Benjamin and Bardot

[2008] FamCA 1011

FAMILY COURT OF AUSTRALIA

BENJAMIN & BARDOT [2008] FamCA 1011

FAMILY LAW – CHILDREN – With whom a child spends time – Best interests of child
FAMILY LAW – PROPERTY – Settlement in relation to marriage
FAMILY LAW – CHILD SUPPORT – Application for departure

Family Law Act 1975 (Cth)

Family Law Amendment (Shared Parental Responsibility) Bill Revised Explanatory Memorandum (2006)
Child Support (Assessment) Act 1989 (Cth)
Family Law Rules (2004)

Goode and Goode (2006) FLC 93-277
B and B; Family Law Reform Act 1995 (1997) FLC 92-775
Mazorski v Albright (2007) 37 Fam LR 518
Jones v Dunkel (1959) 101 CLR 298
Patrick Parkinson, “Decision Making about the Best Interests of the Child: The Impact of the Two Tiers” (2006) 20 AJFL 179

APPLICANT: Mr Benjamin

RESPONDENT: Ms Bardot

FILE NUMBER: SYF 4244 of 2006

DATE DELIVERED: 26 November 2008

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: O'Ryan J

HEARING DATE: 14 May, 22 November 2007, 17 January, 6 August, 3, 4, & 5 November 2008

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Schonnel

SOLICITOR FOR THE APPLICANT: Watts McCray Lawyers

COUNSEL FOR THE RESPONDENT: Mr Campton

SOLICITOR FOR THE RESPONDENT: Gayle Meredith & Associates

Orders

Parenting

1. All previous parenting orders be discharged.

2. The Husband and the Wife have equal shared parental responsibility for the long term issues relating to the children, M born on … April 1999 and B born on … June 2001.

3. The children live with the Wife at all times they are not residing with the Husband in accordance with Order 5 hereof.

4. The children also live with the Wife:

   4.1.from 3:00 pm on Christmas Day until 6:00 pm on Boxing Day in 2008 and each alternate year thereafter and from 6:00 pm on Christmas Eve until 3:00 pm on Christmas Day in 2009 and each alternate year thereafter;

   4.2.from 12:00 noon on New Year’s Eve in 2008 until 6:00 pm on New Year’s Day and each alternate year thereafter;

   4.3.from 6:00 pm on Easter Saturday until 6:00 pm on Easter Monday in 2009 and each alternate year thereafter and from 9:00 am on Good Friday until 6:00 pm on Easter Saturday in 2010 and each alternate year thereafter;

   4.4.in the event that Mothers Day does not coincide with a period when the children are living with the Wife in accordance with these orders then from 9:00 am on Mothers Day until before school the following morning;

   4.5.in the event the children are not living with the Wife in accordance with these orders on the children’s birthdays then from after school until 6:00 pm if it is a school day and from 1:00 pm to 5:00 pm if it is a weekend.

5. Subject to Orders 3 and 4 hereof, the children live with the Husband:

   5.1.during the school term on alternate weekends from after school on Friday until before school on the following Monday, commencing the first weekend after school term commences;

   5.2.in each other week during the school term from Wednesday at 6:00 pm until before school on the following Thursday;

   5.3.for half of the school holidays as agreed by the Husband and the Wife, but if no agreement is reached then for the second half in 2008 and each alternate year thereafter and for the first half in 2009 and each alternate year thereafter;

   5.4.from 6:00 pm on Christmas Eve until 3:00 pm on Christmas Day in 2008 and each alternate year thereafter and from 3:00 pm on Christmas Day until 6:00 pm on Boxing Day in 2009 and each alternate year thereafter;

   5.5.from 12:00 noon on New Year’s Eve in 2009 until 6:00 pm on New Year’s Day and each alternate year thereafter;

   5.6.from 9:00 am on Good Friday until 6:00 pm on Easter Saturday in 2009 and each alternate year thereafter and from 6:00 pm on Easter Saturday until 6:00 pm on Easter Monday in 2010 and each alternate year thereafter;

   5.7.in the event that Fathers Day does not coincide with a period when the children are living with the Husband in accordance with these orders then from 9:00 am on Fathers Day until before school the following morning;

   5.8.in the event the children are not living with the Husband in accordance with these orders on the children’s birthdays then from after school until 6:00 pm if it is a school day and from 1:00 pm to 5:00 pm if it is a weekend.

6. Orders 5.1 and 5.2 hereof be suspended during each relevant school holiday period.

7. For the purpose of Order 5, the handover of the children between the Husband and the Wife will take place during school holidays at venues as agreed by the Husband and the Wife and during school term shall be at venues as agreed by the Husband and the Wife and failing agreement in school terms at S School and W School.

8. For the purposes of these orders school holidays are defined as commencing from after school on the last day of school term until the first day of the following school term, not being a pupil free day. 

9. Subject to these Orders, the handover of the children during the school holidays shall be at 6:00 pm.

10. In the event that one of the parents is not able to care for the children for one or more consecutive nights during the time the children live with him or her that party will offer the other party the care of the children during that period before making other arrangements for their care.

11. Each of the parents are restrained from doing any act or thing or saying anything to or in the presence or hearing of any of the children which amounts to a denigration of the other parent or the other parent’s partner.

12. Each of the parents are restrained from doing any act or thing or saying anything to or in the presence or hearing of any of the children which promotes discussion or is likely to promote discussion of any issue in these proceedings .

13. Pursuant to s 65DA(2) and s 62B of the Family Law Act 1975 (Cth), the particulars of the obligations these Orders create and the particulars of the consequences that may follow if a person contravenes these Orders and details of who can assist parties to adjust and comply with an order are set out in the attached Family Law Courts’ Fact Sheet entitled “Parenting Orders – obligations, consequences and who can help” and those particulars are incorporated in these Orders.

Property

Pursuant to s 79 of the Family Law Act

1. By 4:00 pm on 5 December 2008 the Husband and the Wife execute all documents and writings and do all acts and things necessary to cause the proceeds of sale of the property situate at and known as K property currently held in cash management account number … to be paid as follows:

   14.1in payment to the Wife of 47.62 per cent;

   14.2in payment of the balance being 52.38 per cent to the Husband.

2. The Wife be declared the sole legal and beneficial owner of all items of property and superannuation interests in her possession, control or ownership as at the date of this order.

3. The Husband be declared the sole legal and beneficial owner of all items of property and superannuation interests in his possession, control or ownership as at the date of this order.

4. The Wife do all acts and things, execute all documents and writings and pay all monies necessary to indemnify and keep indemnified the Husband against all claims, actions, suits or demands that may be made against the Husband for any liability in relation to or arising out of:

   17.1.the mortgage secured on the Unit in C;

   17.2.any personal guarantees given by the Wife for office plant and equipment;

   17.3.any other liabilities in the sole name of the Wife whether from her position as a director and shareholder of A Holdings Pty Ltd or otherwise including in relation to any loan account in the Company.

5. The Husband do all acts and things, execute all documents and writings and pay all monies necessary to indemnify and keep indemnified the Wife against all claims, actions, suits or demands that may be made against the Wife in relation to or arising out of any liability of any nature which the Husband has in his name either solely, jointly or with any other third person or entity.

Child Support

1. There be a departure in relation to the Husband’s child support liability as assessed by the Child Support Agency so that:

   19.1the Husband pay to the Wife in support of the children M born on … April 1999 and B born on … June 2001 the sum of $2,008.67 per month for the child support period commencing 1 July 2008 until 30 June 2013;

   19.2subsequent to 1 July 2013, the Husband pay to the Wife an administrative assessment of child support in accordance with the provisions of the Child Support (Assessment) Act 1989 (Cth) ;

   19.3the child support referred to in Order 19.1 herein be increased on 1 July of each year by the Child Support Inflation Factor as determined from time to time pursuant to the Child Support (Assessment) Act.

2. There be a departure in relation to the Husband’s child support liability as assessed by the Child Support Agency so that:

   20.1.the Husband pay 67.23 per cent and the Wife pay 32.77 per cent of private school fees and related school expenses and school uniforms referable to the attendance of the child M at S School and the attendance of the child B at W School until completion of each of their secondary schooling and for any extracurricular activities of the children;

   20.2.such non-periodic child support to continue until the happening of a child support terminating event.

3. Any payments of non periodic child support by the Husband pursuant to these orders not be credited against any periodic support payable by the Husband in respect of the said children pursuant to any administrative assessment issued by way of Order 19.1 hereof.

4. It be noted that the departure orders are made on the following grounds:

   22.1.in special circumstances of the case the assessment has resulted in an unjust and inequitable determination of the level of child support because of the income, earning capacity and financial resources of the Husband and the Wife, s 117(2)(c)(ib) Child Support Assessment Act;

   22.2.in the special circumstances of the case the costs of maintaining the children are significantly affected because the children are being cared for and educated in the manner that was expected by their parents, s 117(2)(b)(ii) Child Support Assessment Act.

IT IS NOTED that publication of this judgment under the pseudonym Benjamin & Bardot is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYF 4244  of 2006

MR BENJAMIN

Applicant

And

MS BARDOT

Respondent

REASONS FOR JUDGMENT

INTRODUCTION

1. Before me for hearing are applications for final parenting and property orders. 

2. The Husband is Mr Benjamin who was born in September 1953.  The Wife is Ms Bardot who was born in April 1964.  The parties were married in March 1998 and separated in January 2006.  The parties were divorced on 4 June 2007.

3. There are two children of the relationship, M born in April 1999 and B born in June 2001. The children live primarily with the Wife and spend five days a fortnight during school terms with the Husband and otherwise have equal time with each of their parents during school holidays.

4. The Husband sought the following which was set out in a minute of order filed in Court on 3 November 2008:

   1.The Husband and the Wife forthwith do all acts and things and sign all documents necessary to release the proceeds of sale of the Husband’s [K] property, held in Commonwealth Bank of Australia account number […] in the proportions of 88.5% to the Husband and 11.5% to the Wife.

   2.Each party retain any real or personal property standing in their respective names as at the date of these Orders, and indemnify each other in relation to any liabilities they respectively have. 

   Parenting

   3.The parties have equal shared parental responsibility for the long term issues relating to the children [M] born […] April 1999 and […] born […] June 2001 (“the children”), it being noted that before and after school care arrangements for the children are not matters at forth in the concept of “major long term issues”. 

   4.The children live with the Wife.

   5.The children live with the Husband at the following times:-

   5.1    During school term on alternate weekends from after school on Thursdays until before school on Mondays, commencing the first four weekend after school term commences;

   5.2    Each Wednesday from 6.00pm until before school on Thursday;

   5.3    For half of the school holidays commencing with the first term holidays in 2009 as agreed and otherwise for the first half of the holidays in 2009 and each alternate year thereafter and for the second week in 2010 and each alternate year thereafter.

   6.For the purpose of order 5 handover of the children will take place during school holidays at venues as agreed, and during school term shall be at venues as agreed and failing agreement in school terms at [S School].

   7.School holidays are defined as commencing from after school on the last day of school term until the first day of school (not being a pupil free day).  Handover during school holidays shall be at 5.00pm on the middle day of the holidays, where applicable in these Orders, and the parties shall have an equal number of nights.

   8.In the event that the children are not otherwise in the care of the Wife on Mother’s Day, the children will spend time with the Wife on Mother’s Day from 9.00am to before school on the following morning.

   9.In the event that the children are not otherwise in the care of the Husband on Father’s Day the children will spend time with the Husband on Father’s Day from 9.00am until before school the following morning.

   10.The parent that who does not otherwise have care of the children on their birthdays will spend time with the child from after school until 6.00pm if it is a school day and from 1.00pm to 5.00pm if it is a weekend. 

   11.In the event that one of the parties is not able to care for the children for one or more consecutive nights during the time the children live with him or her that party will offer the other party the care the children during that period before making other arrangements for their care. 

   Child Support Departure

   12.Pursuant to Section 117 of the Child Support (Assessment) Act 1989 there be a departure in relation to the administrative issue by the Child Support Agency on 23 April 2007 whereby the Husband’s periodic child support be fixed in the sum of $500.00 per month for the period 22 February 2007 to 31 December 2012.

   13.That the Husband and the Wife be responsible for all private school fees and related expenses including after school care and extra curricular activities for the children in equal proportions. 

5. The Wife sought the following orders as set out in her Amended Response to Application for Final Orders filed on 25 June 2007:

   Parenting

   1.That the interim orders made on 21 December 2006 are made on a final basis.

   Property Settlement

   2.That the Husband and the Wife do all acts necessary to cause the proceeds of sale of the [K] property held in cash management account number […] to be paid as follows:

   2.1.   in payment to the Wife of the sum of $830,739;

   2.2.   in payment of the balance to the Husband.

   3.That as against the Husband, the Wife is the sole legal and beneficial owner of the following:

   3.1.   the [C] property;

   3.2.   her shares in Strata Mining Corporation Limited and IAG shares;

   3.3.   her interest in [A Holdings] Limited including any funds owed to the Wife by [A Holdings] Limited;

   3.4.   the Wife’s jewellery;

   3.5.   all property both real and personal in the Wife’s ownership, possession and/or control including but not limited to all or any money standing to the credit of the Wife in any bank or building society, shareholdings, motor vehicles and entitlements to superannuation.

   4.That as against the Wife, the Husband is the sole legal and beneficial owner of the following:

   4.1.   his shareholding in […] Investments Pty Limited;

   4.2.   his shareholding with […] Capital Pty Limited;

   4.3.   his shareholding in [P] Pty Ltd;

   4.4.   the contents he retained from the [K] property;

   4.5.   all items of personal and real property both real and personal in the Husband’s ownership, possession and/or control including but not limited to all or any money standing to the credit of the Husband in any bank or building society, shareholdings, motor vehicles and entitlements to superannuation.

   5.That the Wife indemnify and keep indemnified the Husband against any liability of any nature which the Wife has at any time arising in respect of the following liabilities:

   5.1.   the mortgage secured on the [C] property;

   5.2.   any personal guarantees given for the office plant and equipment by the Wife;

   5.3.   any other liabilities in her sole name whether from her position in the company [A Holdings] Limited or otherwise including in relation to any loan account in the company.

   6.The Husband shall indemnify and keep indemnified the Wife against any liability of any nature which the Husband has in his name either solely, jointly or with any other third person or entity.

6. On 4 November 2008 I was handed a minute in which the following was set out:

   1.That the parties have equal shared parental responsibility for the long term issues relating to the children, [M] born […] April 1999 and [B] born […] June 2001 (“the children”).

   2.That the children live with the wife at all times they are not residing with the husband in accordance with Order 3 herein, and:

   2.1    from 6.00 pm Christmas Eve until 3.00 pm Christmas Day in 2009 and each alternate year thereafter and from 3.00 pm Christmas Day until 6.00 pm Boxing Day in 2008 and each alternate year thereafter;

   2.2    from 12.00 noon New Year’s Eve until 6.00 pm New Year’s Day in 2008 and each alternate year thereafter;

   2.3    from 6.00 pm Easter Saturday until 6.00 pm Easter Monday in 2009 and each alternate year thereafter and from 9.00 am Good Friday until 6.00 pm Easter Saturday in 2010 and each alternate year thereafter;

   2.4    from 9.00 am Mothers Day until before school the following morning;

   2.5    in the event the children are not with the wife on the children’s birthdays, from after school until 6.00 pm if it is a school day and from 1.00 pm to 5.00 pm if it is a weekend.

   3.Subject to Order 2 herein, that the children live with the husband:

   3.1    during school term on alternate weekends from after school on Friday (wife says) / Thursday (husband says) until before school on Mondays, commencing the first weekend after school term commences;

   3.2    in each other week during school term from Wednesday from 6.00 pm until before school on Thursday/Friday;

   3.3    subject to Orders 3.4 – 3.6 herein, for half of the school holidays as agreed, but if no agreement, the first half in 2009 and in each alternate year thereafter and the second half in 2008 and each alternate year thereafter;

   3.4    from 6.00 pm Christmas Eve until 3.00 pm Christmas Day in 2008 and each alternate year thereafter and from 3.00 pm Christmas Day until 6.00 pm Boxing Day in 2009 and each alternate year thereafter;

   3.5    from 12.00 noon New Year’s Eve until 6.00 pm New Year’s Day in 2009 and each alternate year thereafter;

   3.6    from 6.00 pm Easter Saturday until 6.00 pm Easter Monday in 2010 and each alternate year thereafter and from 9.00 am Good Friday until 6.00 pm Easter Saturday in 2009 and each alternate year thereafter;

   3.7    from 9.00 am Fathers Day until before school the following morning;

   3.8    in the event the children are not with the husband on the children’s birthdays, from after school until 6.00 pm if it is a school day and from 1.00 pm to 5.00 pm if it is a weekend.

   4.For the purpose of Order 3 herein, handover of the children will take place during school holidays at venues as agreed and during school term shall be at venues as agreed and failing agreement in school terms at [S School] and [W School].

   5.School holidays are defined as commencing from after school on the last day of school term until the first day of school, not being a pupil free day.  Subject to these Orders, handover during the school holidays shall be at 6.00 pm.

   6.In the event that one of the parties is not able to care for the children for one or more consecutive nights during the time the children live with him or her that party will offer the other party the care of the children during that period before making other arrangements for their care.

1. In the parenting proceedings the Husband sought that the children live with him for one extra night each fortnight during the school term.  The Wife opposed such relief and sought that Interim Orders made on 21 December 2006 be made into Final Orders.  The issues relate to paragraphs 3.1 and 3.2 of the above minute. 

2. It will be seen later that for the purposes of the property settlement applications I have determined that the parties have assets, including superannuation interests, of a net value of $1,829,354.

3. In the property proceedings the Husband contended that the contribution based entitlements of each party expressed as a percentage of the net assets of the parties should be assessed as to 70 per cent to the Husband and 30 per cent to the Wife.  The Husband contended that the only matter that called for any adjustment in relation to the “other factors” related to the care of the children and any such adjustment would be modest.  The Husband submitted that any such adjustment would be measured by no more than five per cent.  The Husband sought that he receive an entitlement as to 65 per cent and the Wife receive 35 per cent.  The Wife contended that I would find the contributions based entitlements of each party as to 57.50 per cent to the Wife and 42.50 per cent to the Husband.  The Wife contended that I would find that there should be a further adjustment in her favour of 10 per cent.  In the result the Wife would have an entitlement to 67.50 per cent of the net assets and the Husband 32.50 per cent.

4. In the child support proceedings the costs of supporting and educating the children were agreed and the only issue that arose related to the extent of the contribution to be made by each party towards the costs.

5. On 23 November 2007 directions were made for the filing of affidavits to be limited to the items of controversy in respect of the current assets and liabilities of the parties, the items of controversy with respect to the assets at the commencement of cohabitation and lastly to deal with the contributions that each party made during their relationship and since the date of separation.  The way the affidavit material has been drafted and prepared it was apparent that the principle issues were the extent of each party’s initial contributions, the weight that should be placed upon such initial contributions and the contributions of the parties in the period post separation to the date of the trial.  In relation to the parenting proceedings no directions were made for the filing of affidavits.

6. The Wife sought to rely upon an adversarial expert as to the value of a home unit at C owned by her at the commencement of cohabitation.  A single expert had been appointed and the Wife recently filed an application for permission to call evidence from an adversarial expert. The Husband opposed the Wife relying upon an adversarial expert.  I rejected the application by the Wife.

7. According to the Husband’s costs memorandum he had total legal costs and expenses of $137,533.86.  He had paid $122,879.49.  According to the Wife’s costs memorandum she had total anticipated legal costs and expenses of $194,284.49.  She had paid $127,955.22.  Thus according to the costs memorandums the total costs were approximately $332,000 of which the parties had already paid approximately $251,000.  The total anticipated legal costs represented approximately 18 per cent of what I have found to be the net assets of the parties.

PARENTING-RELEVANT PRINCIPLES

1. For a discussion of the relevant provisions of Pt VII of the Family Law Act 1975 (Cth) see Goode and Goode (2006) FLC 93-277.

2. Section 61C(1) in Pt VII of the Family Law Act provides that each of the parents of a child who has not attained the age of 18 has parental responsibility for that child.  The meaning of “parental responsibility” is defined in s 61B of the Act.  Parental responsibility means all the duties, powers and authority which by law parents have in relation to a child.  It relates to decision-making, not time to be spent with each parent.  The presumption relates only to parents, and has no application to orders for parental responsibility in favour of other people.  In Goode and Goode (supra) the Full Court said that the parents may still be together or may be separated; there will be no court order and the parents may exercise the responsibility either independently or jointly. 

3. However, by virtue of s 61C(3) the joint parental responsibility is subject to any order I may make.  Section 61D(1) provides that a parenting order confers parental responsibility for a child on a person but only to the extent to which the order confers on the person duties, powers, responsibilities or authority in relation to the child.

4. Section 65D(1) provides, subject to a presumption of equal  shared  parental  responsibility in s 61DA, parenting plans and Div 6 of Pt VII, that I may make such parenting order as I think proper.  Section 64B(1) defines the term “parenting order” and s 64B(2) specifies the matters that a parenting order may deal with.  This includes the person with whom a child is to live, the time a child is to spend with another person and the allocation of parental responsibility for a child.  Section 64B(3) provides that an order may deal with allocation of responsibility for making decisions about long-term issues.

5. In deciding whether to make a particular parenting order in relation to a child s 60CA requires that I regard the best interests of the child as the paramount consideration: see also s 65AA.

6. In determining what is in the best interests of a child I must consider the primary considerations in s 60CC(2) and the additional considerations in s 60CC(3).  There are two primary considerations and 13 additional considerations.  I must also have regard to the objects of Pt VII identified in s 60B(1) and the principles expressed in s 60B(2) underlying the objects.

7. There are four stated objects in s 60B(1) to ensure that the best interests of children are met.  These objects are, first, by ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child; second, by protecting children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence; third by ensuring that children receive adequate and proper parenting to help them achieve their full potential; and fourth, by ensuring that parents fulfil their duties, and meet their responsibilities, concerning the care, welfare and development of their children.

8. There are five principles specified in s 60B(2) and they are, except when it is or would be contrary to the best interests of a child.  First, that children have a right to know and be cared for by both parents; second, that children have a right to spend time on a regular basis with, and communicate on a regular basis with, both their parents and other people significant to their care, welfare and development; third, that parents jointly share duties and responsibilities concerning the care, welfare and development of their children; fourth, that parents should agree about the future parenting of their children; and fifth, that children have a right to enjoy their culture, including the right to enjoy that culture with other people who share that culture.  Section 60B(3) deals with the right of an Aboriginal or Torres Strait Islander child to enjoy his or her Aboriginal or Torres Strait Islander culture.

9. For a discussion of s 60B prior to the significant amendments in July 2006 see B and B; Family Law Reform Act 1995 (1997) FLC 92-775. It has been suggested that the objects section now needs to be “given a central place in the interpretation of Part VII of the Act, and this includes how Court’s should reach conclusions about what would be in the best interests of the children who are the subject of decision making”: see Patrick Parkinson, “Decision Making about the Best Interests of the Child: The Impact of the Two Tiers” (2006) 20 AJFL 179; see also the Family Law Amendment (Shared Parental Responsibility) Bill Revised Explanatory Memorandum (2006). Parkinson also suggests that the objects provide much more guidance than previously about how to decide disputes about post separation parenting arrangements.

10. As to the two primary considerations, the first is the benefit to the child of having a meaningful relationship with both parents.  The second is the need to protect the child from physical or psychological harm from being subjected to or exposed to abuse, neglect or family violence.  The terms “abuse” and ‘”family violence” are defined in s 4 of the Act.

11. Without repeating all of the 13 additional considerations they include the views of the child, the nature of the relationship of the child with each of the parents, the willingness and ability of each of the parents to facilitate and encourage a close and continuing relationship between the child and the other parent and the attitude to the child and to the responsibilities of parenthood demonstrated by each of the parents. 

12. For a helpful discussion about the interpretation of s 60CC and the relationship between the primary and additional considerations see Butterworths, Australian Family Law, vol 1 at [s 60CC.10] - [s 60CC.27].  Parkinson also comments (supra) at p 181 that consideration of the additional considerations will usually amplify the primary ones at another level of detail or put another way, a detailed examination of the additional considerations may assist in determining the significance of the primary considerations and the orders to make.  I observe that in Mazorski v Albright (2007) 37 Fam LR 518 Brown J dealt with the additional considerations (at 543-550) before her Honour dealt with the primary considerations (at 550- 551).

13. Section 60CG requires that I ensure that any order I make is consistent with any family violence orders and does not expose a person to an unacceptable risk of family violence, to the extent that doing so is consistent with the child’s best interests being treated as paramount.

14. Section 61DA(1) provides that when making a parenting order I must apply a presumption that it is in the best interests of the child for the parents to have “equal shared parental responsibility” for the child.  It is a presumption that relates solely to the allocation of parental responsibility as defined in s 61B.  It is not a presumption about the amount of time a child spends with each parent.  The presumption does not apply in certain circumstances.

15. Section 65DAC deals with the effect of a parenting order that provides for shared parental responsibility and specifies that the exercise of that parental responsibility involves making a decision about a major long-term issue in relation to the child.  Section 65DAC(2) provides that the order is taken to require that the decision is to be made jointly by the persons who have shared parental responsibility.  The term “major long term issues” is defined in s 4 and includes issues relating to education and religious upbringing.  However, s 65DAE makes clear that a shared parental responsibility order does not require consultation about issues that are not major long term issues unless a contrary order was made. 

16. In Goode and Goode (supra) the Full Court said that there is a difference between parental responsibility which exists as a result of s 61C and an order which has the effect set out in s 65DAC.

17. Section 61DA(2) provides that the presumption of equal shared parental responsibility does not apply if there are reasonable grounds to believe that a parent or a person who lives with a parent has engaged in child abuse or family violence.  Further, s 61DA(4) provides that the presumption may be rebutted if I was satisfied that it would not be in the best interests of the child for the parents to have equal shared parental responsibility.  In summary, if the presumption does not apply or is rebutted then I must determine, without any presumption, what order relating to parental responsibility, if any, would be in the child’s best interests, applying s 60CC and s 60B.

18. If I am satisfied that the presumption of equal shared parental responsibility does apply then by s 65DAA(1) I have to consider whether it would be in the best interests of the child to spend equal time with each parent and whether it is reasonably practicable for the child to spend equal time with each parent.  If both conditions are satisfied I then must consider making an order for the child to spend equal time with each parent.  In determining the first matter, namely whether it would be in the best interests of the child to spend equal time with each parent, I have to apply s 60C and s 60B.  In determining the second matter, namely whether it is reasonably practicable, I am required to consider the matters in s 65DAA(5).

19. If I am satisfied that the presumption of equal shared parental responsibility does apply but that an order not be made for the child to spend equal time with each parent then by s 65DAA(2) I have to consider whether it would be in the best interests of the child to spend substantial and significant time with each parent and whether it is reasonably practicable for the child to spend substantial and significant time with each parent.  If both conditions are satisfied then I must consider making an order for the child to spend substantial and significant time with each parent.  Again, in determining the first matter namely whether it would be in the best interests of the child to spend substantial and significant time with each parent I have to apply: s 60C  and  s 60B.  In determining the second matter, namely whether it is reasonably practicable I have to consider the matters in s 65DAA(5).  Section 65DAA(3) sets out what is meant by substantial and significant time.

20. In Goode and Goode (supra) the Full Court said that in the event that neither the concept of equal time nor substantial and significant time “delivers an outcome that promotes” the best interests of a child then “the issue is at large and to be determined in accordance with” the best interests of the child.  The best interests of a child are determined by consideration of the matters in s 60B and s 60CC. 

21. In conclusion, as Brown J said in Mazorski v Albright (supra) at 523 the Act places far more emphasis on the importance of substantial parental involvement in their children’s lives. Her Honour said, with which I agree, at 524:

    “[15]…There is no doubt that the objects and principles, primary considerations (and a number of the additional considerations) and various statutory provisions relating to the presumption of equal shared responsibility, and the consequences of the presumption’s application, require the court to focus on the importance of maintaining a meaningful relationship between a child and both parents, and on the importance of a child spending substantial and significant time with a parent in order to achieve that aim”.

    and at 526:

    “[26]   What these definitions convey is that “meaningful”, when used in the context of “meaningful relationship”, is synonymous with “significant” which, in turn, is generally used as a synonym for “important” or “of consequence”.  I proceed on the basis that when considering the primary considerations and the application of the object and principles, a meaningful relationship or a meaningful involvement is one which is important, significant and valuable to the child.  It is a qualitative adjective, not a strictly quantitive one.  Quantitive concepts may be addressed as part of the process of considering the consequences of the application of the presumption of equally shared parental responsibility and the requirement for time with children to be, where possible and in their best interests, substantial and significant”.

RELEVANT PROPERTY SETTLEMENT PRINCIPLES

1. The approach to the determination of an application pursuant to s 79 of the Family Law Act is well established by authority. Section 79(2) provides that I shall not make an order, under the section, unless I am satisfied, in all the circumstances, that it is just and equitable to make the order. I am required, in considering what order, if any, I should make, to take into account the respective contributions of the parties referred to in paragraphs (a), (b) and (c) of s 79(4); the effect of any proposed order upon the earning capacity of the parties; the matters referred to in s 75(2), so far as they are relevant; any other order made under the Act affecting a party or a child, and any child support under the Child Support (Assessment) Act 1989 (Cth).

2. There is a preferred approach to the determination of such an application which involves four inter-related steps. The first step is that I have to make findings as to the identity and value of the assets of the parties at the date of the hearing. The second step is that I have to identify and assess the contributions of the parties within the meaning of paragraphs (a), (b) and (c) of s 79(4) and determine the contribution based entitlements of each party expressed as a percentage of the net value of the assets of the parties. The third step is that I have to identify and assess the matters referred to in paragraphs (d), (e), (f) and (g) of s 79(4)(d). Pursuant to s 79(4)(e), this includes consideration of the matters in s 75(2). I have to determine the adjustment if any that should be made to the contribution based entitlements of each party established at the second step. The fourth step is that I have to consider the effect of my findings and determinations in relation to the first three steps and resolve what order, in all the circumstances of the case, it is just and equitable to make.

BACKGROUND

1. In March 1993 the Wife acquired a unit in C, which I will refer to as the C Unit, for $286,000.  To pay the costs the Wife obtained a mortgage loan for $256,000 from her mother and stepfather.  The mortgage was registered on 24 March 1993.  Pursuant to the terms of the mortgage agreement the Wife was required to repay the principle sum at the rate of $600 per month for a period of 18 months and then at a rate of $800 per month to be made in four payments each year until the principle sum was fully repaid.  The agreement provided that if the Wife failed to make any of the payments of the principle sum then she was to pay interest to her mother and stepfather at the rate of 10 per cent per annum.  In addition to the advance of $256,000 the Wife’s mother and stepfather paid the stamp duty of $9,473 and also the legal costs and disbursements relating to the purchase. The Wife has not paid her mother and stepfather any of the repayments of the principle sum.  The Wife has paid some interest.

2. Upon completion of the purchase of the C unit the Wife commenced to reside in the property.  She remained living in the property until the Husband and the Wife commenced to reside in the former matrimonial home at K.

3. At the time of the purchase of the C unit the Wife was employed by the New South Wales Government earning about $50,000 per annum.  In about 1994 the Wife was retrenched from her employment and thereafter commenced her own consulting business.

4. The Husband contended that before cohabitation his late mother transferred the majority of her assets to her four children to avoid paying death duties in the United Kingdom.  The Husband contended that his mother transferred to him a portion of her share portfolio, managed by a firm of share brokers in London called S Brokers Ltd.  The Husband contended that as at March 1998 the portfolio was valued at about £73,244.75 or $182,378.  Any dividends, which the Husband received from the share portfolio, were paid into an account with the Nationwide Bank in the United Kingdom for the purposes of supporting his mother.  The Husband contended that he could not draw any money from this bank account without his mother’s consent and signature.  As at October 2007 the bank account balance was about $8,850.  The Husband contended that the current value of the United Kingdom share portfolio is $32,527.

1. In January 1996 the Husband established Investments Pty Ltd with Mr T.  Each of the Husband and Mr T are the only directors and shareholders of the Company and they each own 9,300 shares.  The Company is used to engage in public listed company share trading. 

2. In October 1996 the Husband purchased a property at K, which I will refer to as the “K property”, for a price of $400,000.  To pay the cost he obtained a mortgage loan from the Commonwealth Bank of Australia for $350,000.

3. There was put in evidence a copy of the loan application which the Husband made to the Commonwealth Bank when he sought the loan to enable him to pay for the cost of purchase of the K property.  The Husband did not disclose in the loan application the ownership of any shares in the United Kingdom.

4. The parties were married in March 1998. 

5. The Husband contended that at the date of marriage he had the following assets:

   $

   ·K property  500,000

   ·Shares in Investments Pty Ltd  25,339

   ·United Kingdom share portfolio   182,378

   ·Australian share portfolio   23,013

   ·Commonwealth Bank account   7,556

   ·ASGARD Personal Superannuation interest  7,415

   ·MLC Superannuation interest  34,114

   ·Liberty Life policy  16,524

   ·Liberty Life policy  1,128

   ·Subaru Liberty 1993 motor vehicle  10,000

   ·Inflatable boat and motor & trailer   3,000

   ·Home contents  -

   ·Jewellery and silverware   -

   The Husband had a mortgage debt for $311,688 secured on K property.

6. In examination in chief, the Husband gave evidence that on 2 March 1998 he withdrew $10,874 from his bank account to pay for the parties’ honeymoon.  The Wife gave evidence, which I accept, that her parents paid for the costs of the wedding.

7. In his income tax return for the financial year ended 30 June 1998 the Husband identified his employer as LP Holdings Ltd and his occupation was described as analyst. 

8. The value of ₤73,244.75 or $182,378 which the Husband contended for his shares in the United Kingdom was based on a document that was annexed to an affidavit he swore on 29 October 2008.  The document purported to be a valuation of shares as at 13 March 1998.  The Wife submitted that the Husband’s evidence as to the circumstances of his receipt of such share portfolio was inconclusive and without evidentiary foundation.  The Husband elected not to call evidence as to the arrangement between his mother, his siblings and himself from the date of the contended agreement, until the date of the death of the Husband’s mother in the United Kingdom on 26 August 2006, save as to paragraphs 7 and 8 of his affidavit; and elected that his three siblings, who were parties to the arrangement on the same terms as the Husband, would not give evidence in the Husband’s case.  The Wife submitted that in the circumstances such evidence would naturally form part of the Husband’s case, and that an inference consistent with the type identified by the High Court in Jones v Dunkel (1959) 101 CLR 298 should be drawn against the Husband. The Wife submitted that the Husband’s evidence at its highest would be that while he may have held the beneficial entitlement to the capital of the share portfolio, any income received from the share portfolio was beneficially held, and in fact utilised and applied, by his mother in the United Kingdom until her death. At its highest, the Husband’s evidence was that the share portfolio was an asset available for distribution valued at $32,527 and otherwise the proceeds of that share portfolio by way of income was inherited by the Husband by way of his mother’s estate and exists in specie in a United Kingdom bank account in the sum of $8,850.  The Wife contended that it was probative that the Husband failed or neglected, notwithstanding he was a beneficiary of his mother’s estate, to disclose the accounts of the estate which formed the foundations for the grant of probate in the United Kingdom and thereafter verifying the distribution of the estate.

9. In summary, the Wife put into issue the fact of the legal ownership by the Husband of the portfolio of shares in the United Kingdom as at the date of cohabitation, and in the alternative, the beneficial ownership or entitlement to the capital of such share portfolio and the income created from it.  The Wife submitted that representations made by the Husband to third parties including revenue authorities and financial institutions during the course of the marriage supported her contentions, and concessions made by the Husband’s solicitors on instructions also supported such contentions.  As well a forensic investigation by Mr G, Chartered Accountant supported such contentions.   The Wife submitted that any issue as to the Husband’s share portfolio in the United Kingdom attracting weight in concluding a finding as to contribution was limited to that available by way of the inclusion of the United Kingdom Nationwide Bank account in the sum of $8,850 and the S Brokers United Kingdom share portfolio in the sum of $32,527 received by the Husband post separation.  

10. There was put into evidence a copy of the Husband’s income tax return for the year ended 30 June 1998.  The Husband did not disclose receiving dividends or any capital gains from any shares owned in United Kingdom publicly listed companies.  In the tax return in respect of whether or not he had a direct of indirect interest in a foreign entity or a foreign source of income or foreign assets or property the Husband said no. 

11. The Husband swore his affidavit of evidence in chief on 18 September 2008.  On 29 October 2008 he swore a further affidavit.  On 4 November 2008 I granted leave to the Husband to rely upon this second affidavit.  In this second affidavit the Husband gave more detailed evidence in relation to the shares in the United Kingdom and attempted to deal with a number of the issues raised by the Wife.  No evidence was given by the Husband explaining why the evidence in the affidavit of 29 October 2008 had not been given before.  In summary the orders I previously made for filing affidavits were ignored.  In his affidavit of 29 October 2008 the Husband testified that during the marriage he received the following amounts from the sale of shares in the United Kingdom:

    $

    ·04/07/03  44,232.74

    ·       18/02/04  12,010.00

    ·       06/04/04  16,765.00

    ·       13/05/04  15,667.00

    Total  88,674.74

12. It follows that what the Husband said about the value of the shares he owned in United Kingdom publicly listed companies at the commencement of cohabitation was irrelevant.  As well consistent with what the Husband represented in his income tax returns filed with the Australian Taxation Office I am going to proceed on the basis that the Husband did not have a beneficial entitlement to any shares in United Kingdom publicly listed companies.  However, I accept that what was relevant was the amounts that the Husband contended he received during cohabitation from the proceeds of sale of shares in such companies.  I also observe that the Husband gave no evidence of share trading prior to 4 July 2003 in relation to shares in United Kingdom publicly listed companies.  I accept that during the relationship by way of a gift from his late mother the Husband received certain amounts which were sourced from the proceeds of sale of shares in United Kingdom publicly listed companies. 

13. The Husband contended that he also held shares in Australian publicly listed companies at the time of the marriage valued at $23,013.  The shares were subsequently sold over a two year period from June 1998 to August 2000 for $27,071.  The Husband contended that at the date of marriage he owned shares in Santos Ltd, North Broken Hill Ltd, Telstra Corporation Ltd, Newcrest Mining Ltd, Westfield American Trust and TAB Ltd.  The Wife contended that at the date of marriage the Husband owned shares in Santos Ltd, North Broken Hill Ltd and Telstra Corporation Ltd.  The Husband had no records as to the number of shares he held in each particular publicly listed entity, or their value at the time of cohabitation.  The documents he relied upon to support the contention as to the particulars of the portfolio were grounded in his handwritten notes on bank statements.  There was put in evidence a copy of the Husband’s income tax return for the year ended 30 June 1998 in which the Husband disclosed that he received dividends from his shares in Santos Ltd, North Broken Hill Ltd and Telstra Corporation Ltd but not from any of the other shares.  The Wife conceded the value of the Australian share portfolio of the Husband at cohabitation of $18,386.  The Wife relied upon the Husband’s disclosures in his income tax return as at 30 June 1998 to support her contention.  I prefer the evidence of the Wife.

14. The Husband contended for the year ended 30 June 1998 Investments Pty Ltd had a total equity of $16,989.  The Husband contended that his total interest in the Company was $25,340 which included a loan of $16,858.50 he made to the Company.  The Wife contended that throughout the marriage the Husband engaged in share trading activities on behalf of Investments Pty Ltd.  The Husband produced copies of the financial accounts of the Company for the financial years ended 30 June 1998, 30 June 2002, 30 June 2003, 30 June 2004, 30 June 2005, 30 June 2006 and 30 June 2007.  He did not produce a copy of the financial accounts for the financial years ended 30 June 1999, 30 June 2000 and 30 June 2001.  As well he produced a copy of income tax returns.  In each of the financial accounts which were provided for the years specified above, the accounts revealed either a nil profit or a trading loss.  For example, in the year ended 30 June 2005 there was a loss of $40,103.  There was no evidence of any financial benefits received by the Husband either directly or indirectly at any time from Investments Pty Ltd.  However, notwithstanding that there were a number of trading losses there was no evidence that during cohabitation or after separation the Husband continued to provide funds to the Company.

15. The Wife contended that at the date of marriage she had the following assets:

    $

    ·       C Unit  375,000

    ·       Monies in bank accounts  10,497

    ·       Superannuation interest  8,950

    ·       Shares   33,111

    ·       Business know as U Business  15,063

    ·       Furniture, household effects and jewellery   -

    The Wife had a debt for $256,000 in respect of the C unit. 

16. There was an issue about the value of the C unit.  The single expert Mr O retrospectively opined as to the value of the unit as at the date of the marriage at $375,000.  The real estate valuation expert retained by the Wife Mr N, retrospectively valued the C unit at $430,000.  I rejected the evidence of Mr N however I did not accept that it was necessary for me to make a finding as to the value in early 1998. 

17. As to the mortgage loan the Wife obtained from her mother and stepfather, the mortgage agreement only required payment of the principle amount and no interest was payable if the principle was repaid in accordance with the terms of the mortgage.  The Husband did not put into issue the fact of the mortgage entered into between the Wife, her mother and stepfather on 23 March 1993 secured upon the C unit.  The Husband testified that he never knew the Wife to make any mortgage repayments and that the quarterly principle payments have been in arrears consistently since 1993.  The documents exhibited by the Wife to her affidavit, including representations to Commonwealth revenue authorities, supported a finding that some interest was paid by the Wife to her mother during the period of the marriage.  There was no issue between the parties that interest was payable pursuant to the terms of the mortgage document.  There was no issue that any failure of the Wife to pay interest to her mother constituted a gift made by the Wife’s mother to the Wife during the marriage.  The Wife contended, and it was not disputed, that quantification of any “gift” of interest during the marriage was $370,588.  There was also no issue that the principle of the mortgage debt due was a liability in the balance sheet of current net assets.  However, the Wife did not seek that a liability for interest accruing on the mortgage be included in the balance sheet.

18. At the date of marriage the Wife was conducting her own business trading as U Business.  The assets of the business at the time included shares in publicly listed companies, office furniture and equipment and also cash in the bank of $7,124.76.  The financial statements of the Wife’s business as a sole trader were exhibited to her affidavit.  The business owned furniture and equipment and cash in the bank, having a recorded value in the accounts of $15,062.94.  There was no goodwill in the business as it depended upon the Wife’s expertise to obtain clients and work in the business.  The business had no liabilities.  The Wife contended, and I accept, that the value of the net assets of the business in addition to the shares that she owned was $15,062.94.

19. The Husband conceded the Wife’s share portfolio forming part of the balance sheet of her business known as U Business in the sum of $30,519.  However he contended that these shares were an asset of A Holdings Pty Ltd trading as U Business as disclosed in a financial report for 30 June 1998 of the business.  The Wife contended the shares had a value of $33,110.95 and there was put in evidence a document showing historical share prices for the shares that she owned as at 6 March 1998 and the total value was $33,110.95.  The Wife no longer owns any of the shares that she owned at the date of marriage.  Between February 2005 and February 2006 she sold her shares for a total of $64,946.38.  During the relationship the Wife also received from her stepfather a gift of shares in the Commonwealth Bank of Australia and BHP Billiton.  The Wife also received shares in Bluescope Ltd and One Steel Ltd and at one time was allotted shares in NRMA.  The Wife sold the shares in late 2005 for a total of $15,406.95.  The Wife sold shares for a total of $80,353.33. 

20. During the relationship the Wife’s mother purchased clothes and furniture for the children including a bedroom setting for the child M.  As well, the Wife and her mother paid deposits and confirmation fees to secure places for the children at the school which they currently attend.

21. Upon commencement of cohabitation the parties lived in the home owned by the Husband at K. 

22. In November 1998 the Wife became the sole director of A Holdings Pty Ltd.  The Wife was also the owner of all of the issued capital.  Since November 1998 the Company has owned and operated the business known as U Business.

23. The parties lived in the K property until early 1999 when they moved into the Wife’s unit at C.  The parties resided in the C unit for approximately 18 months whilst renovations were undertaken to the K property.  Thereafter, in approximately August 2000, the parties moved back into the K property where they remained living until the date of separation.

24. To assist with payment of the cost of the renovations to the K property the parties obtained a mortgage loan from the Commonwealth Bank.  There was put in evidence a copy of the loan application in respect of the loan and the Husband did not disclose in the application the ownership of any shares in the United Kingdom. 

25. There was put in evidence a copy of the Husband’s income tax return for the financial year ended 30 June 1999 and he did not disclose receiving any dividends or any capital gains from any shares owned in United Kingdom publicly listed companies.  The Husband did not produce in the current proceedings a copy of any income tax returns lodged by him in the United Kingdom.

26. The Husband did produce in the current proceedings contract notes of S Brokers Ltd in London addressed to “[Mr Benjamin] Esq. Dealing Account” which disclosed the purchase and sale of shares between July 2003 and June 2008.  The Husband however did not disclose any dividends or capital gains from shares owned in the United Kingdom in any income tax returns lodged with the Australian Taxation Office until the year ended 30 June 2004 when he disclosed a capital gain from the sale of certain shares.

27. The Wife’s mother lent the parties $12,000 to pay for landscaping at the K home and also gave the parties a gift of $5,000 that was used to pay for rendering.  The amount of $12,000 was recently repaid from the proceeds of sale of the K home pursuant to orders which were made by me on 6 August 2008. 

28. The Wife spent a significant amount of time meeting with and coordinating trades people and spent most daytime hours on weekends together with the Husband selecting fixtures and finishes for the renovations to the K property.

29. In about April 1999 the Wife ceased working.  In April 1999 the child M was born.

30. When the Wife ceased work shortly prior to the birth of the child M, the business of A Holdings Pty Ltd was undertaken by two employees under the supervision of the Wife.  The Wife continued to receive income from the business although she was not working in the business.  She recommenced working for the business in about 1999 at which time she worked for about four days a week. 

31. A Holdings Pty Ltd established a childcare centre for the benefit of staff and employed a qualified child carer to run the child care centre.  When the Wife resumed working the child M was cared for through this childcare centre.  The Wife cared for the child on Friday’s frequently assisted by her mother.

32. In about March 2000 Investments Pty Ltd obtained from Solomon Smith Barney a margin-lending facility for $1 million.  This loan was secured on the home at K.  At first the Husband denied that the K property was security for the facility but in cross-examination when shown certain documents he admitted that the home was used as security.

33. In August 2000 the family commenced to reside in the K property. 

34. Between September 2000 and June 2001 the Wife’s mother and stepfather arranged for and undertook some repairs and improvements to the C unit.  They paid for the unit to be painted, for the installation of new blinds, for the installation of a new toilet and resurfacing the bathtub.

35. In October 2000 the Husband opened a joint account with his mother at the Nationwide Bank in the United Kingdom.

36. In about June 2001 the Wife leased the C unit for $1,955.36 per month.  The rent was paid direct by the managing agent to a bank account of the Wife’s mother with the National Australia Bank.  The Wife’s mother paid the strata levies, insurance, council and water rates and the remainder of the rent was contributed towards the interest payments due by the Wife to her mother and her stepfather pursuant to the mortgage agreement.  The Wife exhibited to her affidavit a copy of income and expenditure statements of the managing agent.  She also exhibited a copy of bank statements relating to the account in her mother’s name with the National Australia Bank for the period 6 July 2002 until 3 January 2003 into which the rent was paid.  The Wife produced to the Husband in the course of the proceedings copies of the bank statements for the account for the remainder of the period until 4 July 2008. 

37. In summary, in about June 2001 the Wife commenced to pay some interest to her mother and stepfather with respect to the loan she had obtained from them.  The Wife included in her income tax returns the rent that she received from the C unit and the interest that she paid to her mother.  Between 2002 and 2007 the Wife paid interest to her mother of a total of $25,481.  In this period the remainder of the rent was given to the Wife by her mother and was declared by the Wife in her income tax returns as income.  The interest that the Wife paid to her mother was less than the interest that was due pursuant to the terms of the mortgage agreement.  The Wife calculated the amount of interest that was owed by her from March 1993 to September 2008 was a total of $370,588, after allowance for the payment of interest of $25,481.

1. In June 2001 the child B was born.  The Wife ceased working for U Business shortly prior to the birth of the child B.  She recommenced working part time for three days a week in about August 2001.  Thereafter the Wife relied on the child carer employed by A Holdings Pty Ltd to care for the children while she was working.  The Wife increased the hours and number of days that she worked up to four days a week.  The Wife’s mother cared for the children one day a week and the Wife cared for the children each Friday.

2. In 2002 the Husband commenced employment with N Company.

3. On 14 February 2003 the Wife executed a will in which she made provision for her mother to be paid from the Wife’s estate all monies due with respect of the mortgage obtained to purchase the C unit.

4. In late 2003 the Wife entered into consultancy agreement and joint venture arrangement with a firm called D Firm.  The Wife paid $30,000 to enter the arrangement with D Firm and she borrowed the money from her stepfather.  A Holdings Pty Ltd is repaying the loan from the Wife’s stepfather and as at 30 June 2007 the Company owed $20,400. 

5. In 2004 the Husband commenced employment with … and later with H Company.

6. In August 2004 the Wife terminated the arrangement with the firm D Firm and relocated her business U Business to premises to be in close proximity to the children’s schools.

7. For the remainder of the marriage the Wife continued working for U Business, usually four days per week.  However in 2005 the Wife was unable to work as much as she had been because of difficulties in the marriage and also her health.

8. In September 2004 the Husband applied for and was granted by the Commonwealth Bank of Australia a Viridian line of credit that could be drawn down up to $60,000.  It was secured on the title of the K property.  The Wife contended that the Husband without her knowledge and consent obtained the facility.  The Husband contended that during the period from 11 December 2004 to 18 July 2007 he used the Viridian line of credit to pay for miscellaneous expenses such as electricity, school fees and general living expenses.  In January 2006 the amount due in respect of the facility was $12.01.  The Husband unilaterally after separation in March 2006 increased the amount of the facility to $60,000.

9. Between 17 February 2005 and 15 November 2005 the Wife’s shares were sold for a total of $64,946.38.  She used some of the proceeds of sale to pay for removalist expenses and to purchase furniture and effects including a new bed, television, coffee table, gardening tools, linen, a kitchen table and an outdoor table. 

10. In May 2005 Capital Ltd was incorporated.  The Wife contended that the Husband worked on a prospectus to float the Company. 

11. On 20 December 2005 the Wife entered into a lease of premises at P paying rent of $790 per week.  The Wife’s stepfather agreed to pay the rent and rental bond, and up until the end of December 2006 he paid a total of $46,845.  In November 2006 the Wife had a conversation with her stepfather about her ability to continue to pay the rent.  The Wife’s stepfather has continued to pay the rent and between 1 December 2006 and 17 September 2008 and he paid a total of $114,886. 

12. When the Wife and the children ceased to live in the former matrimonial home at K, Ms F was employed by A Holdings Pty Ltd to provided childcare services.  Ms F was in receipt of a gross annual salary of about $45,676.  Payroll tax, superannuation and workers compensation was paid on the salary and benefits.  The Husband made no contribution towards the costs of employing Ms F.  However the Husband relied upon assistance from the services provided by Ms F because the children remained in childcare until 6:30 pm on Mondays, Tuesdays and Wednesdays and until 7:00 pm on Thursdays when the Husband finished work.

13. In January 2006 the parties separated.  The Wife and the children vacated the K home.  The Husband continued to occupy the K home until it was sold in July 2007.  Since January 2006 the Wife has resided in rented accommodation.

14. Since the separation in January 2006 the Wife has had the primary care of children.

15. Since separation, to meet the cost of the support for herself and the children including rent, the Wife has used the proceeds of sale of her shares and also borrowed monies.

16. At the time of separation the credit card debt of the Wife was $32,399.59.  Her current credit card debt is $23,453.48.  The Wife contended that the Husband refused to allow the credit cards to be repaid to avoid interest accruing subsequent to separation.  The Wife’s present credit card debt has been reduced by payments from her post separation earnings.  There was no issue as to the credit card debts of the Wife originating from the time of the marriage and being for the benefit of the family.  It was submitted by the Wife that they should be included in the net assets.  However, the Wife contended that I should also make a finding of waste occasioned by the Husband refusing to allow the credit card debts of the Wife accumulated during the marriage to be discharged from the proceeds of sale of the K home, thereby creating significant interest penalties to accumulate.  The Husband did not accept that I should include in the list of assets the amount of $23,453.48. 

17. The Husband’s income post separation has been substantially superior to that of the Wife.  The Wife provided a schedule setting out the taxable income of the Husband post separation.

18. Following separation until the commencement of the second school term in 2008 the Husband paid the school fees relating to each of the children.

19. After the parties separated the Wife made an application to the Child Support Agency for child support.  The Wife contended that the total of child support paid by the Husband since the parties separated was $17,530 for 2006, $13,669.73 for 2007 and $5,320.39 for 2008.  I was given a schedule setting out the child support payments which the Wife received from the Husband.

20. Between January 2006 and August 2006, the Husband drew down on the Viridian line of credit to create a debit balance of $51,420.  The Viridian facility was discharged on the sale of the K home on 18 July 2007 in the sum of $59,492.37.  The Husband gave no adequate evidence explaining why after separation he needed to make drawings on the line of credit to pay expenses.  The withdrawals made by the Husband after separation on the Viridian facility were applied to pay child support and school fees by way of direct debit to the Husband’s personal account and to pay the Husband’s personal credit card expenses.  During the period of these withdrawals, the Husband had the benefit of the occupation of the K property to the exclusion of the Wife and the children, and was in receipt of an income from H Company of in excess of $237,000 per annum.  The Wife contended that the Husband had the capacity to pay child support, school fees and his own personal expenses from his income without access to the Viridian facility.  During the latter part of 2006, the Husband continued to draw on the Viridian facility for his own benefit, including paying fees to his solicitors.  He continued to use the facility to pay for school fees and his credit card expenses.

21. The Wife submitted that the Husband’s post separation conduct in drawing down the Viridian line of credit and applying it in the circumstances outlined above, against a background where he was in receipt of a substantial income from H Company and could pay such child support and maintenance obligations from his income, was a contribution to be weighed in the Wife’s favour.  It was submitted that there was an absence of evidence in the Husband’s case as to his application of his income post separation, when many if not all of his expenses were being funded by the Viridian facility.

22. Between 1 March 2006 and 27 June 2006 the Husband paid to the Wife child support of a total of $7,389.75.

23. By letter dated 17 March 2006 the Child Support Agency wrote to the Wife and advised that the Agency had received advice about some payments the Husband had made to the Wife for child support and thereafter there was set out in the letter details of payments said to have been made between 20 January 2006 and 13 March 2006.  The amounts included payments for haircuts, groceries, soccer fees, stationery, a soccer kit and a birthday party.  By letter also dated 17 March 2006 the Child Support Agency wrote to the Wife and advised that it had received information about payments the Husband had made for school fees being payment of $6,826 on 2 March 2006.  By letter dated 21 March 2006 the Child Support Agency wrote to the Wife and advised that it had received information about payments made by the Husband and thereafter there was set out in the letter particulars of payments made between 20 January 2006 and 20 February 2006.

24. In the year ended 30 June 2006 the Wife had a taxable income of $32,549.  In that same financial year A Holdings Pty Ltd had a profit before income tax of $1,143.56.  The Wife drew down $8,382.74 by way of a loan from the Company.  In the year ended 30 June 2006 the Husband had a total income of $236,153.

25. The Husband contended that between July 2006 and July 2007 he made use of the Viridian line of credit primarily to pay for improvements to the K property to prepare it for sale as well as for other personal expenses such as school fees and legal fees.  In his affidavit of 18 September 2008 he contended that using the Viridian line of credit he paid for specific repairs and costs with respect to the K property of a total of $56,520.  The interest and account fees amounted to $517.  As at 12 July 2007 the line of credit had a debit of $59,276.62.  The Wife conceded that the Husband applied approximately $55,000 for the improvements to the home. 

26. In August 2006 the Husband’s mother passed away in the United Kingdom. 

27. In his affidavit of 29 October 2008 the Husband contended that he sold the following shares in the United Kingdom listed companies:

    $

    ·20/09/06  17,882

    ·21/01/07  27,494

    ·08/06/07  14,120

    ·07/10/08  35,735

    Total  $95,231

28. On 10 November 2006 proceedings were commenced when an application for final orders was filed on behalf of the Husband seeking property and parenting orders.  On 10 November 2006 the Husband also filed an application in a case seeking interim parenting orders.

29. In a financial statement filed on 10 November 2006 the Husband stated his occupation at CF Company.  He contended that he had an average weekly income of $4,809 being $250,068 per annum and total personal expenditure of $4,843

30. On 19 December 2006 the Wife filed a response to an application for final orders.

31. In a financial statement filed on 19 December 2006 the Wife testified that her occupation was Consultant.  The Wife contended that she had an average weekly income of $1,230 or $63,960 per annum and total personal expenditure of $1,607.

32. On 22 December 2006 the following orders were made by consent:

    1.The parties have equal shared parental responsibility for the major long-term issues relating to the children [M] born […] April 1999 and [B] born […] June 2001 (“the children”), it being NOTED that before and after school care arrangements for the children are not matters that fall within the concept of ‘major long-term issues’.

    2.That the children live with the Wife.

    3.That the children live with the Husband at the following times:-

    3.1    From 6 pm Wednesday 13 December 2006 until 8 am the following morning;

    3.2    From 6 pm Wednesday 20 December 2006 until 8 am the following morning;

    3.3    From 3 pm on Friday 22 December until 2 pm on Christmas Day;

    3.4    From 9 am on 1 January 2007 until 9 am on 22 January 2007;

    3.5    From the commencement of the January 2007 school term on alternate weekends from after school on Fridays until before school on Mondays, commencing the first full weekend after school commences;

    3.6    Each Wednesday from 6 pm until before school on Thursday;

    3.7    For half of school holidays commencing with the First Term holidays in 2007 as agreed and otherwise for the first half of the holidays in 2007 and each alternate year thereafter and for the second week in 2008 and each alternate year thereafter.

    4.For the purposes of order 3 handover of the children will take place during school holidays at venues as agreed, and during school term shall be at venues as agreed and failing agreement in school terms as [S School].

    5.School holidays are defined as commencing from after school on the last day of school term until the first day of school (not being a pupil free day).  Handover during the school holidays will be at 5 pm on the middle day of the holidays, where applicable in these orders, and the parties will have an equal number of nights.

    6.In the event the children are not otherwise in the care of the Wife on Mother’s Day the children will spend time with the Wife on Mother’s Day from 9 am until before school the following morning.

    7.In the event the children are not otherwise in the care of the Husband on Father’s Day the children will spend time with the Husband on Father’s Day from 9 am until before school the following morning.

    8.The parent who does not otherwise have in the care of the children on their birthdays will spend time with the child from after school until 6 pm if it is a school day and from 1 pm to 5 pm if it is a weekend.

    9.In the event that one of the parties is not able to care for the children for 1 or more consecutive nights during the time the children live with him or her that party will offer the other party the care of thee children during that period before making other arrangements for their care.

    10.That there be no Order as to costs of and incidental to the interim application filed by the Husband and returnable on 21 December 2006.

    11.That pursuant to s.65DA(2) and s.62B, the particulars of the obligations these Orders create and the particulars of the consequences that may follow if a person contravenes these Orders and details of who can assist parties to adjust and comply with an order are set out in the attached Family Law Court’s Fact Sheet entitled “Parenting Orders – obligations, consequences and who can help” and those particulars are incorporated in these Orders.

33. In February 2007 the Husband sought a Child Support Agency review because he paid school fees and also the Wife was earning more than she disclosed.  There was a change and the amount the Husband was required to pay was reduced.  The Wife’s child support income was set at $62,000 per annum.  The Husband objected to this assessment and in April 2007 the Wife’s child support income was assessed at $68,000 per annum.

34. On 3 May 2007 the parties were divorced.

35. On 14 May 2007 the matter came before me and I made the following orders:

    1.The hearing of the parenting proceedings be adjourned.

    2.Pursuant to s 62G Family Law Act 1975 (Cth), [Ms E], Family Consultant, prepare a Family Report in relation to the care, welfare and development of the children [M] born […] April 1999 and [B] born […] June 2001.

    3.The parties attend all appointments fixed by the Family Consultant and ensure that the subject children attend all such appointments with the Family Consultant as may be required.  [CDC at 11.15 am on 2 November 2007.]

    4.The Family Consultant has leave to inspect the Court file and all documents produced on subpoena once permission to inspect has been granted to at least one party in this matter.

    5.Arrangements be made for a further hearing date of the parenting applications by arrangement with my Associate.

    6.The Lawyers are to lodge with my Associate within 21 days a Joint Balance Sheet in which they set out the parties respective contentions as to their assets and liabilities including the matters about which there is no agreement both as to identity and value.

    7.Each of the parties are to provide to the other within 28 days of today all primary records in his/her possession or control which support the respective contentions in respect of the matters of controversy identified in the balance sheet and further, which support his/her contentions in relation to the assets and liabilities that each party contended they had at the commencement of the relationship.

    8.Each party is to provide to the other a copy of all income tax returns including corporate financial statements within 28 days of the date of this order.

    9.Upon completion of the preceding directions the matter be re-listed by arrangement with my Associate.

    10.I NOTE that it is agreed that the parties will retain a single expert for the purposes of obtaining valuation evidence of any item in respect of which there is a controversy as to current value.

36. On 25 June 2007 the Wife filed an amended application for final orders.

37. In the year ended 30 June 2007 the Wife had a taxable income of $27,782.  In that same financial year A Holdings Pty Ltd had a profit before income tax of $79,817.28 and a net profit after tax of $58,102.98.  According to the tax return of the Company it had a taxable income of $72,381 and the tax payable was $17,111.30.  In that year the Wife drew down $90,564.23 by way of a loan.  The profitability of the Company had significantly increased from the previous financial year.

38. In the year ended 30 June 2007 the Husband paid to the Wife child support of a total of $18,129.56 or $174 per week per child.

39. In the year ended 30 June 2007 the Husband had a taxable income of $262,536.  Even allowing for the taxable income of the Wife of $27,782 and her loan account drawings of $90,564, being a total of $118,346, the Husband had a significantly greater income than the Wife.

40. The home at K was sold in July 2007 for a price of $1.49 million.  On completion of the sale the mortgage debt secured on the title of the property was repaid and discharged.  On completion of the sale an amount of $59,492.37 was paid from the proceeds of sale in reduction of the Viridian line of credit.  The net proceeds of sale were then deposited to the credit of a controlled monies account.  As at 14 August 2008 the account had a credit balance of $949,148.49. 

41. On completion of the sale of the K property the Husband obtained a lease of a four bedroom and four bathroom home at Y.  The monthly rental is $4,355.  On 21 January 2008 he paid a rental bond of $8,370.80.

42. On 18 July 2007 the Husband unilaterally reduced the amount of child support that he was paying by 30 per cent of the assessment as it then was.  He reduced the periodic payments to $946.75 per month.  The Husband told the Wife that he had done so because he paid the children’s school fees directly to W School and S School.  The Wife contended the fact that the Husband was paying the school fees had already been taken into account by the Child Support Agency and a re-assessment that the Husband had sought.  The Wife submitted that such conduct was at least disingenuous in circumstances where payment of school fees had already been taken into account by the Child Support Agency on review. 

43. In August 2007 the Husband was retrenched from his employment at H Company.  The Husband remained unemployed until 23 April 2008 when he commenced employment with SH Company.  He was unemployed for a period of approximately 34 weeks.

44. On 31 August 2007 the Husband received a retrenchment package of $93,923.91 which was taxed at $23,959 leaving a net payment of $69,964.91.  The Husband contended that his account with the Commonwealth Bank then had a balance of $78,294.49.  The Husband retained the benefit of these monies.  The Husband had a bank account number … with the Commonwealth Bank and he annexed to his first affidavit copies of some bank statements relating to transactions on this account.  As at 15 August 2007 the account had a debit balance of $19,258.  The Husband then received $38,647 by way of salary and bonus on 15 August 2007.  He received a further amount of $4,785 from his employer on 29 August 2007.  Thus in August 2007 the Husband received $43,432 from his then employer.  He gave no evidence explaining why his bank account had a debit balance as at 15 August 2007.

1. The Family Consultant said that the child M said he was “really sad” when his parents separated and the hardest thing for him was moving from the family home and having to move between houses.  The Family Consultant said that the child M did ask when “this”, the conflict and court proceedings, would be resolved.  The child M said the resolution of parental conflict is the main thing he would like.  I have already described what the Family Consultant said was her observations of the child B.  The Family Consultant said that the children are still clearly experiencing sadness and loss associated with the separation.

2. The Family Consultant said that the parents are uncertain to what degree the children perceive, and are affected by, parental conflict.  The Family Consultant said that while the Husband thinks the effect is minimised by most of the conflict not taking place in front of the children, the children are, at least now, due to the need for them to be involved in the parenting issues, clearly aware of, and negatively affected, by it.

3. The Family Consultant said that although the parents agree that the children like, and are well integrated into, their schools, due to the financial dispute the parents have not forged a joint commitment to maintain the children at their schools.  The children’s awareness of this has led to worry and confusion for the children.  The Husband suggested to the Wife that, unless there is an equal sharing of the fees, the children may not be able to continue at their current schools.  The children were made aware of this when they heard the Wife discussing this with her lawyer.

4. The Family Consultant said that the parental conflict led the children to be worried and anxious about what they would say in the meetings with the Family Consultant and this inhibited their abilities to act and speak spontaneously.  The Family Consultant said that if children experience intense and/or enduring parental conflict, their feelings of anxiety can become entrenched and can damage child/parent communication and cause children significant emotional distress and/or inhibition.

5. The Family Consultant said that the children have experienced considerable change and have had to accommodate new households and new people in their lives.  Their schools have been a source of security and continuity to them and changes would cause significant disturbances for them.  The Family Consultant said that it is unfortunate that this matter has arisen and that they have been made aware of it given that a change may not occur, or may not occur for some time.

6. The Family Consultant said that children of the ages of the children are usually able to describe and articulate their parenting arrangements.  The children may benefit from utilising calendars and being encouraged to gradually be more self sufficient, but impressively, unlike many children whose parents are in conflict, the children appear to be confident that their parents will sort out and coordinate their activities and arrangements.

7. The Family Consultant said that if the parents soon resolve the outstanding parenting and financial issues, and protect the children from further involvement in these matters, they are likely to raise two very competent children who will recover and adjust well to the losses and changes which are consequences of the parental separation.  They are also both likely to maintain good quality parent/child relationships.

8. There are a number of relevant matters.  I take into account the views of the child M about spending an extra night with the Husband.  I take into account the concerns about the practicalities of an extra night with the Husband during a school week and the possibility of further issues about important practical matters such as homework and so on, that obviously cause anxiety in the children.  I am also of the view that the Wife has been the primary carer of the children and that this role will continue into the future.  I am concerned also about the child B and her ability at this time to deal with further separation from the Wife.  I do not accept the contention in the submissions of the Husband that school holiday periods can be equated with a school week.  Finally and importantly I take into account the continued conflict between the parents and the effect of this on the children. 

9. I have come to the conclusion that in all the circumstances of this case, it would be in the best interests of each child that the current regime should continue.  Obviously when this litigation is concluded and the children are secure in the belief that they will not experience further significant disruptions such as a change of schools and the conflict between the parents abates, then the situation may be reviewed.  For example there has to be an end to the constant issues about child support.  However, at this time I am not prepared to take any risks with the security and well being of these two children who, in some respects, have been described by the Family Consultant in worrying ways.  If the parents are unable to directly deal with the conflict that exists between them and which is clearly effecting the children then each of the parents should seek professional assistance.

FINANCIAL CIRCUMSTANCES

1. The first step is to determine the extent and value of the property, liabilities and financial resources of the parties at the time of the hearing.

Issues

1. The parties are in issue as to the current value of the C unit.  Mr O provided a valuation report of the C unit dated 26 June 2007.  He valued the property at $625,000.  It is a fourth floor two bedroom strata title home unit with a storage cage.  It is located in a five storey residential flat building on a waterfront reserve allotment.  The unit has a building area of 103 square metres including a balcony.  In his first report Mr O said that the C Strata home unit market has performed steadily since late 2003 and he identified “RP Data” statistics that disclosed “median” C home unit prices for the five years 2003 to 2007 inclusive.  Mr O said that such statistics reflected the “basket” of property sold in any particular statistical period.  He also said that in determining his valuation he had regard to some nine sales, one of which was a unit in the same street which sold in July 2006 for $625,000.  This property was described as a smaller two bedroom home unit with “good views” and comprised 84 square metres.

2. Mr O prepared a further report which was attached to an affidavit he swore on 30 October 2008.  In the second report Mr O valued the C unit at $700,000.  Thus between June 2007 and October 2008 the value increased by $75,000 or 12 per cent.   Mr O again referred to real property data statistics for median C area home unit prices for the past five years and he recorded that in 2007 there was an increase of one per cent and in 2008 an increase of 5.7 per cent to August 2008.  In his first report he had shown for 2007 an increase of 8.5 per cent and in his second report he described an increase for 2007 of one per cent. 

3. In his second report Mr O referred to a sale of a unit in the same street in August 2007 for $650,000 and a sale of another unit in the same street in November 2007 for $782,500.  This sale in November 2007 was of a three bedroom unit of an area of 99 square metres in a residential building abutting the waterfront reserve.

4. By letter dated 22 October 2008 the solicitors for the Wife asked Mr O various questions and he provided a response by letter dated 24 October 2008.  Mr O said that the sale of the property in November 2007 was utilised as a relevant sale because although it was markedly superior to the subject property it was useful as an indication of the ceiling price for an older style type strata home units in the locality.  As well in his letter Mr O identified sales in February, June and July of 2007 and said that they were not considered comparable or relevant.  He also said that the real property data statistics that he referred to in his reports were not taken into account when determining the valuation.  Pausing there given that Mr O referred to the real property data statistics in both of his reports I assumed that the statistics must have had some relevance otherwise they should not have been referred to.  He did admit that the two official interest rate increases in late 2003 had an almost immediate adverse effect on the general Sydney residential real estate market and subsequent increases impacting further, however, he had no evidence of reductions in market values for C area Strata title properties.  He contended that demand for well located strata title properties at C remain steady in the price bracket.

5. In cross-examination Mr O agreed that very recent real property data statistics for median C area home unit prices reveal a reduction in values.  He also agreed that Australian Property Monitor statistics reveal a seven per cent decrease in values of median price units in C.

6. In cross-examination Mr O was asked about a sale in 2008 of a unit in the same street for $421,000 which comprised 60 square metres and he described it as “very very cheap”.  He was asked about a sale in May 2008 of another unit in the same street for $680,000 which he conceded “looks” superior having full harbour views.  He was asked about a sale in May 2008 in the same street for $595,000 which he said was in an inferior location.

7. Mr O then made clear that without further investigation he would not “quibble” with a value of $660,000.  He made clear that a value of $660,000 was reasonable.  He also said that in any event there could be a five per cent variation which of $700,000 is $35,000. 

8. I did not allow counsel for the Husband to examine Mr O as to what he meant by the response “without investigation”.  Mr O had the opportunity to make further investigations given he was asked to update his report and as well he had been asked questions as recently as October 2008.  It was very clear to me that he conceded that a value of $660,000 was reasonable and that is the value that I propose to adopt.

9. This is an interesting case in relation to the evidence of the single expert.  It demonstrates that even in the most obvious of cases where a single expert gives evidence a party may successfully challenge the evidence of the expert.  It was done in a convincing way and in my view, notwithstanding the submissions of the Husband, the outcome was conceded by the single expert.

10. Since January 2006 the Husband has had the benefit of significant amounts of money from various sources such as his salary, retrenchment payment, proceeds of sale of shares, an inheritance and approximately $20,000 from his superannuation interests.  The Husband has spent the majority of what he received.  In the current assets the Husband has $35,995 in bank accounts and has paid $122,878 on legal costs.  In the period between September 2007 and April 2008 he spent $5,353 on holidays and travel, $8,470 on household furnishings and removalists, $6,450 on life insurance and considerable sums on rent.  He also paid child support and education expenses.  However, although I accept that there may be some justification for suspicion about what the Husband has done with the significant funds he had available, the evidence does not enable me to conclude on the balance of probabilities that the expenditure incurred by the Husband was unreasonable or extravagant.  I am not going to include the Husband’s retrenchment payment of $69,964.  He has spent the entirety of the funds.  I am also not going to include the amount the Husband drew down on the Commonwealth Bank Viridian line of credit of $53,997 as it was repaid. 

11. So also when I consider the evidence of the Wife in relation to the proceeds of sale of her shares, the income and other money she received from A Holdings Pty Ltd and the money borrowed from her stepfather, the evidence does not enable me to conclude on the balance of probabilities that the expenditure she incurred was unreasonable or extravagant.  The Wife has lived in rented accomodation since January 2006 and she has paid legal costs of $127,955.  I accept that she has reasonably expended the funds she had the benefit of.  The Wife also had a significant credit debt at the date of separation.  I am therefore going to include the Wife’s American Express and Visa card debts of $23,453 and her debt to RW for $114,886.

12. I am not going to include the Investments Pty Ltd deficiency.

Conclusion

1. In my opinion, for the purposes of these proceedings, the parties have the following assets and liabilities:

   $

   1.      C unit property (w)  660,000

   2.      Net sale proceeds K property (h)  977,340

   3.      Investments Pty Ltd (h)  -

   4.      S Brokers Ltd (h)  -

   5.      Contents of K property (h)  35,912

   6.      Husband’s jewellery (h)  442

   7.      Contents in C Unit (w)  16,085

   8.      Wife’s jewellery (w)  11,405

   9.      Husband’s life policy (h)  13,359

   10.    Husband’s interest in AG Trust and Deceased estate (h)                 22,000

   11.    Husband’s Commonwealth Bank accounts (h)  35,995

   12.    Wife’s National Bank account (w)  136

   13.    Husband’s 65 Commonwealth Bank shares (h)  2,600

   14.    Wife’s 24 IAG shares (w)  125

   15.    Husband’s 2,500 ING Options (h)  -

   16.    Husband’s Golf Motor car (h)  12,000

   17.    A Holdings Pty Ltd (w)  1,071

   18.    Dividend payable by A Holdings Pty Ltd (w)  163,500

   19.    Wife’s legal fees paid (w)  127,955

   20.    Husband’s legal fees paid (h)  122,878

   21.    Wife’s First State Super (w)  32,072

   22.    Husband’s Self Managed Super (h)  203,272

   Total   2,438,147

   Less

   23.    Mortgage on C Unit (w)  256,000

   24.    Wife’s Amex & Visa card debts (w)  23,453

   25.    Wife’s debt to RW for rent (w)  122,071

   26.    Wife’s debt to A Holdings (w)  207,269

   Total  (608,793)

   Balance  $1,829,354

Financial resources

1. The Wife contended that the Husband had as a financial resource benefits from Capital Pty Ltd and/or Research Pty Ltd.  However, as I have said, given the total absence of any evidence from the Husband, I assumed that he will never receive any financial benefits in the future from Capital Pty Ltd and/or Research Pty Ltd.  The Husband had an obligation of disclosure and consistent with this obligation he had to provide evidence that would enable an assessment as to whether Capital Pty Ltd and/or Research Pty Ltd were a financial resource.  The Husband contended that he had made a complete disclosure and the evidence does not enable me to safely conclude to the contrary. 

CONTRIBUTION

Relevant contributions

1. The parties commenced cohabitation in March 1998 and separated in January 2006.  The period of cohabitation was approximately eight years.  There are two children of the marriage aged nine years and seven years.  The parties have been separated for almost three years.

2. The equity which the Husband had in the property at K at the commencement of cohabitation was $188,314.  The equity which the Wife had in her C unit was $119,000.  However the Wife did not make any significant repayments of interest or principle in respect of the loan she obtained from her mother and her stepfather. 

3. The Husband had an interest in Investments Pty Ltd.  During the relationship he did not obtain any financial benefit from the investment in Investments Pty Ltd and it currently has no value.

4. The Husband had shares in Australian publicly listed companies of a total value of $48,352.  During the relationship the Husband sold the shares for $27,071 and that is the amount that I will take into account.  The Husband also received a total of $88,674.74 from the sale of shares in United Kingdom publicly listed companies.  The total that the Husband received from the sale of shares was $115,745.

5. The Wife also had shares in Australian publicly listed companies at the commencement of cohabitation which she sold during the relationship and at about the time of separation and received a total of $80,353.33.  At the commencement of the relationship this portfolio had a value of $33,110.95.  

6. The Husband also had superannuation interests of a total value of $41,528.  The Wife also had a superannuation interest of $8,000.  The Husband had two life insurance policies of a value of $17,652.

7. The Husband had about $4,057 in bank accounts and the Wife had about $10,497.

8. The Husband had a motor vehicle and a boat and a boat trailer.  The Wife also had other assets that comprised the U Business of a value of $15,063 and furniture and jewellery.

9. In the result I accept that the Husband had greater assets than the Wife at the commencement of cohabitation.  For example, excluding the equity in the K property and the equity in the C unit the assets of the Husband described above total approximately $179,000 and the assets of the Wife total approximately $114,000. 

10. In her affidavit of evidence in chief the Wife provided particulars of the Husband’s gross income as disclosed in his income tax returns for the years ended 30 June 1999 to 30 June 2007 inclusive.  For example in the year ended 30 June 2006 the Husband had a gross income of $237,264 and in the year ended 30 June 2007 had a gross income of $261,621.  The Husband was retrenched from his employment with H Company in about September 2007 and commenced employment with SH Company in about April 2008.  The Husband’s gross income for all sources, including the termination payments for the year ended 30 June 2008 was $213,000.

11. In her affidavit of evidence in chief the Wife also provided particulars of her gross income for the financial years ended 30 June 1999 to 30 June 2007 inclusive.  She also provided particulars of the taxable income, if any, in each of these financial years of A Holdings Pty Ltd.  The Wife also provided evidence of the additional income she received by way of rent from the C unit for each of the financial years ended 30 June 1999 to 30 June 2007 inclusive. 

12. I am satisfied that during the relationship and since the separation of the parties, the Husband’s income from paid employment was significantly greater than that of the Wife including the rental and dividend income that the Wife received.  However, I also take into account that the Wife made no payments of principle in respect of the mortgage loan she obtained from her mother and stepfather to purchase the C unit and paid only a small amount of interest which I have referred to above. 

13. After the parties were married the Wife undertook the majority of home making including shopping, cooking meals and housecleaning.  The Wife did receive some assistance from a cleaner who came to the home once a week and which the Wife paid for.  As well after the children were born the Wife undertook the majority of the care of the children.  The Husband worked long hours leaving home at 7:15 am and frequently returning home at night after the children had been fed and bathed.  As well the Husband frequently travelled interstate and on occasions overseas.  The Wife gave evidence about some of the responsibilities she had for the care of the children such as taking them to consult with health professionals and to social, sporting and extracurricular activities.  The Wife has also been the parent who dealt with matters that arose in respect of the children’s schools and after school care.  This responsibility of the Wife has continued since separation.  For example on Friday of each week the Wife collects the child B from school and takes her to an appointment with a speech therapist and after the session returns the child to school.  In summary I am satisfied that during the relationship and since the separation of the parties the Wife has had a greater responsibility for the care and support of the children.  In my view the Wife was the primary carer of the children and the Husband was the primary income earner.

14. Since separation the Husband has had the care of the children for significant periods and has also paid child support and education expenses.

15. Since separation the Husband has also received a total of $186,333 from the sale of shares, the estate of his late mother and the Nationwide Bank account.  The AG Trust is a family trust which involves the Husband’s siblings as beneficiaries.  It is managed by the Husband’s eldest brother, who resides in the United Kingdom.  The Husband contended that he has received no cash distributions from the trust and any dividends that arose were put back into the trust or to help with the living expenses of his mother.  The trust is in the process of being wound up and the Husband estimated that his distribution of assets will be approximately $22,180 at current exchange rates.

1. Upon separation the Wife moved out of the K property and the Husband remained in occupation for about 18 months until its sale in July 2007.  In the period post separation the Wife has lived in rental accommodation.

Conclusion

1. In all the circumstances, I am of satisfied that when regard is had to the greater assets the Husband had at the commencement of cohabitation and the assets he has received since separation, he made a greater contribution than the Wife.  I assess the contribution based entitlements of the parties, expressed as a percentage of their net assets, including superannuation interests, as to 62.50 per cent or $1,143,346.25 to the Husband and 37.50 per cent or $686,007.75 to the Wife.

OTHER FACTORS

1. The Husband is aged 55 years and the Wife is aged 44 years.  Both parties are in good health.

2. The Husband has a greater earning capacity than the Wife.  The Husband has a significantly greater income than the Wife.

3. As a result of my findings as to the contribution based entitlements of the parties the Husband has greater assets than the Wife namely approximately $457,338.50. 

4. The Wife has the care of the children during the school terms for nine nights out of 14 and the Husband for five nights out of 14.  In any event I am satisfied that the Wife will continue to have a greater responsibility for the care of the children.

5. The Husband will however pay a greater amount than the Wife towards the payment of school fees and periodic child support.

6. On behalf of the Husband it was submitted that I would also take into account that the Husband’s entitlement will include a superannuation interest of $203,272.  I am not sure how I am to do that given the agreed present value.  However no submissions were made on behalf of the Wife.

7. The orders that I propose to make will have no effect on the earning capacity of either party.

Conclusion

1. In all the circumstances, matters that favour the Wife are the greater earning capacity of the Husband, the greater income of the Husband, the greater assets of the Husband and the greater responsibility of the Wife for the day to day care of the children.  The important matters that favour the Husband are his age and his greater financial contribution to the support and education of the children.  I am satisfied that there should be an adjustment to the contribution based entitlement of the Wife to reflect consideration of the matters described above.  In the result I am of the view that there should be an adjustment of 10 per cent or $183,000 of the net assets of the parties to the contribution based entitlement of the Wife.

EFFECT OF ORDERS

1. The Husband will receive an entitlement of 52.50 per cent or $960,411 that will comprise the following:

   $

   1.   Share of net sale proceeds K property   511.953

   2.   Investments Pty Ltd   -

   3.   S Brokers   -

   4.   Contents of K property   35,912

   5.   Jewellery  442

   6.   Life policy  13,359

   7.   Interest in AG Trust & Deceased estate   22,000

   8.   Commonwealth Bank accounts   35,995

   9.   Commonwealth Bank shares   2,600

   10. ING Options   -

   11. Golf Motor car   12,000

   12. Legal fees paid   122,878

   13. Self Managed Super   203,272

   Total   $960,411

2. The Wife will receive an entitlement of 47.50 per cent or $868,943 that will comprise the following:

   $

   1.   C unit property   660,000

   2.   Shares of net sale proceeds K property  465,387

   3.   Contents in C Unit   16,085

   4.   Jewellery   11,405

   5.   National Bank account   136

   6.   IAG shares   125

   7.   A Holdings Pty Ltd  1,071

   8.   Dividend payable by A Holdings Pty Ltd   163,500

   9.   Legal fees paid   127,955

   10. First State Super   32,072

   Total   1,477,736

   Less

   11. Mortgage on C Unit   256,000

   12. Amex & Visa card debts   23,453

   13. Debt to RW for rent   122,071

   14. Debt to A Holdings  207,269

   Total  (608,793)

   Balance  $868,943

3. In all the circumstances, having regard to all relevant statutory considerations, I am of the opinion that the outcomes identified above are just and equitable.

4. I have found that there is currently $977,340 held in the controlled moneys account from the proceeds of sale of the K property.  The Husband will receive 52.38 per cent ($511,953) and the Wife will receive 47.62 per cent ($465,387).

CHILD SUPPORT

Relevant principles

1. In an application to a court for child support departure I am required pursuant to s 117 of the Child Support Assessment Act to undergo a three-step approach in determining whether or not it is appropriate to make an order by way of departure from the administrative assessment.

2. I am required to make an initial threshold finding pursuant to s 117(2) as to whether or not special circumstances exist to depart from the administrative assessment. In this case both parties submitted that special circumstances exist for departure from the administrative assessment both on a periodic and non periodic basis.

3. It is clear that each of the parties propose to educate the children at private schools which carry an impost in excess of approximately $30,000 per annum.  Each of the parties seek that I determine the percentage contribution that they should make towards the payment of school fees.

4. An application of the assessment procedure would provide an inequitable contribution to the payment of child support in that it fails to adequately recognise the payment of significant school fees in addition to a requirement for periodic support.  The Husband contended that the administrative process failed to adequately recognise the monies available to the Wife from her personal services company such that her taxable income does not truly reflect the benefits that she receives from her personal service company and/or employment.  The Husband’s income is in excess of the administrative threshold.

5. For those reasons it was submitted that I would make the threshold finding that special circumstances do exist under either s 117 (2) (b) (ii) and/or s 117(2) (c) (ii) and that a ground for departure exists.

6. Having determined that a ground for departure exists I am next required under s 117(1)(b)(ii)(A) to be satisfied that is just and equitable to make an order by reference to the matters in s 117(4).

7. In determining what is just and equitable I am required to take into account the proper needs of the children, the income earning capacity and financial resources of each of the parties and to determine whether hardship would be caused to either the child or the parent in refusing to make an order.

8. Both parties, on differing foundations, submitted that it would cause hardship if I refused to make an order given the implications of an application of the administrative assessment and the history of child support disputes between the parties to date.

9. In determining the proper needs of the child I may have regard to what are said to be the costs of supporting the child as set out in the evidence of each party, what an application by way of assessment of the administrative formula would produce in relation to the costs of the child and also having regard to published research in relation to the costs of supporting children. Sections 117(6) and (7A) provide matters that I must have regard to. However in Ross and McDermott (1998) 23 Fam LR 613 the Full Court said at 623:

   “[39] In our view a practical and flexible approach should be adopted to the task of considering these s 117(4) and (5) matters, that is an approach similar to that which this court has long adopted to the “s 68F(2)” matters (formerly the “s 64 matters”) in child-related proceedings under the Family Law Act 1975 (Cth). Accordingly we consider it is unnecessary to make any reference to those s 117(4) and (5) matters which have no real relevance to the circumstances of the case. We also consider that it would be permissible to group together and consider as a whole, those relevant matters which by their nature lend themselves to such an approach in the circumstances of the particular case, and in the case of those matters which are required to be considered under more than one subsection s 117 to examine such matters only once, although they may need to be taken into account under more than one subsection”.

10. Having determined that it would be just and equitable I then have to determine whether it is otherwise proper having regard to the matters in s 117(5). What is proper is to be considered within the context of the public interest as well as welfare considerations. Here no such considerations arise.

11. The Husband submitted that it would having regard to all of the matters in s 117(1), be appropriate to make an order in the terms he sought. The submission of the Wife was to the same effect producing the orders she sought.

Conclusion

1. In her most recent financial statement the Wife contended that her weekly expenses for the support of the children total $942.  The Husband in his recent financial statement contended that his weekly expenses for the support of the children total $1,180.  However the expenses contended for by the Husband included education expenses of $480 per week.  If the amount of $480 was excluded then the Husband contended that his weekly expenses for the support of the children total $700.  Currently in each 14 day period the children, subject to periods of time at school, spend approximately 35 per cent of the time in the care of the Husband.  It was not disputed that the children are in the care of the Husband under the current regime for approximately 142 nights per annum or 38.98 per cent over a period of 12 months.  I assume therefore that the Husband accepted that the Wife’s contentions as to her expenses for the support of the children were reasonable.  It meant that the parties were contending that the weekly expenses for the support of the children including education expenses total $2,122.  I identified this amount in discussion during final submissions and neither counsel submitted that this was not the appropriate finding on the evidence.

2. The parties agreed that the current education expenses are approximately $30,000 per annum or $576.91 per week.  Thus according to the evidence the total cost of support and education of the children was $2,219 per week ($577 + $700 + $942).  The only issue in this case is how the responsibility for the payment of these expenses is to be borne as between the Husband and the Wife.

3. I am proceeding on the basis that the expenses for the children referred to include all medical, dental and orthodontic expenses relating to the children over and above sums recoverable from a private health fund and/or Medicare.  For example the Wife in her recent financial statement included $30 per week for medical, dental and optical expenses not including health insurance premiums and the Husband included an amount of $5 per week. 

4. As a result of the findings in the property settlement proceedings the Husband has assets of a net value of $960,411 and the Wife has assets of a net value of $868,943.

5. The Husband admitted in cross-examination that excluding superannuation his income from employment including bonuses is approximately $220,000 per annum or $4,230.77 per week.  I have not included any dividend and interest income for the Husband.  In the Husband’s recent financial statement he disclosed dividend and interest income of $83 per week. 

6. In the year ended 30 June 2008 A Holdings Pty Ltd had a net profit after tax of $117,835.09.  In that year the Wife received from the Company a salary income of $25,000, a dividend income of $23,000 and a loan of $122,226.81 being a total of approximately $170,227.  Why the Wife received this total amount in the manner that she did was not explained and thus I assume it was on the advice of her accountant.  I have no doubt that the decision as to how much will be allocated to the Wife by way of salary and dividend income is made at the end of each financial year when the tax returns are being prepared.  On one view it may be appropriate to regard the Wife as having the capacity to derive from the Company a total of $143,000 being the salary income of $25,000 and the net profit after tax of approximately $118,000.  This is $2,750 per week.  However the Wife anticipated that based on current billings the income for the business for the year ended 30 June 2009 may reduce and her best estimate was a total income of approximately $300,000.  The total income for 30 June 2008 was $404,000 and thus the income may reduce in the current financial year by approximately 25 per cent.  The current billings at this point in the current financial year are down by about $30,000.  As well, the Wife works in what is generally described as the property sector and thus a decrease in current earnings is anticipated.  In her recent financial statement the Wife said that she receives a net rental income of $350 per week.  However the continued receipt of this income assumes that the Wife will not sell the unit at C and will not pay any interest to her mother.  In her tax return for the year ended 30 June 2008 the Wife disclosed gross rental of $22,378 or $430.35 per week and total expenses of $15,108 including interest of $4,000.  The net rent was $7,270 or $139.81 per week.  As seen I have not taken into account any dividend or interest income for the Husband.

7. Having regard to the evidence before me as to the current income of each of the parties, I am going to proceed on the basis that the Husband has an income of approximately $220,000 per annum or $4,231 per week and that the Wife has an anticipated income of approximately $107,250 per annum or $2,062 per week.  The amount of $107,250 is 75 per cent of $143,000.  Therefore the total available income is $6,293 per week of which the Husband receives 67.23 per cent and the Wife receives 32.77 per cent. 

8. The living expenses for the support of the children, excluding educational expenses, are a total of $1,642 per week, or $85,384 per annum.  The children are in the care of the Husband for 39 per cent of the year being 142 nights and with the Wife for 61 per cent of the year.  The cost of $85,384 per annum ($1,642 per week) should therefore be borne in the proportions of 67.23 per cent or $57,403.66 by the Husband and 32.77 per cent or $27,980.34 by the Wife. 

9. As the children are in the care of the Husband for 39 per cent of the year of the total living costs of the children of $85,384 the Husband will in any event pay direct while the children are in his care a total of $33,299.76.  His obligation however is to pay $57,403.66.  Giving the Husband a credit for the amount which he will pay while the children are in his care, namely $33,299.76, the result is that he will have to pay $24,103.90 or $463.54 per week to the Wife. 

10. There are then the education expenses of $577 per week and they should be paid in the proportions of 67.23 per cent by the Husband and 32.77 per cent by the Wife.

11. I am going to make orders for the payment of child support and education expenses that reflect the above findings.

12. In the event that there are unforseen medical, dental or optical expenses that are in excess of the amount of $35 per week that I have allowed for, and that have to be met for the care of the children, then they should be borne by each parent in accordance with the approach I have outlined above.

I certify that the preceding two hundred and sixty eight (268) paragraphs are a true copy of the reasons for judgment of the Honourable Justice O’Ryan

Associate: 

Date:  26 November 2008