BOLLEN & BOLLEN
[2020] FamCA 605
•23 July 2020
FAMILY COURT OF AUSTRALIA
| BOLLEN & BOLLEN | [2020] FamCA 605 |
| FAMILY LAW – PROPERTY – where after a long marriage the parties agreed on an equal division of assets – where the husband wanted to retain the property he occupied and the wife wanted it sold and the proceeds divided – where the court orders that the husband have the opportunity to retain that property – where the orders provide for the husband to pay the wife a lump sum to effect an equal division of the assets – where there are orders for sale if the husband is unable to make the payment to the wife FAMILY LAW – PROPERTY – Value of Property – Expert Evidence – where the parties appointed a single expert to value their real property – where the wife did not agree with the evidence of the single expert – where the wife applied to the Court on the first day of the hearing to adduce her own expert evidence as to the value of the real properties – where the court gave the wife leave to adduce her own expert evidence – where the wife’s expert and the single expert conferred and agreed upon the value of the real properties– where the wife accepted the value agreed upon by the two experts with respect to the property she occupies but sought leave to cross-examine her own expert as to the value of the real property occupied by the husband – where the wife believes that the property is worth significantly more than the value attributed to it by her own expert witness – where the court is satisfied as to the value and does not believe a sale is required to achieve a just and equitable outcome FAMILY LAW – PROPERTY– addbacks – legal fees – where the parties both paid for their respective legal fees from a joint account – where in all of the circumstances the legal fees spent by both parties are added back in the pool – where the legal fees expended by the husband on behalf of their son are also added back and included in the sum of legal fees expended by the husband |
| Family Law Act 1975 (Cth) ss 79, 75 Evidence Act 1995 (Cth) ss 140, 38 Family Law Rules rr 15.49, 15.42 |
| Bingham v Cumberland County Council (1954) 20 LGR 1 Fricke, Graham L ‘Compulsory Acquisition of Land in Australia (The Law Book Company Limited, 1st edition, 1986) |
| APPLICANT: | Ms Bollen |
| RESPONDENT: | Mr Bollen |
| FILE NUMBER: | MLC | 10697 | of | 2017 |
| DATE DELIVERED: | 23 July 2020 |
| PLACE DELIVERED: | Melbourne |
| PLACE HEARD: | Melbourne |
| JUDGMENT OF: | Macmillan J |
| HEARING DATE: | 16-18 December 2019 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr North SC and Ms Johnston |
| SOLICITOR FOR THE APPLICANT: | Kenna Teasdale Lawyers |
| COUNSEL FOR THE RESPONDENT: | Dr Ingleby |
| SOLICITOR FOR THE RESPONDENT: | Marshalls & Dent & Wilmoth |
ORDERS:
IT IS ORDERED THAT
The matter be listed for mention before Justice Macmillan at 10am on 3 August 2020.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Bollen & Bollen has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT MELBOURNE |
FILE NUMBER: MLC 10697 of 2017
| Ms Bollen |
Applicant
And
| Mr Bollen |
Respondent
REASONS FOR JUDGMENT
Introduction
The husband is currently 75 and the wife is 70. They were married in 1971 and separated in March 2017, a marriage of some 46 years. The wife commenced these proceedings in 2018. By the time the final hearing commenced the parties had agreed that their property interests, including superannuation and the husband’s pension, should be divided equally. There were however two issues about which they could not agree and which the court was required to determine. The most significant of those issues is whether or not the property at D Street, F Town in the State of Victoria (“the F Town Property”), in which the husband currently resides should be sold, the husband having the opportunity to purchase the property, or whether the husband should be permitted to retain that property as part of his entitlements. The other issue is whether or not the parties’ legal costs should be included in the asset pool and adjusted accordingly.
Background
Although theirs was a lengthy marriage much of the history of that marriage is now irrelevant for the purposes of the limited matters I must determine. On that basis, apart from some general background, I will confine myself to those parts of the evidence pertinent to the matters I must determine.
In 1983 the husband opened K Business in Melbourne and later opening the Sydney office. The husband remained working for K Business until his retirement in December 2005. As a part of his retirement package the husband receives an annual income of USD$180,000 (approximately AUD$265,000). The husband both studied and worked overseas, supported by the wife throughout his career, and was the income earner for the family. The wife was a homemaker and cared for their children.
In 2001 the parties established the Bollen Superannuation Fund. The husband and wife are both trustees and members of the self-managed superannuation fund. The fund is managed by L Company and primarily comprises investments in managed funds. The parties contributed to the self-managed superannuation fund throughout the marriage.
In 2006 the parties purchased a property at E Street Suburb G (“the Melburnian Apartment”). The Melburnian Apartment was originally owned by the Bollen Family Trust, however in 2009 it was transferred into the husband’s sole name and in 2011 it was further transferred into the joint names of the parties.
In or about 2010 the parties purchased the F Town Property, which was then vacant land, for $6.5 million. They later purchased an adjacent piece of land for $100,000. The property is registered in the joint names of the parties. The parties engaged architects and an interior designer and built a new home at a cost of approximately $6 to $7 million, a total spend of approximately $13.3 million.
After completion of the F Town Property in 2013/2014 until separation in March 2017, the parties spent time at both the Melburnian Apartment and at the F Town Property. After separation the wife continued to live in the Melburnian Apartment to the exclusion of the husband and the husband lived at the F Town Property to the exclusion of the wife. The husband also rented a small apartment in Melbourne in late October 2017. He terminated that lease in July 2019.
The Evidence
The standard of proof in this case is the balance of probabilities. Section 140 of the Evidence Act 1995 (Cth) (“the Evidence Act”) requires the Court to consider the nature of the cause of action, the nature of the subject matter and the gravity of the matters alleged when deciding whether it is so satisfied as to the requisite standard.
The wife relied on the following documents in support of her case:
·Fourth Further Amended Initiating Application filed 30 May 2019;
·Application in a Case filed 7 November 2019;
·Affidavit of wife filed 1 November 2019;
·Affidavit of wife filed 6 December 2019;
·Financial Statement of wife filed 1 November 2019.
At the commencement of the final hearing the wife sought leave to rely upon the Affidavit of Mr M filed 1 November 2019 as to the value of the Melburnian Apartment and the Affidavit of Mr N filed 1 November 2019 as to the value of the F Town Property. I granted leave to the wife to adduce the evidence of these two experts and arrangements were made for them to confer with Mr P, the single expert valuer.
The husband relied on the following documents in support of his case:
·Further Amended Response filed 5 June 2017;
·Response to Application in a Case filed 22 November 2019;
·Affidavit of husband filed 22 November 2019;
·Financial statement of husband filed 22 November 2019; and
·Affidavit of single expert witness Mr P filed 22 November 2019.
Although both the husband and wife accepted the value of the Melburnian property agreed upon by the single expert witness and the wife’s expert witness, the wife did not accept the agreed value of the F Town Property. Both the husband and wife were cross examined as were Mr P and Mr N with respect to their respective valuations and the agreement they reached after they had conferred as to the value of the F Town Property.
It was the husband’s case that the wife had not been honest with the Court when she said at paragraph [8] of her trial Affidavit as follows:
…I wanted to continue to spend time at our F Town property following separation. I proposed to spend time each fortnight at the F Town Property. However, this proposal was met by Mr Bollen saying that he would get an intervention order against me if I attended the property ultimately refusing my proposal. My lawyers wrote to Mr Bollen’s lawyer on 16 April 2019 confirming this. Now shown to me and marked with the letters “B-1” is a true copy of the letter dated 16 April 2018.
Counsel for the husband submitted that if this matter had been undefended the court would have been bound to find that the wife had been excluded from the F Town Property by an overbearing husband when in reality the very first letter sent by her solicitor to the husband made it clear that she wanted the husband to live at F Town and she would live in the Melburnian Apartment. Further that the correspondence makes it clear that the husband offered to swap properties with the wife and that she refused. His submission being that this was a reason why the Court could or should not accept the bona fides of the wife’s application for a sale of the F Town Property.
The second reason which counsel for the husband submitted should cause the court to conclude that the wife’s application for a sale of the F Town Property was not bona fide was her evidence in cross-examination, not previously identified as an issue or referred to in her Affidavit, that it would be fairer if the property were to be sold and both she and the husband were to purchase their own properties in F Town. The wife said in cross-examination as follows:
… I don’t know, um, how, um, how, how, much or how involved Mr Bollen is down at F Town, um, I don’t know, um, about the relationships with the children um, and it is all um, so I’ve been told um, the situation between the children um has completely changed and I think that um for the family to heal and for us to all be a family where we all get along together, that um we need to sell the property, for there to be a level playing field so that we both, we are both able to have a property of the similar value that we can all go down there if we want to um, at the moment, that hotel, that property down in F Town is like a hotel with two, two floors where the children can come and go, plenty of space, access to the beach, take as many friends down there as they want without any sort of interference from Mr Bollen, Mr Bollen doesn’t have to get involved um, whereas, um, I think, um, for there to be a level playing field for us all to begin our lives again that, um the property be sold whatever the value maybe and that we all heal and get over this and um the relationships and we each buy a property down there, if we want to.
Although the wife had not previously identified this as a reason for wanting the property sold and arguably should have done so, I accept, as submitted by counsel for the wife that this is not a case which turns materially on the party’s credit. I am satisfied that although the wife may want the property to be sold for other reasons she does believe that the property is worth more than the value attributed to it by her own expert witness, irrespective of whether there is a sound basis for that belief. Even if the wife should have disclosed that the value of the property was not the only reason why she was seeking a sale that does not alter the fact that it is her belief that it is worth more than not only the agreed value but also the value initially attributed to it by her own expert and that on that basis should be sold. I also agree as conceded accept by counsel for the wife that the wife’s desire to achieve a more level playing field would unlikely be sufficient to persuade the Court that it should be sold and that the question for the Court is ultimately whether it can be satisfied to the requisite degree of confidence as to the value of the F Town Property.
The husband deposed that after the F Town Property was completed, he spent time at both the Melburnian and at F Town but that since separation he has lived at F Town full time, other than on those nights which he spent at the Z Street apartment, that he is well settled there and regards the property as his home. The husband also deposed that he was involved in the design and construction of the F Town Property, is involved in the local community, is a sponsor and regular attendee at the F Town sports club, that he participates in a book and wine club in the area, he is involved with the F Town golf club and has friends in the area. He also deposed that the parties’ children and grandchildren often stay with him at the F Town Property. The wife acknowledged that the husband had valid reasons for wanting to retain the F Town Property and agreed that this was not likely to change in the foreseeable future. I accept, as submitted by counsel for the husband, that the husband has adduced evidence as to the F Town’ property’s value to him beyond its financial value and I accept that evidence.
Although it was not referred to in his trial Affidavit, the husband conceded in cross examination that he had considered the sale of the F Town Property at a time when he had health issues and was having difficulty travelling to and from F Town to Melbourne for medical appointments and at a time when he was unsure that he would be able to afford to keep the property. I accept his evidence however, in my view the fact that he may have considered the possibility of swapping residences or the sale of F Town does not alter the fact that he has been living at the F Town Property and in my view has valid reasons for now wanting to retain it.
What was unusual in this case is that the wife sought and was granted leave to adduce the evidence of her own expert witness, sought and was granted leave to cross-examine her own expert witness and thereafter put her case on the basis that the Court should not rely upon the evidence of her expert witness. Underlying this aspect of her case was her belief that the F Town Property is worth many millions more than the value placed upon it by her own expert witness. That belief was based upon what she said she had been told by a real estate agent who was not a witness in her case.
Legal Principles
Section 79(2) of the Family Law Act 1975 (“the Act”) requires the Court to be satisfied that it is just and equitable to make orders adjusting the parties’ interests in property. There are many cases in which this requirement is readily satisfied and the parties in this case each seeking orders pursuant to s79 of the Act, this is such a case. The parties have been separated since 2015 and yet some five years later they still own property together and have an ongoing financial relationship. Not surprisingly they wish to bring that financial relationship to an end and I am satisfied that it is just and equitable to make orders adjusting their property interests in order to do so.
The Court being satisfied that it is just and equitable to make property orders must make such orders as it considers appropriate. Whilst the Court has a broad discretion as the plurality in Stanford & Stanford (2012) 247 CLR 108 (at page 121) observed, citing R v Watson; Ex parte Armstrong (1976) 136 CLR 248 (at page 257) it is not an unfettered discretion and must be exercised “in accordance with legal principles, including the principles which the Act itself lays down.” Section 79(4) of the Act provides as follows:
In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
·The financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
·The contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of the last-mentioned property, whether or not that last mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
·The contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
·The effect of any proposed order upon the earning capacity of either party to the marriage; and
·The matters referred to in subsection 75(2) so far as they are relevant; and
·Any other order made under this Act affecting a party to the marriage or a child of the marriage; and
·Any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
Section 79(4)(e) of the Act is a reference to the matters in s 75(2) of the Act in so far as they are relevant to the particular case broadly speaking taking into account both the present and anticipated circumstances of the parties.
The parties in this case were married for 46 years and they have accumulated significant wealth during the marriage, contributing equally albeit in their different roles. The quantum of the asset pool in this case is large and in these circumstances where based upon their respective contributions each of the parties will retain and have the benefit of significant property it is agreed that it is not necessary for the Court to consider or make any adjustment in favour of either party having regard to the s75(2) factors.
The parties have also agreed upon the pool subject to the two issues that I must determine.
Issues in dispute
Should the Court Accept the Agreed Valuation of the Expert Witnesses
In 2017, Mr P was appointed by the husband and the wife to value both the Melburnian and the F Town Property. When he valued the F Town Property in August 2017, it was his opinion that the market value of the property was $11 million. In anticipation of a final hearing Mr P was jointly instructed by the parties to prepare an updated valuation of both the Melburnian Apartment and the F Town Property. In September 2019 he once again valued the F Town Property at $11 million.
The wife thereafter instructed Mr N of AA Pty Ltd to value the F Town Property on her behalf. In his valuation report dated 4 October 2019, he concluded that the market value of the property was $13.5 million.
As previously referred to at the commencement of the final hearing, the wife sought leave to adduce the evidence of Mr N. Although I do not accept as submitted by counsel for the wife that there was “a substantial body of opinion contrary to any opinion given by the single expert witness” as referred to in Rule 15.49 of the Family Law Rules 2004 (“the Rules”) I do accept as referred to by Thornton J in Parkes & Parkes [2015] FamCA 1210 (at [29]) “… the overarching consideration... is one of fairness and justice between the parties”. Ultimately I was satisfied that in circumstances where the expert witnesses were able to confer and it would not delay the progress of the case that justice was best served by the wife being permitted to adduce evidence from her own expert witness. However, I note that I was not aware when I permitted the wife to adduce and rely upon the evidence of her own expert that she wished to challenge that evidence and did not accept the evidence of her own expert witness.
Having granted the wife leave to adduce the evidence of Mr N, arrangements were made for Mr P and Mr N to confer and prepare a report. In that report dated 16 December 2019 they identified the following points of agreement:
·Having reviewed each other’s reports, they determined the general description of the property, including dwelling size and overall quality of the improvements were generally agreed upon.
·The experts agreed that such properties are generally tightly held and such sales of comparative properties are limited and that both reports contained the most up-to-date evidence.
·The experts agreed that the subject property views and quality of the site was considered generally inferior to the sales evidence and this was considered a negative feature of the property.
Mr P and Mr N reported that they disagreed about the price of the property at Y Street W Town and said in their joint report as follows:
…Mr P holds that the resale of [Y Street W Town] was an anomaly and the sale price was unusually high. Mr [N] has said fewer concerns about this sale and provided the following sale which occurred after both reports were completed – [another property in] Y Street W Town which sold for $19,815,000 in 2019 after 4 days on the market. Property of 2,806sqm with north facing panoramic bay views, comprising a high-quality double storey dwelling with a living area of approximately 530sqm. Features 6 bedrooms, 4 bathrooms, balance of living amenity, double garage, alfresco, in ground pool, pavilion / guest house and tennis court. This property is considered significantly superior to the subject, but underlies value / demand for prestigious properties.
Mr P and Mr N concluded that “...some movement in value from their original positions was possible” and agreed on a common figure revising their respective figures to Twelve Million and Two Hundred and Fifty Thousand Dollars ($12,250,000).
As already referred to, having sought to adduce Mr N’s evidence counsel for the wife adopted the unusual course of seeking leave to cross examine her own expert witness pursuant to s 38 of the Evidence Act 1995 (Cth) on the basis that his evidence was not favourable to the wife’s case. Although I did permit him to do so, this highlighted what I consider to be the contradictions in the way in which the wife put her case. Having sought leave to adduce Mr N’s evidence as to value, the only change in that evidence was the agreement he reached with Mr X as to value. However, whilst it is arguable that as the value agreed upon was less than Mr N’s original valuation and thus could be said to be unfavourable to the wife, the wife also did not accept Mr N’s original valuation of 13.5 million, it being her belief that the property would sell for more.
In both his oral and written submissions, counsel for the wife submitted that the valuation evidence in this case is such that any determination of value would be hazardous and uncertain. Counsel for the wife submitted that given the concessions made by the two experts, the Court could not be satisfied with the requisite degree of confidence that the figure they ultimately agreed upon is the value or just one figure in a range of values.
Counsel for the husband and the wife both referred me to the same authorities, for the most part the same paragraphs of those decisions, albeit in support of different contentions. Both relied upon the decision of the Full Court in Phillips & Phillips (2002) FLC 93-104 (“Phillips”) in which there was a dispute as to the value of the former matrimonial home which the wife wished to retain as part of her entitlements; as the husband does in this case. The husband’s valuer in Phillips valued the property at $200,000 and the wife’s valuer valued the property at $170,000. The trial judge having found in Phillips that both valuations were deficient ordered a sale of the property.
In Phillips the Full Court (commencing at [44]) considered the approach the court should take to resolve a valuation dispute as follows:
44.In The Commonwealth v Milledge (1953) 90 C.L.R. 157 the High Court at pp.161-162 said that the correct approach to be applied to the resolution of a valuation dispute should be a common sense endeavour after consideration of all material to fix a value satisfactory to the mind of the Court as representing the value.
45.As to ‘appropriate principles’ there is no fixed rule as to the proper method of valuation and the preferred methodology depends upon the facts of the case: Mallet v Mallet (1984) FLC 91-507 at p.79,121 per Mason J and Georgeson and Georgeson (1995) FLC 92-618 at p.82,218. However, the Court cannot adopt a valuation methodology that is fundamentally flawed and not applicable to the facts of the case: Elsey v Elsey (1997) FLC 92-727.
46.If there is a dispute as to the value of an asset and the Court prefers one expert to another, then reasons for the preference should be stated: Gamer and Gamer (1988) FLC 91-932 at p.76,746-76,747. Where there is a discrepancy between two or more values it is not open to the Court merely to adopt a mean or average figure between the rival opinions: Lenhan and Lenehan (supra) at 76,142. However, this does not mean that, when faced with two competing valuations, the Court is bound to accept one or the other. The Court is able to form its own separate view as to the value by the proper application of established principles of valuation. In Borriello and Borriello (1989) FLC 92-049 the Full Court, referring to the decision of the High Court in The Commonwealth v Milledge (supra), said at p.77,558:
“It is, we think, apparent that the High Court was not laying down a principle that the trial Judge was obliged to accept any particular valuer, but rather that it was necessary for him to satisfy himself by means of the application of proper principles, that he had arrived at the value of the property on the relevant date. If that value happens to be different to the values ascribed to the relevant property by the valuers called in evidence, this in itself does not affect the validity of the judge’s finding, provided that he has applied proper principles”.
47. However, in Borriello the Full Court also said at p 77,559
“We are not however to be taken as saying that we necessarily agree with the conclusion of the Full Court that the fact that the trial Judge in Lenehan’s case had taken the midpoint between the two valuations necessarily vitiated his decision. We can envisage situations where a trial Judge may be left in the position of considering that the two competing valuations represent a range and genuinely considering that the true valuation lies at or about the midpoint. Valuation is rarely such an exact science that in such circumstances a Judge could realistically conclude that the correct valuation was, for example, 55% rather than 50% less than the gap between the two valuations. In such a case it would be perfectly proper for the trial Judge to adopt a midpoint valuation. We think that a Judge, faced with a gap between two or more valuations, where the Judge considers that on the probabilities the higher or lower valuation as the case may be should be lowered or increased by some percentage to arrive at the true value, is perfectly at liberty to so adjust it as he sees fit. As we see it the vice complained of in both Milledge’s case and perceived by the Full Court in Lenehan’s case was the use of means and averages without the application of proper principles”.
48.If there is a disparity in the evidence, such that it is too difficult and complex for the Court to accept a valuation or come to a separate conclusion as to value on the application of proper principles and methodology, it may be a more proper solution for the Court to consider a sale of the property. In Little and Little (1990) FLC 92-147 the Full Court said at p.78,020:
“Whilst a trial judge should determine a disputed issue of valuation where the evidence enables him to do so, we do not accept that there is an obligation cast upon him to determine such a disputed issue irrespective of the state of the evidence. It may be such that a determination is not possible. In such a case, as in a case where there is a very considerable disparity in the valuation evidence and other evidence indicates that the actual ascertainment of the true value is difficult and complex, the proper solution as between the parties may be to order a sale.”
49.In Smith and Smith (1991) FLC 92-261 the Full Court said at 78,759:
“… where the state of the evidence makes the process of valuation hazardous or uncertain, or where there are wide differences between legitimate valuations because of a volatile market or peculiarities relating to the specific property or otherwise, the ascertainment of value by judicial process may become too uncertain and the preferable course is to order the sale of the property so that its real value can be revealed by market forces
…
The fact that each of the parties seeks a transfer of that property and neither seeks a sale is not in itself a reason for not adopting that approach: indeed it may emphasize the desirability of doing so in order to avoid the lottery effect which may be involved in choosing between one party and the other.”
Discussion
Counsel for the wife submitted that in cross examination Mr P and Mr N both said that at best the figure agreed upon falls within the range between their respective valuations; Mr N’s evidence being that he thought the value was somewhat higher than the agreed figure but a bit less than the figure in his report and Mr P saying that there was a range and it was his opinion that $12.25 was the upper end of that range and $11 million, although somewhat conservative, was the lower end of that range. He also referred me to Mr P’ evidence, when it was put to him that that there is $1.25 million between his valuation and the agreed figure that “it is difficult to say where in that range is the true value”.
In my view, it is helpful to look at Mr P response in the context of his other evidence including the following (at pages 5-7 of the transcript dated 17.12.19):
So 11 million and 12.25 million are both right?---It’s within the range of what is reasonable. I think it is 11 per cent variation.
HER HONOUR: Sorry. I can’t hear you? ---It’s – it’s within the range of 11 per cent for change in the value
MR NORTH: So they’re both correct? There is a wide range that property values [in the area] can fall into. I mean, I probably erred on the side of caution with $11 million. I think the sale at [Y Street] that was resold after a couple of years shows there can be a wide variation in sale prices.
So 13.5 is within the range as well?‑‑‑No. I don't – no. I didn’t agree to that.
Right. Well, how far beyond 12.25 does the range extend?‑‑‑My feeling was as a bare minimum that that property falls within the 11 to two – 11 to 12 million dollar range, not 13 or 14.
All right. As a bare minimum?‑‑‑Well ‑ ‑ ‑
What do you mean?‑‑‑No. I – I said $11 million was the bottom of the range.
Right?‑‑‑Generally, with the valuations, there – there is a window that properties will fall within.
Right?‑‑‑Particularly these type of high end properties.
They’re difficult to value, aren’t they?‑‑‑That's correct.
Yes. And there’s a limited number of relevant or comparable sales?‑‑‑That's correct.
And, indeed, the degree to which they’re comparable is often not that great?‑‑‑That's right. It’s – it’s a highly variable area. There are no usually very similar properties that are sold, and that makes it difficult.
Yes. So there are ‑ ‑ ‑?‑‑‑As ‑ ‑ ‑
There are few sales of properties that are not particularly comparable to each other?‑‑‑They’re highly variable, and a change in the views, land areas, water access, it means – yes – they are highly variable in nature. And it’s not a generic area where properties are very similar to one another.
Yes. So you don't have a high volume of sales or relatively homogenous properties?‑‑‑That's correct.
So it makes the whole process one that you can’t have as much confidence in the outcome as where there are properties – there is a high volume of homogenous sales?‑‑‑Yes. It is a judgment call by the valuer.
For his part Mr N when asked by counsel for the wife if his valuation of $13.5 million had been wrong said (at line 12 page 17) that he did not think his valuation had been wrong but that that “the valuation is open to opinion based on the broad nature of sales in that area.” He went on to say as follows:
…Well, there would –there probably is a range that would appeal to the market, and to the right buyer, you would know, they would probably pay, you know, a higher figure that someone else. It’s—if that what your suggesting, I would agree with something along those lines.
There is in my view some force in counsel for the husband’s submission that it is not surprising that the two valuers reached a different conclusion and that it does not mean that either of those valuations is wrong or it follows that the agreed value is wrong. There have been many reported decisions both in this and other courts which have considered this issue. As noted by the Full Court of the Supreme Court of Victoria in Karenlee Nominees Pty Ltd v Gollin & Co Ltd [1983] 1 VR 657 at 669:
…The valuation of land and buildings involves a matter of judgement. Opinions notoriously vary on this subject matter- it would be surprising to find two valuers who agree on the valuation to be given to land and buildings of the nature of the subject premises. There is no scientific exactitude in the valuation of land and buildings. They are as hypothetical as the hypothetical purchase whom they assume.
Although this decision of the Full Court of the Supreme Court was overturned by the High Court (Gollin & Co Ltd v Karenlee Nominees Pty Ltd (1983) 153 CLR 455) this issue was not the subject of that appeal.
In the recent decision of Salmon and Ors & Salmon [2020] FamCAFC 134 albeit the question on appeal was the primary judge’s discretion to allow a party to tender a report or adduce evidence from an expert witness other than the single expert, the Full Court referred to the decision of Applegarth J in Conias Hotels Pty Ltd v Murphy & Anor [2012] QSC 297 (“Conias”). Although Conias also dealt with the exercise of the discretion to permit a party to adduce evidence from an expert other than the jointly appointed expert Applegarth J said (at [5]) as follows:
[5]It almost may be taken for granted that experts adopting the same methodology applied to the same facts and applying the same assumptions might come to different opinions, simply as a matter of professional judgment. On valuation issues, the mere fact that different experts come to different opinions simply identifies that, in many cases, there is a range of opinion within which the actual value of real property, a business or other thing can be legitimately arrived at.
This is consistent with the evidence of Mr P that generally “…there is a window that properties will fall within.”
In support of his submission that the Court could not have any confidence in the figure agreed upon by Mr P and Mr N, other than that it falls within a range, counsel for the wife referred to the evidence of both experts with respect to the unique nature of the properties and the limited number of comparable sales compared to other residential properties in the retail property market and that unlike other properties price per square metre is not a good indicator of value.
Counsel for the wife concluded that in all of the circumstances having applied the comparable sales methodology the two valuers had an “imperfect tool” and that the Court should view the figure arrived at with a “heightened degree of circumspection” and more particularly so given the substantial difference between the two valuations. Whilst I accept that $2.5 million difference between their two valuations is in dollar terms substantial the value of the property is itself substantial. The figure upon which the two expert witnesses now agree is approximately 13 per cent more than Mr X’s valuation and approximately 8 per cent less than Mr N’s valuation. Although counsel for the wife submitted that the difference between the two valuations in Phillips was only $30,000 the difference in percentage terms was approximately 20 per cent. Where the property is valuable as in this case any difference in dollar terms is likely to be large. In my view the difference between the figures in Phillips and in this case and the difference between the valuations of the two expert witnesses in this case in dollar terms is not a particularly helpful comparison.
In any event in this case, unlike in Phillips, the experts have been able to agree upon a value and if the Court concludes that it can have confidence in their evidence, there is no difference.
In my view counsel for the wife’s submissions with respect to this issue highlight the contradictions in the wife’s case. In reality the wife’s complaint is not the difference between the valuations of the two experts or the agreed value and their respective valuations because although the wife sought to adduce the evidence of her own expert she does not accept that evidence and even if the Court were to accept the evidence of her expert, it is her case that the property should be sold. In these circumstances the difference is between the agreed figure and what the wife believes the property might achieve if it is sold. As previously referred to the wife believes based upon a discussion or discussions with the agent she says should be engaged to sell the F Town Property, that the property is worth in excess of $16 million and it was initially her case that it should be put on the market for sale with a reserve of that amount. Even if her belief as to the value is a genuine one there is no evidence to support her belief and as counsel for the wife acknowledged it is a difficult argument to sustain in these circumstances and arguably particularly so if for example the Court were to conclude that the value of the property is $13.5 million.
Counsel for the wife was critical of both the substantial difference between the two valuations and the basis upon which the experts reached an agreed figure, in particular having regard to that difference. With respect to the difference between their two valuations it is significant in my view that the focus of counsel for the wife’s cross-examination of them both was the difficulty associated with valuing this particular property, rather than a challenge to their expertise generally.
Although Mr P acknowledged the difficulties associated with valuing the F Town Property, given the uniqueness of that property and the limited comparable sales, and that he and Mr N disagreed about whether Y Street W Town which sold in 2018 for $13,803,750 was an anomaly, they both agreed that Y Street:
·Had the advantage of being in W Town rather than F Town;;
·Had a better view than the F Town Property;
·Unlike the F Town Property had direct beach access;
·Unlike the F Town Property did not have a public pathway; and
·Was a more regular shape than the F Town Property.
Mr N whilst also agreeing that it was more difficult to value the F Town Property than a more generic property where there are more comparable sales also said, after being cross-examined in relation to these five features referred to by counsel for the husband, that Y Street was superior to the F Town Property.
Significantly in my view although both Mr P and Mr N agreed that it might be more difficult to value a unique property like the F Town Property given the limited number of comparable sales, neither of them said that they were not comfortable with or could not value the property. In Bingham v Cumberland County Council (1954) 20 LGR 1 at pages 18-19 Sugerman J stated as follows:
…In the absence of sufficient guidance to be had from sales, the valuer may find himself in a position resembling that to which Lord Romer referred to in Raja Vyricherla Narayana Gajapatiraju v Revnue Divisional Officer Vizagapatam [1939] AC 302 at 312-313 in which he ‘will have no market value to guide him, and he will have to ascertain as best he may from the materials before him what a willing vendor might reasonably expect to obtain from a willing purchaser for the land…The valuer, in arriving at his opinion in these difficult matters may have to draw upon his general knowledge and experience, including perhaps experience in other situations which, although lacking in complete comparability, may yet provide an experienced valuer with guidance and suggestions as to the general approach which may be had and as to considerations which may become relevant.
Graham L Fricke in his book ‘Compulsory Acquisition of Land in Australia (The Law Book Company Limited, 1st edition, 1986) (referenced by Alan Hyman in his book The Law Affecting Valuation of Land in Australia (The Federation Press, 5th edition, 2014) at page 108) stated (at page 344):
…There are times when no comparable evidence or even near-comparable evidence is available. It is in such instances that the valuer must draw from his experience and knowledge whilst he should never be an advocate in making his valuation, he may in these circumstances need to become one to sustain it.
I accept as submitted by counsel for the wife that it is not simply the fact that the experts have agreed upon a value that is determinative, but rather that based upon their evidence and how they arrive at that agreed value the Court can be satisfied as to the value. Ultimately whether the Court accepts the agreed value depends upon whether I accept their expertise, although that is not in question in this case, and accept their evidence with respect to the valuation exercise they have undertaken. Generally speaking both Mr P and Mr N were good witnesses. Their evidence was cogent and considered and they each made concessions when in my view it was appropriate to do so, both with respect to the difficulties of the valuation exercise in this case and the basis upon which they had reached an agreed figure. In so far as counsel for the wife was critical of the process and the figure agreed upon by them in conference, I am satisfied having heard their evidence, that they had each considered the others views and opinions and agreed upon a figure having regard to the other’s opinion and the basis upon which they had each formed their opinions.
In my view, it is not that surprising that Mr P and Mr N formed different opinions as to the value of the F Town Property or that having had the opportunity to confer and consider their respective valuations and the basis of those valuations that they were able to agree upon a figure. In my view, it would have been more surprising if their valuations had been the same or if, as submitted by counsel for the wife, one or other of them had refused to consider the others point of view. That they did so does not make the decision I have to make more “hazardous or uncertain”. In all of the circumstances, I am satisfied that the value of the property, as agreed upon by Mr P and Mr N, is $12,250,000.
Should The Property Be Sold
Counsel for the wife submitted that even if the Court were to be satisfied as to the value of the F Town Property that in any event to achieve a just and equitable outcome the F Town Property should be sold. The basis of the wife’s case both as to the Court’s ability to ascertain the value of the property and the justice and equity of the orders she proposed being her belief that the property is not only worth more than the valuation agreed upon by the single expert witness and her own expert witness but also more than the valuation prepared by her own expert witness. As previously referred to the wife also said that she wanted the F Town Property sold so that she and the husband would have a level playing field with respect to owning a property at F Town.
Counsel for the wife further submitted that even if the Court were to be satisfied as to the value of the F Town Property, that it “…can order a sale confident that if the property achieves a price greater than the valuation, the husband has the capacity to retain it” and would not be deprived of the opportunity to retain the property. This in my view does not alter the fact that the reason for the sale would be the wife’s belief that it is worth more and that even if the wife’s belief is genuine there is no evidentiary basis for that belief.
I am satisfied that the husband has lived at the F Town Property since separation, save for those nights when he stayed in the rented apartment and is settled in the property. It is his home. The wife for her part will by agreement retain the Melburnian Apartment that she and the husband lived in during the marriage. That is her home.
I accept as submitted by counsel for the wife that if the property were to sell for a figure higher than I have found its value to be, the husband has some capacity to purchase it at auction or if unable to do so would have the benefit of the increased value. However this in my view ignores the fact that it is his home.
The court must weigh up the justice and equity of the orders proposed as between both the husband and the wife. There would be many cases in which a party has a belief that a property might sell for more than its value. That in my view does not mean that it must be sold to achieve a just and equitable outcome. Nor in my view does the fact that it is a valuable mean that a property should be sold.
I not satisfied that justice and equity requires the F Town Property to be sold. To the contrary I am satisfied that it would not be just and equitable to require the husband to face the prospect of the sale of his home based upon the wife’s belief that the property is worth more than the value agreed by her own expert witness and the single expert witness and which I have found to be the value of the property.
In these circumstances I propose to accede to the husband’s application that he retain the F Town Property in exchange for making a cash payment to the wife.
Legal Fees.
Significantly in this case both parties have paid their costs from their joint account. The parties have also continued to use this joint account to meet their personal expenditure.
It is the wife’s case that in order to ensure an equal division of their property as agreed that the legal fees that they have each paid should be added back to the asset pool as a notional asset.
Although the parties both provided costs letters on the first day of the final hearing as ordered reference was made to other figures during the hearing and accordingly the matter was listed for mention on 16 July 2020 for clarification of the figures. The parties having clarified those figures I am satisfied that the amounts expended by them on their legal fees from their joint account were as follows:
·Husband: $491,850
·Wife: $246,620
In addition to the figure of $491,850 the husband also paid $5043 to Lander & Rogers on account of legal fees incurred by the parties’ son Mr S in these proceedings and paid Mr S $30,000 towards his costs. It is the wife’s case that these sums should be added to the amount the husband has paid out of the joint account making a total on the husband’s part of $526,893.
The Full Court in Trevi & Trevi [2018] FLC 93-858 referring to the decision of the Full Court in Chorn and Hopkins [2004] FLC 93-204 said at ([56] – [58]):
56. In my respectful view, her Honour’s reasons evidence a confusion between two different approaches to the question of money expended on legal fees from property that would otherwise form part of the existing interests in property available for division between the parties.
57.That confusion might be expressed as her Honour undertaking what should occur at “stage one” rather than “stage three” of the often-cited “four-step process” involved in s 79 proceedings. The failure to comply with the so-called four step process is not a legal requirement which results, of itself, in error. However, error arises in my view because different discretions, informed by different considerations, are involved in the different approaches dealing with paid legal fees.
58.The application of a discretion in deciding whether to follow a guideline in adding back the value of paid legal fees to the value of existing interests in property, involves a different discretionary task to the consideration of the same as but part of an overall assessment of all relevant s 75(2) factors. In a particular case, considerations relevant to the discretion to apply or not apply an established guideline may overlap with, or also be relevant to, considerations relevant to the s 75(2) discretionary task, but reasons must make clear that a separate discretion is being exercised and how identified matters are considered to be relevant to either or both.
Counsel for the husband submitted that in this case there had been a high level of discretionary expenditure, particularly on the part of the wife. In particular he referred to the cost of the wife’s consultations with Dr W and her travel expenses. Although counsel for the husband conceded that the wife was entitled to spend money on discretionary expenditure, it was his case that the husband was similarly entitled to spend money on a discretionary basis characterising the husband’s spending on legal fees as discretionary expenditure.
I accept counsel for the wife’s submission (at [26] – [27] of the Outline of Case document filed on behalf of the wife on 12 December 2019) that:
26. The wife seeks that both parties’ legal fees be added-back to the pool in order to achieve a true equal division of the parties’ property. This is in circumstances where the husband has spent significantly more than the wife on legal fees, including paying for Mr S’s legal fees. In June 2019, the husband had spent approximately $330,000 on legal fees whereas the wife had spent $110,000 on legal fees. Updated figures will be obtained pursuant to the costs letters to be provided on the first day of the final hearing.
27.The husband opposes any add-back for legal fees. His position seems to be that if there is to be an add-back for legal fees, there should also be an add-back for the funds spent by the wife post-separation on travel and medical treatment. The husband’s position fails to consider the special nature of legal fees as an add-back. In the circumstances of the parties’ financial circumstances, the wife’s expenditure on travel and medical expenses is entirely reasonable and ought not to be added-back.
Counsel for the husband submitted that the Court should not exercise its discretion in favour of adding back the legal fees given the wealth of these parties and that to do so given a pool of some $32 million would be “nit-picking”. In my view the course counsel for the husband urges upon the Court involves that very nit-picking of which he complains. I am not in a position nor in my view should I be required to analyse the personal expenditure of these parties and make findings as to the reasonableness of that expenditure. In my view legal costs are in a different category and should not be simply weighed up against other personal expenditure. I am also satisfied that the amounts the husband paid to or on account of Mr S’s legal costs should be included in the figure the husband has paid. In all of the circumstances I propose to add back the $246,620 spent by the wife on her legal fees and the $526,893 spent by the husband on his fees and for or on behalf of Mr S.
The Property To Be Divided
Having determined the values of the F Town Property and acceded to the wife’s application with respect to the parties legal fees, the pool is as follows::
Non-Superannuation Assets
Owner
Value
Comments
1
The Melburnian, E Street Suburb G
Joint
$4,150,000
2
D Street, F Town
Joint
$12,250,000
3
Motor Vehicle 1
Husband
$55,000
4
Motor Vehicle 2
Wife
$28,000
5
Furniture and household contents at The Melburnian
Joint
$80,385
6
Furniture and household contents at the F Town Property
Joint
$92,340
7
Wine collection at F Town Property
Joint
$36,000
8
Bollen Family Trust
T P/L
NIL
9
Bollen Family Trust No 2
T P/L
NIL
10
Joint NAB bank account, account number …88
Joint
$379,793
Husband’s figure of $368,766 as per statement of 24 October 2019. The wife’s figure of $379,793 as per statement of 12 December 2019. Wife’s figure used for the purposes of calculating the pool.
11
Westpac Bank account number ...90 (Cheque Account)
Wife
$15,000
12
Cash
Wife
$5,000
No
Loans
Owner
Value
Comments
13
Loans to Ms R
Joint
$1,005,000
Pursuant to Loan Agreement dated 30 October 2015
14
Loans to Mr S
Joint
$2,238,000
Pursuant to Loan Agreement dated 16 October 2015
15
Loans to S Pty Ltd
Joint
$77,121
Pursuant to Loan Agreement dated 19 September 2016
16
Loans to Ms R
Wife
$6000
Funds loaned by wife post-separation
17
Loans to Ms R
Husband
$29,871
Funds loaned by husband post-separation
18
Funds loaned to
Mr S
Husband
$50,000
Funds loaned by husband post-separation
19
Loan to brother
Mr T
Husband
$1,100
Funds loaned by husband post-separation
20
Loan to Mr Q
Husband
$16,000
Funds loaned by husband post-separation
No
Add Backs : Legal Fees
Owner
Value
Comments
21
Legal Fees
Husband
$526,893
Includes contribution to Mr S’s legal fees.
22
Legal Fees
Wife
$246,620
No
Superannuation assets
Owner
Value
Comments
23
Bollen Superannuation Fund
Joint
$13,140,399
Husband’s figure as at 30 June 2019
Net assets including superannuation
$34,428,479
The Effect Of The Orders
The parties having agreed to an equal division of their property. They have further agreed to the following:
·That they will be entitled to one half of all repayments received by way of principal and interest of the loans to their son pursuant to the Loan Agreement dated 16 October 2015, the loan to their daughter pursuant to the Loan Agreement dated 30 October 2015 and the wife’s loan to S Pty Ltd pursuant to the Loan Agreement dated 16 September 2016;
·That they will share equally any liability for income tax on any interest paid with respect to those loans,
·An equal split of their respective superannuation entitlements;
·That the husband retain various entities to the exclusion of the wife and indemnify her with respect to any liability with respect to those entities,
·That the husband be entitled to the contents of the F Town Property; and
·The wife be entitled to the contents of the Melburnian.
The parties have also consented to orders which provided for the equal division of the balance of their National Australia Bank (“NAB”) joint account.
Having reached agreement in relation to those above matters the total pool of assets, including the legal fees, available for division, but excluding the loans referred to and the superannuation is $17,588,209 The pool is as follows:
Non-Superannuation Assets
Owner
Value
1
The Melburnian, E Street Suburb G
Joint
$4,150,000
2
D Street, F Town
Joint
$12,250,000
3
Motor Vehicle 1
Husband
$55,000
4
Motor Vehicle 2
Wife
$28,000
5
Furniture and household contents at The Melburnian
Joint
$80,385
6
Furniture and household contents at the F Town Property
Joint
$92,340
7
Wine collection at F Town Property
Joint
$36,000
8
Bollen Family Trust
T P/L
NIL
9
Bollen Family Trust No 2
T P/L
NIL
10
Westpac Bank account number ...90 (Cheque Account)
Wife
$15,000
11
Cash
Wife
$5,000
No
Loans
Owner
Value
12
Loan to Ms R
Wife
$6,000
13
Loan to Ms R
Husband
$29,871
14
Loan to Mr S
Husband
$50,000
15
Loan to brother Mr T
Husband
$1,100
16
Loan to Mr Q
Husband
$16,000
No
Legal Fees
Owner
Value
17
Legal Fees
Husband
$526,893
18
Legal Fees
Wife
$246,620
Net assets
$17,588,209
Based upon an equal division the parties are each entitled to $8,794,104. On the basis of the husband retaining the F Town Property he will have or have had the benefit of assets to the value of $13,033,333 and will need to pay the wife $4,239,228.50. I propose to make orders in those terms.
The husband relied upon the minute of orders set out in his Outline of Case whereas counsel for the wife filed an updated minute of the orders at the commencement of his final address. Although they were in substantial agreement in relation to many aspects of the case there were some differences in the form of the orders they each sought and I have adopted parts of each of those minutes of orders. However I also propose to give the parties the opportunity to make submissions with respect to the form of the orders before pronouncing the orders and will list the matter for mention for the purpose. If neither party has any issues with respect to the form of the proposed orders the mention date can be vacated. The orders I propose are as follows:
(1)On or before (60 days) (“the due date”) the husband pay to the wife the sum of $4,239,228.50 (“the payment”)
(2)Contemporaneously with the payment:
(a)The husband do all acts and things and sign all documents necessary to transfer to the wife (at her expense) all of his right title and interest in the property known as and situate at E Street, Suburb G in the State of Victoria being the property more particularly described in certificate of Title Volume … Folio … (“the Melburnian”); and
(b)The wife do all things and sign all documents required to discharge the mortgage registered … secured by the Melburnian property so as to release the husband from any liability and the wife shall be liable for any associated expense; and
(c)The wife do all acts and things and sign all documents necessary to transfer to the husband (at his expense) all of her right title and interest in the property known as and situate at D Street, F Town in the State of Victoria being the property more particularly described in Certificate of Title Volume … Folio … (“the F Town Property”); and
(d)The husband do all things and sign all documents required to discharge the mortgage to National Australia Bank registered … secured by the F Town Property so as to release the wife from any liability and close the associated loan account in the wife’s name and the husband shall be liable for any associated expense.
(3)Pending the transfer of the Melburnian:
(a)The wife have the sole use and occupation of the Melburnian;
(b)The wife pay for all expenses in relation to the Melburnian;
(c)The parties be restrained by injunction from encumbering or further encumbering the Melburnian; and
(d)The parties hold their interests in the Melburnian on trust pursuant to the terms of these orders.
(4)Pending the transfer of the F Town Property:
(a)The husband have sole use and occupation of the F Town Property;
(b)The husband pay for all expenses in relation to the F Town Property;
(c)The parties be restrained by injunction from encumbering or further encumbering the F Town Property save and except for the purposes of giving effect to these orders; and
(d)The parties hold their interests in the F Town Property on trust pursuant to the terms of these orders.
(5)In default of the payment by the due date the F Town Property be forthwith sold on the following terms:
(a)That the parties forthwith do all acts and sign all documents necessary to jointly appoint a real estate agent to sell the property and failing agreement the wife provide the husband with a list of three real estate agents together with the details of their commission and any other charges and no more than 7 days after receipt of the wife’s list the husband nominate one an agent from the wife’s list;
(b)The parties follow the reasonable recommendations of the selling agent as to the terms and conditions of the sale and failing agreement between the parties in writing as to the terms and conditions of the sale, the selling agents recommendations are to be acted upon by the parties with liberty to apply in relation to same;
(c)The parties jointly appoint a conveyancer to act in the sale and failing agreement the wife provide the husband with a list of three conveyancers together with details of their fees and no more than 7 days after receipt of the list from the wife, the husband nominate one conveyancer from the wife’s list;
(d)The parties follow the reasonable recommendations of the selling agent as to the preparation and presentation of the property for sale, with the costs of preparing and presenting the property for sale to be paid equally by the parties.
(6)In the event of the sale of the F Town Property, the sale proceeds be applied as follows
(a)Firstly, to pay all costs commissions and expenses of the sale including conveyancing costs;
(b)Secondly to discharge any liability secured against the title of the F Town Property;
(c)Thirdly to pay to the wife so much of the Payment as is then outstanding together with interest thereon at the rate prescribed by the Family Law Rules 2004 (Cth);
(d)Finally the balance of the sale proceeds to be paid to the husband.
(7)The parties shall each be entitled to one half of any and all payments received in repayment or partial repayment (including by way of principal and/or interest) of the following loans (collectively “the loans”) and the parties shall share equally in liability for income tax assessed on any interest which may be paid on the loans:
(a)The loan from the parties to Mr S pursuant to the Loan Agreement dated 16 October 2015;
(b)The loan from the parties to Ms R pursuant to the Loan Agreement dated 30 October 2015; and
(c)The loan from the wife to S Pty Ltd pursuant to the Loan Agreement dated 19 September 2016
(8)To ensure compliance with Order 7:
(a)The parties shall each notify the other in writing within 48 hours of receipt by either of them of any monies paid in repayment or partial repayment of the Loans; and
(b)If a repayment or part repayment is not made equally to the parties, the party in receipt of the repayment/payment pay half of the funds received by them to the other party within seven days of the first mentioned party receiving the funds.
(9)Within seven days of the date of these orders:
(a)The wife do all acts and things and sign all documents necessary to assign to the husband all of her right, title and interest in the monies owed to her by S Pty Ltd pursuant to the Loan Agreement dated 19 September 2016;
(c)The wife do all acts and things and sign all documents necessary to assign to the husband all of her right, title and interest in the monies owed to her by Mr S pursuant to the Loan Agreement dated 16 October 2015 secured by mortgage number …; and
(d)The husband do all acts and things and sign all documents necessary to assign to the wife all of his right, title and interest in the monies owed to him by Ms R pursuant to the Loan Agreement dated 30 October 2015.
(10)Within 30 days of the date of these orders, the wife establish her own self-managed superannuation fund (“Wife's SMSF”) and upon doing so she forthwith inform the husband of the name of the fund and the trustee.
(11)Within 60 days of the date of these orders, the parties do all acts and things and sign all documents necessary to:
(a)Equalise their respective entitlements in the Bollen Superannuation Fund (“the Fund”); and
(b)Transfer the wife's equal entitlement in the Fund to the Wife's SMSF such actions to be undertaken pursuant to orders 12 to 18.
(12)Pursuant to section 90XT (1)(a) of the Family Law Act, whenever a splittable payment becomes payable in respect of the husband's interest in the Fund, the wife shall be entitled to be paid an amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001 using the base amount of "X" (Wife's Superannuation Split) and there be a corresponding reduction in the entitlement of the husband in the Fund.
(13)For the purpose of order 12, X equals 50% of the combined total value of the Fund as at the operative time, less the wife's member balance in the Fund (the “wife's entitlement”) as at the operative time.
(14)Order 12 has effect from the operative time, being four days after the trustees of the Fund are served with a copy of these orders (noting that the husband and wife are the trustees of the Fund).
(15)Following the Wife's Superannuation Split, the parties do all things necessary, including but not limited to exercising their entitlements to request (pursuant to Regulation 7A.06(2) of the Superannuation Industry (Supervision) Regulations 1994), to effect the rollover or transfer of the wife's interest in the Fund including the Wife's Superannuation Split and the wife's entitlement to the Wife's SMSF in accordance with Regulation 7A.12 of the Superannuation Industry (Supervision) Regulations 1994.
(16)The parties jointly instruct their existing advisors with L Company to advise as to the composition of the Wife's Entitlement and follow the reasonable recommendations of L Company in that regard.
(17)Pending the transfer or rolling over of the Wife's Entitlement into the Wife's SMSF or the wife executing a waiver of rights within the meaning of section 90XZA of the Act in relation to the Wife's Entitlement:
(a)The husband is hereby restrained by himself, his servants or agents from executing a death benefit nomination in favour of any person or doing any other act or thing which would render any part of his interest in the Fund a non-splittable payment within the meaning of Regulation 12 or 13 of the Family Law (Superannuation) Regulations 2001 such as would defeat the Wife's Entitlement pursuant to these orders;
(b)The parties by themselves, their servants and/or agents be and are hereby restrained from doing any act or thing which would prevent the other party (their heirs, executors, administrators or nominees) from receiving the benefits in the Fund to which they are entitled pursuant to these orders; and
(c)The parties sign all documents as may be required of them as trustees of the Fund to keep the Fund in proper account including but not limited to signing financial statements and taxation returns.
(18)Following the wife transferring or rolling over the wife’s entitlement into the wife’s SMSF:
(a)The Wife forthwith do all such acts and things and sign all documents necessary to:
(i)Resign as a member of the fund; and
(ii)Resign as a Trustee of the Fund; and
(b)The husband retain the Fund to the exclusion of the wife; and
(c)The husband be liable for and indemnify the wife in relation to any liability of whatsoever nature in the name of the fund whether past, present or future.
(19)The husband retain to the exclusion of the wife the following entities (“the Husband’s Entities”):
(a)T Pty Ltd;
(b)V Pty Ltd;
(c)Bollen Family Trust; and
(d)Bollen Family Trust (No 2).
(20)Within 30 days of the date of these orders, the wife do all such acts and things and sign all documents requested by the husband at the expense of the husband:
(a)Transfer any shareholding she has in any of the Husband's Entities to the husband;
(b)Resign any officeholding she has in any of the Husband's Entities in favour of the husband;
(c)Resign from any position which she may hold in the Bollen Family Trust or the Bollen Family Trust (No 2); and
(d)Relinquish any entitlement of whatsoever nature she has in any of the Husband's Entities in favour of the husband, including but not limited to assigning any credit or debit loan account in any of the entities to the husband.
(21)The husband be liable for and indemnify the wife in relation to any liability of whatsoever nature (past, present or future):
(a)In the name of any of the Husband's Entities; or
(b)In the name of the wife arising from her involvement in any of the Husband's Entities.
(22)Unless otherwise specified in these orders and save for the purposes of enforcing the payment of any monies due under these orders:
(a)Each party is solely entitled to the exclusion of the other to all property (including choses-in-action) in the ownership or possession of such party as at the date of these orders and for the purpose of this order:
(i)The items in The Melburnian are deemed to be in the possession of the wife; and
(ii)The items in the F Town Property are deemed to be in the possession of the husband;
(b)Monies standing to the credit of the party in any bank accounts in that party's name are to be retained by the party whose name the account is held;
(c)Each party is solely liable for and indemnifies and keeps indemnified the other against all liabilities in their respective names or encumbering any item of property to which that party is entitled pursuant to these orders;
(d)Each party foregoes any claims they may have to any superannuation or work-related benefits or entitlements belonging to or earned by the other;
(e)Insurance policies remain the sole property of the owner named in the policy; and
(f)Any joint tenancy in any real or personal estate is hereby expressly severed and the parties hold their interest in such property pursuant to the terms of these orders.
I certify that the preceding seventy-three (73) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered on Thursday 23 July 2020.
Associate:
Date: 23 July 2020
2
8
3