Basra and Ahmed and Anor
[2016] FamCA 838
•30 September 2016
FAMILY COURT OF AUSTRALIA
| BASRA & AHMED AND ANOR | [2016] FamCA 838 |
FAMILY LAW – DIVORCE – Where the wife makes an Application for Divorce – Where the husband opposes the divorce order on the basis that the parties have already been divorced in Lebanon – Where the purported divorce of the parties’ marriage in Lebanon should not be recognised on the ground that the wife had been denied natural policy (s 104(4) Family Law Act 1975 (Cth) (“the Act”) – Where the husband’s Response to the wife’s application for divorce is dismissed – Where the wife’s application for a divorce order is granted.
FAMILY LAW – PROPERTY – Where the second respondent relies upon accrued jurisdiction to seek an order that the wife repay him $400,000 as payment for the loan between them evidenced in a deed – Where the wife denies signing the deed – Where the wife’s evidence is favoured over that of the second respondent – Where the contract contained in the deed must fail.
FAMLY LAW – PROPERTY –Where the husband asserts he made 100 per cent of the financial contributions associated with the acquisition of the parties’ principle asset – Where the wife has made the majority of contributions in the role of homemaker and parent – Where the husband has not made a full and frank disclosure about the assets which he holds and the financial arrangements between the husband, his brothers and his cousin are not clear – Where it is found that contributions to the assets should be divided 50 per cent but the wife should receive a 15 per cent adjustment based upon s 79(4)(d)-(g) factors.
Family Law Act 1975 (Cth)
Marriage Act 1961 (Cth)
Biltoft & Biltoft (1995) FLC 92-614
Black & Kellner (1992) FLC 92-287
Jones v Dunkel (1959) 101 CLR 298
Kennon v Kennon (1997) FLC 92-757
Weir & Weir (1993) FLC 92-338
| APPLICANT: | Ms Basra |
| RESPONDENT: | Mr Ahmed |
| INTERVENOR: | Mr O Ahmed |
| FILE NUMBER: | SYC | 5355 | of | 2013 |
| DATE DELIVERED: | 30 September 2016 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Watts J |
| HEARING DATE: | 29 August 2016 - 2 September 2016 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Gilbert |
| SOLICITOR FOR THE APPLICANT: | Jordan Djundja Lawyers |
| COUNSEL FOR THE RESPONDENT: | Ms Bateman |
| SOLICITOR FOR THE RESPONDENT: | Litigant in person |
| COUNSEL FOR THE 2ND RESPONDENT: | Mr Blank |
| SOLICITOR FOR THE 2ND RESPONDENT: | Yakenian Solicitors |
Orders
ORDERS made 2 September 2016
The husband is not to sell, encumber, mortgage, lease, use as collateral, or in any way deal with the property at G Street, Suburb H without the wife’s written consent or further order of this court.
ORDERS AND FINDINGS made 30 August 2016
The husband’s Response to Divorce filed 29 October 2013 be dismissed.
In relation to the wife’s Application for Divorce filed on13 September 2013, I find that the parties were married at District K, Lebanon in July 1997. I find that the applicant/wife is domiciled in Australia and ordinarily resident in Australia for a period not less than 12 months prior to the date of the filing of the application. I find that as at the date of the filing by the wife of her application for a divorce order, namely 13 September 2013, the parties had separated no later than 11 August 2012 and thereafter lived separately and apart for a period in excess of 12 months and that the marriage of the husband and wife has broken down irretrievably.
There are two children of the marriage under the age of 18, C born … 2001 and D born … 2008. I find that proper arrangements in all the circumstances have been made for the care, welfare and development of those children.
I therefore make a Divorce Order as sought in the Application.
The Divorce Order will take effect one month from today.
I reserve my reasons for making orders and findings in paragraphs 1 – 5 above.
ORDERS
The 2nd respondent’s Response to Initiating Application filed 1 October 2015 be dismissed.
Rule 14.07 Family Law Rules, which requires formal written notice to be given to Ms A, is dispensed with.
Pursuant to s 79 Family Law Act 1975 (Cth) (“the Act”), orders be made in accordance with paragraphs 4 to 11 hereof.
Within a period of two (2) months, the husband pay to the wife the sum of $690,425.
Contemporaneously with the payment referred to in the paragraph 3, the wife transfer to the husband the whole of her right, title and interest in the property situated at G Street, Suburb H (“the H property”) being the whole of the land comprised on Folio Identifier … and for that purpose the husband deliver to the wife a transfer of the H property, in registerable form and the wife execute and deliver that transfer to the husband.
In the event that the husband fails to make the payment referred to in paragraph 3, both parties do all things and sign all necessary documents to list the H property for sale by private treaty at a price to be agreed upon between the parties and failing agreement initially at a sum of $990,800 and if the property has not sold within a period of three (3) months then the property is to be sold for such sum as may be advised from time to time by the agent appointed by the parties to assist in the selling of the property.
The husband and wife are to confer to attempt to agree on a lawyer and on an agent to provide their professional services to facilitate the sale of the H property and in the event that the parties are unable to agree within a period of 14 days in respect of a lawyer and/or an agent, then the wife is to provide a list of three lawyers and/or three agents and the husband is within a 14 day period, to select one of those lawyers and/or one of those agents.
In the event that he fails to do so, the wife will be at liberty to inform the husband in writing as to which lawyer and/or which agent she selects.
The net proceeds of the sale of H property, after payment of normal adjustments and professional costs on the sale and the husband’s land tax debt in the approximate sum of $9,038, shall be divided as to 690,425/990,800 to the wife and 300,375/990,800 to the husband.
The husband is to indemnify the wife in relation to any debts to the following persons:
10.1.Ms A;
10.2.Mr O Ahmed;
10.3.Mr U Ahmed;
10.4.X Building Supplies; and
10.5.Mr L.
Each party be solely entitled to the exclusion of the other to all other property, assets, chattels and superannuation in their respective names or possession as at the date of these orders and that each party indemnify the other in relation to any debt associated with any asset that is kept by each of them respectively.
If either party refuses or neglects to sign (within fourteen (14) days of a written request to do so) any documents necessary to effect the terms of these Orders, the Registrar of the Sydney Registry of the Family Court of Australia is hereby appointed pursuant to the provisions of Section 106A of the Act to execute such documents on behalf of such party.
Either party may apply on 21 days’ notice in respect of the implementation of these orders.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Basra & Ahmed and Anor has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYC 5355 of 2013
| Ms Basra |
Applicant
And
| Mr Ahmed |
1st Respondent
And
| Mr O Ahmed |
2nd Respondent
REASONS FOR JUDGMENT
APPLICATION FOR DIVORCE
On 30 August 2016 I dismissed the husband’s Response to Divorce filed 29 October 2013 and made a divorce order based upon the wife’s application filed 13 September 2013. I reserved my reasons for doing so and now provide those reasons.
The wife filed an Application for Divorce on 13 September 2013. That application asserted that the parties had been married in an Islamic ceremony in July 1997 at District K, the Lebanese Republic (“Lebanon”). The wife says the parties were married on this day in Lebanon. The husband says that the parties married under Islamic law in Australia before an Imam and that that marriage was registered in Lebanon. No attention was given to this difference in the evidence and the matter proceeded on the basis that a valid marriage was solemnised in Lebanon in July 1997. The wife filed an extract from the marriage certificate issued by the Directorate-General of Civil Status. Sections 88C and 88D of The Marriage Act 1961 (Cth) (“the Marriage Act”) provide that in relation to a marriage solemnised in a foreign country, where that marriage is recognised as valid in that foreign country under local law, that marriage shall be recognised in Australia as valid. There was no issue that the parties’ marriage was recognised as valid in Lebanon and consequently it is to be recognised in Australia as valid.
The husband filed a Response to Divorce on 29 October 2013 opposing a divorce order being made on the basis that the parties had already been divorced in Lebanon on 8 June 2009.
The documents relied upon by each party are of some volume, but only particular parts of them are relevant to the central issues that need to be decided. The documents relied upon by the wife and the husband in relation to the divorce application are set out in Schedule 1 and Schedule 2 respectively.
The evidence of Sheikh M was read by me but very little weight can be given to it given that the husband had not organised for the Sheikh to be available for cross examination and an application made on the second day of the hearing for him to give evidence by electronic means from Lebanon was unsuccessful.
The parties separated between late 2003 and late 2004. The parties had previously undergone a divorce under Islamic Law in Australia in 2003 before Sheikh Y. They underwent a second Islamic marriage under Islamic Law in Australia in about 2005. Both parties agreed that these events were not relevant to whether the 2009 divorce should be recognised. It was agreed that the 2003 divorce could not be recognised and that the subsequent Islamic marriage also had no validity in Australian law.
The husband says an Islamic divorce of his marriage to the wife took place on 20 May 2009 on the porch of the parties’ house at N Street, Suburb P (“the P property”). It is the husband’s case that Sheikh M met with a number of men on the porch of the P property who had gathered to witness the divorce. Among them were Mr Q and Mr R. There were one or two other men present. It is the husband’s case that the Sheikh had a discussion with the wife when she walked outside onto the porch:
7.1.Asking her whether or not she wanted a divorce;
7.2.Asking her whether or not she understood her entitlements under an Islamic divorce; and
7.3.Identifying her by way of driver’s licence.
It is the husband’s case that after this conversation took place he divorced his wife by uttering the words “I divorce you” in front of the men on the porch.
The husband says that both he and the wife signed the Statement of Islamic divorce and that Mr Q and Mr R also signed the document which the Sheikh witnessed on that day.
The affidavit of Sheikh M (which has not been able to be tested) indicates that once an Islamic divorce has taken place in Australia and a divorce certificate issued, that person is entitled to lodge that divorce certificate with the Family Court in Lebanon.
The Sheikh says:
It is a condition of the granting of a divorce in the Family Court in Lebanon that I [sic] man has complied with his legal obligations to pay the agreed dowry under the marriage contract and specific proof would need to be provided to the court that such payment had been made.
The wife denies that she was ever spoken to by Sheikh M on 20 May 2009. The wife has annexed to her affidavit of 9 January 2014 a copy of a document entitled Statement of Islamic divorce dated 20 May 2009. That document bears the signature of the husband and Mr Q and apparently also bears the signature of SheikhM and Mr R.
The document also purports to bear the signature of the wife. Discussion took place during the hearing as to whether or not there was an apparent lack of similarity between the signature purporting to be that of the wife on the Statement of Islamic divorce and the large number of signatures contained on multiple affidavits filed by the wife in these proceedings. Mr Q was shown the signature on the Statement of Islamic divorce and one signature on one page of one of the wife’s affidavits and asked to compare them. He expressed the opinion that the two signatures looked very similar.
Counsel for the husband submitted that it would have been open to the wife to seek leave to have the signatures examined by a single forensic handwriting expert but she had not done so. Counsel for the husband submitted that it would be unsafe to make any finding based upon any apparent lack of similarity between signatures and I do not do so.
The wife has given evidence that it is not her signature.
Mr Q, one of the two witnesses who signed the Statement of Islamic divorce, gave evidence. He has been a personal friend of the husband for over 20 years. He would often attend the porch of the husband’s property to have coffee with the husband, usually served by the wife. He says that he remembers in mid-2009 receiving a call from the husband who asked him to come over to the property in the early evening in order to be a witness to a divorce by an Islamic Iman. He says he remembers the wife being there; the Iman inquiring about the possibility of a reconciliation and advising the parties against entering into a divorce lightly as there were children involved. He asserts that he remembers there being some discussion about the payment of an amount of money by the husband to the wife and then he recalled the Iman filling out the document which he then signed. In oral evidence he said that he remembered the wife signing the document.
The husband has failed to call evidence from the other witness to the document or the other men who were on the porch on 20 May 2009. As already mentioned, the husband failed to arrange to have Sheikh M available for cross examination.
The wife says she became aware of the husband’s claims about the event on 20 May 2009 after she received the husband’s Response to her Application for a Divorce Order. The wife says that on 31 December 2013 she confronted Sheikh M at his office and that he did not recognise her. In his affidavit, the Sheikh implicitly concedes that is so but says that that is not decisive or determinative because four years had passed and his meeting with her in 2009 had been fleeting.
As will become apparent, it is not necessary for me to make conclusive findings in respect of whether or not there was a valid Islamic divorce in Australia on 20 May 2009. Any such divorce is not a divorce that would be recognised under Australian law. I am comfortably satisfied however that a document entitled “Statement of Islamic divorce” was brought into existence on 20 May 2009.
The husband and wife travelled together to Lebanon in early June 2009 to resettle the wife and the parties’ children at the husband’s father’s residence in District K. The husband says that one of the first things he did when he arrived in Lebanon on 2 June 2009 was to make an appointment to see a Religious Judge from the Islamic Judicial Court in North Lebanon by the name of Judge Sheikh Osama Abdel-Razzak El-Refaei. The husband said that an appointment was scheduled for 8 June 2009. The husband then gives the following evidence:
I further recall at that appointment I informed the Judge that I had divorced Islamically my wife … in Australia before Sheikh [M] and I recall words to the following effect:
Judge: “In order for me to grant you the divorce in Lebanon you will need to provide me with a divorce agreement showing that [the wife] has received her Islamic rights under the marriage contract.”
I said:“I have not brought with me the certificate of divorce issued by Sheikh [M] in Australia but [the wife] is here in Lebanon and you can call her or bring her in to confirm she had received her rights under Islamic law.”
Judge:“I will grant and confirm your divorce once I have received a certified copy from Sheikh [M] which has been endorsed by the Lebanese Embassy or Consulate. I will make a note on my diary that I will grant you an interim divorce subject to you providing me with the certified divorce from Australia. [The husband’s given name] Islamically she is no longer your wife you cannot touch or have any sexual relations with her unless you both decide to remarry. You must continue to support the children financially so long as she is caring for them.”
There is no evidence from the husband that he subsequently provided to Sheikh El-Refaei a certified copy of the document signed by Sheikh M in Australia but given what is in the 2013 divorce order set out below, I infer at some stage the husband did do that.
It is an agreed fact that the amount talked about by way of the wife’s entitlement under the Islamic marriage contract was $100,000.
One immediate problem with the husband’s case is that the wife says that at no time was an amount of $100,000 transferred to her by the husband. She agrees she did have access to a joint account with the husband in Lebanon which had sufficient funds in it for her to be able to draw $1,500 per month (and later $3,000 per month) for her and the children’s living expenses and it was not until 2010 that a sum of about $200,000 was transferred to the account. She denies that she used those funds for anything other than living expenses for herself and the children. The wife disputes that as at 8 June 2009 she had been paid the $100,000. The husband called no evidence that would indicate that the wife withdrew $100,000 from a joint account at any time. I find that as at 8 June 2009 the wife had not received nor at any subsequent time did she receive, the sum of $100,000.
The husband gave conflicting evidence as to whether or not he received any document from Sheikh El-Refaei on 8 June 2009 and whether or not he brought that document to the wife’s attention. He asserted originally that the first time that he sought to obtain any official record of what had happened before Sheikh El-Refaei on 8 June 2009 was after he had been served with the wife’s divorce application in 2013. Later in his evidence he said that he had received a document, that the wife had been given either the original or a copy of that document and that she had destroyed it. This inconsistency in his evidence gave me concern about how much I could rely upon what the husband was saying happened.
The husband was served with the wife’s divorce application on 30 September 2013. The husband then arranged, pursuant to a power of attorney, to have a person in Lebanon register the Islamic divorce. The result was the creation of a document in the following form (as translated).
EXTRACT TRANSLATIONOF DIVORCE ORDER
Country of origin: Lebanon Issuing Authority Lebanese Republic – Ministry of Interior and Municipalities – General Directorate for Personal Affairs – [K] Religious Court Name of document Divorce Document Registration: This document was issued by the Court under no:376 dated 21/10/2013 Legal basis [K] Religious Court; Decision to Confirm Divorce issued on 08/06/2009 Date of issue: 21/10/2013/ By head of Court Registry/ Sheikh/ [W] – signature Date of marriage: Not stated Date of Divorce: 20/05/2009 Type of Divorce First absolute Divorce Officiating Judge Religious Judge of [District K]: Sheikh/ Osama Abdel-Razzak El-Refaei DIVORCED DIVORCED Full name [Mr Ahmed] [Ms Basra] Place and date of birth [District K]/…1969 Sydney/Australia/…1978 Mother’s name … … Religion Muslim Sunni Muslin Shiite Main Registration Locality of: …/ District of [K] / Reg.No: 28 Locality of: …i/ District of [K] / Reg.No: 28 Seals and signatures Of the judge, and octagonal seal of the Court
It is to be noted that the divorce order says that the date of the divorce was 20 May 2009 (the date of the event in Australia on the porch of the P property). The document described what happened in Lebanon on 8 June 2009 as a “Decision to Confirm Divorce”.
I conclude that the husband’s statement that Sheikh El-Refaei said to him on 8 June 2009 “I will grant and confirm your divorce…” is an embellishment by either the husband (or his lawyer) adding the words, “grant and” and the husband swearing those were the words Sheikh El-Refaei used.
I also find that what the husband did on 8 June 2009 was done by him alone and without involvement of the wife.
The husband and his subsequent ‘wife’, Ms A, married. The husband’s evidence in relation to his marriage to his second wife is not all that clear. The husband said they had undergone an Islamic ceremony of marriage at the P property. At a subsequent point in his evidence, the husband said that he and Ms A had married in Lebanon in July 2012. That marriage would not be recognised in Australia if the husband’s asserted divorce to his first wife was not recognised as valid in Australia because he would still be married to another woman (see s 88D(2)(a) of the Marriage Act). The husband says that at a time when he was in Australia, he has divorced his second wife under Islamic Law over the telephone through the use of a lawyer in Lebanon who acted with his power of attorney. The husband and the second wife had a child.
The wife produced a search from the Ministry of Interior and Municipalities Directorate General of Civil Status Affairs (which is the Republic of Lebanon’s equivalent to our Registry of Births, Deaths and Marriages). The family extract of that registration as at 21 December 2013 recorded the husband being married to two women, namely the wife and Ms A. The husband makes an assertion that this document is a forgery but I have no reason to believe that it is. There is however no explanation as to how that official record is consistent with the divorce order that the husband obtained on 21 October 2013, set out above.
Applicable Law
Section 104(3) Family Law Act 1975 (Cth) (“the Act”), provides:
(3) A divorce … effected in accordance with the law of an overseas jurisdiction shall be recognized as valid in Australia where:
(a) the respondent was ordinarily resident in the overseas jurisdiction at the relevant date;
It is agreed that none of the other subparagraphs of s 104(3) of the Act have any applicability in the facts of this case.
Section 104(1) of the Act defines ‘relevant date’ in s 104 as meaning:
“relevant date”, in relation to a divorce … of the parties to a marriage, means the date of the institution of the proceedings that resulted in the divorce …
Proceedings are defined in s 4 of the Act as meaning a proceeding in a court, whether between parties or not, and includes cross-proceedings or an incidental proceeding in the course of or in connection with a proceeding.
Section 104(4) of the Act provides:
(4) A divorce … of the parties to a marriage, shall not be recognized as valid by virtue of subsection (3) where:
(a) under the common law rules of private international law, recognition of its validity would be refused on the ground that a party to the marriage had been denied natural justice; or
(b) recognition would manifestly be contrary to public policy.
In this case it is an agreed fact that the wife was not ordinarily resident in Lebanon on 20 May 2009 but that she was ordinarily resident in Lebanon on 8 June 2009, having travelled to Lebanon on 2 June 2009, on her version, at the request of the husband to provide assistance to the husband’s father following the death of the husband’s mother. She stayed in Lebanon with the children from 2009 to 2012.
Counsel for the wife submitted that what happened on the porch at the P property on the husband’s version could be considered to be “proceedings” leading to an Islamic divorce but that that divorce would not be recognised in Australia because the wife was resident in Australia at the time. That submission seemed to be predicated on the notion that what happened in Australia on 20 May 2009 and in Lebanon on 8 June 2009 was the same process, namely a process conducted by a Sheikh under Islamic law aimed at divorcing the husband and wife under that law. I do not accept the two processes were the same. I am not persuaded that what happened on the porch at the P property on 20 May 2009 could be described as “proceedings in a court” as required by the definition of proceedings in s 4 of the Act.
The focus then turns to what happened before Sheikh El-Refaei in the K Religious Court on 8 June 2009. The wife was in Lebanon at that time and, if in fact a “divorce” was effected in accordance with the law of an overseas jurisdiction on 8 June 2009, the provisions of s 104(3)(a) of the Act are satisfied and subject to s 104(4) the divorce would be recognised as valid in Australia.
It is not controversial that the wife was not involved in any way in what happened at the Religious Court on 8 June 2009.
There may be an issue as to whether or not what happened in the Religious Court on 8 June 2009 could be correctly described as “proceedings” in a court. I do not have the advantage of any expert evidence. It is not necessary to decide that question.
Also, arguably there was no granting of a divorce by the Lebanese court but simply the confirmation of the Islamic divorce that the husband claimed had taken place in Australia based upon the document which the wife now disputes as being authentic. Again I do not have to decide that question.
I have already mentioned the wife did not receive what was said to be her entitlement under the marriage contract in the sum of $100,000.
Counsel for the husband was invited to make submissions about why I would not find the wife was denied natural justice in respect of what the husband said happened on 8 June 2009 but was unable to make any cogent argument in response.
I conclude any recognition of the validity of what happened in the K Religious Court on 8 June 2009 should be refused on the ground that the wife had been denied natural justice.
The provisions of s 104(4)(b) of the Act are also attracted as I find that recognising as a divorce what happened at the K Religious Court on 8 June 2009, in the absence of the wife, would be manifestly contrary to public policy in circumstances where the divorce was meant to bring to an end the marital status of the wife and to also end the financial relationship between the parties, both in relation to property spousal maintenance and child support.
Accordingly, the husband’s Response to Divorce based on the assertion that an Australian court would recognise that the husband and wife had already been validly divorced on 8 June 2009, is dismissed.
DIVORCE ORDER
As set out above, I find that the parties were married at District K, Lebanon on a date in July 1997. I find that the applicant/wife is domiciled in Australia and ordinarily resident in Australia for a period not less than 12 months prior to the date of the filing of the application. I find that as at the date of the filing by the wife of her application for a divorce order, namely 13 September 2013, the parties had separated no later than 11 August 2012 and thereafter lived separately and apart for a period in excess of 12 months and that the marriage of the husband and wife had broken down irretrievably.
There are two children of the marriage under the age of 18, C born in 2001 and D born in 2008. I find that proper arrangements in all the circumstances have been made for the care, welfare and development of those children.
The Divorce Order will take effect one month from today.
I grant the divorce order.
SECTION 44(3) OF THE ACT
There had been discussion as to the need to make a s 44(3) application should I have found that there had been a prior valid divorce of the parties which could be recognised in Australia which was more than 12 months prior to the institution of the proceedings for a property settlement order by the wife.
In circumstances where the husband also seeks an order under s 79 of the Act, it was unclear to me as to the basis upon which the husband would have opposed leave being granted under s 44(3), although counsel for the husband indicated that that is what he intended to do.
If I am incorrect in relation to my findings in respect of the recognition of the validity of the Islamic divorce order, given the circumstances described above, I would have easily granted leave pursuant to s 44(3) of the Act.
There is no need however to further consider the leave question given my finding that an Australian court could not recognise the validity of what happened in Lebanon on 8 June 2009 as a valid divorce.
APPLICATIONS
The wife seeks the following:
54.1.Order that the respondent husband transfer to the applicant wife the whole of his right, title and interest in the real property situate and known as G Street, Suburb H in the State of New South Wales being the land comprised in Folio Identifier … by causing to be delivered to the solicitors for the applicant wife within 21 days a duly executed transfer of such interest in registrable form.
54.2.Order that the respondent husband discharge within 21 days any and all financial encumbrances, claims or other financial interests affecting the said G Street, Suburb H real property, and otherwise indemnify and hold blameless the applicant wife in respect of such encumbrances, claims or interests.
54.3.Order that, within 21 days, the respondent husband pay to the wife the sum of $350,000.00.
54.4.Order that upon the respondent husband’s compliance with Orders 1, 2 and 3 herein, the applicant wife transfer to the respondent husband any equity, interest or entitlement that she may have or otherwise be entitled to in respect of:-
54.4.1.EE Pty Ltd.
54.4.2.Mazda vehicle in the respondent husband’s possession.
54.4.3.Any furniture or personalty in the respondent husband’s power, possession or control.
54.5.Order that each party retain to the exclusion of the other party all personal property, interests and entitlements otherwise standing in their respective power, possession or control subject to the rights and entitlements of any third party in respect of such property.
54.6.Declaration that the second respondent Mr O Ahmed, holds his right, title and interest to the real property situate and known as N Street, Suburb P in the said State being the land comprised in Folio Identifer … upon trust for the respondent husband.
54.7.The respondent husband pay to the applicant wife the sum of $400,000.00 within 28 days from the date of these Orders in respect of the respondent husband’s beneficial share or interest in the said N Street, Suburb P property and, further, that such property stand charged as security for payment of such amount as remains outstanding to the applicant wife from time to time pursuant to this Order.
54.8.Order that the respondent husband pay the applicant wife’s costs of and incidental to the proceedings.
54.9.Order that the second respondent pay the applicant wife’s costs relating to the declaratory and consequential relief relating to the N Street, Suburb P trust issue and consequential relief.
The husband seeks the following:
55.1.That the Applicant do all such acts and things and sign all necessary documents so as to transfer to the Respondent all her right, title and interest in the property situated at G Street, Suburb H NSW … and being the whole of the land comprised in Folio Identifer ...
55.2.That the Respondent hereby indemnifies the Applicant from, and in respect of all actions, claims, suits and demands as may be made against the Applicant in relation to the following liabilities:
55.2.1.Debt to Ms A - $300,000.00;
55.2.2.Debt to Mr O Ahmed - $400,000.00;
55.2.3.Debt to Mr U Ahmed - $300,000.00; and
55.2.4.Debt to X Building Supplies - $200,000.00.
55.3.That the Applicant hereby indemnifies the Respondent from, and in respect of all actions, claims suits and demands as may be made against the Respondent in relation to all liabilities in the name of the Applicant.
55.4.That each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession of such party as at the date of these orders including any jewellery, furniture, furnishings, shares and motor vehicles.
The second respondent seeks:
56.1.A declaration that the Second Respondent is no longer a party to these proceedings.
56.2.A declaration that the Second Respondent DOES NOT hold the title to N Street, Suburb P in trust for the First Respondent Husband, but is the owner of the property.
56.3.An order that the Applicant Wife repay the second respondent $400,000.00 within 28 days of the date hereof as payment for the loan between the Applicant Wife and the second Respondent dated 27 March 2012.
NOTICE TO THE HUSBAND’S SECOND WIFE
Given my finding that the husband and wife in these proceedings were validly married up until the time that I made the divorce order, the husband’s Islamic marriage to his second wife would not be recognised as a valid marriage in Australia. Consequently any claim that the husband’s second wife has to a property settlement order is pursuant to s 90SM of the Act.
Section 79(10) of the Act provides that the husband’s second wife is entitled to become a party to these proceedings. Rule 14.07(1) provides that either the husband or the wife must serve a written notice on the husband’s second wife. Both the husband and wife in these proceedings sought that I dispense with that rule. I am prepared to do so for the following reasons:
58.1.The husband’s second wife has been involved in these proceedings by way of being a witness in the husband’s case (she filed an affidavit on 24 January 2014);
58.2.The husband’s second wife has been given notice about the commencement of the hearing. The husband said that he had sent his second wife a text message on 19 August seeking confirmation that she would attend court on the first day of the trial but she never responded to that text message;
58.3.I take into account the length of the relationship between the husband and his second wife;
58.4.There has already been extensive litigation in relation to parenting arrangements in relation to the child which the husband had with his second wife in which his second wife was legally represented;
58.5.The husband said in oral evidence that his lawyers had been advised that his second wife intended to make a property claim against him in the future.
Given those circumstances, I am prepared to dispense with the requirements of rule 14.07.
DOCUMENTS RELIED UPON
The documents the parties relied upon in relation to alteration of property interests are set out in Schedule 3.
SHORT HISTORY
The husband was born in 1969 and is currently 47 years old.
The wife was born in 1978 and is currently 38 years old.
The parties married in July 1997 in District K, Lebanon.
In 1998 the parties’ first child, B, was born and is currently 18 years old.
In 2001 the parties’ second child, C, was born and is currently 15 years old.
In 2008 the parties’ third child, D, was born and is currently eight years old.
The husband says the parties separated on 2 November 2008. The wife says the parties separated on 11 August 2012. I prefer the wife’s assertion.
CREDIT
Wife
The wife gave evidence in a manner which was in stark contrast to the manner in which the husband gave his evidence. She appeared to be candid. She answered questions succinctly and without hesitation. Much of what she has said in her oral evidence has been supported by objective material.
Counsel for the husband asked me to make a finding based on the wife’s admission in relation to her receipt of Centrelink benefits during a period of time when she said the parties were still together as something that reflected on her honesty. The wife’s evidence was that this occurred in about 2008 at a time when the husband told her that he could not afford to support her and the children to live (and I accept that was so) and she said had no alternative. At [22] of the wife’s affidavit filed 20 March 2014 she gives evidence that the husband instructed her to call Centrelink, saying words to the effect, “Call Centrelink and tell [them] we are separated but living under the same roof so you receive the single parent benefit payment. I refuse to support the children and I want you to live off the Centrelink payments”. There was some ambiguity in the wife’s evidence about whether or not she believed she was separated from the husband in 2008. It seems from what she said she did tell Centrelink that she was but it is unclear from her evidence as to whether or not she believed that she was at the time. The husband himself asserts that the parties were separated in 2008.
It was put to the wife in cross examination by counsel for the husband that she was attempting to portray herself as “this down trodden under the thumb Islamic woman”. The wife, in my view quite candidly, conceded that that is exactly how she saw herself. Counsel for the husband in final submissions said that the wife was cynically trying to present the husband as a barbaric, misogynist, Arab man. That was not put to the wife in cross examination and she did not adopt that description of the husband.
Counsel for the husband also pointed to the fact that the wife had said that she had fulfilled the role of homemaker and parent 100 per cent, but conceded in cross examination that while she did not have a licence until shortly after the birth of the second child, the husband had driven her to do the shopping. As a result, the wife reduced the estimate of the percentage of her role of homemaker and parent back to 95 per cent. Counsel for the husband said that that was a concession by her that she had exaggerated her evidence and she knew for a start that 100 per cent was not correct. I do not place great weight on that submission about the wife’s credit.
Husband
Overall I had some difficulty in accepting the husband’s evidence as truthful. The husband did not give his evidence in a straightforward manner. There were a number of occasions when the way in which the husband was answering questions led me to ask him to just listen to the question and try and answer it as shortly and simply as possible and warned him against using a question that had been asked as an opportunity to make some statement about a topic which, in the husband’s mind, had some connection with the question.
The husband’s evidence in relation to debts that he had set out in his first financial statement are inconsistent with subsequent evidence that he gave.
The husband gave no proper explanation as to what happened to the $10,000 per month he was receiving through his company for rent on the property at G St, Suburb H (“the H property”) in the 2014 and 2015 financial years.
The husband was asked questions about the debt he owes to X Timber totalling about $280,000. The husband explained that the debt was incurred when he was doing construction work on the H property when that property was owned by Ms A and her former husband, Mr S. The husband denied that he was able to pass on the debts incurred by X Timber to the owners because he said it was a law that he could not collect more than one per cent out of the invoices. He said “when you go to Fair Trading, it’s only 1 per cent … you can pay until you get the first thing done”. The husband is an experienced builder. It is inherently unlikely that he would believe that he would only be able to receive 1 per cent until he got the first thing done but even if that were true, it does not explain why progress payments were not collected from the Ss as he carried out what appears to be substantial construction work.
Counsel for the wife correctly submits that the husband has not provided, in a timely way, copies of documents that might substantiate numerous claims that he has made in this litigation.
There were a number of specific incidents where the evidence the husband gave was contradictory.
For example, there was a contradiction between the husband’s written and oral evidence about whether as at 20 May 2009 he wished to remain in the parties’ marriage.
At [33] of the husband’s affidavit of 24 January 2014, the husband said:
33. At this divorce meeting [20 May 2009] the Sheikh attempted to reconcile [the wife] and I but we both made it clear that the marriage was over and I did not want to remain married to [the wife] and I wanted to remarry and was seeing someone else at the time.
In his oral evidence the husband said that the wife always wanted to get divorced but he just wanted to keep the kids. He stated, “not really, no” he did not want to get divorced. The husband was asked how those two statements were consistent and he responded that in one sense he wanted to keep the children and the family but wanted to remarry and have a new life as the marriage had been going back and forward from its outset.
Counsel for the wife checked the husband’s answer with him, asking would you have rather stayed together, with the husband replying, yes.
I lack confidence about knowing what exactly the husband’s involvement and interest was in what was alleged to have been his brother’s business, EE Pty Ltd at Suburb Z that was said to have been shut down in recent weeks. The business bore a significant number of hallmarks which were the husband’s (mobile telephone number; email address; and his contact details on the business’ Facebook account) or the husband’s business, EE Pty Ltd at Suburb H (business name; logo; and web address).
Other examples of the husband giving inconsistent or unlikely evidence are referred to elsewhere in the reasons.
Mr O Ahmed (the second respondent)
I was not prepared to accept everything that Mr O Ahmed (“the second respondent”) told me.
I find most unlikely his evidence that he and the husband had not had any conversation about the deed that the husband took with him to Lebanon to have the wife sign which was to document the alleged debt under contract owing by the wife to the 2nd respondent in the sum of $400,000 (detailed below). At this time, the husband was living at the back of the second respondent’s house. The second respondent produced conflicting evidence. In his affidavit filed 1 October 2015 he stated that “they had approached me for help” to fund the purchase of the H property. In his oral evidence the second respondent tried to assert that only the wife approached him but that his family, besides the husband, had put pressure on him to assist the parties to purchase the H property.
As I comment below, I find that in oral evidence, he fabricated the existence of conversations between himself and the wife on the telephone whilst she was in Lebanon and in particular, made up a telephone conversation happening between the two of them at the very time she was alleged to have signed the deed in Lebanon.
Consequently, I am cautious about placing weight upon the second respondent’s evidence about any contentious issue.
Mr V Ahmed
Counsel for the husband submitted that I would be convinced by the demeanour of Mr V Ahmed that he was telling the truth and that he wanted repayment of the alleged outstanding sum of $226,000. I was unable to discern anxiety in relation to repayment from V’s demeanour.
V seemed somewhat surprised when it was pointed out to him in cross examination that the source of the electronic transfer of an amount of $197,500 was a cash deposit into that same account a few days before on 22 July 2010. In that surprised state, V explained that he had that amount in cash in a safe at home. That explanation appeared to me to be a convenient invention. He had said nothing about that being the source of the funds that he advanced in the affidavit that he provided in September 2015 nor did he give any clue as to where the cash came from.
V’s evidence was also totally silent on the arrangements that had been entered into between the husband and himself at the time when the P property was transferred into his name, with him only arranging to take over responsibility for the debt of approximately $55,000 on the property at that time.
I place little weight on Mr V Ahmed’s evidence about any contentious issue.
Conclusion on credit
Unless otherwise indicated, I am generally prepared to accept the evidence of the wife over the evidence of the husband and his witnesses where it is in conflict.
DETAILED CHRONOLOGY
The husband was born in1969 and is currently 47 years old.
The wife was born in 1978 and is currently 38 years old.
The parties met in 1996. At this time the wife was unemployed and lived with her mother and the husband was employed as a skilled tradesman
The parties married in July 1997 in District K, Lebanon.
In January 1998 the parties returned to Australia where they leased a unit for six months.
In 1998 the parties’ first child, B, was born and is currently 18 years old.
In July 1998 the parties rented a house for 12 months.
In 1999 the wife says she obtained an AVO after being assaulted by the husband.
In July 1999 the parties moved into the P property on a lease.
In 2001 the husband purchased the P property in his sole name for approximately $257,000 using about $90,000 from savings and approximately $170,000 from a mortgage with CBA.
In 2001 the parties’ second child, C, was born and is currently 15 years old.
In 2003 the wife says she obtained an AVO after being assaulted by the husband.
In November 2003 the wife was physically assaulted by the husband resulting in her and the children residing in a refuge for three months and then in another refuge for one year.
In late 2003 the parties obtained an Islamic divorce by Sheikh Y of AA Mosque.
In December 2003 the husband transferred ownership of the P property to his cousin, Mr V Amhed.
In late 2004 the parties reconciled and recommenced cohabitation at the P property.
In 2005 the parties underwent a second Islamic marriage ceremony under Islamic Law.
In 2008 the parties’ third child, D, was born and is currently eight years old.
In late 2008 Mr V Ahmed transferred the P property to the second respondent.
The husband says the parties separated on 2 November 2008 and have lived separately since this time.
In March 2009 the husband’s mother died in Lebanon.
On 20 May 2009 the husband asserts that there was an Islamic divorce of his marriage with the wife on the porch at the P property and further asserts that on 8 June 2009 he met, in the absence of the wife, with Sheikh El-Refaei as set out above.
On 1 June 2009 the parties and the children travelled to Lebanon arriving on 2 June 2009. The wife remained in Lebanon with the children to care for the husband’s father. The husband remained in Australia, travelling to Lebanon approximately every five months for about one month duration.
In 2010 the wife travelled to the US with the children to visit her sister. During this time, she says the husband telephoned her to advise that he had received $200,000 which he would transfer to their joint account in Lebanon.
In mid-2011 the husband commenced working on the construction at the H property.
In late 2011 the husband telephoned the wife to discuss the opportunity of purchasing a business.
In about 2012 the husband received $150,000 as a result of a motor vehicle compensation claim
On 20 January 2012 the husband entered into a contract for sale with the wife for purchase of the H property for a purchase price of $500,000.
In 2012, to assist with the purchase of the H property, the second respondent says he lent the wife the sum of $400,000.
In 2012 the husband’s friend Mr L agreed to go into partnership with the husband as a silent partner to set up a business. However, after Mr L became aware of the matrimonial dispute between the parties and the husband and Ms A, he advised the husband that he did not want to be part of the business and asked the husband to repay him the $150,000 which the husband claims Mr L had contributed towards the business.
In 2012 the husband married Ms A in an Islamic ceremony and in late April 2012 she and the husband travelled to Lebanon. The wife says that on the day of the husband’s departure, he presented her with a blank piece of paper bearing her name in the corner and the name of the second respondent in the other corner, for her signature.
In April 2012 the wife says that there were arguments and assaults between her and the husband resulting in several lacerations to her face and her breaking her nose.
In May 2012 the wife says that the husband introduced her to his new wife, Ms A. The wife says she was not aware of their marriage.
In June 2012 the husband returned to Australia with Ms A.
On 26 June 2012 the husband was registered as the director of the EE Pty Ltd business at Suburb H.
On 10 August 2012 the wife returned to Australia with the children where they resided in a hotel for two weeks before renting a unit in Suburb PS.
The parties separated on 11 August 2012.
In September 2012 the wife says that the husband assaulted her at the business by striking her face with a closed fist.
On 21 June 2013 the wife made statements to the police to obtain an AVO. On 26 August 2013 an AVO was granted against the husband protecting the wife for a period of two years.
On 24 September 2013 the wife filed parenting and property proceedings.
On 13 July 2015 undefended parenting orders granted the wife sole parental responsibility for the children and for the children to live with the wife.
CLAIM BY THE SECOND RESPONDENT AGAINST THE WIFE
The second respondent is one of the husband’s younger brothers, Mr O Ahmed. Relying upon accrued jurisdiction, in a Response to Initiating Application filed by the second respondent on 1 October 2015, he relevantly seeks the following order:
An order that the Applicant Wife repay the second respondent $400,000.00 within 28 days of the date hereof as payment for the loan between the Applicant Wife and the Second Respondent dated 27 March 2012.
The second respondent relied upon evidence in his affidavit of 1 October 2015 and a further affidavit filed 30 August 2016.
That evidence was short and I will set it out in full. In his affidavit filed 1 October 2015 he states:
17. On or about early 2012, the First Respondent and the Applicant intended to purchase the property at [G] Street, [Suburb H] (“[H] property”) and set up a [business]. The property was to belong to bothe [sic] Applicant and the First Defendant. The First Defendant had his own funds ready, but the Applicant could not get funding of her own. They approached me for help.
18. Therefore to assist them in purchasing the property and setting up their business, I lent the Applicant the sum of $400,000.00. A loan Agreement was entered into on 27 March 2012. Annexed hereto and marked with the letter “G” is a true copy of the loan agreement between the Applicant and myself. This amount was borrowed from Westpac, usinf [sic] the current mortgage over the Property [[N Street], [Suburb P]] as security.
19. To date the applicant has not made any payments to me for her loan.
20. Annexed hereto and marked with the letter “H” are copies of my bank statements from Westpac Banking Corporation, showing my loan repayments to Westpac for the home loan and Mortgage over the [[P]] Property.
21. all [sic] loan repayments and obligations for the property, as well as the consideration for the purchase of the property has been paid solely by me and has been my responsibility since I purchased the Property in 2008.
In his affidavit filed 30 August 2016 (the second day of the hearing) the second respondent says:
5. In relation to the Loan Agreement with [the wife], I recall that in approximately March 2012 I had a telephone conversation with [the wife]. [The wife] was in Lebanon at the time and I was in Sydney. The conversation was in words to the following effect:
[The wife]: “We ([the husband] and I) are going to subdivide [the [H] property] I will live in that house with the children”
6. A day before the settlement on the [H] property, [the conveyancing solicitors] telephoned me and said, “Make the cheque payable to RAMS”. I arranged a bank cheque with Westpac. The relevant bank statement is an annexure to my first affidavit.
7. On the day of the settlement I attended the offices of [the conveyancing solicitors]. [The husband] and [the conveyancing solicitor] and the Vendors, who I knew, were there. I gave $100,000.00 in cash which I had carried in a briefcase to [the conveyancing solicitor]. I also provided a Bank cheque to [the conveyancing solicitor]. I have recently seen Westpac internet page which shows that RAMS is part of the Westpac Group. I annex as annexure A a true copy of the cheque.
A bank cheque payable to RAMS Financial Services or bearer in the sum of $300,000 is annexed.
The second respondent then gives evidence that in August 2012, upon the wife’s return from Lebanon, he had a meeting with her at McDonalds where he asserts that she informed him that she was not intending to live at the H property and that she was not going to pay him and that she was going to make a claim against the P property. The wife denies that this exchange occurred.
Annexure G to the first affidavit is a three page document which, on its face, appears to be a deed dated 27 March 2012. The document is not signed on the first two pages. The wife’s signature appears on the third page along with the second respondent’s signature. The 2nd respondent’s signature is witnessed by his brother, Mr U Ahmed, apparently on 20 March 2012 and the wife’s signature is witnessed by the husband, apparently on 25 June 2012.
The wife’s evidence about signing the last page of annexure G to the second respondent’s first affidavit is contained in [67] of her affidavit filed 20 March 2014. In that affidavit she says that on the day the husband was departing from their residence in Lebanon to return to Australia (in June 2012), he called her into their bedroom. Upon entering the husband handed to her a sheet of paper and told her to sign it. She then gives the following evidence:
Other than my full name which appeared in one corner and the name [O Ahmed] which appeared in the other corner, the paper was blank.
I said: “What is this?”
He said: “You have to sign because [O Ahmed] is your guarantor”.
I said: “What does that mean?”
He said: “Don’t worry, just sign it”.
The wife then gave evidence that she signed the paper out of fear that if she refused to sign it she would be further assaulted (this is in the context of allegations made by the wife that there had been significant family violence in the marriage). The wife says she does not know what became of that sheet of paper.
In cross examination the second respondent conceded that he understood that it was the wife’s case that she had never signed a deed in the form as annexed to the second respondent’s first affidavit.
The wife’s evidence (and the date under the wife’s signature) indicates that the document that the wife signed was signed by her three months after the settlement of the acquisition of the H property.
The second respondent did not in his evidence in chief, lead any evidence about negotiations between him and the wife nor the terms of any alleged oral contract that preceded the formal written deed.
In oral evidence, the second respondent did attempt to say that there were conversations between him and the wife prior to her signing the agreement. In fact, at one point in his evidence during cross examination, the following exchange occurred:
Mr Gilbert: you did know that [the wife] was in Lebanon?
2nd respondent: yes I did know
Mr Gilbert: you knew that in order for her to sign the document it would have to go to Lebanon
2nd respondent: she was saying she’s coming back
Mr Gilbert: you knew she was in Lebanon didn’t you
2nd respondent: yeh yeh I knew she was in Lebanon
Mr Gilbert: and you knew she had to sign it in Lebanon
2nd respondent: yes
Mr Gilbert: and you entrusted your brother to get her to sign it
2nd respondent: yes
Mr Gilbert: you don’t know what she signed, you weren’t there do you
2nd respondent: I was on the phone with her
Mr Gilbert: when was that Mr [Ahmed]
2nd respondent: because we had the conversation before
His Honour: Mr [Ahmed] you’re being asked about the time when she signed the document. You weren’t on the phone with her then were you
2nd respondent: yes I was on the phone with her
Mr Gilbert: when was that?
2nd respondent: on the date she signed that
The second respondent studied medicine for two years and accepted that he was a “bright fellow”. The second respondent’s current employment was as a used car salesman. The second respondent’s assertion that he was on the phone with the wife at the time that she signed the deed is in my view an invention by him.
Counsel for the second respondent submitted that there was no challenge to the fact that a payment of $400,000 had been made by the second respondent. Page 69 of the second respondent’s first affidavit would indicate that a bank cheque for about $300,000 was obtained by a withdrawal from an account in his name on 21 March 2012. $45,000 was transferred into that account shortly before the cheque was drawn and there seems to have been a borrowing of $383,000 by way of a loan in March 2012. There was no exploration with the second respondent as to the details of the arrangements by which he came by the $300,000 bank cheque. In relation to the other $100,000 in “cash”, the second respondent’s evidence was that over half of it was not in fact “cash” but rather cash withdrawn from other accounts that he had. The second respondent did not produce any records of the financial institutions from which he had withdrawn this cash.
The wife’s defence to the second respondent’s claim in contract does not require any findings as to whether or not the amount of $400,000 passed from the second respondent to the husband and wife. That was not the basis of the wife’s challenge.
Counsel for the second respondent sought leave at the conclusion of the evidence to orally amend the second respondent’s claim so that the second respondent might be able to assert a resulting trust against the H property or alternatively, a claim for monies had received or quantum meruit. Counsel for the wife indicated they were not in a position to meet that amendment given that the wife had only met the second respondent’s case that she was liable under a written deed dated 27 March 2012 on the basis that there was no contract at all between her and the second respondent. The wife’s case was “non est factum”. That is, the deed was not hers and she did not sign that deed.
As discussed during submissions, it is the second respondent’s case that he deputised the husband, three months after the settlement of the purchase of the H property, to take the alleged deed to the wife in Lebanon and obtain her signature on the deed.
Counsel for the wife makes a Jones v Dunkel (1959) 101 CLR 298 submission that in the second respondent’s case he did not seek to call the husband as a witness in circumstances where the second respondent well knew that the wife was disputing that what she signed was the document that the second respondent was now relying upon. In addition, the second respondent called no evidence from the lawyer who drafted the original agreement.
Counsel for the second respondent submitted that it was improbable that the words on the top of the last page, which the wife agrees she put her signature on, were not there at the time she put her signature upon it. I am not prepared to make that assumption in face of the sworn evidence of the wife which has been unchallenged by the calling of evidence from the witness to her signature.
During the hearing, the second respondent sought to assert that there was an oral contract between the second respondent and the wife. Notwithstanding the relief sought by the second respondent specifically referred to a loan at date of the alleged deed, I also am unable to find that there was ever any oral contract between the second respondent and the wife. The second respondent made up the evidence about him having a conversation with the wife over the telephone as she was signing the agreement in Lebanon. I accept the wife’s evidence that she only spoke to the second respondent on the telephone when she was in Lebanon when he called to speak to his father. She would greet him before passing the telephone on. She said, and I accept, that he did ask about the children but they never had a conversation about the H property.
In the evidence that the second respondent originally gave, there was no indication that there had been any conversation between he and the wife about the agreement. In the affidavit that he filed during the proceedings, he gives evidence about a single statement by the wife on the telephone where the wife told him that she and the husband were going to subdivide the H property and that she intended to live in the house with the children. It is only in oral evidence that the second respondent attempts to assert that there were maybe a “million” conversations between he and the wife on the telephone and they “spoke all the time” whilst she was in Lebanon.
The only evidence that I am left with in relation to how the wife’s signature came to be on the document which is Annexure G to the second respondent’s first affidavit, is that of the wife. In those circumstances the relief sought by the second respondent based on the contract contained in the deed must fail.
APPROACH TO APPLICATIONS FOR A PROPERTY SETTLEMENT ORDER
In this matter my task is to:
157.1.Identify according to ordinary common law and equitable principles and then value the property, assets, financial resources and liabilities of the parties;
157.2.Determine whether it is just and equitable to make an order altering those interests and if so;
157.2.1.Identify relevant contributions and assess them;
157.2.2.Consider relevant matters referred to in s 79(4)(d) – (g) of the Act;
157.3.Determine what order adjusting the property, assets and liabilities of the parties is just and equitable.
BALANCE SHEET
The settled balance sheet is set out below. Where values are not agreed they appear in bold as determined by me. The reasons for each determination are set out under item numbers following the table.
| Assets | |||||||
| Item no. | Title | Description | Husband’s value | Wife’s value | Agreed/ Determined | Value | |
| 1 | H | EE Pty Ltd | $0 | $70,000 | Determined | $70,000 | |
| 2 | J | G Street, Suburb H | $990,801 | $990,801 | Agreed | $990,801 | |
| 3 | H | Hilux motor vehicle | $5,000 | nk | Determined | $5,000 | |
| 4 | H | EE Pty Ltd Suburb Z | $0 | nk | Determined | $0 | |
| 5 | H | EE Suburb Z Pty Ltd | $0 | nk | Determined | $0 | |
| 6 | W | Japanese vehicle | $3,000 | $3,000 | Agreed | $3,000 | |
| 7 | W | Furniture | $5,000 | $5,000 | Agreed | $5,000 | |
| 8 | W | Personal items | nk | $0 | Determined | $0 | |
| 9 | H | Household contents | $2,000 | $2,000 | Agreed | $2,000 | |
| 10 | H | Essential Super | $785 | $785 | Agreed | $785 | |
| Total assets | $1,076,586 | ||||||
| Liabilities | |||||||
| Item no. | Title | Description | Husband’s value | Wife’s value | Agreed/ Determined | Value | |
| 11 | H | X Building Supplies | $260,878 | $0 | Determined | $0 | |
| 12 | H | Mr U Ahmed | $100,000 | $0 | Determined | $0 | |
| 13 | H | XXX Firm | $140,170 | $0 | Determined | $0 | |
| 14 | H | Mr L | $130,000 | $0 | Determined | $0 | |
| 15 | H | Mr V Ahmed | $226,100 | $0 | Determined | $0 | |
| 16 | H | Master Build | $72,000 | $0 | Determined | $0 | |
| 17 | H | Mr O Ahmed | $400,000 | $0 | Determined | $0 | |
| 18 | H | RR Lawyers | $70,000 | $0 | Determined | $0 | |
| 19 | H | St George Mastercard | $6,000 | $0 | Determined | $0 | |
| 20 | J | Land tax | $9,038 | $9,038 | Agreed | $9,038 | |
| 21 | H | Legal fees (Ms ZZ) | $48,000 | $0 | Determined | $0 | |
| Total liabilities | $9,038 | ||||||
| Total net assets | $1,067,548 | ||||||
Item 1 – EE Pty Ltd
In the husband’s affidavit filed 4 August 2016 he states the following:
[62] …I have now entered into negotiations from the sale of the … Business known as EE P/L to [Mr NN] for the sum of $70,000.00. I am in the process of exchange and settlement and confirm that I have taken an initial deposit of $20,000.00 with settlement expected to be finalised on 5 August 2016.
In oral evidence the husband confirmed that he had sold the EE Pty Ltd Suburb H business for $70,000 to Mr NN. The husband provided no sale of business agreement or any other documentation that would corroborate the terms of the sale, explaining that he had been too busy to collect the agreement.
The husband disclosed in oral evidence that as part of the arrangements with the new owner of the business (who was not called by the husband to give evidence), he has granted the new owner a leasing arrangement where no rent is paid for a period of twelve months and after twelve months the purchaser at the purchaser’s option, is able to enter into a three by three lease of the part of the property used as the business. Again, no document was produced which would indicate the terms of that arrangement but the husband says the annual rent will be $900 a week. Importantly the husband conceded the wife, a joint owner of the H property, did not know and was not involved in an alleged granting to a purchaser of an option which could be exercised at the expiration of a twelve month period.
Apart from what the husband wrote in his affidavit and an assertion that he made certain comments in open court, the wife was not forewarned about the details of the arrangements between the husband and the purchaser of the business.
Tendered in evidence were the financial statements of the business for the 2014 and 2015 financial years. Whilst the company was not on the face of the financial records making a profit, the husband was receiving significant advantages from monies paid to him by the company. Notably in those two financial years, an amount of $120,000 per annum was paid to the husband by the company for renting the premises. The husband was also receiving wages from the company for working in the business.
The husband asserted in oral evidence that the gross turnover of the company had significantly decreased in the 2016 financial year because of a significant fall in the number of clients using the business. The husband produced no corroborative business records that would substantiate that claim. The wife is left in a situation where she does not know whether or not $70,000 is a fair figure for the sale of the business. Notwithstanding that, she accepts that the only evidence available is the husband’s evidence that he received $70,000 for the sale of a business.
The husband says that the item should be counted as nil on the balance sheet because there is none of the $70,000 left. The husband provided a number of bank cheques that he has paid to persons he asserts are owed money totalling $50,000. He says he has distributed:
165.1.$20,000 to X Timber on 26 August 2016 (Exhibit 12);
165.2.$10,000 to XXX Firm on 26 August 2016 (Exhibit 13); and
165.3.$20,000 to Mr L on 26 August 2016 (Exhibit 14).
In oral evidence the husband said that he spent the remaining $20,000 on legal costs in relation to criminal charges and police costs (whatever police costs might mean).
Apart from the bank cheques to X Timber, XXX Firm and Mr L, there is no corroborative evidence that the bank cheques (which are “bearer” cheques and the equivalent of cash) have reached the recipient to whom they are addressed. The husband’s assertions in relation to those liabilities are dealt with in various items below.
On the basis that the husband says he received $70,000 for the business run by EE Pty Ltd, that item will be added to the balance sheet against the husband in an amount of $70,000.
Item 3 – husband’s motor vehicle
The husband was not prepared to agree to adopt any other figure than the estimate that he placed on his most recent financial statement. The wife had provided no other admissible evidence. That item will be determined to be $5,000.
Items 4 and 5 – Suburb Z business
The EE Suburb Z business and EE Z Pty Ltd is a business and a company said to be owned by the husband’s brother, Mr U Ahmed. The business was deregistered on 15 June 2016. Mr U Ahmed and the husband’s cousin, Mr V Ahmed, were directors of the company. The husband was the secretary of the company. The husband’s brother held the entire number of shares issued.
The wife tendered a picture of the business’ Facebook page (Exhibit 21) which indicated that the sign outside the business listed the husband’s mobile phone number and an email address linking to the husband’s business at Suburb H. The picture also indicated that the Suburb Z business used the same logo and web address as the Suburb H business.
The husband disavowed any financial interest in the Suburb Z operation although he agreed that from day one he gave his brother assistance and advised his brother in relation to the establishment and running of the business. The husband conceded that he had been involved in correspondence arranging for construction to the property so that it could function as a business in order to obtain a Commercial Design Certificate and in line with the appropriate state legislation (Exhibit 22). The husband said that his brother had come to him for help and the husband had agreed as he knew the appropriate people to contact.
The husband in oral evidence asserted in any event that shortly before the hearing his brother had shut down the business.
Counsel for the wife conceded in submissions that I could place no value on the husband’s interest in the Suburb Z operation.
The husband’s interest in items 4 and 5 will be marked on the balance sheet as nil.
Counsel for the wife relied upon the evidence in relation to the husband’s involvement in the Suburb Z business with his brother and cousin as part of the overall evidence relating to how the Ahmed brothers and cousin Ahmed operated to assist one another in financial dealings.
Item 8 – wife’s personal items
In the wife’s most recent financial statement, the wife assesses the value of her personal items at nil. The husband says that he is unaware of the value of personal items including gold and jewellery held by the wife.
The husband asserted that he had given the wife two amounts of gold. One amount of half a kilogram and another amount of one and a half kilograms. On the joint balance sheet tendered at the commencement of the hearing, the husband allocated a value of $115,000 to the gold. The husband agreed that he did not have adequate evidence to support this value.
In cross examination the wife denied that she had ever received gold apart from four 18 carat gold bangles as well as a necklace and a ring given to her on two different occasions by the husband. She said that these items were left in a cupboard at the home of the husband’s father in Lebanon. The wife assessed the value of those bangles which she says she left in Lebanon to be about $2,500.
While I have some difficulty in accepting that the wife had not brought those items back to Australia with her in 2012, given that I have otherwise accepted the wife as a truthful witness, I am not on balance prepared to accept the suggestion that she is not being truthful given that the husband gave no evidence at all of giving her four 18 carat gold bangles.
I place no value upon the wife’s personal items.
Debts claimed by the husband
The Full Court in Biltoft & Biltoft (1995) FLC 92-614 at page 82,127 reiterated statements made in previous cases that notwithstanding the general practice which has developed of including unsecured liabilities on a balance sheet “the Court has indicated that it may properly determine not to take into account or to discount the value of an unsecured liability in certain circumstances. Such liabilities would include but are not limited to a liability which is vague or uncertain, it is unlikely to be enforced or if it is unreasonably incurred.”
Item 11 – Husband’s debt to X Building Supplies
In the husband’s first financial statement filed 14 February 2014 the husband lists at item 47 a joint debt that he asserts is owed by the wife and himself to X Building Supplies in the sum of $200,000.
In the fourth affidavit that the husband has filed in support of his application for a property settlement order, at [61] the husband says:
I further say that I am indebted to a number of creditors annexed hereto and marked with the letter “E” are letters from my various creditors.
Part of annexure E (at pages 82 to 90) are a series of invoices from a business operated under the business name “X Timber”. The invoices are all in handwriting and are addressed to EE Pty Ltd at Suburb H and to the husband. They detail materials asserted to have been delivered to the H property. The invoices are dated between 26 July 2011 and 20 September 2011. The invoices are sequentially numbered notwithstanding they were issued at different times over a period of about three months. In oral evidence the husband suggested that X Timber kept one individual book relating to each individual job so would have retained that book in relation to the work on the H property until the job was completed. That is improbable as it would logically follow that X Timber, who did not seek to become a party not represented and did not give evidence in the husband’s case, would have kept an individual invoice book not only for each builder but also for each job that each builder did.
As just observed, the invoices are firstly addressed to a company and the issue would arise as to whether or not the contract is with the husband or with that company. The husband said in oral evidence that the company does not have an account with the building supply company but it is difficult to understand how that would be so given the way the invoices are drawn. The husband said that the company’s name was only on the invoices “for tax purposes” which in fact is evidence supportive of the notion that this debt, if it exists, is a debt owed by the husband’s company which has disposed of its principle asset. The husband, in the alternative, suggests he had personally guaranteed the company’s debt to Mr X.
The invoices total $280,877.72 but that is less the $20,000 bank cheque that was subsequently drawn by the husband to Mr X from the sale of the Suburb H business. The amount owing to X Timber is therefore $260,877.72
The husband gives no satisfactory explanation as to why his sworn financial statement in 2014 has this debt at $200,000.
Mr X is a friend with whom the husband has at least had a business association that goes back some decades. The husband gave evidence that Mr X has known about the existence of these proceedings. I infer that he has chosen not to intervene in them. The husband has not called Mr X as a witness in his own case as one would expect he would have in respect of a debt of this significance.
In oral evidence, the husband explained that X Timber were a timber merchant and building supplier who provided goods as well as installation. Their services were used to originally fulfil contractual obligations between himself and Mr Mr S and Ms A (then Mrs S). However, the husband purchased the H property soon after works commenced on the property. The wife says that the husband advised her that the S’s had become insolvent so the husband discussed purchasing the property from the S’s. In oral evidence the wife attempted to explain what insolvent meant before explaining that it meant that the S’s were unable to finish the work on the property.
The husband does not otherwise mention in any of his four affidavits how these debts came about.
The issue arose as to how there was an accounting between the husband and the Ss for materials supplied to the S’s property in 2011.
Exhibit 9 is the contract for sale of land between Mr S and Ms A (then Mrs S) as vendors and the husband and wife as purchasers dated 20 January 2012. On its face the purchase price is $500,000 with the husband and wife providing a deposit of $85,500 and a balance of $414,500 being required on settlement.
Nothing in that contract or the seven pages of special conditions attached to that contract would give any clue as to how there was an accounting between the Ss and the husband and wife in respect of either any monies owed by the Ss to the husband as a result of him providing, through X Timber, materials for the improvement of the H property or for the husband’s time both “on the tools” and in the capacity as supervising builder.
Part of annexure E to the husband’s fourth affidavit also includes (at page 95) a letter from XXX Firm (barristers and solicitors in the ACT) addressed to the husband dated 2 July 2015. The letter contains a demand for the payment of the sum of $280,877.22 with a further claim for interest which is asserted to be $89,872. The husband has not included that claim for interest as part of the debt that he asserts for the purposes of the balance sheet between the parties. The sum which the husband wishes to assert should be placed on the balance sheet is an amount of principle without any interest. The husband seemingly concedes that he produced no evidence of any written agreement relating to interest or any conversations with Mr X in relation to interest.
Curiously, XXX Firm were the husband’s lawyers and those lawyers had also written to the husband on 25 June 2015 (page 96 of the husband’s fourth affidavit) making a claim for outstanding legal fees in the sum of $150,170 (see below).
The only other document relevant to the claim by X Timbers in evidence is exhibit 12. This is an invoice created on 26 August 2016. It is in handwriting. It records the receipt from the husband of a bank cheque of $20,000 (part of the proceeds of the husband’s asserted sale of the business at Suburb H) and records “Amount Balance $260,877.72 Additional interest to be calculated in full”.
Given:
198.1.My general reluctance to accept the evidence of the husband without corroborative evidence which I accept;
198.2.The lack of explanation from the husband as to what arrangements were made with the Ss in relation to this debt as at the date of entering into the contract to buy their property dated 20 January 2012;
198.3.The lack of the ability of the wife because of lateness of the production of the documents by the husband to test assertions made on the face of documents;
198.4.Suspicions that arise in relation to the sequential numbering of the invoices;
198.5.The lack of any action taken by a building supply company over a period of almost five years to enforce a debt;
198.6.The invoices being addressed to the husband’s company;
all lead me to conclude that this asserted debt by the husband should be marked as “nil” on the balance sheet.
I am not prepared, based on the evidence that has been provided by the husband, to accept that there is an enforceable debt owed to X Timber in the sum of $260,877.72 that should be placed as a liability of the husband upon the balance sheet and accordingly I will mark item 11 as nil.
Item 12 – Husband’s alleged debt to Mr U Ahmed
The husband refers to a debt to his brother U in his financial statement sworn 14 February 2014 (exhibit 20). In that financial statement he asserts that he owes Mr U Ahmed $300,000.
In his amended financial statement filed 4 August 2016, the husband says that U is owed “$100,000 PLUS INTEREST”. In oral evidence the husband explained that the reason for the difference in the two figures in the financial statements was that U was guaranteeing his debt (a verbal guarantee) to his cousin Mr V Ahmed in the approximate sum of $200,000 but he owed him another $100,000 as well.
The issue arises as to whether or not this debt should be treated as an amount recoverable by the second respondent against the husband or whether or not the issue of contribution towards the acquisition of the H property should be dealt with at the second stage.
Given that the second respondent steadfastly asserted that this was not a debt owed by his brother but only owed to him as a debt by the wife under a deed and that he has been unsuccessful in that claim, it is difficult to see how I could find as the husband has invited me to, that it is now a debt the husband owes his brother.
A further consideration of the issue of a contribution towards the H property will be dealt with when discussing contributions. The second respondent also in answers to questions in cross examination was evasive about whether, if the debt to the wife was not established, he would not sue his brother for the money. The second respondent evaded the question on two occasions but eventually said that he would chase his brother because the property was in his brother’s name jointly with the wife. Relying upon what was said in Biltoft, I am not comfortable with treating this amount as a debt which the husband would be required to repay the second respondent at any foreseeable time. I will therefore mark it as nil on the balance sheet.
Items 18, 19 and 20 - Husband’s debt to RR Lawyers; St George Mastercard and legal fees (Ms ZZ)
In final submissions, counsel for the husband conceded that it was not appropriate to place any monies that the husband may owe under these items on the balance sheet.
WHETHER AN ORDER ALTERING INTERESTS SHOULD BE MADE
The parties have separated and their partnership has ended. After the separation, there was no longer a continuing commitment to the mutual use of assets and a shared responsibility for liabilities. As the balance sheet set out above demonstrates, the assets and liabilities remaining with each party are $990,801 in assets held jointly; $9,038 in liabilities held jointly; $77,785 in assets held by the husband and $8,000 in assets held by the wife.
I find that in all the circumstances, it is just and equitable to make an order altering property (including adjusting liabilities).
CONTRIBUTIONS
Counsel for the wife says that up until the date of separation, contributions should be treated as equal but in the post separation period where the husband has made no contributions in the role of parent, the wife should be given another 10 per cent adjustment, so that overall there should be a 60/40 adjustment in her favour based upon contributions.
The husband seeks an 80/20 adjustment in his favour based on contributions. The husband asserts that the court would find that the husband made 100 per cent of the direction financial contributions to the acquisition of the principle asset, namely the H property.
Initial contributions
It is an agreed fact that neither party had any significant initial contributions and that all assets were accumulated by the parties during the period of the marriage.
Financial Contributions
The husband worked through the marriage and the wife was not in paid employment.
The husband points to personal injury monies which he says were about $150,000 that he said went towards the acquisition of the H property either directly or indirectly.
Counsel for the husband asks me to accept that the balance acquisition costs of the H property in the sum of approximately $400,000 all came from the second respondent.
I have difficulty in accepting that proposition unreservedly because of the lack of certainty I have based on the evidence presented as to what in fact has been the history of the financial arrangements between the Ahmed brothers and cousin Ahmed. I bear in mind the fact that the second respondent currently lives in the P property. He is the registered owner of that property. Some of the mortgage on that property has from time to time been paid from monies provided by the husband (allegedly by way of rent but not always. Exhibit 19 are bank statements from Westpac which on 18 December 2012 states that he received $2,400 by way of “loan payment” from the husband. In oral evidence the second respondent first said that this was a rental payment made by the husband but later stated that the husband would borrow money from him and later pay him back. However, similar amounts were deposited by the husband, for example $2,500 on 15 May 2013 by way of “rent for [O Ahmed]”).
I am mindful of the fact that the husband does not ever seem to have received a proper payment for the equity that he had in the P property at the time he transferred it to Mr V Ahmed. V transferred the P property to the second respondent. The second respondent alleges that there was a transfer of property that he had in Lebanon to V. I have little confidence I know how the husband, his father (who did not give evidence), the second respondent, V and the husband’s other brother beneficially hold real estate in Lebanon.
The husband did not disclose the existence of three properties in Lebanon which were registered in his name in 2008. This was evidence that the wife presented after she had searched the official register in Lebanon. The husband’s explanation that these were properties originally held by his father and transferred to him does not seem to coincide with the official record. I further discuss this at the third stage. I will specifically take into account the existence of the three properties in the husband’s name in Lebanon when dealing with s 79(4)(d) – (g) considerations.
As mentioned above, we know that the husband was able to generate sufficient income between March 2001 and December 2003 to reduce the mortgage on the P property from $170,000 to $55,000, that is a reduction of $115,000 off principle in under three years. The husband does not, on the face of it, appear to have, according to his evidence, thereafter accumulated any wealth whatsoever (apart from the natural increase in the market value of the H property). There was a total lack of explanation by the husband as to what he has done with his personal exertion income after December 2003. It seems that prior to 2012 the husband continued to work in the building industry because he was supervising as builder on the construction and renovations to the Suburb H business on behalf of the Ss. At some point in time, the husband had a motor vehicle accident. So far as I am aware no evidence was led as to when. In his affidavit filed 28 September 2015 at [9] the husband says, “After the motor vehicle accident I was left with permanent injuries to my neck and lower back which meant that I could not resume work in the building industry in which I had been working in for at least twenty years and this forced me to look for light duty employment and I ultimately decided to find employment in the [business]”. The husband gave evidence he now has the capacity to earn substantial annual income through his personal exertion in the building industry.
I have mentioned, when discussing the husband’s credit, the unsatisfactory nature of the generalised answers he gave in respect of what happened to the $240,000 in rent that he received from the H property in the 2014 and 2015 financial years.
Given my lack of confidence in knowing what monies each of the three brothers and V Ahmed really held as their own, I am not confident in finding that a contribution was made towards the H property of $400,000 on the husband’s behalf by the second respondent.
I also find the husband has not made a full and frank disclosure about the assets which he holds.
Non-Financial Contributions
I do not accept the husband’s evidence to the effect that he played an equal role as parent. I accept the wife’s evidence that she made 95 per cent of all the contributions made in the role of homemaker and parent. In oral evidence that wife asserted that the husband never changed one of the children’s nappies, never prepared food for the children, never clothed or bathed them or attended any social or sporting activities relating to the children. I accept that that is so.
The wife in her affidavits provides written evidence of significant incidents of family violence, the worst of which was an assertion by her that a blow by the husband with his fist to her face broke her nose and that that break required surgery. There was no real testing of the allegations of family violence and in final submissions counsel for the wife did not ask the court to make any adjustment based upon the principles articulated in Kennon v Kennon (1997) FLC 92-757.
Post Separation Contributions
The wife has exclusively made contributions in the role as parent since separation.
Conclusion on contributions
Looked at on an overall basis this is a case where over a lengthy marriage the husband was the person who earned the money and the wife stayed at home and looked after the three children.
The husband did make some contributions through a third party injury award to the acquisition of the H property. I do not take into account any contributions alleged to be made on his behalf by his brothers or cousin. I counter-balance that against the contributions made by the wife exclusively in the role of parent post separation. I reach the conclusion that contributions to the assets that the parties have asked me to place on the balance sheet (in accordance with the findings I have then subsequently made about those assets) should be divided 50 per cent to the husband and 50 per cent to the wife.
FUTURE NEEDS - SECTION 79(4)(d) - (g) MATTERS
The wife seeks that a further adjustment be made of somewhere between 25 and 30 per cent in her favour for 75(2) considerations.
The husband concedes that there should be a 10 per cent adjustment in favour of the wife for 79(4)(d) – (g) matters.
The husband is 47 years of age; the wife is 38 years of age.
The husband claims he is no longer fit for heavy duties but has led no evidence to support that claim. As indicated above, the husband said at [9] of his affidavit of 28 September 2015 that the injuries he sustained in the motor vehicle accident meant that he was no longer able to work in the building industry. The husband gave oral evidence that he has an offer in the building industry to work as a supervisor for a large firm at a gross income of $120,000 per year. On the following day he gave oral evidence, (clearly having thought about it overnight), that he may not choose to commence that position for four to five months to give him time to recover from the stress of the current litigation and other court cases in which he has been involved.
The wife is in reasonable health. She is working casually part time. The wife left school in year nine when she was aged about 14 or 15 and has never had a full time job in the workforce. The wife is currently employed as a casual child care worker and as at July 2016 was earning $250 per week in that capacity. The husband submits that given the two younger children attend school, there is no impediment for the wife to engage in full time employment. I find that the husband’s earning capacity is significantly greater than the wife’s.
The wife complains that the husband is paying minimal child support ($33 per month). The husband submits in reply that if he does in fact take up the offer of employment at $120,000 per year then the wife will see a significant increase in the level of child support she receives in accordance with the statutory formula. The husband, however, seems to take the view that exercising his earning capacity is something he can do at his option.
The wife continues to have the primary care of two children aged (15 and 8).
The husband gives evidence that there are existing court proceedings in relation to parenting arrangements for the three year old child of the marriage between the husband and Ms A but I have no information about what the parenting arrangements are or likely to be. The husband in full knowledge of those responsibilities however has indicated that he believes he has an earning capacity in the range of $120,000 per annum. I accept that the husband has an obligation to contribute towards the maintenance of his three year old child.
The wife, at the request of the husband, looked after the husband’s father for a period of three years while she was in his home in Lebanon (although I note that the husband denies this).
In the context of 75(2)(o) considerations, counsel for the wife relied upon Black & Kellner (1992) FLC 92-287 and Weir & Weir (1993) FLC 92-338. I have already taken lack of full and frank disclosure into account when assessing what contributions the husband has made (as opposed to them being made on his behalf of his brothers or cousin) when dealing with contributions.
Annexure C to the wife’s affidavit filed 5 November 2015 is a translated title search of the properties said to be purchased by the husband in Lebanon. The properties at …1, …6 and …51 KK, District K are documented as “Full Ownership” to be held by the husband. There is no information on that document to indicate from whom the husband received the title of the property and the date of the transfers or any indications as to the consideration or price at which the property was transferred. The wife asserts that monies were borrowed by the scond respondent from Westpac and secured by way of mortgage over the P property which monies were utilised by the husband to purchase these three parcels of land in Lebanon.
In oral evidence the husband asserted that he was holding these three properties on trust for his father. Annexed to the husband’s affidavit filed 4 August 2016 are “Translation of Cadastral Statement[s]”. The documents indicate that the husband became the owner of the property at …1 KK, District K on 22 December 2008. The documents also indicate that the husband became the owner of …6 KK, District K on the same date. In oral evidence the husband denied purchasing the property at …6 on this date. In relation to the property at …54 KK, District K the documents indicate the property was sold to the husband on 1 July 2008 by a person named Mr T. In oral evidence the husband said this occurred in his father’s favour. The husband said that Mr T was a man in Lebanon not related to him. In oral evidence the husband asserted that he is not the full owner of these properties, rather that he holds a share in them. On their face, the documents annexed to the husband’s affidavit do indicate that he holds part of the shares of these three properties in Lebanon.
The husband also annexes to his most recent affidavit a translation of his father’s will by a lawyer, Mr KH, who states that the husband’s father is the true owner of the three properties in Lebanon and the husband holds them “in name only and that he did not pay any sum of money for it as he has full trust in him to keep these properties as a career and trustee on it, and to distribute it after he passed away among himself and his brothers”.
I do not accept the husband’s explanation about the beneficial ownership of the three properties in Lebanon. It follows that I find that the husband has not made a full and frank disclosure about the value of those properties and his ownership of them.
That of course raises the spectre of there being other assets held by others on behalf of the husband that I am not aware of.
The husband has invested considerable time and money into the property in which his father lives in Lebanon, providing material for the construction of significant additions to that property and providing his own labour.
The husband has available to him as a financial resource, arrangements that he can enter into with his brothers and his cousin. An example of that is the fact that the second respondent has, for some time, provided to the husband a prestige motor vehicle to drive, currently a German vehicle, and before that an Italian vehicle. The wife drives a Japanese vehicle. I infer the mechanical condition of the husband’s Italian vehicle was materially superior to that of the 17 year old Japanese vehicle that the wife uses to transport the children.
Counsel for the husband sought to rely on s 75(2)(ha), namely the effect of any proposed order on the ability of a creditor to a party to recover the creditor’s debt. So far as that effect is relevant, only the second respondent has sought to be joined as a party to the proceedings for the purpose of attempting to obtain judgment against the wife in respect of a debt that he claims the wife owed him. All of the other creditors have been given notice and have not sought to intervene in the proceedings. I have otherwise made comments when dealing with the wife’s debt to the second respondent and the other asserted debts by the husband as to the unsatisfactory nature of the evidence to support those assertions. It may well be that the husband has some obligation to some of the alleged creditors but given the state of the evidence, I have no confidence in predicting how much the husband will ultimately pay to any of the persons to whom he has said he owes money and I place little weight on any such obligation.
I find that based upon the considerations discussed, the wife should receive a 15 per cent adjustment based upon s 79(4)(d) – (g) factors.
JUST AND EQUITABLE
Based on the submissions made by the wife in relation to contributions and s 79(4)(d) – (g) considerations, the wife would seek that the assets be divided somewhere between 85 and 90 per cent in favour of the wife. Based on contributions and s 79(4)(d) – (g) considerations, the husband would seek that the assets be divided as to 70/30 in favour of the husband.
Based upon my findings on contributions and s 79(4)(d) – (g) considerations, the wife on contributions would be entitled to a 65/35 division of the assets. That could be achieved in the following way:
| Husband gets 35.0% | |||
| Assets | |||
| Item No. | Description | Percentage | Value |
| 1 | EE Pty Ltd | 100% | $70,000 |
| 2 | G Street, Suburb H | 100% | $990,801 |
| 3 | Hilux motor vehicle model 2007 | 100% | $5,000 |
| 9 | Household contents | 100% | $2,000 |
| 10 | Essential Super | 100% | $785 |
| Liabilities | |||
| Item No. | Description | Percentage | Value |
| 20 | Land tax | 50% | $4,519 |
| Husband pays Wife | $690,425 | ||
| Net Assets | $373,642 | ||
| Wife gets 65.0% | |||
| Assets | |||
| Item No. | Description | Percentage | Value |
| 6 | Japanese motor vehicle | 100% | $3,000 |
| 7 | Furniture | 100% | $5,000 |
| Liabilities | |||
| 20 | Land tax | 50% | $4,519 |
| Wife receives | $690,425 | ||
| Net Assets | $693,906 | ||
Standing back, I consider an adjustment of assets and liabilities in that manner to be one that is just and equitable between the parties.
As can be seen by the distribution table, the husband is required to pay the wife $690,425. The husband will be given two months to make those arrangements. If he is unable to do so, then the parties are to join in a sale of the H property and the wife would receive $690,425/990,800 and the husband will receive $300,375/990,800 of the net proceeds of the sale.
CONCLUSIONS / ORDERS
In relation to the H property, the husband disclosed during his oral evidence that he had purported to give an option to the purchaser of the business for a lease of the property after a twelve month rent free period. If the purchaser exercised the option, then it was to be for a three by three year period. If the option was exercised and then if the option was renewed, the husband would have encumbered the property with this lease for a period seven years into the future.
I made an order on the final day of the hearing that the husband, pending further order or the written consent of the wife, not sell, encumber or in any way offer as security or in any other way deal with the H property.
Given that it is agreed that the wife is not in any way involved with whatever arrangements the husband has made to dispose of the business and to grant options in respect of the H property and consequently the wife gave no consent for him to do so, the validity of any option granted by the husband to a purchaser of the business may be dubious.
The H property was originally acquired by the parties as joint tenants (notwithstanding the husband asserted that the parties were divorced at the time). A title produced during the hearing indicated that the property is now held as tenants in common. The wife did not know why that was and the husband offered no explanation as to how the nature of the joint ownership had been changed.
Additionally, the husband disclosed that the certificate of title to the H property was held by Mr X who was the proprietor of a business operating under the name. Mr X was aware of the existence of these proceedings and chose not to intervene. Counsel for the wife submitted that Mr X had no right to hold the certificate of title of the H property and that in respect of the implementation of default orders for the sale of the H property, if the husband is unable to recover the certificate of title to effect the default sale of the property then the wife may need to apply to the Registrar General for the issue of a new certificate of title.
I certify that the preceding three hundred and four (304) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Watts delivered on 30 September 2016.
Associate:
Date: 30 September 2016
SCHEDULE 1
Wife’s evidence in relation to the divorce question
Application for Divorce filed 13 September 2013
Marriage Certificate and translation
Extract translation of Divorce Order (in Lebanon) dated 21 October 2013 (translated 28 October 2013)
Affidavit of the wife filed 20 December 2013
Affidavit of the wife filed 9 January 2014
Affidavit of the wife filed 20 March 2014
Affidavit of the wife filed 5 November 2015
SCHEDULE 2
Husband’s evidence in relation to the divorce question.
Response to Divorce filed 29 October 2013
Affidavit of the husband filed 29 October 2013
Affidavit of the husband filed 24 January 2014
Affidavit of the husband filed 4 August 2016
Affidavit of Mr DD filed 24 January 2014
Affidavit of Ms A filed 24 January 2014 (not read because of non-availability of the witness for cross examination)
Affidavit of Sheikh M (read but subject to weight given un-availability of the Sheikh to be tested in cross examination)
SCHEDULE 3
Documents relied upon by the parties in relation to property
Wife
Initiating Application filed 24 September 2013;
Affidavit filed 11 February 2016;
Affidavit filed 5 November 2015;
Affidavit filed 20 March 2014;
Affidavit filed 9 January 2014;
Affidavit filed 20 December 2013;
Affidavit filed 24 September 2013;
Amended Financial Statement filed 27 July 2016;
Affidavit of Mr OU filed 23 March 2016.
Husband
Response to Initiating Application filed 14 February 2014;
Affidavit filed 4 August 2016;
Affidavit filed 28 September 2015;
Affidavit filed 24 January 2014;
Affidavit filed 29 October 2013;
Financial Questionnaire filed 23 March 2015;
Amended Financial Statement filed 4 August 2016;
Affidavit of Mr V Ahmed filed 28 September 2015; and
Affidavit of Mr OU filed 23 March 2016.
Affidavit of Ms A filed 24 January 2014. (??)
The 2nd respondent
Response to Initiating Application filed 10 October 2015;
Affidavit filed 1 October 2015; and
Affidavit filed 30 August 2016.
Key Legal Topics
Areas of Law
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Family Law
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Property Law
Legal Concepts
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Jurisdiction
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Remedies
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Costs
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Injunction
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Procedural Fairness
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