BURKE & BURKE
[2021] FamCA 1
•15 January 2021
FAMILY COURT OF AUSTRALIA
| BURKE & BURKE | [2021] FamCA 1 |
| FAMILY LAW – PROPERTY SETTLEMENT – Just and Equitable – where this is a marriage of more than 20 years – where both parties have re-partnered – where the parties operated a business during the marriage – where the husband made significant initial contributions that enabled the parties to accumulate the asset pool that is currently available for division – where there is an adjustment to the husband on the basis of these initial contributions – where there is an adjustment to the wife based on the section 75(2) factors – where overall there is a 52/48% split in the husband’s favour. FAMILY LAW – PROPERTY – Transaction to defeat claims – where the husband sold a number of vehicles post-separation – where it has not been satisfied on the balance of probabilities that these transactions were a sham – where it is found that the husband sold the vehicles for less than their market value as valued by the Single Expert – where although the vehicles were sold for less than market value and in the face of the wife’s objections the evidence falls well short of establishing that the husband acted negligently or recklessly with an aim to reduce the value of the assets – where there is no further adjustment – where the sum the husband sold the vehicles for is taken into account as a section 75(2) factor. FAMILY LAW – PROPERTY – where the husband and his two brothers were each transferred a share of their father’s property - where there is a life interest granted to the husband’s father – where neither party in these proceedings made any contribution to the property – where the wife asserted this property should be included as property within the pool – where this is disputed by the husband – where this property is treated as an asset in a separate pool of property and taken into account as a section 75(2) factor in favour of the husband. |
| Evidence Act 1995 (Cth) s 140 Family Law Act 1975 (Cth) s 75, 79, 106A |
| In the Marriage of Kowaliw & Kowaliw (1981) FLC 91-92 Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 Omacini & Omacini (2005) FLC 93-218 Pierce v Pierce (1999) FLC 92-844 R v Watson; Ex parte Armstrong (1976) 136 CLR 248; [1976] HCA 39 Stanford & Stanford (2012) 247 CLR 108; (2012) FLC 93-518 |
| APPLICANT: | Ms Burke |
| RESPONDENT: | Mr Burke |
| FILE NUMBER: | DGC | 2799 | of | 2017 |
| DATE DELIVERED: | 15 January 2021 |
| PLACE DELIVERED: | Melbourne |
| PLACE HEARD: | Melbourne |
| JUDGMENT OF: | Macmillan J |
| HEARING DATE: | 29 June 2020 - 1 July 2020 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Ewan Hall |
| SOLICITOR FOR THE APPLICANT: | David Wilkinson and Co |
| COUNSEL FOR THE RESPONDENT: | Mr David Carne |
| SOLICITOR FOR THE RESPONDENT: | Davison Family Lawyers |
IT IS NOTED that publication of this judgment by this Court under the pseudonym Burke & Burke has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT MELBOURNE |
FILE NUMBER: DGC 2799 of 2017
| Ms Burke |
Applicant
And
| Mr Burke |
Respondent
REASONS FOR JUDGMENT
Introduction
For over 3 years the parties in this case have been involved in highly contested litigation, in particular with respect to which one of them should retain the former matrimonial home and what should happen with respect to the business the husband has operated from the former matrimonial home both during the relationship and following separation. Issues which they ultimately resolved during the course of the hearing. There was also a significant dispute with respect to a number of vehicles sold by the husband, the wife’s case being that those transactions are a sham. This particular issue is indicative of the level of disputation and mistrust between the parties.
Background
Although there remained issues about which the parties could not agree much of the history of their relationship was not in dispute. The parties in this case commenced cohabitation in 1995 and were married in 2000. There are two adult children of their marriage. The parties separated in January 2017.
The husband is 57 years of age. He is a tradesperson and started his own business in 1985 prior to the commencement of cohabitation. On 18 October 2001 Burke Company was incorporated and began trading as Burke Company Pty Ltd (“the business”). The parties were both directors and equal shareholders. In the latter years of the relationship the husband conducted the business out of a separate custom built workshop located on the property at B Street Suburb C (“B Street property”). The wife was involved in the administration of the business.
On 5 May 1986 the husband became the registered proprietor of the property at D Street F Town (“F Town property”). The wife moved into the F Town property when the parties commenced cohabitation in 1995 by which time the mortgage had been discharged. Although the wife did not dispute that the husband owned this property there was a dispute as to its value at the commencement of their relationship.
The husband’s case is that in 1993 his father also gave him a block of land at H Street Suburb C (“H Street Property”) albeit the property was not formally transferred to his name until 30 May 1999.
In 1998 the parties purchased Workshop 1, G Street Suburb C (“Workshop 1”) which was registered in the husband’s name. Thereafter the husband ran his business from Workshop 1. The property has been valued at $455,000 and is unencumbered.
In 1999 the husband sold the F Town property for $120,000. He put the net proceeds of sale towards the costs of building a new house on the H Street property. The husband also deposes that after the house was completed that he and the wife purchased the adjoining land. It is the wife’s case that they did not buy the adjoining land until 2003.
In 2001 the parties purchased Workshop 2, G Street Suburb C (“Workshop 2”) which was registered in his name. Workshop 2 is valued at $440,000 and is unencumbered.
On 9 January 2002 the husband’s father executed a declaration of Trust in relation to the property at J Street Suburb C (“J Street property”) and on 12 February 2002 the husband became one of three registered proprietors of the J Street property. The other two registered proprietors are the husband’s brothers and together they hold their interests as tenants in common subject to a life interest to the husband’s father who lives in the property. The husband’s interest in the property subject to that life interest is valued at $162,000.
The husband says that he sold the H Street property and adjoining land in 2005. The wife’s evidence is that it was sold in 2003. There is nothing significant that turns on the dispute as to the date of sale. The proceeds of sale were used to purchase the B Street property. The B Street property is registered in the joint names of the husband and the wife and although it was used as security for a loan for one of the children it is otherwise unencumbered. The parties did extensive renovations to the B Street property including a second self-contained one bedroom dwelling and another one bedroom dwelling that was added to the existing cottage.
In 2011 the parties purchased Workshop 3, G Street Suburb C (“Workshop 3”). Workshop 3 is registered in the joint names of the parties and is unencumbered. It has been valued at $315,000.
On 1 September 2017 the wife commenced proceedings in the Federal Circuit Court of Australia.
On 20 November 2017 Interim Orders were made by Judge O’Sullivan. These orders provided for:
a)Disclosure by both parties;
b)That until further order both parties be restrained from encumbering or selling any other asset save for in the ordinary course of business dealings, legal fees and reasonable living expenses;
c)That the parties have a mediation with a private mediator to be agreed at the joint cost of the parties;
d)That the wife shall deliver to the husband the motor vehicle 5 and a business vehicle to the company;
e)That until the adjourned hearing the husband acknowledges that the wife retains the control of the motor vehicle 1 and motor vehicle 2 and motor vehicles 3 and 4 belonging to the children, and respectively the wife acknowledges that the husband retains the possession and control of the four business vehicles including the motor vehicle 5, motor vehicle 6 and motor vehicle 7;
f)That the parties confirm in writing agreement the current value of the B Street property, workshops, J Street and the business and if they are unable to agree a joint valuation be undertaken at equal expense of the parties; and
g)That the parties withdraw the current amount in the K Bank Account being approximately $25,629 equally with such sums to be acknowledged as a part property settlement for each party.
On 3 April 2018 the matter was listed for a final hearing commencing in March 2019 but on 4 April 2019 was transferred to this Court.
On 31 May 2019 Registrar George made orders setting the matter down for a first day mention. Consent Orders were made inter alia on this date in relation to the expert witnesses in relation to the plant and equipment and J Street property. A notation was also made to these orders that the husband intended to obtain an estimate as to the potential Capital Gains Tax “CGT” implications of the sale of all or any of the B Street Workshops from L Accountants. It was further noted that it was the wife’s position that CGT will be ascertainable only upon the actual sale.
On 19 July 2019 I made the following orders whilst also setting the matter down for a final hearing to commence in December 2019:
a)Orders in relation to the asking of questions to Mr M in relation to his valuation of the business;
b)That the parties jointly appoint Mr M to provide a separate letter reporting upon the capital gains tax that would be payable upon the sale of workshops 1, 2 and 3 and such CGT advice to assume that sale prices accord with the sworn values provided by W Solicitors in March 2019 and to be completed and released by September 2019; and
c)Within 7 days the parties at their joint expense instruct Mr P to value all stock, plant and equipment owned by the business and situated at the B Street property as well as any other chattels in or about the B Street property including the wife’s farm and animal equipment and her two animal.
On 25 May 2020 the matter was set down for a final hearing to be conducted via video-link over Microsoft Teams commencing on 29 June 2020. Ancillary orders were made in relation to the timeline for the filing of documents and expert evidence.
On 23 June 2020 the parties received an offer from X Pty Ltd to purchase Workshop 1 for $450,000 and Workshop 3 for $350,000. X Pty Ltd are the current tenants of Workshop 2.
The final hearing commenced on 29 June 2020 and on 1 July 2020, the final day of the trial, I made the following orders inter alia by consent:
a)That the husband be restrained from removing any chattels from the B Street property; and
b)That Factories 1 and 3 be sold, and after payment of the costs of the sales an amount be quarantined to meet any CGT arising from the sale (to be determined on the advice obtained of Mr M) and the balance of the net proceeds to be thereafter held in trust on behalf of the husband and wife pending further order.
It was further ordered on 1 July 2020 that:
a)Pending any transfer or sale of the B Street property the husband shall be at liberty to continue to attend the property within the confines of the Intervention Order made in the Magistrates Court pending the full implementation of these orders or 31 December 2020 whichever is earliest;
b)The wife shall otherwise have the sole use and occupation of the B Street property and shall be liable for all rates, taxes and outgoings for that property save and except for the separately metered utilities used by the business and one half of the water bill for the property; and
c)The matter was otherwise adjourned for a date to be fixed for judgment.
Evidence
The standard of proof is the balance of probabilities and pursuant to s 140 of the Evidence Act 1995 (Cth) in determining whether the parties have met the requisite standard the Court must take into account the nature of the cause of action or defence, the nature of the subject-matter of the proceedings and the gravity of the matters alleged.
The wife relied upon the following documents:
a)Amended Initiating Application filed 8 July 2019;
b)Affidavit of Ms Burke filed 6 March 2020;
c)Affidavit of Ms Burke filed 1 May 2020;
d)Financial Statement filed 6 March 2020; and
e)Affidavit of Mr N filed 6 March 2020.
The husband relied upon the following documents:
a)Amended Response filed 8 March 2019;
b)Affidavit of Mr Burke filed 17 April 2020; and
c)Financial Statement filed 17 April 2020.
Both parties relied upon the evidence of the expert witnesses and had agreed upon the value of the various items of property based upon their evidence save and except with respect to the valuation of the vehicles sold by the husband following separation. Mr V prepared a Single Expert Report dated 10 June 2020 in relation to the motor vehicles. Although it was the husband’s case that he sold the vehicles for fair value Mr V was not required for cross-examination.
The only issue which turned to any significant extent on the credit of the parties was in relation to those vehicles sold by the husband following separation and whether the value of those vehicles, $318,000 according to the evidence of Mr V, or alternatively the $120,000 the husband received, should be treated as an add back to the pool. At the commencement of the hearing, as set out in her Outline of Case, it was the wife’s case that the $318,000 being the value attributed to the vehicles by Mr V should be added back to the pool. Although arguably in these circumstances the amount to be added back would be the difference between what the wife says was the real value of the vehicles and the amount the husband sold them for the wife in her Case Outline also raised the possibility that the sales were a sham and that the $120,000 the husband says he was paid by the purchasers also came from matrimonial funds. On that basis the wife’s case appeared to be that both the $318,000 and the $120,000 should be added back to the pool.
Although I found the wife’s case somewhat confusing her case at the conclusion of the hearing appeared to be that the $318,000 rather than the difference between the $318,000 and the $120,000 should be added back to the pool because the $120,000 came from joint funds.
It is common ground that throughout the marriage the husband bought and sold classic vehicles and in 2017 sold a number of vehicles as follows:
a)On 10 October 2017 the husband sold the orange motor vehicle 10 (unregistered) for $20,000.
b)On 23 October 2017 the husband sold the yellow motor vehicle 10 (unregistered) for $20,000.
c)On 31 October 2017 the husband sold the orange motor vehicle 10 (unregistered) for $20,000.
d)On 2 November 2017 the husband sold motor vehicle 8 (unregistered) for $20,000.
e)On 4 November 2017 the husband sold the red motor vehicle 10 (unregistered) for $20,000.
f)On 4 November 2017 the husband sold the white motor vehicle 10 (unregistered) for $20,000.
The wife’s case is that the husband sold the vehicles notwithstanding:
a)That on 25 May 2017 the parties had agreed, confirmed by an exchange of letters between their solicitors, that they would not dispose of any matrimonial property;
b)That on 28 June 2017 her solicitor had written to the husband’s solicitor proposing that the vehicles be valued;
c)That by letter from his solicitor dated 22 August 2017 the husband refused the wife’s request that the vehicles be valued;
d)That on 1 September 2017 the wife commenced the proceedings in the Federal Circuit Court of Australia, seeking inter alia orders for the valuation of the vehicles and orders restraining the husband from selling or disposing of them; and
e)That on 7 September 2017 the wife’s application was served upon the husband via his solicitors.
The husband’s case is that he sold these vehicles to meet ongoing living and business expenses, the income of the business having been effected by his health issues and ability to work, the business having lost a key employee and him having to familiarise himself with the management of the business finances which had previously been managed by the wife. The husband further deposed to having used, as he had done during the marriage, a collector’s magazine to determine the value of the vehicles he sold. It was his evidence that the ‘Y Company’ value guide, which he annexed to his affidavit (Annexure ‘A’), estimated the value of the motor vehicle 10’s at between $3,990 for an unrestored vehicle and $9,025 for a fully restored show vehicle. It was his case on this basis that the $20,000 he received for each of the motor vehicle 10’s was well above the range. He also said that motor vehicle 8 which he sold for $20,000 had no interior, trims and was not fully restored. I will address the question of the value of these vehicles in more detail later in these reasons.
The husband was cross-examined at length in relation to this issue and in particular the bona fides of the various sales having regard to the wife’s case that the purported purchasers did not have the financial capacity to make these purchases. Counsel for the wife submitted that the husband’s evidence should not be believed absent independent corroboration. Although I accept that the husband has some reading difficulties I am satisfied that notwithstanding those limitations the husband would have known that the wife would object to and in fact had taken steps to prevent the sale of assets and that this would have included these vehicles. Although the husband was not particularly forthcoming in cross-examination in relation to this issue I do not accept that he was otherwise not a credible witness or that, absent corroboration, I should not accept his evidence.
I am equally satisfied that although the wife was at times overly focused on the way in which she put her case tailoring her evidence to advance that case and had some difficulty making concessions, she was generally a truthful witness. However, in my view there were aspects of the evidence of both parties that demonstrated the extent to which they had been focused on their dispute and their perspective of that dispute.
The other aspect of the issue with respect to the sale of the vehicles from an evidentiary point of view was in relation to what the wife says was the husband’s failure to call evidence from the purchasers of the various vehicles it being her case that on that basis the Court could infer based upon the rule in Jones v Dunkel (1959) 101 CLR 298 that the transactions were a sham. It is difficult on the one hand to understand why the husband would not have adduced evidence from at least some of these potential witnesses including his partner and friends with whom he had regular and recent contact, however I accept as submitted by the counsel for the husband that whilst a parties failure to adduce evidence may allow the Court to infer that the evidence that a party failed to adduce would not have assisted their case there must also be evidence based upon which the Court might draw that inference. In my view that is not the position in this case. Although the wife asserts that the transactions are a sham based upon some of the purchaser’s bank records she did not adduce any evidence in support of her assertion that the husband was the source of the funds used to acquire the vehicles. In particular there is no evidence before me of any funds passing between the husband and any of the purchasers that would support the wife’s assertion. In all of the circumstances and weighing up all the evidence I am not satisfied on the balance of probabilities that the transactions were a sham or as the wife suggests the husband provided funds that would otherwise be included in the asset pool to the purchasers or that once the proceedings are over that the vehicles will be returned to him. This is also not consistent with the evidence of Mr V, as reported to him, that at least three of the vehicles have been on sold.
I will also address the question of whether the difference between Mr V’s valuation of $318,000 and the $120,000 the husband received should be added back to the pool and how the $120,000 the husband said he received should be dealt with later in these reasons.
Legal Principles
Section 79(2) of the Family Law Act 1975 (Cth) (“The Act”) requires the court to be satisfied that it is just and equitable to make orders adjusting the parties’ interests in property. There are many cases in which this requirement is easily satisfied and as conceded by counsel, each party seeking orders pursuant to s 79 of the Act, this is such a case. The parties separated in 2017 yet still own property and a business together and I am satisfied that it is just and equitable to make orders adjusting their property interests in order to bring their ongoing financial relationship to an end.
The Court being satisfied that it is just and equitable to make property orders must make such orders as it considers appropriate. Whilst the court has a broad discretion as the plurality in Stanford & Stanford (2012) 247 CLR 108 (at page 121) observed, citing R v Watson; Ex parte Armstrong (1976) 136 CLR 248 (at page 257) it is not an unfettered discretion and must be exercised “in accordance with legal principles, including the principles which the Act itself lays down.” Section 79(4) of the Act provides as follows:
In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
• The financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
• The contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of the last-mentioned property, whether or not that last mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
• The contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
• The effect of any proposed order upon the earning capacity of either party to the marriage; and
• The matters referred to in subsection 75(2) so far as they are relevant; and
• Any other order made under this Act affecting a party to the marriage or a child of the marriage; and
• Any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
Section 79(4)(e) of the Act is a reference to the matters in s 75(2) of the Act in so far as they are relevant to the circumstances of the particular case.
Issues in Dispute
As previously referred to by the end of the hearing the parties had reached agreement in relation to several of the outstanding issues with the husband having prepared a minute of the orders he sought and the wife then making amendments to that minute based upon her proposals.
The husband’s case is that ultimately the property pool, albeit there was still some dispute as to what should be included in the pool, should be divided 55/45 in his favour. It is the husband’s primary position that the J Street property occupied by his father in which he has one third interest subject to his father’s life interest is a financial resource and not property. The wife seeks an equal division of assets. It is her case that the J Street property is an asset and should be included as such in the asset pool available for division between the parties.
Apart from the percentage division of their property and whether the J Street property should be included in the asset pool or treated as a resource the other issues the court is required to determine are as follows:
a)Whether the $318,000, the figure the vehicles sold by the husband were valued at by Mr V, or any lesser sum should be added to the asset pool;
b)How the $120,000 the husband received from the sale of the vehicles should be treated;
c)What if any adjustment should be made for the rental income retained by the husband;
d)What if any adjustment should be made for the funds withdrawn and expended by the wife following separation; and
e)Whether the husband’s bank account balances should be included in the asset pool.
The J Street property
The J Street property was transferred to the husband and his two brothers by their father in or about 2002. The husband and his brothers granted their father a life interest in the property at that time. The husband’s father is 82 years of age. The husband’s 33.3 per centum remainder interest in the property has been valued by a single expert for the purposes of these proceedings at $162,000 (Affidavit of Single Expert Witness Mr Q dated 23 August 2019). It is the husband’s evidence that neither he nor the wife have made any financial contribution to the J Street property. This is not disputed by the wife.
Although I accept that the husband’s interest in the J Street property is property it is an asset to which neither of these parties has contributed and in that sense is different to the other assets in the asset pool. In my view simply including the property in the general asset pool would not give adequate recognition to the circumstances in which the husband came to have an interest in it potentially indirectly giving the wife an entitlement based upon the husband’s interest in the property in circumstances where she has made no contribution either direct or indirect to that particular property. In all of the circumstances I propose to include the J Street property as an asset in a separate pool of property.
The Motor Vehicles Sold By The Husband
As previously referred to I had some difficulty following the way in which the wife put her case in relation to the vehicles sold by the husband however although I have found that I am not satisfied on the balance of probabilities that the transactions were a sham there is still a dispute as to whether or not the vehicles were sold for less than their value. Although Mr V did not have access to all of the vehicles for the purposes of his valuation and had to rely upon photographs for those vehicles he could not inspect his valuation of $318,000 for those vehicles was not the subject of any challenge. On that basis I am satisfied that the husband sold the vehicles for $198,000 less than their value.
The relevant question in these circumstances is whether he did so for what he believed was fair value or whether as described by Baker J in In the Marriage of Kowaliw & Kowaliw (1981) FLC 91-92 (“Kowaliw”) where the husband had embarked on a course of conduct designed to reduce or minimize the effective value or worth of the assets or in the alternative has acted recklessly or negligently with the assets which has resulted in their value being reduced of minimized. The wife’s case being that the Court being satisfied he had done so that the value of the vehicles should or be either added back to the asset pool or some adjustment made pursuant to s 75(2)(o) of the Act.
Whilst the husband was cross examined at length about his knowledge of having agreed not to dispose of any assets and the wife’s application for an injunction preventing him from doing so and the purchasers ability to pay for the vehicles he was not cross-examined in any detail about the price at which he had sold the vehicles and how he had determined the price. In particular his evidence in relation to the Y Company value guide was not challenged.
Although I have found that the vehicles were sold for less than the value attributed to them by Mr V, were sold in the face of the wife’s objections and prior to them being valued and that the husband initially invested the proceeds of sale, which is inconsistent with his case that he needed the proceeds to meet ongoing living and business expenses, in my view the evidence falls short of establishing that the husband either embarked on a course of conduct designed to reduce the value of the asset pool or acted negligently or recklessly which has resulted in the value of the assets being reduced or minimized. Whilst the husband may have wanted the vehicles sold it does not necessarily follow that he set out to sell them for less than their value. On that basis I am not satisfied that the $198,000, being the difference between the $120,000 the husband received and Mr V’s valuation, should be added back to the pool. I am satisfied however that the $120,000 the husband received upon the sale of the vehicles received should be taken into account pursuant to s 75(2) of the Act.
Legal Fees
As previously referred to the husband has had the benefit of the $120,000 he received following the sale of the vehicles and rental income from the three workshops. The wife for her part has had the benefit of the $127,000 she withdrew from the business account. It is the wife’s case that to the extent that the parties have used the funds they each received or retained to pay their legal fees that those amounts are as described by the Full Court of the Family Court of Australia (“the Full Court”) in Omacini & Omacini (2005) FLC 93-218 in a different category and should be treated in effect as advances on their entitlements and added back to the asset pool.
The wife’s costs letter referred to her having paid $34,500 of the $127,000 she withdrew towards her legal fees. However in her Case Outline the wife said that she had used $22,847 of the $127,000 for legal fees. Whilst the husband’s cost letter did not detail the source of the funds he used to pay his current solicitors he deposed that from the proceeds of sale of the vehicles he “… paid outstanding fees to my previous lawyers. I repaid a further $10,000.00 to the company that I had used for previous legal fees...”. Although the husband’s current solicitors said that his legal fees at the commencement of the hearing were $85,393, it would seem that this may not have included the fees of any previous solicitor. Although the wife said in her Case Outline that as at 22 July 2019 the husband had paid his former solicitor $52,799 and his current solicitors $21,653 there was no evidence before me in relation to this matter. It is impossible in all of the circumstances to determine exactly how much of the $120,000 the husband received on the sale of the vehicles he used to pay legal fees that might be added back to the asset pool or for that matter how much of the $127,000 the wife applied to her legal fees. In my view it would not be just and equitable in these circumstances to add back the parties’ legal fees. Rather than adding back any amount they may each have spent on legal fees, I propose to take into account the amounts they each withdrew or retained for their own benefit.
The Husband’s Bank Accounts
The wife’s case is that the husband’s current bank account balances, a total of $16,793, should be included in the asset pool. At the time the husband completed his Financial Statement he had two accounts in his name one with the Commonwealth Bank with a balance of $12,148 and the other with the K Bank which had a balance of $1843, a total of $13,991. The other accounts identified by the husband in his Financial Statement are accounts in the name of Burke Company Pty Ltd and will be accounted for on the winding up of the business.
The wife in her Financial Statement deposes to having a Commonwealth Bank account with a balance of $2,000. Although the court must determine the matter based upon the parties financial positions as at the date of hearing in my view in circumstances where the parties have been separated since January 2017 and maintained their own finances since that separation I am satisfied that it is not appropriate to include either of their accounts which are most likely referable to the income they have each earned and reflects their expenditure since separation. In my view the parties should not generally be accountable to each other for their income and expenditure post separation.
The Business
Mr M valued the business in his Single Expert Report dated 19 February 2020 both as a going concern and also on the basis of its liquidation. Mr Z opinion was that on a liquidation basis that value was $495,790 which was made up of cash at bank as at 30 June 2019 of $355,908 and fixed assets with a written-down value of $139,882. There is also interest earned on a term deposit of approximately $4,261 as at 30 June 2019. Mr P valued the plant and equipment and the other chattels located at the B Street property at $355,300. Of that figure it is agreed that the wife will retain items valued at $114,550 albeit it is her case that an amount of $1,000 should be deducted for a business owned by Ms R and $2,500 for a bedroom suite owned by Mr N. There is no evidence with respect to the ownership of these two items and as they are to be retained by the wife I propose to include them. The balance of the plant and equipment is to be sold. Deducting the value of the items the wife is to retain from the figure of $355,300 I propose to include the plant and equipment at a figure of $240,750. The parties have also agreed upon the sale of the S Limited shares owned by the business.
On this basis the liquidation value of the business is approximately $600,919. The value which I have included in the asset pool for the purposes of the Court’s determination is an indicative value and ultimately the amount available upon winding up will depend on the prices realised upon the sale of the plant and equipment and any additional interest earned on the term deposit since 30 June 2019 and winding up.
Tax Implications
Although there was evidence as to the possible tax implications based upon the distribution of business assets to the husband upon liquidation the parties acknowledge that there may be more tax effective ways for those funds to be distributed. There was no evidence based upon which the Court could determine even an indicative figure and it was agreed that before making orders the parties would have the opportunity to make further enquiries of their accountant with a view to making whatever orders the Court ultimately makes tax efficient.
In his report dated 20 November 2019 Mr Z said that the likely capital gains tax liability with respect to the workshops “…is in the range $126,447 to $130,932. This liability would be incurred on factory units 1 and 2 only and by Mr Burke. No material liability would occur in relation to factory unit 3.” The CGTG liability will of course depend upon a number of factors including the sale price and this figure is only a guide.
Superannuation
In circumstances where the parties have similar superannuation entitlements and neither party is seeking splitting order and I do not intend to include the superannuation in the pool of assets to be divided.
The Property Pool
The asset pool on the basis of the matters that required determination is as follows:
| PROPERY POOL | VALUE | |
| ASSETS | ||
| 1. | B Street Suburb C | $1,550,000 |
| 2. | Workshop 1, G Street Suburb C | $455,000 |
| 3. | Workshop 2, G Street Suburb C | $440,000 |
| 4. | Workshop 3, G Street Suburb C | $315,000 |
| 5. 56. | Burke Company Pty Ltd | |
| · Cash at Bank as recorded by Mr M 30.06.2019 | $355,908 | |
| · Interest on Term Deposit $284,063 @1.5% since 30.06.2019 | $4,261 | |
| · Plant & Equipment as valued by Mr P | $240,750 | |
| Total of business | E$600,919 | |
Total: | E$3,360,919 | |
Other Items | ||
6. | Chattels, plant and equipment to be retained by the wife | $114,550 |
7. | S Limited Shares | E$16,000 |
8. | Classic vehicles still owned by the husband – Registered motor vehicle 7, Registered motor vehicle 9 and unregistered red motor vehicle 10 | E$90,000 |
Total: | $220,550 | |
TOTAL ASSETS | $3,581,469 | |
LIABILITIES | ||
9. | Capital Gains Tax on the sale of Workshop 1 and 2. | E$128,689 |
Total: | E$128,689 | |
| TOTAL NET ASSETS EXCLUDING SUPERANNUATION | E$3,452,780 | |
SUPERANNUATION | ||
10. | Wife Superannuation (BB Super Fund) | $51,853 |
11. | Wife Superannuation (CC Super Fund) | $12,853 |
12. | Husband Superannuation (DD Super Fund) | $61,235 |
Total: | $125,941 | |
| TOTAL NET ASSETS INCLUDING SUPERANNUATION | E$3,578,721 | |
OTHER ASSETS | ||
13. | Husband’s Interest in J Street property (DD Super Fund) | $162,000 |
Contributions
Initial Contributions
The wife’s evidence is that she did not have assets of any significance when she commenced her relationship with the husband. Although she acknowledges that at the commencement of cohabitation the husband owned the unencumbered F Town Property in which he was living, it is her evidence that she made contributions to the property after moving in including removing carpet, sanding floors and sealing floorboards, painting the house and staining the deck. I am not satisfied that the wife’s contributions were as great as she said or that even if they had been they added to the value, if at all, or were a significant contribution in the context of the initial contribution made by the husband. Particularly so in circumstances where the wife also had the benefit of living in the property. Although the husband did not adduce any evidence as to the value of the property at the commencement of the relationship it is not in dispute that the property was sold in 1999 for $120,000.
The husband deposes that he also owned the vacant land at H Street, Suburb C, a gift from his father, albeit he acknowledged that the property was not registered in his name until 1999. Although the wife in her evidence asserted that the property was a gift to them both she did not adduce any evidence in support of that assertion and it is in my view not consistent with the property being registered in the husband’s sole name. In my view in circumstances where the property was a gift from the husband’s father it does not make a significant difference whether the husband had been gifted the property prior to the commencement of cohabitation in 1995 or in 1999 when it was transferred to his name. As submitted by the wife there is no evidence as to the value of H Street when the husband asserts it was gifted to him by his father.
Although the husband’s case is that he also had savings of approximately $125,000 which were used together with the proceeds of sale of D Street to pay for the construction at H Street he did not produce any bank records or any other evidence in support of his savings either at the commencement of cohabitation or when the house was built. The wife disputes that the husband had savings of that amount at the commencement of cohabitation producing bank records which demonstrated relatively small savings and highlighting the fact that it was four years after the commencement of cohabitation that they built their new home and that the husband had continued to work during that period whilst she cared for their first child. Weighing up all of the evidence I am satisfied on the balance of probabilities that the husband had some savings and albeit it is not possible to put an exact figure on the amount that those savings were applied to the cost of the construction of their new home at H Street.
It appears to be common ground that the parties thereafter purchased the adjoining block and after making improvements to both properties sold them both and applied the proceeds of sale to the purchase of the B Street property. Having sold the two H Street properties the parties were able to purchase B Street without a mortgage. The husband’s case is that the assets he had at cohabitation added significantly to the assets which constitute the asset pool for the purposes of these proceedings. There is some force in this submission.
In Pierce v Pierce (1999) FLC 92-844 (“Pierce”) the Full Court said (at [28]) with respect to the husband’s initial contributions as follows:
…In our opinion it is not so much a matter of erosion of contribution but a question of what weight is to be attached, in all the circumstances, to the initial contribution. It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and the wife. In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use made by the parties of that contribution. In the present case that use was a substantial contribution to the purchase price of the matrimonial home.
Although accepting that the husband’s initial contributions must be weighed up against all of the parties other contributions as in Pierce the husband’s initial contributions were used for a home and although that home has now been sold the proceeds were used to acquire what is now the parties’ most valuable asset without having to borrow to do so. In my view it is also reasonable to infer that the fact that the parties did not have to borrow extensively for the purposes of acquiring the B Street property or meet ongoing mortgage payments would have enhanced their capacity to accumulate further assets and improve their financial position.
At the commencement of cohabitation the husband was also operating a business trading as Burke Company which he had owned and operated for some 10 years prior to commencing a relationship with the wife. It is this business which was the foundation of Burke Company Pty Ltd which he has operated throughout the relationship, continues to operate and which is included in the asset pool.
Contributions during the Relationship
Although the husband deposed to his greater income he and the wife both put their cases on the basis of their contributions during their relationship being equal. To the extent that the parties’ contributions over 22 years may diminish the weight of the husband’s initial contributions they do not in my view diminish them such that as the wife submits those initial contributions should be given no weight. In all of the circumstances I am satisfied that based upon all of the parties contributions there should be as submitted by the husband an adjustment of 5% of the asset pool, excluding the Suburb C property, to which neither party has directly contributed, a figure of $172,639.
The asset pool excluding the J Street property and the parties’ superannuation entitlements, which are of similar value, is approximately $3,452,780. On the basis of my findings of a 55/45 split in favour of the husband, the parties entitlements based upon their contributions are approximately $1,899,029/1,553,751. On this basis the difference between their respective entitlements is approximately $345,278.
Other Considerations: Section 75(2)
The husband is nearly 57 years of age. In 2017 he was diagnosed with severe dilated cardio-myopathy and in 2018 had a pacemaker inserted. Although the husband did not adduce any medical evidence which would suggest that he cannot work the business the husband has operated for most of his adult life is to be wound up and it is his evidence that apart from restoring and selling vehicles he does not otherwise propose to work.
Although counsel for the wife cross-examined the husband about his income earning capacity based upon the income generated by the business the husband, even if he does continue to work, will not be operating his own business and the equipment he requires to do so will have been sold. Whilst the husband may seek and obtain employment I accept as he submits that even if he is able to do so he is unlikely to earn the income he did during the relationship and in any event given his age, health issues and the nature of his work has a more limited work life than the wife.
Both the husband and the wife have a small amount of superannuation. This is a more significant factor in the husband’s case as the wife is younger and will have the opportunity to work for longer and make further provision for her retirement.
Although the husband has a new partner with whom he is presently living I accept his evidence that he wishes to purchase his own home and in my view it is not unreasonable that he should do so.
The wife is 45 and in good health. She has also has a new partner who is approximately 28 years of age and is a qualified tradesperson. Although her new partner has made only a minimal contribution to the wife’s household there is in my view nothing to suggest that he cannot and should not make a more significant contribution. The wife proposes to retain the B Street property which is set up for the operation of a sport activity business and she proposes to operate that sport activity business as well as an additional casual job.
It is the husband’s case that for some months following separation the wife had the benefit of the rental income from the Suburb C workshops and that she withdrew $127,000 from their personal account. As previously referred to the wife says she used some of that $127,000 to pay her legal fees. Although the wife says that she had until separation received an income and following separation needed the funds for her support as submitted by the husband the wife did manage the administrative side of the business and I am satisfied could have sought employment in that field. There is no evidence that she attempted to do so. Whilst the wife’s case is that she was responsible for her elderly mother’s care this is not a legal obligation nor is she entitled on that basis to rely upon what are in effect joint funds for her support without there being some accounting for those funds. Although it is a matter for the wife what contribution she requires either her partner or the children of the marriage to make to the household expenses it is not open to her to then not account for the funds she has had access to in circumstances where she has made the decision to in effect subsidise the living expenses of other members of her household. The wife herself has also had the benefit of occupying the B Street property to the exclusion of the husband, save and except that he has had access to the property in order to operate his business, whereas the husband has had to pay for accommodation elsewhere. In this case by way of a contribution to the expenses of his new partner’s home.
The husband for his part has also had the benefit of the rental income from the Suburb C workshops and although the evidence does not allow me to determine an exact figure I am satisfied that even after payment of expenses it is likely to have been significant. The husband has also had the benefit of the $120,000 he received from the sale of the vehicles. I am satisfied that he has used some of these funds to pay his legal fees. Although it is the husband’s case that he has had health issues and that the business for various reasons has not been as profitable since separation the benefits he has received are not insubstantial and in my view should be taken into account.
Based upon my findings with respect to the parties respective contributions the husband is entitled to $345,278 more than the wife.
Finally although the husband’s 33 % interest in the Suburb C property is subject to his father’s life interest he will upon his father’s death have the benefit of his interest in that property.
The husband’s case was that in addition to the 5% for his greater contributions there should be an adjustment of a further 2.5% based upon a weighing up of the s 75(2) considerations. Rather than seeking a specific percentage adjustment counsel for the wife submitted that there should be an adjustment in the wife’s favour to balance out any adjustment in the husband’s favour based upon his contributions. In all of the circumstances having weighed up all of the relevant s75(2) considerations I am satisfied that there should be an adjustment of 3% in the wife’s favour. In real terms this amounts to an additional $103,583. On this basis the assets excluding the husband’s interest in the Suburb C property and the parties’ superannuation entitlements will be divided as to 52/48 in the husband’s favour. On this basis the husband’s entitlements will be approximately $1,795,445 and the wife’s entitlements will be approximately $1,657,334 the difference between their respective entitlements being $138,111. I am satisfied that having regard to all of the circumstances of the case the proposed division of the property available for division is just and equitable.
Effect of the Orders
As previously referred to the husband prepared a detailed minute of orders. The form of the orders is generally not in dispute albeit counsel for the wife highlighted where the parties are apart based upon the husband’s minute of orders. I will on that basis use the husband’s minute of orders subject to the determinations I have made as the foundation for the orders I propose to make. The parties having indicated that they had not received any advice in relation to the most tax effective way dividing their property. I also propose to give the parties the opportunity to make submissions with respect to the form of the orders.
Although the ultimate outcome will depend upon the results of the sale of the workshops, chattels, plant and equipment and any tax consequences of these orders based upon the asset pool as identified and the parties respective entitlements the property the wife wishes to retain is valued at $1,664,550 which based upon her entitlements requires a payment to the husband of approximately $7,216. This figure will ultimately depend upon the amounts received upon the sale of the assets which are to be or have already been sold.
Although the parties have now agreed that the wife should have the opportunity to retain the B Street property it is her case that she should have 90 days after the sale of the two workshops which are to be sold to pay any amount that she is required to pay to the husband. The husband’s case is that the payment should be made within 30 days. In circumstances where it may take some time for the two workshops to be sold and the amount the wife will have to pay, at least in general terms, will upon their sale be relatively clear I am not satisfied that there is any basis for the wife to have 90 days in which to make the payment.
It is also the wife’s case that the three vintage vehicles the husband says should be sold should be included in his entitlements at a figure of $90,000. In my view there is no basis for requiring the husband to retain the vehicles nor should he be required to solely bear the risk of a sale or conversely be entitled to any additional amount if the vehicles were to sell for more that the value attributed to them for the purposes of these proceedings.
It was also the wife’s case that the husband should be liable for any tax she might incur for the rental income he received albeit some of that income was attributable to her for tax purposes. In cross-examination that husband conceded that the wife should not be liable for tax on income she had not received and I propose to make the order the wife seeks.
The wife also sought an order requiring the husband to pay for the separately metered business utilities and half the water bill for the property. Although I am satisfied that the husband should pay for the separately metered utilities until the business ceases operating I am not satisfied that the husband should be required to pay half of the water bill for the property. There is no evidence with respect to how much water the business uses or why half of the bill would be fair.
The orders I propose to make subject to any submissions as to the form of those orders is as follows:
1.That the matrimonial asset pool be divided 52/48 in the husband’s favour.
2.That the total value of the pool shall be calculated as follows:
a.$1,550,000 being the value of the property at B Street, Suburb C (“B Street property”) being the whole of the land more particularly described in Certificate of Title Volume … Folio … unencumbered;
b.$440,000 being the value of Workshop 2 at G Street Suburb C (“Workshop 2”), known as Lot … on Plan of Subdivision … more particularly described in Certificate of title Volume … Folio …;
c.$114,550, being the wife’s retained chattels;
d.The sum referred to in paragraph (7)(b) of these Orders being the net proceeds of sale of the husband’s classic vehicle collection;
e.The sum referred to in paragraph 6 of these Orders, being the net proceeds of sale of Workshop 1 at G Street Suburb C (“Workshop 1”), known as Lot … on Plan of Subdivision … more particularly described in Certificate of title Volume … Folio … and Workshop 3 at G Street Suburb C (“Workshop 3”), known as Lot … on Plan of Subdivision … more particularly described in Certificate of title Volume … Folio …;
f.The sum referred to in paragraph 8(g)(ii)(1) of these Orders, being the net proceeds of sale of the chattels in the husband’s personal name;
g.The sum referred to in paragraph 11 of these Orders, being the proceeds of sale of the stock plant and equipment owned by owned by Burke Company Pty Ltd (“the Company”) or located at B Street other than the wife’s retained chattels as described in the P Valuation; and
h.The sum referred to in paragraph 13(a) being the balance of any remaining assets of the Company after the payment of any taxation liabilities.
Assets to be retained by the parties
3.The husband retain Workshop 2 and as from the date of these orders be solely entitled to receive all rental income from that property.
4.That the wife retain the chattels listed in pages 17 to 14 (inclusive) of Mr P's Valuation dated 16 August 2019 (“the P Report”), (“the wife’s retained chattels”) valued at $114,550.
The B Street property
5.That the B Street property be dealt with as follows:
a.After settlement of the sale of Workshop 1 and Workshop 3 and the realisation of the stock, plant and equipment owned by the Company and/or located at B Street the wife shall have thirty (30) days thereafter to make such payment to the husband as would result in him receiving 52% of the pool having regard for the assets in the pool otherwise being retained by the parties pursuant to these Orders;
b.In the event that the wife is able to make the payment referred to in 5(a) within the relevant timeframe, the husband shall contemporaneously with that payment transfer all of his right, title and interest in the B Street property to the wife;
c.In the event that the wife is unable to make the payment referred to in paragraph 5(a) within the relevant time frame, the husband shall have 7 days in which to give written notice to the wife of his intention to make a payment to the wife and to retain the B Street property (“the notice”);
d.The husband shall thereafter have thirty (30) days from the giving of the notice to make such payment to the wife as would result in her receiving 48% of the pool having regard to the assets in the pool otherwise being retained by the parties pursuant to these Orders;
e.In the event that the husband is able to make the payment referred to in paragraph 5(d) within the relevant timeframe, the wife shall contemporaneously with that payment transfer all of her right, title and interest in the B Street property to the husband and shall vacate the B Street property;
f.In the event that the husband is unable to make the payment referred to in paragraph 5(d) within the relevant timeframe, the parties shall then do all acts and things necessary to forthwith sell the B Street property on such terms and conditions as may be agreed and failing agreement as set out in paragraph 14 of these orders.
g.Pending any transfer or sale of the B Street property
i. The husband shall continue to be at liberty to attend the B Street property within the confines of the Intervention Order made in the Magistrates court proceeding number … pending the full implementation of these Orders;
ii. The wife shall otherwise have sole use and occupation of the B Street property and shall be liable for all rates, taxes and outgoings for that property save and except that until the business ceases operating the husband shall be liable for the separately metered utilities used by the business;
iii. The parties hold their respective interests in the B Street property upon trust pursuant to these Orders; and
iv. Neither party further encumber the B Street property without the consent in writing of the other party save and except with respect to the wife making payment to the husband pursuant to paragraph 5(a) hereof.
Proceeds of Sale of Workshop 1 and Workshop 3
6.That upon settlement of the sale of Workshop 1 and Workshop 3 or if already sold the net proceeds of sale held trust on trust for the parties pursuant to the Orders made 1 July 2020 be forthwith paid to the husband.
Sale of chattels and winding up of Burke Company
7.That within sixty (60) days of the date of these Orders the following be put up for sale at auction on the following terms and conditions (“the auction”):
a.All assets of Burke Company Pty Ltd ACN … (“the company”) and the stock, plant and equipment as described in the P Valuation save for the wife’s retained chattels; and
b.The motor vehicle 7 Registration …, the motor vehicle 9 … and the unregistered red motor vehicle 10.
8.That for the purpose of the auction referred to in paragraph 7 of these Orders the following shall apply:
a.The wife shall nominate three (3) suitably qualified auctioneers and shall forward those nominations, together with details of their fees and commissions, to the husband, within 14 days of this order (“nomination”). Within seven (7) days thereafter the husband select one (1) of the nominated auctioneers.
b.The auction be held onsite at the B Street property, and marketed to the public for a period of time directed by the auctioneer;
c.The auctioneer be provided with the schedule of assets as annexed to the P Report, excluding those items to be retained by the wife, and pursuant to this order shall list all items as per the schedule for sale in the auction;
d.Where items in the P Report are grouped, the auctioneer has discretion to retain existing groupings, or further itemise items in order to facilitate the highest total sale prospects;
e.The husband and/or his agent be permitted to attend at the auction notwithstanding any Intervention Order made in the Magistrate’s Court as to his presence at the B Street property, and each be permitted to bid at the auction on any item for sale;
f.Should any items listed in the Schedule referred to in sub paragraph (c) hereof not be available or produced at the auction, then that item be attributed as having been retained by the parties who is listed in the Schedule as having possession of such item and at the value in such Schedule as identified in the P Report;
g.The sale proceeds of the auction be applied as follows:
i. Firstly to all costs, commissions and expenses of the auction;
ii. The net sale proceeds be paid as follows:
1. In relation to any assets not the property of the Company to the husband directly;
2. In relation to any assets owned by the Company into an account in the name of the company.
9.That upon completion of the auction referred to in paragraph 7 of these Orders, the parties do all such acts and things and sign all such documents as may be required to wind up the company at the company’s expense, including but not limited to the sale of the S Limited shares.
10.That for the purpose of paragraph 9 of these Orders the parties shall engage Mr Z, Forensic Accountant, at the company’s expense to ascertain any tax payable on the distribution of assets owned by the company to the husband, whether in the name of the company or the husband personally, with such estimated amount thereafter to be paid to the Australian Taxation Office.
11.That the balance of any company assets remaining, after the payment of any taxation liabilities pursuant to paragraph 10 of these Orders, be distributed or paid to the husband.
12.That pending the winding up of the company:
a.The parties be and are hereby restrained from depleting the CBA term deposit account number ending in …05; and
b.The husband be and is hereby restrained from disposing of or otherwise dealing with any assets of the company save in the ordinary course of business.
Capital Gains Tax
13.That with respect to any amounts quarantined pursuant to Order 3(b) made on 1 July 2020 to pay capital gains tax on the sale of any asset:
a.In the event that the capital gains tax ultimately payable is less than the sum quarantined the parties shall divide the surplus to effect a division of 52% in favour of the husband and 48% in favour of the wife.
b.In the event that the capital gains tax ultimately payable is more than the sum quarantined the parties shall be liable for the additional sum in equal shares.
14.That the ultimate determination as to whether there is a surplus owed to, or a deficit owed by, the parties with respect to the Capital Gains Tax pursuant to paragraph 13 of these Orders shall not be used by either party as a bar to the otherwise full implementation of these Orders.
If a sale of the B Street property is required
15.That in the event that a sale of the B Street property is required pursuant to paragraph 5(f) of these Orders the following terms and conditions shall apply unless otherwise agreed between the parties in writing:
a.The reserve price be $1,550,000;
b.The wife shall nominate three (3) suitably qualified selling agents and shall forward those nominations, together with details of their fees and commissions, to the husband, within 14 days of this order (“nomination”). Within seven (7) days of the nominated, the husband select one (1) of the nominated selling agents;
c.The sale proceed by way of auction within 60 days from the date of these Orders;
d.Each if the parties be at liberty to bid at the auction of the B Street property, and to the extent necessary the husband and/or his agent is permitted to attend at the B Street property for the purposes of the auction pursuant to these Orders notwithstanding any provision in any Intervention Order made in the Magistrate’s Court that would otherwise preclude him from doing so;
e.Settlement on the sale be 90 or 120 days;
f.The wife shall nominate three (3) suitably qualified conveyancers and shall forward those nominations, together with details of their fees and commissions of each nomination, to the husband, within 14 days of this order (“nomination”). Within seven (7) days of the nominated, the husband select one (1) of the nominated conveyancers;
g.The wife be solely responsible for ensuring that the house at B Street is presented in a clean manner and undertake any such presentation work as required by the selling agent and co-operate with all requests of the selling agent as to inspections and enquiries on the sale;
h.Both parties sign any documents that may be required to implement the sale (including any Sales Authority or Contract of Sale) and do all such acts and things as may be required to effect settlement on the sale including vacant possession;
i.In the event that either party refuses to comply with order 15(h) herein, pursuant to section 106A of the Family Law Act 1975 (Cth), the Registrar be appointed to execute any deed or instrument in the name of the wife or husband and do all acts and things necessary to give validity to the operation of any deed or instrument required to sell the property at B Street, Suburb C, being the whole of the land more particularly described in Certificate of Title Volume … Folio ….
j.The wife be solely responsible for ensuring at her expense that the house and land save for the Workshop at the B Street property is compliant with the Contract of Sale for the purposes of implementing settlement of the sale;
k.The husband be solely responsible for ensuring at his expense that the workshop is compliant with the Contract of Sale for the purposes of implementing settlement of the sale;
l.The proceeds of sale be applied as follows
i. Firstly to all costs, commissions and expenses of the sale;
ii. Thereafter:
1. Such amount to the husband as would result in him receiving 52% of the pool (adjusted accordingly for the net sale proceeds of the B Street property); and
2. Such amount to the wife as would result in her receiving 48% of the pool (adjusted accordingly for the net sale proceeds of the B Street property).
16.That the husband indemnify the wife and keep her indemnified in relation to any taxation paid or payable by her for rental received by the husband from the tenant of Workshop 3 for the period 1 April 2017 onwards.
Ancillary Orders
17.That the wife retain to the exclusion of the husband the following:
a.Funds in any bank accounts in her name or control; and
b.Her superannuation entitlements.
18.That the husband retain to the exclusion of the wife the following:
a.Funds in any bank accounts in his name or control; and
b.His superannuation entitlements.
19.That unless otherwise specified in these Orders and except for the purposes of enforcing the payment of any money due under these Orders:
a.Each party otherwise be solely entitled to the exclusion of the order to all other property (including choses-in-action) in the possession of such party as at the date of these Orders;
b.Each party shall be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders;
c.Money standing to the credit of either party in any bank, building society or investment account shall be the sole property of the owner named thereunder;
d.All insurance policies shall be the sole property of the owner named thereunder;
e.Each party shall be solely liable for and indemnify the other in respect of their individual debts; and
f.Any joint tenancy of the parties in any property real or personal is hereby severed.
I certify that the preceding eighty-one (81) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered on 15 January 2021
Associate:
Date: 15 January 2021
Key Legal Topics
Areas of Law
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Family Law
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Property Law
Legal Concepts
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Negligence
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