C & C

[2006] FamCA 804

FAMILY LAW ACT 1975

FAMILY COURT OF AUSTRALIA

AT MELBOURNE
  APPEAL NO. SA2 of 2006
  FILE NO. MLM 1394 of 2004

IN THE MATTER OF:

C (Appellant)

and

C (Respondent)

JUDGMENT DELIVERED BY
THE HONOURABLE JUSTICE GUEST

Date of Hearing: 3 March 2006
Date of Judgment: 30 June 2006

Appearances:

Ms Smallwood of counsel, instructed by Messrs Pearsons, Solicitors, DX 436 MELBOURNE on behalf of the Appellant (husband)

Mr Spicer of counsel, instructed by Messrs Graeme Freeman, Solicitors, DX 38238 FLAGSTAFF, on behalf of the Respondent (wife)

APPEAL SUMMARY

MATTER: C and C

APPEAL NUMBER: SA 2 of 2006
(MLM 1394 of 2004)

CORAM: Guest J

DATE OF HEARING: 3 March 2006
DATE OF JUDGMENT: 30 June 2006

CATCHWORDS:                FAMILY LAW – APPEAL from FEDERAL
  MAGISTRATE – PROPERTY SETTLEMENT –
  Appeal brought by husband against orders
  dividing the overall property of the parties
  52.5 percent in favour of the husband and 47.5
  percent in favour of the wife - add-back of post-
  separation savings to the asset pool – order made
  by Federal Magistrate failed to recognise husband’s
  overwhelming contributions to former matrimonial
  home – re-exercise of discretion.

Caselaw cited:
De Winter v De Winter (1979) FLC 90-605 at 78,092
Mallet v Mallet (1984) 156 CLR 605 at 608-9
Norbis v Norbis (1986) 161 CLR 513, 539-40
Pierce v Pierce (1999) FLC 92-844, 85,880
House v The King (1936) 55 CLR 499, 504
Rogers v Rogers (1980) FLC 90-874
Chorn v Hopkins (2004) FLC 93-204, 56-58
Kennan v Kennan (1997) FLC 92-757, 84,303

Legislation cited:
ss 75(2), 79(4) Family Law Act 1975

Appeal allowed.

Costs Certificate granted.

INTRODUCTION

This is an appeal by V (“the husband”) against orders made by Federal Magistrates Phipps on 16 December 2005 in contested property proceedings between him and D (“the wife”). His Honour’s orders provide for a division of the overall property of the parties as to 52.5% in favour of the husband and 47.5% in favour of the wife. The overall percentage award in favour of the husband was based upon an assessment of his contributions pursuant to s 79(4)(a)(b) and (c) of the Family Law Act 1975 (“the Act”) at 57.5% with an adjustment of 5% in favour of the wife on account of the prospective adjustments made pursuant to s 75(2) of that Act.

BACKGROUND

The husband was 37 years of age at the time of trial. He is a builder by occupation. The wife was then 34 years of age. She is a computer clerk. The parties first met in 1989 when they were both living with their respective parents. It was asserted by the husband that cohabitation commenced upon their marriage on 13 June 1993. The wife claimed however that they commenced living together approximately six months after they first met.
In the result, his Honour found that cohabitation in fact commenced in mid 1991 and following unhappy differences the parties separated under the one roof in September 2003. There was no complaint at the hearing of the appeal regarding his Honour’s findings as to the length of cohabitation between the parties which totalled nearly 13 years. The husband vacated the former matrimonial home on 19 March 2004 as a result of an Intervention Order obtained by the wife. There were no children born of their union.
By reason of his family’s benevolence, the husband became the registered proprietor of the land (upon which the matrimonial home was later constructed) in March 1989. The purchase price of the land was $46,000 plus $2,000 for stamp duty and legal fees which were paid by his parents. A Building Permit for construction of the home was issued on 6 August 1992. Building commenced later that year and, save for installation of some appliances, was finished in time for the parties’ wedding.
In order to build their home, the parties borrowed $80,000 by way of first mortgage and subsequently, on 1 September 1993 a further $24,000 was advanced by the husband’s parents interest free to the parties and payable on demand. Subsequently, the first mortgage was increased by $30,000. At the time of the hearing before his Honour, the mortgage balance was $85,000 and the former matrimonial home had an agreed value of $350,000.
As I said, the husband was a builder by trade and on 4 December 1992 incorporated V PTY LTD, of which both he and the wife were directors. Both parties worked throughout their union and a matter of substantial contest before his Honour concerned the level of the husband’s income which, it was asserted by the wife, was far greater than disclosed by him.

THE JUDGMENT

In the reasons for judgment, his Honour dealt with matters of background, issues for determination and matters he documented under the heading of, “History”. In addition to those matters to which I have thus far referred, his Honour found that the wife maintained the books for the husband’s building business, “for at least a time”, in 1991 and it appears common ground resulting from argument before me that the wife attended to this task throughout the marriage.
His Honour found that the wife worked throughout the union of the parties and was in receipt of a “fairly modest income”, being some $28,000 at the time of hearing. He found, and properly so upon the evidence before him, that the husband’s income was a “matter of controversy” in that the husband asserted his annual income was about $25,000 at the time of the hearing.
His Honour further found (par 22) that the husband’s income throughout the marriage “may have been higher” than disclosed or known to the wife. However, his Honour does not find as a specific matter for determination the level of the husband’s income during the marriage, save to assert that it “may” have been more than actually disclosed by him. Notwithstanding this, and significantly, his Honour found that in terms of their income, the financial contribution of both the husband and the wife was equal throughout the marriage.
His Honour dealt with a specific issue which was the subject of considerable argument before me on appeal, and headed:
“The husband’s income and assets, including whether an amount of $15,000 in a bank deposit account and some or all of his legal costs should be included in the property pool”.
When dealing with this topic, his Honour recorded that the husband’s Financial Statement filed in May 2005 included a bank account in his name with a credit balance of $15,000. However, there was no reference to a bank account in his Form 13 Financial Statement filed in April 2004. The husband’s evidence was that he had accumulated those savings in the 12 months prior to trial. In addition, his Honour found on the husband’s evidence that he paid $10,000 in legal fees during that same period, and a total of $25,000 in legal fees commencing “at some point prior to the 12 months”. He noted that the husband filed his application on 26 February 2004.
In the course of the judgment, his Honour recorded the husband’s stated income and commitments as disclosed in his financial statement and affidavit, concluding that it left the husband “no leeway for saving any substantial amount of money” for legal fees and in respect of which the husband was unable to provide a satisfactory explanation as to the source of such funds. His Honour recorded that for the wife, it was submitted the relevance went to the issue of the husband’s credit, justifying a finding that his income was greater than stated by him. His Honour found favour in that submission and went on to find that the explanation was not necessarily that his income was higher, but that the husband had been assisted by his parents in the past and “may have received money” from his family. His Honour found:
“… Whatever the explanation, has (sic) ability to save $15,000 in 12 months, pay $10,000 in legal costs over the same period, and $25,000 over a slightly longer period, plus pay his living expenses shows income or a combination of income and means greater than his disclosed $490 per week plus benefits”.
His Honour found that in those circumstances, he was justified in drawing an adverse inference and finding that at least some of the $15,000 savings and some of the $25,000 paid for legal fees were “accumulated during the marriage” and that in the circumstances, the husband had a higher income than disclosed (par 33). That finding, appears to contradict the findings of his Honour to which I have referred namely, that the husband had ability to save “$15,000 in 12 months, (and) pay $10,000 in legal costs over the same period”.
In the result, and which was an issue before me on appeal, his Honour found:
“… Some of these amounts are to be included as part of the matrimonial property for the purpose of s. 79. The evidence does not permit pay (sic) precise finding. I find that an amount of $25,000 for savings and legal fees should be included as matrimonial property and treated as having already been paid to the husband”.
There were a number of further findings made by his Honour which were not the subject of contention on appeal. In summary they included the following:
1.The wife spent several weeks travelling in Europe during the marriage and that the husband joined her for some of that time. Further, that each year the husband had trips to Bermagui for game fishing.
2.It was agreed each party’s motor vehicle would not be taken into account and that in relation to furniture and chattels, his Honour concluded that each party had received an equal distribution.
3.His Honour’s finding that the husband’s assertion he had $40,000 in savings at the time of the marriage was so unsatisfactory that it could not be relied upon.
4.Payment for the construction of the concrete slab for the former matrimonial home was sourced from the housing loan and not from the husband’s monies.
5.His Honour’s finding that the husband, “to an extent assisted by his father and his brothers”, did the work of building the house except where specialist trades were required. The work undertaken by the husband included substantial tiling. His brother installed the kitchen cupboards. His Honour further found that the husband, by reason of the fact he was in the building industry, obtained discounts or very good prices on materials.
6.His Honour’s finding that the wife’s family did “some work”, in that her father helped “with the trenches for the concrete slab” and did some painting. Her mother did some sanding of woodwork and walls.
7.His Honour’s finding that as to the construction of the matrimonial home, it was clear that the “… majority of the work was done by the husband’.
8.The wife drew down $17,300 from the mortgage following separation which was used for legal expenses and also drew down $2,000 from joint savings to meet her own expenses. In the result, his Honour found that these amounts (totalling $19,300) should be added back into the pool of assets as part of the wife’s share of the property.
9.As to the loan from the husband’s parents to the parties in the sum of $24,000, it appears that his Honour accepted the submission of counsel for the husband that this sum should be treated as a contribution by the husband and that the property orders should include an order that he indemnify the wife in respect of that loan.
His Honour then addressed his application of the law, from which there was no complaint. He found the matrimonial property of the parties as follows:
·Former matrimonial home –    value        $350,000
mortgage $85,000
$265,000
·Money drawn by wife  19,300
·Husband’s savings and legal costs  $25,000
Subtotal  $309,300
·Wife’s superannuation  20,741
·Husband’s superannuation  1,113
TOTAL  $331,154
The findings of his Honour as to contribution pursuant to s 79(4)(a), (b), and (c) of the Act were as follows:
“44.The husband made an initial contribution of the land purchased in 1989 for $46,000 plus $2,000 being expenses. He’d made a substantial non-financial contribution through his work in constructing the house. His father and brothers helped with the house. He then made a $24,000 contribution through a loan from his parents in 1993.
45.The wife was working throughout the marriage. No evidence was called about when each party’s superannuation was contributed, but most of the wife’s superannuation must have accumulated during the relationship. The wife’s superannuation of $20,741 is not much less than the aggregate of the husband’s superannuation and the loan from his parents, a total of $25,113.
46.The wife assisted the husband’s business with bookkeeping and typing of quotations. Apart from the husband’s initial contribution and loan from his parents, and the wife’s greater superannuation, their financial contributions to the matrimonial home are equal. Their income went to paying the mortgage and their ordinary expenses. The wife organised an elaborate wedding. The husband’s parents paid a higher share of the cost of the wedding.
47.The wife’s mother lived with the parties for a time after her husband died. She made some contribution to the household expenses, but certainly lived at considerably less expense than she would have elsewhere. The wife’s brother lived with the parties for a time and paid $50 per week board. The husband did some work in repairing and improving the wife’s mother’s home. These are matters to be taken into account as contributions, although they are of less significance than other contributions.
48.The wife’s non-financial contribution was some assistance by her and her family with the construction of the house. She undertook normal homemaker duties of cooking, cleaning and laundry. She has not had children. She participated in the IVF program for a period without success. She found that a difficult time. It is something to be taken into account under s.79(4)(c).
49.Cohabitation lasted for nearly 13 years, mid-1991 until, after a short period of separation under one roof March 2004. The husband made an initial financial contribution and then another contribution about two years into the relationship, plus a substantial non-financial contribution immediately prior to the marriage but during the relationship. The husband’s initial contributions must be weighed with all the other relevant contributions by both parties. Regard must be had to the use made of those contributions, in this case, the matrimonial home (Pierce v Pierce (1999) FLC 92-844).
50.The husband, prior to and in the early years, made a substantially greater contribution to the acquisition and improvement of the matrimonial home. That has to be weighed with his other contributions and the wife’s contributions. The period of time has reduced the effect of the husband’s contributions but not completely. I find that the contributions are 57.5% by the husband and 42.5% by the wife”.
As to the question of prospective adjustments pursuant to s 75(2) of the Act, his Honour found that both parties were of similar age and in good health. Their needs were similar and neither had the care of any children. He found that the wife’s level of income earning ability was $28,000 per annum as a computer clerk. Her assets were her share of the matrimonial property. He found that the husband’s means, or income or a combination of both were greater than he had disclosed and accordingly, greater than that of the wife. Otherwise, his assets comprised his share of the matrimonial property.
Accordingly, given the husband’s “greater means or income or both”, his Honour found that there should be an adjustment of 5% in favour of the wife.
As a result of his overall assessment, the distribution of assets in favour of the husband was 52.5% which, taking into account the savings and legal costs already retained by him and superannuation, his share otherwise of the total asset pool was $147,742.85. On the other hand, given the wife’s share at 47.5% of the matrimonial pool and having regard to the monies drawn down by her and her superannuation, her share of the matrimonial pool otherwise amounted to $117,257.15.
His Honour next dealt with the fact that each party sought the opportunity to retain the former matrimonial home by payment out of a lump sum to the other. It was submitted on behalf of the husband that the determining factors in his favour included the fact that the land was purchased for him by his parents and that he had built the home. For the wife, it was submitted that she continued to reside in the property, that their relationship commenced prior to construction and was a significant part of preparation for their marriage. In the result, his Honour found:
“59.This issue can only be decided as part of the consideration whether the orders proposed are just and equitable. There are no children. Each puts forward sentimental reasons for wanting to retain the home. Neither has a greater claim than the other. In the absence of agreement, the only solution is for an order for the sale of the home where each party will have the opportunity to purchase”.
His Honour next turned his attention to the issue of superannuation and having set out the submissions made on behalf of each of the parties, concluded (par 60) that in the circumstances before him, it should be “treated in the same way as the other property and divided in the same proportions”.
His Honour concluded, that in making an order for the sale of the property:
“… the just and equitable way to account for the difference between the amounts already received by each party and their superannuation is to order that the husband be paid a difference between those amounts, $13,928 rather than make a calculation which accounts for the 5% difference in distribution”. (par 61)
This finding generated considerable debate in the appeal hearing before me.

THE APPEAL

The grounds of appeal relied upon by the husband were those constituted under the Notice of Appeal filed 13 January 2006 and were as follows:
“1.The Trial Magistrate did not give sufficient and proper weight to the appellant’s superior financial contribution to the acquisition and development of the asset pool and in particular the matrimonial home. The evidence was:
(a)The appellant made an initial financial contribution by his ownership of an unencumbered vacant block of land on which the home was built.
(b)The appellant’s father advanced $24,000 to the parties for the development of the home.
2.The Trial Magistrate did not give sufficient and proper weight to the superior non-financial contribution to the requisition and development of the asset pool or contribution made on his behalf. The evidence was:
(a)The appellant’s father assisted substantially with the construction of the home.
(b)The appellant’s brother built the kitchen in the home.
(c)The appellant essentially built the home with his own manual labour and application of building skills except where specialist trades were required.
(d)The appellant was able to obtain discounts and financial benefit by virtue of his position in the building trade on the purchase of materials required for the home construction.
3.The Trial Magistrate erred in his consideration of the proper weight to be attributed to the respondent’s contribution and matters properly to be taken into account.
(a)The Trial Magistrate gave too much weight to the respondent’s organisation of the wedding.
(b)The Trial Magistrate gave weight under s.79(4)(c) to the participation in the IVF program on behalf of the wife.
4.The Trial Magistrate failed to give proper weight to the evidence of contributions made by the appellant to the benefit of the respondent’s mother and brother during the course of the marriage.
(a)The respondent’s mother lived with the parties for a significant time.
(b)The respondent’s brother lived with the parties for a significant time.
(c)The appellant performed work in repairing and improving the respondent’s mother’s home.
5.The Trial Magistrate gave excessive weight to the respondent’s assistance with the construction of the house and that of her family, which the weight of the evidence indicated was insignificant.
6.The Trial Magistrate ought to have found on the evidence that the appellant’s contribution to the acquisition of assets greatly exceeded that of the respondent and ought to have found that the appellant’s contribution was 70 percent and that of the respondent 30 percent.
7.The Trial Magistrate erred in finding that the appellant’s contribution was 57.5 percent and that of the wife 42.5 percent, in that the weight of the evidence was contrary to such a finding.
8.The Trial Magistrate erred in his finding by his inclusion in the asset pool to be divided the sum of the appellant’s savings and legal costs of $25,000. The Magistrate ought to have found on the evidence that those funds were representative of monies received by the appellant after separation.
9.The Trial Magistrate erred in his finding that the appellant had means or income greater than he disclosed, in the absence of evidence to that effect.
10.The Trial Magistrate erred in applying a percentage adjustment pursuant to s.75(2) in the context of each party being a similar age and health, in employment and having similar needs.
11.The Trial Magistrate failed to exercise his discretion justly and equitably in ordering the sale of the home in that he failed to give proper weight or consideration to the evidence of the appellant with respect to his wish to retain the property in specie.”

It was firstly argued on behalf of the husband, given the percentage adjustment in his favour, that his Honour’s order was so unreasonable and plainly unjust as to infer that it amounted to a failure on his part to properly exercise the discretion reposed in him pursuant to the provisions of the Act. This involved a consideration of Grounds 1, 2, 4, 5 and 6. Ms Smallwood submitted that his Honour’s conclusion was “so far outside the range” and so “plainly wrong” as to warrant correction on appeal.
In putting her argument, Ms Smallwood emphasised the fact that the principal asset for distribution was the former matrimonial home to which the husband (in summary) made the following direct and indirect financial contributions as found by his Honour:
26.1That the husband was the registered proprietor of the unencumbered land acquired through his family at a total cost of $48,000 (Ground 1 (i) and 1 (iii)).
26.2The husband contributed through his resources an interest free loan of $24,000 sourced from his parents (Ground 1).
(The total of the contributions under sub-paragraphs 1 and 2 hereof amounted to $72,000)
26.3The husband, with some assistance from his father and his brothers “effectively” built the former matrimonial home (Ground 2).
As to the financial contributions by the husband and the wife during the marriage, his Honour found that they each contributed equally to the preservation and improvement of the principal asset (Ground 1.(ii)) and, it may be inferred, to their living expenses.
Ms Smallwood otherwise relied upon additional indirect financial and non-financial contributions evidenced by the wife’s mother living at the former matrimonial home for some time as did the wife’s brother and otherwise work performed by the husband in improving the wife’s mother’s home (Ground 4). In the course of argument she conceded, and properly so in my view, that such contributions were correctly styled by his Honour as being “of less significance than other contributions”.
Ms Smallwood then addressed what she described as “the other side of the coin”, namely the wife’s contributions, relying upon:
29.1the fact that the wife made no financial contributions towards the acquisition of the former matrimonial home; and
29.2the finding by his Honour that the wife’s non-financial contributions were “some assistance by her and her family to the construction” of the former matrimonial home (Ground 5).
Other contributions made or factors relied upon by the wife and considered by his Honour included:
30.1The wife having organised the wedding (Ground 3.(i) and 3.(ii);
30.2The wife’s participation in an IVF program (Ground 3.(iii)); and
30.3The wife having undertaken “normal homemaker duties of cooking, cleaning and laundry” (Ground 6.(ii)), submitting that his Honour provided no indication as to what significance he gave to this contribution overall when making his assessment pursuant to s 79(4)(c) of the Act.
It was further submitted by Ms Smallwood that his Honour erred in his approach to the respective superannuation entitlements of the parties and its translation into the capital sum payable to the husband (Ground 1.(i)) (Judgment par 45, 60 and 61). His Honour appeared to treat superannuation in the same way as other property for division in the percentage ratios determined by him (par 60), but diverted from that approach in his actual calculations.
In the result however, as pointed out by Mr Spicer, his Honour appeared to have made “an ad hoc decision” to distribute the retained assets equally and simply arrived at the figure of $13,968 by deducting the husband’s savings and superannuation (par 56) (a total of $26,113) from the total of the monies drawn down by the wife and her superannuation (par 57) (a total of $40,041). The rationale, it was submitted by Mr Spicer, being because the wife was unable to access her superannuation for many years. Mr Spicer further submitted, that in any event if his Honour were to distribute the assets in the percentage differential found by him (par 60) the difference would have amounted to less than 1% which he, aptly in my view, described as “minuscule”.
Ms Smallwood further submitted that his Honour erred by including in the matrimonial property for division between the parties the sum of $25,000 being the husband’s savings ($15,000) and legal costs ($10,000) (par 43) as it was constituted by monies received by the husband post separation (Ground 8). See Chorn v Hopkins (2004) FLC 93-204 at par 39, 43, 49 and particularly at par 58. Such was evident, she submitted by a comparison of the Form 13 Financial Statements filed by the husband on 19 April 2004 and 27 May 2005 when his Honour found that the husband had the ability to save those monies “in 12 months”. Ms Smallwood submitted that his Honour’s finding (par 33) that “some” of those monies “accumulated during the marriage” was certainly in contradiction to his earlier finding, but which was never, in any event put to the husband in evidence. See transcript 125, 130, 131 (L26) 133 (L15).
As to his Honour’s findings and determination concerning any adjustment pursuant to s 75(2) of the Act (Ground 10, and par 9(i)-(iv) of the Written Submissions), Ms Smallwood submitted that no adjustment should have been made given his Honour’s findings that the parties were of similar age and health and that they were both employed and had similar needs. There was no basis warranting an adjustment of 5% in favour of the wife. Ms Smallwood warned against the process of “social engineering”. See Dixon v Dixon (1999 FLC 92-843 at page 85,871).
Finally, Ms Smallwood submitted that his Honour’s discretion miscarried in ordering a sale of the former matrimonial home (Ground 11) given the findings that the husband effectively built the home and that he owned the land prior to his union with the wife. He was the sole registered proprietor and was, in any event, to receive a larger percentage of the home which would achieve a collateral cost saving in favour of the parties by avoiding the costs associated with sale and potential difficulties arising therefrom. In any event, his Honour erred in causing the monies to be paid to the husband from the gross proceeds of sale when it ought to have been paid, she submitted, from the wife’s share of the property.
It was submitted, that in the result it was his Honour’s intention to provide the husband with 52.5% of all assets held by the parties, extraneous to the real estate as found by him and that the final orders did not achieve that purpose.
I have carefully considered the written outline of argument filed on behalf of the wife and the oral submissions of Mr Spicer, all of which have been extremely helpful to me in coming to my determination. The written outline responded to each of the grounds of appeal relied upon by the husband. It was submitted, for example, the attribution by his Honour of 15% more of the equity in the former matrimonial home was a recognition primarily of the husband’s greater initial contributions (pursuant to s 79(4)(a) and (b) of the Act) and described by his Honour in the course of his judgment as the “substantially greater contribution”.
I have regard to the written submissions on behalf of the wife dealing with the issue of superannuation and to the oral submissions which I have earlier addressed in this judgment. It was otherwise argued on her behalf that the adjustment of percentages was not a “mathematical exercise” and that the court had an obligation to give weight to any relevant factor and generally would do so in a “global” sense. With that submission there can be no dissent.
In considering the grounds of appeal, the submissions on behalf of the wife dwelled principally on the question of “weight” given by his Honour to the various and differing contributions emphasising that he did so appropriately in the exercise of his broad discretion. Counsel was critical with the manner in which the husband conducted the proceedings before his Honour, submitting that the husband overstated his own contributions and understated those of the wife and her family. Those matters were addressed by his Honour, it was argued, in an appropriate manner.
In his oral submissions, Mr Spicer addressed me further on the issue of contribution, concluding that it could be said that the 7.5% advantage in favour of the husband “might be a bit high or low, but was not manifestly wrong” and was within “proper boundaries”.
Insofar as the accumulation of post separation savings is concerned, it was submitted that his Honour made the findings he did because it was not possible for the husband to have saved the amount of $15,000 on his level of income and otherwise that his Honour did not accept the husband’s evidence. In those circumstances, when the husband had an opportunity to present evidence that would clarify the true position but chose not to, it was appropriate that his Honour might not be cautious in drawing inferences adverse to the husband. Thus, it was submitted, his Honour was entitled to draw the conclusion that the husband had a greater earning capacity than that of the wife. This aspect was further supported in oral argument by Mr Spicer before me and clearly went to the husband’s income earning capacity.
Counsel for the wife supported his Honour’s adjustment pursuant to s 75(2) of the Act on the basis of the husband’s greater earning capacity and which his Honour could properly find on the evidence before him. Mr Spicer submitted that the wife had a “limited economic future”.
As to his Honour’s orders concerning the disposition of the former matrimonial home, Mr Spicer correctly pointed out that the wife had not cross appealed the relevant order, and indeed, went on to say that she “supported” it. That submission has assisted me in my approach to my ultimate determination of this appeal. Mr Spicer said his Honour took into account the “reality of the feelings of each (party) held” in relation to the property.

PRINCIPLES ON APPEAL

In relation to the discretionary aspect of the appeal, the principles which govern such an appeal are not in doubt and do not require repeating in the context of this case: See House v The King (1936) 55 CLR 499; Australian Coal and Shale Employees Federation v The Commonwealth (1953) 94 CLR 621 per Kitto J at 627; Gronow v Gronow (1979) 144 CLR 513; Norbis v Norbis (1986) 161 CLR 513 and CDJ v VAJ (No. 1 ) (1998) 197 CLR 172 at 230 per Kirby J.
The discretion vested in a trial judge to make orders altering the interests of parties in property within the framework of s 79 of the Act, and after being satisfied that, in all the circumstances, it is just and equitable to do so, has been described as “… extraordinarily wide” and “… to be exercised with scrupulous care”. See De Winter v De Winter (1979) FLC 90-605 at 78,092 per Gibbs J. In Mallet v Mallet (1984) 156 CLR 605 at 608-9, Gibbs CJ when discussing the very wide discretion conferred on the court had this to say:
“… The Act does not indicate the relative weight that should be given to different circumstances, or how a conflict between opposing considerations should be resolved – those things are left to the court’s discretion, which must, of course, be exercised judicially.
…
… Decisions in particular cases … do no more than provide a guide; they cannot put fetters on the discretionary power which the Parliament has left largely unfettered. It is necessary for the court, in each case, after having regard to the matters which the Act requires it to consider, to do what is just and equitable in all the circumstances of the particular case.”
Any argument based on the ground that the exercise of the discretion by the primary judge is vitiated by his or her failure to give sufficient weight to a relevant factor needs to be viewed with “considerable caution”. See Mason J (as he then was) in Mallet v Mallet (1984) 156 CLR 605 at 621. The breadth of judicial discretion has been explained by Brennan J (as he then was) in Norbis v Norbis (supra) at 539-40 as follows:
“… Unless the primary judge reveals an error in his reasoning, the Full Court can intervene only if the order made is not just and equitable. How does the Full Court arrive at that conclusion? In Bellenden (formerly Satterthwaite) v Satterthwaite (1948) 1 All E.R. 343 at p. 345, Asquith L.J. stated the rationale of an appellate court’s approach:
‘It is, of course, not enough for the wife to establish that this court might, or would, have made a different order. I are here concerned with a judicial discretion, and it is of the essence of such a discretion that on the same evidence two different minds might reach widely different decisions without either being appealable. It is only where the decision exceeds the generous ambit within which reasonable disagreement is possible, and is, in fact, plainly wrong, that an appellate body is entitled to interfere.’
The ‘generous ambit within which reasonable disagreement is possible’ is wide indeed when there are a number of factors to be taken into account and the comparative weight to be attributed to those factors is not clearly indicated by uniform standards and values of the community. The generous ambit of reasonable disagreement marks the area of immunity from appellate interference.”
It is with those clear principles in mind that I come to my determination in this appeal.

CONCLUSION

In coming to my conclusion, I commence by bearing in mind the words of Gibbs J (as he then was) when describing the discretion reposed in the trial Judge as “extraordinarily wide” (De Winter v De Winter (supra) at 78,092) and later, as Chief Justice in Mallet v Mallet (supra) at 609 as “largely unfettered”. The difficulties of the husband in this appeal relying upon “weight grounds” are obvious (see Norbis v Norbis 161 CLR at 540 per Brennan J and Gronow v Gronow (1979) 144 CLR 513 at 519 per Stephen J).
When considering the process of assessment, the dicta of Brennan J in Norbis v Norbis (supra, FLC at p 75,178) felicitously prescribes the limits of my capacity to interfere with the assessment of his Honour in this case, as in others. In that case, after citing a well-known passage from the judgment of Asquith LJ in Bellenden (formerly Satterthwaite) v Satterthwaite (1948) 1 All ER 343 at 345, wherein the learned Lord Justice said that an exercise of discretion may only be judged “plainly wrong” if it “exceeds the generous ambit within which reasonable disagreement is possible”, Brennan J said:
“The ‘generous ambit within which reasonable disagreement is possible’ is wide indeed when there are a number of factors to be taken into account and the comparative weight to be attributed to those factors is not clearly indicated by uniform standards and values of the community. The generous ambit of reasonable disagreement marks the area of immunity from appellate interference.”
When considering whether or not the adjustment made by his Honour of 7.5% of the asset pool in favour of the husband (a 15% differential overall) following his examination of the contribution issues (s 79(4)(a)(b) and (c)) was a just and equitable one in the discrete circumstances of the hearing before him, it is proper to bear in mind that it is not an accounting exercise (Beneke v Beneke (1996) FLC 92-698 at p 83,362), but one that requires a broad approach in ascertaining the parties’ relative contributions whilst remaining firmly focused on achieving an appropriate outcome. That outcome must, as mandated by the Act, be one that is just and equitable within the factual matrix of the proceedings under consideration.
What is dominant and obvious in these proceedings is that the former matrimonial home is the foremost asset of the parties and even accepting his Honour’s assessment of the matrimonial property (and with which I disagree), it represents some 80% of the pool of assets available for distribution. It is common ground that the husband brought into their marriage the land at an overall cost of $48,000 and upon which the former matrimonial home of the parties was constructed. The husband cleared the land and positioned the house on the block. Through his resources he contributed a further $24,000 towards construction costs. The husband, a builder by trade, “to an extent assisted by his father and his brothers” built the house and which work included substantial tiling. By reason of his connections, the husband obtained discounts and very good prices on materials.
The wife made no financial contribution and the contribution of her family was, given his Honour’s findings (par 24) capable of falling under the descriptive term of “marginal”. His Honour acknowledged that the wife helped with the “set out” of the house on the land.
His Honour described the fact that the husband both prior to and in the early years of their union made a “substantially greater” contribution to the acquisition and improvement of the former matrimonial home. Also of significance, in my view, is that each party worked and were found by his Honour to have made equal financial contributions to the meeting of the mortgage payments and their ordinary expenses throughout the marriage.
There were other contributions made by and on behalf of the husband and the wife to which I have referred in this judgment. The wife’s contribution otherwise was as a homemaker, but should be assessed having regard to the fact that she was also in employment and “assisted” the husband’s business with bookkeeping and typing quotations. The impression I gained from this aspect of his Honour’s judgment was that it was not a contribution of sizeable significance for if it were otherwise, one would have expected his Honour to have placed greater emphasis upon it.
It is so plain to see on the discrete facts of these proceedings that there was an overwhelming disparity in terms of the initial contribution to the acquisition of the former matrimonial home, the principal asset, by each of the parties. The husband’s direct and indirect financial contributions together with his direct and indirect non-financial contributions by far exceeded those of the wife. How this ought to be treated is governed by the principles laid down by the Full Court in Pierce v Pierce (1999) FLC 92-844 where Ellis, Baker and O’Ryan JJ has this to say (FLC p 85,880):
“26.In Way and Way (1996) FLC 92-702, the Full Court (Barblett DCJ, Finn and Butler JJ), said at 83,404:-
‘In the subsequent Full Court decision in Bremner all three Judges expressly preferred the approach taken by Fogarty J in Money over that taken by Lindenmayer J in the same case. Thus, and notwithstanding the attempts by Counsel for the husband in this case to demonstrate that there was some inconsistency between what Fogarty J said in Money and what was actually said in the joint judgment of the Full Court in Lee Steere, we regard the law in this area as now settled by the statement by Fogarty J in Money (and subsequently accepted by all members of the Full Court in Bremner) that ‘… an initial contribution by one party may be “eroded” to a greater or lesser extent by the later contributions of the other party even though those later contributions do not necessarily at any particular point outstrip those of the other party’.
27.However, it is important to put that quotation in its correct context. Fogarty J in Money and Money (supra) said at page 81,054:-
‘I am unable to agree with the criticism in his Honour by the passage in his judgment immediately after that quotation or of his analysis of the issues involved. In an appropriate case, in my view, an initial substantial contribution by one party may be ‘eroded’ to a greater or lesser extent by the later contributions of the other party even though those later contributions do not necessarily at any particular point outstrip those of the other party. I feel, if I may say so with respect, that his Honour’s formulation to the contrary is unrealistic and does not correspond with common experience in the Court in many of these cases.
I think it is legitimate for me to say, as I was a member of the Full Court in Lee Steere and Lee Steere … that His Honour has read too much into the passage to which he refers and that the term ‘off-setting contribution’ does not necessarily mean ‘greater contribution’. It simply reflects the circumstance that the respective contributions of the parties over a long period of marriage ‘offset’ the significance which might otherwise be attached to a greater initial contribution by one party. This is, in my view, made clear by the Full Court in White and White (1982) FLC 91-246 where that court pointed out that the principle in Crawford and Crawford (1979) FLC 90-647 is that the original contribution should not be carried forward as a mathematical proportion; ultimately, when it comes to the trial such a contribution is one of a number of factors to be considered. The longer the marriage the more likely it is that there will be later factors of significance and in the ultimate the exercise is to weigh the original contribution with all other, later, factors and those later factors, whether equal or not, may in the circumstances of the individual case reduce the significance of the original contribution’.
28.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 of 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: See also Campo and Campo (unreported, Full Court (Ellis, Lindenmayer and Finn JJ), Sydney, delivered 19 May 1995 at pages 21 and 22 of the joint judgment) and Zahra and Zahra (unreported, Full Court Sydney, delivered 3 October 1996, per Ellis J at page 10).”

As I have made clear, it is beyond argument that the husband’s initial contribution to the former matrimonial home was prodigious. The financial contributions otherwise by the parties to the household were equal. The use that was made of these clear and defined disparate contributions overall was to achieve a home in which the parties lived. That home was registered in the name of the husband. Even allowing for the contributions made by the wife as adumbrated by his Honour and having regard to the duration of their union, the determination made by an adjustment measured at 7.5% of the pool of assets (or 15% overall) is, in my view, so “unreasonable or plainly unjust” as to infer that his Honour failed to properly exercise the discretion which the law reposed in him (House v The King (1936) CLR 499 at 504).
In my view, his Honour’s discretion miscarried. He did not have sufficient regard to s 79(2) of the Act, the purpose of which is to ensure that the court will not alter the property interests of parties unless it is satisfied that cogent considerations of justice require it to do so. The result was plainly unjust when regard is had to the relevant factors required for determination under s 79(4) of the Act. See Rogers v Rogers (1980) FLC 90-874. In my view, the exercise of his Honour’s discretion exceeded the “generous ambit within which reasonable disagreement” was possible and thereby fell outside the area of immunity from appellate interference.
The next matter of substance argued by Ms Smallwood concerned the finding by his Honour bringing in to account as part of the matrimonial property the husband’s savings ($15,000) and legal costs ($10,000) being a total of $25,000 in all (par 43). An analysis of the husband’s two Financial Statements regarding his savings (par 30) reveal in the most recent one a credit balance of $15,000 and which appears to have been the foundation for his Honour’s finding (par 32) that he had saved those monies during the 12 months post separation. His Honour also referred to the husband’s evidence (par 30) that in addition he had paid legal fees in the sum of $10,000 (“in the last 12 months”) together with “a total of $25,00 in legal fees commencing at some point prior to the 12 months”. The parties separated under the one roof in September 2003 and the husband instituted proceedings on 26 February 2004.
It is also plain, given his Honour’s findings arising from cross examination of the husband (par 32), that it was designed to demonstrate that his income was far greater than disclosed by him in his two Financial Statements. There was no effective dissent by counsel from this proposition in argument before me. In the result, his Honour found favour with that proposition which underpinned an important aspect of his determination to make an adjustment to 5% in favour of the wife pursuant to s 75(2) of the Act.
When dealing with the husband’s savings of $15,000 recorded in his Financial Statement filed on 27 May 2005, the husband was cross examined at length on his income and financial commitments bringing into account, by comparative analysis, his earlier Financial Statement. The husband confirmed that he had not borrowed nor been “gifted” any money (T129). He specifically denied that he had savings back in 2003-2004 (T131) and confirmed that he saved the $15,000 and paid “another” $10,000 in legal fees between April 2004 and April 2005 (T133). He said that the $15,000 was on term deposit, but no documents were produced. In the course of his addresses, counsel for the wife submitted to his Honour that the husband still retained the $15,000 (T176) and went on to argue:
“… You have that $15,000. It is property of the parties or either of them as s 79 says. Your Honour has got to accept his version and as implausible as it is, to say that it’s his money and it’s accumulated post separation”.
Underpinning that submission to his Honour was counsel’s argument that the husband could “earn more”, pointing out that the disparity in the respective incomes of the husband and the wife and that the sum of $25,000 (being the savings of $15,000 and legal fees of $10,000) “saved in less than 12 months” required an adjustment pursuant to the provisions of s 75(2) of the Act, “to bring about justice and equity”.
It appears to me that this is what his Honour in fact did when considering the issue of any prospective adjustment pursuant to the provisions of that section. In so doing, his Honour in my view improperly brought back into account the savings of $15,000 as part of the matrimonial assets and again used that fact as a matter of significance in supporting an adjustment of 5% in favour of the wife.
His Honour made a clear finding consistent with the evidence and the submissions put to him (inter alia) that the husband had the ability to save $15,000 and pay $10,000 in 12 months demonstrating that he had “income or a combination of income and means” greater than his disclosed income position (par 32). For example, cross examination of the husband revealed that he paid into his account on each of 3 September 2004 and 13 September 2004 the sum of $3,000 by way of earnings. Such evidence would have supported his Honour’s findings that his income and means were greater than disclosed by him.
Albeit somewhat inelegantly expressed, his Honour appeared to be saying (par 33) that he was justified in drawing an adverse inference and finding that “at least some of the $15,000 savings and some of the $25,000 paid in legal fees accumulated during the marriage” resulted from the fact that he had a higher income than disclosed. By using the phrase, “during the marriage”, his Honour appears to have made a determination in contra distinction to his earlier findings and that which was urged upon him at trial by counsel for the wife. However, that may be explicable by the fact that his Honour added a new factor into the totality of monies, namely the $25,000 “paid for legal fees” (par 30).
The evidence of the husband was that he paid $10,000 and that his legal fees were “closer to $25,000” (T133). His answer in cross examination as to whether he owed any legal costs (T133) was somewhat equivocal in that he was cut off and it was not pursued further. That is the sort of evidence that would support his Honour’s reference to the payment of $25,000 in legal fees “commencing at some point prior to the 12 months” without resiling from the legal fees of $10,000 paid over the 12 months preceding the hearing (32). In his submissions, Mr Sweeney addressed his Honour on the basis that the husband had $25,000 worth of “prepaid legals” (T178).
It is clear that whilst the treatment of funds utilised to pay legal costs ultimately remains a matter for the trial judge, in exercising that discretion regard must be had to the source of such funds. Further, that if funds used to pay legal fees existed at the time of separation and were such that both parties could be seen as having an interest in them, then such funds should be added back as a notional asset of the party who was to have the benefit of them. If the funds used to pay legal fees had been generated by a party after the separation from his or her own endeavours or received in his or her own right, those funds would generally not be added back as a notional asset. See Chorn v Hopkins (supra) per Finn, Kay and May JJ at par 56-58 (inclusive).
In my view, given his findings, his Honour was in error in bringing into account as part of the matrimonial property for distribution the paid legal costs to the extent of $10,000 which were accumulated over the 12 months prior to the hearing. However received, it resulted from post separation activities.
As to the $15,000 savings, it was submitted on behalf of the husband that he had those funds at the time of trial (par 8(x)(a) of the written Submissions). Given the findings of his Honour, such funds were accumulated post separation and to which the wife could not have made a contribution in the circumstances of the case. It appears that his Honour failed to give proper consideration to that fact in his findings on contribution (par 44-50).
Given my findings to this stage and having identified errors by his Honour in the exercise of his discretion it is not necessary for me to consider the remaining grounds of appeal relied upon.
Finally, I make it clear that if these last two identifiable errors of his Honour were the only grounds made out affecting the pool of assets, and accepting his Honour’s percentage determination overall at this stage as to how the available property of the parties should be divided as being correct, the result, arithmetically would not lead to a conclusion that the percentage adjustment fell outside “… the general ambit within which reasonable disagreement” was possible (Brennan J in Norbis (supra) CLR at 540, quoting from Bellenden v Satterthwaite (1948) 1 All ER 345). That is, the result from those errors alone could not be said to lead to an overall result that was plainly wrong or manifestly unjust to the husband. However, when taken in combination with the ground first addressed it is clear to me that the appeal must be allowed. In those circumstances, it is unnecessary for me to consider the further grounds of appeal relied upon.
Having regard to the conclusion I have reached in relation to the challenges to his Honour’s orders, the appeal against the order for a settlement of property will be allowed and the orders set aside.

CONSEQUENCES OF ALLOWING THE APPEAL

Both counsel for the husband and for the wife submitted that in the event of the appeal being allowed, it would, in the circumstances be appropriate for the court to re-exercise its discretion. Having regard to the relatively modest means of the parties, the history of the litigation to date and the cost to the parties of a new trial I consider that it is appropriate to re-exercise the trial Judge’s discretion on the material before me.

RE-EXERCISE OF DISCRETION

In considering this matter, I have a broad discretion to make such orders as I consider appropriate, tempered however by the requirement that such orders must be just and equitable in the circumstances of the case. In undertaking this task I am required to take into account those matters set out in s 79 of the Act. The legislation provides me with a discretionary power to adjust the property interests of the husband and the wife in a manner that will do justice and equity between them. The discretion that I have is an extensive one.
An established line of authority in this court has made it clear that there are three steps that I must undertake in the determination of the property entitlements of each of the husband and the wife.
The first step I am to take is to identify the assets for distribution between the parties. Given what I have already discussed in the course of this judgment, I find that the relevant assets are as follows:
·    Former matrimonial home         Value $350,000
Mortgage $ 85,000
  $265,000
·    Money drawn by wife   19,300
Subtotal  284,300
·    Superannuation – wife  $20,741
Superannuation – husband  1,113
  $21,854
TOTAL  $306,154

Secondly, I am obliged to make an evaluation of the contributions that have been made by the parties including direct and indirect contributions of a financial character and non-financial character and contributions as a home maker within s 79(4)(a) to (c) of the Act, inclusive.
I have earlier in this judgment discussed the issue of the financial contributions made by the husband and the wife to the assets, the principal asset of which is the former matrimonial home. The financial contributions of both a direct and indirect nature together with the non-financial contributions made by the husband and through his resources to the acquisition, construction and improvement to that principal asset may, in my view, be properly described as the “overwhelming” feature of these proceedings. Each of the parties contributed equally to the maintenance of the home and their lifestyle. There were no children born of their union. I take into account the fact that the wife did attend to clerical work associated with the husband’s business and that her family did contribute to the building of the home, but to an extent that was marginal in comparison to those made by the husband and on his behalf. But for the far greater contribution made by the husband through his resources, it is clear that the parties would not have been able to acquire the land and build the former matrimonial home.
Weighing up the initial contributions of the husband with all other relevant contributions made by both the wife and himself, I would attach significant weight to that contribution and assess the respective contributions of the parties within the meaning of paragraphs (a), (b) and (c) of s 79(4) from the date of the marriage to the date of trial, expressed as a percentage of the nett value of their assets (excluding superannuation) as at the date of the hearing, being 70 per cent by the husband and 30 per cent by the wife.
On the issue of superannuation, I am of the view that it should be treated quite differently from my approach to the assets of the parties as set out in par 78 hereof. Each party worked during the course of the marriage and contributed equally to the household expenses. The wife otherwise established through her own resources a modest superannuation fund and it was not suggested that in so doing, she reduced her financial contributions to the conduct of the domestic household itself. The husband has a minimal superannuation fund. The wife was 34 years of age and, as his Honour said, it will be many years before she can access her entitlements. In my view, having regard to the overall circumstances of the parties and in the exercise of my discretion it would be appropriate to exclude the superannuation component from the asset pool for distribution. Each party shall retain their entitlements as stated.
Furthermore, I do not see it as appropriate, in the exercise of my discretion and for the reasons earlier stated, to include in the list of assets the husband’s savings post separation nor his payment on account of costs in the sum of $10,000. However, I shall deal with this particular aspect further in the course of my judgment when addressing any prospective adjustments pursuant to s 75(2) of the Act.

OTHER FACTORS

As at the date of the hearing, the husband was 37 and the wife was 34 years of age. Both parties are in good health. The husband is a builder by occupation and has the capacity to command a substantially greater income than the wife who is unqualified and unskilled.
In his judgment, his Honour found that the husband had a higher income than disclosed and that his needs and/or income or a combination of them were greater than he revealed and certainly greater than that of the wife. It is clear that the cross examination by the wife’s counsel at trial and his submissions were directed to establishing that fact. This was relied upon by him in seeking an adjustment pursuant to s 75(2) of the Act. It clearly is open for me to conclude that the husband’s income and/or means were far greater than disclosed, for indeed, during the 12 months period following separation he was able to accumulate $15,000 in savings, contribute $10,000 towards his legal costs as well as meeting all usual domestic and daily expenses. It is clear from a reading of the transcript that the husband failed to provide a number of relevant and important documents when requested to do so and failed, as his Honour found, to provide a “satisfactory explanation”. It is in those circumstances that it is appropriate I should not be unduly cautious in making these findings. See Chang v Su (2002) FLC 93-119 and the various authorities there cited.
I find the issue of comparative income and income earning capacity to be a most weighty factor when considering the provisions of s 75(2) of the Act. As Fogarty J in Waters v Jurek (1995) FLC 92-635:
“In the majority of property cases little difficulty is encountered in the contribution step and increasingly in the general run of cases the conclusion is likely to be one of equality or thereabouts. There is no doubt that the centre of gravity in the determination of property cases has, especially in more recent times, moved to the evaluation of the s. 75(2) factors, and the significance of that has been heightened because of recent Full Court decisions which have emphasised those provisions and indicated that they should be given real rather than token weight.”
When considering the various paragraphs of s 75(2) I must be satisfied that the particular paragraphs are relevant in arriving at a just and equitable result. That is a subjective exercise on my part.
The disparity in income and income earning capacity between the husband and the wife is highly significant in my consideration of whether or not there should be any prospective adjustments. It is a striking feature within the factual matrix of this aspect of the proceedings. Furthermore, I find that the orders I propose to make will not in any event have an effect upon the earning capacity of either party.
In my view, having regard to these matters there should be an adjustment to the contribution based entitlement of the wife and that it should be 10 per cent of the net value of the assets (excluding superannuation) of the parties at the date of the hearing. In coming to my determination I am conscious that I must safeguard against utilising the provisions of s 75(2) as a source of “… social engineering or as a means of evening up the financial positions of the parties to the marriage” see Kennan v Kennan (1997) FLC 92-757 at p 84,303, nor to “… equalise the financial strengths of the parties” per Wilson J in Mallet v Mallet (supra) at 638.

PROPOSED ORDERS

I propose to order that the husband be given the opportunity to pay to the wife a lump sum within 30 days of this date, and in default the former matrimonial home to be sold and the proceedings distributed in accordance with the terms of my order. The wife will be thus required to vacate the property upon the payment of the monies should the husband meet the conditions of my orders.
In considering this issue, I am conscious of the fact that each party made submissions to his Honour that he or she should have the opportunity to retain the former matrimonial home by paying out the other party. I have given consideration to the arguments advanced by them and in my view, a telling factor is that such a sale as ordered by his Honour would involve real estate agents’ fees and commissions together with legal fees. Thus, as opposed to his Honour, I do not see the sale of the property as the “only solution”. In any event, and in the exercise of my discretion, I am more attracted to the reasons advanced by the husband than that of the wife in coming to my determination as he is the sole registered proprietor and effectively built the home.
The husband will be entitled to retain 60 per cent of the assets set out by me in par 75 hereof totalling $284,300. As I said, I exclude the husband’s and the wife’s superannuation entitlements for the reasons stated. I also exclude from the pool of assets the husband’s post separation savings and contributions towards costs which I have taken into account in assessing the prospective adjustment pursuant to s 75(2) of the Act. With a 10 per cent adjustment in favour of the wife, she is entitled to receive 40 per cent of the assets amounting to $113,720. As she has had the use of the monies drawn down in the sum of $19,300, I will order that the husband pay to her the sum of $94,420. She will retain her superannuation entitlements of $20,741 and will have had the use of the monies drawn down by her in the sum of $19,300.

The husband’s entitlement to the assets will total $170,580 and he shall in addition retain his superannuation entitlements of $1,113.
It is my obligation in re-exercising the discretion to make an order that I consider to be appropriate in all the circumstances before me. I am not bound by the parameters set by the parties in the Notice of Appeal or in their respective Application and Response or their respective submissions. In my view, the orders I propose to make are just and equitable in the circumstances.

COSTS

At the conclusion of the hearing before me it was common ground between counsel for the husband and the wife that if the appeal were allowed on a matter of law they each receive a Costs Certificate pursuant to the provisions of the Federal Proceedings (Costs) Act (1981). I consider it appropriate in the exercise of my discretion to grant the appropriate certificate.

ORDERS

The orders of the court shall be:
1.That the appeal be allowed AND THAT paragraphs 1 to 5 (inclusive) of the orders made by Federal Magistrate Phipps on 16 December 2005 be set aside.
2.That the husband do pay or cause to be paid to the wife within 30 days of this date the sum of $94,420 (“the said sum”) as and by way of settlement of property.
3.That subject to paragraph 5 hereof, upon payment of the said sum by the husband, the wife do vacate the property situate at the former matrimonial home.
4.That the husband be solely responsible for and indemnify the wife against all liability for the loan of $24,000 made to the parties by the husband’s parents.
5.That in default of payment by the husband of the said sum referred to in paragraph 2 hereof the husband forthwith sign all documents and do all acts and things necessary to sell the said property and that the proceeds of sale be dispersed as follows:
(i)firstly, to pay the costs, commissions and expenses of sale;
(ii)secondly, to discharge the mortgage in favour of the Bank and registered over the said property;
(iii)thirdly, in payment of the said sum to the wife; and
(iv)fourthly, the balance to the husband absolutely.
6.That in the event of sale of the said property, IT IS FURTHER ORDERED that it be sold by public auction at a time and at a reserve price to be agreed between the parties (and if not agreed, as determined by the President of the Real Estate Institute of Victoria, or nominee) AND THAT liberty be reserved to both parties to apply to the Federal Magistrates Court in the event of any dispute or disagreement between them concerning the said sale.
7.That unless otherwise specified in these orders and save for the purpose of enforcing any money due and under these or any subsequent orders:
(i)each party be solely entitled to the exclusion of the other to all other proper (including choses in action) in the possession of such party as at the date of these orders, including motor vehicles, bank accounts, furniture, personal possessions and like chattels;
(ii)each party forego any claims that they may have to any superannuation benefits belonging to or earned by the other;
(iii)insurance policies remain the sole property of the owner named therein;
(iv)each party 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.
8.That the court grants to the husband a Costs Certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant in relation to the appeal.
9.That the court grants to the wife a Costs Certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by the respondent in relation to the appeal.

I certify that the preceding 92 numbered
paragraphs are a true copy of the
reasons for judgment herein of
the Honourable Justice Guest.

Associate to Guest J

[2006] FamCA 804

30 June 2006

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