Cadwell and Cadwell

Case •

[2009] FamCA 881

•

15 September 2009

FAMILY COURT OF AUSTRALIA

CADWELL & CADWELL [2009] FamCA 881
FAMILY LAW – PROPERTY – Settlement in relation to marriage – Initial contributions
Family Law Act 1975 (Cth) ss 75(2), 79
Lee Steere and Lee Steere (1985) FLC 91-626
Ferraro and Ferraro (1993) FLC 92-335
Hickey and Hickey (2003) FLC 93-143; 30 Fam LR 355
Coghlan and Coghlan (2005) FLC 93-220; 32 Fam LR 414
Clauson and Clauson (1995) FLC 92-595; 18 Fam LR 693
Pierce and Pierce (1999) FLC 92-844
APPLICANT: Ms Cadwell
RESPONDENT: Mr Cadwell
FILE NUMBER: SYC 4268 of 2008
DATE DELIVERED: 15 September 2009
PLACE DELIVERED: Sydney
PLACE HEARD: Sydney
JUDGMENT OF: Johnston JR
HEARING DATE: 23 July 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Rees
SOLICITOR FOR THE APPLICANT: Clayhills Solicitors
COUNSEL FOR THE RESPONDENT: Mr Heazlewood
SOLICITOR FOR THE RESPONDENT: Penhall & Co Laywers

Orders

  1. That paragraphs 9 and 10 of the orders of 10 September 2009 are discharged.

  2. That paragraphs 1 to 8 of the said orders are confirmed as final orders as set out hereunder:-

    1.That the wife forthwith and within 3 business days of the date hereof pay to the ANZ Bank account number […]35 all monies held by her, including interest in her account with BankWest except for $60,000.00, $30,000.00 of which shall be paid by her to each party.

    2.1That both parties are hereby restrained from taking, withdrawing or transferring any monies out of the following account, other than for the purposes of fulfilling these orders or with the prior written consent of both parties:  ANZ Bank account number […]35 (“ANZ Bank account”)

    2.2Each party must, within one (1) business day of the date of the making of these orders, notify the ANZ Bank of the terms and the effect of the above order 2.1.

    3.In order to give effect to order 1:-

    3.1The parties shall sign all auction authorities and pay all monies (if any) required to be paid to the Auctioneer within 7 days of the date hereof.

    3.2Either party may on behalf of both parties instruct the Solicitor to prepare a contract to enable the property to be sold in accordance with the Auctioneer’s selling program or requirements.

    3.3Both parties shall sign the auction contract within a reasonable time of being requested so to do by the auctioneer.

    4.The parties shall jointly instruct Mr John Anthony, solicitor of Newtown to have the carriage of the sale.

    4.1The parties should jointly instruct [Mr H] as their agent for the purpose of the sale and jointly negotiate the terms of the agency agreement and a reserve price.

    4.2The reserve price is $905,000.00.

    4.3The Auction shall proceed on Saturday, […] September 2009, or earlier if agreed.

    5.If the property is not sold at auction, a further auction shall be conducted within 2 months of the date of the failed auction and the reserve price for the property shall be 10% less than the reserve price of the property at the previous auction.

    6.If the property fails to sell at the second auction, then the wife be allowed to take up exclusive residence in the property and a further auction shall be conducted within a further 2 months at a reserve price of 10% less than the reserve price offered at the previous auction.  This procedure shall continue, that is there shall be an auction sale each 2 months and the reserve price shall reduce at each auction by 10% from the previous reserve price until a sale is achieved.

    7.If either party pays any fees such as advertising fees or other outgoings in respect of the auction or Solicitors costs prior to the conclusion of the sale of the property, then any monies so paid shall be reimbursed to such party out of the proceeds of sale before the nett proceeds of sale are distributed between the parties.

    8.If the Auctioneer or nominee recommends that any monies be paid to any person to undertake any work in respect of the property prior to sale, then any monies so expended shall be reimbursed to the party who paid them prior to a distribution of the proceeds of sale.

  3. The proceeds of sale of the former matrimonial home known as E property shall be paid as follows:

    3.1      To pay agent’s costs and costs of sale including legal costs;

    3.2      To discharge the mortgage and

    3.3To pay 57.031 percent of the balance to the wife and 42.969 percent thereof to the husband

  4. The parties are forthwith to do all things and sign all documents necessary to transfer half of the jointly owned shares in IAG to each of them or in such other proportions as they might otherwise agree with an appropriate cash adjustment.

  5. Otherwise the parties are declared pursuant to s 79 of the Act to each be the sole owner of all other property and superannuation in their possession and/or control respectively.

  6. All exhibits are to be released.

  7. Both parties shall have liberty to re-list these proceedings on 7 days notice in relation to the implementation of these orders.

  8. The above orders shall not commence operation until 30 September 2009.

  9. Both parties shall have liberty to re-list these proceedings for the purposes of further submissions in relation to the form of the orders only at any time until 29 September 2009.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 4268 of 2008

MS CADWELL

Applicant

And

MR CADWELL

Respondent

REASONS FOR JUDGMENT

Introduction and Applications

  1. These are property proceedings. The parties are Ms Cadwell and Mr Cadwell.  For convenience I shall refer to them as “the wife” and “the husband” respectively.  They have been unable to agree about a property settlement and have applied to the Court to assist them by determining their respective applications.

  2. The wife seeks orders to the effect that she would enjoy 65 percent of the property available for division other than the property owned by the husband in Brazil.

  3. On the other hand the husband seeks orders which would reflect an equal division of the property available for division between the parties.

Background

  1. The husband was born in 1959 and the wife was born in 1959.  They commenced cohabitation on 26 December 1986.  They married in 1989 and separated on 7 October 2007.  There are two children of the marriage C born in August 1989 and C born in January 1994.

  2. At the time the parties commenced cohabiting the wife’s property consisted of her interest in her former matrimonial home.  The wife was working at a Bank.  Within a few months of commencing to reside with the husband the wife and her former husband sold their home and the wife received $10 000.

  3. The wife used this money as the deposit on a home unit at S, New South Wales.  The wife purchased this property in May 1987 for $52 000. She borrowed the balance from her employer Bank.

  4. On the other hand, at this time the husband’s property consisted of an interest in land in Brazil.  He was working as a tradesman.

  5. In December 1987 the parties went on a holiday to Brazil for 6 months.  They lived with the husband’s relatives.  The wife took long service leave.  She rented the S property to friends of the husband.  Sadly the wife’s father died while they were in Brazil.  So they returned to Australia and resumed their employment.

  6. The wife received $40 000 from her father’s estate.  She used this money to pay out the mortgage.

  7. As indicated above, C was born in August 1989.  The wife continued to work until a couple of weeks prior to the child’s birth.  Within a few weeks of his birth the wife commenced working part time from home and in a different capacity at night.

  8. In 1990 the parties and C went to Brazil. In Brazil they lived in a property which the husband had been given by his mother.  It is common ground that the parties undertook some renovations to this property while they were living there.  The wife described this work as having been extensive and involving putting a new roof on the house, redoing the bathroom, landscaping, rendering and painting.  The husband said that the work involved minor repairs to walls, painting part of the house and planting some lawn and 2 palm trees.  I am unable to determine which of these accounts is more likely to be correct.  To fund this trip and to pay for the renovations the wife obtained an overdraft for $20 000 secured against the S property.

  9. This property in Brazil was subsequently transferred by the husband to the fiancée of his late brother because the husband and family members considered it the proper thing to do.  The wife agrees that this was appropriate.

  10. They intended to live in Brazil for some years.  But the parties’ child C became sick and they decided to return to Australia after approximately 12 months.

  11. The husband then started working for an engineering company.  The wife resumed employment.

  12. In June 1992 the parties purchased the property at E in joint names.  The purchase price was $175 000.  The wife sold her S property and used the net proceeds of sale of almost $75 000 towards this purchase.  The parties borrowed $100 000 from the wife’s employer Bank to assist in the funding.

  13. As indicated above, the parties’ son D was born in January 1994.

  14. At approximately this time the parties commenced renovating their home.  The husband replaced the bathroom.  He later removed internal walls and repaired, sanded and polished the floors.  He also painted the interior of the home.

  15. The husband also set up a building partnership with the wife trading as R Company.  After operating during the first year in partnership the husband subsequently conducted the business as a sole trader.

  16. In approximately 1997 or 1998 the parties arranged an overdraft of $100 000 secured against their home.  This was primarily to fund the costs of the children’s private school education.  But the parties also used the overdraft for business and private purposes from time to time.

  17. In approximately 2001 or 2002 the husband commenced construction of a substantial extension at the rear of the parties’ home.  This comprised an en suite bedroom, office/rumpus room, pantry, laundry with toilet, decking, rear porch, carport, landscaping and paving, painting the whole house inside and out and sanding, and polishing, floors throughout the home.  Much of the work was undertaken by the husband at night and on weekends.

  18. In March 2004 sadly the husband’s father died.

  19. In early 2007 the parties loaned $20 000 to the wife’s sister.

  20. As indicated above, the parties separated on 7 October 2007.  The parties had previously obtained a line of credit from the ANZ Bank in the sum of $420 000.  I shall refer to this account in further detail below because it raises a keenly contested issue between the parties.

  21. At separation the wife left the former matrimonial home and commenced residing in a rented apartment.  The husband remained living in the home. The parties agreed that the former matrimonial home had a rental value of approximately $700 per week.  On the basis that the husband would remain living in the home the parties agreed that the husband would pay the wife $350 each week as her share of the rental value of the home.  The husband paid such amounts to the wife until June 2008 when he ceased making such payments.  Apparently the parties were endeavouring to negotiate a property settlement at this time.

  22. The wife had been using the money towards payment of her rent on her apartment.  When the husband stopped making these payments the wife commenced withdrawing $500 per week from the parties’ joint line of credit for the purpose of paying her rent.

The anz bank joint line of credit

  1. As indicated above the movements of funds in this account and how the Court should regard these is a matter about which the parties strongly disagree.  As at 13 November 2007 the account balance owing was $57 156.40.  On 21 November 2007 the wife withdrew $40 010 from the account leaving the balance owing of $97 166.40.  On 26 November the husband deposited $10 000 from his business.  This amount included $5000 loan repayment from the wife’s sister.  The husband deposited a tax refund cheque of $3578 to the account on 10 December 2007.  The husband has not operated the account since then.  The account balance was debit $92 713 as at 2 January 2009.  The remaining $15 000 owed by the wife’s sister was deposited to the account in February.

  2. On 2 January 2009 the wife withdrew $302 730.  But there was an unfortunate series of events which preceded this action by the wife. 

  3. In October 2008 the husband had informed the wife that he was proposing to go to Brazil for three months.  He sent her an email on 25 October 2008 in which he suggested that she might like to move back into the home and on his return from Brazil he would paint the home and then they could put it on the market for sale.

  4. The wife replied on the same day informing the husband that she did not wish to move twice and suggested he fix the home before going away.  But by mid-November the wife had decided that she would like to move back into the home and her solicitor sent a letter to this effect.

  5. The husband arranged for the wife’s mother to occupy the former matrimonial home while he was away in Brazil.  The relationship between the wife and her mother completely broke down many years ago.  So the wife became very angry about the husband arranging for her mother to live in the home in the husband’s absence.

  6. There followed a period of some upset.  The wife arranged for the locks on the former matrimonial home to be changed.  The wife’s mother then arranged for the locks to be changed again.  The wife said that this had the effect of preventing the children, who until that time had been living week about in the home, from collecting their personal possessions from the home.

  7. In any event, on 28 December 2008 the wife received an email from the husband.  This was at a time after the husband had gone to Brazil and following the wife expressing to him her considerable displeasure that he had permitted her mother to occupy the home.  In the email the husband included the following:

    I will spend the hole (sic) house money to proove (sic) to you that we did 50-50 each.

  8. The wife said that she became very concerned that the husband could access the ANZ joint line of credit and that the amount which could still be drawn down was approximately $360 000.  She said that she was worried that he might remove the funds to Brazil.  She said that she went to the Bank and asked whether she could remove the husband’s signature from the account and was told that the Bank could not do that.  In these circumstances the wife opened an account in her name with BankWest.  She withdrew $302 730 from the ANZ line of credit on 2 January 2009 and deposited this to her BankWest account.  This money remains in this account.  To their credit the parties have agreed that the wife will transfer these funds to their ANZ line of credit account.

  9. Unfortunately there has been a financial cost in this action by the wife.  This is because the interest on the joint line of credit is approximately $1700 per month yet the wife receives only $1015 per month interest on the funds in BankWest.  This represents a loss of $685 per month.

  10. It is submitted on behalf of the husband that there should be a set-off of 2½ percent of the property available for division between the parties in favour of the husband to take account of this situation and also the fact that the wife withdrew $500 per week from the line of credit account from June 2008 as referred to above.

  11. I must say I am unpersuaded by this submission.  Firstly, so far as it relates to the withdrawals of $500 it is clear that the parties had agreed to the earlier arrangement that the husband would pay the wife $350 as her half of the rental value of the former matrimonial home.  Given that he had the sole occupancy of the home, he could hardly complain that when he stopped making the $350 payments to the wife that she would endeavour to use some of the parties’ funds to put towards her rent.  On this basis, the husband’s only reasonable complaint could be with respect to the difference between the $350 and the $500 which the wife withdrew namely $150 per week.  Over the whole period this would be an amount of approximately $9000.  But account also needs to be taken of the fact that the husband went to Brazil and left the wife with the whole of the burden of parenting and providing for the children as well as denying her the saving in rent which would have been available to her if he had permitted her to move back into the former matrimonial home in his absence.

  12. So far as the remaining part of this submission is concerned, that is about the monthly loss of $685, there are the following relevant matters.  On any interpretation the husband had acted towards the wife in a provocative way by arranging for her mother to live in the former matrimonial home.  This could only have upset the wife and increased her suspicions about the husband.  Against this background, in my view, it is not all that surprising that the wife, upon receiving the husband’s email on 28 December 2008 threatening to use in effect whatever money he could find to fund his litigation against her, acted in the way that she did.  Even if one was to take a different view of this, the husband did not instruct his solicitor to endeavour to arrange with the wife’s solicitors for the monies to be repaid to the ANZ line of credit account.  So at least to some extent the husband has acquiesced in the unfortunate waste which has been ongoing.

  13. In these circumstances, in my view, it is unnecessary for there to be any adjustment of available property as submitted on behalf of the husband.

The Applicable Law

  1. Sub-section 79(1) of the Act provides that in property settlement proceedings, the Court may make such order as it considers appropriate.

  2. Sub-section 79(2) provides that the Court shall not make an order under the above sub-section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.

  3. There is a long-standing preferred approach to the determination of an application brought pursuant to the provisions of s 79.  This involves four inter-related steps.  Firstly, the Court should make findings about the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing.  Secondly, the Court should identify and assess the contributions of the parties within the meaning of ss 79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties.  Thirdly, the Court should identify and assess the relevant matters referred to in ss 79(4)(d), (e), (f) and (g), including, because of s 79(4)(e), the matters referred to in s 75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two.  Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case. 

  4. This approach has been confirmed in numerous cases in this Court including for example Lee Steere and Lee Steere (1985) FLC 91-626; Ferraro and Ferraro (1993) FLC 92-335; Hickey and Hickey (2003) FLC 93-143; 30 Fam LR 355; Coghlan and Coghlan (2005) FLC 93-220; 32 Fam LR 414 and Clauson and Clauson (1995) FLC 92-595; 18 Fam LR 693.

Property available for division

  1. The property available for division between the parties consists of the following:-

$

1.         Former matrimonial home at E

900,000

2.         Bankwest investment

305,919

3.         Husband’s Brazil property

35,000

4.         Wife’s CBA investment account

900

5.         Wife’s Toyota Corolla motor vehicle

17,000

6.         Wife’s legal costs paid (add back)

20,000

7.         Husband’s CBA savings account

2,800

8.         Husbands’ HSBC account

3,000

9.         Husband’s Toyota Hiace motor vehicle

17,000

10.      Husband’s motorbike

2,500

11.      Husband’s R Company

7,000

12.      Jointly held IAG shares

6,867

_____________

$1,317,986

  1. Each of the parties has an interest in superannuation.  The wife’s interest in the HESTA Superannuation Fund has a value of $35 000.  The husband’s interest in his superannuation has a value of $32 566.  The parties have agreed that each will keep their superannuation and they do not wish the Court to make any order in relation to their superannuation.

  2. The only liability is the current outstanding balance on the ANZ joint line of credit which is $433 799.

  3. The surplus of assets (excluding superannuation) compared with liabilities has a value of $884 187.

Contributions

  1. This is an area of major dispute between the parties.

  2. It was submitted on behalf of the wife that her contributions both financial and to the welfare of the family including the children have been significantly greater than those of the husband.  In particular learned counsel for the wife pointed to the fact that when the parties commenced cohabitation the wife had her interest in her former matrimonial home which became paid to her in the form of $10 000.  The wife then used this $10 000 as the deposit on her home unit at S as indicated above.  Within approximately 18 months of commencing cohabitation the wife had received her inheritance of $40 000 which she then used to pay out the mortgage on the home unit.  So that at a time which must have been less than 18 months after the parties commenced cohabiting the wife owned her S unit unencumbered.  The husband can only be regarded as having made a very small indirect financial contribution to this unit at this time and a very small contribution to its maintenance.

  3. As also indicated above this property was sold to assist in the funding of the purchase of the former matrimonial home at E.  The net proceeds of sale were almost $75 000 and these monies were used towards the purchase of the E home which cost $175 000 plus costs.  On any view, this was a most significant financial contribution.

  4. Both parties worked in paid employment throughout the marriage.  It is clear that the wife only removed herself from the paid workforce for very brief periods around the times of the births of the two children.  The husband worked initially for employers and later in his own building business as I have said.

  5. Both parties also made significant contributions to the welfare of their family comprising themselves and the two children and as homemakers and parents.  I am satisfied that the wife has undertaken more of the domestic work and the parenting than the husband has.  But, to an extent, this is offset by the contributions the husband has made by all the renovation, construction and maintenance work he has undertaken in relation to the E home.  While he was doing building work on this the wife was having to accept a higher level of responsibility for attending to the children’s needs than otherwise would have been the case.

  6. The major area of difference between the parties in terms of their submissions in relation to assessment of contributions is about how the Court should regard the imbalance in their respective asset positions at the time the wife used her inheritance to pay out the mortgage on her S home unit.

  7. In this regard the following submissions were made on behalf of the husband:

    Where the marriage is of considerable duration, the greater the likelihood that the various contributions of each of the parties will be treated as equal, even where the financial contribution of one has been considerable.  See In the Marriage of Harris (1991) 15 Fam LR 26 and see also In the Marriage of Pierce (1998) 24 Fam LR 377, which discusses the erosion effect and In the Marriage of Aleksovski (1996) 20 Fam LR 894, where it was suggested that the passage of time is the element which reduces the significance of initial or early contributions. 

    Marriage involves a myriad of matters, large and small, which go to make up that union and differentiate it from more casual transitory relationships.  It involves sharing the minutiae of daily life, support during good and bad times, care and intimacy.  These other matters are intended to be encompassed by the matters in s.79, the actual balance of those components varying from marriage to marriage.  Fogarty & Lindenmayer JJ, Kennon v Kennon (1997) FLC 92-757.

    Marriage is and should be regarded as a genuine partnership, to which each brings different gifts. The fact that one is productive in money in large quantities is no reason to disadvantage the other (Figgins).

    Reference is made to Mallett v Mallett (1984) FLC 91-587. Members of the High Court made the following observation in relation to matrimonial relationships - that the relationship ordinarily involves “a practical union of both lives and property” and that the acquisition of assets, such as a matrimonial home, can be seen as representing “the fruits of totality of efforts of wage earning homemaking and mutual support.”.

    The Court’s role in proceedings under s.79 is not akin to an accounting exercise.  Rather, the Court is required to make a holistic value judgment in the exercise of a discretionary power of a very general kind.  Harris v Harris (1991) FLC 92-254 15 Fam LR 26 citing McLelland J in Davey v Lee (1990) 13 Fam LR 688.

    The case of Pierce referred to above may have had some impact on the matter if the parties had been married for a shorter period. 

    The Court would have no difficulty therefore in assessing the contributions of the parties as being equal as at the date of separation.

    Since separation the husband has been living in the former matrimonial home and has been meeting the outgoings.  This therefore would not cause any necessity for an adjustment in the initial contribution.

  8. On the other hand it is submitted on behalf of the wife that the wife’s contributions in all relevant areas have been greater than those of the husband.  It is submitted that when one considers this, along with the initial significant disparity between their asset positions, then the ultimate assessment of contributions must favour the wife.  And it favours the wife to the extent that the Court should order that she enjoy 65 percent of the available property other than the husband’s property in Brazil.

  9. I note that in the case of Pierce and Pierce (1999) FLC 92-844 the Full Court was considering the appropriate finding about contributions in circumstances where there was a very significant imbalance between the husband and wife in their initial financial contributions.

  10. The Full Court was discussing different approaches which had been taken by senior judges of the Court to dealing with this and said as follows at pages 85,880 and 85,881:

    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 ((1994) FLC 92-485) 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”.”

    However, it is important to put that quotation in its correct context.  Fogarty J in Money and Money (above) said at page 81,054:-

    “I am unable to agree with the criticism by his Honour in 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 (1985) FLC 91-626 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”.

    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: …

  11. Accordingly, in the present case, the Court is required to weigh the initial contributions by the wife with all other relevant contributions.  As I have said the wife’s contribution of the S unit was significant and it was instrumental in enabling the parties to fund the purchase of their home at E, and it was a substantial contribution thereto.  Having said this, there have been numerous and significant contributions made by each of the parties since purchasing the E home as well as prior thereto.  Clearly these are not to be ignored.  When one considers the totality of all these contributions they well outweigh the initial contributions.

  12. It was submitted on behalf of the wife that she should have 65 percent of the assets other than the husband’s land in Brazil.  In my view, this implies a finding on contributions of 65 percent.  In my view this is too high and such a finding would not give sufficient regard or weight to all the contributions apart from those made by the wife in contributing her S unit.

  13. On the other hand, a finding of equality of contributions overall as urged on behalf of the husband would not involve sufficient regard to the wife’s contribution of her S unit.

  14. When the Court steps back and views the entirety of the parties’ contributions over all the years since they commenced cohabitation, in my view, it is clear that the wife has made a greater level of contributions than the husband.  But this is not by a substantial margin.  In all the circumstances, in my view, the contributions should be assessed as having been 54 percent by the wife and 46 percent by the husband.

s 75(2) matters

  1. The wife is 49 years of age and she is in reasonable health.  Her income is $1113 per week consisting of her salary of $981 and her estimate of interest she has been receiving for the BankWest investment of $127.  The wife is employed full-time in the health field.  She would appear to have the capacity to be able to continue working in this, or similar, capacity for many years.  As indicated above, she has an interest in superannuation in a similar amount to that which the husband has.

  2. The husband is 50 years of age and he is also in reasonable health.  His income is $1005 per week which is similar to that of the wife.  He earns an estimated $1000 per week from his business as a licensed builder.  He would appear to have the capacity to continue to earn income at this rate for many years.  I have referred to his superannuation.

  3. The parties share the parenting responsibilities for their younger son D who lives with each of them on a week about basis.

  4. It was submitted on behalf of the husband that the parties’ circumstances and responsibilities are broadly similar and that this is not a case which would attract some set-off in the available property in favour of one or other party.  This submission accords with my view.  There was no contrary submission made on behalf of the wife.

  5. In these circumstances in my view it is not appropriate to make any adjustment of property from that found to be appropriate in respect of the parties’ contributions.

Conclusion and fourth step

  1. The wife is to have 54 percent of the property available for division between the parties.  This is property with a value of $477 461 (54 percent of $884 187 is $477 461).

  2. The wife has the following property:

$

1.         CBA investment account

900

2.         Toyota Corolla motor vehicle

17,000

3.         Legal costs paid (add back)

20,000

4.         Half of IAG shares

3,434

_____________

$41,334

  1. For the wife to achieve property with a value of $477 461 she will require additional property with a value of $436 127 ($477 461 - $41 334 = $436 127).  This can only come from the former matrimonial home.  It is agreed that this home will have to be sold.  On the basis of its agreed value of $900 000 there is equity therein of $772 120 ($900 000 - $433 799 + $305 919 = $772 120).  If the wife was to be paid $436 127 from this the balance of $335 993 ($772 120 - $436 127 = $335 993) would be available for the husband.

  2. On the other hand the husband is to have 46 percent of the available property.  This is property with a value of $406 726 (46 percent of $884 187 = $406 726).  The husband has the following property:

$

1.         Brazil property

35,000

2.         CBA savings account

2,800

3.         HSBC account

3,000

4.         Toyota Hiace motor vehicle

17,000

5.         Motorbike

2,500

6.         R Company

7,000

7.         Half of IAG shares

3,433

_____________

$70,733

  1. To achieve property with a value of $406 726 the husband would require additional property with a value of $335 993 ($406 726 - $70 733 = $335 993).  This will come from the equity in the former matrimonial home.

  2. The orders I propose will not affect the income-earning capacity of either of the parties.

Developments since the completion of the hearing

  1. Since I arrived at the above conclusion there have been further developments which have caused me to have to adjust the figures to take into account some interim orders since made.

  2. At the hearing the parties agreed that I would make orders in a form which they had agreed for sale of the former matrimonial home.  The parties have since been in dispute about the details of arrangements for the sale of this home.  The matter was relisted before me on the application of the wife only on 9 September 2009.  The wife sought specific orders for the sale of the home.  I adjourned the wife’s application to 10 September 2009 and then both parties appeared.

  3. The parties subsequently agreed on the form of the orders for sale of their home.  On 10 September 2009 I made the following orders by consent:

    INTERIM ORDERS

    1.That the wife forthwith and within 3 business days of the date hereof pay to the ANZ Bank account number […]35 all monies held by her, including interest in her account with BankWest except for $60,000.00, $30,000.00 of which shall be paid by her to each party.

    2.1That both parties are hereby restrained from taking, withdrawing or transferring any monies out of the following account, other than for the purposes of fulfilling these orders or with the prior written consent of both parties:  ANZ Bank account number […]35 (“ANZ Bank account”)

    2.2Each party must, within one (1) business day of the date of the making of these orders, notify the ANZ Bank of the terms and the effect of the above order 2.1.

    3.In order to give effect to order 1:-

    3.1The parties shall sign all auction authorities and pay all monies (if any) required to be paid to the Auctioneer within 7 days of the date hereof.

    3.2Either party may on behalf of both parties instruct the Solicitor to prepare a contract to enable the property to be sold in accordance with the Auctioneer’s selling program or requirements.

    3.3Both parties shall sign the auction contract within a reasonable time of being requested so to do by the auctioneer.

    4.The parties shall jointly instruct Mr John Anthony, solicitor of Newtown to have the carriage of the sale.

    4.1The parties should jointly instruct [Mr H] as their agent for the purpose of the sale and jointly negotiate the terms of the agency agreement and a reserve price.

    4.2The reserve price is $905,000.00.

    4.3The Auction shall proceed on Saturday, 19 September 2009, or earlier if agreed.

    5.If the property is not sold at auction, a further auction shall be conducted within 2 months of the date of the failed auction and the reserve price for the property shall be 10% less than the reserve price of the property at the previous auction.

    6.If the property fails to sell at the second auction, then the wife be allowed to take up exclusive residence in the property and a further auction shall be conducted within a further 2 months at a reserve price of 10% less than the reserve price offered at the previous auction.  This procedure shall continue, that is there shall be an auction sale each 2 months and the reserve price shall reduce at each auction by 10% from the previous reserve price until a sale is achieved.

    7.If either party pays any fees such as advertising fees or other outgoings in respect of the auction or Solicitors costs prior to the conclusion of the sale of the property, then any monies so paid shall be reimbursed to such party out of the proceeds of sale before the nett proceeds of sale are distributed between the parties.

    8.If the Auctioneer or nominee recommends that any monies be paid to any person to undertake any work in respect of the property prior to sale, then any monies so expended shall be reimbursed to the party who paid them prior to a distribution of the proceeds of sale.

    9.That each party receive $150,000 from the proceeds of sale of the property, on completion thereof.

    10.That any surplus proceeds of sale of the property be held in the following controlled monies account, pending distribution pursuant to final orders:-

    10.1G. N. Penhall controlled monies account with the National Australia Bank;

    10.2and distributed therefrom in accordance with the final orders.

    11.Liberty to apply on 48 hours notice.

    12.Costs reserved.

  4. In the circumstances of each party having received a payment of $30 000 from the monies which the wife had held in her BankWest account there will need to be an adjustment of what each of them will be entitled to from the net proceeds of sale of the former matrimonial home referred to in the conclusion above.

  5. The adjusted equity in the home is $712 120 ($772 120 - $60 000 = $712 120).

  6. Instead of the wife being entitled to receive $436 127 she shall receive $406 127 ($436 127 - $30 000 = $406 127) or 57.031 percent of the equity in the home taking account of the payments to the parties.

  1. Instead of the husband being entitled to receive $335 993 he will receive $305 993 ($335 993 - $30 000 = $305 993) or 42.969 percent of the said equity.

I certify that the preceding seventy-eight (78) paragraphs are a true copy of the Reasons for Judgment of Judicial Registrar W P Johnston

Associate:     

Date:              15 September 2009

Key Legal Topics

Areas of Law

  • Family Law

  • Equity & Trusts

Legal Concepts

  • Remedies

  • Costs

  • Injunction

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Cases Citing This Decision

0

Cases Cited

2

Statutory Material Cited

1

Kennon & Kennon [1997] FamCA 27
Harris v Harris [2021] NSWCA 329