Braidwood and Winlow

[2018] FCCA 1579

FEDERAL CIRCUIT COURT OF AUSTRALIA

BRAIDWOOD & WINLOW [2018] FCCA 1579

Catchwords:
FAMILY LAW – Property dispute – parenting issues to be determined later – whether debts at date of separation should be included – Court finding that only divisible assets are parties superannuation – wife having care of two children on ongoing basis – division of parties total superannuation 60/40 in favour of the wife just and equitable.

Legislation:

Family Law Act 1975

Cases cited:

Stanford v Stanford [2012] HCA 52

Omacini & Omacini (2005) FLC 93-218

Applicant: MS BRAIDWOOD

Respondent: MR WINLOW

File Number: DGC 2086 of 2017

Judgment of: Judge Burchardt

Hearing date: 3 May 2018

Date of Last Submission: 3 May 2018

Delivered at: Dandenong

Delivered on: 12 July 2018

REPRESENTATION

The Applicant: In person

The Respondent: In person

ORDERS

1. That in relation to the Husband’s accumulation component of his superannuation interest in Employer Superannuation Scheme (“the Fund”) the Trustee of which is (“the Trustee”).

   (a)There be an allocation for the purposes of Section 90MT(4) of the Family Law Act 1975 of a base amount of $113,902 from the Husband’s accumulation component in the Fund, to the wife, Ms Braidwood;

   (b)That pursuant to Section 90MT(1)(a) of the Family Law Act 1975, whenever a splittable payment becomes payable in respect of the husband’s accumulation component in the Fund, Ms Braidwood shall be entitled to be paid an amount calculated in accordance Part 6 of the Family Law (Superannuation) Regulations 2001 using the base amount of $113,902 pursuant to subclause (a) hereof of these Orders and there shall be a corresponding reduction in the superannuation interest of the husband to whom such a splittable payment would have been made but for this Order;

   (c)That paragraph 1(b) of these Orders shall take effect from the Operative Time, being the fourth business day after the date on which a certified sealed copy of this Order is served upon the Trustee of the Fund;

   (d)That having been afforded procedural fairness in relation to the making of this Order, this Order binds the Trustee of the Fund;

   (e)That the Trustee of the Fund and the parties in accordance with the obligations set out under the Family Law Act 1975, the Family Law (Superannuation) Regulations 2001 and the Superannuation Industry (Supervision) Act and Regulations 1994, shall do all such acts and things and sigh all such documents as may be necessary to calculate the entitlement of and make the payment to Ms Braidwood in accordance with this Order;

   (f)That each party and the Trustee has liberty to apply, on not less than three (3) business days’ notice, in respect to the implementation of the super splitting orders.

2. That within 28 days of this Order being made:

   (a)Ms Braidwood shall serve a copy of this Order upon the Trustee of the Fund;

   (b)Ms Braidwood shall serve a Notice upon the Trustee of the Fund pursuant to Regulation 72 of the Family Law (Superannuation) Regulations 2001.

3. That Mr Winlow be and is hereby restrained by himself, his servants and/or agents from executing a Binding Death Benefit Nomination in favour of any person or doing any act or thing that would render any part of his accumulation interest in the fund a non-spittable payment within the meaning of Regulation 12 of the Family Law (Superannuation) Regulations 2001 AND the Trustee of the Fund is ordered to give effect to this Order. 

4. That unless otherwise specified in this Order except for the purposes of enforcing payment of any money due under these or any subsequent Orders:

   (a)Each party shall be solely entitled to the exclusion of the other to all property in the possession of such party as at this date. 

   (b)Monies standing to the credit of the parties in any bank accounts to be the property of the party in whose name such bank account is held.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT DANDENONG

DGC 2086 of 2017

MS BRAIDWOOD

Applicant

And

MR WINLOW

Respondent

REASONS FOR JUDGMENT

Introductory

1. This is the property component of a dispute between two self-represented litigants.  The parenting dispute, which is well and truly alive before the Court, will be heard in September 2018 with the assistance of an Independent Children’s Lawyer.  The self-representation of the parties has given rise to a number of obvious potential forensic difficulties.

2. The applicant de facto wife’s position is that there should be a superannuation splitting order made such that 70 per cent of the husband’s superannuation vest in her superannuation fund.  The responding position of the respondent de facto husband is that there should be a division 60/40 in his favour of superannuation interests.  I note that the respondent’s position is that the superannuation split should be effected with the value of the parties’ superannuation as at the date of separation.  He further seeks an apportionment of debts as at the same date.

3. For the reasons that follow, I think that superannuation should be approached on the footing as it stands now.  There are no debts relevantly to divide.  Each party should retain such chattels as they have in their possession.  There should be a superannuation splitting order that adjusts the overall position of the parties as to 60 per cent in favour of the wife and 40 per cent to the husband.

Agreed or uncontroversial matters

1. The wife was born on 1980 and the husband was born on 1980.  They commenced to date one another at a very young age, and commenced cohabitation in 1998.  In 2002, they bought a house in Suburb A, which was ultimately sold with a net profit of $10,000 which has since been dissipated.

2. In 2004, the husband commenced service in the (employer omitted), and remained in that service until 2015.  The parties, having lived some years around Australia pursuant to the husband’s various postings, returned to Victoria in 2015. They separated it seems in July 2015.

3. The parties have two children, [X], born 2005, and [Y], born 2010.  The wife worked until [Y] was born in 2010.

4. The wife is now a student working part-time as a (occupation omitted), earning approximately $250 per week with Centrelink payments of $585 per fortnight.  She owns a car of no discernible worth, and has disclosed $41,034 of superannuation in her affidavit filed July 2017.

5. The husband has, it is I think common ground, a number of injuries and conditions.  He says that in most cases these are degenerative physical conditions resulting from his service in the (employment omitted).  He is working full-time as a (occupation omitted).

6. The wife lives in a home wholly owned by her parents.  She has refused Child Support from the husband.

7. The husband has a property in Property A, about which very little has been said.  He proposes to move to it in 2018.

The parties’ affidavits

1. The vast bulk of the parties’ affidavit material goes to parenting issues which are hotly contested, including assertions, vividly denied by each of the parents, as to family violence allegedly inflicted by the other.  Those matters will plainly have to await the parenting dispute in September.  Neither side’s material rises to the level of a Kennon argument.  Most of the material matters as to property issues are described in the materials above.

The submissions and evidence at Court

1. When the proceeding was first called, Mr Winlow sought an adjournment.  He asserted that full and frank disclosure had not been provided by the wife.  The wife denied this, and said all relevant information had been provided.  I ruled against the application for an adjournment for reasons then given.  It should be noted that it was clear to me that an adjournment was most unlikely to produce any greater certainty as to the parties’ circumstances.  This is all the more the case given that Mr Winlow has asserted that property and chattels were likely to be of nominal value.

2. When the proceeding commenced, Ms Braidwood indicated that she had provided copies of all her superannuation accounts, and there were no others.  She asserted that Mr Winlow had sold some of the chattels, that it was him who had kept the expensive ones.  She had kept items such as the couch.  She proposed that each party retain their own chattels.

3. Ms Braidwood asserted that she had paid an actuary to prepare an analysis of the respondent’s superannuation, and tendered as exhibit A1 a report from (omitted).  This assessed the value of Mr Winlow’s superannuation as at 30 June 2015 (close enough to make no difference to the date of separation) of $191,167, and as at 6 April 2018, of $221,218.  She also tendered as exhibit A2 documents purporting to show a consolidated superannuation account in her favour of $47,072.55 as at 19 November 2017.

4. Ms Braidwood asserted that Child Support was not paid.  She pays for all school costs.  She has borrowed from her parents.  She rents from her parents.  She pays rent for the premises she lives in.

5. When sworn, Ms Braidwood was cross-examined by Mr Winlow.  She said that she has a partner who rents the back of the property at which she lives.  She pays all her costs.  Her parents have assisted with the children’s extracurricular activities.  Her parents have set the rent on the property.

6. When it was put to her that she had caused payments of Child Support to cease, Ms Braidwood said that the husband had paid $15 to $30 per month in Child Support.  He was money hungry.  Her parents do not have a will and are turning 60 this year.  She has one other brother.  Her superannuation has been consolidated into Super Fund 1.

7. So far as chattels are concerned, the husband has SCUBA equipment worth $20,000.  He kept his skydiving parachute, a pool table, a gun safe, fish tanks and camping equipment.

8. When it was put to her that there was a debt to a leased vehicle at the time of separation, Ms Braidwood said she was not aware of this.  She did not drive it.  She handed the key back.  He had chosen to buy it.  He resigned from a good job in the (employer omitted).  She believed that she had made full and frank disclosure.  Her husband paid two lots of $500 before she left the (employer omitted) property.  He did not allow her to move.  After separation he provided no assistance.  In the end, her father paid for the removal.

9. In re-examination, such as it was, Ms Braidwood said that all the debts the husband presently has arise from his leisure activities.

10. I would interpolate and say that the wife was a palpably honest and responsive witness.

11. Mr Winlow made a relatively extensive opening, and indeed was not the subject of cross-examination.  He said he had done everything to try and agree.  There was only superannuation to split, and it should be split 60 per cent to him and 40 per cent to the wife.  The liabilities would equalise superannuation.  There should be an apportionment of debts as to 60 per cent to him and 40 per cent to the wife.  He had left his job in the (employer omitted) because the wife degraded his working relationships.  He had paid Child Support.  He had paid $250 per fortnight when working full-time, but then she applied to stop his Child Support.  He was unable to continue it.  She could reactivate Child Support.  His income has reduced since leaving the (employer omitted), and he now does casual work.  His income will not increase.  He has one child living with him at the moment.  He is not now in a relationship, but is co-parenting his daughter.  He requested that earnings post-separation be removed from the (employer omitted) super, which would be, he believed, worth $15,000.  Contributions to Superannuation should also be omitted, as they were post-separation.

12. He handed up a set of proposed minutes, which I marked as I1.

13. (It should be noted this appears most unfortunately to have been lost, but nothing turns on this as I have set out the husband’s position in this judgment).

14. In final submissions, Ms Braidwood confirmed that she was seeking 70 per cent of the husband’s superannuation, and to retain her own superannuation.  She submitted that the husband should still remain responsible for the debt caused by excessive spending on himself during the relationship.  She referred to family violence.  Her earning capacity was low, and the children had been badly affected by the home environment.

15. Mr Winlow said he sought a total split of superannuation 60/40.  He denied family violence.  He said the parties’ earning capacity was similar, except that she had the primary care of the children.  He disagreed the debt was accumulated by him.  The wife had her own credit card as well as his.  He had a mental breakdown.  He had put a new engine into the wife’s car, and she wanted him to pay for it.  He had to give back a lease car which cost him $20,000.  He had to buy a car himself, and he said he was likely to become bankrupt.  He said he owns property in Property A, but has no capacity to pay.  This was brought two years after separation.  Superannuation was equal.  Contributions were equal.  He conceded that the wife worked until the second child was born in 2010.

16. It should be noted that although the husband continued to complain about the wife’s non-disclosure, he gave no meaningful details as to exactly what had not been disclosed.  I should record that the husband’s opening was indicative of a strongly obsessive personality, and I regret to say that a fair amount of what he had to say (I have done my best to paraphrase it) was almost incomprehensible.

Findings on the Facts

1. There is no dispute that the parties were in a relationship from 1998 (or possibly 1997) until 2015.  This was a long relationship.  It has produced two children who live primarily with the mother and, indeed, the children have not seen the father for several years.  They are in the process of establishing contact through the Family Life Contact Service at Suburb B pursuant to interim orders made on 30 January 2018.

2. The husband worked throughout the relationship and the wife worked until 2010 when [Y] was born.  The parties, no doubt, both contributed as best they were able. 

3. There is a dispute on the materials as to the extent to which the husband was involved in the upbringing of the children.  It is not possible, in view of the way the evidence and submissions proceeded, to form any very definite conclusions as to this aspect of the matter, which will doubtless be revisited in the parenting hearing.  Nonetheless, there is no question that the wife was always and remains the primary carer. 

4. The parties appear to have spent what they earned as they went and, as things now stand, all there is left to deal with in meaningful terms is the parties’ superannuation.

Stanford v Stanford [2012] HCA 52

1. The Court’s first task is to ascertain the legal and equitable interests of the parties and determine whether it is appropriate that there be a property adjustment.  Here, as in so many cases, the basis on which the parties conducted their financial affairs during the relationship has radically altered and the reality is that both sides desire a property adjustment.  It is plain there should be one.

The Pool

1. The pool consists of the parties’ superannuation.  I am not prepared to include the wine alleged to be owned by the wife.  It is of minimal value in the scheme of things.  The husband’s desire to include it shows his hyperconcentration on minor matters.

2. I do not include the property in which the wife lives.  Her evidence is that she is paying rent at an appropriate rate to her parents, and I accept this.  I, likewise, accept that her partner pays rent for living in the other building on the property on which she lives, and that they do not commingle their finances.

3. I note that the husband possesses a property in Property A, which his Financial Statement values at $128,500 with a mortgage of $114,224.  His Financial Statement also discloses debts to Bank Credit Card of $30,000, Mastercard, $6,055, and Credit Card, $10,000.

4. The husband values his Holden Commodore at $5,500, but there is no expert of sworn evidence to substantiate that valuation.

5. The wife’s Motor Vehicle is, likewise, not valued.

6. In circumstances where the evidence makes it impossible to make any positive findings as to the debts which the husband says accrued during the relationship, and which the wife either denies or says were wholly the result of the husband’s profligacy, I do not think it is possible properly to include those debts as part of the pool.  Separation is now almost three years ago, and, in my view, what debts there were have just been overtaken by events.

7. The next question is to determine what proportion of the parties’ superannuation should be included in the pool.  The wife’s superannuation, doing the best one can, is the $47,072 disclosed by exhibit A2 as at 19 November 2017.  The husband’s, as at 6 April 2018 is $221,218.  In the scheme of things, it was not so very much less on 30 June 2015 when it was worth $191,167.

8. It is well established that, generally speaking, the Court approaches property issues as at the date of the Court hearing and decision (see Omacini & Omacini (2005) FLC 93-218 at [16]). That is because the Court is seeking to produce orders that are just and equitable, both in respect of past events and in respect of future events.

9. In this case, the husband commenced his employment with the (employer omitted) some five years after cohabitation commenced.  His service with the (employer omitted) ended at or about the time of separation. Clearly the vast bulk of the parties’ superannuation was derived during the relationship.  It is plainly appropriate that the post-separation contribution should be included because to do otherwise would distort, and indeed wholly ignore, the future needs component as part of the Court’s decision.  This, in my view, is a just and equitable approach to this particular sub-issue.

Contributions

1. In this case, bearing in mind that I am unable to make findings as to the assertions as to family violence (neither side meaningfully cross-examined about these issues, and indeed the husband was not cross-examined at all), I would regard the parties’ contributions as equal.  They both worked.  The wife was the primary carer for the children.  The reality is that their endeavours have not been very productive, or indeed productive at all, in terms of their current financial outcome.  Their contributions should be assessed as equal.

2. It should be noted that I am not including the husband’s Property A property, which has only minimal equity and which is in an entirely post-separation asset. 

Future Needs

1. Here, the position is, once again, rendered more difficult by the absence of proper forensic examination of the various competing claims.  It does seem plain that the wife will have the ongoing primary care, at the very least, of the two children.  Given their relatively young age, this will last for a considerable time.  Against this, however, the husband has asserted a number of degenerative conditions associated with his work, and his evidence suggested that this was indeed the case.  There is, however, no objective medical evidence to support his assertions.

2. Doing the best I can in this sparse evidentiary landscape, I would make an adjustment in favour of the wife of some 10 per cent.

Just and Equitable

1. The unusual aspect of this case is that all there is to adjust is the superannuation.  I am going to order that each party remain solely responsible for any debts in their sole name.  To the extent that this might be thought to visit an unfairness on the husband, because he may be left with some of the debts of the relationship, it should be noted I have excluded his property in Property A, which, while a wholly post-separation asset, nonetheless, is indeed an asset in his hands.  His Financial Statement discloses that it is rented for some $200 per week.

1. Neither of these parties will, subject to hardship application, be able to access their superannuation for quite some time.  The notions of contribution and future needs do not fit, in some ways, so easily with an asset such as superannuation which cannot be realised for quite a lengthy period of time.  Nonetheless, and doing the best I can in these unusual circumstances, I think that an order that the parties’ superannuation be adjusted so that the total of their combined superannuation be divided as to 60 per cent in the wife’s superannuation fund and 40 per cent in the husband’s superannuation find. This is in any view a just and equitable outcome.  The wife’s claim to retain her own superannuation and have 70 per cent of the husband’s is plainly grossly exaggerated and unwarranted.  Likewise, the husband’s 60/40 proposal in his own favour is unduly parsimonious.  These matters always involve measures of impression and judgment.  In my judgment the 60/40 split in favour of the wife is appropriate.  I have drafted orders to give effect to these conclusions, but plainly, the identity of the husband’s superannuation fund will need to be more precisely revealed and the trustee will need to be given procedural fairness before final orders can be made. 

I certify that the preceding forty-seven (47) paragraphs are a true copy of the reasons for judgment of Judge Burchardt

Date: 12 July 2018