim by the husband that the title deed was in a particular place in the former matrimonial home was first made during the trial.
The issue of the husband’s ownership of these other properties is further complicated by the absence of evidence from any land registry in Country K. The wife contends that, as a woman, she had no legal right to conduct the relevant searches. The husband disputes this. I have no ability to determine the true position, although I note that the wife did apparently cause a search of the land title registry to be undertaken in Country K on or about January 2019 in relation to the City L apartment. The wife contends that the only way she was able to obtain that information was because she had commenced proceedings in Country K for the husband to pay her a ‘Marriage Gift’ (under religious law, a ‘Marriage Gift’ is a gift that the groom is obliged to give the bride at the time of the religious marriage or at any stage of their marriage). The wife contends that as a result of those proceedings “the family court in [Country K] gave authority for [her [Country K] lawyer] and me to legally search for [the husband’s] assets in [Country K]”. The wife further contends that the husband promptly agreed to pay the ‘Marriage Gift’ (which amounted to the equivalent of about AUD$7,000 at the time of payment in early 2021 (the date of payment is disputed), which the wife contends was a delay of about two years from the time of order) and that as a consequence she lost her right to conduct further searches to establish what property was owned by the husband. Again, I have no ability to determine the true position.
The husband relies upon a translation of a document dated 2 September 2020, purporting to be from the Country K property and deed register. The document sets out the following:
This is to certify that [the wife] took action for issuance of an execution writ against [Mr ATTAR] in order to obtain […] gold coins on the strength of marriage deed no. […] dated [late] 1998, executed at notary public office no. […] of [City L]. Subsequent to issuance of execution writ by the notary public office [in mid] 2020, an executive case was filed with this department under classified no. […] and the execution writ was served to the debtor [in mid] 2020. Then the debtor paid a sum of [Country K currency] 1,484,000,000 to the department's account as per slip no. […] and demanded for closing the case and issuing the certificate through letter no. […] dated [late] 2020. Moreover, pursuant to Article 98 of the Act […], the debtor is exempted from payment of execution fee. This certificate is issued at the request of the debtor to be submitted to Judiciary authorities.
(It is common ground that the reference is a reference to the husband)
The husband contends that the writ referred to in the document relates to the proceedings commenced by the wife for payment of the ‘Marriage Gift’ and that it issued in mid-2020 and was served on the husband in mid-2020 and that the ‘Marriage Gift’ was paid in late 2020. Accordingly, the husband submits that the wife’s claim she could not search the land title registry unless she had proceedings on foot in Country K is demonstrably incorrect, given that she admits she was able to cause a search to be conducted in January 2019, more than a year prior to the commencement of her proceedings in Country K.
The wife disputes the authenticity of the document set out above, and in particular she disagrees with the dates referenced in the document. I have no way of resolving this issue.
One would have thought that either party could have produced further evidence relevant to this issue e.g. the wife could have produced evidence from her lawyer in Country K to confirm the date she commenced proceedings in Country K and any impediment to a woman conducting land registry searches, and the husband, one would have thought, could have undertaken a name search of the land title registry evidencing any property in his name in Country K. The husband lived in Country K until late 2022.
If it be the case that the husband does not own the X Region land, it was not satisfactorily explained, by the husband, why he held, at least at one time, the title deed. If it be the case that the husband has no interest in the house in City BB, one can only wonder why he paid for renovations to it as alleged by the wife and not denied by the husband in his reply affidavit.
I am left with an unsatisfactory situation where, other than the husband’s own assertion in the 26 May 2013 letter that he owned or held an interest in the various properties, there is no corroboratory evidence that he in fact owned or owns the disputed properties.
The husband claimed, during oral evidence, that the various properties referred to in the 26 May 2013 letter were still registered in his parent’s names, although they are both deceased. The properties, he said, form part of his parents’ estate, and the husband ultimately conceded that he may have an interest in some of the properties. The husband also conceded that his brother in Country K, his brother in the United States of America and his sister in Australia could have given evidence relevant to this issue of possible inheritance. There was no explanation for the absence of evidence from his siblings on this important matter.
I must say, the explanations provided by the husband surrounding his assertions of ownership of various properties in Country K in the letter dated 26 May 2013 is most unsatisfactory. While he claims that the letter represented his “predictions” of what he might own, the letter itself says no such thing. The disputed nature of the husband’s legal and equitable interests in property was very much an issue in these proceedings. Indeed, it is the first task that the Court must undertake i.e. to identify each party’s legal and equitable interests in property. As already noted, the husband had a duty to the Court, to make full and frank disclosure of all information relevant to a proceeding in a timely manner. In my view, the husband has failed to comply with that duty.
The husband also claimed for the first time during cross-examination that he had owned and sold a property in Australia prior to his marriage to the wife. There is nothing in his evidence in chief that makes this claim. The husband refers to having had “savings” at the time of marriage but does not say how much he had or that the savings were sourced from a property he had sold in Australia. If the husband had owned a property in Australia, as alleged, one might have thought his claim could have been easily corroborated by an historical land registry search. Elsewhere in his evidence in chief, the husband refers to having saved money over a very long time in order to contribute to the purchase of the former matrimonial home in 2017. Again, there is no mention of a previous home in Australia that had been sold and was a source for his savings, even in part, when the former matrimonial home was purchased.
The wife submits that the consequence for the husband of failing in his duty of disclosure is that the Court may take a more “robust” approach in the ultimate determination of what is a just and equitable property division. The wife relied on the authorities of Black & Kellner[10] and Weir & Weir[11] in support of this submission.
[10] (1992) FLC 92–287.
[11] (1993) FLC 92–338.
Black & Kellner involved a case where it was found that the husband had lied about his income which in turn meant that his business was likely to be substantially undervalued. The consequence of these failures of disclosure meant that the Court was unable to identify the asset pool in full, and accordingly, the Full Court held that the discretion of the trial judge did not miscarry in the assessment of what was a just and equitable outcome. Indeed the Full Court observed that they would have awarded the husband less than the trial judge.
Weir & Weir involved a case where the husband had failed to satisfactorily explain a discrepancy in his business accounts of about $153,000, and coupled with evidence that he had regularly been observed ‘pocketing’ cash from the business rather than banking it, the Full Court held that a “broad brush” approach was warranted and determined that $100,000 should be treated as monies already received by the husband from the property pool. In coming to that conclusion, the Full Court said:
We appreciate that this is something of a broad brush approach, but, as we have said, where there is clear evidence of non-disclosure as there was here, the Court should not be unduly cautious about making findings in favour of the other party. It has been said by one commentator (O'Ryan and Broadfoot, 5th National Family Law Conference Handbook, p 249) the failure to disclose undermines the whole process of adjudication of proceedings for a settlement of property in that the court is unable to identify the property of the parties, to properly assess contribution, or to properly assess s 75(2) factors.
In this case, I am unable to find as a fact that the husband has a legal and equitable interest in any of the disputed property in Country K (I deal separately with the City L apartment later in these reasons). It seems to me that it is nevertheless open to take into account as a s 75(2)(o) factor the following matters:
(a)The husband’s admission that he has a possible interest in at least some of the properties mentioned by him in the 26 May 2013 letter;
(b)The husband’s admission that he had possession of the title deed for the X Region land, at least at some point and failed to explain why that would be so if he did not have an interest in the land;
(c)My finding that the husband paid for renovations to the house at City BB; and
(d)The failure by the husband to call evidence from his siblings relevant to the issue of his potential inheritance and ownership of the disputed property in Country K.
I reject the husband’s evidence that he had savings at the time of the marriage sourced from the sale of a property in Australia and that these proceeds, or part thereof, were then used to contribute to the purchase of the former matrimonial home.
How these matters are taken into account will of necessity attract a “broad brush approach”.
WHETHER THE PROPERTY SITUATED IN T REGION, CITY L (“THE CITY L APARTMENT”) SHOULD BE INCLUDED IN THE PROPERTY POOL FOR DIVISION BETWEEN THE PARTIES?
It is common ground that the City L apartment was owned by the husband either from the date of marriage or shortly thereafter, until at least early 2016. The parties lived in the apartment from about 2000 to 2007 and when visiting Country K in 2009 and again in 2012. The husband has lived in the unit at various times since then. In particular, the husband left Australia for Country K in early 2016, returned to Australia in late 2016 and left again for Country K a short time later. He did not return to Australia until about early 2017. The husband left Australia again in 2018. It is unclear when he returned to Australia, but he contends he was unable to leave Country K between 2019 and 2021 and elsewhere in his evidence in chief he contends that the “relocated” to Country K in 2020. The husband returned to Australia in early 2022. It is unclear if he again returned to Country K in 2022, but it seems he has lived in Australia since about late 2022.
It is also common ground that at least as at early 2019, the apartment was registered in the sole name of the husband and that the registered owner of the apartment was changed by the husband on or about early 2019 to record the parties’ daughter, Ms N as the registered owner. The title deed dated mid-2019 records the particulars of the owner as Ms N (it is agreed that this is the parties’ daughter), and the “ownership documentation” references a “settlement … dated [early] 2019”. The “condition content” notes “all interests of this settlement deed and cancellation right belongs to [Mr Attar] permanently and after his death transfer to the said owner of this deed”. (As earlier noted it is common ground that the reference is to ‘another name used by the husband).
The wife contends that the transfer to Ms N occurred without her knowledge or consent, and occurred as a consequence of her obtaining a protection order against the husband in early 2016. The wife contends that it was not until late 2018 that the husband told her he had transferred the apartment to Ms N, in the context of their discussing property settlement. The wife further contends that the husband did not register the transfer to Ms N until after he became aware that she had engaged a lawyer in Country K to undertake land registry titles searches in early 2019 and the transfer was then registered in early 2019. The husband contends that the timing of the registration was a mere coincidence, related solely to the fact that he “was not in [Country K] and registration takes a long time with the legal system in [Country K]”. In his reply affidavit, the husband contends that “notwithstanding that I signed the Deed transferring beneficial ownership to [Ms N] in 2016 I needed to be in [City L] to finalise the filing of the Transfer Deed (Lifetime)”. I note that the husband was in Country K from at least early 2016 to late 2016 and again from late 2016 until early 2017.
In his trial affidavit, the husband contends that in early 2016 he transferred his “legal right and title to the [City L] property to our daughter [Ms N]… and did so because of my [serious illness] diagnosis”. I note that in the husband’s trial affidavit he contends that “[i]n or about 2014 [he] contracted [a serious illness] as a consequence of contracting […].” Elsewhere in his trial affidavit the husband inconsistently contends that “[i]n 2017 I was diagnosed with [a serious illness] and [in] 2017 I was listed as a […] Transplant patient”. In his reply affidavit, the husband contends that the wife was fully aware of the transfer and that “[t]he decision was discussed and jointly made in 2015 when I found out about my [serious illness]”. If the diagnosis was made in 2014, it was certainly not proximate to the transfer in early 2016, and if the diagnosis was not until late2017, the transfer would not appear to have been related to the diagnosis. During cross-examination, the husband said he transferred the apartment to Ms N so as to avoid potential family disputes in the future about property ownership, and that he and the wife had discussed the transfer in 2015 and the decision was jointly made. The husband seemed to want to distance himself from his evidence that the transfer related to his diagnosis.
The husband does not set out any particulars of any conversation with the wife, from which it could be found that the wife consented to or even knew about the transfer. The only conversation referenced by the husband is one where he contends the wife made a bit of a joke about the transfer to their daughter, Ms N, when she said “from now whenever we want to go to [City L] and stay in unit (sic), we have to get permission from you”. The wife denies the comment and I accept her denial. Ms N was 13 years of age at the time of the transfer.
The “Transfer Deed (lifetime)” is dated early 2016, and records that in early 2016, the husband transferred the ownership of the apartment to Ms N for the price of “[Country K currency] 1,000,000” which the husband acknowledges receiving on the face of the transfer. Given that Ms N was only 13 years of age at the time it seems unlikely that she paid her father for the apartment. There is no evidence that such a payment was made. The transfer is subject to a number of terms and conditions including:
… the benefits of the object of transfer shall belong to the [the husband] during his lifetime, during which the [the husband] shall be entitled to use the property or lease it to third persons … Whenever the Transferor passes away, the object of transfer together with its entire benefits and attachments shall be transferred to [Ms N] and the heirs of the Transferor shall not have the right of claim and protest in this regard. All notarial and administrative charges and all costs of maintenance and use of the said property shall be borne by the Transferor during his lifetime. It was also provided that the Transferor shall be entitled to terminate this transfer unilaterally whenever he might wish, without any need to send notification or declaration to the other party, and taking any action in this connection shall be valid and acceptable. It was provided that the Transferee shall not be authorized to transfer the object of transfer to a third party during the lifetime of the Transferor and taking any action in violation of this condition shall result in automatic termination of this transfer.
(Emphasis added)
Even on the husband’s own evidence he has a life interest in the apartment which entitles him to the benefits of either living there or renting it out to third parties and a right to terminate the transfer of ownership to Ms N whenever he might wish. The husband explained during cross‑examination that he retained this right in case Ms N predeceased him or lost legal capacity. Indeed, in his reply affidavit the husband agrees that he “instructed Lawyers in [Country K] to prepare a Deed that included the right to rescind it”. Accordingly, while Ms N is the registered owner of the property, her rights to the property are subject to a life interest in favour of the husband, and she has no right to transfer the property to another person during the husband’s lifetime, and the husband retains the right to terminate the transfer of ownership to his daughter at any time.
The wife submits that the transfer to Ms N is a “sham” and that the husband will transfer the property back into his legal ownership after the conclusion of these proceedings. The husband denies he will do so.
To confuse matters further, the jointly appointed valuer of the apartment, Mr JJ, refers to “recent meeting minutes between [the husband] and [Ms N]” in which the husband’s “share in the Life Interest Agreement has been changed to 35 percent of the property”. The husband denies having had a meeting with Ms N, denies having a 35 percent interest in the apartment, and denies telling Mr JJ any such thing.
I find that the transfer to Ms N occurred in the context of the troubles then experienced by the parties in their marriage, evidenced by the wife obtaining a protection order against the husband in February 2016. I reject the husband’s contention that the wife knew about the transfer in 2016 or that she consented to it. I accept her evidence that she first became aware of the transfer during the conversation with the husband in December 2018. I reject the husband’s evidence that it was a mere coincidence that he registered the transfer in early 2019. The husband had had ample opportunity to register the transfer prior to that time. The husband registered the transfer in the hope that he could prevent it being taken into account in these proceedings.
In any event, in circumstances where the husband retains the right to terminate the transfer of ownership to Ms N at any time, the apartment should be treated for the purposes of these proceedings as property of the husband’s. The husband controls the ownership of the apartment. Ms N will not benefit from the apartment unless she remains the owner at the date of the husband’s death.
If I am wrong in that conclusion, I would nevertheless notionally add back the City L apartment into the balance sheet as property of the husband’s because of the husband’s premature disposal of the apartment which would otherwise have been included in the balance sheet.[12]
[12] In the Marriage of Townsend and Townsend (1995) FLC 92–569.
WHAT VALUE SHOULD BE ATTRIBUTED TO THE CITY L APARTMENT?
The parties jointly appointed a single expert to value the City L apartment. Mr JJ valued the apartment at AUD$563,492.
The husband included the single expert’s affidavit in his list of documents relied upon, and the translation of that affidavit and the annexed report was relied upon by the wife without objection. On the second day of trial, the husband, for the first time, gave notice that he intended to object to the affidavit. Ultimately, the husband did not object to Mr JJ’s evidence but a submission was made that, as the report failed to comply with certain provisions of r 7.22 of the Rules, the report should not be afforded much weight.[13] No submissions were made as to what weight I should place on the opinion by the single expert and ultimately, it was agreed on behalf of the husband that if I determined that the apartment should be included in the balance sheet, the value attributed to it should be that assessed by Mr JJ at AUD$563,492.
[13] Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 7.23(c).
It is true that certain formal requirements of the Rules have not been complied with by the single expert. However, I have the power to waive compliance pursuant to r 1.31. In the interests of justice, I do so. In the absence of Mr JJ’s valuation there would be no evidence of value of the apartment and that would be solely to the husband’s advantage.
The apartment will be included in the balance sheet at AUD$563,492.
WHETHER THE SUM OF $194,030 WITHDRAWN BY THE HUSBAND FROM THE JOINT ANZ ACCOUNT SHOULD BE ‘ADDED BACK’ TO THE PROPERTY POOL FOR DIVISION BETWEEN THE PARTIES?
In the balance sheet, the wife has included both $194,030 (the sum withdrawn by the husband from the joint account after separation) and $58,018 (which represents the sum paid by the husband for his legal fees), but it is conceded, on her behalf, that the legal fees form part of the greater sum and should not be included twice.
It is common ground that the sum of $58,018 should be notionally added back as against the husband.
Ultimately, the wife submitted that either the full sum should be notionally added back or only the sum agreed to i.e. the $58,018 i.e. it was not submitted that I should attempt to assess what sum might reasonably have been used by the husband on his living expenses, and only notionally add back the difference.
The husband resists any amount (other than his legal fees) being notionally added back, on the basis that he used the balance to meet his living expenses. Although there are no particulars provided by the husband as to how he spent the money, it has long been accepted that parties do not go into a “state of suspended economic animation”[14] upon separation. Having regard to the husband’s history of modest income even when operating his business after separation, which was severely impacted during the Covid-19 pandemic, and the deterioration in his health requiring a transplant months ago, it is not unreasonable for some of the money to have been expended on living expenses. It is now five years since separation. Spending $136,012 over that period, which equates to about $520 per week (in addition to his modest income from his business), is unremarkable.
[14] M & M [1998] FamCA 42 (Full Court).
Accordingly, I will notionally add back only the $58,018 spent by the husband on legal fees.
WHAT VALUE SHOULD BE ASCRIBED TO THE PROPERTY AT B STREET, CITY C?
The parties appointed a single expert from a panel of experts submitted by the husband to the wife. The value attributed to the former matrimonial home by Mr LL, the single expert, is $2,200,000.
The husband contends that I should ascribe a value of $2,600,000 to the property because the husband’s “view was the property had a value of between 2.6 and three million dollars”. It is accepted on behalf of the husband that the husband’s “view” is not evidence I can rely upon. However, it is submitted that the Court is “not bound just by the expert witness either” and that there is “a problem with his methodology. He has not compared horses for courses. He has compared oranges and lemons”.
The husband had sought to adduce evidence from an adversarial expert but his application was dismissed on 2 May 2023 for the reasons provided on 5 May 2023.[15]
[15] Attar & Melidis [2023] FedCFamC1F 342.
Mr LL is a very experienced registered valuer, having undertaken an appropriate course of study at KK University and having prepared “thousands and thousands” of valuations over his career, in particular in the Suburb F area in which the former matrimonial home is situated. Mr LL has an unrestricted licence in Queensland with all the major banks to value any property of any value. I am comfortably satisfied that he is an appropriately qualified expert to express an opinion on the value of the property.
The direct comparison methodology adopted by Mr LL is explained by him in his report as follows:
The Direct Comparison Method compares multiple sold properties against the subject property in the same way a potential purchaser would. The analysis of the comparable sales makes allowances for such factors as date of sale, sale terms and conditions, location, discernible differences between the properties and other pertinent factors, to assist in my estimation of market value.
Mr LL listed and described six properties in applying his methodology of valuation. One of those properties, at MM Street, Suburb NN, was included in error as he recently became aware that it may have involved related parties. Of the remaining five properties, Mr LL opined, in summary:
(a)OO Street, Suburb NN sold for $1,750,000 in 2022 and while a larger block with a wider frontage and superior view, it was overall inferior because of its location on a busy street, the dwelling (at the time of inspection) was of inferior quality, had inferior ancillary improvements and inferior car accommodation;
(b)1 PP Street Suburb NN sold for $2,200,000 in 2022 and while the dwelling was fully renovated “on trend” and of superior quality with a comparable view, it was considered overall similar because it had a similar constrained canal front position and inferior suburb location;
(c)QQ Street, City C sold for $2,225,000 in 2022, and while it was on a larger block in a similar location with restricted canal front position with similar view and aspect, the dwelling was older, slightly larger but of inferior quality but with superior ancillary improvements and considered overall slightly superior;
(d)RR Street City C sold for $2,300,000 in 2022 and while it was a similar size block in a similar location but with an older dwelling, it was considered overall superior because of superior water views and a nearly 19 metre frontage to the canal;
(e)2 PP Street, Suburb NN sold for $2,990,000 in 2022 and while it was a slightly smaller block in an inferior location, it had superior canal front position and superior view with a superior quality dwelling “on trend” and superior ancillary improvements and was considered overall superior.
In responding to the challenges to the use of these properties as comparable, Mr LL explained:
(a)While only one of the properties was in Suburb F itself, there are a number of prime waterfront suburbs in the D Region including, at City C e.g. Suburb F, Suburb SS, and others such as Suburb NN;
(b)The subject property is a “reverse battle axe allotment” with a “narrow finger to the water” and at “[only a few] metres of frontage, that’s about as narrow as water frontage gets”;
(c)“My experience in valuing beach and waterfront properties over many years is that frontage is crucially important to value”;
(d)At the time of valuation, there had been very few relevant sales within Suburb F itself and accordingly, sales were included in “areas that are somewhat similar, within a reasonable proximity … and on blocks of land which had narrow canal frontages”;
(e)The narrow canal frontage “would restrict significantly the size of the boat you could accommodate”;
(f)Other sales Mr LL was asked about during cross-examination were not considered comparable because they had significantly greater canal frontage e.g. 20 metres as opposed to the few metres of the subject property;
(g)“We have had three and a half per cent of interest rate rises which has considerably slowed the market and changed consumer behaviour”;
(h)The valuation is correct “based on my opinion and the best sales evidence I could establish on the date of valuation”; and
(i)“You must be careful when you’re comparing constrained waterfront sites with full width waterfront sites. … That, in my opinion, creates a danger because you are not valuing the property with similar land holdings”.
I accept Mr LL’s opinion as to the value of the former matrimonial home at $2,200,000.
WHAT VALUE SHOULD BE ASCRIBED TO THE FURNITURE AND SPECIALIST ITEMS IN COUNTRY K?
There is a dispute about whether or not the valuation for the furniture and specialist items and Country K was one undertaken jointly. The husband contends that it was and that the valuation of AUD$2,840 should be adopted.
The wife takes issue with the valuation as she contends it was not a joint valuation but obtained by the husband alone. The wife contends that I should attribute the same value to the furniture and specialist items in Country K as that attributed to the furniture and specialist items in Australia. Counsel for the wife appropriately conceded that such a submission was weak.
The only evidence I have of the value is AUD$2,840, which is what I will adopt.
However, I propose to take into account in a “broad brush approach”, the husband’s failure to comply with the trial directions in relation to obtaining a joint valuation for these items.
The husband failed to include the furniture and specialist items in Country K in the balance sheet submitted by him to the wife on 21 December 2022, pursuant to the order made on 29 November 2022, despite this being an issue between the parties throughout the proceedings. The wife submitted an amended balance sheet to the husband on 11 January 2023 nominating a value of $30,000 for the furniture and specialist items in Country K. The husband failed to nominate a panel of experts to value the items within seven days (or at all) as required by the trial directions. It was not until 30 January 2023 that the husband took issue with the wife’s value. The wife suggested that the husband nominate a panel so that a joint letter of instructions could be sent to an agreed valuer by early 2023. At no time did the husband provide a panel and at no time was a joint letter of instruction provided to the valuer. The husband also failed to provide to the wife a copy of any written instructions provided by him to the valuer who ultimately undertook the valuation of the furniture and specialist items, which the wife contends fails to include valuable items.
WHAT VALUE SHOULD BE ASCRIBED TO THE WIFE’S JEWELLERY IN AUSTRALIA?
Ultimately, no submissions were made that any value should be attributed to the wife’s jewellery in Australia.
HOW SHOULD EACH OF THE PARTIES’ CONTRIBUTIONS BE ASSESSED, NOTING EACH PARTY DEPOSES TO MAKING GREATER CONTRIBUTIONS THAN THE OTHER, PARTICULARLY DURING THE RELATIONSHIP, INCLUDING FINANCIAL AND NON-FINANCIAL CONTRIBUTIONS?
It is not in dispute that the husband acquired the City L apartment, which was completed by an uncertain date but either prior to 2000 (according to the husband) or in 2000 (according to the wife), when the parties commenced to live there. In mid-1998, a half interest in the land on which the apartment block was built was transferred to the husband. It is not entirely clear when the husband became the sole owner of the apartment, but the wife concedes the apartment was a contribution made by the husband.
Prior to moving into the unit, the parties lived in a rental property that the husband had been living in before the parties’ marriage. The husband also had some furniture, a car and some savings (although the amount of savings is not identified). The husband operated his own business, called ‘W Business’. The wife contends that she assisted in the operation of the business, in particular by paying for some of the expenses associated with its operation, particularly after 2003.
The wife had negligible assets at the date of marriage, although she was a qualified health professional. The wife worked as a health professional in 1998 while undertaking specialist training, which she completed in 2000 and graduated in early 2001. The wife was employed in Country K in her field of specialty until shortly prior to the parties’ relocation to Australia. The wife also bore two children during this time, in 1999 and 2003 respectively. The wife worked throughout her pregnancies and returned to work as soon as she was able to do so.
The parties employed domestic assistance but both parties were involved in the care of the children, although the wife denies that the husband’s contribution to the care of the children was significant.
While the husband contends that the wife’s income was modest until 2003, he concedes that by 2003 the wife and he were both contributing financially to the family. The wife contends that she was largely supporting the family from 2003, other than for the payment of rent and the provision of a home when they were living in the husband’s apartment. The husband contends that by 2003, he had “accumulated approximately AUD$500,000 which he held in a term deposit … in Australia.” It is not apparent how the husband was able to accumulate savings in this sum when he was also, according to him, providing solely for the family until 2003. During cross-examination the husband asserted that he “had a house before I married her … I got my … money from that house which I sold in the [D Region] before I marry her”. As previously noted at [58] of these reasons, this claim by the husband was first raised in cross‑examination and there is no corroboration.
The wife contends that after the parties moved to Australia in 2007, the husband operated his business from home and that she assisted him e.g. by providing advice and also by helping the husband’s clients. The husband does not deny this in his reply affidavit. The Australian business involved recruitment. The husband’s income was generated from clients and organisations.
The wife obtained accreditation for her Country K qualifications in Australia through a program which she successfully completed by 2009/2010. The husband assisted the wife in this process. After completing this program, the wife undertook unpaid observation work at the Q Centre. In 2011, the wife obtained a position as a health professional. In 2015, the family relocated back to D Region where the wife worked as a health professional at the Q Centre commencing in early 2016. The wife worked twelve hour days four days per week. The husband concedes that, at least from this time, the wife’s income “far exceeded” what he was able to earn from his business. The children attended a private school on a half scholarship. The fees of about $12,000 per annum were paid by the wife.
The wife’s income for the period 2012 to 2021 is set out in the table below:
Year Gross income Net income after tax 2012 $117,795 $83,893 2013 $104,236 $74,582 2014 $64,867 $51,095 2015 $54,832 $43,558 2016 $239,671 $150,631 2017 $442,324 $270,046 2018 $535,506 $321,297 2019 $487,127 $294,822 2020 $546,565 $327,514 2021 $508,862 $309,207 Total $3,101,785.00 $1,926,645.00
The only evidence of the husband’s income is as follows:
Year Gross income for O Pty Ltd Profit before tax Taxable income 2021 $26,833 $9,509 $0.00 Individual income 2015 $25,661 2016 $18,179 2017 $9,943 2021 $4,854 Total $9,509 $58,637.00
It is likely that the husband received some income from his business during the period 2012 to 2015 and that certain tax deductions for operating a business from home benefited the parties.
The husband’s company paid no tax in the 2021 financial year as he was able to carry forward losses from 2015-2016 income years of $57,110. Since the Covid-19 pandemic the husband’s business has collapsed and is providing very little, if any, income.
During the marriage the husband was self-employed and it is not in dispute that he paid the rent for the parties’ accommodation for the initial period of their marriage, before they moved into the City L apartment in which they lived until relocating to Australia in early 2007.
The husband contends that he received an inheritance of $95,000 which he contributed to the welfare of the family. In the absence of any corroboration, and in light of his unsatisfactory evidence about inheritances from his parents generally, I place little weight on this alleged contribution.
Both parties were involved in caring for the children, although the husband travelled extensively for his work, with the wife contending that after their move to Australia in 2007 the husband spent at least six months a year living in the City L apartment. The husband concedes he travelled extensively for work but contends he was “in [Country K] for the purposes of running, operating and maintaining” his business for 35 to 40 percent of the year. The husband contends that the wife had the assistance of her parents during at least some of his absences and that on one occasion he had one of his staff assist the wife while he was absent. It is reasonable to accept that the wife bore a greater responsibility for the care of the children than the husband during the husband’s frequent and extended absences.
It is not in dispute that after the parties moved to Australia in 2007, and until they purchased the former matrimonial home in early 2017, the husband paid the rent for their accommodation. The former matrimonial home was purchased for $1,860,000. The wife paid the initial deposit of $180,000. The husband paid about $600,000 from an account or accounts in his sole name. The husband denies that this sum was accumulated during the marriage and should therefore be regarded as joint savings, as submitted by the wife. The husband concedes however that his savings “had accumulated over a very long period of time”.
The former matrimonial home is registered in the joint names of the husband and wife in the proportion 35 per cent to the husband and 65 per cent to the wife. It is common ground that the wife insisted upon the title reflecting the different proportions. The wife contends that she insisted on the different proportions because she had been largely supporting the family for years, other than the payment of rent, and that it was fair because the husband had other properties in Country K. The husband disputes these were the reasons. The husband denies that he only paid the rent and contends that he also paid other expenses and as his business was operated from home he received tax deductions which benefited the family.
It is common ground that during the period 2007 to 2011 the family received Centrelink payments of about $900 per fortnight and that they also received rental assistance. The wife did not receive an income from employment during this period.
It is also common ground that the wife has paid the mortgage, rates and insurance for the former matrimonial home since its acquisition. The total mortgage payments made from early 2017 to late 2021 were $254,166. The current mortgage repayments are $1,586 per week and the rates are $115 per week.
At least from 2015, the husband’s income from his business was modest. It seems more likely that from 2011 the wife’s income significantly exceeded the husband’s.
After separation, the children remained with the mother. Ms M was 17 years of age and Ms N was 13 years of age. The husband made a modest contribution to the children’s support after separation.
While the wife has continued to live in the former matrimonial home since separation she has met all of the outgoings.
In my view, the myriad of contributions made by each of the parties over their 19 year marriage should be assessed as largely equal, as submitted on behalf of the wife.
SECTION 75(2) FACTORS
There are a range of matters that are required to be taken into account pursuant to s 75(2).
It is common ground that even if the husband has an earning capacity, it is modest. The husband recently underwent a transplant and takes up to 17 medications daily. He also suffers from diabetes. The husband’s business was badly affected by the Covid-19 pandemic and it seems unlikely that he will be able to resume operations in the foreseeable future.
The wife has a significant earning capacity by comparison. She is also ten years younger than the husband and is likely to have the capacity to continue working for a considerable time, although I note that she suffers from an autoimmune disease and that seems to have caused her to reduce her working hours to some degree.
The wife has at least a moral obligation to assist in the children’s support which she is meeting by paying their expenses of $775 per week.
The husband’s failure to comply with his duty to provide full and frank disclosure of all information and documents relevant to an issue in the proceedings has made it impossible to identify with confidence the extent of his legal and equitable interest in various properties in Country K. In 2013, the husband asserted full ownership in a property in X Region and he had possession of the title deed for that property both in Country K and in Australia. The husband also asserted a half interest in another four properties in Country K. One of those properties is a home to which he contributed funds for renovations. At the very least, the husband concedes that there are a number of properties in Country K in which he may have an interest.
The husband failed to call evidence from his siblings relevant to the husband’s potential inheritance and ownership of the disputed property in Country K.
The husband failed to comply with the trial directions in relation to the valuation of the furniture and specialist items in Country K and as a consequence the wife lost the opportunity to have all of the items valued.
I conclude that there are s 75(2) factors which favour each party in this matter and I accept the submission made on behalf of the wife that the various factors effectively cancel each other out so that there should be no adjustment to either party.
DISPOSITION
To achieve a just and equitable outcome, the property of the parties, or either of them, will be distributed as set out in the balance sheet below. To achieve equality, the wife will be required to pay the husband the sum of $388,245.
The wife wishes to retain the former matrimonial home and has the capacity to pay out the husband. In the absence of any submissions about why the home should be sold (as sought by the husband) I propose to give the wife the opportunity to retain the home. Otherwise each party will retain the property in their respective possession, name, or, in the husband’s case, any property that may be received by him from any inheritance or any re-transfer to himself of the City L apartment.
Balance Sheet
Asset To be retained by Value B Street, City C Wife $2,200,000.00 Motor Vehicle 2 Wife $25,000.00 Specialist items Wife $0.00 Jewellery Wife $0.00 Household Furniture (Australia) Wife $19,915.00 ANZ Account xx – …84 Wife $0.00 ANZ Account xx – …92 Wife $0.00 Cash at bank in Country K Wife $0.00 CBA Account xx – …91 Wife $4,531.00 CBA Account xx – …87 Wife $3,509.00 CBA Account xx – …89 Wife $403.00 ‘Marriage Gift’ Wife $3,926.00 Subtotal $2,257,284.00 Liabilities ANZ Mortgage Wife ($1,026,602.00) ATO Liability Wife ($0.00) BAS Wife ($0.00) TT credit card Credit Card Wife ($2,234.00) ($1,028,836.00) Subtotal $1,228,448.00 Superannuation Superannuation Fund 2 Accumulation Wife $308,365.00 Total $1,536,813.00 V Street, City L (the "City L Apartment") Husband $563,492.00 Other properties in Country K Husband $0.00 Motor Vehicle 1 Husband $30,000.00 Furniture and Specialist items in City L Apartment Husband $2,840.00 O Pty Ltd and W Business Husband $0.00 Westpac Account xx –…62 Husband $2,980.00 Westpac Account xx – …87 Husband $5,853.00 Westpac Account xx – …57 Husband $2,473.00 Cash at bank in Country K Husband $0.00 Notional add back legal fees Husband $58,018 Subtotal $665,656.00 Superannuation Superannuation Fund 1 Accumulation Husband $94,668.00 Total $760,324.00
To achieve equality, the wife will be required to pay the husband the sum of $388,245 and the wife will have 60 days to do so.
MISCELLANEOUS
Stay application
On the first day of trial, the husband was granted leave, without objection to further amend his Initiating Application to include the following order:
2. That pursuant to S45 of the Family Law Act 1975 this Honourable Court permanently stay proceedings in the Australian Court in respect of property situated in the [Country K] in [City L] described as sub lot […] of main lot […] of [City L] Registration Number […] Title Deed Reference […] as Australia is clearly the inappropriate jurisdiction to determine a division of that property.
Section 45 of the Act relevantly provides as follows:
(1)Where there are pending in a court proceedings that have been instituted under this Act and it appears to that court that other proceedings that have been so instituted in relation to the same marriage or void marriage or the same matter are pending in another court, the first‑mentioned court may stay the first‑mentioned proceedings for such time as it considers appropriate or may dismiss the proceedings.
It is not apparent on the evidence that there are any pending proceedings in another court. The only other proceeding of which I am aware, was the wife’s petition to the Family Court in Country K for the husband to pay her the ‘Marriage Gift’. It is common ground that the husband did so, and that those proceedings then concluded. There is a dispute about when the proceedings concluded, but at the latest the proceedings concluded on or about late 2020.
It was submitted on behalf of the husband, that Australia is a clearly inappropriate forum to determine the dispute in so far as it relates to the City L apartment, and that any dispute relating to that property should be determined in Country K.
The proceedings in this Court were commenced by the husband. The husband seeks a property adjustment order pursuant to s 79 of the Act. There is no doubt that this Court has the jurisdiction to determine his application in its entirety. The jurisdiction of this Court may be exercised in relation to persons or things outside Australia (s 25(2) of the Federal Circuit and Family Court of Australia Act 2021 (Cth)). Any order made by this Court pursuant to s 79 will be in personam order i.e. against the person, not in rem i.e. against the property.[16]
[16] Hickey & Hickey and Attorney-General for the Commonwealth of Australia (Intervener) (2003) FLC 93–143 at 78,389.
Accordingly, Australia is not a clearly inappropriate forum to determine the whole justiciable controversy between the husband and the wife. The husband’s application for a stay will be dismissed.
Additional orders sought by the husband
The husband includes a number of other provisions in his further amended Initiating Application, including that a number of specialist items, frames, musical instrument etc. be retained by the husband. I was not taken to any evidence in relation to such matters nor were they addressed in submissions. Accordingly, in the absence of evidence establishing that such an order would be just and equitable, I do not propose to make an order for any in specie property to be given to the husband.
Additional orders sought by wife
The wife includes a number of other provisions in her amended Response, including that she pay certain unidentified tax liabilities in her name; that the husband sign any documents necessary to release her from any guarantees and remove her as director of any entity; and that each party indemnify the other in respect of liabilities. I was not taken to any evidence in relation to such matters nor were they addressed in submissions. Accordingly, the order will not include those provisions.
I certify that the preceding one hundred and forty (140) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Carew. Associate:
Dated: 2 June 2023
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