Attridge & Haine
[2021] FCCA 1736
•5 August 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
Attridge & Haine [2021] FCCA 1736
File number(s): DGC 3837 of 2019 Judgment of: JUDGE BURCHARDT Date of judgment: 5 August 2021 Catchwords: FAMILY LAW – Property dispute – 2 young children living with de facto wife and husband in (eventually) 8-6 regime – relationship starting in 2013 and ending in 2016 (husband’s version) or 2019 (wife’s version) – husband buying former matrimonial home in 2007 and still living there – court satisfied parties in de facto relationship until 2019 within meaning of s.4AA of the Family Law Act notwithstanding toxic and turbulent relationship from 2016 - 2019 – contributions assessed 70/30 in favour of husband – wife’s future earnings always likely to very substantially less than the husband – 10 per cent adjustment to wife in respect future needs – equalisation of superannuation garnered during relationship just and equitable. Legislation: Family Law Act 1975 (Cth) Cases cited: Stanford v Stanford [2021] HCA 52
In the Marriage of, Re Mallet [1984] HCA 21
AJO v GRO (2005) FLC 93-218
Number of paragraphs: 107 Date of last submission/s: 4 June 2021 Date of hearing: 27 May 2021, 3 and 4 June 2021 Place: Dandenong The Applicant: Self-Represented Counsel for the First Respondent: Ms Goldthorp Solicitor for the Respondent: Kennedy Guy ORDERS
DGC 3837 of 2019 BETWEEN: MR ATTRIDGE
Applicant
AND: MS HAINE
Respondent
ORDER MADE BY:
JUDGE BURCHARDT
DATE OF ORDER:
5 AUGUST 2021
THE COURT ORDERS THAT:
1.The husband pay the wife the sum of $153,834 (“the payment”) on or before 4 October 2021 (“the date”).
2.In the event that the whole of the payment has not been made by the date, then the husband sign all documents and do all things necessary to transfer to the wife the real property to be held on trust for sale and that the real property be forthwith sold altogether out of Court (“the sale”) and the proceeds of the sale be applied:
(a)Firstly to pay all costs, commissions and expenses of the said trust transfer and the sale;
(b)Secondly to discharge the mortgage and any other encumbrance affecting the real property;
(c)Thirdly the balance then remaining be divided in the proportions of:
(i)65 per centum thereof to the husband
(ii)35 per centum thereof to the wife.
3.Pending the payment or completion of the sale:
(a)The husband have the sole right to occupy the real property and that during such right of occupation the husband pay all instalments pursuant to the mortgage and all rates and taxes and like apportionable outgoings of the real property as they fall due;
(b)The parties hold their respective interests in the real property upon trust pursuant to these orders;
(c)Neither party encumber the real property without the consent in writing of the other party.
4.Liberty be reserve to either party to apply with respect of the implementation of these orders move after current order 6.
5.The two rings presently in the possession of the wife be sold forthwith and the net proceeds divided 65/35 to the husband and wife.
6.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)Insurance policies remain the sole property of the beneficiary named therein;
(c)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;
(d)Any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
7.In respect of superannuation:
(a)A base amount be allocated by the Court as required by section 90XT(4) of the Family Law Act 1975, to the wife out of the husband’s interest (“the member spouse”) in the Super Fund B (“the superannuation fund”).
(b)That pursuant to section 90XT(1)(a) of the Family Law Act 1975, whenever a splittable payment becomes payable from the husband’s interest in the superannuation fund, the trustee of Super Fund B (“the trustee”) shall pay the wife an amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001, using the base amount of $101,010 and there be a corresponding reduction in the entitlement that the husband would have had in the superannuation fund but for these orders.
(c)That if, before a splittable payment becomes payable in respect of the husband’s superannuation interest, the trustee is permitted (be legislation and the Trust Deed of the superannuation fund) to make a payment to the wife (and accordingly reduce the husband’s benefit) then the trustee may make that payment (and reduce the husband’s benefit by the amount calculated by the trustee) in full satisfaction of its obligations under these orders.
(d)That the trustee shall do all such acts and things and sign all such documents as may be necessary to:
(i)Calculate, in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001, the entitlement for the wife created by order 8(a) of these orders.
(ii)Pay the entitlement whenever the trustee makes a splittable payment out of the husband’s interest in the superannuation fund; and
(iii)That the husband shall do all acts and things and sign all such documents as may be required so that in accordance with the obligations set out under the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001 the trustee of the superannuation fund can calculate the entitlement of, and make payment to, the wife in accordance with these orders.
(e)That this order binds the trustee of the Super Fund B Superannuation Fund.
8.This order have effect from the operative time and the operative time is four (4) clear business days after the service of a sealed copy of these orders on the trustee.
9.Within 14 days of the superannuation split pursuant to order 8 becoming effective, the parties, in their capacities as trustees of the superannuation fund do all necessary acts and things and sign all such documents as may be required to transfer and roll-out the whole of the wife’s member account and/or entitlement in the superannuation fund to such other superannuation fund as she shall nominate at the equal shared expense of the parties.
10.There be liberty to apply in respect of the implementation of the orders.
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment under the pseudonym Attridge & Haine is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE BURCHARDT
INTRODUCTION
This is the property component of a proceeding in which final parenting orders were made by consent on 27 May 2021. Those orders provide that the two children of the relationship, X, born in 2015, and Y, born in 2018, live primarily with the mother in a 9-5 configuration, changing in 2023 to an 8-6 regime. There is not, in fact, a lot of money to divide and each party has adopted a formal position which, in my view, grossly overstates their position.
The main primary asset of the parties is the equity in the former matrimonial home worth just over $410,000 net, of which the de facto wife seeks a payment to her of $342,544. The defacto husband (“the husband”) seeks that there be no monies paid to the de facto wife (“the wife”) at all, although he did articulate a further position in final submissions to which I shall come.
Much of the proceeding was concerned with the question of the date of separation. The wife says that the parties separated in May 2019 and the husband says they separated in August 2016, when, as is conceded, the wife sought and obtained single parent benefits.
For the reasons that follow, I find that the parties were, as is agreed, in a de facto relationship from March 2013 until August 2016. Thereafter, their relationship continued on an on-again-off-again basis with multiple short separations through to final separation in 2019. In my view, the just and equitable outcome of this matter is that the wife should receive 35 per cent of the property pool and the husband 65 per cent, with an equalisation of superannuation garnered during the relationship.
AGREED AND UNCONROVERSIAL MATTERS
The husband was born in 1970 and the wife was born in 1984. They commenced in a relationship in 2013 and became engaged in 2014, although they never married. X and Y, as indicated, followed in 2015 and 2018 respectively.
The husband has two other children, Ms C, born in 2001, and D, born in 2003, who obviously lived with the parties while they were together at least until 2016.
The husband is employed as a professional and receives a salary of $250,000, inclusive of superannuation, and is eligible for bonuses of up to 30 per cent of salary if he makes budget. He has not yet met his KPIs and received any such bonus.
The wife is self-employed. She describes various activities but I think in principle, she seeks to be an allied health worker, something she is in the process of studying and, as I understand it, will complete in 2023. In the year 2020, which appears to have been the first year of practice, she earned $38,000 in this activity. She also describes herself as a health care worker and deposes to certain other activities such as allied health.
When the parties first met, the husband already owned the former matrimonial home at E Street, Suburb F, which appears to have been bought in 2007 for $365,000. He still owns and lives in that property.
The wife had a part share in a property in Suburb G which she continues to own but which is of very little value. She also owned a property in H Street, Suburb J. That property was sold in June 2015 and it cleared $262,000, of which $62,000 was applied to debt and living expenses. Of the remaining $200,000, some was advanced to enable the husband to buy a new boat, a matter to which it would be necessary to return, and relevantly for these purposes, $142,000 was applied to the mortgage. It is clear that in October 2015, that $142,000 was transferred to another account, but each party maintains that the other one received those funds.
The husband has been fully employed effectively throughout the entire relationship. The wife was working as a professional until 2014 when she bought a business. This was done in part with the benefit of $90,000 advanced to her by her father. The business was not a successful venture and was sold in mid-2016. The $20,000 sale price was simply applied to meet debts.
The husband has owned other properties from time-to-time including one at Suburb K which was sold as a loss. It will be necessary to return to that matter also.
In 2015, the husband bought a new boat (his affidavit says 2017 but annexure 23 to his affidavit filed 28 May 2021 clearly shows 2015). That shows that $29,000 was advanced, out of the net $200,000 proceeds of sale of H Street, Suburb J. It appears that there was a trade-in on his previous boat of $25,000 and that the total price of the new one was therefore $54,900.
THE PARTIES’ AFFIDAVITS
Much of what was contained in the parties’ voluminous affidavit material is canvassed in the agreed matters above. I have, of course, read the entirety of the parties’ affidavits but would simply refer to some additional matters of note.
In her first affidavit filed 28 January 2020, the wife referred to cohabitation from 2013 to October 2018 at E Street, Suburb F. She deposed that they then moved to Sydney for the husband’s work but she returned in January 2019 to E Street, Suburb F with the children. She then deposed to final separation in May 2019. Her affidavit noted that the husband had taken out an Intervention Order against the wife on 21 January 2020.
The wife went on to depose that after X’s birth, she went back to work at her business after four weeks. She deposed to an Intervention Order taken out against the husband on 11 December 2019.
In his affidavit filed 23 March 2020, the husband deposed that he bought the E Street, Suburb F property for $365,000 in 2007 with a loan for the same amount. The mortgage had gone up to $467,000. He deposed to the purchase of the property at Suburb K for $650,000 in June 2018 and its sale in November 2019 for the same price but leaving a $91,000 debt. The husband deposed that he had $100,000 savings at the start of the relationship and $200,000 in superannuation.
The husband went on to depose that he had paid the wife’s ex-fiancé, Mr L, $40,000 in 2013, $40,000 towards the business in 2014, $36,000 towards business renovation in 2015, and a further $10,000 for business expenses in 2016. He went on to detail losses of $140,000 in cryptocurrency trading between October and December 2017. He deposed to purchasing an engagement ring for the wife for $60,000 in 2015 and an eternity ring for $15,000 in 2016 and deposed that these have both increased in value. He described the relationship between 2015 and May 2019 as being friends with benefits.
In his outline of case filed 24 May 2021 (bearing in mind that the applicant is self-represented, it is appropriate to have regard to this document), the husband relevantly asserted:
“In 2015 the applicant sells her H Street, Suburb J property. The proceeds of sale were $262,000 which was paid into the applicant personal account. Of this money $142,000 was paid to the mortgage secure ending …21) and was then withdrawn in October 2015 and paid back the applicant.”
The outline of case also asserted:
“Over the course of the relationship the respondent loans the applicant $230k for various business ventures with a verbal agreement the funds would be paid back to the respondent on a success of business ventures.”
In his affidavit filed contemporaneously on 24 May 2021, the husband deposed to a prior joint valuation of the matrimonial property and his opposition to a later valuation undertaken by M Valuers on behalf of the wife. He complained of the lack of disclosure on the wife’s part. He also deposed to having purchased engagement rings with a combined value of $84,000 which he wanted returned.
The wife’s trial affidavit filed 24 May 2021 deposed, as earlier indicated, to her completing her studies in 2023. She deposed as to the parties’ present superannuation holdings. She confirmed that the husband paid $27,000 to her ex-partner and discharged $11,382 in debt then owed by her. She deposed that the husband’s superannuation, at the commencement of the relationship, was $166,081, whereas her own was $28,575 (both figures supported by superannuation statements).
Otherwise, the matters deposed to are essentially already repeated in the agreed matters above. The wife has sought an addback of $56,091 in respect of the sale of Suburb K less $5,021 already advanced to her. She deposed having about $20,000 in superannuation at the commencement of the relationship.
Finally, the affidavit of the husband filed 28 May 2021 deposed to the lease of his motor vehicle 1. It deposed to the fact that the wife had been in receipt of single parenting benefit since August 2016. He repeated at paragraph 13, an assertion that the $142,000 was advanced to the wife on 23 October 2015 into an account …34.
The wife’s final affidavit filed 1 June 2015 deposed to an extremely tumultuous relationship. She agreed that the jewellery be sold and that the proceeds be divided between the parties. She deposed to not knowing whose the account number …34 was.
THE EVIDENCE GIVEN AND SUBMISSIONS
What follows is taken from my notes. Self-evidently, it is not a transcript but records aspects of the matters that struck me as being significant.
Following some preliminary arguments as to whether the husband should be allowed to call his adult daughter as a witness when she was not on affidavit, which I resolved at the time, the husband made an opening.
THE OPENING AND EVIDENCE OF THE HUSBAND
The husband said that the parties always had separate assets. The relationship ended in 2016 and he sought orders dismissing the wife’s application. The relationship ended in late 2016, and although there was some cohabitation under one roof, there was no intimacy. No assets were purchased thereafter and there were no shared finances. The wife left for periods of time. There were attempts to reconcile after 2016 but they did not succeed. It was a toxic relationship. A number of the wife’s statements were untrue.
The husband was called and adopted his affidavits as true and correct.
Under cross-examination, the husband said it was a toxic relationship from 2016 onwards. There was cohabitation under one roof at times. It was put to him that he admitted there was mutual family violence and he readily agreed. He admitted choking the wife on one occasion. He also readily conceded that he had head-butted her. He said that she had moved out but he could not say where. She stayed with her mother at times. Sometimes she left the children with him. He was aware that the wife maintained that final separation took place in June 2019. He agreed that she had left her possessions in the home when she went.
The husband was cross-examined about living in Sydney in 2018. He denied that it was for a period of five months. He was there for work and staying in an apartment. He returned to Melbourne on weekends. He conceded that the wife was in Sydney from October to January 2019. He stayed another couple of months. She went back to the family home in E Street, Suburb F. Even during the time in Sydney, it was not a relationship. There was toxic arguing every day. They could never reconcile because they were arguing every day.
The husband conceded that, in his initiating application, he had given the date of separation as May 2019. He further conceded that this was the date of separation in his first affidavit in May 2019. He agreed that he had deposed to relocating for work. He said, however, it was not a relocation. Relocation is when you move residence. He agreed, following being pressed that in his initiating application March 2020, he had also put the date of separation as May 2019. He had sought a just and equitable division of their property in that proceeding. He said he started to self-represent in about March or April 2019. His amended application had been filed by Company M. He had sought discovery. He had not sought to dismiss the application on the basis that the separation was 2016. He said he did not understand at that point what separation meant.
The husband was cross-examined about his tax returns in which he had referred to the wife as being in a relationship with him. He conceded this was in his 2018 to 2019 tax return. He said N Accountants completed this. They just copied from the previous years. This was an oversight. He would simply sign the documents and not really read through them.
The husband was cross-examined about his 2016-2017 tax return. Once again, it referred to him being in a spousal relationship with the wife. He said it was true to the best of his knowledge. It was done by N Accountants and he had not read it properly. He was not lying. A genuine relationship never existed from 2016 onwards. The tax returns were tendered as exhibit R1.
The husband conceded he was generally in full-time work during the relationship. It was always office work. It was a senior job with long hours. The wife was in office work at the start of the relationship.
It was put that they had bought a business in 2014 for the wife to work in but the husband denied this. He said they were in a relationship when the business was bought. The decision was made as a couple. It was the wife’s decision, however, to purchase the business. She had done so in a previous relationship. It was put that they had discussed the business purchase. The husband agreed but said it was not his decision. He supported it. Her father gave $90,000 towards it. He said he was not interested in running a businesses. He liaised with the business broker. A cheque in 2014 for $4,500 was tendered as exhibit R2. He had chased the matter up with the broker.
When the business was sold, he had liaised with the broker. They both agreed to sell. He denied the wife took maternity leave after both the children. He did not agree she was the primary carer. He was not available during the day but the wife was not caring for them. The wife’s part-time work did not make much money. He denied that the wife had been the primary carer since separation. The children lived with her, but there had been a 4/10 arrangement for one year and it is now a 5/9. The children were left in day-care. They were in a kid’s retreat for a time. The maternal grandmother looked after the children and then he looked after them after work. His two elder daughters also helped. It was put that the maternal grandmother assisted the family a lot. He conceded that she had the children overnight sometimes and that she had also enabled them to go on holidays without the children. This was not a significant contribution. It was a contribution.
He lived at E Street, Suburb F and the wife moved in at the start of the relationship. It was put that there was minimal equity in that property at the start but he said it was probably $300,000. When it was put to him that he had never said this before, he said he had never been asked. He was only asked to submit financials. There was no historical valuation for the matrimonial home and no mortgage documents. He conceded that there had been an order in May 2020 for a valuation. This occurred. He was not happy with the valuation. There had been a recent valuation of $750,000 and then three months later, it was $850,000.
The husband was cross-examined about his motor vehicle 1. He had completed the application for finance. It is leased and he pays it each month. Although Company O was on the forms this was just a mistake. Company O was set up in May-June 2019 but the company does not operate. He is not allowed to because he is employed. It is insured under his name, not Company O. He had intended to contract because he had lost his job because of the wife.
Exhibit R3 was the documentation relating to the vehicle.
The husband conceded that the wife’s solicitors had requested an updated property valuation in January 2021 but he had not agreed. He refused to give access to the property. He conceded receiving correspondence about this. It was put that he had refused to a joint or a separate valuation and he said yes, absolutely. He had a copy of the kerbside valuation. He has made some external improvements. He put in a pool in 2018. He did not accept the valuation of $960,000. The P Valuers valuation was over a year ago. He lives in the home and pays the mortgage.
The husband agreed with the wife’s value of her interest in the property at Suburb G of $8,032. He had a boat at the start. He agreed that his new boat was bought in part with around about $26,000 from the sale of the wife’s property. He traded it in 2015. There was $54,000 less the $25,000 trading. $29,000 was paid. He still has the boat. It was stolen last year but recovered. He received an insurance payment of $56,040. He denied having failed to disclose this. The boat was stolen from his home and he received insurance. The police got the boat back but the engine and interior had been removed. He bought what was left for $25,000.
The husband conceded he had not offered the wife any assistance. He was left with debt and no money and no job in 2019.
Having been asked further questions about the motor vehicle 1, he said there was about $13,500 owing. He was put that the wife’s motor vehicle 2 was worth $19,000 but I did not understand the husband’s answer. The wife is left with few household items and he retains a fully furnished home. He had paid $47,000 for the engagement ring, but when it was put that he had paid $15,000 for the eternity ring, he could not recall. They got engaged in 2015 with a view to commit but she had not done so. They were not a gift. He has no idea what they are valued at now but would take them at a value of $82,000. The husband confirmed that he had made one withdrawal from his superannuation on 13 August 2020 of $10,000. He had received an insurance payment when the home was broken into of approximately $22,000. He had reported the matter to police.
The husband confirmed that his income was $250,000 a year inclusive of superannuation. He can get bonuses of up to 30 per cent but he has not met his KPIs yet. He has been with his current employer since 2016.
The husband accepted the wife had sold her H Street, Suburb J property in 2016. When it was put that there was $262,000 cleared net proceeds, he said it was roughly that amount. She put in $29,000 to buy his new boat but had not put $10,000 in his name. He agreed that $142,000 had been paid into the home mortgage and that that was in his name alone. He said that the wife withdrew that a couple of months later. He agreed that he was the sole controller of the account. The BSB of the account to which it had been sent is Q Street, Suburb R, which is where her business was.
The husband confirmed that he has two elder daughters. They were staying alternate weekends and then in 2016, it became week about. The wife had assisted with them.
The husband said that he pays $1,900 per month in Child Support for the children but nothing for the wife. He does not pay kinder or school fees but he was prepared to pay 50 per cent of X’s school fees going forward. He pays the children’s health insurance but he had taken the wife off the insurance. He admitted telling her that she should get this herself as she had a boyfriend working at S Insurance.
The husband agreed that in May 2019 he had refinanced the mortgage to an extra $39,000. He paid out credit card bills. The wife had a secondary card, ANZ Visa. There was also a CBA card credit debt which should be included in the pool. He had sold Suburb K property in November 2018 and had only had the property for a year. In July-August 2019 (the prior reference to 2018 was, I think, an error) the tenants had not paid rent. They then did substantial damage before they left. It was a shortfall on the sale which did not cover the mortgage. He had also had to institute repairs. The loan was secured over the E Street, Suburb F property.
The spend time regime is 5/9. It will be 8/6 when the youngest is in prep. The wife’s income was $38,000 in the last 12 months. He earns $130,000 after tax. After Child Support of $25,000, he has $105,000 left. $38,000 is not the wife’s true income. She has not provided profit and loss or balance sheets. He did not agree that she had complied with the subpoena. There were no profit and loss statements.
It was put that the wife had applied for Centrelink single parent pension and he agreed. He was not aware of the pension after 2016. He was going to call Mr T in this regard. He then said he was aware she received a single parent pension. It was put into her NAB account. He did not have access to this nor did he use the money. He was aware she was entitled to Centrelink benefits because she had children but he was not involved.
Counsel traversed offers that the husband had made to settle the matter to the wife that were contained in his affidavits. He conceded this but said she was not entitled to settlement. He had made an offer in July 2020. At that time, he did not know what a de facto relationship was. He had only found out in the last month or so. He did not accept that she should get any superannuation from him. It was not fair and equitable to divide the superannuation gained during the relationship. She was getting $1,000 per fortnight from Centrelink.
There was no re-examination.
THE EVIDENCE OF MR U
Mr U was called, interposed by agreement. He is a property valuer and the Managing Director of M Valuers. He adopted his report of 19 May 2021 as correct.
Under cross-examination by the father, Mr U confirmed that a kerbside valuation is not as good as a full valuation. Internal inspection is preferred. The method of valuations vary. Residential is direct comparison. There are two ways of doing it. There is approved value or summation. He had no internal access to the comparative properties but did have photographs of them. Comparative properties were important. He was aware of the P Valuers report. He did not use their comparative properties as they were a year old. He had got the P Valuers report to get details that he could not get from inspection. There was some uncertainty as a result of COVID-19, but the most recent May 2021 comparators are what he had adopted.
This paraphrase is by no means complete but gives perhaps the flavour of Mr U’s report. I would make it clear at this point that Mr U struck me as an extremely experienced and competent gentleman in his field and he impressed me as being devoid of partiality.
THE EVIDENCE OF MR T
It shall be noted that Mr T was called after I had ruled against the calling of Ms C, the husband’s older child for the reasons I then gave. Mr T adopted as his evidence a statement annexed as annexure 11 to the husband’s affidavit filed 25 May 2021. In this, he had said that the wife had approached him around July-August 2016 and asked him to act as witness on her verification of relationship status for the purpose of claiming single parenting allowance. The statement goes on to say:
“Ms Haine advised her relationship with her partner Mr Attridge had broken down as she was moving back to her mum’s house.”
He said that Ms Haine asked him to witness a Centrelink form to verify her relationship statement and to make a declaration that she was single and living with her mother which he had done. The balance of the statement is to the like effect.
Under cross-examination, Mr T admitted that he was a friend of the husband’s and that they work together. They had been friends for some eight to nine years. Ms Haine asked him to sign. He had received some texts from her. He called her and asked how she was going. She had said she was living with her mum. Centrelink called him. That were separated. He could not give the exact timeframe. He had subsequently attended birthday parties. He went to X’s first birthday in 2016 which was hosted together by her parents. He had attended all the birthday parties and they were all at E Street, Suburb F. There were arguments during these parties. He was adamant, despite being pressed, that it was the wife who requested him to fill out the Centrelink form.
In re-examination, Mr T said that at the time he signed the form, the wife said she had separated and was moving into her mum’s place and was going to get Centrelink.
THE OPENING AND EVIDENCE OF THE WIFE
Counsel opened in some detail. She pointed to the wife’s work as an allied health worker and the fledging nature of this business with an income of $38,000 in 2020 and contrasted this with the husband’s salary of $250,000, inclusive of super, and bonuses. Counsel noted that the relationship commenced in 2013 and that disputation that the final separation was May 2019 had only been raised for the first time in Court the previous Thursday (when the parties dealt with parenting issues). Counsel submitted it was a tumultuous relationship characterised with family violence, noting that the husband admitted the head-butting and choking. Both parties had Intervention Orders. The parties lost money in a business and also on cryptocurrency and on one property. Counsel submitted the E Street, Suburb F property was worth $965,000, encumbered by a mortgage. The boat was the subject of $56,000 insurance less the $25,000 to repurchase. It was submitted that the wife’s value for the boat of $40,000 was reasonable in the circumstances. The motor vehicle 1 was worth $21,000 from Redbook with $13,500 owing. The loan from the wife’s father had been reduced by training courses and there was $9,000 left. The husband wants the rings returned but these were gifts. But he would take them at $80,000. The wife did not accept this. The wife sought a 65/35 division in her favour involving a cash payment to her.
The wife was called and adopted her trial affidavit and further affidavit of 1 June 2021 and her financial statement as true and correct.
Under cross-examination, the matter was attended by a certain measure of difficulty as the husband’s questions (understandable given his self-representation) tended to be somewhat elliptical and perhaps over-generalised. He asked the wife to describe the relationship between two people. The wife said this was two parties working together with common vision to share a family and life together. Love was the ability of two people to tune in and be in each other’s cheerleader. The wife was asked how she would describe the relationship when they were together. She said at the beginning, they had some really good times when they had the children. It failed through arguments and violence. There was regular intimacy but there were different views as to who could be invited into the bedroom. The final point was in 2019 when they were at a restaurant in Suburb W, Sydney. The wife said she had lost weight. She was not prepared to do the swingers parties. The husband put it that their models (I infer of sexual activity) changed after the birth of Y. The wife said there was continued intimacy. She could not say when the relationship changed. In response to a rather convoluted question, the wife said she did not think that it was hard for him to love her at times. Some times were good. When they were arguing, it was not good.
The husband asked what the wife’s motivation was when she came into the relationship. The wife said she had not had a great family herself. The husband had lovely daughters and she thought it would be a blended family and that they would have their own children. The husband cross-examined as to whether the wife had ever felt accepted and put page 2 of annexure 12 (exhibit A2) to her. She conceded that she had written the entire paragraph. She also conceded writing on page 3 of the annexure that she had never felt part of his family. She said this may have been meant to hurt him. When taken to page 4 of the annexure, she said she was referring to 2013. She denied they slept in separate rooms. Annexure 13 was when they were living in Sydney. There were periods of separation when she went to her mother’s. She had said that she had never loved him and never would during arguments. At times, she had said she only stayed for the kids. She had told him in anger that she was leaving and taking everything.
When asked about annexure 7 (exhibit A1), the wife said that in 2018, she had weight loss surgery. In 2018, they went to Sydney. In January 2019, the relationship ceased. She was asked if she had thought the relationship would work from 2017 onwards. She said she had every intention to make it work. She referred to having undertaken counselling. When it was put that they continued arguing from 2017 onwards, the wife said no. She asked why they had gone to a psychologist in 2018. They had had good periods up to January 2019. The husband put it that she had applied for single parenting in 2017 and that there were continual arguments and that they had never come to a reconciliation but the wife disagreed. She thought that they had difficulties but were still trying in the relationship. Sometimes they separated. There were peaks and troughs. There were periods they separated and periods when they were together. They had been on a holiday to Country Z in 2017. She had applied for single parent in 2017. There were periods where they were coming back together and giving the relationship a go from her perspective. The periods when she was living with her mother were varied. Her parents are divorced and she did not want to do this to her children. Annexure 7 was tendered as exhibit A1, annexure 12 was tendered as exhibit A2, annexure 13 was exhibit A3.
There was no re-examination.
FINAL SUBMISSIONS FOR COUNSEL FOR THE WIFE
Counsel submitted that the first issue, was the date of separation. The point of difference was raised only on Thursday the proceeding week. It was clear the Court could make a relevant declaration pursuant to section 90SP and SN of the Family Law Act 1975 (“the Act”). The relationship must exceed two years. There were two children. The wife had made a lump sum contribution and was the homemaker. None of the husband’s objections were raised properly and the wife was not out of time. There were short periods during which the wife would leave after 2016 and would do so for respite. The husband misconceives the nature of a de facto relationship. A diminished sex life or more arguments does mean the end of the relationship. Counsel referred to section 4AA of the Act. The relationship started in March 2013 and as of Thursday last week, the husband accepted that separation occurred in May 2019. The husband was legally represented when separation was said to be 1 May 2019. The amended application had the same separation date and at that time, the husband was again legally represented. The husband filed taxed returns from 2016 to 2017 and 2018 to 2019, saying he was in a relationship. There was common residence at E Street, Suburb F. The husband said he cared for the children after work. The second child was born in 2017 and he had referred to a period of five months in Sydney in affidavit material. He now says it was now possibly four months when the wife came back to E Street, Suburb F. It was agreed that a relationship continued till 2016. In May 2019, the husband had refinanced to pay-off a joint credit card debt. So far as mutual commitment was concerned, the wife said there were highs and lows and there were good times till 2019. They had co-hosted birthday parties. The husband was disingenuous about the date of separation. He blamed his lawyers and also N Accountants. The husband is a professional person who would be expected to have attention to detail. The husband is disappointed and angry and wants no adjustment. There was no cross-examination by him on financials. He disputed the original valuation of $870,000. A valuation dated 24 April 2020 says $900,000.
The husband’s friend, Mr T, was partial. He had been to birthday parties and had said they came back together. It was submitted that the wife was honest and clear under cross-examination. Swing sex brought the relationship to an end. The husband admitted head-butting and choking, which led to the Intervention Order. The wife was concerned she would be kicked out. She took little when she left. She moved to her mother’s and is still the children’s primary carer. The husband had the family home and it was a 4/10 arrangement until March 2020 when it became 5/9. The husband took her off the health insurance. He pays Child Support. The wife seeks a property adjustment.
Counsel turned to the decision of the High Court in Stanford. The matrimonial home is in the husband’s name and it is just and equitable there would be a property adjustment. Mr U’s evidence was clear and should be accepted. The husband said it had $300,000 equity at the start but the wife says none. In his March 2020 affidavit at paragraph 9, the husband said he bought the property for $365,000 with a loan for the same amount. In paragraph 14 of that affidavit, he had deposed to having $100,000 savings but there was no evidence, and about $200,000 super. He owned a vehicle and boat plus Suburb AA. The wife accepts the husband had $40,000 at the start and gave her $27,000 for her former partner and $11,000 for her debt. The boat had been stolen and $56,000 paid but it was bought back for $25,000. The $40,000 value was reasonable. The Suburb G property has only a small equity. The rings were a gift but the husband can accept them for $80,000 or they can be sold. There should be an equalisation of superannuation achieved since cohabitation and this would lead to a split of $137,858 in the wife’s favour. Super Fund B had already been given procedural fairness.
Counsel pointed to the matters for consideration under section 90SN. There had been a sale of the H Street, Suburb J property for $262,000 and her father had invested $90,000 in the failed business. The wife has the primary care of the children and the husband works full-time. The children have been with the wife since separation and her mother has been of some help during the relationship. She enabled the parties to go on holidays. So far as future earnings were concerned, the husband would earn $250,000 plus bonuses whereas the wife only earned $38,000 last year. She remains the primary carer. An adjustment of 65 to 35 per cent in her favour was appropriate. Counsel sought the orders in the case outline.
In response to a question from the Court as to what should be made of the wife’s application for and receipt of a single parent benefit, counsel submitted that this was not a matter of separation but rather fraud on the Commonwealth. It should be noted that the wife had been given a section 138 Certificate prior to giving her evidence voluntarily.
FINAL SUBMISSIONS OF THE HUSBAND
The husband said the relationship ended in late 2016 when the wife applied for the single parent allowance. Attempts to resurrect the relationship failed and they gave up in January 2019. The exchange of rings from 2015 was not a gift because they did not exchange vows.
I asked the husband whether he had any position to put in the alternative, as it seemed clear that his submissions were totally fixed on the date of separation and the concomitant submission that the wife receive nothing. I pointed out that on any view the relationship had lasted for three years. Having had some time to consider his position, the husband said that he could agree to the superannuation split of $133,700 asked for. He was happy to pay $80,000 for the rings. He then went on to detail the amounts that would be necessary to pay the wife out what she sought. He then appeared to suggest that a sum of $100,000 might be appropriate and that the wife could keep the two rings.
FINDINGS AS TO CREDIT OF THE PARTIES
It has to be said that some of what the husband had to say from time-to-time, particularly when he was crafting somewhat unusual questions in cross-examination was slightly strange. Nonetheless he answered the questions put to him very directly and candidly. While one recoils from the facts of his assaults upon the wife, he made no attempt whatsoever to deny them. He immediately admitted choking the wife and head-butting her. He also readily admitted taking her off the health insurance. There is no doubt that from time-to-time, the husband’s embitteredness as to the outcome of the relationship has found its expression in the most unfortunate ways, including the text that he sent to the wife at or about the time of separation. Nonetheless, while some of the things he did were extremely unattractive, it is difficult to see how a person who so readily makes admissions against himself can be thought wholly untruthful. As I say, he readily admitted telling the wife she could get her own healthcare because she had a boyfriend at S Insurance, scarcely an attractive thing to admit. I formed the very clear view that the husband was a witness of truth, notwithstanding his pitiless approach towards the mother of his children and his obvious feelings of bitterness towards her.
The wife by way of contrast was not a good witness, contrary to the submissions of her counsel. She became labile on a number of occasions throughout the proceedings, which I understood from a remark made by her counsel to be commonplace for her. A number of her answers were quite obviously self-serving and clearly turned to meet what she perceived to be the exigencies of the moment.
It should also be noted that the evidence of Mr T was transparently honest. This is not without significance because he was strongly pressed to the effect that it was the husband who sought for the wife to make a Centrelink application in 2016 and his denials and assertions that it was the wife were given in a fashion I find completely credible. It follows inextricably from this that the wife’s evidence to the contrary effect was untruthful.
Finally, it should be noted that Mr U, the valuer, was an excellent witness as I have already said.
STANFORD V STANFORD
The Court’s first task is to ascertain the legal and equitable interest of the parties and determine whether a property adjustment is indeed just and equitable. This task is rendered all the more important in this case by the fact that it is indeed the husband’s primary position that there ought not be a property adjustment at all, bearing in mind what he would say was the length of the relationship and the measure of the parties’ contributions.
The pool, in my opinion, consists of the following:
(a)Matrimonial home: $965,000;
(b)Boat: $40,000;
(c)The wife’s one-third interest in the Suburb G property: $8,332;
(d)Rings: $80,000;
(e)Liabilities, mortgages: $550,000 (rounded-off);
(f)Additionally, the wife presently has $37,192 in superannuation and the husband has $450,414.
I have accepted the wife’s valuation of the boat at $40,000. The evidence is that the husband received $56,000 from the insurance payment and applied $25,000 with that to repurchase the boat. He had $31,000 left over to refit the boat and it seems reasonable to suppose that since he paid $25,000, some greater value must have been obtained. While this involves an unfortunate element of guesswork, I think that that is an appropriate figure. It should be noted that the husband has never completed a financial statement which details his assets on oath as an admission against interest nor has he tabulated the pool in any coherent way in any of his affidavits.
I have not included the wife’s or the husband’s vehicles. Neither of these vehicles have any great second-hand value and if they were to be sold, the parties would simply have to buy another one. To suggest that they involve an asset in any meaningful sense is to miss the point.
Likewise, given that separation was over two years ago, I do not propose to include the parties’ current bank accounts which, in my view, are more likely than otherwise to reflect the post separation circumstances.
Similarly, I do not propose to allot any value to the parties’ household contents. None of them have been valued and while I accept that the husband retains the fully furnished matrimonial home (another concession he made readily in cross-examination), there is no evidence as to whether any of the goods in that house have any meaningful resale value. The only things that are valued are the rings.
The wife has sought to include loans from her parents but there is no evidence as to whether these sums, which I am prepared to accept were advanced, were the subject of any loan in any meaningful sense. The wife has not put forward any loan documentation nor are either of her parents on affidavit. If there is any money owing, it is certainly not going to be enforced. If the wife chooses to repay, that of course is a matter for her.
It is put that there should be an addback for the shortfall of the sale of the Suburb K property. I do not accept this either. According to the wife, this property was bought during the currency of the relationship and sold shortly thereafter. Any losses are simply part of the warp and woof of the matrimonial relationship. In my view, she must take the good with the bad.
I have included the wife’s trial affidavit figure for the two mortgages. The husband asserted a total of $470,000 in his affidavit filed 23 March 2020 but the wife was not cross-examined about her assertion that there is one mortgage (E $460,000) and an additional one (E $88,350). I have rounded of the total to $550,000.
THE DATE OF SEPARATION
While this issue does not ordinarily arise for consideration in this way, given the inordinate emphasis given to it in this trial, I propose to deal with this as a discrete issue now. First of all, there is no doubt that the parties were in a relationship from 2013 to 2016. The husband admits this. The question is what is one to make of it after that.
It is clear that the wife applied for single parent benefit in about August 2016 when she spoke to Mr T to get him to witness her application. At that time, she told him that they were separated and she had gone home to her mother with the children. Plainly, that was her state of mind at the time and some of her more anguished messages to the husband suggest that at least from time-to-time, she has felt that the relationship never really worked at all. However, as I find, that these were simply florid and overstated expressions of emotion to which it seems clear that the wife has been given from time-to-time. They are not as decisive as the husband would like to have them.
Thereafter, the parties had a tumultuous on-again-off-again relationship. I have no doubt whatever that it could properly be characterised as toxic as I think both parties did from time-to-time. Were they in a de facto relationship within the meaning of section 4AA of the Act? One can view that matter both ways. Sexual intimacy did not appear to cease throughout. Their second child was born in 2017. They went on a holiday together to Country Z in 2017. The wife and children went up to Sydney at least for some months in 2018 while the husband was working there. The husband put it that there were attempts of reconciliation which never really worked. Having seen his, in the end, relatively sustained and effective cross-examination that is certainly one characterisation one could adopt.
However, I think that the notion of separation in 2019 is plainly one of recent invention. The husband’s legal documentation filed when he was represented put the date of separation as
1 May 2019. The husband has said that it is only in the last month or so that he has come to realise what a de facto relationship is and he has blamed this on his former solicitors and his accountants for any documents that suggest otherwise. This is disingenuous. There is no doubt that while the relationship had tremendous difficulties between 2016 and 2019 and that the wife moved out for periods of time (nobody has given me any clear idea of how often and for how long but the overarching impression is that they were relatively short periods), but the parties plainly represented themselves as a couple from time-to-time. They hosted joint birthday parties. As Mr T himself said they came together.As against this, it would appear there was very little, if any, joint financial contribution post 2016. Both of the parties were well aware, as I find, that the wife was receiving statutory benefits to which she was not entitled throughout.
In the circumstances, the proper legal characterisation is that separation took place in May 2019. But when one comes to the question of contribution, the dysfunctional and more importantly disjointed nature of the relationship requires to be considered. This was not an uninterrupted relationship between 2013 and 2019. It was a continuous relationship until 2016, and did continue in modified form till 2019, during which latter period, there were a number of interruptions.
THE QUESTION OF CONTRIBUTION
At the commencement of the relationship, the husband already owned the E Street, Suburb F property and had done so for some six years. There is no evidence as to what the equity in the property was. The husband has naturally sought to inflate it and the wife to decrease it. I am not able to make any findings as to what extent there was equity. The one thing that one can say is that it was not in arrears because there is no evidence of any demands ever having been made. The property must have accrued given the general march of property prices in Melbourne by some amount from what it was at the time it was purchased.
The wife also owned a property in H Street, Suburb J which was sold with a net relevant amount of $262,000 in 2015. I accept that $60,000 or so of that was applied to the general wellbeing of the parties and to repay credit card debts.
Turning to the, perhaps, important issue of what happened to the $142,000 that was paid into the mortgage, I accept the husband’s evidence that this was repaid to the wife. I accept his evidence that the BSB number is at a bank in Suburb R, near the wife’s business. I do not accept the wife’s suggestions that she did not get this money back. I have heard her and the husband and I believe the husband in this regard.
This is all the more likely to be the case because there was no obvious benefit to the husband in increasing his mortgage by $142,000. He was in full-time employment effectively throughout this relationship. I appreciate that there were losses on cryptocurrency and losses on the Suburb K property. Nonetheless what is far more probable is that the business swallowed it all up. The business swallowed, without any difficulty, the $90,000 advanced by the wife’s father and other invested funds. It was plainly a disaster all round. I think it is more probable than otherwise that that is where that money went.
I note that the wife concedes that the husband paid $42,000 effectively towards various obligations of hers at the start of the relationship. This is offset by the wife’s contribution to the boat.
Other than this, the contributions of the parties might have reasonably been thought to be relatively comparable. The husband was the primary earner and worked long hours in senior positions. The wife, however, also worked for most of the relationship although self-evidently, not in nearly as remunerative work. Her mother must have helped quite significantly from time-to-time in looking after the children, and also enabling the parents to go off on holidays alone.
Following separation, the children lived with the mother initially for one year in a 4/10 arrangement and subsequently 5/9 which will in two years’ time become 8/6, something fairly close to even. Nonetheless, the father’s denial that the mother was not at all times the primary carer flies completely in the face of the evidence as a whole. It flies in the face of the outcome to which the father has himself agreed in the final parenting orders.
In circumstances where the only significant hard asset that the parties really have, apart from the rings, is a property that the husband owned for almost as long before the relationship itself (2013-2019), there must be a considerable emphasis given to the husband’s contribution. Equally however, the role of the mother as a carer and housekeeper should not be assessed in any tokenistic way as the High Court made clear in the case of In the Marriage of, Re Mallet [1984] HCA 21 (“Mallet”). Calibrating all these matters together is self-evidently a matter of evaluation in which necessarily some element of impression plays a part.
In all the circumstances and noting some significant additions to the house effected by the husband (e.g. swimming pool), which have not been valued in any precise way, I would characterise the parties’ contributions to the ultimate outcome that obtains (leaving aside superannuation) as being 70 per cent to the husband and 30 per cent to the wife.
This brings us to the particular issue of the two rings. The husband’s pitiless demand for their return speaks volumes for his bitterness and parsimony. Nonetheless, these were rings given in anticipation of marriage and the marriage certainly never took place. This whole business aspect of the matter is distasteful. In the circumstances, I am going to order that they be sold and the proceeds split equally between the parties. I will otherwise excise the rings from the pool as this rather tawdry dispute represents a discrete, severable aspect of the conflict between the parties. I think that these were intended as a gift but were intended as a gift in contemplation of a particular outcome that simply never occurred. I think that the just and equitable outcome, as I say, is that the rings be sold and the proceeds divided equally.
FUTURE NEEDS
The husband is substantially older than the wife, but he will make far more money than she does. He has a good number of years of employment ahead of him. He has now been in employment for two years and at some point, presumably he will start earning bonuses as well as his base salary.
The wife’s future earnings are much harder to calibrate. Although she only made $38,000 in her fledging business in the 2020 financial year, in my opinion, that is by no means that bad a start. The wife is a woman who plainly proposes to commit herself in a reasonably committed way to this activity. And I note that from the time she is fully qualified, the children will be in an 8/6 arrangement which will make it much easier for her to work. I cannot, of course, say for a moment what she will earn when her earnings reach the sort of fruition that, in my opinion, is more likely than otherwise from 2023 onwards, but I can say it will never be anything remotely as much as the husband’s. The children will from 2023 be living in something close to an equal time regime. In my opinion, there should be a 5 per cent adjustment to the wife in respect of future needs. Neither party has any health difficulties that appear to operate on the matter, and the children will be in something relatively close to an even time regime from 2023 onwards.
JUST AND EQUITABLE
In my view, an outcome that gives the husband 65 per cent of the value of the former matrimonial home and the wife 35 per cent is indeed just and equitable in all of these circumstances.
That leaves the question of superannuation.
SUPERANNUATION
I accept the wife’s evidence that the husband had at the commencement of cohabitation $166,000 and the wife had $28,500 in superannuation. The husband resists any superannuation split to the wife but appeared to suggest the alternate position that he would agree to the split that the wife seeks. In my view, the just and equitable outcome is that there should be an equalisation of superannuation (dealing with superannuation as a separate issue in this case) of the amounts by which the superannuation increased during the period of the relationship. Counsel for the wife said that the wife should have an equalisation up till the date of trial, and of course, it is a fact that there is a general rule that the Court is required to assess the parties’ assets as at the date of trial (see AJO v GRO (2005) FLC 93-218). In this instance, however, whatever benefits were accrued to the husband during the relationship and, thus as it were, enabled him to accrue his superannuation, it came to a complete halt in May 2019 (and had altered to an extent at least from 2016). In my opinion, there should be an equalisation of the parties’ superannuation as at the date of separation. Neither the husband’s superannuation at the date of separation nor that of the wife seems to be detailed in the parties’ materials.
I will need to be given these figures to ascertain the relevant superannuation split.
I certify that the preceding one hundred and seven (107) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Burchardt. Associate:
Dated: 5 August 2021
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