Benson and Benson

[2007] FamCA 17

FAMILY COURT OF AUSTRALIA

BENSON & BENSON [2007] FamCA 17

FAMILY LAW - PROPERTY - Settlement in relation to marriage

Family Law Act 1975 (Cth) – s 75(2), s 79

Hickey and Hickey (2003) FLC 93-143; 30 Fam LR 355
Coghlan and Coghlan (2005) FLC 93-220; 32 Fam LR 414

APPLICANT: Mrs Benson

RESPONDENT: Mr Benson

FILE NUMBER: SYF 6553 of 2002

DATE DELIVERED: 25 January 2007

PLACE DELIVERED: Sydney

JUDGMENT OF: Johnston JR

HEARING DATE: 27, 28 & 29 September 2006

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr O'Loughlin

SOLICITOR FOR THE APPLICANT: Hancock Alldis & Roscov, Solicitors

COUNSEL FOR THE RESPONDENT: Mr Cairns

SOLICITOR FOR THE RESPONDENT: Taylor & Scott, Solicitors

Orders

1. That the wife shall forthwith do all things and sign all documents necessary to cause the property at W1 to be sold at a price agreed between the husband and herself and failing agreement at a price nominated by the President of the Real Estate Institute of New South Wales.

2. That the above proceeds of sale be paid to discharge the mortgage thereon and to pay agent’s commission and legal costs on the sale.

3. That the husband and the wife shall forthwith do all things and sign all documents necessary to cause the property at W2 to be sold at a price agreed between them and failing agreement at a price nominated by the President of the Real Estate Institute of New South Wales.

4. That the above proceeds of sale be paid as follows:

   (a)       To discharge the mortgage thereon

   (b)       To pay agent’s commission and legal costs on the sale

   (c)To pay any unpaid commission arising from the sale of the property at W1 and any shortfall thereon

   (d)       To pay C Accountants

   (e)       To pay H Solicitors

   (f)       To pay Land Tax

   (g)To pay all unpaid creditors of the company G Consolidated Pty Limited and

   (h)       To pay the balance to unpaid creditors of G Freight Services.

5. That the wife forthwith do all things and sign all documents necessary to sell her time share at R and her interest in the home unit at T, Macedonia and to pay the proceeds to unpaid creditors of G Freight Services.

6. That within 90 days the wife shall:

   (a)Pay all then unpaid creditors of G Freight Services and she shall indemnify the husband in relation thereto;

   (b)       Pay to the husband the sum of $49 822.

7. That the wife’s interest in the property at E is subject to a charge in the amount of $49 822 until this amount is paid by the wife to the husband and the husband is permitted to lodge a caveat thereon in support of this charge.

8. That pending sale of W2 the husband shall be responsible for payment of all rates, outgoings, insurance premiums and mortgage payments thereon.

9. That the wife forthwith do all things and sign all documents necessary to transfer to the husband her shares in the company G Pty Limited and to resign from any office she may have in the company.

10. That the wife forthwith deliver to the husband’s solicitor, the husband’s birth certificate, passport and any other of his personal papers she holds.

11. That in the event that the husband or the wife neglects or fails to sign any document in accordance with the above orders the Registrars of this Court are appointed to sign any such document in the name of such party and to do all things necessary to give validity and operation to the document.

12. That all exhibits are released.

13. That both parties have leave to re-list these proceedings on 7 days notice in relation to the implementation of these orders.

14. That the above orders not commence operation until 27 February 2007.

15. That the husband and wife each have leave to re-list these proceedings at any time prior to 27 February 2007 for further submissions about the form of the orders only.

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYF 6553  of 2002

Mrs Benson

Applicant

And

Mr Benson

Respondent

REASONS FOR JUDGMENT

Applications

1. Ms B, to whom for convenience I shall refer as “the wife” seeks the following orders:

   1.The parties and each of them do all such acts and things and sign all such documents, instruments and authorities as are necessary to cause the property in Folio Identifier … situate at and known as W2 in the State of New South Wales (the property) to be placed on the market for sale at a price nominated by the President of the Real Estate Institute of New South Wales from time to time or his nominee and the proceeds of sale be disbursed in accordance with order 5 hereof.

   2.In the event that the property remains unsold within 3 months of being placed on the market, then the property shall be listed for public auction to take place within 6 weeks thereafter at or above the reserve price reached by agreement between the parties in default of agreement at a reserve price nominated by the President of the Real Estate Institute of New South Wales or his nominee.

   3.That the sale or public auction of the property be conducted by a Real Estate Agent agreed between the parties or in default of agreement a Real Estate Agent be nominated by the President of the Real Estate Institute of New South Wales from time to time or his nominee.

   4.That the solicitor for the Applicant have carriage of the sale of the property provided that he shall submit all documents to the Respondent’s solicitor as are necessary for him to act in a supervisory role.

   5.That from the sale of the property the proceeds of sale be disbursed as follows:

   a.pay any outstanding registered mortgages

   b.to pay the selling commission of the agent or reasonable auction expenses of the agent together with the reasonable auction expenses and promotional charges of the auctioneer who effected the sale;

   c.to reimburse the party / parties who pre-paid reasonable commercial advertising and auction expenses;

   d.to adjust municipal rates and water rates with the purchase in accordance with the relevant provisions of the contract;

   e.to pay the Applicant’s solicitor who performs the principal role in the conveyancing aspect of the sale her proper costs and reasonable expenses including the costs and expenses of any aborted sale process;

   f.to pay the Respondent’s solicitor his reasonable fees in respect of the supervisory function of such solicitor;

   g.to pay the balance to the Applicant.

   6.In the event of dispute as to the sale price and consequent nomination of the sale price or reserve price by the President of the Real Estate Institute of New South Wales then the parties shall pay equally between them any fee charged by the President of the Real Estate Institute of New South Wales or his nominee determining such sale or reserve price.

   7.Pending sale of the property the Respondent shall be responsible for payment of all rates, outgoings, insurance premiums and of mortgage payments on the property.

   8.Pending payment of all sums due to the Applicant pursuant to these orders or the happening of events referred to in 1 to 7 hereof the Respondent be and is hereby restrained from selling, mortgaging, encumbering or otherwise disposing of the property other than for the purpose of compliance with these orders.

   9.The Respondent will give vacant possession of the property upon receiving 21 days notice of being required by the Applicant’s solicitor to do so.

   10.The Respondent will forthwith transfer to the wife all of his right title and entitlement in:

   a.G Consolidated Pty Ltd.

   b.G Freight Services

   and upon such transfer the Applicant will indemnify the Respondent against any claims that may be made against him arising out of the operation of those entities together with any credit card debts in the Applicant’s name.

   11.Upon receipt of all sums due to her the Applicant will transfer to the Respondent her shares in G Pty Ltd.

   12.The Applicant be and is hereby declared to be the sole owner of:

   a.any motor vehicle, bank accounts and superannuation in her possession.;

   b.G Consolidated Pty Ltd.;

   c.G Freight Services;

   d.The R Time Share;

   e.W1 property;

   f.Property E;

   g.The unit at T, Macedonia.

   13.The Respondent be and is hereby declared to be the sole beneficial owner of:

   a.any motor vehicle, bank accounts, insurance policies and superannuation in his possession;

   b.The shares in G Pty Ltd;

   c.The shares in I Ltd in the name of G Pty Ltd;

   d.The proceeds of sale of the Respondent’s health practice received and to be received.

   14.The Respondent will indemnify the wife in respect of the credit card debts in his name with CBA and St George Bank.

   15.The Respondent will forthwith provide to the Applicant’s solicitor a withdrawal of caveat in respect of the property at W1.

   16.In the event that either party neglects or fails to sign any document relevant to the sale of the property then the Registrar of this Court be empowered to execute any such document.

   17.Liberty to apply in respect of implementation / enforcement of these orders on 3 days notice.

2. On the other hand, Mr B, to whom for convenience I shall refer as “the husband” seeks the following orders:

   1.That the applicant wife transfer to the respondent husband her right, title and interest in the property at W2 and do all things necessary to have the caveat lodged on her behalf withdrawn.

   2.That upon order 1 being carried into effect the respondent husband simultaneously do all things necessary to refinance the property in his sole name and release the applicant wife from any mortgage obligation in relation to that property and also indemnify her in relation thereto.

   3.That the applicant wife have the benefit to the exclusion of the respondent husband of any interest she has in the property at E and the property situated in T, Macedonia presently registered wholly or partly in the applicant wife’s name.

   4.That the applicant wife retain the benefit of any superannuation policy entitlement presently held in her name to the exclusion of the respondent husband.

   5.That the respondent husband do all things necessary to transfer to the applicant wife any interest he may have in the Time Share Unit at R.

   6.That the respondent husband do all things necessary to transfer any interest he may have in the I shares to the applicant wife.

   7.That the applicant wife transfer to the respondent husband any shares she has in G Pty Ltd and resign any office she may have in that company.

   8.That the applicant wife return to the respondent husband his birth certificate, passport and any other personal papers of the respondent husband she may hold.

   9.In the event that the Court is satisfied that the applicant wife has a notional asset available to her orders 3 and 5 will be altered to the extent that the applicant wife do all things necessary to transfer to the respondent husband entire ownership unencumbered of the Time Share Unite in R and the unit in T, Macedonia.

   10.That the respondent husband transfer completely his interest in G Freight Services and the applicant wife indemnify the respondent husband against all liabilities of that entity.

Background

1. The husband was born in August 1931 in China and he is therefore 75 years of age.  The wife was born in January 1963 in Macedonia and she is almost 44 years of age.

2. The parties commenced cohabitation in 1988.  They married in July 1990 and separated on 1 April 2002.  A Decree Nisi of Dissolution of Marriage was pronounced in October 2003. 

3. There is one child of the marriage, L born in October 1990 who is therefore 16 years of age.

4. The wife had been married previously to Mr P.  Sadly Mr P died in 1984.  The wife and first husband had two sons, M and D.  These children also lived with the parties in these proceedings during their marriage.  They were 9 years and 5 years respectively when the parties commenced their cohabitation.

5. The husband had also been married previously.

6. At the time the parties commenced cohabiting the husband’s property consisted of his interest in his health practice.

7. At this time the wife owned the property at W1 unencumbered.  This property had been purchased by the wife and her late husband as joint tenants in 1983.  The wife also owned a one-half interest in the property at W2, the other one-half interest being owned by her parents.  The property was subject to a mortgage of approximately $129 000.  It was rented out.  The wife asserts that she also had an equitable interest in the property at E This property had been purchased by the wife’s late husband and his parents as tenants in common in equal shares prior to the marriage of the wife and her late husband.

8. In 1989 the husband moved out of the U Business.  With a partner, Mr T, he commenced the A Business.

9. In May 1989 the wife received $5508 from her late husband’s superannuation fund.  The wife used this money to pay out the debt on her Toyota Corolla motor vehicle.

10. In August 1989 the husband and wife purchased the home unit at C for a total of $52 000 including stamp duty.  Most of the required funds were borrowed.

11. In September 1989 Mr T left the partnership.  The husband continued to operate the business.  He incorporated a company G Pty Limited to operate the practice.  The wife was issued with 1 percent of the shares, the husband holding the other 99 percent. 

12. In January 1990 the wife purchased a time share unit at R for approximately $12 000.

13. The husband owed the Australian Tax Office a significant amount of income tax by 1990.  He had to borrow $130 000 to pay this.  The wife’s property at W1 was used as security for the loan.

14. In late 1992 there was a fire at the husband’s health practice.  The husband said that he thinks this was a hate crime connected with some charitable work he had been involved in.  This affected the cash flow of the business because for a period some patients were lost although the extent to which business income was affected was in issue between the parties.

15. The parties tried to sell their C home but were unable to achieve a sale.  So they decided to rent out their home and move into W2.  Prior to the parties moving in the wife’s parents undertook some renovations and paid for the costs thereof.  The parties were to pay the wife’s parents a modest rental but in fact lived in the property rent free, apart from paying rates and insurance. 

16. In August 2003 the wife’s father-in-law from her first marriage died.  Her mother-in-law continues to reside in the property at E.

17. In early 1993 the parties borrowed $28 000 from friends and invested this in a company M Pty Limited.  The money was lost.  The parties then borrowed $29 000 from the wife’s parents to repay their friends.  They repaid the wife’s parents over a considerable period.

18. Also in 1993 the parties established a business, G Freight Services which the wife operated.  This business involved sending goods, usually clothing, to Macedonia by shipping containers.  The husband had been Head of the M Health Fund from 1991 which had operated during the Balkan crisis.  The parties had been involved in sending containers of health supplies and equipment to assist the Macedonian people.  The parties’ freight business grew out of this involvement.

19. In 1996 the parties formed the company G Consolidated Pty Limited trading as G Travel.  The parties were equal shareholders.  The wife operated this business by employing staff who had the required qualifications and experience as travel consultants.  Initially, the business was operated from offices adjacent to the husband’s health practice.

20. In September 1997 the parties arranged for the husband to purchase the wife’s parents’ one half interest in W1.  The purchase price was $115 000 but only $84 650 was ever paid.  Upon transfer of the interest the husband and wife own this property as joint tenants.

21. In late 1997 the parties sold their C property for approximately $255 000.  But their indebtedness was more than $278 000 and the wife borrowed $40 000 for the shortfall.

22. In August 1998 the wife and all three children went on a holiday to Macedonia.  During the wife’s absence the husband incurred indebtedness of approximately $28 000 which the wife alleges was mostly caused by his gambling losses.

23. In October 2000 the wife purchased a one bedroom home unit in T, Macedonia for the equivalent of $AUS35 400.  This was purchased primarily as a residence for her son D who was living there at the time but also as accommodation for the wife when she travelled to Macedonia for business purposes.

24. In late 2000 the wife moved the offices of G Freight and G Travel to X.  The wife wanted to sell the businesses but the husband refused.

25. Unfortunately an employee of G Consolidated Pty Limited, Ms V embezzled an amount of approximately $285 000 from the company between 1997 and June 2001.  The parties are not hopeful of recovering any of this money.

26. As indicated above, the parties separated in April 2002.

27. In July 2002 the husband sold his business to F company for $165 000.  This amount was payable over five years by annual instalments of $32 000 due on 1 August and conditional upon the husband being employed in the practice for the five year period.

28. In March 2003 the wife left the former matrimonial home.

29. The parties were divorced in November 2003.

30. The wife married Mr K in December 2003.

31. In May 2005 the wife obtained a loan for $412 500 from U Mortgages.  The wife did not consult the husband or inform him that she proposed to apply for this loan.  Most of this money was applied to pay out the mortgage on the W properties and to repay debts.  The balance of approximately $137 000 was paid into the wife’s account and loaned by her to G Freight Services.

32. In September 2006 G Consolidated Pty Limited was declared to be insolvent and placed into voluntary administration.

The Applicable Law

1. The Court must be satisfied that in all the circumstances it is just and equitable to make an order. This is provided by s.79(2) of the Family Law Act 1975.

2. The Full Court of this Court in its decision in the case of Hickey and Hickey (2003) FLC 93-143; 30 Fam LR 355 said as follows:

   “The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of s.79.  That approach involves four inter-related steps.  Firstly, the Court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing.  Secondly, the Court should identify and assess the contributions of the parties within the meaning of ss.79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties.  Thirdly, the Court should identify and assess the relevant matters referred to ss.79(4)(d), (e), (f) and (g), (“the other factors”) including, because of s.79(4)(e), the matters referred to in s.75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two.  Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case:  Lee Steere and Lee Steere (1985) FLC 91-626; Ferraro and Ferraro (1993) FLC 92-335 (and various other well known authorities).”

3. Despite some criticism of this decision by the majority of the Full Court in Coghlan and Coghlan (2005) FLC 93-220; 32 Fam LR 414, see for example paragraphs 36 and 37 at page 79,641 and paragraph 63 at page 79,646, in my view it is not incorrect to take the approach to the hearing of property proceedings as described in Hickey above.

Property available for division

1. The property available for division between the parties consists of the following:-

$
1.        Property at W1	470,000
2.        Former matrimonial home at W2	480,000
3.        Wife’s interest in the E property	166,667
4.        Wife’s home unit in T, Macedonia	15,000
5.        Wife’s time share at R	12,000
6.        G Health	27,756
7.        Wife’s bank accounts	1,192
8.        Wife’s superannuation	13,952
9.        Husband’s 1994 Ford motor vehicle	3,000
10.      Wife’s Ford Fairmont (add back)	2,200
11.      I shares (owned by G Pty Limited)	4,070
12.      Proceeds of sale of business	0
13.      G Consolidated Pty Limited	0
14.      G Freight Services	0
_____________
$1,195,837

1. The liabilities are as follows:-

$
1.        Mortgage over property W1	470,000
2.        Mortgage over property W2	175,000
3.        Wife’s loan from her parents	20,000
4.        Wife’s Australian Tax Office liability	260
5.        C Accountants	21,517
6.        Source Mastercard	12,348
7.        Go Mastercard	6,986
8.        O Valuers	1,124
9.        H, Solicitors	3,321
10.      Commission on sale of property W1	10,000
11.      Shortfall on sale of property W1	10,000
12.      Land tax (2 years)	8,445
13.      V Valuers	1,100
14.      G Consolidated Pty Limited	209,932
15.      G Freight	76,508
_____________
$1,026,541
Surplus	$169,296

Whether the wife has funds overseas

1. It was submitted on behalf of the husband that the wife has not properly accounted for monies sent overseas.  This was on the basis that from the monies which the wife borrowed from U Mortgages Pty Limited in early 2005 she sent various amounts overseas.  These included an amount of $11 800, then $47 600 and then $40 400.  The latter amount was alleged to have been sent to a person in Macedonia by the name of Mr E.

2. That wife was cross examined about this.  The wife said that Mr E was a regular client of G Freight and G Travel and that he was a pastor in Macedonia who had become a friend of the wife.  The wife said that at a time when Mr E was visiting Australia in December 2004 the wife arranged to borrow $40 000 from him and that he deposited the funds into her Commonwealth Bank account.  The wife said that she required these funds to pay various liabilities.

3. It was submitted on behalf of the husband that the Court should be suspicious of this alleged transaction because the wife had misled U Mortgages Pty Limited at the time of making application for the $412 500 loan.  It is true that the wife significantly overstated her income to the mortgagee in her loan application.  She said that she did this because the level of her indebtedness was so high that she was desperate to raise money.

4. Learned counsel for the wife then sought to reopen his client’s case for the purpose of tendering a bank statement of the wife which it was said would lend weight to the wife’s assertions about the loan from Mr E.  This application was opposed on the basis that this matter had been an issue between the parties for a long time and despite requests to do so by the husband, the wife had not produced any documents concerning the alleged loan.  It was said that in these circumstances it would be unfair to permit the wife to reopen the case because the husband would not have an opportunity to test the wife’s proposed further evidence.

5. In the end result, the wife then withdrew her application to reopen her case.

6. Where did this leave matters?  In my view there was nothing inherently improbable about the wife’s explanation for sending the funds to Mr E.  It is obvious that she had serious indebtedness at this time.  Obviously within a short period of the time of this alleged loan the wife made her application to U Mortgages Pty Limited and then sent funds overseas.  Despite the caution with which the Court must approach the wife’s evidence because she clearly misled U Mortgages with her untruthful loan application, in my view to simply disregard her other evidence would probably visit a serious unfairness on her.  The wife was in business and her business involved a lot of movement of money overseas.  As I have said, she was also seriously in debt.

7. The wife was asked in cross examination whether she had any money or property overseas or such being held on her behalf overseas and she replied that she did not.

8. I am not satisfied that this Court is in a position to make a finding against the wife that it is more probable than not that the wife has transmitted funds overseas to be held there by some person or persons on her behalf.

Contrubutions

1. This was the area of greatest issue between the parties.

2. As indicated above, at the time the parties commenced cohabiting, the wife owned the property at W1, a one-half interest in the property at W2 subject to a mortgage and an equitable interest in the property at E.  On the other hand the husband owned his interest in his health practice.

3. I am satisfied that at this time the wife owned considerably more property than the husband.

4. The wife has made direct financial contributions by reason of the income earned from rent and from the business G Freight and G travel, at least during the early years of their operations.  Unfortunately, as time went on these businesses failed.  I have referred to the very serious defalcation which occurred over some years and which deprived the business of approximately $285 000, money which clearly the business could ill afford to lose.  It appears that the business never recovered from these losses.

5. I am satisfied that the wife wanted to close down the business operations and sought the husband’s agreement to such a course.  The husband disagreed.  He wanted the wife to continue to operate the business in the hope that such would provide the parties with income after he retired from his business.  The husband was content to leave the responsibility for operating the business entirely in the wife’s hands, including for the duration of the period following their separation.  As things have turned out, this has been disastrous because, as indicated above, the business has failed and it has been placed into administration.

6. On the other hand, the husband has worked consistently during the marriage as a health practitioner.  He has operated a successful and profitable health practice.  He has been supported by the wife in this.  There have been some problems such as failing to make adequate provision for payment of taxation, the fire at the health practice in 1992 and the husband’s propensity for spending money through his practice of gambling.  But despite these problems, I am satisfied that the income generated from the husband’s health practice has been the major source of income of the parties during their marriage and cohabitation.

7. Both parties have made contributions to the welfare of their family unit, contributed by themselves and their daughter L.  But I am satisfied that the wife’s contributions as homemaker and parent have exceeded those of the husband.

8. How are all these various contributions to be assessed overall?  As I have said, the wife’s initial contributions were much greater than the husband’s.  In the absence of certain relevant matters, on the basis of this imbalance in initial contributions one might expect the Court to make a finding about overall contributions in favour of the wife.  But in my view, such a finding would be quite unfair to the husband.  This is because, in my view, the wife has acted recklessly in borrowing the level of funds from U Mortgages and spending so much borrowed money on the business at a time when it should have been obvious to her that business was failing.  In my view, her recklessness lay in the fact that she misrepresented the true financial position of the business to the financier U Mortgages and was quite dishonest in her successful endeavour of persuading U to lend her money which, had she dealt honestly with the financier, would almost certainly not have been available to be ultimately lost by the wife.  In those circumstances, in my view, most of the responsibility for the loss of these funds should be that of the wife alone and certainly not attributed to the husband.

9. But this loss has to be considered against the initial imbalance of contributions and also without losing sight of the fact that the husband has also lost significant monies through his gambling activities the quantum of which is unable to be ascertained.

10. In all these circumstances, in my view, the parties’ contributions overall should be assessed as having been equal.

s 75(2) matters

1. The husband is 75 years of age and there are some questions concerning his state of health.  He suffers from diabetes and says that he lacks energy.  He says that he is struggling to meet his work commitments.  He proposes to reduce his hours of employment by approximately one-half.  He says that the consequence will be a reduction in his income from approximately $3500 gross per week to approximately $2000 gross per week.

2. On the other hand, the wife is 43 years of age.  Her source of income had been the business but now that it is in administration the wife no longer has such income.  Before commencing to assist the husband in his health practice the wife had been working as a doctor’s receptionist.  In my view, the wife should be able to resume work of this nature.

3. As indicated above, the wife has remarried and her husband is Mr K.  Mr K is a carpenter.  When he works he earns approximately $500 per week.  The wife and Mr K share household expenses.

4. The parties’ daughter L resides primarily with the wife.  As indicated above I am satisfied that the wife has been the primary parent of the child.  On present indications one would expect the child to continue to live with the wife.  The child attends Z College at V and she was in Year 10 last year.  Her school fees are approximately $944 per term.  The child has had some emotional and psychological problems and has been assisted by a child psychiatrist and her school counsellor.

5. The husband has been paying child support at the rate of $500 per week.  He says that this amount is too high and he proposes to endeavour to have the amount reduced by the Child Support Agency.  In any event, he says that he proposes to retire from health practice this year.  If this was to occur, it is difficult to see that the husband would have any capacity for making financial provision for the child.

6. In summary, the husband has had an income-earning capacity much stronger than that of the wife.  But his age is such that one would accept that his capacity to earn income in the future is very limited.  He has no superannuation.  On the other hand, the wife’s capacity for earning income is probably as a receptionist as I have said.  While she is much younger than the husband and should have many income-earning years ahead, she did not manage the businesses successfully.  To some extent this might affect her employability.  Her husband should be able to earn income, albeit also at a modest level and thereby be in a position to assist the wife in meeting some of their household expenses.  But the wife also has the primary care of L who will not attain adulthood for a couple more years.

7. In all the circumstances, in my view the s 75(2) matters in favour of each of the parties counterbalance so that this is not a case where it is appropriate to set off a proportion of property in favour of one or the other in order to achieve a just and equitable order.

The fourth step

1. This was a marriage and cohabitation of approximately 14 years and there is one child.  The wife had considerably more property than the husband at the outset and the husband earned the vast majority of household income.  The wife acted recklessly in relation to borrowing money without consulting the husband and she has lost significant money which otherwise would have been available to the parties.  The husband also lost money through gambling.

2. Unfortunately the parties’ business activities have concluded in disaster with many debts to be paid.  This was largely as a consequence of poor business management which enabled an employee of the business to steal a very considerable amount of money from the business.

3. The order I propose will have the effect of dividing the parties’ property between them in equal shares.  The orders I propose will not affect the income-earning capacity of either party.

Conclusion

1. As indicated above there is a surplus of property after taking account of liabilities with a value of $169 296.  This is to be distributed to the parties in equal shares.  Accordingly, each of the parties will enjoy property with a value of $84 648 ($169 296 : 2 = $84 648).

2. The husband has the following property:

1.        G Company	$27,756
2.        1994 Ford motor vehicle	$3,000
_________
$30,756

1. If the wife was to transfer to the husband her shares in the company G Pty Limited he would have a further $4070 worth of property.  This would provide the husband with total property having a value of $34 826.

2. For the husband to achieve property with a value of $84 648 he would require a payment of $49 822 ($84 648 - $34 826 = $49 822).  The wife will be required to pay the husband this amount.

3. The wife will be required to complete the sale of the property at W1 and to discharge the mortgage thereon from the proceeds of sale.

4. The parties will be required to sell the property at W2 and to discharge the mortgage thereon.  On current figures this would produce a sum of $305 000 ($480 000 - $175 000 = $305 000).

5. From these funds the parties will be required to pay the following liabilities:

$
1.        Commission on sale of W1	10,000
2.        Shortfall on sale of W1	10,000
3.        C Accountants	21,517
4.        H, Solicitors	3,321
5.        Land tax (2 years)	8,445
6.        G Consolidated Pty Limited	209,932
7.        Balance towards liabilities of G Freight Services	41,785

1. This will leave $34 723 outstanding to the creditors of G Freight Services ($76 508 - $41 785 = $34 723).

2. The wife will be required to sell her time share at R and her interest in the home unit at T Macedonia, and to pay the proceeds ($27 000) to the creditors of G Freight Services.  This would then leave $7723 owing to creditors of G Freight Services ($34 723 - $27 000 = $7723).

3. This and all other liabilities otherwise unpaid as identified at paragraph 39 above are to be the responsibility of the wife and she is to indemnify the husband in relation thereto.

1. On the other hand the wife has the following property:

$
1.        Interest in property E	166,667
2.        Home unit in T, Macedonia	15,000
3.        Time share at T	12,000
4.        Bank accounts	1,192
5.        Superannuation	13,952
6.        Ford Fairmont (add back)	2,200
__________
$211,011

1. As indicated above the wife will be responsible for the following liabilities:

$
1.        Loan from her parents	20,000
2.        Australian Tax Office	260
3.        Source Mastercard	12,348
4.        Go Mastercard	6,986
5.        O Valuers	1,124
6.        V Valuers	1,100
7.        G Freight	34,723
__________
$76,541

1. On this basis, the wife would have a surplus of property after paying liabilities with a value of $134 470 ($211 011 - $76 541 = $134 470).  But the wife will have to pay the husband the amount of $49 822.  This would leave the wife with property with a value of $84 648 ($134 470 - $49 822 = $84 648).  This is her share of the property available for division between the parties which in my view is the appropriate result.

I certify that the preceding eighty (80) paragraphs are a true copy of the reasons for judgment of Judicial Registrar W P Johnston.

Associate:     ___________________

Date:              25 January 2007

IT IS NOTED that this judgment for all publication and reporting purposes be referred to as Benson & Benson