AVERILL & AVERILL
[2021] FCCA 1538
•7 July 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
| AVERILL & AVERILL | [2021] FCCA 1538 |
| Catchwords: FAMILY LAW – Property – application pursuant to section 79 – Court finds it is just and equitable to make an order pursuant to section 79 – consideration of matters under section 79(4) – orders made. |
| Legislation: Family Law Act 1975 (Cth), ss.75, 79 |
| Cases cited: Hepworth v Hepworth (1963) 110 CLR 309 |
| Applicant: | MS AVERILL |
| Respondent: | MR AVERILL |
| File Number: | SYC 7567 of 2019 |
| Judgment of: | Judge Morley |
| Hearing date: | 10 November 2020 |
| Date of Last Submission: | 10 November 2020 |
| Delivered at: | Sydney |
| Delivered on: | 7 July 2021 |
REPRESENTATION
| Solicitors for the Applicant: | Ms Santo of Santo Family Lawyers |
| Counsel for the Respondent: | Ms Snelling |
| Solicitors for the Respondent: | Roden Solicitors |
ORDERS
The Court orders pursuant to section 79 of the Family Law Act 1975 (Cth):
(a)That Order 1 made on 10 November 2020 is discharged.
(b)That the specified percentage of all splittable payments made to the Applicant Wife as required by section 90XT(1)(b) of the Act out of the interest held by the Respondent Husband in Super Fund B is 73.92%.
(c)That whenever a splittable payment within the meaning of section 90XE of the Act becomes payable to or on behalf of the Respondent Husband from his interest in Super Fund B, the Applicant Wife is entitled to be paid 73.92% of the splittable payment and there shall be a corresponding reduction in the amount the Respondent Husband would be entitled to receive but for these Orders.
(d)That Order (1)(b) has effect from the operative time.
(e)That the operative time for the purposes of Order (1)(c) is the fourth business day after the date of service of these Orders on the Trustee.
(f)That this Order binds the Trustee.
(g)That within sixty (60) days of the date of these Orders the Respondent Husband do all acts and things and sign and sign all documents necessary to transfer to the Applicant Wife his whole right, title and interest in the property situated at and known as C Street, Suburb D in the State of New South Wales described in certificate of title … (‘the C Street, Suburb D property’).
(h)Simultaneously with the Respondent Husband’s compliance with Order 1(g) herein, the Applicant Wife is to do all acts and things and sign all documents necessary to discharge the mortgage to the National Australia Bank registration number … (‘the NAB mortgage’) secured on the title of the C Street, Suburb D property and the Respondent Husband is to sign all documents necessary to give effect to this order.
(i)That the Respondent Husband is restrained by injunction from redrawing any funds from the National Australia Bank account number ending #...51 in the parties’ joint names.
(j)That pursuant to section 106A, the Applicant Wife is appointed as trustee for the Respondent Husband to do all such acts and things and sign all documents necessary to cause the funds in all joint accounts to the following joint bank accounts be paid to the Applicant Wife and the accounts closed including the following accounts:
(i)Westpac Choice account number ending …45;
(ii)National Australia Bank account number ending …77; and
(iii)National Australia Bank account number ending …68.
(k)That within 14 days of the date of the Orders:
(i)The Respondent Husband make available for the Applicant Wife’s collection the Motor Vehicle 1 registered in his name; and
(ii)Transfer to the Applicant Wife, his whole right, title and interest in the Motor Vehicle 1
(l)That subject to these Orders that the Respondent Husband be entitled to the exclusion of the Applicant Wife to all property both real and personal in his ownership, possession and control now and in the future but not limited to.
(i)Monies held financial institutions in his name;
(ii)All insurance policies in his name;
(iii)Motor vehicle registered in his name; and
(iv)His entitlements in any superannuation fund subject to these Orders.
(m)That subject to these Orders that the Applicant Wife be entitled to the exclusion of the Respondent Husband to all property both real and personal in her ownership, possession and control now and in the future but not limited to:
(i)Monies held financial institutions in her name;
(ii)All insurance policies in her name;
(iii)Motor vehicle registered in her name; and
(iv)Her entitlements in any superannuation fund.
(n)The Respondent Husband indemnify and keep indemnified the Applicant Wife from and in respect of any actions, claims, suits and demands as may be made against the Applicant Wife in relation to any liabilities in the name of the Respondent Husband and any other liabilities in relation to any property that vests with the Respondent Husband pursuant to these Orders.
(o)The Applicant Wife indemnify and keep indemnified the Respondent Husband from and in respect of any actions, claims, suits and demands as may be made against the Respondent Husband in relation to:
(i)All liabilities arising under the Loan Agreement between the parties and Ms J dated 3 December 2013;
(ii)Any liabilities in the name of the Applicant Wife; and
(iii)Any other liabilities in relation to any property that vests with the Applicant Wife pursuant to these Orders.
In default of the Respondent Husband doing all acts and things and executing all such documents as are necessary to give effect to these Orders within the time period stipulated, a Registrar of the Federal Circuit Court of Australia at Sydney be appointed pursuant to section 106A to execute all such documents in the name of the Respondent Husband and to do all such acts and things necessary to give validity and operation to the said Orders.
Pursuant to Rule 16.01, the Respondent Husband is restrained from bringing any application pursuant to Rule 16.05(2)(a) of the Federal Circuit Court Rules 2001 (Cth)
Direct the Applicant Wife file and serve any affidavit in relation to her application for costs as contained in her Case Outline document for the undefended hearing conducted on 10 November 2020 by no later than 4:00PM on 21 July 2021.
Direct the Respondent Husband file and serve any affidavit in relation to the Applicant Wife’s application for costs by no later than 4:00PM on 4 August 2021.
Direct the Applicant Wife file and serve any written submissions in support of her application for costs as contained in her Case Outline document for the undefended hearing conducted on 10 November 2020 by no later than 4:00PM on 13 August 2021.
Direct the Respondent Husband file and serve any written submissions in reply by no later than 4:00PM on 23 August 2021.
Direct the Applicant Wife file and serve any written submission in reply by no later than 4:00PM on 2 September 2021.
IT IS NOTED that publication of this judgment under the pseudonym Averill & Averill is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYC 7567 of 2019
| MS AVERILL |
Applicant
And
| MR AVERILL |
Respondent
REASONS FOR JUDGMENT
Introduction
These are Reasons for Judgment in relation to an undefended hearing I conducted on 10 November 2020 on the application of the applicant wife Ms Averill (henceforth ‘the wife’). The respondent husband Mr Averill (henceforth ‘the husband’) appeared at the undefended hearing, in circumstances which I will detail later in these Reasons.
The parties commenced cohabitation in about 2008. They married in 2010, and separated under the one roof on 2 December 2018. The husband vacated the former marital home on 26 January 2019. As the matter proceeded on an undefended basis, I have only had recourse to the evidence of the wife in relation to this timeline.
There are two children of the marriage, X born in 2011 and aged nine years four months at the time of the undefended hearing, and Y born in 2013 and aged seven years seven months at the time of the undefended hearing.
While the undefended hearing did not concern parenting matters, it is salient to note that the wife’s evidence is that the children live with her and spend five nights per fortnight with their father.
History of proceedings
The proceedings were commenced by the wife filing her Initiating Application on 8 November 2019, accompanied by an affidavit sworn or affirmed by her and her Financial Statement.
The wife filed an affidavit of service on 11 February 2020. That document was sworn by Mr F, a licenced process service. That affidavit deposes that on 17 January 2020, in the early afternoon, Mr F handed the wife’s Initiating Application, affidavit, and the relevant brochure to “the person at G Street, Suburb H NSW”. Mr F deposes that the person signed an Acknowledgment of Service, and:
I said: “Are you MR AVERILL?” The male person replied: “Yes.” I said: “I have an Initiating Application and supporting documents for you. Are you the person named in these proceedings?” The male person replied: “Yes.” I asked: “Will you sign this Acknowledgment of Service?” The male replied: “Yes.”
The matter then came before the Court on 13 February 2020 before Registrar Turner in the Discrete Property List. The orders of that occasion indicate that Ms Santo appeared as solicitor-advocate for the wife, and that there was no appearance for the husband.
On that date, the Registrar adjourned the matter to 30 March 2020 before a Registrar and, inter alia, made orders for the Respondent to file responsive material by 16 March 2020. The Registrar also made a direction to the Applicant[1] to serve by post and email upon the husband a copy of the sealed orders, which contained the following notation:
[1] Order 6 refers to “The Application” instead of “The Applicant”.
IT IS FURTHER NOTED THAT:
E. In the event that the Respondent does not file his material in accordance with these orders, or attend court on 30 March 2020, the Applicant seeks to have her Initiating Application heard on an undefended basis.
Non-Compliance
F. The consequences that follow from non-compliance with these orders include (but are not limited to):
a. An order for costs made by a Registrar for a Registrar’s Court event;
b. Referral to a Judge to enable a Judge to consider the making of a costs order (including fixed or indemnity costs) against a non-compliant party; or
c. Referral to a Judge to hear the case on a final basis in the absence of material from the non-compliant party.
The matter then came before the Court on 30 March 2020 again before Registrar Turner. On this occasion, Ms Santo appeared for the wife by telephone, and the husband appeared on his own behalf by telephone.
I note here that at this time, the SARS-CoV-2/COVID-19 pandemic was having an emerging but present impact on the lives of Australians. New South Wales was in the early stages of lock down, and the Court was in the early stages of converting all court events to occur by telephone or audio-visual means.
On this occasion, the Registrar adjourned the matter to 20 April 2020 for further directions. In respect of the husband, the Registrar directed him to file a Notice of Address for Service by 4:00PM that day (with which the court file indicates the husband complied), along with further directions to file his Response and supporting material, noting that the earlier deadline in the orders of 13 February 2020 had come and gone.
The Registrar also made sundry other directions relating to property and financial matters, such as directions relating to valuation and financial disclosure.
On the next occasion, 20 April 2020, the matter came before Registrar McGrath. Ms Santo again appeared for the wife, but there was no appearance for the husband. By this date, the husband had not filed any further material since the mention in March.
I am satisfied that the husband had notice of the court event before the Registrar on 20 April 2020, him having been before the Court on 30 March 2020 when the matter was adjourned.
I am also satisfied that on at least 30 March 2020, the husband had some knowledge of the possible consequences of not appearing at the further mention of the matter, in circumstances where the Registrar made several detailed notations in her orders of 13 February 2020 which must have come to the attention of the husband given his appearance on 30 March 2020.
On 20 April 2020, the Registrar transferred the matter to a mention before me on 21 May 2020. In making that order, the Registrar made the following notations:
D. The Court advised the Respondent of the Court date and time on the last occasion, and via email on 14 April 2020, at the email address provided in the Notice of Address for Service.
E. The non-compliance of the Respondent and undue delay imposed on the Applicant as a consequence requires the matter to be transferred to Judge Morley for consideration for the matter to be set down for undefended final hearing.
F. The Court is advised that the pool of assets is minimal.
On 21 May 2020, the matter came before me in my duty list. Ms Santo again appeared for the applicant, and again the respondent did not appear.
On this occasion, I listed the matter for undefended hearing on 10 November 2020. It is proper for me to explicate the orders and notations I made on that date relating to the undefended hearing and service in full:
1. The proceedings are listed for undefended hearing at 10:00AM on 10 November 2020.
…
3. Direct that the Applicant wife serve a sealed copy of the orders made today upon the Respondent Husband by forwarding same by prepaid post to the Respondent Husband’s address given as his address for service on the Notice of Address for Service filed 30 March 2020 and also by forwarding a sealed copy of the orders as an attachment to an email to the email address given by the Respondent Husband as an address for service on his Notice of Address for Service filed 30 March 2020.
4. The Respondent is to file and serve by 4:00PM on 31 July 2020 any Response pursuant to rule 4.03(1) and (2) of the Federal Circuit Court Rules 2001 (Cth) (‘the Rules’), and on filing such Response is to also file and serve with the Response a Financial Statement that complies with rules 24.02 and 24.03 of the Rules and affidavit that complies with rule 4.05(1) of the Federal Circuit Court Rules 2001 (Cth).
5. In the event that no Response and supporting documents are filed by the Respondent Husband by 4:00PM on 31 July 2020, the matter will proceed to an undefended hearing on 10 November 2020 whether or not such documents are filed by the Respondent Husband after 4:00PM on 31 July 2020, and whether or not the Respondent Husband appears before the Court or is represented before the Court on 10 November 2020.
6. Grant the Applicant Wife liberty to relist the matter on the giving of 14 days notice to the Respondent Father and to the Court, that the matter has been relisted consequent upon the Respondent Father complying with the orders made today for the filing of documents.
NOTES
A. Orders have been made today for a sealed copy of these orders to be served upon the Respondent Husband on the two addresses contained in his Notice of Address for Service.
B. Accordingly, upon compliance with the order for service, the Court will accept that that these orders were brought to the attention of the Respondent Husband.
C. The Respondent Husband should very carefully note the orders in relation to the filing of documents by him, and the consequences of failing to comply with the order herein to file Response material in this matter, being that the matter will proceed to an undefended hearing, even if the Respondent Husband files material but does so late, and even if the Respondent Husband is present, represented, or both, on 10 November 2020.
D. The Father was telephoned by the Court shortly prior to the matter coming before the Court at 10:00AM today on the telephone number appearing on the Notice of Address for Service that he filed on 30 March 2020. The Court’s call was not answered.
E. The parties are generally directed to ‘Joint Practice Direction 2 of 2020 – Special Measures in response to COVID-19’, attached to these orders and available at the Federal Circuit Court of Australia website.[2]
[2] Emphasis added.
I have set the above out in full to observe that the Court, again, went to some effort to explicate the possible consequences of the husband not filing material as directed by my orders.
In the lead up to the undefended hearing, the wife filed a bundle of further evidence, being:
a)An Amended Initiating Application filed on 19 October 2020;
b)An affidavit sworn or affirmed by her and filed on 15 October 2020, being her ‘trial’ affidavit;
c)A Financial Statement sworn or affirmed by her and filed on 15 October 2020, being her ‘trial’ Financial Statement;
d)An affidavit sworn or affirmed by Ms J and field on 15 October 2020. Ms J is the wife’s mother; and
e)An affidavit affirmed by the wife’s legal representative Carla Santo and filed on 27 October 2020.
The affidavit affirmed by Ms Santo sets out the steps Ms Santo took in compliance with the Court’s various orders for service and in accordance with her client’s instructions, including:
a)Sending a sealed copy of the orders of the Court made on 17 February 2020 to the husband by post and by email on 18 February 2020;
b)Sending a sealed copy of the orders made on 21 May 2020 to the husband by post and by email on 29 May 2020; and
c)Sending the wife’s undefended trial material under cover of letter by email on 19 October 2020.
Importantly, the orders of 21 May 2020 were the orders in which I set the matter down for undefended hearing, and made the various notations set out above.
Accordingly, I am satisfied that the husband was given more than adequate notice of the listing of the matter for undefended hearing, and that the husband had adequate time to file his responsive material should he have wished to do so prior to the deadline in those orders, avoiding the undefended hearing.
On 4 November 2020, Roden Solicitors filed a Notice of Address for Service for the husband.
On 10 November 2020, the matter came before me for undefended hearing.
The undefended hearing
Proceeding to undefended hearing
In light of the SARS-CoV-2/COVID-19 pandemic, the undefended hearing proceeded by Microsoft Teams.
Ms Santo appeared as solicitor-advocate for the wife. Ms Snelling of Counsel appeared for the husband.
At the outset of the hearing, Ms Snelling sought leave to rely upon an Application in a Case, affidavit, and Financial Statement sworn by her client on 9 November 2020. I granted leave to the husband to file his Application in a Case, affidavit, and Financial Statement all sworn or affirmed on 9 November 2020 in Court, with directions to pay any necessary filing fee. That Application in a Case sought one order only, “That the hearing of the application for final orders be adjourned”.
Ms Santo advised the Court that she had received the husband’s unsealed material a few hours earlier when the husband’s solicitors emailed my Associate with the documents. Ms Santo advised the Court that her client opposed the husband’s application, and that she was instructed to press for an undefended hearing.
I received submissions from Ms Snelling in support of her client’s Application in a Case. The crux of her submission was that the Court would be minded to accede to the husband’s Application in a Case on the basis of the husband having suffered from mental ill health issues consequent upon the breakdown of the marital relationship that have prevented him from being able to ‘face’ the parties’ separation and the existence of the property proceedings.
The husband gives some evidence in his affidavit of examples of his being unable to face the proceedings, and annexes to his affidavit a letter from his general practitioner, about which I will go into more detail further on.
Ms Santo made submissions in reply and I took submissions in reply to the wife from Ms Snelling.
I have had recourse to the audio recording of the proceedings in preparing these Reasons for Judgment.
It is convenient here to note that the husband did not raise any assertions relating to any failure to provide him with procedural fairness by reason of the wife’s failure to serve him as directed. Accordingly, for the avoidance of doubt, I find that the wife at all times complied with the relevant rules in the Federal Circuit Court Rules 2001 (Cth) and the Court’s directions to serve material upon the husband.
In support of her client’s opposition to the Application in a Case, Ms Santo provided to the Court an affidavit sworn by the husband in the parties’ divorce proceedings. I did not formally mark that affidavit as an exhibit at the time but I say that I have read and considered the evidence.
After hearing submissions in chief from each party, I advanced several grounds with the parties upon which I was considering the husband’s application, and I took submissions from Ms Snelling on each of those matters in particular. It is appropriate to turn to each of those in turn.
The weakness of the husband’s evidence regarding his failure to participate in the proceedings
The crux of the husband’s application to adjourn the hearing was premised on his assertion of experiencing mental health issues consequent upon the breakdown of the relationship affecting him such that he could not face or participate in the proceedings. In this regard, the Court was provided with some affidavit evidence from the husband and a letter from his general practitioner Dr K annexed therein.
On the husband’s evidence, the husband suffered “depressive symptoms” relating to an incapability to accept that the marriage had broken down, and sadness at missing his children and “losing” a close relationship with them. This resulted in him experiencing difficulty concentrating and managing his day-to-day responsibilities and functioning including paying bills, being incapable of taking legal advice provided to him, denial that the matter was listed for undefended hearing, an inability to “function at a level required to give appropriate instructions to a lawyer”.
It is the settled law of this Court that in relation to proceeding on an undefended basis, procedural fairness requires that the party against whom the proceedings may proceed undefended must be given a proper opportunity to participate in the proceedings.[3] Of course, the Court is not required to provide a litigant with unlimited opportunities to participate in proceedings.[4] Rather, in Allesch v Maunz,[5] Kirby J identified in particular the following:
[39] Decision-makers, including the courts, cannot generally force people to protect their own rights, to adduce evidence or other materials, to present submissions or to act rationally in their own best interests. This consideration may be especially relevant in relation to the Family Court where emotions, often engendered by the highly personal issues involved, can sometimes cloud rational thought.
[40] Nor are courts obliged to delay proceedings indefinitely because one party, although proved to be on notice of the proceedings, refuses or fails to appear in person or to be represented by a lawyer or some other individual permitted to speak for them who can explain the need for an adjournment. The rights of other parties are commonly involved. In the Family Court, the rights of non-parties (especially children) may be affected. Additionally (as this Court has itself accepted (Sali v SPC Ltd [1993] HCA 47; (1993) 67 ALJR 841 at 849; [1993] HCA 47; 116 ALR 625 at 636; Queensland v J L Holdings Pty Ltd [1997] HCA 1; (1997) 189 CLR 146 at 153, 168; cf Doherty v Liverpool District Hospital (1991) 22 NSWLR 284 at 296.), the rights of the public in the efficient discharge by courts of their functions must be weighed against unreasonable delay in concluding litigation.[6]
[3] Talbot & Talbot [2015] FamCAFC 132, [21].
[4] Allesch v Maunz (2000) 203 CLR 172, [40].
[5] Allesch v Maunz (2000) 203 CLR 172.
[6] Allesch v Maunz (2000) 203 CLR 172, [39]-[40].
A relevant consideration to proceeding on an undefended basis is the “inability or unwillingness to cooperate with the court and the other party…”.[7] Of course, where an inability to participate in the proceedings is made out by a litigant, it would be highly relevant in the exercise of the Court’s discretion.[8]
[7] Lenijamar Pty Ltd v AGC (Advances) Ltd (1900) 27 FCR 388, 396.
[8] Talbot & Talbot [2015] FamCAFC 132, [17]; see also Taylor v Taylor (1979) 143 CLR 1; In the Marriage of Wilkes (1981) 7 Fam LR 58; Leslighter & Fitzgerald-Stevens (2012) 47 FamLR 384.
It is of note that the gravamen of the husband’s application is reminiscent of that which was contemplated by the Full Court in Talbot as “temporary disabilities which (again inferentially) are now not present”.[9]
[9] Talbot & Talbot [2015] FamCAFC 132.
The evidence of the doctor is contained in a letter dated 5 November 2020. In that letter, the doctor states that he consulted with the husband on 13 February 2019, nine months prior to the wife commencing proceedings in this Court and over a year prior to the matter coming before the Court for undefended hearing.
The evidence of Dr K in full is as follows:
I consulted with Mr Averill on 13/02/2019 after his marital breakdown. At that time he appeared to be experiencing a grief reaction to major life adjustments. He felt down, flat and somewhat hopeless with the loss of his former family life. In my professional opinion, this was an appropriate emotional response to his predicament. He missed his daughters intensely.
Whilst he experienced some depressive symptoms at that time I believe these were largely reactive to the situation he was in, and I would not classify him as having Major Depression.
He has emotionally and psychologically adjusted to the new family dynamics and no longer has any depressive or anxiety symptoms.
As I noted in the proceedings, that evidence does not indicate that the doctor had any consultation with the husband after 13 February 2019 and does not speak to the husband’s health at any time after 13 February 2019.
Moreover, the doctor specifically excludes any diagnosis of Major Depression even at the height of the husband’s mental ill-health. He specifically excludes the possibility that the husband was experiencing depressive or anxiety symptoms as at November 2020.
Taken at its highest, the letter does not support the husband’s assertion in his evidence that he was incapable of taking legal advice provided to him, that he was in denial that the matter was listed for undefended hearing, or that he was incapable of being able to give instructions to a solicitor. I am especially of this view in light of the husband appearing for himself before the Court on 30 March 2020.
Moreover, in relation to the factual assertion of the husband having experienced a loss of his relationship with his children, the husband gives no evidence of the time he has spent with his children, any efforts by him to increase the time he spends with his children, and certainly no evidence to establish the basis for such an assertion.
I accept the evidence of the wife that the husband has been spending five nights per fortnight with his children, especially in light of the husband failing to put on any evidence to the contrary in light of his own affidavit in the divorce proceedings stating that he has the children “35%” of the time.
Finally, I accept the evidence of the wife that the husband has re-partnered. This would not necessarily militate against a finding that the husband might have also experienced sadness at the breakdown of his marriage, but in the context of the full constellation of evidence, I find it is relevant.
Accordingly, I do not accept that the husband had an incapacity to participate in the proceedings consequent upon his mental health.
As already set out above, I was satisfied that the husband had been given adequate notice of the proceedings. He had been given adequate time to file his responsive material – moreover, the Court granted the wife leave to restore the matter to my list in the event that the husband did file his material, so that suitable directions to progress the matter could be made by the Court without delay. Nonetheless, the husband did not file his responsive material until, truly, the very last minute.
The prejudice to the wife
In circumstances where I have found against the husband in relation to his substantive application, I will now consider the matters of prejudice in reply to which Ms Snelling made submissions in reply.
I find that there would have been prejudice to the wife in relation to her incurring ongoing legal costs were the husband to be allowed to re-enter the proceedings, as compared to her legal costs ceasing as of the date of the undefended hearing (subject to any appeal).
I find that there would have been a possible prejudice to the wife in the event that the husband re-entered the proceedings and the matrimonial home (the substantial asset of the marriage) increased in value. As I noted in the proceedings, that would have a commensurate effect on the wife’s position, for which she has prepared as of 10 November 2020.
I find that there would be a prejudice enacted upon the wife noting the delays in this Court for matters awaiting a final defended hearing. While the possibility of the matter settling would have existed as noted by Ms Snelling, I do not find that such a possibility negatives the prejudice of the delay, which is a known actuality and not a mere possibility.
Finally, I find that the possible emotional toll that this litigation could have upon the wife were these proceedings to continue would be unacceptable. For completeness, I note that Ms Santo did not make any submissions on this particular basis for her client, but the reality of the emotional toll that litigation has on litigants (especially in the family law jurisdiction) is well known.
Ms Snelling observed that the husband would be exposed to a comparative prejudice if he were to re-enter the proceedings as a litigant, however I do not accept that submission. Any prospective emotional toll on the husband consequent upon this litigation would be unfortunate, but not a prejudice, him necessarily having succeeded in his Application in a Case.
In circumstances where the husband did not make out the basis for his application to adjourn the undefended hearing, I find that I prefer the interests of avoiding these prejudices to the wife.
The prejudice to other litigants
I am mindful of the comments of Kirby J in Allesch & Maunz and the obligation of this Court to use the resources of judicial time with efficiency.[10]
[10] See especially Allesch & Maunz (2000) 203 CLR 172, [40].
In circumstances where the husband did not successfully make out the basis for his application, and I have found that there would be an unacceptable prejudice to the wife, I consider that it would naturally exercise an inexcusable prejudice to other matters in my docket and litigants in this Court generally were I to accede to the husband’s application.
Accordingly, I dismissed the husband’s Application in a Case.
I will also make an order barring the husband from bringing proceedings pursuant to Rule 16.05(2)(a), in circumstances where the husband appeared today and was given the opportunity to make out his application for an adjournment. These circumstances differ from undefended proceedings where a party does not ever appear in the matter. I note also that I flagged this with Ms Snelling at the conclusion of hearing her client’s application.
Material relied upon at undefended hearing
On undefended hearing, the wife sought to rely upon the following material:
a)A Case Outline document emailed to my Associate on 5 November 2020;
b)An Amended Initiating Application filed on 19 October 2020;
c)The wife’s affidavit filed on 15 October 2020;
d)The affidavit of the wife’s mother filed on 15 October 2020;
e)The affidavit of Ms Santo filed on 27 October 2020; and
f)The affidavit of service by Mr F filed on 11 February 2020;
g)The wife’s Financial Statement filed on 15 October 2020;
h)Notice of Address for Service filed by the husband on 30 March 2020;
i)Material tendered to the Court and marked as exhibits, being:
i)Exhibit A1 – Correspondence to Super Fund B between 28 September 2020 and 27 October 2020 principally relating to flagging orders sought by the wife and procedural fairness to the trustee;
ii)Exhibit A2 – Four letters from the wife’s solicitor to Shipton & Associates, the husband’s former solicitors, between 29 May 2019 and 22 July 2019 inter alia seeking financial disclosure;
iii)Exhibit A3 – A statement from Super Fund B (now Super Fund B) dated 28 January 2020 for an account in the husband’s name, indicating a closing balance as at 31 December 2019 of $135,626.37;
iv)Exhibit A4 – A statement indicating the shareholding of the husband as at 11 June 2020 in Company L, indicating a balance of 299 shares (‘the Company L shares’);
v)Exhibit A5 – Payslips for the husband’s employment with Employer M for the period 2020 to 2020, indicating a net pay after tax of $3,032.07 for the pay period;
vi)Exhibit A6 – A vehicle listing for the husband, indicating a holding with a Motor Vehicle 1 and an expired holding with a Motor Vehicle 2;
vii)Exhibit A7 – Registration details for the Motor Vehicle 2 vehicle;
viii)Exhibit A8 – A title search for the C Street, Suburb D property;
ix)Exhibit A9 – A copy of a caveat registered on title to the C Street, Suburb D property in favour of the wife’s mother; and
x)Exhibit A10 – A letter from the wife’s solicitors to her with a notification of costs, that notification not being applicable being per the Family Law Rules 2004 (Cth).
The wife’s Case Outline contained a minute of the orders sought by the wife on an interim and final basis, a Balance Sheet, a chronology, and written submissions including as to costs.
The evidence
The wife was 38 years of age at the time of the undefended hearing. The husband was 40 years of age at the time of the undefended hearing. The parties were married in 2010 and separated under the one roof on 2 December 2018. The husband vacated the former matrimonial home on 26 January 2019.
There are two children of the marriage, X born in 2011 (‘X’) and Y born in 2013 (‘Y), who were nine and seven years of age respectively at the time of the interim hearing.
The husband has re-partnered and resides in Suburb BB.
At the time of the undefended hearing, the children were spending five nights per fortnight with their father and otherwise resided at the former matrimonial home with their mother.
At commencement of cohabitation
At the commencement of cohabitation, the wife asserts that she had the following assets:
a)An interest in a “business” with her mother;
b)A Motor Vehicle “worth about $25,000”; and
c)Some household contents and kitchenware.
The wife asserts that the husband had some Company L shares at the commencement cohabitation.
At the commencement of cohabitation, the wife was working in the business with her mother, where she continued to work until 2009 when the business closed. At the commencement of cohabitation, the husband was working on a full-time basis in undescribed work.
During the relationship
After her business closed in 2009, the wife thereafter worked as an office worker for a company on a part time basis until 2011, a few months prior to the birth of the parties’ first child. The wife did not return to work and the wife cared full-time for the children.
When the wife was in paid employment, she asserts that her income was paid into her own bank account and that she used those moneys to pay her general living expenses, in addition to lifestyle expenses for the husband and herself, such as “outings and entertainment”. After the parties had children, the wife asserts that she used her income to pay for the children’s general living expenses including clothing and extra-curricular activities.
The wife asserts that the husband worked on a full-time basis during the relationship. His income was paid into a bank account in the joint names of the parties, and the funds therein were used for general living expenses inclusive of “rent or mortgage repayments, child-care fees, utilities, groceries, lifestyle and entertainment expenses and bills”.
The parties resided with the wife’s mother between 2010 and 2011. The parties did not pay any rent or contribute to any utilities, on the basis that the parties were saving to purchase their own property.
The parties purchased real property in Suburb AA, New South Wales, in their joint names for $495,000.00 in 2010. The purchase price was entirely funded by way of a registered mortgage with Westpac Banking Corporation, with the wife’s mother being guarantor to the loan.
The wife’s grandmother gifted her $20,000.00 in early 2011 which the wife applied towards renovations to the Suburb AA property, and the parties thereafter moved into the property.
In about 2011, the parties moved into a property inherited by the wife’s mother in C Street, Suburb D. The parties did not pay rent or contribute to any utilities. During this time, the parties leased out their Suburb AA property and the rental income was paid into their joint account.
The wife asserts that she understood that a direct debit was placed on the joint account paying loan repayments towards the Westpac mortgage. The wife since learned that the repayments were “regularly missed and behind, with some repayments not being made at all for a period of time in 2012 and 2013”.
The wife received a redundancy from the company during her maternity leave of approximately $2,500.00. She asserts those funds were used to apply for a credit card to fund the parties’ living expenses.
The wife sold her Motor Vehicle in 2011 for approximately $21,000.00 and used the proceeds towards purchasing a Motor Vehicle 3 in her sole name for about $40,000.00. The balance of the purchase moneys was funded by way of loan.
In 2016, the wife asserts that the husband purchased a Motor Vehicle 2 vehicle and sold the Motor Vehicle 3, forging the wife’s signature on the Notice of Disposal for the sale.
In 2011, the wife asserts that the husband assisted her in creating an online account with Centrelink in order to claim the social services payment commonly known as the baby bonus. At the outset of the account’s creation, the husband’s contact details and email address were provided for the account, and thereafter, the husband attended to advising Centrelink of the family’s estimated income throughout the marriage.
The wife subsequently became aware of a series of debts in her name due to “inaccurate estimates provided by [the husband]”. The wife discovered the first debt in about August 2017 in the sum of $4,486.00, and the wife discovered the second debt in about October 2017 in the sum of $5,136.00. After her discovery in October, the wife changed the contact details of her Centrelink account to her own details, and assumed responsibility for providing the family’s estimated income to Centrelink.
The husband paid off approximately half of the debt using funds from the parties’ joint account, and the wife used her “last two taxation refunds and some of the Family Tax Benefit” she received towards the debt.
The liability is currently valued at $1,752.00 in the Balance Sheet.
In 2013, when Y was approximately nine months old, the parties purchased the C Street, Suburb D property from the wife’s mother. The purchase was in the parties’ joint names for $2,000,000.00 plus other costs of purchase including stamp duty. The parties funded the purchase as follows:
a)A loan of $300,000.00 from the National Australia Bank secured by way of mortgage on the property (‘NAB loan’); and
b)A loan of $1,950,000.00 from the wife’s mother, memorialised in a Loan Agreement dated 3 December 2013. The Loan Agreement was annexed to the wife’s affidavit.
The wife asserts that the funds from the mortgage were used for initial renovations to the C Street, Suburb D property.
The parties sold the Suburb AA property for $510,000.00 in January 2013 and netted $15,000.00 in sale proceeds.
Between December 2013 and 2015, the husband paid the loan repayments to NAB for the C Street, Suburb D property mortgage.
In May 2014, the parties entered into a second loan with NAB secured on the C Street, Suburb D property in the sum of $45,000.00, and used the funds for their general living expenses.
The wife returned to part-time work as a sales representative with Employer Q in 2014, averaging four hours work per week.
In 2016, the parties borrowed a further $46,000.00 from NAB secured by way of mortgage on the C Street, Suburb D property, though the wife was not aware of the existence of the third loan at that time. The wife gives evidence that she has “reviewed the NAB loan statements … and can now see the funds from the third loan were used as follows”:
a)$15,000.00 towards credit card balances for accounts in the husband’s name;
b)$2,181.00 towards the second mortgage secured on the C Street, Suburb D property;
c)$7,945.00 was transferred into NAB accounts in the husband’s sole name;
d)$700.00 towards childcare fees;
e)$3,515.00 towards outstanding utility accounts;
f)$363.00 towards serving costs for the Motor Vehicle 4 in the husband’s sole name;
g)$8,800.00 towards the purchase, cost, and registration of a Motor Vehicle 1 vehicle in the husband’s sole name;
h)$7,000.00 towards the cost of the Motor Vehicle 2 vehicle in the husband’s sole name, and paid to N Finance;
i)$1,200.00 towards a holiday in Country O. The inference on the face of the wife’s evidence is that the parties enjoyed this holiday together; and
j)$3,650.00 withdrawn in cash. The wife asserts she is not aware of how the funds were applied.
The wife deposes that the amount currently owing cumulatively on the NAB loans is approximately $420,000.00.
In about 2017, the wife asserts that the husband received a severance package of approximately $17,218.00 “net”, but that she is unaware of how the husband applied the funds. The husband resumed paid employment in about 2017 as a Manager on a full time basis.
In about September 2017 the wife received a telephone call from NAB. The NAB representative advised the wife that the parties’ loans with NAB were in default and that payments were in arrears by 10 months.
The wife was not aware that the husband had not made the loan repayments for the mortgage, as she understood was the ordinary course of their finances.
The wife confronted the husband with this matter who advised her that he was in discussions with a mortgage broker to refinance the NAB loans and that NAB had been taking the payments from the wrong account.
The wife continued to receive telephone calls from the NAB and two months later the husband had still not refinanced the mortgage as he said he would do.
In December 2017, the wife had a conversation with her mother in which she explained the 10 months of arrears. It is proper to set out the wife’s evidence in relation to this loan in full:
In or about December 2017, I had a conversation with my mother to the following effect:
Me: I received a call from the NAB. Mr Averill has not been paying the loan repayments for the last 10 months. He said that he was refinancing the loan but nothing’s happened and it’s clear that he’s not doing anything about it. NAB is threatening to issue a default notice. I don’t know what to do!
Mother: What has he been doing with the money? How did you not see this?
Me: I just trusted that he would be doing the right thing. He’s always managed our finances.
Mother: Would you like me to lend you the money to pay the outstanding arrears?
Me: Yes please. That would be really helpful
Mother: That is fine. But I want it repaid.
Me: I promise mum.
My mother thereafter loaned me $18,853 to pay the outstanding loan repayments referrable to the mortgage secured on the title to the C Street, Suburb D property.
In the wife’s mother’s affidavit, she deposes:
In 2017, Ms Averill, that [sic] Mr Averill did not have the funds to pay the loan repayments referable to mortgage [sic] secured on the C Street, Suburb D property. I could see Mr Averill was in clear distress about the state of the mortgage and I was worried for his physical wellbeing and mental health. I lent them the funds to pay the mortgage repayments to avoid the loan falling into arrears, with verbal understanding [sic] it was to be paid back. The total amount I lent was $18,853, none of which has been repaid.[11]
[11] Emphasis added.
In the wife’s Financial Statement and on the Balance Sheet, that loan is listed as $18,852.00.
The wife commenced part-time employment with Employer P as an administrative assistant in 2018, in addition to her employment with Employer Q.
The children attend R School and have done so since Kindergarten. The wife’s mother has paid for their school fees and all associated expenses, and she has paid approximately $120,000.00 to date.
The wife asserts that she attended to the majority of the “cooking, cleaning, laundry, grocery shopping, and other domestic duties”. She asserts that the husband “occasionally vacuumed the stairs and bedrooms, mowed the lawns, and assisted with the laundry”.
The wife asserts that she was “primarily responsible” for the care of the children, including feeding them, bathing them, dressing them and changing their nappies, generally attending to their day-to-day needs, taking the children to medical appointments, extracurricular activities and social activities, and taking them to and from school or childcare.
Between 2014 and 2018, the wife studied part-time to become an allied health worker. She continued to deliver the children to childcare or school each morning and collect them in the afternoon and attend to the children’s day-to-day needs.
The wife asserts that the husband and her mother occasionally assisted with the care of the children or with the school commute approximately once or twice each week. The wife asserts that the husband “had little other involvement with the parenting of the children” other than “[playing] with the children often and [assisting] with the children’s dinner time, [assisting at] bedtime by reading them stories, bathing them, and would help [the wife] by putting one of the children to sleep”.
Between 2008 and 2017, the husband worked full time hours abroad and was away from the family home for up to six days every month and for up to two weeks over the Christmas holiday period in the years 2010 to 2017.
Post-separation
The wife has resided at the former matrimonial home with the children since separation.
Between January 2019 and 12 July 2019, the husband paid the loan repayments referable to the mortgage secured on the C Street, Suburb D property. The repayments were approximately $2,040.00 per month, and were paid by the husband depositing moneys into the joint bank account and the repayments were paid from that account. The husband ceased paying monies into the joint account in 12 July 2019.
The husband did not make any child support payments between separation and 19 September 2019. Initially, the wife did not make an application to the Department as the loan repayments the husband was paying were more than the amount of child support as assessed, and she was concerned that he would stop paying the loan repayments if he was assessed to pay child support.
The wife eventually applied for a child support assessment on 15 April 2019. Pursuant to that assessment, the husband was required to pay $259.60 per week for both children. In July 2019, the husband ceased payments towards the NAB loan.
The wife pays for the children’s expenses such as extracurricular activities and clothing. The wife’s mother pays the children’s school fees.
In July 2019, the wife transferred $225.00 to the husband to pay for half of the children’s dance classes for the upcoming term. The husband initially refused to pay for the fees, telling the wife to “use the money from the child support you received. I’m keeping your $225”. The husband did pay the outstanding fees on 14 October 2019.
After separation, the husband retained the Motor Vehicle 1 and the wife used the Motor Vehicle 2 registered in the husband’s name. In about April 2019, the husband requested that the wife return the Motor Vehicle 2 to him, which she did. That vehicle has since been sold for an unknown sum, and appears on the wife’s Balance Sheet as an addback in favour of the husband. The wife is unaware of the sale price or how the sale proceeds were applied by the husband. The husband still retains the Motor Vehicle 1 and the wife uses a vehicle borrowed from her mother.
The wife ceased employment with Employer P in March 2020 due to SARS-CoV-2/COVID-19 and ceased employment as a sales representative for Employer Q in about early 2019.
The husband is employed by Employer M and earns as at 31 August 2020 approximately $144,000.00 per annum.
The wife started a sole trader business entitled Company S in 2019. She earns approximately $83.00 per week.
At the time of the undefended hearing, the children were living with the wife and spending five nights per fortnight with the husband.
The wife deposes that she and the husband are in good health.
The wife’s application
The wife sought an interim superannuation flagging order pending final orders affecting the trustee of the fund with which the husband has superannuation entitlements. I made orders providing for the flagging order pending further order of the Court.
On a final basis, the wife sought orders to the following effect, summarised as follows:
a)Discharge of the interim flagging order;
b)A split of the husband’s superannuation interests as to 88% to the wife and 12% to the husband;
c)That the husband transfer his interest in the C Street, Suburb D property to the wife simultaneous with the wife doing all things to discharge the NAB mortgage secured on title;
d)An injunction on the husband redrawing any joint funds from the NAB account ending #...51 in the parties’ joint names;
e)That the joint accounts be closed and those funds paid to the wife. I note in this order there is an erroneous reference to a Westpac account ending ‘…45’, when the wife’s Financial Statement and the Balance Sheet refer to a Westpac account ending #...54.
f)A transfer of the Motor Vehicle 1 vehicle into the wife’s name;
g)Orders providing for (subject to the orders) the parties to retain monies, insurance policies, vehicles, and entitlements in superannuation funds in their sole name; and
h)An indemnity from the wife to the husband in relation to the liabilities arising from the Deed of Loan, liabilities in the wife’s sole name, and liabilities relating to assets to be retained by the wife pursuant to final orders.
The wife also sought costs of the proceedings, which I will deal with later in these Reasons.
Using the figures as provided in the wife’s Balance Sheet (without having made any findings in relation to same), but updating the subtotals and totals thereof for mathematical accuracy, the effect of these orders would be a split of the matrimonial asset pool inclusive of superannuation as to 78.97% (or $64,300.88) to the wife and 21.03% (or $17,120.12) to the husband.
The issues
On the face of the evidence, it is apparent that the following issues arise for determination by the Court:
a)Whether it is just and equitable to alter the interests of the parties in property;
b)The values of certain items on the Balance Sheet;
c)How to deal with an addback in relation to the Motor Vehicle 2.
The law
Property settlement under section 79 of the Act
The law relating to the alteration of property interests between two parties to a marriage is governed by section 79 of the Act.[12] Relevant in this case, section 79(1) vests the Court with power to alter the interests of the parties in property,[13] and the power to make orders providing for the settlement or transfer of property, as determined by the Court.[14]
[12] Family Law Act 1975 (Cth) s 79.
[13] Family Law Act 1975 (Cth) s 79(1)(a).
[14] Family Law Act 1975 (Cth) s 79(1)(d).
However, the Court must not make an order under section 79 unless the Court is satisfied that, in all of the circumstances, it is just and equitable to do so.[15] The legislative process required by section 79 was considered by the High Court in Stanford & Stanford.[16]
[15] Family Law Act 1975 (Cth) s 79(2).
[16] Stanford & Stanford (2012) 247 CLR 108.
In that decision, the High Court held that section 79(2) requires that at the outset of the Court’s decision-making process the Court must consider whether or not, in all the circumstances, it is just and equitable to make an order under section 79(1) altering the interests of the parties to the marriage in property.
In considering the proposition posed by this first step, a Court should start by identifying items under the following categories:
a)The existing legal and equitable interests of the parties in property, according to ordinary common law and equitable principles;
b)The existing liabilities of the parties, according to ordinary common law and equitable principles and under legislation; and
c)The rights of the parties, if any, according to ordinary common law and equitable principles and under legislation, in relation to any asserted resources of the parties that may, if it is considered just and equitable to proceed with the property settlement, be taken into account in the Court’s consideration of the matters referred to in section 75(2) of the Act, to which section 79(4)(e) directs the Court’s attention.[17]
[17] Stanford & Stanford (2012) 247 CLR 108; see, especially, [37].
That the interests as described above are ‘existing’ is of importance, as the Court noted, because the text of the section gives reference to ‘altering’ the interests.[18]
[18] Stanford & Stanford (2012) 247 CLR 108, [37].
I further note the comments of the High Court in Stanford at paragraph 42 which I reproduce in full here:
In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, 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 marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).[19]
[19] Stanford & Stanford (2012) 247 CLR 108, [42].
I will examine the matrimonial asset pool and the existing interests of the parties, before determining whether it is just and equitable to make a property adjustment order.
If the Court determines that it is just and equitable to make an order under section 79, the Court must then consider what orders are appropriate to be made. In doing so, I will follow the four-step process set out in Hickey & Hickey & Attorney-General for the Commonwealth of Australia.[20]
[20] Hickey & Hickey & Attorney-General for the Commonwealth of Australia (‘Hickey’) [2003] FamCA 395, [39].
In Hickey, the Full Court of the Family Court set out a process of four inter-related steps that must be taken by a court when determining a property application:
a)First, “the Court should make findings as to the identity and value of the property, liabilities, and financial resources of the parties at the date of the hearing”;[21]
b)Second, “the Court should identify and assess the contributions of the parties within the meaning of section 79(4)(a), (b), and (c), and determine the contribution-based entitlements of the parties expressed as a percentage of the net value of the property of the parties”; [22]
c)Third, “the Court should identify and assess the relevant matters … (“the other factors”) including…the matters referred to in section 75(2) so far as they are relevant…”;[23]
d)Fourth, “the Court should … resolve what order is just and equitable in all the circumstances of the case”.[24]
[21] Hickey [2003] FamCA 395, [39].
[22] Hickey [2003] FamCA 395, [39]. See also Family Law Act 1975 (Cth) s 79(4)(a)-(c):
[23] Hickey [2003] FamCA 395, [39].
[24] Hickey [2003] FamCA 395, [39].
The Full Court pointed out in Hickey that pursuant to the wording of section 79, there can only be one property settlement order at any one time, and that the one property settlement order is final, subject only to anything that may be properly done pursuant to section 79A of the Act.[25]
[25] Hickey [2003] FamCA 395, [47].
The Full Court held in Fontana:[26]
… Indeed, the authorities are consistent in finding that assessing contributions is not an accounting exercise but a holistic one (Brandt & Brandt (1997) FLC 92-758; Norbis & Norbis (1986) 161 CLR 513).[27]
[26] Fontana & Fontana [2018] FamCAFC 63.
[27] Fontana & Fontana [2018] FamCAFC 63, [27].
The Court is required to consider the parties’ contributions made on and from the commencement of their relationship, during their relationship, and following separation.[28]
[28] See, eg, Jabour & Jabour [2019] FamCAFC 78.
The approach to determining the appropriate percentage of the net value of property in relation to the contributions of the parties, at step two of the four-step process, requires an assessment of contributions by, or on behalf of, each of the parties in a holistic manner, rather than attaching specific contributions to a specific item of property and making a determination upon that basis. To do the latter would be to disregard the whole of the contributions made during the whole of the relevant period of the relationship by or on behalf of each of the parties.
As the Full Court said in Dickons & Dickons[29] at paragraphs 14 to 16:
[14] As is plain from earlier decisions of this Court, regard must be had to the use made of contributions of various types so as to compare the contributions made by each of the parties during the course of, and over the length of, their relationship (see, for example, In the Marriage of Pierce (1998) FLC 92-844) But that is an entirely different proposition to, as it were, causally linking contributions with their asserted financial “product” or “value”. The former recognises that the nature, form and extent of contributions made by each of the parties might differ; the latter suggests that the absence of a causal link counts as no contribution at all.
[15] The search for a causal link might be seen to come instinctively to the necessary inquiry and all the more so when regard is had to s 79(4)(a) which refers to financial contributions made “...directly or indirectly...” “...to the acquisition, conservation or improvement of any of the property ...” and goes on to also refer to the financial contribution made “...otherwise in relation to any of that last-mentioned property...” The terms of that sub-paragraph might, naturally enough, be seen to suggest a causal link between those contributions and the “financial product” which those contributions of that type are said to have produced. That same requirement might also be seen to suggest that relevant contributions of that type can be seen to be quantifiable – or, at least, conceptualised – in monetary terms, in contradistinction to contributions made pursuant to s 79(4)(c).
[16] While that apparent “causal connection” might be seen in s 79(4)(a) (and (b)), no such connection is apparent from the terms of s 79(4)(c); contributions of that latter type are not linked by the words of the sub-paragraph to the “...acquisition, conservation or improvement of any of the property...” or, indeed, to “property” at all. This is not a legislative oversight; the 1983 amendments to the Act which inserted the current s 79(4)(c) were specifically intended, relevantly, to remove any suggestion that there needed to be a causal link between contributions of that type and any particular asset or property. The Explanatory Memorandum to the Family Law Act Amendment Bill 1983 provides, at Clause 36, that a specific purpose of the re-casting of s 79(4) was, relevantly, to:
... revise sub-section 79(4) to remove the possibility of an interpretation of the sub-section requiring that there be a nexus between a spouse’s contribution and a specific item of property in section 79 proceedings ...[30]
[29] Dickons & Dickons [2012] FamCAFC 154.
[30] Dickons & Dickons [2012] FamCAFC 154, [14]-[16].
The Court is required to make a holistic value judgment in the exercise of a discretionary power of a very general kind.[31] The principle was expressed succinctly by the Full Court in the joint judgment of Bryant CJ and Ainslie-Wallace J in Fields & Smith[32] at paragraph 168:
...the task is to consider the contributions holistically over the whole period from the commencement of cohabitation to trial, and the analysis requires the Court to weight all of the contributions of all types prescribed by section 79(4) made by both parties across the entirety of the relationship until the time of Hearing, including the post-separation period.[33]
[31] In the Marriage of Harris (1991) 104 FLR 458, 464.
[32] Fields & Smith [2015] FamCAFC 57.
[33] Fields & Smith [2015] FamCAFC 57, [168].
The Full Court has been repeatedly clear that the approach to property settlement under section 79 of the Act is not an accounting exercise. Here, I note the comments of the Full Court in Grier & Malphas[34] at paragraph 129, where Murphy and Kent JJ said:
As the Chief Justice points out, with those principles in mind, the trial judge adopted a broad-brush approach to the parties’ respective expenditure. Nowhere error is established by reason alone of that approach; authority eschews “overly pernickety analysis” and section 79 demands neither an audit nor an exercise in accounting. However, when significant sums of money are said by one party or the other to have been “wasted” or to amount to a unilateral “premature distribution of property” and the evidence is suggestive of either or both, an analysis of the relevant sums and their use is needed.[35]
[34] Grier & Malphas (2017) 55 Fam LR 107.
[35] Grier & Malphas (2017) 55 Fam LR 107, [129].
Addbacks
The approach adopted by trial judges to the concept of ‘addbacks’ over the years since the commencement of the Act has varied between placing back into the matrimonial asset pool no-longer existent assets as “notional assets” and giving them a value and dealing with them as if they still existed, to taking any such notional assets into account at step three of the four-step process when considering the matters referred to in section 75(2) of the Act and, in particular, at section 75(2)(o), “Any fact or circumstance which, in the opinion of the Court, the justice of the case requires to be taken into account.”[36]
[36] Family Law Act 1975 (Cth) s 75(2)(o).
In AJO v GRO,[37] commencing at paragraph [30], the Full Court identified three types of addbacks that are commonly encountered in property settlement decisions: expenditure on legal fees, premature distribution of matrimonial assets, and conduct which has reduced the value of matrimonial assets. In particular, I note the comments of the Court in relation to the second of those types:
(b) Where there has been a premature distribution of matrimonial assets. In In Marriage of Townsend (1994) 18 Fam LR 505 Nicholson CJ as he then was with whom Fogarty and Jordan JJ agreed, said (at 509):
In my view, what occurred in this case, as I said during the course of argument was, in fact, a premature distribution of a proportion of the matrimonial assets. What the Husband did was to distribute to himself an asset in which the Wife had a legitimate interest. In such circumstances I consider that it would be unjust in the extreme to simply treat such conduct by the Husband as a matter to which regard should be had under section 75(2). It seems to me that the Husband has had the benefit of that money. Had he retained, for example, the taxi licence instead of selling it, that would have been brought into account as an item of property which would have been dealt with in the same way as the remaining items of property in this case. Accordingly, I am of the view that the correct way in which to deal with the Husband’s receipt of those moneys is to bring them into the pool of assets on a notional basis and make a distribution accordingly.[38]
[37] AJO v GRO (2005) 191 FLR 317.
[38] AJO v GRO (2005) 191 FLR 317, [30].
The Full Court was careful to point out the difference between a “premature distribution” and expenditure on reasonable day-to-day expenses and, in particular, expenditure on reasonable self-support.[39]
[39] See especially, AJO v GRO (2005) 191 FLR 317, [30](b).
I also note the comments of the Full Court in Talbot & Talbot:[40]
Where one party unilaterally distributes to themselves property which no longer exists and which, but for that premature distribution, would be susceptible to section 79 orders, justice and equity may require the Court to take account of the dissipated property by adding it back as against the dissipating party (Townsend & Townsend (1995) FLC 92-569). Whether that should occur, or whether the dissipation should be taken into account pursuant to section 75(2)(o), or indeed at all, are all matters requiring the exercise of a trial judge’s discretion (In the marriage of AD and AC Townsend (1995) FLC 92-569; AJO & GRO; Cerini & Cerini [1998] FamCA 143).[41]
[40] Talbot & Talbot [2015] FamCAFC 132.
[41] Talbot & Talbot [2015] FamCAFC 132, [31].
I refer also to the case of Vass & Vass, [42] in particular at paragraphs 137 to 139, and the decision in Bevan & Bevan[43] and in particular to comments made in obiter by Bryant CJ and Thackray J at paragraph 79.
[42] Vass & Vass [2015] FamCAFC 51.
[43] Bevan v Bevan (2013) 279 FLR 1.
The question of addbacks was again considered by the Full Court in Masoud & Masoud[44] in paragraphs 90 to 99 of that judgment, and in particular at paragraph 97 where the Court said:
[97] … The way in which non-existent property is to be treated remains a matter for judicial discretion (see Townsend & Townsend FLC 92-569) … the provision of an agreed balance sheet providing for the inclusion of notional property would not mandate his Honour’s acceptance of it or that he would treat the notional property in the same way as had the parties.[45]
[44] Masoud & Masoud [2016] FamCAFC 24.
[45] Masoud & Masoud [2016] FamCAFC 24, [97].
In that case, the Full Court held that it was open to the trial judge in the exercise of discretion to deal with asserted addbacks in a manner different to that proposed by either of the parties, or indeed by the parties jointly, as reflected in that case by the treatment of addbacks in an agreed balance sheet.
The Full Court of the Family Court of Australia has provided useful guidelines for adding back to the property available at trial in paragraphs 27 to 47 of Trevi & Trevi,[46] from which I find it of assistance to quote some of those paragraphs in full, with original footnotes:
[46] Trevi & Trevi [2018] FamCAFC 173.
Guidelines for adding back to the property available at trial
(a) Dissipation of property and expenditure other than on legal fees
[27] The Full Court held in AJO and GRO[47] that addbacks fall into “three clear categories”: where the parties have expended money on legal fees; where there has been a premature distribution of matrimonial assets; and “waste” or wanton, negligent, or reckless dissipation of assets.[48]
[28] However, the Full Court also made it clear that an addback does not necessarily occur whenever “a party has expended money realised from the disposition of assets that existed as at the date of separation”, the Full Court describing such a proposition as “unduly simplistic”.[49] An earlier Full Court made the same point, saying that adding back is “the exception rather than the rule”.[50]
[29] The fundamental precept that addbacks are exceptional, reflected in the decisions just referred to, also mirrors what has been said in earlier decisions of the Full Court that, for example, “the Family Court must take the property of a party to the marriage as it finds it”[51] at trial. An important parallel proposition is that the parties do not “go into a state of suspended economic animation” after separation.[52] Thus, reasonably incurred expenditure does not usually come within accepted categories of addback.
[30] Two fundamental premises emerge from AJO & GRO and the authorities preceding it. First, “adding back” is a discretionary exercise. When the discretion is exercised in favour of adding back, it reflects a decision that, exceptionally, in the particular circumstances of a case, justice and equity requires it. The second premise is its corollary: in cases that are not “exceptional” justice and equity can be achieved, not by adding back, but by the exercise of a different discretion – usually by taking up the same as a relevant s 75(2) factor. Indeed, it has been said that the latter is “a course which is, perhaps, technically more correct” than adding back to the list of existing interests in property.[53]
…
[46] In Stanford v Stanford,[54] the High Court emphasised as fundamental that a consideration of whether it is just and equitable to make a property settlement order begins by “identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property”.[55]
[47] The essence of a claim for addbacks is that the asserted sum/s should be added to the value of the existing property interests of the parties and, subsequent to the assessment of contributions, credited to the spending party as part of the value of their assessed entitlements. Doing so does not offend what was emphasised by the High Court. Adding back does not seek to create property interests that do not exist. Rather, doing so emphasises that satisfying the respective requirements of ss 79(2) and (4) of the Act to do justice and equity can require an “accounting” or “balance sheet” exercise for the purposes of s 79(2) and (4), so as to include the value of the dissipated property or expended sums within the total value of the parties’ existing interests in property, and to credit the value of same against the assessed entitlement of the dissipating or spending party.[56]
[47] (2005) FLC 93-218 (‘AJO & GRO).
[48] AJO & GRO at 79,617 [30], referencing in particular Kowaliw and Kowaliw (1981) FLC 91-092 (‘Kowaliw’); Townsend and Townsend (1995) FLC 92-569 (“Townsend”).
[49] AJO & GRO at 79,619 [39].
[50] Cerini & Cerini sub nom C & C [1998] FamCA 143 (‘Cerini’) at [46].
[51] Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337 at 355. See also, Stanford v Stanford (2012) 247 CLR 108.
[52] Marker & Marker sub nom M & M [1998] FamCA 42 at [2.11].
[53] Line and Line (1997) FLC 92-729 at [4.72] as quoted in Chorn at 79,317 [38] (noting that, at [4.71], legal fees were said, in obiter, to be different and there is reference to the “notional property” approach). It has also been said that premature expenditure might be taken up in the assessment of contributions, for example by a party making a disproportionately greater indirect contributions to the existing property by reason of other property having been dissipated (see, Watson & Ling (2013) FLC 93-527 at 86,924 [33]).
[54] (2012) 247 CLR 108 (‘Stanford’).
[55] Stanford at 120 [37] (emphasis in original) (French CJ, Hayne, Kiefel and Bell JJ).
[56] See, eg, Bevan & Bevan (2013) FLC 93-545 at [79]; Vass & Vass (2015) 53 Fam LR 373 and pre‑Stanford statements to similar effect in Milankov & Milankov (2002) FLC 93-095.
The matrimonial asset pool
Annexed to the wife’s Case Outline document is a Balance Sheet with values as contended for by the wife and with a blank column for values as contended for by the husband. In circumstances where the proceedings proceeded on an undefended basis, I have disregarded any contention as to value on behalf of the husband. I have also corrected the asserted total of assets:
| Ownership | Description | Wife’s asserted value | |||
| Assets | |||||
| 1. | J | C Street, Suburb D | $3,400,000.00 | ||
| 2. | J | Westpac account #...54 | $21.00 | ||
| 3. | J | NAB account #...77 | $Nil | ||
| 4. | J | NAB account #...68 | $1.00 | ||
| 5. | J | NAB account #...31 | $29.00 | ||
| 6. | W | NAB account #...86 | $Nil | ||
| 7. | W | CBA account #...15 | $15,000.00 | ||
| 8. | W | Westpac account #...89 | $Nil | ||
| 9. | W | Interest in Company S | $Nil | ||
| 10. | W | Shares in Company T (x1) | $1.00 | ||
| 11. | H | Cash at bank | $Not known | ||
| 12. | H | 299 X Company L Shares @ $2.73/share | $816.00 | ||
| 13. | H | Motor Vehicle 1 | $5,000.00 | ||
| Total | $3,420,868.00 | ||||
| Addbacks | |||||
| 14. | H | Proceeds of sale of Motor Vehicle 2 | $Not known | ||
| Total | $0 | ||||
| Liabilities | |||||
| 15. | J | NAB home loan #...51 | $402,694.00 | ||
| 16. | J | Loan to Ms J | $2,980,000.00 | ||
| 17. | J | Loan to Ms J | $18,852.00 | ||
| 18. | W | Loan to Mr U | $7,600.00 | ||
| 19. | W | AMEX #...09 | $Nil | ||
| 20. | W | Bank V VISA #...73 | $Nil | ||
| 21. | W | Westpac Ignite credit card #...29 | $Nil | ||
| 22. | W | HECS + VET debt | $E 65,000.00 | ||
| 23. | W | Centrelink debt | $E 1,752.00 | ||
| Total | $E3,475,898.00 | ||||
| Superannuation | |||||
| Member | Name of fund | Type of interest | Wife’s value | ||
| 24. | W | Super Fund W | Accumulation | $825.00 | |
| 25. | H | Super Fund B as at 31 December 2019 | Accumulation | $135,626.00 | |
| Total | $136,451.00 | ||||
| Net matrimonial asset pool excluding superannuation | -$55,030.00 | ||||
| Net matrimonial asset pool including superannuation | $81,421.00 | ||||
The C Street, Suburb D property
Annexed to the wife’s affidavit is a market appraisal for the C Street, Suburb D property of $3,400,000.00. That is the basis for the value listed in the wife’s balance sheet.
The opinion provided for in a market appraisal differs from the opinion provided from a licenced property valuer appointed as a single court expert pursuant to the Family Law Rules 2004 (Cth).
I refer here to the case of Frederick & Frederick.[57] While there are some discrepancies in the factual matrix of that case as compared to the current one,[58] the Full Court noted in relation to evidence provided by the Respondent as to the value of certain assets:
As would be apparent from what we have said, the husband’s evidence as to current values was more than conjecture. It had been properly admitted and was entitled to some weight, all the more so in the absence of any other evidence.[59]
[57] Frederick & Frederick [2019] FamCAFC 87.
[58] In that case, the lower court decision related to an application to set aside a Financial Agreement binding upon the parties.
[59] Frederick & Frederick [2019] FamCAFC 87, [41].
In the present case, the market appraisal provided by Z Real Estate dated 13 October 2020 indicates a value in the range of $3,400,000.00 to $3,700,000.00. It indicates that such a range is based on a sale on the property’s current value, and that the appraisal is “[b]ased on research on similar properties”. The appraisal also contains a disclaimer:
Although every care has been taken in arriving at this figure we stress that it is an opinion of reasonable selling price only and is not be construed as a formal valuation …
In the present case, it was open to the wife to adduce evidence from a single court expert, even one appointed in the absence of the husband’s proper participation in these proceedings.
However, in circumstances where the market appraisal gives an indication of value, the basis for such an indication, and it remains the only piece of evidence in the hearing as to valuation, I find that such evidence has sufficient relevance and weight in this matter accepted as to be considered when assessing the proper value of the C Street, Suburb D property.
The wife has selected a value at the lowest end of the range provided for in the valuation. There is no evidence before me from the wife as to why she asserts the property is valued at the lower end of the range.
I find that it is appropriate to accept the evidence provided for in the market appraisal as founding the value contended for by the wife. Accordingly, I find that the C Street, Suburb D property has a value of $3,400,000.00.
The loan with the wife’s mother relating to the C Street, Suburb D property
On 3 December 2013, the parties jointly entered into a Deed of Loan with the wife’s mother. The copy annexed to the wife’s affidavit does not bear a signature from her mother.
The recitals of that loan are in summary as follows:
a)The wife’s mother sold the C Street, Suburb D property to the parties by way of a Contract for Sale for the sum of $2,000,000.00, which was entered into at about the same time as the Deed of Loan.
b)The loan was for the sum of $1,950,000.00 to be applied towards the cost of the purchase price of the property pursuant to the Contract for Sale (that is, no funds changed hands – the wife’s mother credited the parties $1,950,000.00 on settlement of the purchase).
The terms of that loan are in summary as follows:
a)The loan was to be repaid by the parties on the earliest of four dates:
i)30 July 2040;
ii)In the event of a sale of the C Street, Suburb D property, then on the date of completion of the sale;
iii)Upon a date being 30 days from the date of written demand by the wife’s mother to the parties requiring repayment of the said sum; or
iv)“The date of death of the survivor of the [parties]”.
b)The sum to be repaid by the parties to the wife’s mother is to be the greatest of the following:
i)The sum of $1,950,000.00;
ii)In the event of a sale of the C Street, Suburb D property, then the sale price less an amount being 13% of the sale price;
iii)In any other event other than a sale of the property, then an amount equal to the then market value of the property as agreed between the wife’s mother and the parties, and failing agreement, as set by a licensed valuer less 13% of the value.
c)The wife’s mother has first right of refusal to purchase the property back from the parties.
d)Should the wife’s mother decease without having issued a written demand in accordance with the Deed of Loan, then the parties would be released from any obligation to repay the sum.
e)The parties consented to the wife’s mother lodging a caveat over the property.
The loan is expressed as a joint liability in both the Deed of Loan and the Balance Sheet.
The value of the loan is listed in the Balance Sheet as being $2,980,000.00. It is listed in the wife’s Financial Statement as being $2,994,000.00.
I find that the appropriate course to take in ascertaining the proper value of this liability for the purposes of the Balance Sheet is as is provided for in clause 4.3 of the Deed of Loan and as set out in paragraph 8 of the wife’s mother’s affidavit. In circumstances where the property is deemed to be valued $3,400,000.00, the proper value to assign to this debt is $2,958,000.00.
Accordingly, I find that the parties’ loan with the wife’s mother is a joint liability in the value of $2,958,000.00.
The loan with the wife’s mother for mortgage arrears
The wife’s mother loaned the parties funds to pay outstanding arrears on the NAB loans secured by mortgage on the C Street, Suburb D property in December 2017.
In the wife’s affidavit and the affidavit of her mother, that loan is listed as $18,853.00. In the wife’s Financial Statement and Case Outline, that loan is listed as $18,852.00.
In the absence of any further evidence on the matter, and noting that this a small matter of discrepancy in the evidence, I find that the proper value to assign this liability is $18,853.00.
Furthermore, notwithstanding the phraseology used in the wife’s affidavit, I accept the evidence of the wife’s mother and I find that the liability is a joint liability of the parties.
The Motor Vehicle 1
The Motor Vehicle 1, currently in the possession and control of the husband, is valued at $5,000.00 on the Balance Sheet. Exhibit A6 was tendered into evidence in support of this item on the Balance Sheet.
Exhibit A6 is a Vehicle Listing as at 2 November 2020 for the husband bearing his employer’s logo. At its youngest, the vehicle is a 2011 model, noting the Compliance Plate date is August 2011.
I take judicial notice of the fact that the “Buyer Declared Value” referred to on the document relates to the duty and taxes paid on purchase of a vehicle, rather than its value on the marketplace. Accordingly, I do not take into account the “Buyer Declared Value” as being indicative of the vehicle’s market value.
In the absence of other evidence that would assist me in ascertaining the value of the vehicle, I find that the value of $5,000.00 is appropriate.
The husband’s cash
There is a line item described as the husbands “cash at bank” with an unknown value.
I find that there is not enough evidence to establish a value for the purposes of including this asserted addback on the Balance Sheet. Accordingly, I will not include this line item on the Balance Sheet.
Addback of the proceeds of sale of the Motor Vehicle 2 vehicle
The wife proposes that the proceeds of sale received by the husband to the exclusion of the wife upon the sale of the Motor Vehicle 2 vehicle should be added back as a distribution provided to the husband.
The addback is given the value ‘not known’ on the Balance Sheet. I am not provided with any valuation evidence in order to ascertain the value of the proceeds of sale received by the husband.
Exhibit A7 assists me in finding that such a sale did in fact occur, noting that the vehicle is listed as having been disposed on 27 June 2019.
I find that there is not enough evidence to establish the value of such an addback. Exercising the discretion noted by the Full Court in Trevi, I will not include the proceeds of the sale of the Motor Vehicle 2 on the Balance Sheet.
Items on the Balance Sheet with estimated values
For completeness, I am minded to accept the values provided for in the Balance Sheet where estimated.
What are the existing legal and equitable interests of the parties in the property?
I find that the existing legal and equitable interests of the parties are as reflected in the following Balance Sheet:
| Ownership | Description | Wife’s asserted value | |||
| Assets | |||||
| 1. | J | C Street, Suburb D | $3,400,000.00 | ||
| 2. | J | Westpac account #...54 | $21.00 | ||
| 3. | J | NAB account #...77 | $Nil | ||
| 4. | J | NAB account #...68 | $1.00 | ||
| 5. | J | NAB account #...31 | $29.00 | ||
| 6. | W | NAB account #...86 | $Nil | ||
| 7. | W | CBA account #...15 | $15,000.00 | ||
| 8. | W | Westpac account #...89 | $Nil | ||
| 9. | W | Interest in Z Real Estate | $Nil | ||
| 10. | W | Shares in Company T (x1) | $1.00 | ||
| 12. | H | 299 X Company L Shares @ $2.73/share | $816.00 | ||
| 13. | H | Motor Vehicle 1 | $5,000.00 | ||
| Total | $3,420,868.00 | ||||
| Liabilities | |||||
| 15. | J | NAB home loan #...51 | $402,694.00 | ||
| 16. | J | Loan to Ms J | $2,958,000.00 | ||
| 17. | J | Loan to Ms J | $18,853.00 | ||
| 18. | W | Loan to Mr U | $7,600.00 | ||
| 19. | W | AMEX #...09 | $Nil | ||
| 20. | W | Bank V VISA #...73 | $Nil | ||
| 21. | W | Westpac Ignite credit card #...29 | $Nil | ||
| 22. | W | HECS + VET debt | $65,000.00 | ||
| 23. | W | Centrelink debt | $1,752.00 | ||
| Total | $3,453,899.00 | ||||
| Superannuation | |||||
| Member | Name of fund | Type of interest | Wife’s value | ||
| 24. | W | Super Fund W | Accumulation | $825.00 | |
| 25. | H | Super Fund B as at 31 December 2019 | Accumulation | $135,626.00 | |
| Total | $136,451.00 | ||||
| Net matrimonial asset pool excluding superannuation | -$33,031.00 | ||||
| Net matrimonial asset pool including superannuation | $103,420.00 | ||||
Is it just and equitable to make an order under section 79?
In this matter, the parties are divorced which has ended their marital relationship at law. It is settled law that the act of entering into a marriage does not, itself, invest either party to the marriage with an interest at law or in equity in the property of the other party to the marriage.[60]
[60] Hepworth v Hepworth (1963) 110 CLR 309; see also Stanford & Stanford (2012) 247 CLR 108, [39]; Chancellor & McCoy [2016] FamCAFC 256.
Were the Court to not find it is just and equitable to make an order under section 79, in addition to remaining undesirably linked in their finances, the net value of the assets, liabilities, and superannuation in the wife’s sole name would be -$58,526.00, whereas the husband would be left with net assets in his name and his superannuation, totalling $141,442.00, a sum that exceeds the value of the net asset pool ($103,420.00) by $38,022.00.
Accordingly, I find that it is just and equitable in all the circumstances to make an order under section 79 of the Act, effecting a property settlement between these parties.
Contributions
Financial contributions
At the commencement of the relationship, the wife had a vehicle worth about $25,000.00, an interest of an unknown value in a business together with her mother, and some household contents. At the commencement of the relationship, the husband had some shares with Company L. The value of those shares is unknown.
I find that at the commencement of the parties’ relationship, the wife made a slightly greater financial contribution than the husband.
During the majority of the relationship, the husband worked full time and applied his income to the welfare of the family. The wife worked intermittently during the relationship and whatever income she derived was applied to the living expenses of the family.
Several contributions were made to the parties by the wife’s mother, including:
a)Allowing the parties to reside with her for a year in 2010 and 2011, without paying any rent or making contributions to utilities;
b)Guaranteeing the parties’ loan with Westpac Banking Corporation secured by way of mortgage on real property in Suburb AA in 2010;
c)In 2011, allowing the parties to move into real property inherited by the wife’s mother in C Street, Suburb D, without them being required to pay rent or contribute to utilities. During this time, the parties were able to lease out their property at Suburb AA and receive rental income;
d)Significantly, selling to the parties the C Street, Suburb D property for $2,000,000.00 and entering into a Deed of Loan with favourable terms, inclusive of an advance of funds of $1,950,000.00;
e)Extending the parties a loan of $18,853.00 to pay arrears on the mortgage secured on the C Street, Suburb D property;
f)Paying for the children’s school fees for their attendance at R School.
I am mindful of the general rule that gifts made by a parent of a party are taken to be a contribution made by or on behalf of the party who is the child of the parent, unless there is evidence which establishes it was not the intention of the parent to benefit only their child.[61] Thus, whether, a gift should be taken as having been intended to benefit one party alone depends on the intention of the giftor at the time of its transfer.[62]
[61] Kessey & Kessey (1994) 18 Fam LR 149.
[62] Mabb & Mabb & Anor [2020] FamCAFC 18, [35].
In the wife’s mother’s affidavit, she expresses her intention as to the provision of those financial contributions as being contributions for the benefit of both parties, and not just the wife.
Accordingly, I find that the significant contributions made by the wife’s mother are contributions that were made for the joint benefit of the parties.
Notwithstanding the substantial financial contributions made for the joint benefit of the parties by the wife’s mother, I find that the husband made a slightly greater financial contribution by reason of his income from his consistent full-time employment.
Contributions to the welfare of the family
During the relationship, the wife was the primary homemaker and primary carer of the children, the husband being engaged in full-time employment during the parties’ marriage. The husband also engaged in caring for the children and upkeep of the home at times when he was not at work.
I find that the wife made the greater contribution to the welfare of the family.
Accordingly, I find that contributions favour the wife as to 55% and the husband as to 45%, a differential of 10%.
The effect of any proposed order upon the earning capacity of a party
I do not find that there is likely to be any impact of the orders upon the earning capacity of a party.
Section 75(2) factors
As far as the Court is aware, the parties are each in decent health.
The evidence of the parties’ respective incomes and the asset pool is set out above, along with the parties’ capacity for appropriate gainful employment. The wife has a lesser capacity to engage in gainful employment, and a significantly lower income and earning capacity than the husband.[63] I order that there is an adjustment to be made in favour of the wife for this consideration.
[63] Family Law Act 1975 (Cth) s 75(2)(o).
The wife has the primary care and control of the children, though noting that the father spends five nights per fortnight with the children. I consider that there is an adjustment to be made in favour of the wife based upon this consideration.
The Court does not have any evidence of the husband’s obligations to support himself or any other person, aside from the evidence of the wife of the husband’s expenditure of some joint moneys for personal use. The Court is equipped with evidence in relation to the wife’s responsibilities for the care of the children.
The wife is entitled to and receives benefits by way of JobSeeker, parenting payment, and the Family Tax Benefit from Centrelink under the laws of the Commonwealth. There is no evidence that the husband receives any known pension, allowance, or benefit.
The Court has not been provided with any evidence relating to the parties’ respective standards of living, aside from the wife residing in the former matrimonial home. Nothing turns on this consideration.
I do not find that making orders in the manner favoured by the wife would have an appreciable effect upon the capacity of any particular creditor to recover the debt.
I find that the wife in her capacity as homemaker and primary carer for the parties’ children has contributed to the husband’s earning capacity. Moreover, I find that the duration of the marriage has negatively affected the wife’s earning capacity.
The Court is advised that the wife will continue to be the children’s primary carer.
Finally, I do not consider that there is any other fact or circumstances which, in the opinion of the Court, the justice of the case requires to be taken into account.
Matters relating to child support
The husband is assessed to pay child support to the wife. I do not consider that this has any bearing upon an order proper to be made in the interests of the justice and equity of the case.
Accordingly I find that there should be an adjustment of 10% in favour of the wife, that being equal to $10,342.00 of the of the net asset pool including superannuation.
What orders under section 79 are appropriate to be made?
I find that it is appropriate to make an order adjusting the property interests between the parties as to 65% to the wife and 35% to the husband.
Accordingly I make the orders as set out at the commencement of these Reasons.
The wife’s application for costs
As I foreshadowed during the undefended hearing, I intend to allow the wife and the husband an opportunity to make written submissions in relation to the wife’s application for costs as set out in her Case Outline.
That application provides a primary position and a secondary position:
a)That the husband pay the wife’s costs on the indemnity basis in the sum of $17,900.00; and in the alternative,
b)The husband pay the wife’s costs in the sum of $7,631.00.
Having now made orders on the wife’s application, I intend to make orders allowing the parties to file and serve any affidavit going to matters of evidence relevant to the Court’s consideration. I will also make orders allowing the parties to file and serve written submissions on this matter, following the filing of evidence.
I certify that the preceding two hundred and fourteen paragraphs are a true copy of the reasons for judgment of Judge Morley
Associate:
Date: 7 July 2021
(4) In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(a) the financial contribution made directly or indirectly by or on behalf of a party …
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party …;
(c) the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage … including any contribution made in the capacity of homemaker or parent; …
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