BRITT & BRITT

[2015] FCCA 685

FEDERAL CIRCUIT COURT OF AUSTRALIA

BRITT & BRITT [2015] FCCA 685

Catchwords:
FAMILY LAW – Property – 30/31 year relationship/marriage – main asset a farm which the husband wishes to retain – whether and to what extent money received by the wife since separation should be taken into account in calculating her entitlement to a property settlement – whether the wife has made out a “Kennon” claim – whether there should be an adjustment in favour of either party for s.75(2) matters.

Legislation:

Family Law Act 1975, ss.75, 79

Gosper & Gosper (1987) FLC 91-818
Kennon & Kennon (1997) FLC 92-757
Kowaliw & Kowaliw (1981) FLC 91-092
Stanford & Stanford (2012) 247 CLR 108
Williams & Williams (2007) FamCA 313

Applicant: MS BRITT

Respondent: MR BRITT

File Number: SYC 3351 of 2012

Judgment of: Judge Terry

Hearing dates:

10, 11, 12, 13 March 2014 and

29 August 2014

Date of Last Submission: 29 August 2014

Delivered at: Newcastle

Delivered on: 30 March 2015

REPRESENTATION

Counsel for the Applicant: Mr Hodgson

Solicitors for the Applicant: Sorensen & Brown

Counsel for the Respondent: Ms Christie

Solicitors for the Respondent: Everingham Solomons Solicitors

ORDERS

1. The husband shall within 60 days of the date of these orders pay the wife the sum of $597,875.74.

2. Contemporaneously with receipt of this amount the wife shall do all acts and things and sign all documents necessary to transfer to the husband at the expense of the husband all of the wife’s right title and interest in the properties known as “Property A1” and “Property A2” at (omitted) in the state of New South Wales and more particularly described as Folio Identifiers (omitted) and (omitted) (hereinafter called “Property A1”).

3. If the husband fails to comply with Order 1 the husband and wife shall forthwith do all acts and things and sign all documents required to list  Property A1 for sale on the following terms:

   (a)the property shall be listed for sale with a real estate agent agreed between the parties;

   (b)in the event that the parties cannot agree on the nomination of such agent they shall jointly approach the President of the Real Estate Institute of New South Wales and accept his or her nomination of a real estate agent to sell the property;

   (c)in the event that the parties are unable to agree on a listing price, selling price, the time of listing, the method of sale or the conditions of sale they shall accept the recommendations of the real estate agent appointed pursuant to these orders in respect of each such matter;

   (d)upon completion of the sale the proceeds of sale shall be applied as follows:

   (i)in payment of the costs and expenses of sale including agent’s commission and conveyancing costs;

   (ii)in payment of adjustments, if any;

   (iii)in payment of 55.05% plus $125,819.25 to the husband and 44.95%  less $125,819.25  to the wife.  

4. The “Mr Britt and Ms Britt” partnership is dissolved as at the date of these Orders and each party shall pay one half of the accounting costs associated with the dissolution of the partnership.

5. Upon the dissolution of the partnership as referred to in Order 4 the Wife shall transfer to the husband all of the wife’s interest in the assets of plant, equipment, stock, bank accounts, fixtures and fittings of the partnership together with the debtors, loan accounts and undistributed profits.

6. The husband shall indemnify the wife and keep her indemnified and will secure the release or discharge of the wife from all liability of the husband or of the parties jointly with respect to the debts of the partnership, including but not limited to all or any indebtedness with respect to any current account held jointly by the parties or either of them which may be overdrawn as at the date of this order.

7. Unless otherwise specified in these orders the husband shall indemnify the wife and keep her indemnified in respect of all actions, suits, claims or demands in relation to:

   (a)any other liability standing in his name;

   (b)any liability encumbering any item of property to which he is entitled pursuant to these Orders.

8. Unless otherwise specified in these orders the wife shall indemnify the husband and keep him indemnified in respect of all actions, suits, claims or demands in relation to:

   (a)any other liability standing in her name;

   (b)any liability encumbering any item of property to which she is entitled pursuant to these Orders.

9. Each party is otherwise declared the owner of all assets in their possession, registered in their name or under their control.

10. If either party refuses or neglects within 14 days of a written request to do so to sign any documents necessary to give effect to these orders the Registrar of the Newcastle Registry of the Federal Circuit Court of Australia is hereby appointed pursuant to s.106A of the Family Law Act1975 to execute such documents on behalf of such party.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT NEWCASTLE

SYC 3351 of 2012

MS BRITT

Applicant

And

MR BRITT

Respondent

REASONS FOR JUDGMENT

Introduction

1. Ms Britt and Mr Britt separated in November 2011 after a 30/31 year relationship/marriage. They both seek property settlement orders.

2. The principal assets in the pool are an unencumbered jointly owned farm worth $1.6m and an unencumbered home in the wife’s name worth $365,000.00.

3. It was agreed that the wife should retain the home and that the husband should be given the opportunity to retain the farm provided that he paid the wife a sum of money but the parties were worlds apart as to what that sum of money should be. The wife sought between and $985,293.70 and $874,918.20 and the husband proposed $157,477.50.

4. The wife’s counsel submitted that the pool should be divided either 57.5/42.5 or 62.5/37.5 in the wife’s favour. He submitted that contributions should be assessed as 52.5/47.5 in the wife’s favour and that a 5% to 10% adjustment should be made in her favour for s.75 (2) matters. He asked the court to give weight to the wife’s claim that the husband had been violent during the relationship and to the fact that the husband had the benefit of living on the farm post-separation while the wife had been required to fight to get a fair share of partnership profits.

5. He submitted that the s.75 (2) factors favoured the wife among other things because as a result of her leaving school at 15 to live with the husband and spending the next 30 years working on the farm and bringing up children she was unfitted to obtain employment.

6. The husband’s counsel proposed a 75/25 division in the husband’s favour. She submitted that he should be given credit for bringing the first farm the parties owned into the relationship and that the fact that the wife had wasted money on gambling and caused a $100,000.00 loss by mismanaging the GST returns had to be factored in.

7. The husband’s counsel submitted that the wife had experience working in (omitted) and (omitted) and could get employment if she chose while the husband was 17 years older and had no future income earning capacity if he was unable to keep the farm. She submitted that the wife had already received a substantial amount post-separation which needed to be factored in and finally that the fact that the husband had a baby with a new partner both of whom he was obliged to support required an adjustment in his favour.

The evidence

1. The wife relied on her initiating application filed on 8 June 2012,        her affidavit and financial statement filed on 14 February 2014 and the affidavits of Mr K filed on 12 June 2013 and Mr H filed on 14 February 2014.  She was also permitted to rely on paragraphs 4, 5, 7, 8 & 9 of an affidavit filed on 6 August 2014.

2. The husband relied on his amended response filed on 6 March 2014,  his affidavit and financial statement filed on 5 March 2014 and the affidavits of his partner Ms K filed on 4 March 2014 and his sister Ms T filed on 11 March 2014.

3. Ms T corroborated the husband’s claim that some of the farm equipment in his possession had come to him from his family. The parties took this into account by reducing the value of the plant and equipment included in the pool.

4. An affidavit by the husband’s solicitor Ms S filed an on 27 August 2007. This was necessary because it became apparent during the hearing that the husband either could not read or had great difficulty reading and none of his affidavits contained a jurat saying that the documents had been read to him. Ms S confirmed that she had read all relevant documents to the husband.  

5. All of the witnesses (including Ms S) were cross-examined.

6. Both parties showed a lack of discrimination in the issues they pursued at trial with the result that the hearing was far longer than it need have been.

7. The wife complained at length at both an interim and final stage that the husband’s current partner kept horses on the farm which ate feed leaving less feed for cattle and sheep. So what? There was absolutely no evidence which would allow me to find that this had any dollar affect on the parties.

8. The husband complained that immediately after separation the wife forged a letter which stated that the Meat & Livestock Corporation forbade him to sell stock and said that as a result he did not sell stock for some months after separation, in other words she helped herself to an injunction. So what? There was no evidence which would allow me to find that this caused a loss to the husband in dollar terms.

9. The husband’s counsel cross-examined the wife at length about the fact that the home she purchased in Property J was previously owned by her current partner and about the fact that she began paying for work on the home in February 2012 well before she became the owner of it. This might have been relevant if the sale had not gone through and the money had been lost but that did not happen and the wife’s expenditure prior to becoming the owner of the property was financially irrelevant.

10. While there was nothing to choose between the parties as far as this lack of discrimination in pursuing unhelpful issues was concerned there was something to choose between them as witnesses. The husband was not caught out in any inconsistencies and errors but it became abundantly clear during cross-examination that a good deal of the evidence in the wife’s affidavit was incomplete, misleading or just plain wrong.

11. I will not attempt to catalogue all of the errors and misstatements here because there was an absolute plethora of them but one striking example was the conspicuously misleading evidence the wife gave about the GST returns.

12. The wife did the parties’ bookwork and was responsible for completing returns after GST was introduced in 2000. The ATO became suspicious about the amount being claimed back for GST paid and conducted an investigation and ultimately fined the parties almost $100,000.00 for intentionally disregarding the law.

13. In her trial affidavit the wife said that she only made errors during the 2007 financial year. However ATO records obtained by the husband showed that the ATO first spoke to the wife in 2005 and levied fines for all returns filed between 2000 and 2006.  

14. During cross-examination the wife admitted that she had overstated the GST paid from at least 2002. She could not explain why she had put only one brief misleading paragraph about this issue in her trial affidavit.

15. Another example of unsatisfactory evidence by the wife was that she claimed that she was taking medication for depression but agreed during cross-examination that the medication she was taking was Duromine, a medication used to treat obesity. The wife admitted that she had been to numerous different doctors to obtain this medication which contains amphetamines.

16. Yet another example was the evidence given by the wife in her February 2014 affidavit about her current financial circumstances. She said as follows:

    For the last year Mr L [Mr L, the wife’s de facto partner] and I have lived off his [aged] pension and as a result have lived very frugally.[1]

    [1] Wife’s affidavit paragraph 63

17. The wife admitted during cross-examination that Mr L was not only entitled to the aged pension but had done some paid work as recently as Christmas 2013, did (omitted) work in (omitted) in 2013, had a business card namely “(business omitted)” and sometimes sold scrap metal.

18. The wife agreed that the evidence in her trial affidavit that her vehicle was unregistered was wrong. When she was challenged about her assertion that she had not been able to afford to register her vehicle the wife said that she had not read her affidavit thoroughly and had skipped bits she thought were repetitious.

19. The wife was not a witness of credit and this will have relevance when I come to make findings about issues in dispute. However it is important to note that I cannot use the wife’s conspicuous lack of credit to paper over cracks in the husband’s case and make findings adverse to the wife when there is insufficient evidence to support them.

Background

1. The husband and wife commenced cohabitation in either 1980 or 1981. The wife said that it was in 1980 when she was 15 and the husband 32. The husband said that it was at the end of 1981 by which time the wife was 16. For the purposes of these proceedings it is immaterial which is correct.

2. The parties married on (omitted) 1988 and separated on or about 13 November 2011.[2] They thus lived together/were married for either 30 or 31 years.

   [2] The husband said that the parties separated on 1 November 2011 and the wife said that it was on 13  

3. The parties have four children: W born on (omitted) 1982 (32), X born on (omitted) 1986 (29) Y born on (omitted) 1989 (25) and Z born on (omitted) 1991 (24).

4. The husband was previously married and has two children from his first marriage. He paid child support for those children after cohabitation commenced but he has not seen them since he separated from their mother and at trial he could not remember their birthdates.

5. The husband comes from a farming background and in 1973 he and his brother Mr B (and according to the husband his father Mr T as a silent partner) purchased a 312 ha property called “Property L” near (omitted). The husband contributed cash from his property settlement with his first wife which he believed was $20,000.00. The wife’s witness Mr H, a stock and station agent, said that he sold the property to the husband, his brother and his father Mr T for $47,000.00. The husband’s recollection that he put in $20,000.00 may therefore be about right.

6. Property L was used for grazing sheep and cattle and also occasionally to grow (omitted). The wife moved onto Property L at the commencement of cohabitation.

7. In 1984 Mr B died and the husband purchased his half interest in the farm for $50,000.00. He said that he paid this by instalments using the proceeds of sale of stock and wheat from the property. Other evidence suggested that he may have borrowed the money from his mother and later repaid her by the same means but nothing turns on this.[3]

   [3] What happened to Mr T’s interest if any in the property is unknown to me.

8. The husband (and presumably his brother Mr B prior to his death) ran the farm. The wife assisted on the farm in a variety of ways, was involved in homemaking and parenting the children and also earned money working for a local hotel, on other properties, in a (omitted) in (omitted) and at trade shows.

9. Toward the end of the marriage Property L was discovered to be on a valuable coal deposit and in 2009 the parties sold it to (omitted) for $3.4 million.

10. The parties used $1.9 million of the proceeds of sale to purchase a 520 ha property called “Property A1” (which consists of two properties, Property A1 and Property A2) in joint names. They farmed Property A1 in partnership, running cattle and sheep and growing crops. 

11. The wife moved off Property A1 on or about 13 November 2011. She lived in the nearby town of (omitted) for about a month and then moved to (omitted) where her current partner Mr L lives.

12. The wife commenced a relationship with Mr L either at or not long after separation.[4] In February and May 2012 $460,000.00 of the sale proceeds of Property L which had been invested with a stock and station agent were released to her and she used the money to buy Mr L’s home at Property J from his trustee in bankruptcy and to do extensive renovations to the property.

    [4] The husband’s counsel submitted that the wife commenced the relationship with Mr L prior   

13. In January 2012 the husband commenced a relationship with Ms K whom he had known since she was a child and she moved onto Property A1 to live with him.

14. On 8 June 2012 the wife filed an application for a property settlement.  She sought final orders that Property A1 together with the stock and plant and equipment be sold and the proceeds be divided 60/40 in her favour.  Presumably she also intended that she retain the Property J property.

15. The husband filed a response in which he proposed that he retain Property A1 and pay the wife $250,000.00.

16. The applications for final orders were listed for hearing in Tamworth in June 2013. The parties sought an adjournment of the hearing however; I was advised that the wife wished to obtain updated valuations.

17. In September 2013 I made orders for those valuations to be obtained and I listed the matter for hearing in Newcastle in the week commencing 13 March 2014.  The proceedings were not completed in the four days allocated and finally concluded on 29 August 2014.

18. The wife continues to live at Property J and continues to be in a relationship with Mr L. The husband continues to run Property A1 and he and Ms K have a child A born on 4 April 2014.          

The law applicable to the property proceedings

1. S.79 (1) of the Family Law Act 1975 empowers the court to make such orders as it considers appropriate altering the parties’ interests in property.

2. S.79 (2) provides that the court shall not make an order under this section unless it considers that it would be just and equitable to do so.

3. The parties had a long marriage and the farm which comprises nearly 75% of the pool is in joint names. The parties cannot continue to farm it jointly or both live there and this case clearly falls within the following situation described by the High Court in Stanford & Stanford:

   In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4). [5]

   [5] Stanford & Stanford (2012) 247 CLR 108

4. I intend to take the usual steps to resolve the question of what particular alteration of their interests would be just and equitable. Those steps are:

   i)to identify and value the assets and liabilities of the parties;

   ii)to assess the contributions of the parties under s79(4)(a), (b) and (c) and to express those contributions as a percentage;

   iii)to consider the matters in s.79(4)(d), (e), (f) and (g), which include the matters in s.75(2) so far as they are relevant, and determine whether any adjustment should be made as a result to the contribution based entitlements;

   iv)to consider the effect of those findings and resolve what orders are just and equitable in all the circumstances of the case.

Assets and Liabilities

1. The asset pool was agreed and is as follows:

Description	Ownership	Value
Property A1 – 960,000 Property A2 – 650,000	Joint	1,610,000.00
Livestock	Joint	148,365.00
Farm equipment	Joint	42,745.00
Property J	Wife	365,000.00
Toyota (omitted)	Wife	27,000.00
Household contents	Wife	2,000.00
Quad bike	Wife	400.00
Household contents	Husband	2,000.00
(omitted) Utility	Husband	10,000.00
TOTAL	2,207,510.00

1. The wife’s witness Mr H, a stock and station agent, alleged in his affidavit that Property A1 was overstocked and in poor condition as a result. However even if this is true (and for reasons to be given later it is not open to me to find that it is) there was no evidence which would allow me to translate this into dollar terms or make a finding about any consequent effect on the value of the property.

2. The husband has some cattle worth $10,850.00 which were left out of the pool by agreement because they represented half a herd which the husband retained when the wife sold the other half of the herd.

3. The wife alleged that the husband had failed to account for all the relevant cattle on the property when a count was conducted for the purpose of valuing the cattle for these proceedings but Mr H has been to the property as the wife’s agent since separation and he conceded that there was no evidence that the husband had hidden cattle or replaced the ear tags of cattle with different ear tags.  There is simply no evidence on which I could find that the husband has failed to account for any cattle.

4. The husband alleged that at the time of separation the wife took furniture, a 4 wheel motor bike and farm related good including tools and a lawn mower. This may be so but there was no evidence at trial which would allow me to put a dollar figure on the items taken by the wife save for the quad bike which was included in the pool at $400.00.

5. The parties have no superannuation and no relevant liabilities and the pool is therefore worth $2,207,510.00.

Contributions

1. Each counsel proceeded on the basis that contributions should be assessed on a global basis.

Initial contributions

1. The wife has no assets at the commencement of cohabitation. The husband had the interest in Property L which he acquired in 1973.

2. There is no reason to doubt the husband’s claim that he put about $20,000.00 into the purchase.  

3. There was no evidence of the value of Property L in 1980 or 1981. The husband bought out the half interest of his brother and sister-in-law in 1984 for about $50,000.00. It was not an arm’s length transaction but his brother’s widow had no reason to make a gift to him.

4. The best evidence is that the husband’s half interest in Property L was worth between $20,000.00 and $50,000.00 when cohabitation commenced

Contributions during the relationship

1. The husband paid the $50,000.00 for his brother’s half interest in Property L from farm income from 1984 onwards so he does not get any special credit for bringing the second half of Property L into the pool. This was a joint contribution by the parties who by then had a child together.

2. I am satisfied that the husband was primarily in charge of the farming enterprise during the party’s relationship.

3. The wife was somewhat disparaging of the husband’s efforts and claimed that he would drive around Property L in a vehicle calling on her for help if anything substantial like a problem with stock needed attending to. She agreed that the parties both prepared paddocks for cropping when they did crop and that they both participated in harvesting.

4. The wife was not a witness of credit and I am satisfied that she considerably understated the husband’s role in running the farms. The husband grew up on a farm and I am satisfied that he brought expertise and contributed the primary effort to the running of Property L and Property A1.

5. The wife said that she was also actively involved in the diverse work needed to run Property L and later Property A1, including mustering, lamb marking, dipping, drenching, calving and assisting with shearing. The wife alleged that she also did fencing, maintaining and repairing machinery, changing tyres and cutting and splitting firewood.

6. The husband conceded that the wife was involved in farm activities and I am satisfied that the wife worked on the farm in varied and important ways.

7. The wife complained that the husband overstocked Property L resulting in the cattle available for sale being in poor condition thereby affecting the parties’ income. However bare assertions of Mr H are not sufficient to establish that over a period of 28 or 29 years the stock were regularly in poor condition or that if so the husband’s management as opposed to conditions was the cause, and there was no evidence which would allow me to make a finding about the effect of the condition of the stock on the parties income in any event.

8. The wife brought other income into the relationship. From about 1986 onward she began earning income from working at (omitted), on other properties and for a (employer omitted) in (omitted). She said, and she was not challenged about this, that she sometimes had more than one job at a time.

9. The fact that the wife worked outside the home as well as on the farm and as homemaker and parent does not entitle the wife to any extra credit however. It was simply a case of each party choosing how they spent their time in any given day.

10. The wife was also in receipt of social security benefits of one kind or another for the entire time that the parties lived on Property L, mainly in the form of parenting payments. The husband also received some social security payments by way of drought relief or unemployment benefit. 

11. The wife complained at length during the hearing about the state of the house on Property L, implying that being required to live in it was a hardship, and to extend her argument as far as it can go implying that this made her job as homemaker and parent more difficult.  However the husband did not concede that the house was substandard and the wife was not a witness of credit and in any event they both lived in the house and shared equally in any hardship occasioned by the state of it.

12. The wife claimed that she was the primary homemaker and parent and this is likely to be true. The husband said that he did his share of parenting including looking after the children when the wife worked as a (omitted) at (employers omitted). He said that the children sometimes came around the farm with him and that when they were in high school he took them to and collected them from the school bus and these things are likely to be true as well.

13. Insofar as their day to day activities over a period of 30 or 31 years are concerned I am satisfied that the parties contributed equally.

The wife’s Kennon argument

1. The wife alleged that the husband was violent to her during the relationship and that this made her performance of her role in the marriage more difficult and it was her case that this warranted a finding that her contributions overall exceeded the husbands. She relied on Kennon & Kennon in which Fogarty & Lindenmayer JJ said as follows:

   The Court in assessing contributions can take into account that where there is a course of violent conduct by one party toward the other during the marriage, which is demonstrated to have had a significant adverse impact on that party’s contributions to the marriage or, put another way, to have made his or her contributions significantly more arduous than they ought to have been, that is a fact which a trial judge is entitled to take into account in assessing the parties’ respective contributions within section 79.[6]

   [6] Kennon & Kennon (1997) FLC 92-757

2. The wife alleged that the husband abused her physically and verbally if she did not get the kitchen tidied at night and the children’s lunches ready for the next day and abused her and sometimes beat her if she did not cook him a hot breakfast. She alleged that when W was a baby the husband came home extremely intoxicated after midnight one night after she had sent him out to buy milk and when he returned home threw the bottle of milk at her. She said that she dodged the bottle and it hit the fridge and milk splashed everywhere. She alleged that the husband grabbed her by the hair and pushed her into the floor where the milk had spilt and forced her to clean it up.

3. The wife alleged that if the husband thought she had not done the washing up properly he would drag her by the hair to the sink and put her head in it and verbally abuse her.

4. The wife alleged that in about 2002 she contracted Ross River fever and needed to sleep during the day to recover. She alleged that the husband was angry about her sleeping during the day and she had to find a way to rest surreptitiously although he ultimately agreed that she needed sleep during the day and allowed her to sleep.

5. The wife alleged that in about 2006 she began to feel depressed and suicidal and found it a struggle to do her chores on the farm. She alleged that the husband was verbally abusive and refused to accept that she was depressed.

6. Mr K gave evidence on behalf of the wife in connection with this aspect of the case. He said that he had lived in the (omitted) area all his life and alleged that when the wife was very young, too young to be admitted into the hotel, he saw her crying outside the hotel and she told him that the husband had just belted her.

7. Mr K said that when the parties were living at Property L he saw the wife with a black eye. He asked how she got it and she said “Mr Britt, what do you think.” He said that the wife said something similar when he saw her with a black eye on another occasion. 

8. Mr K said that the wife told him on a number of occasions that the husband had belted her or bashed her and that he saw bruising on her elbow on one of those occasions.

9. The wife alleged that on one occasion she contacted (omitted) Police about the husband’s behaviour and that he was very apologetic afterwards and talked her into withdrawing the complaint. She alleged that on other occasions when she threatened to call the police the husband subjected her to a deluge of verbal abuse.

10. The wife alleged that on 13 November 2011 she and the husband argued after the husband left a gate open and cattle strayed into the yard near the homestead where she was trying to maintain a lawn and garden. She said that she got on a quad bike to try to move the cattle out and the husband grabbed her by the shirt, pulled her off the bike and raised his fist above her head. She said that she struggled free and left Property A1 and the relationship ended that day.

11. There are several reasons to be extremely suspicious about the wife’s evidence about abuse and family violence.

12. First, the wife was not a witness of credit. She gave a number of demonstrably false pieces of evidence during the proceedings.

13. Second, since separation the wife has behaved in aggressive and confrontational ways towards the husband, his partner Ms K and the parties’ son Y which have resulted in the police being called and the wife charged, which calls into question whether the wife would have allowed herself to be abused in the way she described and whether she might in fact have been the aggressor during the relationship as the husband alleged rather than the victim as she alleged.

14. In January 2012 the wife had an altercation with Y after she went to Property A1 with three adult males and tried to remove property. She was charged with assaulting Y and a provisional Apprehended Domestic Violence Order (ADVO) was made for the protection of the husband and Y.

15. The wife pleaded guilty to the charge in Gunnedah Local Court on 16 April 2012 and was placed on a 12 month good behaviour bond and a final ADVO was made for the protection of Y.

16. On 6 March 2012 the wife attempted to obtain possession of a trailer at Property A1 and on her own admission:

    had words with the husband and drove through a garden bed [I] had planted.

17. Arising out of a complaint to police made about the events of this day the wife was charged with breaching the provisional ADVO, damaging a garden bed and a curtain rod in the house, intimidating Ms K and stealing.

18. On 6 August 2012 the wife was acquitted of stealing but was convicted of intimidating Ms K, contravening the ADVO and damaging the garden bed and was put on a 12 month good behaviour bond with no conviction recorded. 

19. The wife has sent the husband a number of very offensive and threatening messages since separation[7] which also suggests that she is no shrinking violet when it came to confrontation with the husband.

    [7] Husband’s trial affidavit paragraphs 77, 78 and 79

20. Ms K, who had some interaction with the parties during their marriage, claimed that she had seen the wife hit the husband across the head with an open palm, hit him in the face, hit him repeatedly in the face while he was sitting in a chair and hit him in the head while he stood in a corner. She said that on this last occasion her father pulled the wife off the husband.  

21. During cross-examination it was put to the wife that on one occasion during the marriage she threw coffee mugs after becoming angry and broke a window. It was alleged that the husband rang the police and the wife ran off.  The husband also said that the wife hit him the head with a lolly jar.

22. I cannot be satisfied on the balance of probabilities that any of the evidence the wife gave about the husband’s aggression or violence is true. The wife was not a witness of credit and the evidence of Mr K is only as good as the truth of the things the wife told him. The wife clearly has aggressive tendencies herself which leaves open to question whether she would have meekly put up with the husband assaulting her.

23. I am more inclined to believe the husband’s evidence about the coffee cups and the lolly jar and Ms K’s evidence about the wife hitting the husband but these are property proceedings, the husband did not attempt to use these allegations as a sword but only as a shield and isolated assaults which do not impact on a person’s contributions are not relevant.

Other matters raised by the husband

1. The husband made a number of allegations about the wife’s financial conduct during the marriage which his counsel submitted needed to be taken into account namely:

   ·the conduct which led to the ATO fines;

   ·an allegation that the wife had a gambling problem;

   ·an allegation (perhaps related to this) that the wife used for her own purposes money received for an exploration license, from a quarry, from the (omitted) and from the sale of motor vehicle and that she surreptitiously sold cattle and retained the proceeds;

   ·her use of the Property L sale proceeds, allegedly profligately and benefitting only herself;

   ·her decision to lend money to Ms G and Mr R.

2. These matters are all best treated as s.75(2)(o) matters rather than an attempt being made to take them into account (if they are proved and proved to be reckless or wasteful) as negative contributions by the wife.

Post separation matters

1. The wife alleged that since separation the husband had ramped up claims for expenses such as for fuel which had deprived her of her proper share of the money from cattle sales but this is best dealt with as a s.75 (2)(o) matter.

2. More relevantly for the purposes of assessing contributions the wife alleged that the husband had:

   i)overstocked and thus devalued Property A1 and failed to properly look after the cattle resulting in the sale prices received being depressed;

   ii)allowed Ms K to keep too many horses on the property. The wife said that she and the husband had kept up to 3 horses but in March 2013 she counted 13 horses on the property. She complained that the horses were eating feed which would otherwise be available for livestock.  She also complained that no winter fodder crop had been planted and that no ground had been prepared for sowing a summer crop, the paddocks were bare and in poor condition, and the internal fences were in poor condition.

   iii)neglected the house and destroyed the surrounding gardens.

3. The wife filed an affidavit by Mr H with a view to establishing the husband had overstocked the property and managed it poorly since separation.

4. Even if I accepted Mr H’s evidence I would be struggling to know what to do with it as there was no yardstick which would allow me to translate it into dollar terms and make a finding that the sale prices for cattle had been affected. However Mr H conceded during cross-examination that two different farmers might have two different approaches to farm management and that he did not always see eye to eye on farm management issues with the people he worked for. It is not open to me to find that the husband has mismanaged or overstocked Property A1 since separation.

5. There was no evidence that Ms K keeping horses on the property had any financial impact for the parties.

6. There was no independent evidence of neglect of the house or gardens let alone evidence that neglect had decreased the value of the property.

7. The husband complained about the fact that post-separation the wife unilaterally cancelled the farm insurance.

8. There is no doubt that the wife did do this and it not only left the farm buildings uninsured it meant that the wife received a refund cheque for $3,631.00. I will take the wife’s receipt of this money into account as a s.75(2)(o) matter but fortunately the farm did not burn down after the cancellation of the insurance policy so it had no financial consequence for the parties.

9. Not long after separation the husband received a letter which purported to come from the Meat and Livestock Corporation informing him that on behalf of the wife they had been requested to act on any sales or movement of livestock from the property.

10. The letter went on to say that as of 27 January 2012 no stock could be moved or sold until further notice and that if this occurred legal action would be taken.

11. For a considerable period of time the husband believed that the letter was authentic and that he was not permitted to sell or move stock. Eventually his son Y or his partner Ms K (he was not sure which) read it and said that they suspected that it was a forgery.

12. The wife denied writing the letter but she did other peremptory things after separation which had the potential to cause harm to the farming enterprise such as cancelling the insurance. I strongly suspect that the wife did write the letter but even if she did there was no evidence that this had a flow on effect in dollar terms, just as the cancellation of the insurance did not in fact result in the parties suffering any loss.

13. The husband deserves credit for looking after Property A1 post-separation and that has not been easy in drought conditions but the wife did not walk away from Property A1 and leave the husband to deal with it on his own. She tried to continue to have a say about its management but unfortunately the parties could not work together effectively. I do not accept that the bare fact that the husband has continued to manage Property A1 post-separation entitles him to an adjustment in his favour on the basis of contributions.

Conclusion about contributions

1. The wife’s counsel submitted that contributions should be assessed as 52.7% by the wife and 47.5% by the husband largely because of post-separation issues although he continued to rely on Kennon issues while admitting that the claim was weak. He submitted that the husband’s introduction of a half share in Property L at the commencement of a 31 year relationship should be given very little if any weight.

2. The husband’s counsel argued that contributions should be assessed as 65/35 in the husband’s favour to take account of the introduction of Property L, the loan by the husband’s mother which conserved the property after the trouble with the ATO and the husband’s post-separation contributions.

1. I intend to deal with the ATO debt as a s.75 (2) (o) matter and nothing supports a finding in the husband’s favour about post-separation contributions.

2. The wife has not made out a Kennon claim and there is simply no basis on which I could find that the any post-separation conduct by the husband justified an adjustment in the wife’s favour. Absent the issue of the husband’s introduction of the half-interest in Property L, I would assess contributions as equal.

3. It is reasonable to suppose that at one time the husband thought the same because he gave the following evidence:

   [At the time Property L was sold I said to her] ‘If you want to go take half the money and go’ but she decided to go on to the next farm.

4. The issue then is what to do with the husband’s introduction of a half interest in Property L, which due to its lucky placement on a coal deposit was sold for $3.4m in 2009 after being purchased 36 years earlier for $47,000.00.

5. The parties lived on Property L for either 28 or 29 years. They were both involved in the farming operations carried out on the property and in the care of the children. The wife earned income from off-farm activities for a good part of the marriage.

6. I am conscious of the fact that but for the existence of the property at the commencement of cohabitation the parties would not have made the windfall gain in 2009 and in Williams & Williams the Full Court said as follows:

   We think that there is force in the proposition that a reference to the value of an item as at the date of the commencement of cohabitation without reference to its value to the parties at the time it was realised or its value to the parties at the time of trial, if still intact, may not give adequate recognition to the importance of its contribution to the pool of assets ultimately available for distribution towards the parties. Thus where the pool of assets available for distribution between the parties consists of say an investment portfolio or a block of land or a painting that has risen significantly in value as a result of market forces, it is appropriate to give recognition to its value at the time of hearing or the time it was realised rather than simply pay attention to its initial value at the time of commencement of cohabitation. But in so doing it is equally important to give recognition to the myriad of other contributions that each of the parties has made during the course of their relationship.[8]

   [8] Williams & Williams (2007) FamCA 313

7. However if the value of the husband’s half interest in Property L is fixed roughly at between $20,000.00 and $50,000.00 it represents somewhere between 1% and 2% of the pool. The parties contributed equally to the acquisition of the other half of the property in 1984 and spent 28 or 29 years working hard to preserve the property without which they would never have been able to realise the windfall gain.

8. I consider that an adjustment of 0.05% in the husband’s favour is an adequate recognition of the initial contribution by the husband of a half interest in Property L.

9. This would entitle the husband to 50.05% or $1,104,858.76 and the wife to 49.95% or $1,102,651.25 and create a differential of $2,207.51 between the parties entitlements.

S.79 (4) (d) (e) (f) & (g)

1. Ss. 79(4) (f) and (g) of the Family Law Act have no relevance in these proceedings.

2. Ss. 79(4) (d) requires me to take into account the effect of any proposed order on the income earning capacity of either party.

3. I cannot make a finding about whether any order I make will affect the husband’s income earning capacity.

4. I have no idea whether the farm will have to be sold as a result of any order I make. During final submissions the husband’s counsel said that the husband could obtain the $157,000.00 he proposed paying the wife but I have no idea whether a greater payment and if so what greater payment will require the sale of the farm.

5. I was not told how the husband intended to fund either the payment he proposed or any other payment. If he has to take out a loan it may affect his income but if the money came through a family loan or through his partner this would not necessarily be the case and I cannot make assumptions without evidence.

6. The only relevant subsection therefore is s.79 (4)(e) which requires me to consider the matters in s.75(2).

S. 75(2) matters

The wife’s circumstances

1. The wife has just turned 49.

2. The wife has not worked in paid employment since separation and alleged that she was hampered in obtaining employment by the fact that she left school early and by health issues.

3. The wife alleged that she suffered from depression and took medication and sometimes found it hard to get out of bed. She said that she had recently begun counselling. During cross-examination however the wife agreed that the medication she was taking was Duromine which is used to reduce bodyweight in obese or overweight patients.

4. The evidence did not establish that the wife had health issues which would prevent her working and her assertion that she has no job skills at all runs contrary to her own evidence. During the marriage the wife worked in (omitted) and in a (omitted). She obtained a (omitted) course. There was no evidence that she had looked for this kind of work since relocating to Property J. She said that she had applied for work at a (omitted) near Property J and as a (omitted) at a (employer omitted) but had not got either job.

5. I accept that the wife does not have any qualifications. She left school at 14 years and 10 months and has done part of year 10 at best. She commenced living with the husband when she was 15 or 16 and spent the next thirty years bringing up children and working on the farm. However in a climate where the government now expects people to work until they are 67 and where the wife is 18 years away from that and has some experience in the workforce, I cannot be satisfied on the slender evidence the wife provided that she has no prospects at all of obtaining employment of some kind if she looks for it.

6. I concede that any employment the wife obtains is likely to be modestly paid and that if she wishes to obtain qualifications even in an area such as (omitted) she will need to further her education and may need to take time out of the work force to do that.

7. The wife is in a relationship with Mr L aged 67. Mr L is a retired (occupation omitted) who is on the age pension. The wife said that they had been in a committed de facto relationship since February 2012.

8. The wife was not particularly honest about Mr L’s capacity to earn income in addition to receiving a pension but given his age I accept that Mr L is not likely to be a source of great financial support for the wife in the future.

9. The wife said that she was in a very poor financial position with no income and that (omitted) Council were suing her for unpaid rates, that she had credit card debt exceeding $14,000.00 and the bank were threatening to sue her. She alleged that as at January 2014 she owed $20,000.00 in total to various creditors.

10. The wife has had over $130,000.00 from cattle sales since separation three years ago in addition to the money specifically paid to assist her to purchase and renovate the Property J property. There was unsatisfactory evidence about how much of this the wife had paid to lawyers and no explanation for why this together with any financial contribution by Mr L and the $20,000.00 she kept at separation and the $3,631.00 she obtained by cancelling the insurance had not enabled her to live reasonably comfortably since separation, especially given that she had the advantage denied to many of living in a home without the need to pay rent or a mortgage.

11. The wife is entitled to $1,102,651.25 on the basis of contributions. She has the Property J property, her furniture, the Toyota (omitted) and the quad bike, worth $394,400.00. If the husband retains the remainder of assets in the pool he will be required to pay her $708,251.20.

12. The wife has credit card debt and she owes money for legal fees which will reduce the amount available to her. The wife never made clear how much she owed her solicitors but given that the husband has incurred costs of $110,000.00 plus I would anticipate that the wife’s legal bill may be substantial. However she will still be left with an unencumbered home and a not insignificant capital sum.

13. Whether the wife will receive quite the capital sum which contributions suggest she is entitled to however depends on the findings I make about a number of matters which the husband’s counsel submitted needed to be taken into account pursuant to s.75 (2) (o).

14. S.75 (2) (o) allows the court to take into account any other fact or matter which the justice of the case requires to be taken into account.

15. The husband’s counsel submitted that the following matters needed to be taken into account:

    (i)The wife’s use of the Property L sale proceeds;

    (ii)The wife’s conduct leading to the ATO fine;

    (iii)The wife’s gambling;   

    (iv)   Evidence that the wife sold cattle surreptitiously  during  the marriage and retained the proceeds.

    (v)The wife’s decision to lend money to Ms G and Mr R

    (vi)The wife’s receipt of monies post separation

The Property L sale proceeds

1. During final submissions the husband’s counsel asserted that “millions” had disappeared from the sale proceeds but this is a gross exaggeration.

2. From the sale proceeds the parties paid $1.9m for Property A1 together with stamp duty of $90,030.00 and legal fees of $12,689.72. They spent $43,106.50 at the Property A1 clearing sale and purchased plant, equipment and stock ($79,059.00) furniture ($11,380.00) and hay ($35,200.00) from the owners

3. The proceeds of sale were also used to:

   i)repay a loan of $100,000.00 plus interest to the husband’s mother (total $106,000.00) who had lent the parties money in 2007 to pay the fines levied by the ATO;

   ii)purchase a mob of sheep and a tractor for a neighbour Mr A ($60,000.00);

   iii)lend $30,000.00 to Ms G and Mr R;

   iv)invest $550,000.00 (according to the wife) or $400,000.00 (according to the husband)with a stock and station agent.

4. The wife’s evidence about the amount invested with the stock and station agent is more likely to be correct as there was $532,000.00 in the account in early 2011.[9]

   [9] Husband’s affidavit exhibit

5. This amounts to $2,917,465.20 and the difference between that and the sale price of Property L is $482,534.80.

6. It appeared to be the husband’s case that the wife should be held responsible for squandering at least some of this money.

7. In support of his case the husband attached to his affidavit a breakdown he had prepared (or at least adopted as given the husband’s literacy issues it was presumably prepared by his lawyer) of deposits into all the parties accounts from September 2009 to 2012 and the way the money was spent.

8. Extending this summary into 2012 was unhelpful. It blurs the boundary between money spent prior to separation in November 2011 and money spent after separation including the money transferred to the wife with the husband’s agreement to allow her to purchase the Property J property.

9. Concentrating on the pre-separation period however the husband’s counsel extracted from the wife in cross-examination a concession that she was the only one responsible for ATM withdrawals and that money coming out of accounts that way must have been used by the wife.

10. The husband’s counsel drew attention to the fact that there were frequent withdrawals from (omitted) of $800.00 and that the wife’s explanation that some of the money had been paid to a labourer Mr P was demonstrated to be false by her answers in cross-examination. She drew attention to the fact that money was spent on jewellery and in (omitted), somewhere the wife alone allegedly liked to visit, rather than in (omitted).

11. The husband’s counsel made absolutely no attempt however to dissect the figures and persuade me that a certain amount of expenditure was unreasonable. She simply made broad submissions about hundreds of thousands (or even millions) of dollars being unaccounted for and it is simply not possible to come up with a figure which is deemed to have been unreasonably spent let alone unreasonably spent by the wife between the sale of Property L and separation.

12. The wife gave unchallenged evidence that the husband did work on Property A1 after its purchase including fencing and digging a dam and the parties must have expended money on this and they also gave gifts to their children. I cannot put a dollar figure on any of this expenditure nor can I be expected to assume that all of the expenditure the husband placed in the columns headed “Ms Britt’s expenditure” was unreasonable. For example if the wife bought jewellery either for herself or as a gift for others so what?

13. During the two years between the sale of Property L and separation the parties had to pay some wages, pay other farm expenses and put food on the table for themselves and perhaps one or more of the children.

14. The husband did not tender any tax returns for the partnership for 2009 or 2010 or any other financial records with a view to demonstrating that the farm made a substantial profit for those years and that therefore there was no need to draw on the proceeds of sale of Property L for living expenses. The 2011 and 2012 returns show either a loss or a modest profit.

15. The parties had lived frugally on Property L and the wife might well also have been justifiably tempted to spend more on creature comforts once the money from Property A1 was available. The wife went on a holiday to the (country omitted) in 2010 and took two of the children and that must have cost a bit but there was nothing wrong with that.

16. The wife was criticised for her involvement with a lady from the (country omitted) called Ms T who she met on the internet and whose airfare she paid for a visit to Australia, but a certain amount of discretionary spending, even if it does not translate into anything concrete in terms of assets and seems like waste to the other party to the marriage, often occurs in marriages. 

17. The wife admitted in her affidavit that at one time in the marriage she had a gambling problem and had herself barred from a hotel but it was not put to the wife that she had gambled money in the two years between the sale of Property L and separation and in any event this is in the recent past. If the suspicion that the wife gambled away some of the proceeds of sale existed then I would have expected the records of local hotels or clubs to be subpoenaed. This was not done.

18. I have grave concerns about the wife’s honesty, not to say her reliability as a witness, but as I remarked earlier it is simply not open to me to use the wife’s lack of credit as a witness to make a case in circumstances where the husband’s claims amount to no more than speculation and suspicion. It is not open to me to find that the wife wasted any of the proceeds of sale of Property L prior to separation.

The ATO fine

1. The wife did the bookkeeping for the farming business for the last 18 years of the relationship indeed she pointed to this as evidence of her contributions during the relationship. She kept stock control records and records of receipts and payments, did the banking, paid bills, liaised with accountants and did the quarterly BAS returns after GST was introduced in 2000.

2. When she prepared the quarterly BAS returns the wife overstated the GST paid and understated income and as a result the parties received large “refunds.” The ATO became suspicious and conducted an investigation and in 2007 fined the parties nearly $100,000.00. 

3. The husband borrowed the money to pay the fine from his mother and upon the sale of Property L in 2009 the parties paid the husband’s mother $106,000.00 being repayment of the loan plus interest.

4. In her trial affidavit the wife said that she deliberately overstated the GST paid in the 2006/7 returns because she was afraid of the husband. She also alleged that she ultimately confessed to the ATO that she had prepared false documentation because the husband threatened her with what would happen to her if she failed to take responsibility.

5. One immediate difficulty with this evidence is that the ATO records obtained by the husband indicate that the parties were fined for the financial years 2000 to 2006 and not for the 2007 financial year.

6. During cross-examination the wife admitted that she overstated the GST paid from 2003 onwards and was not sure about 2001 or 2002. When asked why she had not mentioned this in her affidavit she responded “I don’t know.”

7. The ATO records indicate that the ATO first raised concerns about the BAS statements with the wife in 2005. After viewing bank statements it became suspicious that the wife had also not properly declared the parties income and it conducted a very thorough investigation into the matter including contacting suppliers and stock and station agents through whom the parties had sold cattle. 

8. The ATO records indicate that officers found the wife difficult to deal with and record that at one meeting she swore at ATO officers and threw something. When the wife was asked in cross-examination whether this had happened she said “I don’t recall.”

9. The ultimate determination of the ATO was that for the period 1 July 2000 to 30 June 2006 the husband and wife reported income of $21,563.00 and the income should have been $200,382.93. It also found that the parties’ had lodged 24 incorrect BAS statements and it was satisfied that the parties had intentionally disregarded the law.

10. In a letter to the husband it gave detailed reasons for forming this view including the following:

    Your representative (Ms Britt) has admitted (via a written statement) that she had  deliberately omitted your supplies and inflated your expenses in lodging Business Activity Statements for the period 1^st  July 2000 to 30^th June 2006 in order to gain a benefit from the Taxation Office

11. The husband’s counsel submitted that the husband should not be required to share in the loss of $106,000.00 from the pool. She relied on Kowaliw & Kowaliw in which Baker J said as follows:

    Marriage is for most couples an economic partnership.  Married couples live together and work together with the ultimate object of purchasing a home, paying it off, acquiring other assets with the overall object of attaining a higher standard of living.  The reported decisions in respect of applications for settlement of property under sec. 79 of the Act are unanimous that both parties should share the economic fruits of a marriage, having regard to the provisions of sec. 79(4) and sec. 75(2), although not necessarily equally. 

    Is not, however, the converse equally sustainable?  In other words, should not financial losses incurred by parties to a marriage or either of them, whether incurred jointly or severally, be shared by them in the same manner as the financial gains? 

    As a statement of general principle.  I am firmly of the view that financial losses incurred by parties or either of them in the course of a marriage whether such losses result from a joint or several liability, should be shared by them (although not necessarily equally) except in the following circumstances: 

    (a) where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets, or 

    (b) where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value. 

    Conduct of the kind referred to in para. (a) and (b) above having economic consequences is clearly in my view relevant under sec. 75(2)(o) to applications for settlement of property instituted under the provisions of sec. 79. [10]

    [10]Kowaliw & Kowaliw (1981) FLC 91-092

12. I agree that the loss of $106,000.00 is not a loss in which the husband should be required to share. This was not a case of the wife making mistakes because of a misunderstanding of how to complete BAS forms or had involved an isolated error. It arose solely because of the wife’s deliberate wrongdoing and continued for a period of six years. I take into account that:

    a)The ATO was satisfied after a very thorough investigation that the errors in the BAS statements were the result of an intentional disregard of the law;

    b)The wife was uncooperative in the ATO investigation;

    c)The wife displayed guilty knowledge in providing minimum and inaccurate information about the issue in her trial affidavit.

1. The loss arose independently of the husband. I reject the wife’s suggestion (insofar as it could be applied to years earlier than 2007) that she falsified the returns or accepted responsibility for the false returns because the husband threatened her or because she was afraid of him. The wife was not a witness of credit and I have found earlier that I do not accept her evidence that the husband was violent during the relationship.

2. The other aspect of the matter is that the loan of the $100,000.00 which saved the parties from potentially being the subject of debt recovery action and further losses including potential loss of the property was made by the husband’s mother and in line with decisions such as Gosper & Gosper must be treated as a contribution by the husband which got the parties out of trouble and preserved the property. [11]

   [11] Gosper & Gosper (1987)FLC91-818

The loan to Ms G & Mr R

1. The wife lent Ms G and Mr R $30,000.00 from the Property L sale proceeds in May 2011. It is irrecoverable and the husband said that he should not have to share in this loss either.

2. The wife acknowledged that it was her idea to help Ms G & Mr R out but she said that the husband agreed. The husband initially denied this but said in oral evidence that he agreed to lend $6,000.00 but no more.

3. The wife was not a witness of credit and I have no reason to believe her evidence that the husband concurred in the entire loan but the loan was made during the marriage and I am not inclined to treat it as the wife going on a frolic of her own even if the husband did not entirely agree with it. There was no evidence that it was apparent when loan was made that Ms G & Mr R would be unable to repay it and that the wife acted recklessly in making the loan.

4. The husband also alleged that the wife spent $5,000.00 carpeting the (omitted) which Ms G & Mr R owned immediately after separation. I am unclear about exactly what happened in this regard but if the money for this (if it occurred) came from money taken by the wife at the time of separation I have been asked to have regard to the wife’s receipt of this money as a separate issue and it would be double counting to penalise the wife separately for the use of the $5,000.00.

The alleged surreptitious sale of stock during the marriage

1. The husband alleged that on one occasion during the marriage the wife surreptitiously sold stock from Property L and retained the proceeds. The only “evidence” he had to support this claim was something Ms K said that she had heard and observed when she was a young teenager and on which the husband now sought to place a particular construction.

2. It is simply not open to me to find that there is any substance in a claim that the wife surreptitiously sold stock during the relationship.

Money taken/received by the wife post-separation

1. The husband’s counsel submitted that the wife had received over $681,000.00 of the parties’ funds post-separation and that this had to be taken into account in calculating a property settlement.

2. This submission is colourful and dramatic but misleading.

3. The largest part of this amount is the $460,000.00 which the husband allowed the wife to have from the Property L sale proceeds invested with the stock and station agent. The husband received the balance in the account which was $24,905.87.

4. The wife used $330,000.00 plus whatever was required to pay for stamp duty and conveyancing costs to purchase the Property J property. She also spent some of the remainder of the money doing extensive renovations to the property. She alleged that she had spent $127,222.37 doing painting, architraves, tiling, fencing, installing a new clothesline, a new roof on the verandah and a staircase. She also purchased furniture.

5. Property J is in the pool at its current value of $365,000.00. Clearly if the wife spent a substantial part of the additional $130,000.00 on renovations it is not reflected in the current value of the property.

6. It is not however open to me on the evidence to find that the wife wasted the difference between the purchase price and $460,000.00. The husband accepted that renovations had been done and as I observed to the husband’s counsel during submissions the cost of renovations and repairs often do not translate in dollar terms into an increase in the value of a property. Repairs may simply preserve the asset and stamp duty and conveyancing costs are an acquisition cost which is never going to show up as an increase in value.

7. Interestingly Property A1 was purchased for $1.9m and is now worth $1.610m. Nearly $300,000.00 has evaporated as a result of the parties’ purchase of Property A1.

8. If the $460,000.00 is put to one side then the wife is alleged to have had the benefit of another $221,000.00 but I cannot find all of this.

9. A red herring was introduced at one point through the fault of the wife because she asserted in her trial affidavit that the husband agreed that she could use a $34,461.76 tax refund received in October 2011 to pay for a trip to the (country omitted) for herself and Z and X and the husband latched onto this to suggest that the wife had sole use of the tax refund which was received close to separation and that it ought to be treated as part of her entitlement to a property settlement.

10. However the wife’s evidence was wrong because as she admitted during cross-examination the trip to the (country omitted) took place a year earlier and the money for that came from a difference source.

11. The refund cheque was deposited into the parties’ joint account on 31 October 2011.[12] Various withdrawals were subsequently made from this account and on 28 November 2011 the wife removed $20,000.00 leaving a balance of $8,764.08.

    [12] Exhibit J

12. In his spreadsheet the husband alleged that some of the withdrawals prior to 28 November 2011 benefited only the wife and said that he was unsure about others but I cannot hold the wife accountable for the entire $34,461.76. All that the wife can be required to account for is the $20,000.00.

13. The wife also received the following from the sale of cattle:

Date	Description	Value
16 January 2012	Proceeds of sale of cattle	37,762.51
12 September 2012	Proceeds of sale of cattle	12,082.18
21 December 2012	Proceeds of sale of cattle	14,450.74
February 2013	Proceeds of sale of weaners	20,646.98
February 2014	Distribution from sale of stock	10,000.00
Total	$94,942.41

1. She also received $33,621.70 from the sale of cattle on 21 September 2012 which it was agreed by orders made on 7 September 2012 would be taken into account as a partial property settlement.

2. In summary since separation the wife has had $20,000.00 from the partnership account, $94,942.41 from the sale of cattle, $3,631.00 from cancelling the insurance on Property A1 and retaining the refund cheque and $33,621.70 from the sale of other cattle, a total of $152,195.11.

3. None of this money remains, and it was the husband’s case that this should be treated as an advance on the wife’s property settlement.

4. The husband has also received money since separation as follows:

Date	Description	Value
25 January 2012	Proceeds of sale of cattle	37,762.52
15 May 2012	Distribution from investment account	24,905.87
13 September 2012	Interim distribution from cattle sales	20,000.00
21 December 2012	Interim distribution cattle sales	14,321.74[13]
3 February 2014	Interim distribution cattle sales	10,000.00
Total	$106,990.13

[13] The husband received $5,872.15 for expenses as well

1. The husband also has cattle to the value of $10,850.00 which he retained when the wife sold her half of a herd.

2. The husband was able to obtain, not without dispute on the wife’s part it is true, money to pay expenses before the balance received from the sale of cattle was divided. To suggest as his counsel did that since separation he had only received sufficient to buy cigarettes is colourful rather than true; it is not supported by the evidence. 

3. The husband did have a battle to obtain reimbursement of some of his expenses. He attached to his trial affidavit invoices from January 2013 onwards totalling $21,440.12 which he said were farm expenses which the wife had refused to allow him to deduct from the sale of stock.

4. When the hearing was adjourned on 13 March 2014 I made an order after argument that funds held in the trust account of the parties stock and station agent be used to pay the partnership tax liability of $10,339.12 and to reimburse the husband for expenses and that the husband thereafter pay the partnership expenses as they fell due either from partnership funds or if unavailable from his own funds.  To the best of my knowledge this disposed of the issue of the husband having unreimbursed expenses as this issue was not referred to by the husband’s counsel in final submissions. 

5. The wife also alleged that the husband had used an amount of diesel fuel since separation which was in excess of the needs of the farm and was used to pursue his own personal interests or those of Ms K.

6. I have considered the detailed evidence given by both parties about expenses incurred post-separation and it is simply not open to me to find that the husband has been profligate in his expenditure or that Ms K used excessive amounts of fuel. Nothing in the lifestyle of the husband or Ms K suggests that these allegations have any credibility.

7. In summary both the husband and wife had money at or after separation which has assisted them to meet living costs. The wife’s receipt of $3,631.00 from the cancelled insurance was perhaps ill-gotten gains but there is some merit in a suggestion that the wife had a somewhat more expensive task post-separation needing to set up a new home.

8. The husband’s counsel submitted that the wife should be required to accept the money received from cattle sales post-separation as part of her property settlement while the husband should not because the wife did not put any physical effort into working on the property. However as I observed to the husband’s counsel during submissions the wife’s capital was tied up in the property and the stock. I can see nothing wrong with the wife requesting a share of what she termed “partnership profits” but was in fact a distribution of capital and no reason why the wife should have to accept what she received as part of her entitlement but the husband should not.

9. If I accept, and I have no option but to do so, that the $460,000.00 was largely spent by the wife on Property J, and Property J is in the pool, then I can only potentially hold the wife to account for $152,195.11 and if I form the view, and I do, that the wife was entitled to share in the proceeds of sale of cattle after expenses were paid and that the husband also received a share of the proceeds after expenses were paid I cannot penalise the wife because she has spent her share of the proceeds rather than preserving it so that some could perhaps be included in the pool and partially redistributed back in favour of the husband.

10. Part of the tangled web in this matter is that some of this money may have been spent paying the wife’s legal fees. During cross-examination the wife said that she had paid her solicitors $33,000.00 or $35,000.00 but it seemed to me that some of this was in connection with the criminal charges and ADVO proceedings in (omitted). It is reasonable to suppose however that the balance was spent on living costs as the wife had no other income after separation.

11. The wife was unemployed when the relationship ended. The amount she received on the above figures averages to $1,026.00 per week tax free which should have enabled the wife to live at a very good level if she did not use the money to pay any other legal expenses but she needed money to live on. However I do not accept that any of this money should be treated as an advance on the wife’s entitlement to a property settlement when the husband received a not-insignificant amount for his own upkeep from the sale of cattle and retained $24,905.87 from the money in trust and none of this money is still in existence either.  

The money from the mining exploration licence and gravel pit

1. The husband complained that the wife received all the money from the mining exploration licences on Property L and from the sale of gravel and deposited them into an account in her sole name and it is true that this occurred.

2. The husband’s reconstruction of the deposits into the accounts in the wife’s name confirms that $24,750.00 was deposited into the account from (omitted) on 9 September 2009 and a total of $14,634.63 was received from (omitted) Council between 16 October 2009 and 21 May 2010. However according to the husband’s reconstruction the money in the account was used between these dates to pay for fuel, farm expenses, unidentified items, expenditure at (omitted) and (omitted) supermarkets (modest) and (omitted) stores, $2,000.00 on a credit card and $1,075,78 was spent on “Ms Britt’s expenses (assumed)”.

3. I cannot draw from this a conclusion that the wife misused these funds.

The wife’s gambling

1. The husband said that the wife had a serious gambling problem and that she lost a large amount during the relationship.

2. He said that on one occasion the parties received a $10,000.00 wheat cheque which was deposited into their bank account. He said that two days later the wife came to him and said:

   I’ve spent it all. I’ve been to the pokies. I don’t know what to do.

3. The husband said that the wife signed a self-exclusion agreement with two hotels to try to keep away from the poker machines.

4. The wife agreed that she played the poker machines at hotels during the relationship and admitted that it developed from a “form of amusement” into a habit and that gambling was a problem for her from 1997 until 2005 when she ceased gambling. She alleged that she lost about $2,000.00 per year and that the only source of funds for gambling was her wages and social security payments.

5. The wife alleged that she had some wins and used one winning to buy a small car for the children to drive from the farm to the bus stop and that the husband never complained about her gambling during the relationship.

6. The husband did not accept that the wife’s losses were as small as she claimed. He said that in or about 2006 the parties received $16,061.50 received from the Natural Heritage Trust to plant a tree corridor across Property L for the preservation of Koalas.  The money was not used for this purpose and the husband implied that he suspected that the money had been used for gambling.

7. The wife agreed that the National Heritage Trust money was used for purposes other than intended by the grant but said it was because of financial necessity. She said that it was spent on food, household expenses, car expenses and vehicle costs and denied that any of it was spent on gambling.

8. The wife provided a Passbook showing this money going in and showing various withdrawals. Some were for cash but there were also cheques or withdrawals for amounts which suggested payment of bills and I cannot be satisfied on the balance of probabilities that the wife’s version of events is untrue.

9. The husband also alleged the wife sold the Toyota (omitted) motor vehicle the parties owned for $17,000.00 and pocketed the cash. He said that the wife told him at the time that she had traded the Toyota (omitted) in on a Ford but he later discovered that she had sold the Toyota (omitted) for cash and taken out a loan for the entire purchase price of the Ford.

10. The wife said that she used the cash to partly repay the loan for the new motor vehicle. No documents were produced which dealt with this issue and I cannot use the wife’s lack of credit to make the case asserted by the husband based on suspicion. 

11. Property L does not seem to have provided the parties with a great deal of income. They were never able for example do up the house on the property and I cannot exclude the possibility that the wife used money from the National Trust or the sale of the Toyota (omitted) to meet some of the parties living costs.

12. The wife was not a witness of credit but the husband’s evidence does not allow me to make definitive findings about the extent of any gambling losses. Another difficulty is that if she was gambling the wife may have used some of the money obtained as a result of the false GST returns to fund her gambling and I have to be careful not to double count by penalising the wife for the fines being incurred and also for gambling away the ill-gotten gains.

13. There is little I can do about the gambling allegations in the absence of solid evidence about what was lost.

The husband’s circumstances

1. The husband is 65. He opened his own (omitted) business in 1970 when he was 21 but he has poor literacy skills and his life for the last 40 years has been on a farm with other people doing the bookwork.

2. At trial the wife was equivocal about her acceptance that the husband had literacy problems. However in her trial affidavit in the context of claiming that she did all the bookwork for the farming enterprises she said as follows:

   Mr Britt…is a poor reader and writer and unable to fill out forms such as an application for drought relief. I always did these things for him. At the time we separated he was unable to use a computer at all.

3. The records of interview between the wife and the ATO at the time of the investigation into the BAS lodgement issues also contains the following:

   Ms Britt advised that she prepares and signs BAS because Mr Britt is illiterate

4. I accept that if the farm is sold it is unlikely that the husband will be able to obtain much by way of employment given his age and likely capacity for physical work. I accept that he has literacy issues but given his normal occupation this is not of relevance to his employability.

5. The husband is in a relationship with Ms K who is 38. She has been living with the husband at Property A1 since 27 January 2012 and she and the husband have a child A born on (omitted) 2014.

6. Ms K has a (omitted) business called “(omitted)” but it appears to trade very little. She has few assets.

7. Pursuant to s.75(2)(d)(a) and s.75(2)(e) I am required to take into account the commitments of a party which are necessary to enable the party to support a child or another person who the party has a duty to maintain and also the responsibilities of either party to support any other person.

8. The husband has a responsibility to support his child with Ms K and a responsibility to support Ms K if he is in a de facto relationship with her to the extent that she is unable to support herself by reason of her care of the child, but Ms K also has a responsibility to support herself and a responsibility to support the child.

9. In August 2014 Ms K described her occupation as “Mother” but she owns horses and has some aspirations to earn something with the horses. There was nothing to suggest that this was likely to be a lucrative business. She said that she had sold one horse for $1,650.00 since she commenced living with the father. However Ms K is relatively young and is able bodied and there was nothing to suggest that subject to child care requirements she would be unable to earn any sort of income in the future.

10. The husband will have sufficient, either from retaining the farm or from selling the farm and obtaining the capital to which he is entitled, to support Ms K and A to the extent that he is obliged to do so. S.75 (2) makes a clear distinction between the responsibility of parties to support children of a marriage and their responsibility to support any other child or person. I do not accept that the husband can expect to receive an adjustment in his favour in respect of the property owned by himself and his wife to assist him to support his new wife and child.

11. In his financial statement the husband estimated his current income at $400.00 per week although it is difficult to know where this figure comes from as the partnership tax returns showed a profit of $5,600.00 in 2011 and a loss of $1,687.47 in 2012.

1. During cross-examination the husband said that he had no real idea of his weekly income. He said:

   What am I getting off the place? Hardly anything. All I do is pay bills. All I am living on is Centrelink

2. The husband said that he and Ms K received $937.40 per fortnight from Centrelink.

3. The husband is apparently content to live on this as he would prefer not to free up the capital in Property A1 if he can avoid it.

4. If the husband retains Property A1, the livestock, plant and equipment, his utility and household contents he will be required to pay the wife $708,251.20.

5. The husband’s solicitors estimated that his total legal fees would be about $110,000.00 and he will have to fund this on top of any money he is required to pay to the wife.

6. When the hearing commenced the husband had 21 (omitted) steers and 4 calves in his possession value at $10,850.00 and also some old plant and equipment left out of the pool because he received it from his family.

7. In his financial statement the husband said that he owed his mother $70,000.00 for “expenses.” During the hearing further information was provided about this and about $58,000.00 of this was for legal costs and the balance for farm related and living expenses.

Conclusion about s.75(2) matters

1. Each party sought a s.75 (2) adjustment in their favour.

2. Factors which favour the wife are the length of the marriage and the fact that she left school very young and before completing year 10 to live with the husband, bring up children and work on the farm. She has no qualifications to assist her to obtain paid employment and her work skills are in a limited area. The marriage has had an impact on her income earning capacity.

3. Factors which favour the husband are that he is similarly limited by his skill set in terms of obtaining employment in the future other than on the farm and in addition his age is likely to be against him. While there is some realistic possibility of the wife obtaining work in the future the chances of the husband doing so are slim. The husband may have to make do with whatever capital he obtains from the settlement to see him through for the rest of his life; the wife has some prospect of being able to preserve some capital by obtaining employment.

4. The s.75(2) factors to this point therefore slightly favour the husband and the other matter which favours the husband is that the wife must be brought to account for the loss of $106,000.00 as a result of her conduct with the GST returns.

5. To bring the outcome for the husband up to the amount the husband’s counsel proposed however would require an adjustment of nearly 25% in his favour. This would equate to $551,877.50 and create a differential of $1,103,755.00 between the parties.

6. Unless Property J is also sitting on a coal deposit, and even then, there is no remote likelihood that in 16 plus years or so of potential working life which remain to her the wife will acquire this kind of money. It is also not necessary for the husband to have this additional amount in order for him to maintain a reasonable standard of living and it is an extremely disproportionate response to the wife having caused a loss of $106,000.00 to the pool.

7. A proportionate response in light of the wife’s lack of qualifications and limited education and limited skills, all flowing from her early marriage, is an adjustment of 5% in the husband’s favour.

8. This gives the husband an additional $110,375.50 and creates a differential of $220,751.00 between the parties. It takes account of the missing $106,000.00 and the fact that wife has 16 years plus ahead of her in which she has some prospect of being able to obtain employment and preserve capital for her retirement (if she chooses to do so).

9. This would entitle the husband to 55.05% of the pool or $1,215,234.20 and the wife to 44.95% or $992,275.74. It will require the husband to pay the wife $597,875.74 if he wishes to retain Property A1.

10. It will result in the wife receiving the following:

    Property J  365,000.00

    Toyota (omitted)   27,000.00

    Household contents  2,000.00

    Quad Bike     400.00

    Payment from husband                597,875.74

    Total  992,275.74

11. The wife will be left with an unencumbered home and a capital sum to invest or spend as she chooses, subject to paying any outstanding legal fees.

12. The husband will receive:

    Property A1   1,610,000.00

    Stock        148,365.00

    Plant and Equipment   42,745.00

    (omitted) Utility   10,000.00

    Household contents   2,000.00

    Subtotal   1,813,110.00

    Less payment to wife       597,875.74

    Total     1,215,234.26

13. The husband will be left with a possibly encumbered property but if he chooses or is forced to sell with ample capital to re-house himself and to assist in supporting himself and as required Ms K and his daughter A subject also to paying any outstanding legal fees.

Orders

1. I intend to make orders giving the husband the opportunity to retain Property A1 if he is able to pay this amount to the wife. He insisted that he would be able to do so although he refused to be drawn on which whether he could pay her more than $157,000.00.

2. I will order that if the husband is unable to pay the amount then Property A1 be sold.

3. I am conscious of the fact that Property A1 is in fact two properties and that perhaps an option is for one property to be sold and the husband to retain the other but this is sheer speculation on my part. This issue was not addressed at the hearing and I have no option but to order that the combined Property A1 property be sold if the husband cannot pay the wife.

4. I cannot tailor the outcome to give the husband the best chance of retaining Property A1 even if I was sure what amount would ensure that. The wife is entitled to a just and equitable share of the property after a 30/31 year relationship which began when she was only 15 or 16 years old and to which she devoted, to use an old phrase, the best years of her life.  

5. The parties did not address the issues of what orders should be made about the partnership and stock and equipment if Property A1 had to be sold.

6. Six months have passed since the hearing and even longer since the cattle and plant and equipment were valued and I consider the appropriate outcome is to order that the husband immediately become the owner of the stock and plant and equipment as they currently stand regardless of what happens to Property A1. He can at his election either sell them later if Property A1 has to be sold or take some of them with him, subject to a cash adjustment in the wife’s favour from the sale of Property A1.

7. In her affidavit the wife said that she sought an order that the husband deliver certain items of property to her. The husband denied that he had these items and said that the wife had taken everything she wanted soon after separation. I cannot determine that the husband is being untruthful and it would be pointless me making an order for these items to be transferred to the wife.

8. I am satisfied that the outcome is just and equitable and for the reasons given above the orders will be as set out at the beginning of this judgment.

I certify that the preceding two hundred and sixty three (263) paragraphs are a true copy of the reasons for judgment of Judge Terry

Associate:  

Date:  30 March 2015

   November 2011. Nothing turns on which is correct.    to separation. Bank records suggest the wife visited (omitted) regularly in the months before
   separation but I cannot make a finding about when the relationship commenced and nothing turns on   
   it.