BLAKE and BAAS & Ors

[2020] FCWA 229

JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA

ACT: FAMILY COURT ACT 1997

LOCATION: PERTH

CITATION: BLAKE and BAAS & Ors [2020] FCWA 229

CORAM: TYSON J

HEARD: 12, 13, 14, 17, 18, 19, 20, 21, 24, 25, 26 FEBRUARY and 28 JULY 2020

DELIVERED : 24 DECEMBER 2020

FILE NO/S: PTW 3664 of 2016

BETWEEN: MS BLAKE

Applicant

AND

MR BAAS

First Respondent

AND

MS PRIESTLY

Second Respondent

AND

AB PTY LTD

Third Respondent

AND

CD PTY LTD

Fourth Respondent

Catchwords:

FAMILY LAW – PROPERTY – De facto relationship – Whether it is just and equitable to make an order altering property interests – Identification of the existing legal and equitable interests of the parties in property – Consideration whether assets are property or a financial resource – Consideration as to whether superannuation interests are property of a party to the de facto relationship – Consideration as to whether debts are owing by the de facto wife to various entities, who are parties to the proceedings – Where it is found to be just and equitable to make an order altering property interests – Where the assessment of contributions overwhelmingly favour the de facto husband – Where it is found the de facto wife has wasted funds – Where both parties to the de facto relationship have failed to make full and frank disclosure – Consideration of s 205ZD of the Family Court Act – Justice and equity – Case turns on its own facts

Legislation:

Child Support (Assessment) Act 1989 (Cth)
Corporations Act 2001 (Cth)
Evidence Act 1906 (WA)
Family Court Act 1997 (WA)
Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth)
Family Provision Act 1972 (WA)
Interpretation Act 1984 (WA)
Limitation Act 2005 (WA)
Property Law Act 1969 (WA)
Rules of the Supreme Court 1971 (WA)

Category: Not Reportable

Representation:

Counsel:

Applicant	:	Mr Berry SC
First Respondent	:	Mr Solomon SC, Ms Anderson and Mr Firios
Second Respondent	:	Mr Hooper SC
Third Respondent	:	N/A
Fourth Respondent	:	N/A

Solicitors:

Applicant	:	Klimek & Wijay Family Lawyers
First Respondent	:	Hammond Legal
Second Respondent	:	Carr & Co
Third Respondent	:	N/A
Fourth Respondent	:	N/A

Case(s) referred to in decision(s):

Ascot Investments Pty Ltd v Harper (1981) 148 CLR 337

Bevan & Bevan (2013) FLC 93-545

BP v KS (2003) FLC 93-157

Brandi v Mingot (1976) 51 ALJR 207

Briese & Briese (1986) FLC 91-713

C & C [1998] FamCA 143

Calvin & McTier (2017) FLC 93-785

Carter and Carter (1981) FLC 91-061

Chancellor & McCoy (2016) FLC 93-752

Chang v Su (2002) FLC 93-117

Chapman & Chapman (2014) FLC 93-592

Chorn and Hopkins (2004) FLC 93-204

Coley v Danae [2020] WASCA 13

Commonwealth v Milledge (1953) 90 CLR 157

Cook v Langford (2008) FLC 93-374

Dahl & Hamblin (2011) FLC 93-480

Dulton & Dulton [2020] FamCAFC 209

Elias and Elias (1977) FLC 90-267

Fabre v Arenales (1992) 27 NSWLR 437

Farmer & Bramley (2000) FLC 93-060

Ferraro and Ferraro (1993) FLC 92-335

Fielding and Nichol (2014) FLC 93-617

Fields & Smith (2015) FLC 93-638

Figgins and Figgins (2002) FLC 93-122

Fotia and Welsh [2013] FCWA 112

GB Energy Ltd v Protean Power Pty Ltd [2009] WASC 333

GBT & BJT [2005] FamCA 683

Gleeson v Gleeson [2002] NSWSC 418

Goodwin and Goodwin Alpe (1991) FLC 92-192

Gorga and Gorga [2020] FCWA 51

Gould and Gould (1993) FLC 92-434

Grady & Chilcott [2020] FamCAFC 143

Grier & Malphas (2016) 55 Fam LR 107

Hall v Hall (2016) 257 CLR 490

Hurst & Weber (2009) 233 FLR 337

Jones v Dunkel (1959) 101 CLR 298

Kennon v Kennon (1997) FLC 92-757

Khademollah and Khademollah (2000) FLC 93-050

Kowaliw & Kowaliw (1981) FLC 91-092

Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361

L v C [2005] FCWA 23

Lenehan and Lenehan (1987) FLC 91-814

Little & Little (1990) FLC 92-147

Livesey v Jenkins [1985] AC 424

Lovine & Connor and Anor (2012) FLC 93-515

MacGregor v MacGregor (1996) FLC 92-710

Mallet v Mallet (1984) 156 CLR 605

Morrison and Morrison (1995) FLC 92-573

Norbis v Norbis (1986) 161 CLR 513

O’Meara v Dominican Fathers (2003) 153 ACTR 1

Ogilvie v Adams [1981] VR 1041

Payne v Parker [1976] 1 NSWLR 191

Rolfe and Rolfe (1979) FLC 90-629

Rosati and Rosati (1998) FLC 92-804

Smith & Smith (1991) FLC 92-261

Stay v Stay (1997) FLC 92-751

Steinbrenner & Steinbrenner [2008] FamCAFC 193

Trevi & Trevi (2018) FLC 93-858

Vismay & Shaw [2014] FamCAFC 124

Wallis & Manning (2017) FLC 93-759

Waters and Jurek (1995) FLC 92-635

Watson & Ling (2013) FLC 93-527

Weir and Weir (1993) FLC 92-338

Wunderwald and Wunderwald (1992) FLC 92-315

Zyk and Zyk (1995) FLC 92-644

Table of Contents

Contents

JURISDICTION

DRAMATIS PERSONAE AND DEFINED TERMS

WHAT ARE THE ORDERS SOUGHT?

Orders sought by Ms Blake

Orders sought by Mr Baas

Orders sought by Ms Priestly

Orders sought by AB Pty Ltd

Orders sought by CD Pty Ltd

BRIEF BACKGROUND

2001 Orders

Sale of assets by the Baas Group and Mr Baas’ beneficiary loan accounts

Notice of Default – 2001 Orders

Family Court proceedings

Application to wind up the Baas Group

Notice of Relinquishment

THE PARTIES AND THEIR EVIDENCE

What was the evidence relied upon?

The trial

Assessment of the parties and their evidence

Ms Blake and her witnesses

Mr Baas and his witnesses

Ms Priestly

Inferences from Mr Baas’ failure to call certain witnesses

THE LAW

DISCLOSURE

Have Ms Blake and Mr Baas complied with their obligations to provide full and frank disclosure?

WHAT IS THE PROPERTY OF THE PARTIES?

Baas Group

Composition of the Baas Group

FU Pty Ltd

Mr Baas’ beneficiary loan accounts

What is Mr Baas’ interest in the Baas Group?

AB Discretionary Trust

IJ Trust

MN Discretionary Trust

JQ Trust

Conclusions

What is the effect of the 2001 Orders on Mr Baas’ interest in the Baas Group?

Conclusions

What is the value of Mr Baas’ interest in the Baas Group?

Debt to AB Pty Ltd

Is the Loan Agreement a deed?

Is the Loan Agreement a contract?

Conclusions

Debt to CD Pty Ltd

Rental for Property D

Debt owing by Ms ZA to Ms Blake

Other personal property

Ms Blake’s personal loans

Visa card repayments

Should Mr Baas’ superannuation be treated as property?

Property A

Conclusions

WHAT IS THE DURATION OF MR BAAS AND MS BLAKE’S RELATIONSHIP?

FINANCIAL CIRCUMSTANCES AT COMMENCEMENT OF COHABITATION

MS BLAKE’S ACCESS TO FUNDS

Cheques

Access to funds

iSaver transfers

Debit card and credit card expenditure

Salary

Rental income

Conclusions

ACQUISITION OF PROPERTIES & THE FINANCIAL CIRCUMSTANCES OF THE PARTIES’ RELATIONSHIP

Property A

Property N

Property L

Property B

Property M

Property F

Property D

Property E

Boats

Property O

HOMEMAKER AND OTHER NON-FINANCIAL CONTRIBUTIONS

CIRCUMSTANCES AT SEPARATION

Property C

Post-separation

Ms Blake’s inheritance

Other

IN LIGHT OF THE PROPERTY OF THE PARTIES, IS IT JUST AND EQUITABLE TO MAKE AN ORDER AS TO ALTERATION OF PROPERTY INTERESTS?

A separate but very careful deliberation

What does each party say?

ADD BACKS

Paid legal fees

Property E

Conclusions

CONTRIBUTIONS

Approach to the assessment of contributions

Conclusions

SECTION 205ZD(3) FACTORS

(a) the age and state of health of each of the de facto partners

(b) the income, property and financial resources of each of the de facto partners and the physical and mental capacity of each of them for appropriate gainful employment

(d) commitments of each of the de facto partners that are necessary to enable the party to support:

(f) subject to subsection (4), the eligibility of either party for a pension, allowance or benefit under:

(g) a standard of living that in all the circumstances is reasonable

(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income

(i) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party

(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account

ASSESSMENT OF SECTION 205ZD(3) FACTORS

JUST AND EQUITABLE

Winding up

Notice of Relinquishment

Vesting

Injunctions

SCHEDULE 1: DRAMATIS PERSONAE

SCHEDULE 2: KEY OF DEFINED TERMS

TYSON J:

WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL JUDGMENT – PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN CHANGED

IT IS NOTED that publication of this judgment by this Court under the pseudonym Blake and Baas & Ors has been approved by the Family Court of Western Australia pursuant to s 243(8)(g) of the Family Court Act 1997 (WA).

1 [Ms Blake], the Applicant, and [Mr Baas], the First Respondent, were in a de facto relationship which ended in February 2016. Following the breakdown of the relationship, Ms Blake seeks orders by way of alteration of property interests, including an order that Mr Baas pay her $8 million. Mr Baas says it is not just or equitable to make any orders.

2 There is a significant dispute between Mr Baas and Ms Blake as to the composition of their property. According to Ms Blake, the parties’ combined property and superannuation entitlements are worth in excess of $85 million, while Mr Baas considers the value is around $6 million.

3 Ms Blake and Mr Baas each hold an acute sense of what they perceive to be fair and just. Each party genuinely, and strongly, believes they have been treated unfairly by the other. Those views have become more entrenched since separation, compounded by the present proceedings.

4 Mr Baas is aggrieved by Ms Blake’s failure to repay monies he says were loans from [AB Pty Ltd] and [CD Pty Ltd]. It is his case that he was financially generous to Ms Blake and her family. He tried to assist Ms Blake to achieve financial independence. He trusted Ms Blake and considers she abused that trust, by dishonestly taking money which he only discovered after separation. He accuses Ms Blake of giving false evidence. Mr Baas is critical of Ms Blake’s imprudent financial decisions since separation, where she is now looking to him to effectively subsidise those poor choices.

5 Ms Blake denies taking funds without Mr Baas’ knowledge. It is her case that Mr Baas agreed and authorised her access to accounts, which she applied for their joint benefit, to support their lifestyle and to spend as she saw fit. She sacrificed her career to pursue her relationship with Mr Baas. She trusted Mr Baas and is disappointed with her current financial predicament. Ms Blake described Mr Baas’ approach to the proceedings as aggressive, forensic and highly litigious, including a relentless interrogation on every dollar she had access to, designed with a “long held motivation to minimise the extent of his wealth and to maximise the extent of [her]… indebtedness”.[1]

[1] Paragraph 8, Ms Blake’s outline of closing submissions filed 10 July 2020.

6 These proceedings are governed by the Family Court Act 1997 (WA) (“the Act”).[2] The Court must not make an order for alteration of property interests, unless it is satisfied that in all the circumstances, it is just and equitable to make the order. There is no assumption that the parties’ rights or interests to property should be different from those that exist. There is no assumption that any party has the right to have the property of the parties divided between them.[3]

[2] References in cited cases to identical provisions of the Family Law Act 1975 (Cth) ("the Family Law Act") have not been altered in this judgment.

[3] Stanford v Stanford (2012) 247 CLR 108 (“Stanford”).

7 There are a number of issues which require determination, including:

•What is the duration of Mr Baas and Ms Blake’s relationship?

•Have Mr Baas and Ms Blake complied with their obligations to provide full and frank disclosure?

•What is the identity and value of the property of Mr Baas and Ms Blake, according to ordinary common law and equitable principles? As part of that issue, the following questions require resolution:

•What assets form part of the [Baas] Group?

•Are Mr Baas’ beneficiary loan accounts his personal property, or part of the Baas Group?

•What is the effect of Family Court Orders between Mr Baas and his former wife, on Mr Baas’ interest in the Baas Group?

•Is Mr Baas’ interest in the Baas Group property or a financial resource?

•Should Mr Baas’ superannuation entitlements be treated as property?

•What are Ms Blake’s liabilities? Is Ms Blake indebted to AB Pty Ltd and CD Pty Ltd and if so, what amount does she owe? Does Ms Blake owe money by way of personal loans? What amount does Ms Blake’s sister owe to Ms Blake?

•What is the value of Ms Blake’s personal property?

•In light of the parties’ existing interests, is it just and equitable to make an order by way of alteration of property interests?

•Did Ms Blake receive and/or retain funds without Mr Baas’ knowledge or consent?

8 If I determine that it is just and equitable to make an order, then I must:

•Identify the relevant contributions of the parties and assess them;

•Consider the relevant matters referred to in s 205ZG(4)(d) – (g) of the Act; and

•Determine what orders, if any, adjusting the property, assets and liabilities of the parties are just and equitable.

9 For the reasons that follow, I am satisfied it is just and equitable to make an order by way of alteration of property interests.

JURISDICTION

10 It is common ground that Mr Baas and Ms Blake were in a de facto relationship for the purposes of Part 5A of the Act. It is agreed the de facto relationship exceeded two years, Ms Blake was a resident in Western Australia on the day her application was made, and both parties resided in Western Australia for at least a third of their relationship.[4] Ms Blake’s application was made within two years of the end of the relationship.[5]

[4] Section 205Z of the Act.

[5] Section 205ZB of the Act.

11 It is accepted the Court has jurisdiction to make an order altering the property interests of Ms Blake and Mr Baas, if it is satisfied that in all of the circumstances, it is just and equitable to do so.

DRAMATIS PERSONAE AND DEFINED TERMS

12 For ease of reference, a schedule of defined terms, the relevant entities and persons involved in this case are set out in schedules 1 and 2, attached to these Reasons. It is helpful, at the outset, to identify the parties, key individuals and entities.

13 Ms Blake was born [in] 1964. She is 56 years of age and is primarily engaged as a homemaker. She also works as [a beautician]. Ms Blake has two adult children from a previous marriage; [Mr Z] born [in] 1984 and [Ms Y] born [in] 1986. Ms Y is married to [Mr X]. Ms Blake lives in [Suburb A], in rent-free accommodation. She is not in a relationship.

14 Mr Baas was born [in] 1947. He is 73 years of age and is a company director. Mr Baas is currently in a relationship with [Ms W]. Mr Baas was previously married to [Ms U]. They have an adult daughter, [Ms T] born [in] 1974.

15 [Ms Priestly] was born [in] 1953. She is 67 years of age and is a [marine biologist]. Ms Priestly is the Second Respondent. Mr Baas and Ms Priestly married [in] 1985 and separated [in] 1998. They have three adult children: [Mr S] born [in] 1985, [Mr R] born [in] 1991 and [Mr Q] born [in] 1993.

16 AB Pty Ltd is the Third Respondent. CD Pty Ltd is the Fourth Respondent. Mr Baas is the sole director of AB Pty Ltd and CD Pty Ltd. Mr Baas and Ms Priestly hold all of the issued shares in both companies. By agreement, the Third and Fourth Respondents were not separately represented at the trial.

17 Following the breakdown of the marriage between Mr Baas and Ms Priestly, they resolved financial matters. [In] 2001 orders were made by consent between Mr Baas, Ms Priestly, AB Pty Ltd, [EF] Pty Ltd, [GH] Pty Ltd as Trustee for the [IJ] Trust and [KL] Pty Ltd (“2001 Orders”).[6]

[6] Exhibit 16, Orders made by consent in the Family Court of Western Australia, by a registrar in chambers dated 2001.

18 The 2001 Orders sought to “deal comprehensively with the ownership, management and control of the [Baas] Group”[7] (“Baas Group”). They provide for Mr Baas to direct, control and administer the Baas Group, subject to constraints, warranties and indemnities in favour of Ms Priestly. The 2001 Orders are attached to these Reasons and marked schedule 3[8]. Mr Baas and Ms Blake do not agree on t-he composition and categorisation of the Baas Group.

[7] 2001 Orders, Order 2.

[8] For the purposes of anonymisation Schedule 3 containing the 2001 Orders has been omitted.

19 [Mr V] is the internal accountant and financial controller of the Baas Group. Mr V and Mr Baas have a professional relationship, exceeding 25 years. Mr Baas provides instructions to Mr V to implement agreements and transactions which he, or entities within the Baas Group, enter into. Those transactions included the loan agreement between AB Pty Ltd and Ms Blake, and the advance of funds by CD Pty Ltd to Ms Blake.

20 [Mr P] is a solicitor who has a longstanding professional and personal relationship with Mr Baas. Mr Baas previously owned [Property A], which was and remains his home. Property A is now owned by the [MN] Discretionary Trust, of which Mr P is the appointor and guardian. Mr P and Mr Baas have agreed Mr Baas can occupy Property A for his lifetime, subject to meeting the outgoings.

21 [In] 2005 Mr Baas executed a Notice of Relinquishment, witnessed by Mr P. Mr Baas deposed he executed the Notice of Relinquishment to make it clear he had no beneficial interest in the Baas Group, subsequent to the 2001 Orders. That remained his position up until shortly prior to trial, when Mr Baas indicated he no longer relied upon the Notice. Mr Baas did not call Mr V or Mr P as witnesses at the trial.

WHAT ARE THE ORDERS SOUGHT?

Orders sought by Ms Blake[9]

[9] Further amended Minute of Orders Sought, Ms Blake’s outline of closing submissions filed 10 July 2020.

22 In summary, Ms Blake seeks Mr Baas pay her $8 million, net of tax, within 90 days. If he fails do so, she seeks Mr Baas exercise his rights to wind up the Baas Group, to then pay her $8 million. She seeks orders to render ineffective the Notice of Relinquishment. She proposes to retain all monies she has received from Mr Baas, or any entity in which he has an interest. If Ms Blake is found to owe money to any entity, she seeks Mr Baas pay the amounts and indemnify her. She seeks various injunctions, restraining Mr Baas personally and in his capacity as a director and shareholder of various entities, from taking any action against her, “arising out of the de facto relationship”.[10] If Ms Blake is joined or named as a defendant in any legal action “in relation to the [Baas] Group”, including proceedings commenced by Ms Priestly or any entity in which Ms Priestly is or was an officeholder or shareholder, she seeks Mr Baas pay her costs and indemnify her in terms of any orders made against her.[11]

[10] Paragraph 9 of the further amended Minute of Orders Sought, Ms Blake’s outline of closing submissions filed 10 July 2020.

[11] Paragraph 10 of the further amended Minute of Orders Sought, Ms Blake’s outline of closing submissions filed 10 July 2020.

23 Ms Blake seeks to retain [Property C], her personal effects, shares, savings and superannuation entitlements. She proposes Mr Baas retain his property, including his superannuation entitlements.

Orders sought by Mr Baas

24 Mr Baas seeks the dismissal of Ms Blake’s application. He supports the application of CD Pty Ltd and AB Pty Ltd for Ms Blake to repay monies advanced to her during the relationship. He does not agree Ms Blake owes rent to AB Pty Ltd, as claimed by Ms Priestly and AB Pty Ltd. He disputes the amounts Ms Priestly claims Ms Blake owes by way of principal and interest on the loan to AB Pty Ltd.[12]

[12] Exhibit 1, lines 20, 21 and 25.

Orders sought by Ms Priestly[13]

[13] Ms Priestly’s amended Minute of final orders sought at trial forming part of her Papers for the Judge filed 24 January 2020.

25 Ms Priestly seeks the dismissal Ms Blake’s application to wind up the Baas Group. She seeks Ms Blake pay AB Pty Ltd $800,304 together with interest of $1,881,487 up to 30 September 2019, or such other interest as the Court deems appropriate. She seeks Ms Blake repay AB Pty Ltd the rental income Ms Blake received for [Property D] quantified at $104,132. She seeks Ms Blake pay $480,000 to CD Pty Ltd and unpaid interest.

Orders sought by AB Pty Ltd

26 AB Pty Ltd seeks Ms Blake pay $857,700 plus interest, and the rental income Ms Blake received for Property D.[14]

[14] The Minute filed 7 August 2019, but was not served on Ms Blake until 23 January 2020.

Orders sought by CD Pty Ltd

27 CD Pty Ltd seeks Ms Blake pay $480,000 plus interest.[15]

[15] The Minute filed 7 August 2019, but was not served on Ms Blake until 23 January 2020.

BRIEF BACKGROUND

2001 Orders

28 The 2001 Orders were the focus of close scrutiny at trial and require careful consideration, because they are material to the question of Mr Baas’ legal and equitable interest in the Baas Group.

29 The 2001 Orders sought to end the financial relationship between Mr Baas and Ms Priestly, avoid further proceedings between them,[16] and govern the management of the Baas Group.[17]

[16] Pursuant to s 81 of the Family Law Act 1975 (Cth).

[17] 2001 Orders, Recital D and orders 6 – 14.

30 At that time, the Baas Group had an agreed value in excess of $20 million.[18] The Baas Group is now agreed, for the purpose of the present proceedings, to be worth $100 million.[19]

[18] 2001 Orders, Recital E.

[19] Orders made by consent as between Mr Baas and Ms Priestly and not opposed by Ms Blake, dated 8 April 2019.

31 The Baas Group was defined in Order 3, as all entities owned or controlled by Mr Baas from time to time, not limited to those entities specified in Schedule 1, and excluding the personal property of Mr Baas and Ms Priestly, set out in Schedules 2 and 3. Order 4 noted Schedule 1 identified the composition of the Baas Group at that time, but it was agreed by all parties to the 2001 Orders that “during the term and subject to these orders, the composition of the [Baas] Group may change”. Schedule 1 is set out below in full.[20]

[20] 2001 Orders, Order 4.

COMPANY NAME	DIRECTORS	SHAREHOLDERS	NO. OF ISSUED SHARES
[AB] Pty Ltd	• [Mr Baas]	• [Mr Baas] (99%) • [Ms Priestly] (1%)	100
[GH] Pty Ltd	• [Mr Baas]	• [Mr Baas] (100%)	100
[IJ] Pty Ltd	• [Mr Baas]	• [Mr Baas] (100%)	2
[EF] Pty Ltd	• [Mr Baas] • [Mr O]	• [Mr Baas] (99.9%) • [Mr O] (0.1%)	180,000
[OP] Pty Ltd	• [Mr N] • [Mrs N] • [Mr Baas]	• [QR] Pty Ltd (67%) • [Mr Baas] (33%)	105
[KL] Pty Ltd	• [Mr Baas]	• [Mr Baas] (5%) • [AB] Pty Ltd atf [AB] Discretionary Trust (95%)	1100
[ST] Pty Ltd	• [Mr Baas] • [Mr M]	• [AB] Pty Ltd atf [AB] Discretionary Trust (100%)	2
[UV] Pty Ltd	• [Mr L] • [Mr K] • [Mr Baas]	• [AB] Pty Ltd atf [AB] Discretionary Trust (25%) • [WX] Pty Ltd atf [Mr K] Family Trust (37.5%) • [YZ] Pty Ltd aft [AZ] Trust (37.5%)	120
[UV] Developments Pty Ltd	• [Mr L] • [Mr K] • [Mr Baas]	• [AB] Pty Ltd atf [AB] Discretionary Trust (70%) • [WX] Pty Ltd atf [Mr K] Family Trust (15%) • [YZ] Pty Ltd aft [AZ] Trust (15%)	105
[BY] Pty Ltd	• [Mr L] • [Mr K]	• [UV] Developments Pty Ltd (100%)	800,000
[CX] Pty Ltd	• [Mr L] • [Mr K] • [Mr J] • [Mr H]	• [UV] Developments Pty Ltd (33.3%)	2,700,000
[DW] Pty Ltd	• [Mr G] • [Mr F]	• [AB] Pty Ltd

TRUST NAME	TRUSTEE	APPOINTOR	GUARDIAN	PRIMARY BENEFICIARIES	UNITS ISSUED
[AB] Discretionary Trust	[AB] Pty Ltd	[Mr Baas]	[Mr Baas]	• Children of [Mr Baas]	N/a
[IJ] Trust	[GH] Pty Ltd	[Mr Baas]	[Mr Baas]	• [Mr Baas] • [Mr T]	N/a
[GH] Pty Ltd Superannuation Fund	[IJ] Pty Ltd	None	None	Sole member is [Mr Baas]	N/a
[EV] Unit Trust	[EV] Pty Ltd	None	None	• [AB] Pty Ltd atf [AB] Discretionary Trust – (35 units) • [QR] Pty Ltd (70 units)	105
[UV] Unit Trust	[UV] Pty Ltd	None	None	• [AB] Pty Ltd atf [AB] Discretionary Trust – (30 units) • [YZ] Pty Ltd atf CJC Trust (45 units) • [WX] Pty Ltd atf [Mr K] Family Trust (45 units)	105
[UV] Developments Unit Trust	[UV] Development Pty Ltd	None	None	• [AB] Pty Ltd atf [AB] Discretionary Trust – (84 units) • [YZ] Pty Ltd atf [AZ] Trust (18 units) • [WX] Pty Ltd atf [Mr K] Family Trust (18 units)	105

32 The 2001 Orders require Mr Baas and the Baas Group to:

•“be just and faithful [to Ms Priestly]… to ensure that the [Baas] Group successfully conducts its Business”;[21]

[21] 2001 Orders, Order 37(a).

•“use their best endeavours to ensure that the [Baas] Group successfully conducts its Business”;[22]

[22] 2001 Orders, Order 37(b).

•“make approvals or decisions… in good faith and in the best interests of the [Baas] Group and the conduct of the [Baas] Group’s Business as a commercial venture”;[23]

[23] 2001 Orders, Order 37(e).

•“ensure that the shares held by [Mr Baas] as described in Schedule 1 are his sole and absolute property”; and[24]

[24] 2001 Orders, Order 37(j).

•“ensure that the only directors of those companies are directors as specified in Schedule 1”[25] to maintain control over the entities forming part of the [Baas] Group.

[25] 2001 Orders, Order 37(p).

33 The 2001 Orders require Mr Baas and the Sub-Group[26] to supply Ms Priestly with management and financial information and reports on an ongoing basis concerning the “Net Value of the [Baas] Group”. Mr Baas is obliged to ensure the continued proper conduct and management of the Baas Group and the general financial and operational status of the Baas Group.[27] Ms Priestly is entitled to ongoing access to specified documents, in relation to the Baas Group.[28]

[26] 2001 Orders, the ‘Sub Group’ was defined as collectively AB Pty Ltd, EF Pty Ltd, GH Pty Ltd, KL Pty Ltd, each of whom were parties to the 2001 Orders.

[27] 2001 Orders, Order 7.

[28] 2001 Orders, Orders 7–14.

34 If Mr Baas and the Sub-Group breach any terms of the 2001 Orders, (defined as an Event of Default[29]) Ms Priestly can issue a notice requiring remedy of the Default on terms specified by her, and failing which, Ms Priestly can issue a notice to wind up the Baas Group.[30]

[29] 2001 Orders, Order 34.

[30] 2001 Orders, Order 35.

35 Ms Priestly’s consent is required for certain transactions by the Baas Group, including capital expenditure, borrowing, changes to the nature of the business, disposal of any assets of the Baas Group[31] and any alteration to the shareholding, distribution or vesting of any trust capital.[32]

[31] 2001 Orders, Order 13.

[32] 2001 Orders, Order 14.

36 The 2001 Orders provide for Mr Baas to manage and administer the Baas Group, until one of three trigger events, which then requires either the ongoing management of the Baas Group, or for the Baas Group to be wound up.

37 In the event of Mr Baas’ death or total permanent disablement (defined as a Permanent Trigger Event[33]) ownership, management, control and administration of the Baas Group passes to Ms Priestly and Mr Baas has no further claim or rights in respect of the Baas Group. If Mr Baas becomes incapacitated, or unable to fulfil his obligations (defined as a Temporary Trigger Event[34]) Ms Priestly will take over management, control and administration of the Baas Group.[35] If the net value of the Baas Group falls below $20 million, then Ms Priestly will be appointed as a director, joint appointor and guardian and have equal voting rights to Mr Baas.[36]

[33] 2001 Orders, Recital G and Orders 16 and 21.

[34] 2001 Orders, Order 15.

[35] 2001 Orders, Order 17(a).

[36] 2001 Orders, Order 25.

38 The 2001 Orders provide mechanisms for the Baas Group to be wound up and the assets distributed between Mr Baas and Ms Priestly.[37] If a wind up is instituted:

[37] 2001 Orders, Orders 30, 31, 32 and 33.

(a)After a Permanent Trigger Event, Ms Priestly will receive 100% of the proceeds of the wind up;[38]

[38] 2001 Orders, Order 33(b).

(b)After a Temporary Trigger Event, or a Net Value Trigger Event, Mr Baas and Ms Priestly will share in the proceeds of the wind up equally;[39] and

[39] 2001 Orders, Order 33(c) and (d).

(c)By Mr Baas. In that event, Mr Baas will receive 60% and Ms Priestly will receive 40% of the proceeds of the winding up, regardless of their equitable interests.[40] There is also provision for a wind up at the election of both Mr Baas and Ms Priestly. [41]

[40] 2001 Orders, Order 33(a).

[41] 2001 Orders, Order 30(a) (b).

39 I will return to these matters later in the Reasons.

40 The 2001 Orders provided Mr Baas retain his personal assets, (set out in Schedule 2) which included Property A,[42] all savings, his entitlements

[42] See paragraph 20 of these Reasons.

41 under the [GH] Superannuation Fund,[43] “loans or debts of any nature owed from time to time by the [Baas] Group to or for the benefit of the Husband”, together with shares in [FU] Pty Ltd.

[43] As it was then known. Now the [GT Pty Ltd] Superannuation Fund.

42 Mr Baas was required to pay spousal maintenance to Ms Priestly,[44] and Ms Priestly retained her personal property (set out in Schedule 3).

[44] 2001 Orders, Order 1.

Sale of assets by the Baas Group and Mr Baas’ beneficiary loan accounts

43 Following the 2001 Orders, the Baas Group has sold three assets of substance: in 2006 it sold the [DW business] for approximately $45 million; in 2007 it sold the assets and business owned by GH Pty Ltd for around $62 million; and in 2010 it sold EF Pty Ltd for $4.5 million.

44 In 2008, the IJ Trust resolved to distribute the proceeds of sale of GH Pty Ltd (of approximately $42 million) to Mr Baas personally, in his capacity as a beneficiary of the trust. That decision was made with Ms Priestly’s consent, to minimise the capital gains tax payable. Mr Baas did not physically receive the funds, which he lent to the Baas Group and which is reflected as a loan recorded by [GT Pty Ltd] as trustee for the IJ Trust. The relevant resolution was not in evidence. Around $8 million was physically drawn down in the 2008 financial year. In subsequent years, further drawings were made, the benefit of Mr Baas, Ms Priestly and their children, which have been deducted from the beneficiary loan account. Dividends received by Mr Baas from various shareholding, have been assigned to discharge Division 7A loans within the Baas Group, which are reflected in increases to his beneficiary loan account. Mr Baas’ beneficiary loan account with the IJ Trust has a current balance of approximately $15.16 million.

45 Ms Blake asserts Mr Baas’ beneficiary loan account with the IJ Trust is his personal property, separate to his interest in the Baas Group. Mr Baas and Ms Priestly say the loan account forms part of the Baas Group, is governed by the 2001 Orders and is included in the agreed value of the Baas Group of $100 million.

Notice of Default – 2001 Orders

46 During the relationship, Mr Baas caused entities within the Baas Group to advance funds to Ms Blake, and purchase a car for her use. Ms Priestly discovered those transactions[45] after Mr Baas and Ms Blake separated. Ms Priestly then issued Mr Baas with a Notice of Default, dated [late] 2016.[46] The Notice of Default asserted Mr Baas was in default of the following 2001 Orders:[47]

[45] Paragraph 122, Ms Priestly’s trial affidavit filed 30 May 2019.

[46] Exhibit 2, of Ms Priestly’s trial affidavit filed 30 May 2019.

[47] Notice of Default, Exhibit 2 of Ms Priestly’s trial affidavit filed 30 May 2019.

(a)Order 13(b):

a.[In] 2013, [Mr Baas], in his capacity as a director of [AB] Pty Ltd, caused [Motor Vehicle A] to be purchased, at a cost of $57,466, being expenditure of a capital nature outside of the ordinary course of business, without having first obtained [Ms Priestly]’s written consent (First Breach).

(b)Order 13(g):

a.[In] 2007, [Mr Baas], in his capacity as a director of [AB] Pty Ltd, caused the company to advance either by way of a gift or loan $800,304 to [Ms Blake], with such transaction being outside the ordinary course of business and was conducted without having first obtained [Ms Priestly]’s written consent (Second Breach).

b.[In] 2015, [Mr Baas], in his capacity as a director of [CD] Pty Ltd, caused the company to advance either by way of a gift or loan $480,000 to [Ms Blake], with such transaction being outside the ordinary course of business and was conducted without having first obtained [Ms Priestly]’s written consent (Third Breach).

47 The Notice of Default required Mr Baas to remedy the breaches, within 14 days,[48] by paying or causing to be paid:

[48] Pursuant to the 2001 Orders, Order 52.

(a)$1,337,770 net of tax, to [Ms Priestly], being the total of the sums of the First, Second and Third Breaches;[49] or

[49] Notice of Default clause 3.1.2.1, Exhibit 2 of Ms Priestly’s trial affidavit filed 30 May 2019.

(b)$480,000 to [CD] Pty Ltd, the subject of the Third Breach[50] and $857,770 to [AB] Pty Ltd, the subject of the First and Second Breaches.[51]

[50] Notice of Default clause 3.1.2.2.1, Exhibit 2 of Ms Priestly’s trial affidavit filed 30 May 2019.

[51] Notice of Default clause 3.1.2.2.2, Exhibit 2 of Ms Priestly’s trial affidavit filed 30 May 2019.

48 Ms Priestly reserved her right to issue further default notices to Mr Baas for “any or all of the breaches contained within this Notice”, requiring Mr Baas to “undertake further and other actions to rectify the breaches”.[52] If Mr Baas did not rectify the breaches, Mr Baas was given notice Ms Priestly “may exercise her right to issue a winding up notice pursuant to orders 30 and 36 of the Orders without further notice”.[53]

[52] Notice of Default clause 4.1.1 Exhibit 2 of Ms Priestly’s trial affidavit filed 30 May 2019.

[53] Notice of Default clause 4.1.2 Exhibit 2 of Ms Priestly’s trial affidavit filed 30 May 2019.

49 [In late] 2016, Ms Priestly received $1 million, net of tax, from drawings against Mr Baas’ beneficiary loan account with the IJ Trust. Ms Priestly’s evidence was that the payment satisfied in full the Notice of Default.[54] Mr Baas’ evidence was that he simply decided to make a payment to Ms Priestly, unrelated to the Notice of Default.[55] I do not accept Mr Baas’ evidence, which was neither credible nor plausible. It was also inconsistent with his sworn evidence in response to Ms Blake’s Request for Answers to Specific Questions.[56] In light of the items Ms Priestly’s Notice ascribed as constituting a default by Mr Baas of his obligations under the 2001 Orders; the subsequent payment Mr Baas directed in favour of Ms Priestly; the acknowledgement by Ms Priestly’s solicitors that the payment satisfied the Notice; the failure of Mr Baas’ solicitors to suggest otherwise; and his sworn evidence accepting he “overstepped the bounds of the 2001 Orders”[57] and agreed to Ms Priestly’s demand for payment, I consider the payment was pursuant to the Notice of Default.

[54] Paragraphs 126 and 128 of Ms Priestly’s trial affidavit filed 30 May 2019.

[55] Transcript (“TS”) Day 10, page 1041.

[56] Paragraph 17 of Mr Baas’ Affidavit filed 4 February 2020.

[57] Paragraph 17 of Mr Baas’ Affidavit filed 4 February 2020.

50 The payment of $1 million net of tax, was less than the $1,337,770 sought. There was no explanation as to why that was.

Family Court proceedings

51 Since 2016, Mr Baas and Ms Blake have been involved in lengthy, protracted litigation, the chronology of which does not require repetition. On 31 October 2016, Ms Priestly was joined as a party. On 26 July 2019, AB Pty Ltd and CD Pty Ltd were joined as parties.

52 There are two features of the proceedings which require comment; Ms Blake’s application to wind up the Baas Group and Mr Baas’ reliance on the Notice of Relinquishment.

Application to wind up the Baas Group

53 On 23 June 2017, Ms Blake sought the Baas Group be wound up[58] and the quantum of her claim be determined after liquidation of the Baas Group.[59] She maintained her application to wind up the Baas Group in her further amended Initiating Application filed 4 August 2017[60] and in her Minute of Orders Sought filed in January 2019.[61] In March 2019, Ms Blake proposed, for the first time, for the winding up of the Baas Group only in the event Mr Baas failed to pay her $8 million.[62]

[58] Paragraph 3, Ms Blake’s particulars.

[59] Paragraph 5(f), Ms Blake’s particulars.

[60] Refer to Orders 3, 6 and 7.

[61] Paragraph 3 of the Ms Blake’s Minute filed 23 January 2019.

[62] Paragraph 5, of the Ms Blake’s Minute filed 12 March 2019.

54 Mr Baas and Ms Priestly consistently opposed any order that would see the Baas Group wound up. Ms Priestly maintained any order to wind up the Baas Group, before a determination of Ms Blake’s entitlements, if any, was premature and not appropriate.

55 Ms Priestly proposed Ms Blake’s application to wind up the Baas Group be deferred, pending determination as to whether any orders should be made by way of alteration of property interests and if so, what orders were just and equitable. In my view, Ms Priestly’s proposal was sensible and commercial. There was no proper basis for Ms Blake to seek a winding up of the Baas Group, other than as to enforce any entitlement she might establish.

Notice of Relinquishment

56 Mr Baas executed a Notice of Relinquishment, [in] 2005, in the following terms:

I, [MR BAAS] of [Property A], am the Husband named in the Minute of Consent Orders dated [in] 2001 as made by the Family Court pursuant to order 14 Rule 8 [in] 2001.

I hereby give notice that I relinquish, surrender and otherwise renounce all my rights and interest whatsoever in the ownership and control of the [BAAS] GROUP OF COMPANIES as described by clause 3 of those Orders and waive irrevocably and unconditionally any rights or entitlements I have or may have, whether express or implied, under or pursuant to clause 30 of those Orders.

57 Ms Priestly and Ms Blake only learned of the Notice of Relinquishment, upon being served with Mr Baas’ affidavit filed 5 August 2016. Mr Baas proffered no explanation for his 11 year delay in providing the Notice to Ms Priestly, given the impact the Notice would have on her entitlements, in light of the 2001 Orders.

58 Mr Baas relied on the Notice from the commencement of these proceedings, maintaining he was simply a trustee of various entities within the Baas Group. On that basis, Mr Baas refused to disclose various documents.[63]

[63] Paragraph 11 of Mr Baas’ affidavit filed 20 April 2018, “My interest in the [Baas] Group is as a Trustee only and so I do not agree many of the documents sought by Ms Blake are relevant to these proceedings”.

59 Mr Baas explained he executed the Notice of Relinquishment to: “ensure there was no misunderstanding” of his position within the [Baas] Group, which “in my mind made absolutely clear that I was not the beneficial owner of any of the property of the group”;[64] “…record in writing that I was not the beneficial owner of any of the property of the [Baas] [G]roup in the event that this ever became an issue of dispute in the future”;[65] and avoid any future dispute, which “included for any future personal relationship that I might have”.[66]

[64] Paragraph 7 of Mr Baas’ affidavit filed 5 August 2016.

[65] Paragraph 19 of Mr Baas’ affidavit filed 19 December 2016.

[66] Paragraph 39 of Mr Baas’ affidavit filed 15 March 2019.

60 A preliminary hearing was scheduled to determine the effect of the Notice of Relinquishment, which did not proceed.

61 On 5 February 2020, an Outline of Opening Submissions was filed on behalf of Mr Baas, which stated contrary to earlier indications, Mr Baas no longer relied on the Notice of Relinquishment.[67] On the first day of trial, Senior Counsel for Mr Baas stated, “in terms, in black and white, that no reliance will be placed as part of the First Respondent’s case on the Notice of Relinquishment”.[68]

[67] Paragraph 43.

[68] TS Day 1, page 65.

62 Ms Priestly confirmed she does not rely upon the Notice of Relinquishment in these proceedings, including any potential enforcement application nor any appeal.[69]

[69] TS Day 7, page 705.

63 Ms Blake described Mr Baas’ conduct in relation to the Notice of Relinquishment as abusive, causing the litigation to be more complex and costly,[70] and demanded the joinder of Ms Priestly to the proceedings.[71] She says Mr Baas failed to adequately explain his revised position.

[70] Paragraphs 19(e), 32 and 33 of Ms Blake’s closing submissions.

[71] Paragraph 33 all of Ms Blake’s closing submissions.

64 Mr Baas’ reliance on the Notice of Relinquishment did not require the joinder of Ms Priestly to the proceedings. Ms Priestly was a necessary party because of Ms Blake’s application to wind up the Baas Group, given her rights and interest in the Baas Group pursuant to the 2001 Orders.

65 Mr Baas says he withdrew reliance on the Notice of Relinquishment because it was not stamped.[72] I do not accept that explanation. It was open to Mr Baas to have the Notice stamped, noting the AB Loan Agreement (upon which he relied) was only stamped shortly prior to trial.[73] No satisfactory explanation was offered by Mr Baas for his late change in position.

[72] TS Day 10, page 993.

[73] For example, Exhibit 6 the AB Loan Agreement.

66 Ms Blake seeks a declaration that the Notice of Relinquishment is a sham, with no legal effect, or that the Notice is ineffective at law, or an order setting aside the Notice pursuant to s 222 of the Act. For the reasons that follow,[74] I am not satisfied it is appropriate to make any of those orders.

[74] See paragraphs 478-481 of these Reasons.

67 Mr Baas’ reliance on the Notice of Relinquishment until a week prior to trial, is a material matter which has impacted upon his disclosure, my assessment of his credibility and his conduct as a litigant.

68 Ms Blake suggested Mr Baas embarked upon an abusive course of litigation. In my view, criticisms can be properly levelled against both Mr Baas and Ms Blake, with respect to aspects of their conduct as litigants, to which I will turn to shortly.[75]

[75] See paragraphs 121-127 of these Reasons.

THE PARTIES AND THEIR EVIDENCE

What was the evidence relied upon?

69 Ms Blake relied upon her affidavits filed 21 December 2018, 8 January 2020 and 4 February 2020, together with her financial statements filed 21 December 2018 and 8 January 2020, her undertaking as to disclosure filed 14 January 2019 and the affidavits of [Ms E], [Ms D] and Ms Y each filed 21 December 2018.

70 Mr Baas relied upon his affidavits filed 15 March 2019, 6 May 2019 and 4 February 2020, his undertaking as to disclosure filed 30 April 2019 and financial statement filed 17 May 2019, together with the affidavits of [Mr C] filed 4 June 2019, [Mr M] filed 17 May 2019 and [Mr B] filed 12 February 2020.

71 Ms Priestly relied upon her affidavits filed 30 May 2019 and 5 February 2020.

The trial

72 The trial was listed for an estimated hearing time of nine days. The evidence was completed in 11 days. The trial was adjourned for closing submissions for a further day. 45 documents were tendered as exhibits, which comprised 11 lever arch files.

73 Mr B, Mr M and Ms D were not required for cross‑examination. I accept their unchallenged evidence. The parties and the other witnesses all attended trial and were cross-examined.

74 I have considered the evidence very carefully. I have not referred to all of the evidence because it is neither necessary, nor practical, to do so.[76] If I have not referred to the evidence of a witness, or part of it, it should not be assumed I have disregarded or overlooked it.

[76] Vismay & Shaw [2014] FamCAFC 124 at [45].

Assessment of the parties and their evidence

75 There was a high degree of bitterness and animosity between Mr Baas and Ms Blake. Each holds a poor view of the other. I consider those views, at times, infected their evidence. Neither Ms Blake nor Mr Baas were impressive witnesses. I formed the view each of them gave evidence with an eye to the outcome they sought, tailoring their evidence in an attempt to advance their own case. Mr Baas and Ms Blake each gave sworn evidence, which was incorrect and unreliable.

76 Many of the issues now in dispute relate to events which occurred some time ago. In that regard, each party relied on their recollection. In many instances, there was no documentation to assist and the credibility of each party was a matter of some significance. To compound these difficulties, neither Ms Blake nor Mr Baas discharged their duty to provide full and frank disclosure in a timely manner. I was unable to simply accept either party’s evidence, in the absence of corroboration, concession or where it was supported by objective evidence. As a consequence, on certain factual disputes, I have accepted the evidence of one party and not the other.

Ms Blake and her witnesses

77 Ms Blake was extensively cross-examined over six days. In my view, Ms Blake attempted to give her evidence in a frank manner, but struggled to do so. Ms Blake repeatedly referred to her [learning difficulties], her health and the stress she had experienced by way of explanation for errors in her evidence, her lack of recollection and inability to answer questions. Mr Baas’ Senior Counsel suggested whenever Ms Blake was asked a difficult question, she claimed to be either unwell, innumerate or [had learning difficulties]. That was a recurring theme in her evidence.

78 To her credit, Ms Blake made a number of concessions against self‑interest. She acknowledged she had not carefully read her affidavits which she had sworn as true and correct. She conceded her affidavits contained multiple errors.[77] She accepted she had a poor memory and lacked a reliable recollection of dates and events.[78] She acknowledged she had forgotten many things,[79] she suffered from “brain fog”[80] and had attempted to establish dates through referencing photographs.[81] Ms Blake plainly struggled with numbers, stating she was not a “figures person” and she “didn’t know [her] times-tables”. Ms Blake acknowledged some of her evidence was exaggerated.[82]

[77] TS Day 5, page 68.

[78] TS Day 2, page 61, Day 2, page 31 and Day 3, page 93.

[79] TS Day 5, pages 44, 49 and 52.

[80] TS Day 2, page 36.

[81] TS Day 5, page 52.

[82] TS Day 6, page 69.

79 In many areas, Ms Blake’s evidence was simply unreliable and contradicted by documentation, to which I will refer in more detail later in the Reasons. Ms Blake’s sworn evidence contained a litany of errors, which could have been readily resolved by her, or by those she instructed, through cross-referencing documents. Despite the passage of time between swearing her trial affidavit and the trial, Ms Blake did not do so, nor seek to correct her affidavit when afforded the opportunity to do so. Ms Blake’s sworn evidence was careless. Ultimately, it is Ms Blake’s responsibility and obligation as a litigant, to provide accurate, truthful evidence.

80 In my view, Ms Blake exaggerated and overstated her efforts in supporting Mr Baas’ efforts in relation to the Baas Group. I did not consider Ms Blake was honest or truthful in relation to many matters. For example:

(a)She initially maintained she and Mr Baas commenced living together in 2004.[83] That was not correct.

[83] Exhibit 20, paragraph 11, Ms Blake’s affidavit filed 27 June 2016.

(b)Ms Blake repeatedly maintained she had never signed the loan agreement with AB Pty Ltd and implied that her signature had been forged. That was untrue.

(c)Ms Blake deposed she forgot about her Bankwest account, by way of explanation for her failure to disclose the account. She subsequently conceded she had deliberately not disclosed the account.[84]

[84] TS Day 3, page 56.

(d)Ms Blake’s evidence regarding a number of property transactions, to which I will refer, were simply false.

81 Ms Y is Ms Blake’s daughter. Ms Y gave her evidence in a direct and candid manner. While Ms Y is clearly supportive of her mother, I did not form the view her evidence was tainted as a result. She described Mr Baas as very generous to her. I consider she gave truthful evidence.

82 Ms E is a friend of Ms Blake. She was not seriously challenged in cross-examination. I found her to be an honest witness.

83 I accept Ms D’s unchallenged evidence. She joined Mr Baas and Ms Blake on a number of holidays. She testified about the work Ms Blake did to host guests, and her observations of Ms Blake’s involvement in renovating Property A.

Mr Baas and his witnesses

84 Mr Baas was a difficult witness. In my view, he attempted to give his evidence in a frank manner, but like Ms Blake, struggled to do so. To his credit, Mr Baas made some concessions against self-interest. He acknowledged he did not understand many of the commercial structures and various transactions, stating “all this is the very reason why I work outside. I find this very complicated. I’d sooner drive a truck”.[85] He explained he [had learning difficulties][86] and was not computer literate. As a result, Mr Baas said he relied on others, including Ms Blake (when they were in a relationship), Mr V, (the internal accountant for the Baas Group), his current partner Ms W, together with his solicitors.[87]

[85] TS Day 10, page 994.

[86] TS Day 10, page 981.

[87] For example TS Day 9, page 848, Day 10, pages 1020-1021.

85 Mr Baas was guarded and cautious in responding to many questions, leading me to conclude he was not always prepared to be open or honest. For example, when Mr Baas was asked about his ability to wind up the Baas Group, and the Notice of Relinquishment, he refused to answer questions on the basis he required legal advice.[88] He repeatedly interrupted questions being put to him, with the phrase “legal advice”.

[88] TS Day 9, page 914.

86 His own counsel accepted Mr Baas displayed frustration, he had a tendency to become argumentative and emotional during cross‑examination, and demonstrated a limited grasp[89] of the financial aspects of the Baas Group.

[89] Paragraphs 28 and 32, Mr Baas’ reply to Ms Blake’s closing submissions filed 24 July 2020.

87 Mr Baas was unwilling to answer many questions which were fairly put to him, despite being directed to do so. He repeatedly failed to listen to questions and sought to argue his case. He was often evasive, defensive and argumentative. On occasions, he simply refused to answer questions, preferring to provide statements or ask questions.[90] His contempt towards Ms Blake and her claim were palpable.

[90] TS Day 9, page 920 and TS Day 9, page 1058 and Day 10, pages 1099 and 1100.

88 Mr Baas’ evidence was difficult to follow. For example, when he was asked if statements made by his Senior Counsel in opening were correct, Mr Baas replied, “it was accurate, but … it could be a mistake as well”.[91]

[91] TS Day 10, page 1021.

89 When asked about a number of documents, Mr Baas frequently claimed he had never seen the document before, he was unaware of the contents and said it was his practice to sign documents without reading them, including the 2001 Orders. It defies belief that Mr Baas had not read the 2001 Orders. That was also inconsistent with his sworn evidence, which detailed his understanding of the 2001 Orders. There were other instances in which his oral evidence contradicted his sworn evidence.[92]

[92] See paragraph 64 of these Reasons.

90 There were additional aspects in which I did not find Mr Baas’ evidence reliable or truthful, to which I will refer to later in the Reasons.

91 Mr C is the former CEO of [HS] Group, which purchased GH Pty Ltd from the Baas Group. He and Mr Baas have a longstanding professional and personal relationship. Mr C’s affidavit was prepared by Mr P. He was not seriously challenged in cross-examination. I consider that he gave truthful evidence. I accept Mr C did not discuss business‑related matters with Ms Blake.

92 I accept the unchallenged evidence of Mr M, who is a long‑time business associate to Mr Baas. Mr M denied having any discussions with Ms Blake about the Baas Group or Mr Baas. He deposed at best, Ms Blake may have been present and overheard discussions between himself and Mr Baas; she was not directly involved, nor did she participate.

Ms Priestly

93 Ms Priestly was an impressive witness, who presented as an intelligent and articulate individual. She gave her evidence in a careful, considered and measured manner. It was apparent she had a more sophisticated understanding of the commercial operation of the Baas Group than Mr Baas.

94 Ms Priestly and Mr Baas enjoy a good relationship. Their financial circumstances continue to be aligned through the 2001 Orders. Notwithstanding their relationship, Ms Priestly and Mr Baas do not always agree. For example, Ms Priestly disagreed with Mr Baas’ proposal to appoint Ms T and Mr S[93] as trustees of trusts within Baas Group. They have argued about Mr Baas’ expenditure on boats, and his desire to buy a submarine.[94]

[93] Mr S is the adult son of Mr Baas and Ms Priestly. Ms T is Mr Baas’ adult daughter from a previous marriage.

[94] TS Day 11, page 1192.

95 Ms Priestly has sought to assert her rights, independently from Mr Baas. She opposed Mr Baas’ application, in these proceedings, to be relieved of his undertaking not to commence proceedings on behalf of AB Pty Ltd and CD Pty Ltd in [another jurisdiction] against Ms Blake. While Ms Priestly has a clear interest in the outcome of the proceedings, and she seeks to protect and preserve her interests, she impressed me as a truthful witness.

Inferences from Mr Baas’ failure to call certain witnesses

96 Ms Blake says the Court should infer that Mr Baas’ failure to call Mr V[95] and Mr P[96] was designed to:

[95] The internal accountant of the Baas Group.

[96] Mr Baas’ friend, who witnessed the 2001 Orders and the Notice of Relinquishment. Mr P is also the appointor and guardian of the MN Discretionary Trust which owns Property A, where Mr Baas resides.

(a)prevent the Court and Ms Blake having a full picture of Mr Baas’ financial circumstances; and[97]

[97] Paragraph 8 of Ms Blake’s outline of closing submissions filed 10 July 2020.

(b)avoid Mr V and Mr P giving evidence on material matters.[98]

[98] Paragraph 9 of Ms Blake’s outline of closing submissions filed 10 July 2020.

97 In Jones v Dunkel (1959) 101 CLR 298 Error! Bookmark not defined. at 312, Menzies J summarised the law as follows:

In my opinion a proper direction in the circumstances should have made three things clear: (i) that the absence of the defendant… as a witness cannot be used to make up any deficiency of evidence; (ii) that evidence which might have been contradicted by the defendant can be accepted the more readily if the defendant fails to give evidence; (iii) that where an inference is open from facts proved by direct evidence and the question is whether it should be drawn, the circumstances that the defendant disputing it might have proved the contrary had he chosen to give evidence is properly to be taken into account as a circumstance in favour of drawing the inference.

98 What a party is required to explain, or contradict, depends upon the issues raised in the case and the evidence.[99] If the principle is found to apply, then adverse inferences may be drawn from the failure of a party to adduce particular evidence, where such evidence would reasonably have been expected. If a person is likely to be able to speak on some fact in issue, then one would reasonably have expected that party to call the person.[100]

[99] O’Meara v Dominican Fathers (2003) 153 ACTR 1.

[100] Fabre v Arenales (1992) 27 NSWLR 437.

99 The rule applies in circumstances which establish that the witness would be expected to be called by one party, rather than another. For example, where the witness might be regarded as “in the camp” of one party,[101] so as to make it unrealistic for the other party to call that witness.

[101] Payne v Parker [1976] 1 NSWLR 191, at [201] – [202].

100 The rule permits an inference that the evidence of the absent witness, would not have assisted the party.[102] It does not permit an inference that the evidence of the absent witness would have been unfavourable to the party’s case.[103] The failure to give evidence, cannot fill an evidentiary gap the opponent’s case.[104]

[102] Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361, at [64].

[103] Brandi v Mingot (1976) 51 ALJR 207.

[104] Jones v Dunkel (supra).

101 However, where an evidentiary basis for a fact in issue has been established, an inference favourable to one party may be more confidently drawn when a person able to put a “true complexion on the facts relied on as the ground for the inference”[105] has not been called as a witness by the other party, and the evidence provides no sufficient explanation of that absence. Similarly, evidence which might have been contradicted by such a witness, can be accepted more readily if the witness is not called.

[105] Jones v Dunkel (supra), at 308.

102 In relation to Mr V:

•Mr Baas and Mr V have had a professional relationship exceeding 25 years. Mr Baas explained Mr V attends “all the banks…my tax, my super and he looks after all my paperwork”.[106] Mr V provides financial information to Mr Baas, including the profit and loss, the available bank balances for entities within the Baas Group and Mr Baas’ superannuation.[107]

[106] TS Day 10, page 969.

[107] TS Day 10, page 968 and Exhibit 37.

•Mr Baas frequently referred to his reliance on Mr V during his evidence. Mr Baas instructed Mr V to document transactions, he requested Mr V collate and provide documents by way of disclosure and in response to subpoena. Mr Baas generally signs, without reading, documents which Mr V has had prepared.[108]

[108] TS Day 10, page 970.

•I am satisfied Mr V is reasonably expected to be available to Mr Baas. Mr V can be regarded as “in the camp” of Mr Baas, so as to make it unrealistic for Ms Blake to call him.[109] That is consistent with the fact Mr V swore an affidavit on 5 June 2018 in support of Mr Baas.[110]

[109] Payne v Parker (supra), at [201] – [202].

[110] Exhibit 31, Mr V’s affidavit sworn 5 June 2018.

•Mr Baas was on notice that the Court would be required to determine a number of issues, in relation to which Mr V would be able to lead relevant evidence, including:

•The arrangements to establish the loan between Ms Blake and AB Pty Ltd, the removal of the loan from the financial statements of AB Pty Ltd, and the subsequent reinstatement of the loan, following separation, all of which involved Mr V.

•The extent to which Mr Baas was aware and authorised Ms Blake’s access to funds, including her access to Mr Baas’ bank accounts, her credit card expenditure and the retention by Ms Blake of the rent for Property D.

•The alleged debt owing by Ms Blake to the IJ Trust, post‑separation, based upon her credit card expenditure during her relationship with Mr Baas.

•Mr Baas’ instructions to Mr V in relation to the purchase of [Property E] and subsequent transactions (which were dealt with in Mr V’s affidavit).

•The allocation of the proceeds of sale of GH Pty Ltd to Mr Baas’ beneficiary loan account with the IJ Trust, and the subsequent drawings made against the loan account (which were touched upon in Mr V’s affidavit).

•In light of Mr Baas reliance on, and instructions to Mr V, Mr V would be able to lead evidence on each of these matters. I consider it was reasonable to expect Mr V to be called as a witness. Mr Baas proffered no explanation for his failure to call Mr V.

•Mr Baas maintained Ms Blake obtained funds without his knowledge and authority, which Ms Blake denied. In circumstances where Mr V was intimately involved in Mr Baas’ financial dealings, his failure to call Mr V was not reasonably explained.

103 I will deal with the inferences to be drawn from the failure to call Mr V later in the Reasons. The failure by Mr Baas to call Mr V left me with a number of unanswered questions.

104 In relation to Mr P:

•Mr Baas and Mr P have a longstanding professional and personal relationship.

•Mr P witnessed the Notice of Relinquishment and the 2001 Orders. Mr P has acted for Mr Baas throughout these proceedings. Mr P spoke with Mr C about his evidence, prior to his affidavit being sworn.[111] Mr P was present in court, for a number of days throughout the trial. It was reasonable to infer Mr P was available to be called by Mr Baas.

[111] TS Day 7, pages 683-686.

•Ms Blake initially submitted Mr Baas had a legal interest in Property A, which she abandoned by the conclusion of the trial.

•Neither Mr Baas nor Ms Blake relied on the Notice of Relinquishment. While Ms Blake raised questions about the nature of the relationship between Mr Baas and entities in which Mr P has an interest, these were not pursued at trial. In these circumstances, even if Mr P was called as a witness, I am not satisfied his evidence would have been directed to facts in issue between the parties.

105 I therefore decline to draw any inference from the failure to call Mr P as a witness.

THE LAW

106 There was no dispute between the parties about the relevant legal principles. These proceedings are governed by s 205ZG of the Act.[112] Orders altering the property interests of the parties may only be made if the Court is satisfied that it is just and equitable to make such orders.[113]

[112] Which is identical to the terms of s 79 of the Family Law Act 1975 (Cth). To the extent that the authorities refer to s 79, it is accepted they similarly apply to s 205ZG.

[113] Subsection 205ZG(1) and (3) of the Act.

107 The High Court in Stanford set out three fundamental propositions in terms of the approach to be adopted, which were summarised by the Full Court of the Family Court in Bevan & Bevan (2013) FLC 93-545[114] as follows:

[114] At [73].

1.Determination of a just and equitable outcome of an application for property settlement begins with the identification of existing property interests (as determined by common law and equity);

2.The discretion conferred by the statute must be exercised in accordance with legal principles and must not proceed on an assumption that the parties’ interests in the property are or should be different from those determined by common law and equity;

3.A determination that a party has a right to a division of property fixed by reference only to the matters in s 79(4), and without separate consideration of s 79(2), would erroneously conflate what are distinct statutory requirements.

108 The High Court has observed:

In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).[115]

[115] Stanford (supra) at 122 [42].

(Emphasis in original).

109 It is necessary firstly to identify the existing legal and equitable interests of the parties in their property.

110 Having identified the existing legal and equitable interests of the parties in their property, it is necessary to ascertain whether it is just and equitable to make an order altering those interests. The Court is required to conduct a separate and careful deliberation as to whether it would be just and equitable to make any order, in all the circumstances. In that process, it is permissible to consider the contributions of the parties, but it is not mandatory to do so, nor it is conclusive as to whether the just and equitable test has been met.[116]

[116] Chapman & Chapman (2014) FLC 93-592, [9]; Watson & Ling (2013) FLC 93-527, [12].

111 The expression ‘just and equitable’ has been described as a “particularly elusive concept”[117] and “a qualitative description of a conclusion reached after examination of a range of potentially competing considerations. It does not admit of exhaustive definition. It is not possible to chart its metes and bounds”.[118]

[117] Thackray CJ, sitting in first instance in Fielding and Nichol (2014) FLC 93-617 at [27].

[118] Stanford (supra) at 120 [36].

112 The just and equitable requirement is not a threshold issue, but one which permeates the entire process.[119] The Court must be satisfied it is just and equitable to make an order altering existing property interests, and any order then proposed is also just and equitable.

[119] Bevan & Bevan (supra), at [86]; citing Woollams and Woollams (2004) FLC 93-195, at [53] and Teal & Teal [2010] FamCAFC 120, at [70].

113 If the Court determines it is just and equitable for the parties' interests in their property to be altered, the Court must identify and assess the contributions of the parties within the meaning of ss 205ZG(4)(a),(b) and (c) of the Act. The Court must then identify and assess the relevant matters referred to in ss 205ZG(4)(d) to (g) of the Act, which include those in s 205ZD(3).

114 The Court must consider the respective contributions of the parties, both financial and non-financial, holistically over the whole period to trial.[120] That requires an assessment and analysis of the nature, form and extent of all contributions, of all types. The task does not lend itself to a strictly mathematical approach.[121]

[120] Dickons & Dickons (2012) 50 Fam LR 244, at [21] and Mallet v Mallet (1984) 156 CLR 605, at 640 – 641.

[121] See for example Lovine & Connor and Anor (2012) FLC 93-515, at [41].

115 The assessment does not require a causal relationship between contributions and a financial product of contributions. In Dickons & Dickons (supra) the Full Court of the Family Court of Australia observed:

As is plain from earlier decisions of this Court, regard must be had to the use made of contributions of various types so as to compare the contributions made by each of the parties during the course of, and over the length of, their relationship (see, for example, In the Marriage of Pierce (1998) 24 FLC 92-844) But that is an entirely different proposition to, as it were, causally linking contributions with their asserted financial “product” or “value”. The former recognises that the nature, form and extent of contributions made by each of the parties might differ; the latter suggests that the absence of a causal link counts as no contribution at all.[122]

[122] Dickons & Dickons (supra), at [14].

116 The assessment of contributions is an exercise of a wide discretion, constrained by the relevant legal principles. While it is often convenient and practical for the Court to express its assessment of contributions, or the factors in ss 205ZG(4)(d) to (g) in terms of a percentage, there is nothing in the Act that requires the Court to do so. Similarly, nothing in the Act requires the Court to allocate a percentage entitlement of the property to each party.[123] It is open to the Court to express its assessments and the outcome, in the form of a monetary sum.[124]

[123] See, for example, Cook v Langford (2008) FLC 93-374, at 82,620 [69].

[124] Cook v Langford (supra), at 82,620 [69].

DISCLOSURE

117 The duty on each party to disclose documents in their possession or control in relation to all relevant matters has been described as fundamental to the operation of the Act.[125] A failure to disclose relevant documents will ordinarily give rise to a miscarriage of justice.[126] The duty of disclosure is owed to the Court, and to the other party. The duty encompasses an obligation to disclose all relevant documents, and to disclose all material information.[127]

[125] Briese & Briese (1986) FLC 91-713, cited with approval in Black & Kellner (1992) FLC 92-287.

[126] Morrison and Morrison (1995) FLC 92-573.

[127] Livesey v Jenkins [1985] AC 424.

118 The consequences of the Court finding a party has failed to comply with their disclosure obligations can result in the Court taking a “robust view” about a party’s financial position.[128] The duty to disclose is absolute, and whether the failure to disclose is wilful or accidental, such failure may support the Court erring on the side of generosity to the party who might otherwise be disadvantaged by the lack of candour.[129]

[128] Chang v Su (2002) FLC 93-117.

[129] Chang and Su (supra) 16 Fam LR 154.

119 Where the Court is satisfied there has been material and intentional non-disclosure, it should not be unduly cautious in making findings in favour of the innocent party, as “to do otherwise might be thought to provide a charter for fraud in proceedings of this nature”.[130] It is not the role of the Court to audit a party’s financial records. Each party is required to present evidence as to their financial position in a clear and understandable form.[131]

[130] Weir and Weir (1993) FLC 92-338 at 849.

[131] Fotia and Welsh [2013] FCWA 112, at [96] to [102], (Walters J).

120 The Court was directed to the recent decision of O’Brien J in Gorga and Gorga [2020] FCWA 51, in which his Honour observed:

31The duty is proactive, and will not be satisfied by merely responding to specific request by the other party. That must logically be so, given that the requesting party will generally have incomplete knowledge as to the documents in the possession or control of the other party prior to disclosure being given.

32Consistently with its proactive nature, the duty is continual. Timeliness is central to it. The imposition by the court or by rules of specific timeframes for disclosure of particular documents, or for that matter dates by which formal undertakings as to disclosure must be given, are not intended as the “outer limits” of the obligation to provide disclosure, nor are they to be used as a vehicle for obfuscation.

(Citations omitted)

121 I respectfully agree and endorse His Honour’s remarks.

Have Ms Blake and Mr Baas complied with their obligations to provide full and frank disclosure?

122 In many matters before the Court, there is a complaint about material non-disclosure by one party only. This is not such a case. I am satisfied both Ms Blake and Mr Baas, failed to discharge their obligations. In these circumstances, I do not consider it is appropriate to adopt a robust approach because to do so, would risk operating an injustice. Instead, the failure by Mr Baas and Ms Blake is a factor I take into account in my assessment of their credibility.

123 Ms Blake failed to disclose her Bankwest account, the statements for which were produced on subpoena.[132] Ms Blake deposed she had forgotten about the account and the bank did not identify the account when she made enquiries. Ms Blake opened the account in [Regional Town A] in 2014. She deposited $11,000 on 24 December 2014 and $401,783 on 10 February 2016. On 28 June 2016 Ms Blake withdrew $5,000 in cash, the day after she commenced proceedings. Ms Blake did not disclose the Bankwest account in either her affidavit or financial statement affirmed 20 June 2016. Ms Blake later conceded she had not disclosed the account because she “needed some money”.[133] However, Ms Blake did disclose her NAB account, which then had a balance of $400,000,[134] transferred from her Bankwest account. Her conduct was deceptive, secretive and dishonest. This reflected poorly on Ms Blake and impugned her credit.

[132] Exhibit 11, Ms Blake’s index of disclosure documents as at 10 February 2020 and Exhibit 19, tab 17A.

[133] TS Day 3, page 56.

[134] Exhibit 21, Ms Blake’s financial statement filed 27 June 2016.

124 Ms Blake failed to disclose a Bank Australia account, which I accept she had not used for a number of years. She also failed to disclose the co-ownership agreement relating to [Property F] despite deposing she would do so. Ms Blake did not provide full and frank disclosure of relevant documents concerning the purchase of [Property G], nor of the financial dealing between herself and her sister, to which I will refer in more detail later in these Reasons.

125 The failures by Mr Baas to disclose were more extensive. Ms Blake’s Senior Counsel put to Mr Baas that attempting to obtain disclosure was “like trying to extract teeth from a chicken”. Mr Baas accepted there was “regrettable disorganisation and delay in the disclosure process conducted by his former solicitors”.[135] He suggested he had made full disclosure “of his asset pool”. He submitted many of Ms Blake’s complaints related to her misconstruction of the 2001 Orders and her misunderstanding of his interest in the Baas Group, maintaining those assets do not fall to be counted.[136]

[135] Paragraph 125, Mr Baas’ outline of closing submissions filed 10 July 2020.

[136] Paragraph 125, Mr Baas’ outline of closing submissions filed 10 July 2020.

126 Mr Baas did not disclose many documents in a timely manner, or at all. Having heard his evidence, I am not satisfied Mr Baas took his obligations to provide disclosure seriously. Mr Baas blamed others and failed to accept personal responsibility for his obligations. He accepted he had “no idea” what documents he had disclosed, suggesting “I have people that carry out what I request them to do”. Mr Baas indicated he had outsourced his duty to disclosure to Mr V, which affirms my finding that it was reasonable to expect Mr V to be called to give evidence. He claimed to have provided everything to his solicitors, and if documents had not been provided, it was not his fault. Mr Baas suggested it was incumbent on Ms Blake to identify what documents she wanted and he complied with those requests.

127 It is the obligation of Mr Baas, not his solicitors or any third parties, to provide full and frank disclosure in a timely manner. I am readily satisfied that he failed to do so, and highlight the following, by way of example:

(a)On 31 October 2016 the Court recorded Mr Baas’ advice he would not commence proceedings in any other court or tribunal against Ms Blake, to attempt to recover money allegedly owing to him, or any entity of which he was a director. In June 2019, Mr Baas sought permission to commence proceedings in [another jurisdiction] against Ms Blake. At that time, Mr Baas had not disclosed the 2017 financial statements for the IJ Trust. The 2017 financial statements included an alleged debt owing by Ms Blake of $1,906,340. That debt did not appear in the 2016 financial statements (which Ms Blake obtained through a subpoena to the external accountants of the Baas Group). Mr Baas first disclosed the 2017 and 2018 financial statements in the week prior to trial. The 2017 financial statements were signed in May 2018, when I am satisfied they were within Mr Baas’ possession, custody or control. His failure to disclose those financial statements in a timely manner, was a material failure to provide full and frank disclosure, particularly in light of his application. Ms Blake’s Senior Counsel suggested the alleged debt was a nasty surprise Mr Baas intended to spring on Ms Blake when the proceedings had concluded. Mr Baas’ denial was unconvincing.

(b)Mr Baas failed to disclose his interest in Property E in his first sworn financial statement. When asked, Mr Baas was dismissive, saying he “didn’t think about it”.[137]

[137] TS Day 10, page 979.

(c)Mr Baas, in reliance on the Notice of Relinquishment, refused to disclose numerous documents relating to the Baas Group, on the basis he claimed to have no beneficial interest in the Group.[138] For example, Mr Baas refused to disclose the trust deed, financial statements, and his beneficiary loan account statements for the IJ Trust.[139] Those documents were relevant and Mr Baas had a duty to disclose them.

[138] Exhibit 34, tab 6, Mr Baas affidavit filed 20 April 2018.

[139] Exhibit 27, tab 9.

(d)As a consequence of Mr Baas’ failure to disclose, Ms Blake issued a number of subpoenas including to GT Pty Ltd in its capacity as trustee for the IJ Trust[140] and to AB Pty Ltd[141] as trustee for the AB Discretionary Trust, seeking Mr Baas’ beneficiary loan account statements and/or unpaid present entitlements as at 30 June 2017 and 30 June 2018, and from 30 June 2011, the journals, ledgers, statements or other documents in relation to the deductions made from his unpaid present entitlements. Mr Baas objected to the subpoena, on the basis there had not been any preliminary determination as to the status of the Notice of Relinquishment. He claimed the subpoenas were an “abuse of process”.[142] The objections were discharged on 17 January 2019,[143] however AB Pty Ltd failed to produce any documents pursuant to the subpoena. GT Pty Ltd eventually produced the ledger, pursuant to a further subpoena issued by Ms Blake in November 2019. AB Pty Ltd did not produce the ledger, despite a further subpoena. Mr Baas disclosed both ledgers for the period 1 July 2013 to 30 June 2018 in the week prior to trial. Mr Baas has control of both entities through the Baas Group. I am satisfied the documents sought were both relevant and within Mr Baas’ possession, custody, or control. That finding is corroborated by the fact Mr Baas was able to provide current balances for both beneficiary loan accounts as at 5 February 2020, but did not disclose any up-to-date ledgers.[144]

[140] Exhibit 27, tab 11.

[141] Exhibit 27, tab 10.

[142] Exhibit 27, tabs 12 and 13.

[143] Exhibit 27, tab 14, which was amended on 6 February 2019 to read that the objection was discharged by consent.

[144] Mr Baas’ affidavit filed 5 February 2020.

(e)Mr Baas filed an undertaking as to disclosure on 30 April 2019, which attached a list of his disclosure. That list omitted a significant volume of documents, which were relevant, and within Mr Baas’ possession or control. For example, Mr Baas’ personal income tax return for the year end 2017, various bank statements including his NAB Visa card statements from 13 August 2008 to 12 July 2016 (which he disclosed the day prior to trial), documents in relation to Property E (which were disclosed after 31 January 2020), and the final financial statements for the AB Discretionary Trust, the IJ Trust and GT Pty Ltd for 2016 and 2017 (in circumstances where Mr Baas deposed he “definitely” signed the annual financial statements within 14 months of the end of each financial year).

(f)In October 2016, Mr Baas disclosed the 2008 financial statements for the IJ Trust, which included in the balance sheet Mr Baas’ “Present Entitlement $42,480,106” as a liability of the Trust.[145] In his updated disclosure lists and his subsequent undertakings as to disclosure, the financial statement no longer appeared. No satisfactory explanation was provided by Mr Baas, in circumstances where his beneficiary loan account was plainly relevant. Subsequently, Mr Baas disclosed the IJ Trust balance sheet “As of June 2015” which was prepared in November 2016, after separation. His beneficiary loan account (then $16,982,367), was described as being held “In Trust”.[146] Mr Baas did not disclose any of the intervening financial statements. I consider Mr Baas was selective and strategic, choosing to disclose documents which he perceived assisted his case.

(i) himself or herself; and

(ii) a child or another person that the party has a duty to maintain

450 The parties each have commitments as set out in their financial statements. Ms Blake estimates her reasonable weekly expenses are $1,461, which she is unable to meet from income. A friend pays her utilities. Ms Blake has borrowed money and utilised capital for her support.

451 I do not consider the criticisms made by Mr Baas at the fact Ms Blake bought [Motor Vehicle B] after separation, were fairly made. However, Mr Baas did not suggest her claimed motor vehicle expenses, or indeed her other expenses, were unreasonable. I am satisfied Ms Blake’s expenditure to support herself is both reasonable and modest. I accept Ms Blake says she has curbed her expenditure given her current financial circumstances and she is unable to meet the expenses she would like. Upon the sale of Property C, Ms Blake will then be relieved of the payment of rates and unit levies associated with the property.

452 Ms Blake hopes to obtain her own accommodation, at the conclusion of the proceedings. She has entered into a contract to purchase 34 Tuart Street, Yokine for $495,000, subject to the sale of Property C.

453 Mr Baas estimates his reasonable weekly expenses amount to $2,182, which is less than his weekly income. There was no serious criticism of his expenditure.

(f) subject to subsection (4), the eligibility of either party for a pension, allowance or benefit under:

(i) any law of the Commonwealth, of a State or Territory or of another country; or

(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia,

and the rate of any such pension, allowance or benefit being paid to either party

454 At the time of trial neither party was eligible for a government pension, allowance or benefit. Ms Blake has applied for Centrelink and foreshadowed applying for a disability pension. I have treated Mr Baas’ superannuation as property and as such, this is not a significant factor. I have already observed the absence of evidence as to the taxable, and tax‑free components of Mr Baas’ entitlements.[414] Ms Blake has superannuation entitlements mentioned above.

[414] Exhibit 30, page 542.

(g) a standard of living that in all the circumstances is reasonable

455 The parties enjoyed a high standard of living. Since separation, Mr Baas has been able to maintain his lifestyle. He is likely to do so into the future, having regard to his income, property and financial resources. Ms Blake no longer enjoys the same standard of living she did, during the relationship. I accept she has struggled to support herself post-separation. Her financial circumstances have been impacted by the costs of this litigation, together with her wasteful conduct concerning Property C. Both parties are entitled to a reasonable standard of living.

(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income

456 Ms Blake deposed she wanted to complete a business course in December 2018. Since that time, she has not made any further enquiries.[415] There was no evidence about the cost of the course, or what income or work Ms Blake anticipated she could achieve with the additional training. It did not appear Ms Blake continued to want to undertake additional studies by the time of trial.

[415] Paragraph 229, Ms Blake’s trial affidavit filed 21 December 2018.

(i) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party

457 While Ms Blake suggested she supported Mr Baas throughout the relationship, including involvement in their boat trips, which she described as “business development opportunities for Mr Baas”, I am not satisfied that was the case. Mr Baas’ wealth, his property and financial resources existed prior to his relationship with Ms Blake.

(j) the duration of the de facto relationship and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration

458 The parties were in a de facto relationship for around 8½ years in total. Ms Blake sacrificed her career to pursue the relationship. During the relationship, Ms Blake applied her interior design skills and has since obtained qualifications.

(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account

459 In my view, the following matters require recognition:

(a)Ms Blake has paid $596,180 in legal fees, at least part of which have been met from capital. Mr Baas has paid $863,937 in legal fees, from his superannuation entitlements. Mr Baas has paid Ms Priestly’s legal fees, from his beneficiary loan account.

(b)I have already taken into account the $55,000 Ms Blake owes by way of personal loans, which relate to the funds hold on trust. I accept the monies held on trust, by both Mr Baas and Ms Blake’s solicitors, will be expended in full. Based upon the cost notification letters, Ms Blake and Mr Baas incurred additional costs for the trial. That will impose a further liability. Mr Baas will comfortably be able to meet his costs. Ms Blake will require capital to meet her costs. The payment of legal fees will have a proportionately larger impact on Ms Blake, than Mr Baas, acknowledging the disparity between their respective expenditure.

(c)Ms Blake’s conduct with respect to Property C was wasteful and reckless which resulted in the dissipation of the property now available.[416] Ms Blake’s actions have effectively reduced the property available to her by in excess of $300,000. While that sum may appear modest in light of my findings as to the available property of the parties, it is a material consideration. I do not accept Mr Baas should share in the financial losses unilaterally incurred by Ms Blake, primarily post-separation.

[416] Kowaliw & Kowaliw (1981) FLC 91-092.

(d)Since separation, Mr Baas has gifted to Ms W an interest in Property E, to the value of $200,000. That property no longer exists and is not reflected in the property of the parties.

460 I have adopted the gross value of Mr Baas’ superannuation entitlements and his interest in the Baas Group. If orders are made which made it inevitable or probable that Mr Baas would need to realise that property, then the associated realisation costs, including capital gains tax, should be taken into account. I am not satisfied that is likely and therefore, it is not material.

461 Ms Blake intends to sell Property C. There is no evidence about the anticipated costs of sale.

ASSESSMENT OF SECTION 205ZD(3) FACTORS

462 The purpose of an adjustment for s 205ZD(3) factors is to assist the Court in arriving at a just and equitable result.[417] The objective of the section is not to equalise the financial strengths of the parties, but rather to effect a redistribution, should the Court consider it just and equitable to do so.[418]

[417] See Waters and Jurek (1995) FLC 92-635.

[418] Mallet v Mallet (supra).

463 I consider the significant disparity in the property and financial resources of the parties, keeping in mind their age difference, together with the standard of living enjoyed by them, but no longer enjoyed by Ms Blake, warrant an adjustment in favour of Ms Blake.

464 Ms Blake has not been engaged in paid employment during the parties’ relationship, apart from her work as Mr Baas’ personal assistant. Given Ms Blake’s age, her work history, combined with her qualifications and experience, I accept she has the capacity to work as an interior designer. At best, I expect she can generate a modest income. Ms Blake is 17 years younger than Mr Baas. She has a longer working life ahead.

465 Mr Baas will continue to enjoy a standard of living, including benefits from the Baas Group, far in excess of what Ms Blake can expect. It is reasonable to expect those benefits will continue into the foreseeable future, irrespective of the work he performs, given the wealth which has been created through his efforts.

466 There is and remains an enormous disparity between the parties’ property, resources and income, which requires recognition. The contrast between the parties’ circumstances is stark. While the disparity in the standard of living is relevant, there is no requirement that Ms Blake is entitled to maintain the pre-separation standard, simply because Mr Baas continues to do so.

467 Mr Baas asserted had Ms Blake made more prudent financial decisions post-separation she would have been in a superior financial position than she is at present. Putting her conduct in relation to Property C aside, there are two relevant observations. Firstly, Ms Blake’s legal costs are substantially less than the costs Mr Baas has incurred, in circumstances where I have found Mr Baas has failed in his obligation to provide full and frank disclosure, and where his conduct as a litigant can properly be criticised. I am not making any findings as to the reasonableness or otherwise of the costs, but simply observe this factor has impacted on Ms Blake’s remaining capital, compared to Mr Baas, who had other available sources to meet his costs.

468 Secondly, Ms Blake has had limited income available to meet her expenses and has drawn on capital for her support. In comparison, Mr Baas enjoys ongoing benefits from the Baas Group and his superannuation entitlements, from which he is able to amply meet his expenses.

469 After careful consideration of the evidence, I do not consider that an assessment of these factors by way of a percentage is helpful. I intend to adopt a monetary sum. In my view, that is a more appropriate approach and will ensure an outcome which is just and equitable. It also ameliorates the risk in allocating a percentage, the Court does not lose sight of what the percentage means in dollar terms. In the present circumstances, I consider that risk is real.

470 After careful reflection of the evidence, I consider an adjustment of $750,000 in favour of Ms Blake is just and equitable in the circumstances. That amount properly reflects the disparity in the parties’ circumstances, the disparity in the parties’ respective ages and income earning capacity, in addition to the amounts each party has expended and which is not reflected in the joint property now available for division, together with the funds Ms Blake has wasted.

JUST AND EQUITABLE

471 The overall division of property will be for each party to retain their property, financial resources and superannuation entitlements, together with their respective liabilities. Mr Baas will be required to pay or cause to be paid $1.75 million to Ms Blake. Based upon my findings, the total of the net assets and superannuation is $74,221,880. Ms Blake’s entitlement is $2,328,795. Mr Baas’ entitlement is $71,893,085.

472 That outcome will provide Ms Blake with her car, savings, contents, personal possessions including jewellery, worth $144,974. She will retain her superannuation entitlements of $56,647. She will retain Property C (which is agreed to be worth $700,000), which is to be sold, together with the sum of $263,000 her sister owes to her. The amount Ms Blake has paid on trust to her solicitors will be expended in full by way of legal costs. Ms Blake will be liable for two personal loans totalling $55,000, the debt to CD Pty Ltd of $480,000, together with interest calculated at the date of payment.

473 In addition, Ms Blake will have $1.75 million. On the basis Ms Blake applies the amount to discharge her debts, (referred to above) and towards any additional legal fees she may have, Ms Blake will have over $1 million in cash, in addition to the money she will receive from Ms ZA and on the sale of Property C. Ms Blake can elect to utilise the cash to proceed with the purchase of Yokine and invest the balance, or apply as she sees fit. Alternatively, Ms Blake may invest the funds to generate an income, to support herself moving forward. Ms Blake may elect to utilise some capital to develop the interior design product, to which I have referred.

474 Mr Baas will retain his interest in Property E, his furniture, contents, savings, shares, and his beneficiary loan accounts, together with his interest in the Baas Group. He will retain his superannuation entitlements. I accept the funds held on trust will be expended in full. Mr Baas will continue to have the benefit of occupying Property A. Mr Baas will need to make arrangements to pay the proposed lump sum to Ms Blake. It would appear there are a number of potential ways in which Mr Baas could do so, given my findings as to his available property.

475 Having regard to the matters referred to above, in the context of the parties relationship, I am satisfied the orders I propose are just and equitable.

Winding up

476 I am not satisfied it is appropriate to require Mr Baas to wind up the Baas Group, in the event he fails to pay the amounts required to Ms Blake.

477 As indicated[419] if a wind up were triggered, that would have significant economic consequences, requiring independent advice and supervision as to the timing and method of such a course.[420] A wind up would adversely impact upon the interests of Ms Priestly, by fixing her entitlements at 40% of the value of the Baas Group. A wind up would prevent ongoing operation of the Baas Group, which Mr Baas and Ms Priestly wish to preserve. It would impact on the children of Mr Baas and Ms Priestly, who benefit from the ongoing operation of the Baas Group.

[419] See paragraph 208-209 of these Reasons.

[420] 2001 Orders, Orders 31 and 32.

478 The consequences of a wind up are disproportionate to what is reasonably necessary, and are not just or equitable in the circumstances.

479 Ms Priestly has indicated she will not obfuscate, or prevent Mr Baas taking reasonable steps to comply with any order of the Court. The proposed order is effectively sought by way of premature enforcement, predicated on the basis Mr Baas may not comply with orders of the Court. I decline to grant such an order.

Notice of Relinquishment

480 I am not satisfied an order should be made in terms of paragraphs 1, 2 and 3 as sought by Ms Blake in her amended Minute. The Notice is no longer relied upon by Ms Priestly or Mr Baas. As a consequence, limited attention was directed towards the Notice at trial and the issues arising by virtue of Ms Blake’s claim regarding s 222, until closing addresses.

481 The declarations sought by Ms Blake cannot bind Ms Priestly,[421] as conceded by Ms Blake. Mr Baas accepts the Notice was not legally effective,[422] while not conceding it was a sham.

[421] Section 205ZA(3).

[422] Paragraph 34, Mr Baas’ outline of closing submissions filed 10 July 2020.

482 It is unnecessary, for the purpose of proceedings between Mr Baas and Ms Blake, to make any determination about the Notice.

483 Ms Blake submitted in closing submissions the Court should restrain Mr Baas and Ms Priestly from relying or acting upon the Notice until after she had received her entitlements.[423] That was not an order articulated in her Minute, nor a matter agitated at trial. Where neither Mr Baas nor Ms Priestly rely on the Notice, I am not persuaded such an order is either necessary or appropriate. Again, the proposed order is predicated on the basis Mr Baas may not comply with orders of the Court. I decline to grant the order.

[423] Paragraph 91, Ms Blake’s closing submissions filed 10 July 2020.

Vesting

484 Ms Blake sought an order that all monies she received and/or retained by Mr Baas, or any entity in which he had an interest, should vest in her. She also sought an indemnity from Mr Baas in that regard.

485 When considering what orders to make, a court must, as far as practicable, make such orders as will finally determine the financial relationship between de facto partners and avoid further proceedings between them.[424]

[424] Section 205ZJ of the Act.

486 To give effect to that duty, I consider it is appropriate to make orders which provides Ms Blake is to retain the benefit of the funds she has received and/or retained, excluding the debt which she owes to CD Pty Ltd. Ms Priestly had sought an order that Ms Blake pay “any other sum taken by her or belonging to any entity in the Baas Group” when she filed a Minute for trial in January 2020. While she no longer pressed for that order, it supports my view that it is appropriate that neither Mr Baas, nor Ms Blake, should have further recourse against one another, whether by reference to their relationship or by reference to entities within the Baas Group. I am satisfied that is appropriate, particularly in circumstances where I have found Mr Baas has failed to make full and frank disclosure, given his approach to the proceedings and given the joinder of third parties. Such an order will assist to achieve finality between the parties, and avoid further litigation arising out of the relationship between Mr Baas and Ms Blake.

Injunctions

487 Ms Blake amended the injunctions she proposed by the time of closing addresses.[425] She seeks Mr Baas be restrained from registering caveats on her property,[426] from personally and in his capacity as a director or shareholder of any company, taking any action arising out of the parties’ de facto relationship, against her, outside of any enforcement application, or permitting a third party to do so. Should Ms Blake be named as a defendant in any litigation associated with the Baas Group, she seeks Mr Baas pay her legal costs and any penalty, fine, damages, or judgement debt as may be ordered.

[425] Annexure D to Ms Blake’s closing submissions filed 10 July 2020.

[426] Paragraph 8 of Ms Blake’s amended Minute of Final Orders Sought at trial filed 8 January 2020.

488 I am not satisfied there is any basis to grant the injunction to restrain Mr Baas from registering a caveat on any property owned by Ms Blake. There was no evidence to suggest he had done so, or that he intended to do so. I decline to grant the injunction sought in paragraph 8.

489 I am satisfied it is appropriate and proper to grant the injunction proposed, in paragraph 9, to prevent Mr Baas commencing personally, or on behalf of any entity, any further proceedings against Ms Blake, arising out of the relationship. Those injunctions are necessary, given Mr Baas foreshadowed potential further proceedings against Ms Blake,[427] where Mr Baas has not provided full and frank disclosure and where Mr Baas has failed to identify what, if any, further loans, damages, obligations or facts may give rise to any further claims against Ms Blake[428] In contrast, Ms Priestly does not consider there are any further potential causes of action between Ms Blake, herself, or entities with the Baas Group.[429] However, Ms Priestly gave evidence she had no plans to sue Ms Blake for money allegedly owing to the IJ Trust “at this stage”,[430] suggesting the possibility of further litigation. The evidence does not establish, despite the involvement of the third parties and the forensic approach adopted, that Ms Blake owes any other amounts, to any entities, within the Baas Group.

[427] TS Day 9, page 858, 860 and TS Day 10, page 975.

[428] Exhibit 27, pages 166-167.

[429] Exhibit 27, page 166.

[430] TS Day 10, page 975.

490 I am not satisfied that a further order as proposed by Ms Blake in paragraph 10 is just or proper. Mr Baas will be restrained both personally and in his capacity as a director or shareholder of any entity from taking action against Ms Blake arising out of their relationship. The monies which Ms Blake has received during the relationship, will vest in Ms Blake. In those circumstances, I am not persuaded that it is necessary or proper to make the additional orders proposed.

491 Each party will otherwise retain the property in their possession and indemnify the other in relation to their personal liabilities. In light of the findings I have made, I propose to hear from the parties as to the form of the orders, to give effect to the Reasons, including the timing in which Ms Blake is to pay CD Pty Ltd, inclusive of interest, the timing in which Mr Baas is to pay Ms Blake, and the precise form of the proposed injunctions and indemnities. The parties may wish to consider their options. I therefore propose to give them an opportunity to consider the findings and confer, with a view to submitting a joint Minute of Proposed Orders, to give effect to these Reasons.

SCHEDULE 1: DRAMATIS PERSONAE

Name	Description
Ms Blake	Applicant (“Ms Blake”)
Mr Baas	First Respondent (“Mr Baas”)
Ms Priestly	Second Respondent, former wife of Mr Baas (“Ms Priestly”)
AB Pty Ltd	Third Respondent (“AB Pty Ltd”) Director: Mr Baas – Shareholders: Mr Baas (99 shares) and Ms Priestly (1 share)
CD Pty Ltd	Fourth Respondent (“CD Pty Ltd”) Director: Mr Baas – Shareholders: Mr Baas (180,000 shares)

Applicant’s Associations

Name	Description
Ms TG	Former partner of Mr VE, father of Ms Blake (“Ms TG”)
Mr VE	Father of Ms Blake (“Mr VE”)
Ms ZA	Sister of Ms Blake (“Ms ZA”)
Ms E	Friend of Ms Blake
Ms Y	Ms Blake’s daughter, married to Mr X (“Ms Y”)
Mr Z	Son of Ms Blake (“Mr Z”)
Ms D	Friend of Ms Blake
Mr X	Son-in-law of Ms Blake, married to Ms Y (“Mr X”)

First Respondent’s Associations

Name	Description
Mr M	Long-time business associate to Mr Baas
Mr Q	Son of Mr Baas and Ms Priestly
Ms W	Mr Baas’ current partner (“Ms W”)
Mr V	Accountant for the Baas Group, longstanding professional relationship with Mr Baas (“Mr V”)
Mr C	Former CEO of HS Group, longstanding personal and professional relationship with Mr Baas (“Mr C”)
Ms U	First wife of Mr Baas
Mr R	Son of Mr Baas and Ms Priestly
Ms T	Daughter of Mr Baas and Ms U
Mr P	Long-standing professional and personal relationship with Mr Baas, Appointer and Guardian of the MN Discretionary Trust, owner of Property A, witnessed the Notice of Relinquishment (“Mr P”)
Mr A	Appointer and Guardian of the MN Discretionary Trust
Mr S	Son of Mr Baas and Ms Priestly

SCHEDULE 2: KEY OF DEFINED TERMS

Term	Definition
1983 Deed	Deed establishing The IJ Trust
1992 Deed	Deed establishing The AB Discretionary Trust
2009 Deed	Deed establishing The MN Discretionary Trust
2016 Deed	Deed establishing The JQ Trust
Property D	Property D
Property O	Property O
Property L	Property L, purchased by Ms Blake in June 2007 with funds provided by AB Pty Ltd.
Property N	Property N
2001 Orders	Orders made by consent dated 6 September 2001, between Mr Baas, Ms Priestly, AB Pty Ltd, EF Pty Ltd, GH Pty Ltd as Trustee for the IJ Trust and KL Pty Ltd
Property E	Property E
Council	Council of Owners of the Property C Strata
Property F	Property F
Property C	Property C
Property I	Property I
Loan Agreement	Amended Loan Agreement between AB Pty Ltd Pty Ltd in its capacity as Trustee for AB Discretionary Trust and Ms Blake
GT Pty Ltd	GT Pty Ltd Director: Mr Baas and Alternate Director: Mr VE Shareholders: Mr Baas (99 shares) and Ms Priestly (1 share)
GH Pty Ltd	GH Pty Ltd
FU Pty Ltd	FU Pty Ltd Director: Mr Baas Shareholders: Mr Baas (1 share) and AB Discretionary Trust (480,000 shares)
Property A	Property A
Property M	Property M
Property G	Property G
[Omitted]	[Omitted]
Property B	Property B
Unit 2, Property A	Unit 2, Property A

I certify that the preceding paragraph(s) comprise the reasons for decision of the Family Court of Western Australia.

CD

Secretary

24 DECEMBER 2020