Borja & Charmchi
[2024] FedCFamC1F 553
•21 August 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Borja & Charmchi [2024] FedCFamC1F 553
File number: SYC 4865 of 2021 Judgment of: CAMPTON J Date of judgment: 21 August 2024 Catchwords: FAMILY LAW – PROPERTY – Property adjustment pursuant to s 79 of the Family Law Act 1975 (Cth) – Where the s 79 proceedings were transferred from Division 2 on the second day of trial in that forum – Where the assessment as to complexity and volume grounding the transfer was inaccurate – Where a proceeding requires active case management and critical evaluation prior to transfer – Where the discretion to transfer to another court ought to be exercised cautiously – Consideration of the value of the wife and the husband’s property available for adjustment, contributions, and any adjustments to the contributions – Where the wife makes a Kennon v Kennon (1997) FLC 92-757 contention that her contributions were made more onerous and arduous – Where the wife establishes that contention, but the weight to be given to it is slight – Orders made adjusting the property of the parties 60 per cent to the wife and 40 per cent to the husband. Legislation: Evidence Act 1995 (Cth) s 140
Family Law Act 1975 (Cth) ss 75, 79, 117
Federal Circuit and Family Court of Australia Act 2021 (Cth)
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) ch 7
Cases cited: Boulton & Boulton (No 3) [2024] FedCFamC1F 269
Browne v Green (1999) FLC 92-873; [1999] FamCA 1483
Franklin & Ennis [2019] FamCAFC 91
Hall v Hall (2016) 257 CLR 490; [2016] HCA 23
Horrigan & Horrigan [2020] FamCAFC 25
Kennon v Kennon (1997) FLC 92-757; [1997] FamCA 27
Kowaliw and Kowaliw (1981) FLC 91-092; [1981] FamCA 70
Pierce & Pierce (1999) FLC 92-844; [1998] FamCA 74
Robb & Robb (1995) FLC 92-555; [1994] FamCA 136
Stanford & Stanford (2012) 247 CLR 108; [2012] HCA 52
Trevi & Trevi (2018) FLC 93-858; [2018] FamCAFC 173
Vetter v Lake Macquarie City Council (2001) 202 CLR 439; [2001] HCA 12
Division: Division 1 First Instance Number of paragraphs: 161 Date of hearing: 12-15 August 2024 Place: Sydney Counsel for the Applicant: Mr Friedlander Solicitor for the Applicant: Koutzoumis Lawyers Counsel for the Respondent: Mr Battley Solicitor for the Respondent: Team Legal Group ORDERS
SYC 4865 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS BORJA
Applicant
AND: MR CHARMCHI
Respondent
ORDER MADE BY:
CAMPTON J
DATE OF ORDER:
21 AUGUST 2024
THE COURT ORDERS THAT:
1.Within three months from the date of these orders the wife pay to the husband the sum of $111,000.
2.Simultaneously upon the wife’s compliance with Order 1, the husband do all such things as are necessary to transfer to the wife all of his right, entitlement and interest in the property situated at 1 B Street, Suburb C New South Wales (“the 1 B Street property”) and the wife thereafter be responsible for and pay the mortgage secured upon the said property and all other charges upon the said property, including but not limited to land tax, land rates, and water rates, and indemnify the husband in relation to the same.
3.In the event the wife fails or neglects to comply with Order 1 hereof, the parties shall forthwith upon such failure or neglect do all such things and sign all such documents to list for sale the 1 B Street property on the following terms:
(a)To list for auction with an agent agreed upon by the parties in writing within fourteen days and failing agreement the agent be appointed by the President of the Real Estate Institute of New South Wales or his or her nominee;
(b)Issue a notice to vacate to the tenants to vacate the property;
(c)Give such instructions to a solicitor to act on the sale of the property agreed upon in writing within fourteen days, and failing agreement as to the identity of the solicitor, the solicitor be appointed by the President of the Law Society of New South Wales or his or her nominee;
(d)Market the 1 B Street property for sale by public auctions to be held on-site within six weeks of the tenants vacating the property at a reserve price to be agreed by the parties in writing and failing agreement at a reserve price seven days prior to the auction, at such reserve price as determined by the single real property valuation expert Mr D;
(e)Attend the auction and in the event that the reserve price set for the auction is not reached negotiate with the highest and second highest bidder and accept any offer to purchase that is the highest made within 5 per cent of the reserve price set for that auction unless the parties otherwise agree in writing;
(f)Execute the contract for sale and in the event that the parties fail to agree on the terms of the contract for sale, the terms recommended by the solicitor acting on the sale shall be adopted.
4.Upon the completion of the sale of the 1 B Street property, the proceeds shall be applied in the following priority:
(a)In payment of an amount sufficient to discharge the mortgage secured over the property;
(b)In payment of any outstanding land tax, council rates, and water rates;
(c)In payment of fees for the nomination of an agent or solicitor pursuant to these orders, if any;
(d)In payment of Mr D’s fees, if any;
(e)In payment of the real estate agent’s commission, selling expenses and auction expenses incurred on the sale;
(f)In payment of conveyancing legal costs associated with the sale;
(g)In of the amount of 10.7 per cent of the remaining balance to the husband; and then
(h)In payment of the balance to the wife.
5.Save and except as provided for by these orders each party shall retain to the exclusion of the other all cash at bank, real property, furniture, motor vehicles, personalty, shareholdings, and superannuation entitlements in their respective possession or control as at the date of these orders.
6.In the event the either party fails or neglects to execute any document to give effect to these orders then a registrar of this Court be appointed to forthwith upon such failure or neglect to execute on behalf of the party in default such documents as prepared by the other for the purposes of implementation of these orders upon being satisfied of such failure or neglect by way of affidavit evidence.
7.Save as to costs, all outstanding Applications and Responses are otherwise dismissed.
8.Should any party wish to make an application for costs of or incidental to these proceedings, they are to file and serve within 28 days of the date of these orders an Application in a Proceeding specifying the orders sought as to costs, and any affidavit in support thereof.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Borja & Charmchi has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
CAMPTON J:
INTRODUCTION
By way of an Initiating Application filed 2 July 2021 in the Federal Circuit Court of Australia (as it was then known), Ms Borja (“the wife”) commenced proceedings seeking orders for the adjustment of property pursuant to s 79 of the Family Law Act 1975 (Cth) (“the Act”). Mr Charmchi (“the husband”) by way of a Response to an Initiating Application filed 13 October 2021, sought different orders as to the adjustment of property.
In an Amended Initiating Application filed 4 December 2023 the wife additionally sought periodic spouse maintenance. That relief was opposed by the husband. At the commencement of the trial, counsel said that the wife no longer sought orders for periodic spouse maintenance. During her cross-examination, the wife said she did seek a spouse maintenance order, being confirmed at that time by her counsel. On the last day of the trial a consent order was made dismissing the wife’s application for periodic spouse maintenance.
The parties commenced cohabitation in 2009. They were married in 2014 and separated under the same roof either in late 2017, as asserted by the husband, or July 2018, as asserted by the wife. Nothing turns on the determination of the date of separation. The husband left the home in 2019. An order for divorce was made in 2020. The wife has three children from a previous relationship, Mr E, Mr F, and Ms G, who were aged 10, nine, and seven respectively at the commencement of cohabitation, all of whom are now adults. The two younger children gave evidence at trial. The husband has two children from a prior marriage. He did not have contact with them during the party’s relationship. There are no children of the marriage between the husband and the wife.
For the reasons that follow, the property of the parties is adjusted as to 60 per cent to the wife and 40 per cent to the husband.
The history of the litigation
From the commencement of the proceedings on 2 July 2021, the matter was docketed to a judge of what is now Federal Circuit and Family Court of Australia Division 2. On 11 January 2023 the docket judge listed the matter for final hearing in Division 2 over three days commencing on 11 July 2023.
On 25 May 2023 orders were made for the parties to attend a judicial settlement conference on 28 June 2023. For that judicial settlement conference, the matter was transferred to this Court. The judicial settlement conference was unsuccessful. On 5 July 2023 by the Deputy Chief Justice transferred the matter back to Division 2 for the final trial listed to commence on 11 July 2023.
On 12 July 2023, the docket judge, on the second day of the trial, transferred the matter from Division 2 back to this Court, noting:
A. This property matter was double-listed for final hearing of not more than three days commencing on 11 July 2023. The parties utilised the entirety of the first listed hearing day to explore settlement negotiations. Despite the best endeavours of the parties and their Counsel, the parties were not able to resolve their dispute. On the second listed hearing day the parties, through their respective counsel, advised the Court that the Final Hearing required an adjournment because it could not be heard in the listed time that remained (despite the Court being able to reach the matter) and because further evidence was to be filed. The Court was also advised that the [wife] may press an interim spousal maintenance application. Following further discussions between the parties, the Court was informed that although the [wife] would not be pressing her interim spousal maintenance application at this time, she made an oral application for a transfer of these proceedings to Division 1 of this Court given the complexities in the matter that had arisen from the available evidence and the likelihood that the final hearing length would exceed four hearing days. These complexities included her view that the Court should assess the parties’ contributions on an ‘asset by asset’ basis, her assertion that certain significant property legally owned by her was subject to a trust in favour of her adult children and hence should be quarantined from the matrimonial property pool, and expert medical evidence to be relied upon by both parties to support claims under section 75(2) of the Family Law Act 1975 (Cth). The [husband], through his Counsel, neither supported nor opposed, the oral application. Following further submissions, the Court determined that these proceedings should be transferred to Division 1.
B.As noted, the [wife] asserts that a number of relevant assets in these proceedings are held in her name on trust for her children pursuant to an agreement with the children’s father. The Court advised the [wife] that it would be necessary to put her children on notice of these proceedings and that she would likely need to abduce evidence from the children’s father in relation to their asserted agreement.
C. There is currently no dispute as to the valuation of the parties’ real estate assets.
D. Counsel for the [wife] indicated that the [wife] intends to pursue an application for spousal maintenance on a final basis.
E. The issues which remain in dispute are the size and composition of the matrimonial property pool, assessment of the parties’ respective contributions, assessment of both parties’ asserted future needs, and the [wife’s] application for spousal maintenance.
F. The matter is transferred to Division 1 on the basis that a Final Hearing of the property application is unlikely to be contained to not more than 4 days on the basis that the [wife] seeks that the Court adopt an ‘asset-by-asset’ approach, both parties seek to rely on expert medical evidence, and the [wife] asserts that a number of assets are held by her on trust for the benefit of her adult children.
G. The parties have reached agreement on a number of trial directions and indicated to the Court that they are willing to adhere to such directions.
(Emphasis added)
On 12 December 2023 the matter was listed for hearing in this Court to commence on 12 August 2024 and the following notation was made:
E.The Court is of the view that notwithstanding the orders made by Deputy Chief Judge McClelland in Division 2 on 28 October 2022, the matter was not the subject of active case management in Division 2 thereafter, and that the proceedings did not present on transfer from Division 2 with the complexities as identified in the Order made in that Court on 12 July 2023.
The matter was determined in this forum by way of the parties relying on their affidavit evidence filed in Division 2 supplemented by short updating material. The observation contained in Notation E made on 12 December 2023 was accurate. Issues at trial focused on discovery or “disclosure occurring on the run” as to the relevant financial circumstances of each party. The appearance time spent in this Court hearing the trial was just over two days. Additional time out of court was required because lay witnesses were only available only at specific times, because of a failure to comply with the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) as to notice being provided if the deponent of an affidavit was required for cross-examination, and more than a day was lost because of the sudden illness and hospital attendance of a party during their oral evidence.
The assessment made during the trial in Division 2 as to the proceeding being complex was inaccurate. The assessment as to the volume and content of evidence was significantly over‑stated.
A trial judge in another court who is asked by the parties or either of them to transfer a matter should critically evaluate the information upon which such application is grounded. That judge will be best placed to undertake such an evaluation where he or she has actively case managed the proceeding. I cannot see that either active case management or critical evaluation occurred because either would have made the transfer inexplicable.
As presently drafted, the Federal Circuit and Family Court of Australia Act 2021 (Cth) allows for transfer from Division 2 to this Court at the discretion of a trial judge absent scaffold or oversight. This is not the position in other courts. That discretion needs to be exercised carefully and cautiously because – as was seen here – the transfer has the very real consequence of serious delay for the parties.
BACKGROUND AND FINDINGS
The evidence of the husband and the wife
The wife encountered challenges in listening to the questions posed during her cross‑examination. Her responses to questions in her oral evidence was often disordered, electing to consider a question to be an opportunity to denigrate the husband. That said, large portions of her affidavit evidence were not materially shaken in cross-examination.
Important aspects of the wife’s recent and current financial circumstances, that ought to have been adduced by evidence-in-chief, only emerged through cross-examination, including that:
(a)The rental income she is receiving on a joint property at 1 B Street, Suburb C (“the 1 B Street property”) had increased from $620 per week, as recorded in her financial statement filed on 3 May 2024, to $875 per week;
(b)Contrary to, or at least opaquely identified in, her affidavit evidence her three adult children who occupy her unencumbered home are all employed. Mr E is a finance professional. Mr F is a healthcare professional earning $2,000 per week. Ms G is a tradesperson earning $3,000 per week. The wife largely subsidises the costs of the adult children occupying and living at the home in circumstances where she earns no personal exertion income, does not receive Centrelink benefits, and contends she has no current or future income earning capacity. She proffered no evidence as to why her children do not make a commensurate periodic contribution to the costs of the household from their property or income; and
(c)In approximately December 2023, while contending that she had insufficient property and financial resources at that time for her own self-support, she gifted $67,000 to Mr F.
The husband’s oral evidence was disparate, inconsistent, and often illogical. He was evasive, electing not respond to comparatively simple questions, preferring to provide self-serving assertions or an answer that he thought would assist his case, irrespective of whether that answer was accurate or consistent with his immediately preceding evidence.
Important aspects of the husband’s financial circumstances that ought to have been adduced by evidence-in-chief also only emerged through his cross-examination. The wife made broad assertions, absent particularity, that he had made large withdrawals of cash and that “someone is hiding money here”. In cross-examination, the husband conceded in July and August 2023 he had provided $10,000 and $5,000 to his “dear friend” Ms H, describing the advance as a “loan”. This advance was not disclosed in his affidavit evidence or financial statement. During submissions it was agreed that the value of the advance is included in Item 36, being an ANZ bank account of the husband, in the joint balance sheet.
Factual background and findings
The husband was born in 1965 and is currently 59 years old. The wife was born in 1968 and is currently 55 years old.
In 1992 the wife became the registered proprietor of a property at 2 B Street, Suburb C (“the 2 B Street property”).
The wife was married to Mr K (“Mr K”) in 1997. They separated in 2006. In 2000 the wife and Mr K purchased a property at L Street, Suburb M (“the Suburb M property”). The Suburb M property was sold in 2007 for $510,000. By way of an informal agreement as to the adjustment of property made between the wife and Mr K, $120,000 of the proceeds of sale from the Suburb M property was placed into a term deposit for the benefit of their three children. By the time of the trial the monies in that term deposit had accumulated to $210,000. In the shadow of the trial the husband agreed that the $210,000 held by the wife, together with a quantity of publicly listed shares, were the property of the wife’s now three adult children of her prior marriage, and not being property of the wife for the purposes of the s 79 proceeding.
By way of the agreement, at or after the separation from Mr K, the wife retained the unencumbered 2 B Street property.
It was uncontroversial at trial, and I find, that at the commencement of cohabitation the wife contributed the unencumbered 2 B Street property, retrospectively valued by the ch 7 single expert at $525,000 at 1 April 2009 (Exhibit 16), a small quantity of publicly listed shares, savings of $70,000, and superannuation valued at $25,000.
The husband was previously married to Ms J (“Ms J”). They separated in 2006. In late 2008, he and Ms J entered consent property orders. I find that at the commencement of cohabitation the husband contributed:
(a)Motor Vehicle 1 valued at $20,000;
(b)Furniture valued at $4,500;
(c)Bank account savings of $10,000;
(d)Property settlement proceeds valued at $350,000;
(e)Motor Vehicle 2 that was subsequently repossessed;
(f)Motor Vehicle 3 valued at $10,000. This vehicle remains in his possession;
(g)Personal effects, being two pieces of gold jewellery and a watch. I find because of the implied concession of the husband in cross-examination that another watch was a gift from the wife purchased after the commencement of cohabitation, his evidence that he had it at cohabitation is not accepted;
(h)Power tools valued at $8,000;
(i)Sports equipment valued at $1,200;
(j)Sporting memorabilia valued at $2,000; and
(k)Superannuation valued at $58,058.
Throughout the relationship, the husband occupied the 2 B Street property with the wife and her children. Renovations were subsequently undertaken to that property.
The wife was employed as an Administrator from early 2007. From late 2007 to mid-2010 the wife was employed as an Administration Manager. From early 2011 to early 2014, she was employed on a full-time basis as a Senior Account Manager. In late 2014 the wife commenced full-time employment as a Consultant, earning renumeration of $69,000 per annum. Throughout the relationship she was also casually employed.
The wife experienced a traumatic work event. She did not adduce evidence as to the date, nature, or context of her experience. Implicitly, her evidence suggests it occurred a short time prior to early 2018, leading to her to ceasing employment in late 2018. She received workers compensation of $1,000 per week from early 2018 until early 2022. Since early 2022 she has not received any workers compensation payments. She adduced no evidence of making an application for Centrelink benefits.
I find, in accordance with the wife’s affidavit of 22 June 2023, that the taxable income of the wife was:
Year Taxable income 2008 $22,145.00 2009 $35,065.00 2010 $23,723.00 2011 $32,708.00 2012 $91,763.00 2013 $45,912.00 2014 $20,044.00 2015 $48,881.00 2016 $74,659.00 2017 $79,649.00 2018 $67,855.00 2019 $72,386.00 2020 $75,223.00
At the commencement of cohabitation, the husband was employed at N Company. Sometime in 2010 the husband purchased the trade enterprise “[O Company]” for $20,000. He was thereafter self-employed in that enterprise. He continues to be self-employed.
I find that the taxable income of the husband (Exhibit 13) was:
Year Taxable income 2009 $18,427 2010 $8,611 2011 $11,828 2012 $0 2013 $73,963 2014 $34,890 2015 $23,752 2016 $8,891 2017 $26,444 2018 $62,726 2019 $18,694 2020 $19,752 2021 $68,637 2022 $41,462 2023 $58,138
In 2009 the husband purchased a property at P Street, Suburb Q (“the Suburb Q property”) in his sole name for $490,000. The funds for the acquisition were sourced from his savings, the $350,000 received from his previous division of matrimonial assets with Ms J, and by way of a mortgage to Westpac in the sum of $150,000. He additionally paid for the stamp duty and legal costs of the purchase in the sum of $20,000.
The husband spent approximately $6,000 repairing and renovating the Suburb Q property. It was rented from early 2010 for on average nine months each year for $600 per week. He currently receives $630 each week in rental payments from the property. The rental income the husband received from the Suburb Q property was insufficient to pay the interest on the mortgage and the other outgoings on the said property, generating a taxable loss, from 2010 until the 2012/2013 financial year (Exhibit 13). From 2010 to the time of separation, he and the wife stayed at the property on approximately eight occasions.
The wife said that in 2009 Mr K, the father of her children, obtained an Apprehended Violence Order (“AVO”) for the protection of she and the children. She identified an AVO complaint and summons to support her contention. She gave no evidence as to her role or observation in attending court or in giving evidence. The wife has failed to establish that an AVO order was made restricting the behaviour or conduct of the husband. I accept the husband’s evidence that Mr K made an AVO complaint of which the husband was the defendant that was dismissed on its merits in the Local Court.
In late 2012 the husband and the wife exchanged contracts for the purchase of the 1 B Street property for $495,000. The purchase completed in early 2013.
The husband contributed $103,000 to the purchase. The wife in her affidavit said she contributed $70,000 to the purchase. The husband said he “believed” she contributed $50,000. Remarkably, after three years litigation, this remained a fact in issue until the wife’s cross examination at trial. Either the husband did not enquire of the wife as to whether she had documents verifying the value of her contribution, or the wife elected not to disclose such documents. During the cross-examination of the wife bank statements emerged that supported her affidavit evidence. I find that the wife contributed $70,000 to this purchase. Both the husband and the wife agreed the balance to complete the acquisition was funded by way of a $350,000 loan secured over the property from the ANZ Bank.
The 1 B Street property was leased from 2013 to mid-2020. The property was vacant from mid‑2020 to early 2021, being leased from that later date until the date of the trial. It was uncontentious that until at least December 2019, the rental income from the property was paid into the parties’ joint mortgage offset account and all rental payments were applied to the mortgage and outgoings of the property.
The parties agreed that throughout the relationship their bank accounts remained separate, save for mortgage offset account for the 1 B Street property.
The husband said that in December 2019 the wife unilaterally redirected the rental income from the 1 B Street property from their joint mortgage offset account to another account that she opened with ANZ in the names of herself and the three children. The wife said that she redirected the rental income to that ANZ account in or around March 2020 because the husband had withdrawn $3,000 from the offset account without notice, her action being to preserve the rental monies to pay for the mortgage and the outgoings. In cross-examination she said all rental monies were deposited into the ANZ account, in her name on trust for her children, and were then applied to fund the mortgage and outgoings of the 1 B Street property. She was not challenged on this evidence. I so find.
The wife submitted that in mid-2020, upon a long-term tenant vacating the 1 B Street property, the husband attempted a “rental sabotage” directed to creating “financial pressure” to cause the mortgage loan to fall into default, for the mortgagee to take possession and sell the property, and for he then to receive “half of the proceeds of sale”. She gave evidence as to the husband removing a rental agent’s “for lease sign” located at the property, him making threats to the agent, and an event where the police attended the property while the husband was purporting to “evict” potential new tenants. The wife said that the husband’s conduct caused the 1 B Street property to be vacant for seven months, generating lost rental revenue of $18,186.
The husband denies the “rental sabotage” contended by the wife. He said that the agent removed the “for lease sign” upon him informing the agent that he was a joint owner of the property and had not signed the agency agreement. He conceded in cross-examination that he was present when the police attended.
The cross-examination of the husband established, and I find, that attempts were made to facilitate his execution of the real estate agent’s agreement for the leasing of the property, and that he refused to do so. The husband had the opportunity to adduce evidence as to why he refused to facilitate the leasing of the property. Only he could do that. He elected not to do so. All evidence must be weighed and assessed having regard to the capacities of the parties to adduce and contradict it (Vetter v Lake Macquarie City Council (2001) 202 CLR 439 at 454). I find the husband’s conduct in not facilitating the leasing of the property, and it subsequently being vacant, is a relevant matter to be considered.
The wife said that she was “always” the person who paid for the council rates for the 2 B Street property, she paid for half of the electricity and water rates for the property, she paid for all the home and property insurance, paid “99 per cent” of the groceries, health insurance, home internet, and purchased her own car and maintained it. She gave particularised evidence in her affidavit that she has paid at least $84,281 for health insurance, home insurance, car insurance, the home phone, and internet during the relationship (not including groceries), and that the husband paid for 50 per cent of the water rates and electricity, totalling $14,118 (at paragraph 59 of the wife’s affidavit filed 5 July 2023).
The husband conceded that the wife alone paid for the council rates on the 2 B Street property. He said that he “usually” paid for the water rates, electricity accounts and “arranged” and paid for the mobile phones of the wife and her children. In his affidavit, the husband said that throughout cohabitation he contributed $250 – $300 each week to the living expenses of the parties. In cross-examination it was put to him he had contended he had contributed approximately $500 each week to household expenses, to which he agreed that he did. He later conceded he could not answer whether there were any documents, including bank statements, to verify his contended weekly payments to the household, and that “all [he] can say” is that he has contributed to the household by way of the “necessities to feed a family of five”.
The wife submitted the husband exhausted his property settlement proceeds with Ms J of $350,000 and his savings to complete the acquisition and improvement of the Suburb Q property in 2009. She said he could thereafter only accumulate and contribute $103,000 to the acquisition of the 1 B Street property in late 2012 – early 2013, when his total taxable income for the period from 2009 until 2013 was $112,829 (Exhibit 13), because he saved all his income and did not contribute to the household expenses of the 2 B Street property, and effectively living “rent free” from 2009.
Having regard to:
(a)The logic of the wife’s submission in the prior paragraph, to which the husband could counter no cogent alternative explanation;
(b)The husband’s opportunistic embracing of the inaccurate proposition put to him in cross-examination as to the value of his weekly contribution to the household being $500 each week, as opposed to his affidavit evidence of $250 – $300 each week, suggesting an absence of integrity to his evidence; and
(c)The particularised evidence of the wife in her affidavit as to payments of household expenses for the 2 B Street property, it not being materially challenged in her cross‑examination;
I prefer the evidence of the wife as to the fact and value of periodic contributions made by each party to the costs of maintaining the household at the 2 B Street property during cohabitation, and so find. I find that save as conceded by the wife, the husband broadly retained his income to supplement the shortfall in income generated from the rental of the Suburb Q property from its expenses (as recorded in his taxation returns) until 30 June 2012, when the Suburb Q property commenced to produce a surplus, and that he continued to broadly retain that surplus and his business enterprise income for his own benefit. I find that he paid the costs of travel for the parties to Country R on two occasions.
Renovations to the 2 B Street property
The husband said that when he commenced to reside in the 2 B Street property, it presented with electrical wiring being exposed, mould accumulation, missing light fittings, severe cracks in the walls, rusted and missing gutters, collapsed boundary fencing, a dilapidated kitchen, and insect infestations. The husband said renovations to the property were conducted from mid‑2009 to 2013.
The husband at paragraph 46 of his affidavit said “[t]he costs of all repairs and renovation works were wholly borne by me from my personal funds. I purchased all materials and equipment and I personally performed and or caused tradespersons to perform the following works”. He thereafter included the following self-authored table detailing the works done to the property and the asserted value of each item of work:
a) painting internal – labour inclusive $22,000 b) painting external – labour inclusive $18,000 c) painting – fence $1,440 d) painting internal feature wall lounge room $2,400 e) removal of established trees […] stumps $2,500 f) new fence – front/side $3,290 g) floor sanding and polish labour inclusive $1,580 h) plumber […] main sewer $1,800 i) pest control x 2 $780 j) road base gravel $80 k) sewer charges rear downpipes $475 + labour $715 l) plumbing $380 + labour $1,340 m) new mailbox $176 + labour $296 n) new kitchen / appliances $860 + labour $3,260 o) new corner kitchen cabinet $480 + labour for [Mr X] $680 p) shed concrete / frame $430 + labour for [Mr Y] $1,390 q) new shed placed labour only $720 r) skip bin $560 + labour $1,520 s) removal / cleaning under house storage $1,920 t) entry path to front door $1,440 u) gutters east/west side of house $355+ labour $835 v) internal door stoppers ( new ) $158 + labour
w) skirting boards ( new )
$638 throughout the house $420 + labour $1,860 x) electrical ( new ) switches / sockets / downlights […] $788 + labour $3,288 Total $83,772
The husband then said:
47.I have retained receipts for all purchases made and invoices of tradespersons engaged which total $83,772. The works were performed over a number of years from about mid 2009 up until 2013. All records are available upon hearing or as otherwise requested and in the possession of [the wife].
A call was made for the husband to produce the invoices and receipts totalling $83,772. It was not answered. He did not produce a single document in response to the call.
The wife gave evidence in her affidavit that she paid for works performed on the 2 B Street property, conceding that the husband had paid $600 for floorboards and $700 for a second‑hand kitchen. She said that she had meet the costs of tradesman and that she had bank statements or credit card statements recording the fact and value of items she paid. She estimated the husband to have spent $2,300 on materials.
Whilst the wife said that some items such as tree stumps were not removed, she did not put into issue the fact of the husband undertaking internal and external painting and doing some other works such as replacing a fence or renovating a laundry. Her complaint was directed to the quality of his painting work. She cited that the husband had no carpentry or building qualifications or experience, putting that his labours of this character produced a deficient product. She imprudently adduced evidence of photographs of the works undertaken by the husband purporting to establish the absence of quality of his work. The wife did not adduce evidence of she requesting the husband not undertake the works he physically performed. It is well established that there is no requirement for a contribution, such as that made by the husband in the application of his labour to the 2 B Street property, to produce positive result as a condition of it being taken into account (Browne v Green (1999) FLC 92-873).
I broadly prefer the wife’s evidence in finding as to this renovation that the husband undertook more of the physical labour and the wife meet the costs of tradesman and materials because:
(a)The particularity of the wife’s evidence was supported by her evidence that she had the source documents and bank statements verifying it available for tender. This evidence was not challenged and there is no reason why it ought not be accepted;
(b)The wife did not put into issue the fact of physical labours being expended by the husband on some items in the schedule; and
(c)The integrity and reliability of the husband’s evidence on this topic was seriously compromised because:
(i)The inference is available, and I find, that notwithstanding his sworn evidence, the husband did not have the invoices to support his evidence. I find that at no time did he pay $83,772 for the repairs or renovation. He conceded that many of the values he asserted to each item, for which he said he had an invoice or receipt that he had paid, included his opinion as to the value of his own labour in items. By way of example, $22,000 for “painting internal – labour inclusive” was his estimate of the value of his labour. No invoice or receipt ever existed for this item. It was a fiction to give evidence that such an invoice existed. That value of that item was never paid. He agreed the same applied to other items., such as (b), (c), and (d);
(ii)Further eroding the husband’s evidence on this topic was his failure to specify the apportionment in each item of value between materials and labour. He elected not to give evidence as to the date or the duration of his labour for each item; and
(iii)The findings made (at [42] and [43]) supports the conclusion that the husband did not have excess funds available to pay for materials used in the repair or renovation until early 2013, being after he contributed $103,000 to the acquisition of the 1 B Street property.
The husband said that throughout the relationship he spent approximately $10,000 on furniture for the 2 B Street property, of which the wife retains. He bore the onus to establish such a contention. He did not adduce evidence to support his contention, specifying the items acquired, when it was purchased, and its cost. He did not adduce any invoices, receipts, or bank statements to support his summary evidence. I am not satisfied the husband discharged the evidentiary onus on this topic.
Renovations to the 1 B Street property
The 1 B Street property was renovated prior to it being leased. The husband said that these renovations were undertaken by him personally with the assistance of paid tradesman:
a) painting external labour inclusive $16,500 b) painting internal labour inclusive $21,500 c) skip bins […] $760 + labour $1,720 d) landscaping $360 + labour $2,760 e) front gutters $520 + labour $1,600 f) curtains / blinds $590 + labour $1,070 g) roof repairs […] $930 + labour $1,890 h) bathroom remodelling + labour – […] neighbour $6,230 i) polished floorboards + labour ([Mr Z]) $1,800 j) removal of carpet $320 + tip + labour $1,280 k) electrical box new labour inclusive ([Mr AA]) $1,500 l) plumbing laundry $480 + labour $960 m) laundry basin new $190 $430 n) [structure] removal + labour $960 o) light fittings new internal $630 + labour $2,070 p) […] side gate + labour inclusive $800 q) tilling chimney labour inclusive $280 Total $63,350
He said that the works and materials in the sum of $63,350 were paid for solely by him, and that all receipts and invoices for those works are in the possession of the wife. The husband’s 2013 tax return (Exhibit 13) identifies the value of these costs as $8,435, not $63,350 as he contends in his affidavit.
The husband’s self-authored table was unreliable because it included unparticularised amounts for his labour, as was the case for the renovations to the 2 B Street property, especially as to items (a) and (b). He could not reconcile his table of repairs with the contents of his taxation return. If the records, receipts, and invoices for the work performed on that property are in the possession of the wife, the table would be prepared from the husband’s memory from 10 years ago. Each of these considerations reduces the reliability and integrity his self-authored table.
The wife said that she, the husband, and her daughter Ms G contributed to the renovations, and that she engaged her next-door neighbour to retile the kitchen splashback and, more recently, the bathroom. She did not put to the husband a proposition that he did not spend any funds on this renovation.
It emerged that both the husband and the wife undertook painting works and removal of carpet and wallpaper for the property.
I broadly prefer the wife’s evidence on this topic. I accept that the husband carried out renovations to the 1 B Street property, however I do not accept that he expended the sum of $63,350 on such renovations. On balance, I find that the husband likely put money to the renovations of the 1 B Street property, however that money was not expended on labour costs in the amount that he asserts, and he has not adduced evidence to establish findings as to the particulars of the amount he expended.
Allegations of family violence
The wife contends that her contributions were made more onerous than they ought to have been by way of violence perpetrated by the husband such that her homemaker contributions should be afforded more weight, grounded from the principles identified by the Full Court in Kennon v Kennon (1997) FLC 92-757 (“Kennon”). The husband categorically denied any claim of family violence.
The wife’s affidavit particularised some incidents of family violence from 2009 until 2018, including the husband striking a child with his fist, slapping a child on the leg, throwing a shoe at another child, throwing and breaking a chair, smashing a child’s phone, punching the wife, lifting a child by the neck and pinning him to the wall, and raising his fist as if to strike a child.
Other allegations were broad, summary, and absent specificity.
The wife said that the husband would hit the children when she was not around, and “they would tell me”, the material grandparents, Mr K, and the wife’s sister. None of these individuals other than the wife gave evidence in the proceeding. It was difficult to ascertain as to whether some of the instances of conduct as described has been observed by the wife and which instances had been reported to her and by whom.
A large portion of the evidence as to specific instances of family violence was absent context.
The wife was challenged in a cursory fashion as to her evidence on this topic. She remained firm and unshaken. No probative reasons were advanced not to accept her evidence. The wife’s children Ms G and Mr F gave evidence of their own experiences of the family violence occasioned by the husband. Their evidence, challenged in cross-examination by little more than putting that it did not occur, supported that of the wife.
I find that the husband occasioned family violence upon the wife and her children in terms of the particularised incidents of family violence for the following reasons:
(a)The wife and the two children each recalled in specific detail attending the Suburb Q property and leaving early, returning by train, after the husband struck one of the children with his fist and throwing his shoe at another child. I accept that evidence;
(b)Mr F provided particularised evidence as to the husband slapping him across the face and on his arms and legs, leaving handprints on their bodies. In re-examination Mr F was taken to a photograph of a hand mark on a leg, of which he identified was himself. This is consistent with the evidence he gave of the husband slapping him and leaving hand marks on his body; and
(c)Mr F convincingly described an instance in which the husband took his mobile phone and smashed it with a hammer. That evidence was supported by the evidence of the wife. I accept his evidence.
Whilst I accept that broadly the husband’s generalised conduct would have made the household unpleasant, the wife’s evidence that his “constant” occasioning of violence was absent particularity and context, including, for example, as to when the violence would occur or in what circumstances. The wife has failed to establish to the requisite standard that that the violence of the husband was “constant”.
Other matters
Upon marriage in 2014, the parties travelled to Country R for their honeymoon. I accept the husband’s evidence that he spent some of the rental income from the Suburb Q property for honeymoon expenses and to purchase his motor vehicle.
The husband submitted that the wife “did not attend to any outdoor maintenance or upkeep of the property”. In cross-examination, in response to a suggestion that the wife undertook gardening from time to time, he said “yes she did, of course she did”. I find that both the husband and the wife undertook outdoor maintenance at the 2 B Street property.
The wife said that she performed “all of the cooking and preparation of food”. When they entertained guests, the husband would cook the meat on the barbeque. There is no reason not to accept that unchallenged evidence of the wife and I so find. The wife said that throughout the duration of the relationship, that she undertook almost all the housework and looked after her children. The husband conceded that the wife did most of the cooking and “general cleaning” and was all but the sole carer of her children in the household, and I so find.
It was uncontroversial that throughout the relationship the wife received child support from Mr K as assessed by the Child Support Agency. The husband did not submit that any other finding ought to be made on this subject matter and hence I so find.
The husband conceded in his cross-examination that he had few positive interactions with the children during the relationship. In submissions it was confirmed that he was not contending that there ought to be an adjustment to any contribution finding in his favour arising from the principles identified by the Full Court in Robb & Robb (1995) FLC 92-555 grounded from his role by indirectly financially maintaining the wife’s children or by way of his parenting them.
Post-separation
The husband said the wife took money from the offset account to pay a credit card debt. Implicitly, it was a credit card debt incurred funding the living costs at the 2 B Street property. It was not submitted by the husband that this was not a proper application of the parties’ funds. I accept that the wife’s conduct was a proper discharge of a liability incurred for the benefit of the parties.
The wife said that upon his departure from the 2 B Street property, the husband took with him $40,000 in cash, which had been “hidden” in their wardrobe. In cross-examination the wife conceded that she did not have access to these monies, as she “didn’t touch any of his money as it was out of bounds” and said that she knew it was $40,000 because the husband “counted it in front of [her]”. The husband contended that he had $4,500 in cash in the home that the wife took while he was in Country R. I carefully observed the evidence of both the wife and the husband on this topic. I found them each to be unconvincing. There was no primary evidence in the case of either party as to the source of each respective quantum of cash, each party confirming expressly the construction of their case being grounded from the husband’s taxation returns as lodged being accurate and correct. There was no evidence as to the period over which each respective quantum of cash has accumulated, or how long it had been held in the home, or when, or the context in which, the husband had counted the cash in the presence of the wife. I find that, on the evidence of each party, there was a quantity of cash in the home at or around separation, but the evidence is insufficient to establish to the requisite standard a finding as to the value of the cash or as to which party retained it.
The wife said that since separation she has reduced the mortgage on 1 B Street from $290,000 to $261,000, implicitly by the application of rent. This evidence was not challenged, and I so find.
In mid-2020 an order for divorce was made by the Federal Circuit Court (as it was then known).
In late 2020 the husband received $183,206 from his late mother’s estate. The remaining balance of these funds are in the husband’s Westpac account.
Sometime in 2020 the wife received $100,000 from her late uncle prior to his death. Sometime in 2022 she received a further $30,000 from her late uncle's estate. The thrust of the wife’s case is that these funds have been expended.
THE COMPETING RELIEF SOUGHT
By the time of final submissions, the wife amended her relief sought to be:
(a)To retain the 2 B Street property;
(b)For the husband to retain the Suburb Q property;
(c)For the husband to transfer his interest in the 1 B Street property to her; and
(d)For the husband to pay her a fixed sum of $300,000 within 42 days, and in the event of default, for real property to be sold so she would receive the capital sum from the husband.
By that time the husband sought:
(a)To retain the Suburb Q property;
(b)For the wife to retain the 2 B Street property;
(c)For the 1 B Street property to be sold, for the mortgage on the property and selling costs to be sold, and for he to then receive 55 per cent from the remaining proceeds of sale and the wife the balance.
THE LAW
In determining claims for alteration of property interests between married couples, I am required to:
(a)Make findings as to the identity and value of the property (including superannuation interests), liabilities, and financial resources of the parties, or either of them, at the time of the final hearing, and determine the legal and equitable interests of the parties in such property;
(b)Consider, identify, and assess the contributions by the parties to the acquisition, conservation and/or improvement of their property, including financial and non‑financial contributions and any contributions to the welfare of the family before, during and after the relationship came to an end;
(c)After consideration of altering the interests in the property pool on the basis of contributions, to consider whether there should be any further adjustment to either of the parties on account of the matters set out in s 79(4)(d)–(g) of the Act, including any relevant considerations under s 75(2); and
(d)Ensure that any order made is just and equitable.
THE BALANCE SHEET – IDENTIFYING THE PROPERTY OF THE PARTIES
By the time of the conclusion of submissions, a final joint balance sheet of the parties became Exhibit 21. Their property interests and their value were agreed, except for the items that were not agreed, appearing in bold as determined in the following table:
Ownership Description Wife’s value ($) Husband’s value ($) Determination ($) ASSETS 1 Joint 1 B Street, Suburb C NSW 1,300,000 1,300,000 1,300,000 2 Wife 2 B Street, Suburb C NSW 1,350,000 1,350,000 1,350,000 3 Husband P Street, Suburb Q 1,200,000 1,200,000 1,200,000 9 Wife Shares 4,118 4,118 4,118 10 Wife Shares 8,514 8,514 8,514 12 Wife Shares 7,735 7,735 7,735 16 Husband Motor Vehicle 4 14,528 14,528 14,528 17 Husband Motor Vehicle 3 19,500 19,500 19,500 18 Husband Motor Vehicle 5 750 750 750 19 Husband Trailer 1,000 1,000 1,000 20 Husband Motor Vehicle 6 5,795 5,795 5,795 21 Husband Business – O Company 15,000 15,000 15,000 23 Husband Sports Memorabilia autographed 20,000 20,000 20,000 24 Husband Household effects 5,000 5,000 5,000 25 Wife Jewellery wife 5,000 5,000 5,000 26 Husband Jewellery and watch collection husband 20,000 3,570 3,570 27 Wife Furniture 4,250 4,250 4,250 28 Husband S Bank NK 1,250 1,250 29 Husband T Bank Country R NK Nil 0 33 Wife Motor Vehicle 7 – Statutory Write off 1,650 1,650 1,650 36 Husband ANZ A/C …68 15,386 15,386 15,386 37 Husband Westpac A/C …00 128,357 27,406 39,672 38a Wife Fees received by the wife as executor of will Nil 47,000 0 Total 4,039,148 4,069,718 4,022,718 ADDBACKS 40 Husband Joint monies taken by husband from Offset account for his personal use after separation in 2019 – 2020 3,000 3,000 3,000 41 Husband Cash taken by husband at separation 40,000 Nil 0 42 Husband Loss of eight months rental caused by husband 18,000 Nil 0 Total 61,000 3,000 3,000 LIABILITIES 44 Joint Mortgage ANZ Joint (1 B Street) 261,857 261,857 261,857 46 Wife American Express Credit Card 9,846 Nil 0 48 Joint Land Tax – 1 B Street 8,408 8,408 8,408 49 Husband Westpac Home Loan Suburb Q property 36,503 36,503 36,503 51 Husband Visa – credit card 2,625 0 0 52 Wife Visa – credit card …47 14,741 0 0 53 Wife Queensland Government Debt 2,800 2,800 2,800 54 Wife Council Rates (2 B Street) 1,065 Nil 0 55 Wife Electricity Account – U Company 848 Nil 0 56 Joint Council Rates 1 B Street, Suburb C 1,033 Nil 0 57 Wife Loan from Mr F 98,000 15,117 0 57a Husband Land Tax – Suburb Q 6,790 6,790 6,790 Total 432,502 331,475 316,358 TOTAL ASSETS – LIABILITIES 3,709,360 SUPERANNUATION Member Name of Fund Type of Interest Wife’s value ($) Husband’s value ($) Determination ($) 58 Wife Superannuation Fund 1 Accumulative 30,262 30,262 30,262 59 Wife Superannuation Fund 2 Accumulative 35,559 35,559 35,559 60 Husband Superannuation Fund 3 Accumulative 163,141 163,141 163,141 Total 244,321 244,321 228,962 FINANCIAL RESOURCES Ownership Description Wife’s value ($) Husband’s value ($) Determination ($) 62 Husband Business – husband’s interest in retail business in particular V Business NK Nil 0 Total 0 TOTAL NET SUPERANNUATION + NON-SUPERANNUATION 3,938,322 Item 26 – Jewellery and watch collection of the husband
The husband said that he has one watch purchased 12 years ago, which he values at $420. The wife does not dispute this value and I so find.
The wife contends that some of the items comprising the husband’s jewellery and watch collection includes multiple watches, a large jewellery box with a variety of gold jewellery, a solid platinum gold ring, and a solid gold coin. The husband was not cross-examined as to any of these items save as to one of the watches. The wife has not established to the requisite standard that these items are in the husband’s possession. The wife achieved orders made by Schonell J on 12 June 2024 to appoint a single expert to value jewellery. She did not seek to have these items valued by the expert. She did not adduce evidence to establish their value.
The single expert opined as to the value of a single piece of gold jewellery in the husband’s possession at $3,150 (Exhibit 15). No dispute exists as to the value of this item.
The husband said that he had two pieces of gold jewellery, one that he buried with his mother in 2018 and a second that was produced to and valued by the single expert. The wife contends the husband has another piece of gold jewellery that he has not made available for valuation.
It is the wife’s case that postings on social media identify a different piece of gold jewellery worn by the husband, not being the piece valued by the single expert.
The orders made by Schonell J on 4 June 2024 directed instructions to the expert to value the husband’s “[…] men’s gold [jewellery] of [a certain] design”. The joint letter of instruction to the expert dated 27 June 2024 requested the expert value a “[…] gold men’s [jewellery] of [a certain] design”. The letter included three photographs of a piece of jewellery being worn by the husband (Exhibit 15).
The expert provided a report recoding an inspection of a piece of jewellery produced by the husband. The expert said in email exchanges with the solicitors for the parties that the jewellery in the photographs forming part of the instructions “does not look like [the described style of jewellery]”, and that it instead looked like a “[different style of jewellery]”. The expert said that she did enquire with the husband as to whether he had produced the correct piece of jewellery to value because it looked different from that in the photographs.
The cross-examination of the husband on this discrete topic was lengthy, disordered, and confusing, interchanging starting points and shifting defining terms such as “thick gold [jewellery]”, and “thin gold [jewellery]”, while then linking these variations to the jewellery buried with the husband’s mother, jewellery depicted in social media postings, and jewellery that was produced to the expert.
The wife does not give adduce evidence as to when any of the various pieces of jewellery were acquired, or how much each cost.
The wife seeks a finding that the husband has engaged in “continuous and deliberate acts of asset concealment” to deceive the expert and the Court, causing her to incur unnecessary costs. She bears the onus to establish that serious primary contention to the standard identified in s 140 of the Evidence Act 1995 (Cth).
Notwithstanding that the husband may have given inconsistent answers as to whether in 2020 he was wearing the piece of gold jewellery had been buried with his mother in 2018, this occurred after a lengthy confounding period of cross-examination on this topic. It is my view that he did not properly understand or comprehend many of the questions on this topic. The questions in cross‑examination by that time were difficult to follow and were confusing.
I find there were differing understandings between the parties of the description of the gold jewellery. This originated from the order for valuation, was perpetrated through the letter of instruction, and concluded both in the variable descriptors absent a firm reliable foundation in the email exchanges with the expert after production of the valuation and the oral evidence.
The wife conceded that she could not establish the value of the other gold jewellery she contends the husband has not disclosed.
A forensic decision was made not to cross-examine the single jewellery valuation expert. To the unqualified eye, the images of jewellery taken from social media (Exhibit 15) may not be dissimilar to that in the reproduced image of the jewellery valued by the single expert in her report. Absent cross-examination of the expert, it would be unsafe to find as whether the jewellery in the images is different from the jewellery valued, and if so, whether their respective values may materially differ. I am not satisfied that the wife discharged that onus to ground the serious finding that she seeks as to another piece of gold jewellery in the husband’s possession.
The wife’s contentions on the subject matter of the gold jewellery, including as to a calculated failure to disclose, are not established.
Item 28 – S Bank
The value recorded of the item is recorded in the husband’s financial statement filed on 2 May 2024. The wife submitted that value was unreliable because the husband has not recently “checked the balance”. She adduced no evidence requesting the husband to provide an update to the balance from that in his financial statement. She did not put to the husband that he had engaged in any transactions using that account since the financial statement was sworn. Her speculation contending a disclosure failure because the husband had failed to check the balance of the account between the date of the financial statement and the trial, absent request from her for him to do so, was a nonsense and misconceived. I find the value of this item to be $1,250.
Item 29 – T Bank of Country R
The wife adduced into evidence a translated letter from T Bank of Country R directed to the husband and his prior wife Ms J, dated 6 November 2017. One reading of the letter leads to the conclusion that their joint account had not been operated for more than 20 years and any balance had been forfeited to the Country R government. Another reading concludes that the account had not been operated upon for either five, or 10, or 15 years, and that any deposited money would be forfeited to the Country R government if that circumstance continued for 20 years. The cross-examination of the husband on the topic was ineffectual. It did not establish, from a letter dated almost eight years ago, the wife’s contention as to the husband failing to disclose a current material credit balance held by him and Ms J in this Country R bank account. The item is rejected.
Item 37 – Westpac A/C …00
This account holds the remaining balance of the husband’s post-separation inheritance. Neither party could establish their contended values of this item from the evidence adduced at trial. The best evidence was in the husband’s financial statement, recording the balance of the account at $39,672. The value of the account is as recorded in the husband’s financial statement dated 2 May 2024.
Item 38a – Fees received by the wife as Executor of Will
The wife’s affidavit evidence as to the value of fees she received in her capacity as the executor of an estate, or by way of reimbursement of estate costs she had paid, was unsatisfactory. She recorded in her affidavit that she had been advised that if her application to be paid executor’s commission from the estate was successful, she would be paid approximately $20,000. She did not adduce any further evidence-in-chief as to when or why she received $67,000. That evidence was indirectly identified through the affidavit evidence of her son, Mr F.
The husband’s construction as to the net value of this item was the product of $67,000 less what the wife said in her financial statement was advanced to her by Mr F, being $15,117. The husband’s value is then rounded by an unidentified arithmetic process to $47,000.
It was agreed that the wife no longer has these funds. The husband contended that they ought to be notionally added back to the property of the parties, all be it he made no direct or indirect contribution to them. It is well-established that the concept of adding monies that no longer exist ought to be the exception rather than the rule (Trevi & Trevi (2018) FLC 93-858). The husband concedes he made no direct or indirect contribution to these funds. No cogent submission was made to ground the addback of the funds. The capacity of the wife to gift significant monies to her adult son will also be considered in the adjustment to the contribution findings.
Item 40 – joint monies taken by the husband from the Offset account for his personal use after separation in 2019 – 2020
The findings as to this item are recorded at [36]. The addback by way of this item was agreed.
Item 41 – Cash taken by husband at separation
For the reasons at [72] the addback of this item is rejected.
Item 42 – Loss of 8 months rental caused by husband
The addback is rejected for the reasons identified in the jurisprudence recorded earlier for Item 38a and because the wife agreed in submissions that her quantification of the lost rental income was speculative and could not be established to the requisite degree by way of the available evidence. The conduct of the husband will be considered in the adjustment to the contribution findings.
Items 46, 51, and 52 – American Express Credit Card, Visa credit card …46, and Visa credit card …47
These are current credit card debts of both the husband and the wife. They will not be included as a liability of both the parties where:
(a)It has been six years since their separation;
(b)No evidence was adduced as to the identity of items purchased to ground the debit value of each credit card, or when such purchases were made; and
(c)To the extent that any of the wife’s credit card debts may be attributed to her household expenses, it has been her decision subsidise the periodic living costs of her income earning adult children holding significant funds at bank.
Item 54 – Council rates (2 B Street)
The de minimis value of this liability is reflective of the approach taken by these parties. The liability is an outstanding periodic instalment of rates for the wife’s property that, in the ordinary course absent evidence to the contrary, will be paid as and when it falls due. It is not just and equitable to take into account such expense by way of a liability of the parties, it being incurred for the occupation of a property by the wife and her adult children.
Item 55 – Electricity Account – U Company
This item is rejected for the same reasons as identified for Item 54.
Item 56 – Council rates 1 B Street
This periodic instalment item is rejected. It will be paid from the periodic rent when it is received.
Item 57 – Loan from Mr F (son)
No evidence was adduced as to the terms of any oral or written agreement between the wife and her adult son Mr F as to the advance and repayment of funds. The wife’s financial statement contains a summary assertion as to the fact of a loan quantified at $15,117. The wife did not reconcile her gift of $67,000 to Mr F in late 2023 with the fact of a current loan liability. It would be nonsensical for the wife to have gifted $67,000 to her son less than a year ago and then to borrow monies she gifted back from him. The item is rejected.
Items 58 – 60 Superannuation interests
The agreed addition of the value of each of these items by the parties in Exhibit 21 was inaccurate. The value of the three interests is $228,962, not as recorded in Exhibit 21, being $244,321.
Item 62 – Husband’s interest in retail business in particular V Business undisclosed
The wife’s speculation as to the content of the husband’s social media postings led her to the conclusion that he had some interest in this enterprise, and that the husband had attempted to secrete that fact and terms of this interest from her. The husband denied that he had any interest in the entity.
The husband adduced from Ms W, the founder and owner of the business enterprise trading as V Business. In her affidavit at paragraph six Ms W said that the husband “has never had an interest related to my business and has never received any payments or commissions from me.” Both her affidavit and oral evidence was unequivocal to that effect, save as to she personally paying for the husband’s flights from Sydney to another city for a photo shoot because “he was her friend”, as she felt that he was unwell and needed to “forget all [his] problems” and “experience something different”. Her evidence in cross-examination was unshaken. There is no reason not to accept it.
The High Court in Hall v Hall (2016) 257 CLR 490 said at [55] that “[w]hether a potential source of financial support amounts to financial resource of a party turns in most cases on a factual inquiry as to whether or not support from that source could reasonably be expected to be forthcoming were the party to call on it.” The wife failed to establish that if the husband made a call upon Ms W or V Business, that support could reasonably be expected to be forthcoming. I find that the husband has no financial resource by way of either.
IS IT JUST AND EQUITABLE TO ADJUST PROPERTY?
In Stanford & Stanford (2012) 247 CLR 108 the High Court observed that it is necessary for me to be satisfied that justice and equity will be achieved as part of the adjustment process pursuant to s 79 of the Act. The requirements identified in the High Court are readily satisfied in this matter having regard to:
(a)The long period of the relationship of the parties and the myriad of contributions made over that period;
(b)The parties’ relationship having broken down and them now living apart;
(c)The concession of each party as to property being adjusted to one another and the inability of the parties to continue to jointly own their 1 B Street property; and
(d)When consideration is given to the contribution and other factors identified below.
The parties agreed that a single approach to superannuation and non-superannuation property was appropriate. They also agreed that a holistic approach to the assessment of contributions and any adjustment thereto was just and equitable in the circumstances of this case (Horrigan & Horrigan [2020] FamCAFC 25).
CONTRIBUTIONS
I find that the initial direct financial contributions made by the wife at the commencement of the relationship were greater than those of the husband. When regard is had to the use made of those contributions (Pierce & Pierce (1999) FLC 92-844), this consideration favours the wife. The unencumbered property of the wife, albeit subject to some improvements, remains in specie. The product of the husband’s property settlement with Ms J, being the Suburb Q property, remains in specie, as does his vehicle and memorabilia. It was difficult to distil from the evidence what memorabilia the husband contributed at the commencement of cohabitation, but implicitly he held most of what he currently possesses prior to the relationship.
The wife contributed significantly greater income over the period of the relationship than the husband.
The wife’s maintenance of the husband, including the provision of a place for him to live at the 2 B Street property, while meeting his periodic expenses by way of food and accommodation, was a valuable contribution enabling him to accumulate the $103,000 applied to the acquisition of the 1 B Street property. The wife applied her pre-relationship savings of $70,000 to that acquisition.
The wife’s continued meeting of the incidental costs of the husband’s residence and living at the 2 B Street property in the later years of the relationship further weighs contributions in her favour in circumstances where the husband retained the benefit of most of his personal exertion and property rental income.
Other than indirectly by way of subsidy to the husband, the wife did not make any contributions to the Suburb Q property.
The parties made contributions to the renovations to both the 2 B Street property and the 1 B Street property within the terms of the relationship dynamic that developed between them, the husband providing physical labour and the wife meeting the costs of tradesman and materials in addition to assisting the husband in physical efforts. The evidentiary deficiencies in the husband’s case as to the particulars or value of his physical work impacts on the weight to be given to that contribution.
The wife assumed the role in undertaking the domestic tasks of she and the husband in and around the home. This factor further weighs in her favour. Both the husband and the wife contributed to the outdoor maintenance of the 2 B Street property.
Each party has contributed superannuation. The husband’s superannuation has increased from cohabitation to trial by some $105,083, and the wife’s increased by $40,821.
Family violence
The express evidence of the wife as to the discernible impact of the husband’s conduct which made her contributions more onerous and arduous than they ought to have been because the family violence he occasioned caused her to feel “very frightened and anxious” during the relationship and marriage, and that she felt like she was “walking on eggshells” because the husband would further hurt her children.
The construction of sentences and the language used in the wife’s affidavit and the affidavits of her children as to the impact of the family violence was somewhat scripted. Both the children said that they “believed” the mother to have “put on a brave face”, and that she “appeared anxious”. Both Mr F and the wife stated that she was “walking on eggshells” around the husband.
The evidence adduced by the wife did not expressly identify how the husband’s conduct made her contributions more onerous or more arduous. That impact can be inferred from the weight of the overall evidence (Boulton & Boulton (No 3) [2024] FedCFamC1F 269). Such inference is available on a consideration of all the evidence, and I so find.
That said, the weight to be attributed to this factor in this case is problematic. The wife had the opportunity to adduce particularised evidence as to the context of each event of violence, or their accumulation, and how such violence impacted on her financial, non-financial and homemaking contributions. She elected not to do so. Her children did not give evidence as to what they had observed grounding their “belief”, or how “walking on eggshells” was manifested in their observations or experience of their mothers’ presentation, or its impact on her contributions.
Additionally, in her affidavit at paragraph 86, the wife said that prior to the traumatic work event that implicitly occurred sometime in late 2017 or early 2018, she was able to perform housework and other chores “efficiently”. This impacts the weight to be given to this factor in that it further difficult to distil the impact on her contributions that were a product of the violence of the husband.
Nevertheless, a consideration of all the evidence leads to the conclusion that the husband’s conduct made the wife’s contributions more arduous and onerous by making the household environment in which they lived one that was hostile and destructive. The weighting by way of this consideration in her favour is slight.
Other matters
The wife continued to conserve and maintain the 1 B Street property after separation, absent direct contribution by the husband.
The wife received post separation $100,000 from her late uncle prior to his death, and $30,000 by way of inheritance from him. She did not explain how she applied those funds. The husband made no direct or indirect contribution to these monies. They have been exhausted. It is problematic due to an absence of evidence in the wife’s case to weigh this contribution. She received $67,000 for payment for her role as executor of the estate or by way of reimbursement of expenses she paid on behalf of the estate. She gifted these later funds to her son Mr F.
The husband made received $183,206 by way of inheritance from his late mother’s estate. The wife made no direct or indirect contribution to these monies. They have been largely dissipated by unknown use and application. The evidence in husband’s case is also deficient in this regard. However, $39,672 remains in specie as the property of the parties, being Item 37 in the balance sheet. The consideration of this contribution favours the husband.
Conclusions as to contributions
The wife sought a contribution finding as 70 per cent in her favour, and 30 per cent to the husband. The husband sought a contribution finding of equality.
It is well established that an assessment of contributions is not a mathematical exercise, but rather involves the identification and assessment of all the parties’ respective contributions across the course of the relationship and in the post separation period to the point of assessment. All contributions must be weighed collectively and not by way of so compartmentalising one against others or the remainder. Considering all the contributions identified in these reasons, contributions are assessed as 60 per cent to the wife and 40 per cent to the husband. This will see a disparity between the parties in dollar terms that equates to $2,362,993 to the wife and $1,575,329 to the husband, a difference of $787,664.
ADJUSTMENT TO THE CONTRIBUTION FINDING
The wife is 55 years old. The husband is 59 years old.
The single expert consultant psychiatrist opined, and I find, that the wife lives with a major depressive disorder and a mental health condition. The single expert consultant physician and specialist noted the wife’s significant history of anxiety, depression, and panic attacks. The expert evidence establishes, and I find, that the wife has been diagnosed with a mild medical condition and is prone to blackouts. She has been assessed for an illness, however definitive recommendations for treatment (apart from a performed surgery) are yet to be performed.
The wife does not have any current source of income from paid employment. Her workers compensation payments ceased in early 2022. She is not in receipt of Centrelink payments. She said the insurance company requires her to work 16 hours each week to ease into part-time work. She says she does not have that capacity.
The single expert consultant physician and specialist opined that it “does not appear that [the wife] could do a job requiring any sort of major physical activity”, but that she “could probably do a desk type job”. He opined that having regard to her current circumstances, he “doubt[s] that she would obtain paid employment. If she did get a job, it’s unclear whether she would be successful in the job due to underlying psychiatric and previous workforce issues”. He opined that her participation in the workforce is limited by her psychological and psychiatric conditions, not by any physical conditions. The single consultant psychiatrist concluded that the wife “does not have capacity to engage in paid employment on the open labour market.”
The wife was not asked any questions in cross-examination as to why she ceased receiving workers compensation payments. Implicitly, the evidence suggests that her refusal to work 16 hours each week generated an impasse between the wife and the workers compensation insurer concluding with the cessation of her receipt of weekly workers compensation payments, and additionally that the wife has refused to undertake psychiatric or psychological therapy. The wife gave evidence in her affidavit filed in June 2023 that she had instructed a solicitor to commence a worker’s compensation claim. She was not asked any questions as to this claim. The wife elected not to adduce updated evidence after June 2023 as to the status, or progress, of her workers compensation claim, its prospects of success, or if successful, its product, whether by way of lump sum benefit and/or resumption of periodic payments. This factor weighs against the wife.
Having regard to the whole of the evidence, I find that the wife has no current capacity for employment and that her future capacity for employment is less then optimal if she continues to refuse or neglect to undertake treatment as advised by her practitioners. It may be that in the future, with psychological treatment for her mental health challenges, she could have a limited capacity to work in a clerical or administrative position. This consideration requires further sculpting when cast against the vacuum of evidence as to the currency of, and potential values of the integers of, her workers compensation claim.
The wife lives with her three adult children. They each earn not insubstantial income. Those children have not applied any of their property, being cash at bank or shares, to contribute to the costs of the occupation of their mothers’ home. The wife said in her affidavit:
92.It is my practice to attend the supermarket and grocery shopping with [Mr F] and we pay approximately equally to the cost of groceries which is about to be at $200 per week. Both [Mr F] and contribute to the groceries. [Mr F] and [Mr E] also contribute on some occasions to the electricity account.
(As per the original)
No evidence was adduced as to why her children do not make contributions to the 2 B Street household commensurate to their capacities, save that Mr F had historically advanced monies potentially by way of a contended loan to the wife to meet household expenses. I find that the evidence of both Mr F and Ms G leads to the conclusion that they and their brother Mr E are currently significant financial resources of wife, such that support from those sources could reasonably be expected to be forthcoming if the wife were to call on it. I find that the wife’s current financial circumstances are not as dire as she contends. This is demonstrated by her capacity to gift $67,000 to her son during the currency of this litigation in late 2023.
The husband has a history of a medical condition. The single expert consultant physician and specialist opined that his current presentation is “very serious and life threatening” because he “has impaired […] function”, which “leads to [organ] failure”, and had a “[symptom]”, for which he has an implantable device. He further opined that the husband’s medical issues “significantly impair his ability to earn and engage in full-time paid employment”, but that he “could possible do some very light limited work”. As to his fitness for employment as a tradesperson, or any other occupation, the single expert opined that the husband has “virtually nil prospects”, that the husband “should consider going on the Disability Pension”, and “should consider retirement on medical grounds”.
The wife said that the husband was able to work, and that she did not agree with the evidence of the single expert, as she believed the husband has been “portraying something that he is not”, and because she had observed him on a ladder some years ago.
The husband currently continues to operate “[O Company]”. His financial statement records that he earns $750 per week from this enterprise. No evidence was adduced as to the husband not continuing to work and receive this income in the short to immediate future. I so find. That said, the expert medical evidence establishes that his longer term continued engagement in this enterprise is likely to reduce and cease in the future. I so find.
By way of contribution finding, the wife has $787,664 more property than the husband. This consideration weighs significantly in favour of the husband. Each party will retain their credit card debts identified in the balance sheet.
The husband’s conduct caused a waste by the 1 B Street property not being rented and generating income for a period of seven months (Kowaliw and Kowaliw (1981) FLC 91-092). This factor weighs in favour of the wife.
I find that neither party established to requisite degree a disclosure failure to generate a factor weighing in their favour, such that there was any income or property that had not been identified by the conclusion of the trial for the purposes of the s 79 enquiry. Agitation as to unnecessary costs being incurred in identifying the property of each party is, in this case, relevant to an exercise of discretion pursuant to s 117 of the Act, and not s 79 (Franklin & Ennis [2019] FamCAFC 91).
No evidence was adduced by either party as to the fact or quantum of capital gains tax (“CGT”) that would accrue upon the disposal of either the Suburb Q property or the 1 B Street property. The parties defined the parameters of this dispute. It is implicit, in this case, that they both contend that the incident of CGT is not a relevant consideration to the s 79 determination. Any CGT to payable will be dependent upon the circumstances of each party at the time of any disposal. If the wife retains the 1 B Street property, as she intends, any impregnated CGT will be carried with the property. Any impregnated CGT in the Suburb Q property will be carried by the husband.
The wife sought an adjustment to the contribution finding of 10 per cent in her favour. The husband sought an adjustment to the contribution finding of 5 per cent in his favour.
A holistic consideration of the matters raised above does not warrant an adjustment from the contribution finding.
CONCLUSION – JUSTICE AND EQUITY
The wife sought the opportunity to acquire the husband’s interest in the 1 B Street property. The husband insisted that it be sold because the wife did not adduce any evidence as to her capacity to pay an adjusting sum to him and then to retain it. The value of the adjusting sum the wife will pay the husband is not substantial when compared to the property she is to retain. The wife will likely call on assistance from her children to achieve that payment from their cash at bank held on trust, or from their income to, facilitate their mother’s retention of that property. The wife identifies it as an asset to produce passive investment income, in that it is producing a rental value greater than the cost of its current mortgage payment and outgoings. The husband did not identify that he would suffer any prejudice should the wife have the opportunity to acquire his interest in that property. Orders will be made to that effect.
To achieve 60 per cent of the property of the parties identified in the balance sheet, the wife ought to receive $2,362,993.
The wife currently has in her possession or will receive the following:
Ownership Description Determination ($) ASSETS 1 Joint 1 B Street, Suburb C NSW 1,300,000 2 Wife 2 B Street, Suburb C NSW 1,350,000 9 Wife Shares 4,118 10 Wife Shares 8,514 12 Wife Shares 7,735 25 Wife Jewellery wife 5,000 27 Wife Furniture 4,250 33 Wife Motor Vehicle 7 – Statutory Write off 1,650 Total 2,681,267 LIABILITIES 44 Joint Mortgage ANZ Joint (1 B Street) 261,857 48 Joint Land Tax – 1 B Street 8,408 53 Wife Queensland Government Debt 2,800 Total 273,065 TOTAL ASSETS – LIABILITIES $2,408,202 SUPERANNUATION Member Name of Fund Type of interest Determination ($) 58 Wife Superannuation Fund 1 Accumulative 30,262 59 Wife Superannuation Fund 2 Accumulative 35,559 Total 65,821 TOTAL NET SUPERANNUATION + NON-SUPERANNUATION $2,474,023
If she has the property in the table above, she achieves $111,030 greater than her 60 per cent entitlement.
The husband’s overall entitlement to 40 per cent of the property of the parties identified in the balance sheet equates to $1,575,329.
Pursuant to the orders, the husband has or will receive the following:
Ownership Description Determination ($) ASSETS 3 Husband P Street, Suburb Q 1,200,000 16 Husband Motor Vehicle 4 14,528 17 Husband Motor Vehicle 3 19,500 18 Husband Motor Vehicle 5 750 19 Husband Trailer – steel enclosed 1,000 20 Husband Motor Vehicle 6 5,795 21 Husband Business – O Company 15,000 23 Husband Sports Memorabilia autographed 20,000 24 Husband Household effects 5,000 26 Husband Jewellery and watch collection husband 3,570 28 Husband S Bank 1,250 36 Husband ANZ A/C …68 15,386 37 Husband Westpac A/C …00 39,672 Total 1,341,451 ADDBACKS 40 Husband Joint monies taken by husband from Offset account for his personal use after separation in 2019 – 2020 3,000 Total 3,000 LIABILITIES 49 Husband Westpac Home Loan Suburb Q property 36,503 57a Husband Land Tax – Suburb Q 6,790 Total 43,293 TOTAL ASSETS – LIABILITIES $1,301,158 SUPERANNUATION Member Name of Fund Type of interest Determination ($) 60 Husband Superannuation Fund 3 Accumulative 163,141 Total 163,141 TOTAL NET SUPERANNUATION + NON-SUPERANNUATION $1,464,299
The husband accordingly currently holds $1,464,299. He ought to hold $1,575,329. Hence, the wife must pay to the husband $111,030, rounded down to $111,000.
The wife ought to be afforded some time to raise the funds to pay to the husband. A period of three months should be sufficient. I will so order. In the event the wife fails to pay the husband $111,000 within that specified period, orders will be made for the sale of the 1 B Street property in the terms as broadly sought by the wife regulating the process of sale of the husband’s Suburb Q property, if that sale was required. The wife cannot be heard to complain as to the construction and method of such orders in circumstances where she implicitly promoted them as just if they applied to the husband. The husband will receive 10.7 per cent of the net proceeds of sale of the 1 B Street property, if sold, calculated from its current equity of $1,038,143 (being $1,300,000 less the mortgage of $261,857 – the $111,000 due to the husband equates to 10.7 per cent of that equity). Orders will be made in such terms. For the reasons identified, each party will pay their own assessed CGT incurred upon the disposal of the 1 B Street property as and when it falls due.
Standing back, I find the distribution of the property of the parties in the terms identified above is appropriate and otherwise just and equitable. Orders will be made accordingly.
During the trial rumblings were murmured as the costs sought because of contended unnecessary forensic processes during the litigation and potentially grounded from offers made to compromise the substantive proceedings. It is appropriate for the parties to have an opportunity to agitate those applications should they be so advised.
I certify that the preceding one hundred and sixty-one (161) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Campton. Associate:
Dated: 21 August 2024
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