Bradman and Bradman

[2018] FCCA 1789

FEDERAL CIRCUIT COURT OF AUSTRALIA

BRADMAN & BRADMAN [2018] FCCA 1789

Catchwords:
FAMILY LAW – Property dispute restricted to parties’ sole remaining asset, namely husband’s superannuation – wife seeking equalisation of superannuation – husband resisting any adjustment at all – just and equitable in all the circumstances that wife receive 30 per cent of the husband’s superannuation.

Legislation:

Family Law Act 1975

Cases cited:

Mallett & Mallett (1984) 156 CLR 605
Stanford v Stanford [2012] HCA 52

Applicant: MS BRADMAN

Respondent: MR BRADMAN

File Number: DGC 1700 of 2016

Judgment of: Judge Burchardt

Hearing dates: 19 & 20 April 2018

Date of Last Submission: 20 April 2018

Delivered at: Dandenong

Delivered on: 13 July 2018

REPRESENTATION

Counsel for the Applicant: Mr Stanley

Solicitors for the Applicant: National Family Lawyers

The Respondent: In person

ORDERS

1. That Pursuant to section 90MT(1)(b) of the Family Law Act 1975, whenever a splittable payment becomes payable from the superannuation interest held by Mr Bradman (member spouse) in the Superannuation Scheme, the Trustee shall pay to Ms Bradman (non-member spouse) 30% of each splittable payment and there be a corresponding reduction in the entitlements the member spouse would have had but for these orders.

2. That the Trustee of the Superannuation Scheme “the Trustee”) shall do all such acts and things and sign all such documents as may be necessary to:

   (a)Calculate, in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001, the entitlement created by clause 1 of this order; and

   (b)Pay the entitlement whenever the Trustee makes a splittable payment out of the husband’s interest in the Superannuation Scheme.

3. That the operative time for these orders is four business days after the service of the final sealed orders on the Superannuation Board.

4. That the non-member request the Trustee of the Superannuation Scheme to create a new interest, rollover or transfer the transferrable benefits out of the member’s superannuation interest in accordance with the requirements of the Superannuation Act 1976.

5. That there be liberty to apply to each party and the Trustee in relation to the implementation of the order affecting the superannuation interest.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT DANDENONG

DGC 1700 of 2016

MS BRADMAN

Applicant

And

MR BRADMAN

Respondent

REASONS FOR JUDGMENT

Introductory

1. This is a property dispute rendered all the more sad by the fact, as counsel for the applicant wife correctly submits, that all there is left to divide is the husband’s superannuation.  It should be noted that I am referring to the parties as husband and wife for convenience, albeit that they were divorced on 10 August 2016.

2. There are really no significant factual disputes whatsoever between the parties.  It is simply a matter of whether, as the wife seeks, the husband’s superannuation be divided evenly between the parties or whether, as the husband seeks, he retain all of it.

3. For the reasons that follow, I am going to make a splitting order that will have the effect of vesting 30 per cent of the husband’s superannuation in the wife.

Agreed or Uncontroversial Facts

1. The husband was born on 1972, and the wife was born on 1973.  They commenced cohabitation in 2002 and married on 2007.  They separated on or 30 May 2013.  As earlier indicated, a divorce order was made on 11 August 2016.

2. Their children [X] and [Y] were born on 2002 and 2008 respectively.  The children live with the mother.

3. It is common cause that the wife brought into the marriage a $20,000 settlement arising from an earlier claim, which arose out of a botched surgical episode.  She also brought in a not insubstantial tranche of shares variously referred to, I think, as being either $30,000 or $55,000  The disparity is not important because it is apparent that all those shares, whatever their value, are gone and the proceeds thereof applied to the general wellbeing of the family during the marriage.

4. Additionally, although the husband says he was unaware of it, the wife was given in excess of $229,000 from her parents’ Family Trust during the years from the commencement of the relationship until 2011.  She was further given substantial additional funds by her mother.

5. The wife had a HECS debt at the commencement of the relationship which has substantially increased and is now of the order of some $57,000.

6. The wife works at (employer omitted) as a (occupation omitted) and earns approximately $80,000 a year in that regard.

7. The wife was formerly in a relationship but is now single.  The husband is now in a relationship, but the extent of cohabitation is not entirely clear.

8. The husband worked as a (occupation omitted) between 1995 and 2014.  Thereafter, he worked at the (employer omitted) until 2018 receiving a salary of $250 per week, which is augmented by $850 per week payment from the Superannuation Board and Superannuation Fund.

9. The husband is now seeking work either with (employer omitted) or as a (employment omitted).  Curiously, there is no direct evidence, as far as I can see, as to exactly what the state of the husband’s health is.  He does say inter alia in paragraph 5 of his affidavit filed on 9 April 2018:

   “My medical issues have prevented me from performing 2 or 3 other jobs I have applied for or gained over the last few years.  They also prevented me from completing a diploma which I started in 2016.”

10. Whatever the circumstances may be, the only inference I can draw, given that the husband is in receipt of a superannuation pension at the age of only 46, there must be some significant health disability on his part.

11. Finally, it should be noted that the parties have to their credit resolved parenting issues between them by consent orders made on 19 April 2018.  The children live with the mother and spend a relatively limited amount of time with the father.

The Evidence Given at Court (taken from my notes)

1. Counsel for the applicant opened his case on the footing that there was only superannuation left to divide.  He pointed to the considerable financial contributions of the wife including the $20,000 compensation payment, the shares worth approximately $55,000 from her parents, the distributions from the Family Trust each year until 2011 in excess of $229,000 and cash in substantial amounts and likewise until 2011.  He noted that the wife works as a (occupation omitted) at (employer omitted) and that the husband is in receipt of a disability pension.  He submitted there should be an equal division of superannuation.

2. The wife was called and confirmed her occupation as a (occupation omitted).  She has recently separated from her partner.  She has taken a six-month lease on a new property.  She is working on her relationship with her former partner.  She had taken some (employment omitted) work at (employer omitted) to augment her income.

3. Under cross-examination by Mr Bradman, who represented himself, the wife said she was not sure if all his pay had gone into the joint account.  She never saw any payslips or followed things up.  Her trust funds went into the Bank account and went on food and clothing for the children.

4. In 2011, the wife decided to stop the payments from the trust.  She returned the trust car.  She explained that she had made a conscious decision to cease contact with her family as a result of abuse earlier in her life.  She is estranged from her parents at the present time.

5. The wife reluctantly agreed that the husband had paid for [Y]’s orthodontics in the sum of $3,000.  He had also paid Child Support as assessed since separation.  When separation first took place, he had made very reasonable contributions but in the last two years has just paid Child Support.

6. I would interpolate and say the wife was most reluctant to give the father credit for anything at all.

7. The wife confirmed that her HECS debt was $30,000 at the end of the relationship.  She is a (occupation omitted).  Full time would be about $80,000 per year.  There is no way the children could do what they do if she was full time.  She presently earns about $65,000 per year.

8. Both children are at school full time.  The father picks them up on three nights out of 10.  The mother gave details of the childrens’ extracurricular activities which supported her decision to work, as she does, three to four days.  She says three to four days work per week was a good balance for being a mother.  In re-examination and without objection, the mother tendered exhibits A1 and A2 showing the husband’s superannuation interests as at 1 March 2002, 30 May 2013 and as at 17 April 2018.  The latter figure is $855,337.55.

The Evidence and Submissions of the Husband

1. The husband said he cannot work full time.  His income is from his disability pension.  He said that superannuation should only be valued as at the end of the relationship.  The sum concerned is to last him for the next 20 years.  He surmised that it might be possible to adjourn the proceeding to some point in the future.

2. Once sworn, the husband confirmed that he is a retired (occupation omitted).  His part-time employment following separation finished a couple of months ago.  He has two options on the go: his training for (employer omitted), and he has trained for (employment omitted) at (employer omitted).  His pension may be the subject of financial review.

3. Under cross-examination, the husband confirmed that separation took place in about June 2013.  [X] was then 10, and [Y] was 5.  They have lived mainly with the mother since then.  He accepted that the wife had contributed $20,000 of compensation to the relationship.  He also accepted the $55,000 of shares.  He accepted the funds distributed through the mother’s Family Trust and conceded that tens of thousands of dollars were provided to the wife by her mother additionally.  A company vehicle was provided which was paid for by the wife’s stepfather.

4. The husband conceded that he is a keen (hobby).  He competes nationally.  International competition was a long time ago.  Sometimes they took the children, and sometimes he left them with the wife.

5. He has a daughter Ms R, aged 24, who attended a private school.  This was not School B but a school, the School A.  The fees were nowhere near School B and not $10,000 a year.

6. The husband conceded that he had been a heavy drinker for some of the time during the relationship.  He does not drink now.  He has been diagnosed with mental health problems.  He said all his children were very smart.  He gave evidence about the extracurricular activities for the children.  They were good children.  He gave the wife credit for this.  He said both had done a good job for the children.  His training with (employer omitted) would see him based at Suburb K.  He ceased to work at (employer omitted) on 2018.  His (employer omitted) training was two and a half weeks ago. 

Closing submissions by counsel for the wife

1. Counsel submitted that the husband’s superannuation can be split.  Counsel pointed to s 90MT(2)(a) and further noted that superannuation interests are property by virtue of s 90MC(1). 

2. Counsel submitted that this was an 11-year marriage and that the wife would have primary care of the children for 16 years.  It was submitted there must be an adjustment.  The wife will retain her HECS debt.

3. Insofar as contributions were concerned, counsel submitted that the wife had been the primary carer of the children.  The husband had undertaken shift work and was drinking with other employees.  He had his (hobby) activities.  Counsel submitted that, in accordance with the decision of the High Court in Mallett & Mallett (1984) 156 CLR 605, the Court should not give merely token weight to the wife’s homemaking contributions.

4. In terms of financial contributions, counsel pointed to the $20,000, the car provided by the Trust, the $55,000 in shares, and the Trust distributions in cash.  It was submitted that these would favour an adjustment in favour of the wife, notwithstanding that it was conceded that the husband’s health is poor and his future employment uncertain.

5. In terms of the future needs factors, counsel submitted that the wife will be caring for the children.  She works when the children are with the husband and has to grab a shift where she can.  She has only $14,000 superannuation.  Even if the Court were to find that the future needs factors favour the husband, the contribution matters would still make an overall adjustment of 50 per cent of the superannuation interests fair and reasonable.

The submissions of Mr Bradman

1. Mr Bradman submitted that he has income from his pension and is completely dependent upon it.  His work prospects are not so great, but the wife can work full time.  He conceded that the wife had had the primary care of the children and conceded her financial input.  He asked the Court to consider his capacity to put a roof over his head. 

Stanford v Stanford

1. The husband’s position, in truth, is that there ought not be any adjustment of the parties’ financial affairs.  In my view, however, this is not a sustainable outcome.  The parties’ assets and liabilities are put in largely identical terms in the parties’ case outlines.  The wife’s car, and that of the husband, are not the subject of expert evidence and, in my view, cancel each other out in any event.  The parties’ chattels are likewise not valued and likewise should not be included.  Although the husband has asserted that the wife has an engagement ring worth $5,000, no evidence was led as to this, and I will not include that in the assets and liabilities.  The liabilities are the husband’s personal loan, in the sum it would seem, of some $7,500 (wife’s estimate) or $6,500 (husband’s estimate).  The wife has a HECS debt, which I accept now stands at $57,000.

2. The husband’s superannuation as of 17 April 2018 is $855,337  He additionally has other superannuation which he estimates, as does the wife, at $6,000, and the parties are at one that the wife’s superannuation is worth $14,236.

3. According to exhibit A1, the husband’s superannuation cannot be measured at 1 March 2002 but was worth $920.42 at 30 June 2001.  The value attributed to it as at 1 March 2002 by exhibit A1 is $12,973.  The value attributed to the superannuation as at 30 May 2013 was $73,714.

4. There is no evidence, let alone actuarial evidence or similar evidence, to explain the enormous increase in the husband’s superannuation in the period from 2013 to 2018, this of course being entirely a post-separation period.  I note that the husband ceased work as a (occupation omitted) in 2014.  There is nothing to suggest that the husband himself made any significant additional contributions during this period.  Rather, he has lived, in large part, on his disability pension throughout this latter period.

5. In the circumstances, the conclusion that the husband’s superannuation largely accrued in any meaningful sense during the period of the marriage is irresistible.

6. In circumstances where the marriage lasted for 11 years and the wife made significant contributions both in child-rearing and in direct financial contribution terms, it would plainly not be just and equitable for there to be no property division.

The Pool

1. As I have already indicated, the pool consists meaningfully, in my view, of the parties’ superannuation.  The wife will have to retain her HECS debt, which is very substantially greater than the husband’s ongoing personal loan.  It is entirely appropriate, therefore, that the Court consider the parties’ superannuation.

Contribution Issues

1. The husband himself acknowledges that the wife was the primary carer of the children from the time of their birth until separation, and indeed remains so.  The husband undoubtedly contributed to an extent from time to time, but I note his concession that there were periods of time during his work as a (occupation omitted) where he was drinking heavily with his colleagues.  In addition to the primary care of the children, of course, the wife made very significant additional financial contributions.

2. I would assess the overall contributions of the parties as being 65 per cent to the wife and 35 per cent to the husband.

The Parties’ Future Needs

1. Here the position is stark.  The wife has a qualification as a (occupation omitted) and what appears to be secure ongoing employment.  She will be able to work full time when the children finish school.  Her likely income will be very substantially greater than that of the husband.  Her health is unremarkable.

2. Although shrouded to an extent in some mystery, there is no dispute that the husband’s health is not good.  He is, after all, in receipt of a disability pension and has asserted, without contradiction, that he has mental health problems.  His employment prospects are uncertain at best and would appear to be only in particular fields of employment that are not likely to be at all well paid.  In truth, his disability pension is his only significant asset.  The wife will, of course, have the largely full time care of the children, together with the responsibility of paying for them in large part until 2025 when [Y] turns 18.

Just and Equitable

1. This is an unusual case turning on a very specific set of facts.  I do not think that it is appropriate to go through a precise balancing of the contributions and future needs issues.  That is because I have formed the view that the fair and just outcome of this proceeding is that the wife receive a split of 30 per cent of the husband’s superannuation.  Although the wife has superannuation of some $14,000, which is greater than the husband’s non-employer superannuation of $6,000, these are trivial amounts in the scheme of the totality.  It is the Superannuation that the Court is, in truth, essentially concerned with.  I retain no doubt that the Court has power to make the orders that the wife seeks.

2. Although the Court has not, insofar as I can see, been provided with it, there is, as I understand it, no challenge to the assertion at page 4 of the wife’s case outline that “Superannuation has been provided with procedural fairness and has approved the orders in the form set out below”.

3. I accept that the Court has power, pursuant to s 90MS of the Family Law Act 1975, to make orders in relation to superannuation interests of the spouses.  As the wife’s outline of case makes plain, “superannuation interests” is defined in s 90MD as being “an interest that a person has a member of an eligible super fund, but not include a reversionary interest.”  The husband’s disability pension is not a reversionary interest.  The payment to the wife is a splittable payment within the meaning of s 90ME, and as earlier indicated, s 90MT and 90MC support the proposition that the Court has power to make the orders sought.

4. In my view, the just and proper outcome is that the wife should receive, as I say, 30 per cent of the employer superannuation.  This will give the wife, in my opinion, a just and equitable outcome in light of the very differing circumstances in which she and the husband find themselves.  I am prepared to accept that, at least for the foreseeable future, the wife will not reconcile with her family and, thus, access substantial amounts of money from them.  Nonetheless, she is in receipt of a far better wage and will, in the relatively near future, have the opportunity to work full time. 

5. The husband will, if he works full time at all, be poorly paid and have to deal with his ongoing health difficulties, such as they may be.  These are the factors that, in my view, militate in favour of the division I have proposed.  It is true that the wife made the greater contribution during the relationship, but that contribution does not appear to have found effect in the creation of any particular asset.  Indeed, it is surprising that the wife’s HECS debt has gone steadily upwards despite the accrual of funds from time to time.  The obvious conclusion is that the parties spent what they got as they got it.  This is not irrelevant to the ultimate outcome. 

1. I have prepared draft orders to reflect these conclusions and will hear from the parties once they have had an opportunity to read them.

I certify that the preceding fifty-one (51) paragraphs are a true copy of the reasons for judgment of Judge Burchardt.

Date: 13 July 2018