Caldwell and Wolyniec
[2007] FMCAfam 742
•27 September 2007
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CALDWELL & WOLYNIEC | [2007] FMCAfam 742 |
| FAMILY LAW – Alteration of property interests – notional add back of assets disposed of after separation – whether moneys advanced to wife amount to a gift or a loan – financial impact of criminal conduct by husband – consideration of wife retaining matrimonial home. |
| Family Law Act 1975, ss.79, 79(2), 79(4), 75(2), 75(2)(o) |
| Hickey and Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143, (2003) 30 FamLR355 Russell (1999) FLC92-877, (1999) 25 FamLR 629 Omacini (2005) 33 Fam LR 134 at p144, (2005) FLC 93-218 at p79, 617 DJM and JLM (1998) 23 Fam LR 396; (1998) FLC 92-816 Townsend (1994) 18 Fam LR 505; (1995) FLC 92-569 Kowaliw (1981) FLC 91-092; (1981) 7 Fam LR N13 Biltoft (1995) 19 Fam LR 82 at p 94; (1995) FLC 92-614 at p82, 127 Antmann (1980) FLC 90-908 at p75, 744 AB v GB (No 2) (2005) 34 Fam LR 82 Gosper (1986) 11 Fam LR 601; (1987) FLC 91-818 Kessey (1994) 18 Fam LR 149; (1994) FLC 92-495 Pierce (1998) 24 Fam LR 377; (1999) FLC 92-844 Coghlan (2005) 33 Fam LR 414; (2005 FLC 93-220 |
| Applicant: | SUZANNE MAREE CALDWELL |
| Respondent: | LEO JOHN WOLYNIEC |
| File Number: | NCM 818 of 2006 |
| Judgment of: | Lapthorn FM |
| Hearing date: | 3 July 2007 |
| Date of Last Submission: | 3 July 2007 |
| Delivered at: | Tamworth |
| Delivered on: | 27 September 2007 |
REPRESENTATION
| Counsel for the Applicant: |
| Solicitors for the Applicant: | Michael Dennis |
| Counsel for the Respondent: | Mr John Hamilton |
| Solicitors for the Respondent: | Rice More & Gibson |
ORDERS
That within 28 days the Husband do all acts and things and sign all documents necessary to transfer to the Wife the registration of the 2003 Toyota Camry motor vehicle registration number AQC20Y.
That within 28 days the parties do all acts and things and execute all documents necessary to place the real property situate at 93 The Avenue, Armidale in the State of New South Wales (hereinafter referred to as (“the Property”) and more particularly described as being the whole of the land comprised in the Certificate of Title Folio Identifier 44/1008452 for sale by private treaty upon the following terms:
(a)The real estate agent and or the listing price for the sale of the Property shall be as agreed between the parties or failing agreement shall be determined by the President of the Real Estate Institute of New South Wales or his or her nominee.
(b)The proceeds of the sale of the Property shall be disbursed as follows:
(i)In discharge of the mortgage to Perpetual Limited;
(ii)In payment of all real estate agent’s commission and advertising expenses;
(iii)In payment of all legal expenses of the sale;
(iv)The net proceeds of the sale to be divided as to 80% to the wife and 20% to the Husband.
(c)The Wife be entitled to the exclusive occupation of the Property until such time as the completion of the sale of the Property.
In accordance with paragraph 90MT(1)(b) of the Family Law Act 1975:
(a)The wife is entitled to be paid the specified percentage of a splittable payment out of the husband’s interest in the Police Superannuation Scheme; and
(b)The husband’s entitlement, and the entitlement of such other person to whom a splittable payment may be made to payments out of the husband’s interest in the funds, is correspondingly reduced.
2.The specified percentage for the purposes of clause 3(a) of this order is 49%.
3.This order have effect from the operative time and the operative time is the date of this order.
4.The Trustee of the Police Superannuation Scheme shall do all such acts and things and sign all such documents as may be necessary to:
(a)Calculate, in accordance with the requirements of the Family Law Act 1975, the entitlement created by clause 3(a) of this order; and
(b)Pay the entitlement whenever a splittable payment becomes payable out of the husband’s interest in the funds.
5.The solicitor for the wife is to serve a copy of these orders on the Trustee of the Police Superannuation Scheme within 28 days.
6.The parties and/or the Trustee of the Police Superannuation Scheme has liberty on 7 days notice in writing to re-list the matter in relation to implementation of this order within 28 days of the Trustee being served with a copy of the order.
Subject to these orders; as between the parties the Husband be declared to have the sole, right, title and interest in:
(a)Any chattels, goods, furnishings and other property that are at the date hereof in his possession;
(b)Any moneys, investments and shares that stand in his sole name;
(c)Any superannuation not already provided for in these orders; and
(d)The 2005 Holden Astra motor vehicle registration number AWX 19T.
As between the parties the Wife be declared to have the sole, right, title and interest in:
(a)Any chattels, goods, furnishing and other property that are at the date hereof in her possession;
(b)Any moneys, investments and shares that stand in her sole name; and
(c)Her superannuation entitlements.
Subject to these orders the Husband and the Wife shall indemnify each other in respect of all other liabilities, debts and claims howsoever incurred by the respective parties whether now or in the future and whether in Equity or at Law.
The parties do all such acts and execute all such instruments, documents, authorities and writings as are necessary to put into effect the orders contained and set out herein.
If either party refuses or neglects to sign (within 14 days of written request to do so) any documents necessary to effect the terms of these orders a Registrar of the Newcastle Registry of the Federal Magistrates Court of Australia is hereby appointed pursuant to the provisions of Section 106A of the Family Law Act to execute such documents on behalf of such party.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT ARMIDALE |
NCM818 of 2006
| SUZANNE MAREE CALDWELL |
Applicant
And
| LEO JOHN WOLYNIEC |
Respondent
REASONS FOR JUDGMENT
Introduction
The applicant wife, Suzanne Maree Caldwell and the respondent husband, Leo John Wolyniec ask the court to make orders in relation to property distribution upon the breakdown of their 19 year marriage.
In 2006 the husband was convicted of dishonesty charges and was subsequently dismissed from his employment as a police officer. This was a significant event in the family’s life and the court has been invited to consider the consequences of the husband’s conduct when deciding the appropriate distribution. Also at issue between the parties is: whether the wife has a loan from her parents; how the husband’s interest in his late mother’s estate should be taken into account; whether some funds should be added back into the asset pool; whether the court should make orders that would allow the wife to retain the matrimonial home; and what should be done in relation to their superannuation.
Background
The husband and wife commenced a relationship in 1985 and married the following year. They separated on 6 November 2005 and were divorced on 8 February 2007. They remain living in Armidale. The husband is 46 years of age and the wife is 44.
The parties have two children: 17 year old Emma and Nathan who is 13. Both children attend O’Connor Catholic College. Emma is in year 11 and will complete her Higher School Certificate in 2008. Nathan is currently in year 8 and the parties expect he will continue on to complete his Higher School Certificate. The children’s relationship with their father has broken down since the separation and the father no longer sees them.
The Evidence
The wife relied on her affidavit and financial statement filed on 14 May 2007, the affidavit of her father Patrick Caldwell, filed 25 May 2007 and the affidavit of her solicitor Michael Dennis filed 21 May 2007.
The husband relied on his affidavits filed on 27 June 2006 and 22 June 2007 along with his financial statement also filed on 22 June 2007.
A number of documents were tendered and I had the opportunity to observe both parties and Mr Caldwell in the witness box. All witnesses gave their evidence forthrightly and to the best of their ability.
The law
In determining property proceedings the court is required to conduct a four staged process. The first task is to identify the assets, liabilities and financial resources of the parties at the time of the hearing. The court then considers the contributions made by the parties before looking at their future needs. Finally the court needs to be satisfied that the orders are just and equitable.[1]
[1]S79 Family Law Act; Hickey and Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143, (2003) 30 FamLR 355; Russell (1999) FLC92-877
The property of the parties
The parties remain in dispute as to what should be included in the pool of assets and liabilities. I will address each of these issues independently.
Notional Add Backs to the list of Assets
It is open to a court, in appropriate circumstances to exercise its discretion and notionally add back into a pool of assets for distribution funds that no longer exist. The adoption of that course will depend on the facts of each case. The Full Court of the Family Court in Omacini[2] summarised the three categories of such cases:
a)Where the parties have expended money on legal fees[3];
b)Where there has been a premature distribution of matrimonial assets[4]; and
c)Where a party has by a course of conduct reduced the value of an asset or where the party has acted recklessly, negligently or wantonly with the matrimonial assets effectively reducing their value[5]
Should the Husband’s leave entitlements received on termination of employment be added back into the asset pool and if so what is the appropriate figure?
[2] (2005) 33 Fam LR 134 at p144, (2005) FLC 93-218 at p79,617
[3] DJM and JLM (1998) 23 Fam LR 396; (1998) FLC 92-816
[4] Townsend (1994) 18 Fam LR 505; (1995) FLC 92-569
[5] Kowaliw (1981) FLC 91-092; (1981) 7 Fam LR N13
The husband’s employment with the Police was terminated on 20 July 2006 and he received a gross amount of $61,048.45 by way of termination payment. This took into account all his leave entitlements. $18,400 was forwarded to the Australian Tax Office leaving him a net figure of $42,648.45. The wife argues that the $61,048 should be added back into the asset pool. The husband says neither figure should be added back but if there is to be an add back the net figure is the appropriate one.
The basis for the wife’s argument is that the payment arose from leave entitlements accrued during the marriage that otherwise would have been available to the parties. According to the wife the gross figure is the appropriate one because the husband is likely to receive a tax refund when he lodges his return. The husband argues that the funds were utilised for his day to day living expenses and therefore should not be added back. If that argument does not find favour the husband argues that the net figure is the appropriate one as that is the amount he has received. It is not possible to determine what if any refund the husband is likely to receive from the tax office. It was conceded by counsel for the husband that it was open to the court to take the possible refund into account in considering the factors under s 75(2)(o) but the court would still not be able to quantify the sum.
I accept the wife’s argument that the leave entitlement accrued during the marriage. The entitlement having vested into money should be treated as an asset. I am not persuaded however to accept the submission that the appropriate figure for consideration is the gross amount. The husband only received the lesser amount and although there may be a tax refund due to the husband the court is not able to quantify that.
The husband gave evidence that he received the $42,648 on 2 August 2006 and by 28 September he had $25,171 left. All of this had been dissipated by about February or March of 2007. I accept the husband has used some of these funds for day to day expenses, payment of child support and the acquisition of some household furniture. I am not persuaded however that all of these funds could have been reasonably utilised for such expenses. I find that the husband has had the benefit of these funds.
The Full Court in Townsend[6] considered the sale by the husband of a taxi licence. The husband had dissipated the whole of the proceeds of sale. He used some of it to pay loans, legal fees and for the day to day expenses of himself and the children when they were with him. The trial judge had found that such expenditure would not account for all of the dissipation and the husband had the sole benefit of the funds that no longer existed for distribution. The trial judge took that fact into account under s75(2)(o). Nicholson CJ with whom Fogarty and Jordan JJ agreed said:
“In my view, what occurred in this case, as I said during the course of argument was, in fact, a premature distribution of a proportion of the matrimonial assets. What the husband did was to distribute to himself an asset in which the wife had a legitimate interest. In such circumstances I consider that it would be unjust in the extreme to simply treat such conduct by the husband as a matter to which regard should be had under s 75(2). It seems to me that the husband has had the benefit of that money. Had he retained, for example, the taxi licence instead of selling it, that would have been brought into account as an item of property which would have been dealt with in the same way as the remaining items of property in this case. Accordingly, I am of the view that the correct way in which to deal with the husband’s receipt of those moneys is to bring them into the pool of assets on a notional basis and make a distribution accordingly”[7]
[6] (1995) 18 Fam LR 505
[7] ibid at pp 509-510
The same could be said in this case. If the husband had retained the proceeds of the leave entitlements they would have been available for distribution at these proceedings.
In Townsend the then Chief Justice went on to highlight a number of expenditures that warranted the making of deductions from the notional add back. Mr Wolyniec purchased items for his home to the value of $2500 and they are reflected in the list of assets. It would be double accounting to not deduct that sum from the amount notionally added back.
It was argued in Townsend that the notional add back should also be reduced by taking into account day to day expenditure such as rent and food. This was rejected by the Full Court. Nicholson CJ found that the wife also had those types of expenses and therefore it was not appropriate to take those matters into account.
I find that the appropriate figure for add back is $40,148 being the net sum received less the cost of purchasing the household items already listed in the pool of assets.
Should the funds received by the wife from the sale of her NAB shares be added back into the pool of assets?
Prior to the marriage the wife bought shares in the National Australia Bank from funds lent to her from her father. The husband said that the loan for their purchase was paid back from their joint funds however I accept the evidence of the wife and her father that this loan was paid back prior to the marriage.
After separation the wife sold 132 of these shares and received $4,782. The wife used $2,000 of this to fund a holiday which she alone enjoyed. The remainder was used for the family.
Although the wife paid for the shares before the marriage they formed part of the assets of the parties at the time of separation. In selling them there has been a partial distribution of the property and it is appropriate to add them back into the pool where they will be taken into account when the court considers contributions.
Should the funds received by the husband from the sale of the Toyota Hi-Lux motor vehicle be added back into the pool of assets?
During the marriage the husband drove a Toyota Hi-Lux. This motor vehicle was purchased using a personal loan that was later refinanced through the mortgage on the matrimonial home. After separation the husband sold the motor vehicle and received $4,800.
The wife argues that as the husband has had the benefit of those funds they should be notionally added back. Counsel for the husband argued that it would be appropriate to add this amount back but not include his current vehicle and corresponding debt because the proceeds of sale went towards the purchase of the new vehicle. If this is the case there would be double accounting of the $4,800. However as the solicitor for the wife pointed out there was no evidence of the husband using these funds for that purpose. Consequently I am unable to make a finding as to how the husband used the money. In those circumstances I find that it is appropriate that the amount of $4,800 be notionally added back into the pool of assets and that the current motor vehicle and debt to GE Money remain in the list.
Are the moneys provided to the wife by her parents a gift or a loan? If they are a loan should they be added to the List of Liabilities?
The wife gave evidence that she owes her parents $24,900. She calculates this sum from various moneys provided to her after separation. These funds were largely used to make mortgage payments and to cover rates and insurance. The first sum advanced was $500 which the wife gave to the husband so he could pay a rental bond on his new home. Some of the mother’s legal fees were paid from the moneys as well as the payment of debts to AGC and MasterCard. The wife also purchased firewood and assisted Emma to travel overseas during 2006.
The wife says that she has to pay her parents back. The evidence surrounding each advance was vague but I am satisfied that whenever the wife asked either of her parents for an advance there was an understanding between all concerned that the moneys would be repaid. Mr Caldwell gave evidence that he expected to be repaid at the conclusion of the proceedings from the proceeds of the sale of the home. The husband disputes this and argues that the funds provided amount to a gift. It was submitted that no contract was drawn up evidencing any debt and that the wife’s parents would not sue for non-payment which was conceded by the wife and her father.
I accept the evidence of the wife and her father that there is an expectation of the monies being repaid at the end of these proceedings. I therefore find that the moneys advanced amount to an unsecured loan. I am further satisfied that the wife’s father will not bring proceedings against the wife to recover the debt. The amount of the loan is significant and I accept Mr Caldwell’s evidence that he and his wife are not comfortably well off.
In Biltoft[8] the Full Court held:
“Notwithstanding the general practice which has developed, the court has indicated that it may properly determine not to take into account or to discount the value of an unsecured liability in certain circumstances. Such liabilities would include but are not limited to a liability which is vague or uncertain, if it is unlikely to be enforced or if it was unreasonably incurred.”
[8] (1995) 19 Fam LR 82 at p 94; (1995) FLC 92-614 at p82,127
Even though it is open to the court to exclude the debt I take into account that the overwhelming majority of the funds were used towards the payment of the mortgage and other debts thereby maintaining the financial position of the parties. For this reason I am satisfied that the debt should be taken into account and included in the list of liabilities.
What interest does the husband have in the estate of Josephine Wolyniec?
The husband’s mother passed away on 20 February 2005 but her estate is yet to be finalised. The estate is to be shared between the husband and his two sisters, Rosemary Maihofer and Barbara Riddell. There is a dispute between the three of them as to moneys loaned to Ms Riddell from their mother before her death. Because of this dispute it is not possible to be precise as to the extent of the husband’s interest in the estate. For the purposes of these proceedings he originally estimated that he would receive $30,000 but in his most recent Financial Statement he reduced that sum to $25,000.
Before the court is a letter dated 14 March 2007 from Rice More & Gibson to L Rundle & Co[9]. This letter outlines the anticipated value of the estate at $95,624.47. An offer was made to Ms Riddell’s lawyers that she accept $15,000 leaving $80,000 to be divided between the husband and Ms Maihofer. The offer had not been accepted by the date of the hearing.
[9] Exhibit H3
As Probate had not issued it is not possible to determine a precise figure the husband will receive. I am satisfied however that he is likely to receive between $25,000 and $30,000 once all expenses are taken out. I note that both parties accept that as the funds have not been released to the husband it remains a financial resource and an exact determination of the figure is not necessary.
Conclusion as to Pool of Assets and Liabilities
I find from the evidence that the assets of the parties at the date of the hearing are as follows:
| ASSETS | POSSESSION | VALUE |
| Matrimonial home | Joint | $460,000 |
| 2003 Toyota Camry | Joint | 17,500 |
| 2005 Holden Astra | Husband | 20,000 |
| Household contents | Husband | 2,500 |
| Household contents | Wife | 5,000 |
| NAB Shares | Wife | 695 |
| Notional add back of funds received by the wife from the sale of NAB shares | Wife | 4,782 |
| Notional add back of funds received by the husband for leave entitlements upon termination (less $2,500 for the cost of household contents already included in this list) | Husband | 40,148 |
| Notional add back of funds received by the husband from the sale of the Toyota Hi-Lux | Husband | 4,800 |
| TOTAL ASSETS | $555,425 |
| LIABILITES | ||
| Mortgage over Matrimonial Home | Joint | 231,000 |
| MasterCard | Wife | 4,000 |
| GE Money | Husband | 22,000 |
| Visa | Husband | 2,500 |
| Unsecured debt owed by the wife to her parents | Wife | 24,900 |
| TOTAL LIABILITIES | $284,400 |
| TOTAL NET VALUE (excluding superannuation) | $271,025 |
| SUPERANNUATION | ||
| State Authorities Non-Contributory Scheme | Husband | 23,846 |
| Police Regulation (Superannuation) Act | Husband | 356,637 |
| REST | Husband | 954 |
| The Portfolio Service | Wife | 31,132 |
| TOTAL SUPERANNUATION | $412,569 |
| FINANCIAL RESOURCES | ||
| Husband’s interest in estate of Josephine Wolyniec | Husband | $25,000 – 30,000 |
Contributions
I now turn to the second step in the exercise namely an assessment of the parties’ contributions.[10]
[10] Section 79(4)
Should the husband’s criminal conduct be taken into account in assessing contributions?
The wife argues that as a result of the husband’s “wanton” act in committing the criminal offences there has been a significant effect on the finances of the family. Prior to the husband losing his employment he was earning around $70,000 a year. With that income gone there has been less funds available to care for the children and to provide for the future of the family. The court has been invited to take his actions into account either when considering contributions or any adjustment under s 75(2)(o) but not both.
In Kowaliw[11] Baker J held that if a party carries out a course of conduct intended to reduce or minimise the value of matrimonial assets or acts “recklessly, negligently or wantonly” with those assets then such conduct and the economic consequences that follow should be taken into account when considering the provisions of s 75(2)(o).
[11] (1981) FLC 91-092 at p76,645; (1981) 7 Fam LR N13
In Antmann[12] the Full court rejected an argument that where one party unilaterally closed a business, the income from which supported the family, such action should be treated as a negative contribution. The court went on to say that if the other party took over the business it was open to the court to take into account that party’s increased burden of contribution otherwise any “waste” committed by a party may be more appropriately considered under s 75(2)(o).
[12] (1980) FLC 90-908 at p75,744
Ryan FM, as she then was, in AB v GB (No 2)[13] considered the approaches to be adopted in cases where assets have been wasted or there has been conduct by one party such that the family has suffered economic loss. Her Honour held that economic loss may be treated as a premature distribution of the asset pool and added back as an asset of the party who has had the benefit of the funds rather than being considered under s 75(2)(o) as the later approach may lead to an unjust result if the s 75(2) findings are applied to a depleted asset pool. In that case the husband had gambling losses amounting to $80,000 which her Honour treated as a notional add back but he had also stopped making payments on a mortgage leaving the bank to take recovery action. Her Honour found the husband was reckless in not paying the mortgage and made an adjustment in the wife’s favour under s 75(2)(o).
[13] (2005) 34 Fam LR 82
I have already found that it is appropriate to add back the funds received by the husband for his leave entitlements. Apart from that asset there are no other specific assets that can be said to have been depleted. It is not open to the court to treat the husband’s conduct as a negative contribution[14]. The facts in this case are analogous to those in Antmann where the husband unilaterally closed the family business. Mr Wolyniec by his own actions has lost access to a relatively high income and secure employment with the police. As a consequence of that he is less able to provide for the family than he once was. I am of the view that the consequences of the husband’s actions are more appropriately taken into account under s 75(2)(o). The approach may have been different if the husband had gambled away or otherwise wasted a pre-existing asset of the parties.
[14] Antmann (1980) FLC 90-908
Contributions at the commencement of the relationship
At the beginning of the marriage each party had modest savings, a motor vehicle and some personal items. The wife also held shares in the National Australia Bank some of which she has now sold. The parties received a $10,000 gift from the husband’s mother and a $20,000 gift from the wife’s parents. This money was used towards the purchase of their first home. I ascribe these gifts as contributions made by the party whose parent provided the gift.[15] Taking into account the NAB shares and the difference in family gifts I find that at the commencement of the relationship the wife made a greater financial contribution than the husband.
[15] Gosper (1986) 11 Fam LR 601; (1987) FLC 91-818. Kessey (1994) 18 Fam LR 149; (1994) FLC 92-495
Contributions during the marriage
As a result of the husband’s employment as a police officer the parties moved from town to town. The husband maintained full time employment until his dismissal from the police force in 2006. The wife had various part time and some full time positions with different banking institutions throughout the marriage and obtained for the parties some benefit by securing reduced interests rates for housing loans. The wife received from her employer in 1989 a payout of $7,678 which was used towards the mortgage. In 2005 she began full time employment as a personal assistant with Bridges Personal Investments Services and remains in that position today. The husband earned a greater income than the wife during the marriage. He now works as a truck driver and was unemployed for some time after his dismissal from the police.
It was conceded by both parties that they equally contributed to the non-financial contributions to the family.
The wife argues that the court should find that she has made a greater contribution up to separation taking into account the initial contributions, the payout of $7,678 received in 1989 and the reduced interest benefits. Although I take those factors into account when I consider the husband’s overall greater financial contribution through his employment and the length of the marriage I find that until separation the contributions between the parties were equal.[16]
[16] Pierce (1998) 24 Fam LR 377; (1999) FLC 92-844
Post separation Contributions
Since separation the husband’s relationship with the children has broken down leaving a greater burden on the wife to provide for the children in both a physical and financial sense. I give some weight to this when I consider the post separation contributions.
I also take into account that after separation the husband was assessed to pay child support but fell into arrears. He made voluntary lump sum payments in August and October 2006 totalling $1,275.40 and in December $2,406.04 was taken from his bank account by garnishee. Between September 2006 and February 2007 the husband paid the minimal amount of child support but he is currently paying $465.33 per month pursuant to the most recent assessment.
Conclusion as to Contributions to non-superannuation property
When I weigh up the equal contributions at separation with the greater contribution by the wife post separation I assess that overall the wife has made contributions to the non-superannuation assets of 52% to the to the husband’s 48%.
Consideration of Superannuation contributions
Both parties submitted that given the extent of the superannuation interests it would be appropriate to assess the contributions thereto separately from the other assets. The court has discretion as to whether the superannuation should be treated in the list of property or by way of a separate list.
If the later approach is adopted it is prudent to assess the relative contributions to that superannuation by the parties.[17] I have found the contributions during the marriage to be equal. As the superannuation interests of the parties were acquired during the marriage I find that there has been an equal contribution to that superannuation. For this reason there should be a notional distribution of the superannuation between the parties of 50% each. The orders may reflect a different distribution depending on my findings as to what is just and equitable under the final stage of the process.
[17] Coghlan (2005) 33 Fam LR 414; (2005) FLC 93-220
Section 75(2) factors
Having determined the contribution elements the court is required to have regard to the provisions of s 75(2).
Both parties are in their mid 40s and are of good health. Neither has re-partnered and they each have employment with similar incomes. Their future superannuation is also likely to be similar.
I do not accept the husband’s argument that the wife’s parents are a financial resource to her. Although they have assisted her through this period since separation I find that the parents are keen to get their money back after these proceedings and they are not a ready source of funds for her.
The husband is likely to receive between $25,000 and $30,000 when the probate issues on his mother’s estate. This is a financial resource and is not included in the pool available for distribution between the parties but I take it into account in determining any s 75(2) adjustments. I have not taken into account the possibility of the husband receiving a tax refund on his leave entitlements as there is insufficient evidence as to quantum.
The wife has the care of the children. Emma has another year to go before she completes her HSC and Nathan is only 13. They do not see their father but he is now paying child support.
For the reasons I have previously discussed I take into account, pursuant to s 75(2)(o), the husband’s criminal conduct and the consequences that have flowed to the family from his loss of income.
Weighing all of these factors up I find that there should be an adjustment in wife’s favour of 15%.
Section 79(2) – just and equitable
The fourth stage of the process is to step back and assess whether in all of the circumstances it is just and equitable to make the orders proposed. It is the justice and equity of the actual orders that the court must consider.[18]
[18] Russell and Russell (1999) FLC92-877, (1999) 25 FamLR 629
Given my findings as to contributions and s 75(2)(o) factors the appropriate distribution between the parties should be 67% to the wife and 33% to the husband from the net asset pool excluding superannuation and 50% each in relation to the superannuation.
The wife seeks an order that she retain the matrimonial home and that the husband retain a greater share of his superannuation. In support of that proposition she argues that it is important for her to provide a home for Emma whilst she completes her Higher School Certificate. The husband accepts the merit in what the wife says however argues that the injustice to him in not receiving current cash assets and then having to wait many years until he can access his superannuation outweighs the benefit to Emma.
The wife argued that the husband has had the benefit of the proceeds of sale of the Toyota Hi-Lux and the leave entitlements. On the basis of the notional add backs that I have made this would amount to $44,948. The wife also says that the husband will receive about $30,000 from his mother’s estate. Because of this the wife argued that this is not a case where one party would receive the home and the other party only the superannuation.
The wife intends to sell the home once Emma finishes her HSC. Notwithstanding her father’s evidence that he expected the sale of the home to be soon after the end of these proceedings I accept the wife’s evidence in this regard.
I raised with both legal representatives the option of the court ordering the sale of the home to take place at the end of 2008 and for the distribution to be made then. Whilst both accepted that that option was open to the court, neither pressed it as their primary position. Although this option would alleviate the necessity of the wife and children having to move out of the home now I am of the view that it would be preferable for the parties to finalise their financial arrangements sooner rather than later.
Whilst there is much merit in the wife’s argument, on balance, I find that the husband needs to re-establish himself and although I take into account the funds he has already had access to and his interest in his mother’s estate he will need access to more immediate cash funds to do so.
I am persuaded that the appropriate outcome to achieve justice and equity between the parties is for the home to be sold and the non-superannuation property to be divided in accordance with my earlier finding of 67% to the wife and 33% to the husband. The superannuation should be divided 50% to each party and that can be achieved if a splitting order is made in relation to the husband’s major superannuation fund for 49% to the wife.
Structure of the Orders
Under the orders that I propose to make the husband will transfer to the wife his interest in the Camry motor vehicle whilst retaining his own motor vehicle and household items. He will retain his debts in the sum of $24,500. The wife will retain her NAB shares and household contents but also retain her MasterCard debt and the debt to her parents.
Given the 67/33 division, on the valuations before the court the wife will receive $181,587 of the net pool and the husband $89,438. Excluding the proceeds of sale of the home the net position for the husband is $42,948 and the wife is -$923. Taking those figures into account the wife should receive $182,510 and the husband $46,490 from the market value of the matrimonial home less the mortgage.
Real estate is subject to market variables so I propose to order a percentage division of the proceeds of sale to reflect that distribution. The appropriate percentage would be 80% to the wife and 20% to the husband after all associated expenses of sale are paid.
The table below sets out the effect of the proposed orders:
| Husband | |
| 2005 Holden Astra | 20,000 |
| Household contents | 2,500 |
| Notional add back of funds received by the husband for leave entitlements upon termination (less $2,500 for the cost of household contents already included in this list) | 40,148 |
| Notional add back of funds received by the husband from the sale of the Toyota Hi-Lux | 4,800 |
| GE Money | (22,000) |
| Visa | (2,500) |
| The net position for the husband excluding the matrimonial home | $42,948 |
| Proceeds of sale of the matrimonial home = approximately 20% of net value of home | 46,490 |
| Total distribution to the husband of non-superannuation assets and liabilities = 33% | $89,438 |
| Wife | |
| 2003 Toyota Camry | 17,500 |
| Household contents | 5,000 |
| NAB Shares | 695 |
| Notional add back of the proceeds of sale of the NAB shares sold | 4,782 |
| MasterCard | (4,000) |
| Unsecured debt owed by the wife to her parents | (24,900) |
| The wife’s net position excluding the matrimonial home | ($923) |
| Proceeds of the sale of the matrimonial home = approximately 80% of net value of the home | 182,510 |
| Total distribution to wife of non-superannuation assets and liabilities = 67% | $181,587 |
The Husband’s main superannuation fund is to be subject to a splitting order of 49% to the wife in order to achieve close to a 50% division between the parties. The table below sets out how this is achieved. I will give liberty to the trustee of the superannuation fund to have the matter re-listed in the event that the orders do not properly comply with their requirements.
| Superannuation | |
| Husband | |
| State Authorities Non-Contributory Scheme | 23,846 |
| Police Regulation (Superannuation) Act 51% | 181,885 |
| REST | 954 |
| Total Superannuation | $206,685 |
| Wife | |
| The Portfolio Service | 31,132 |
| Police Regulation (Superannuation) Act 49% | 174,752 |
| Total Superannuation | $205,884 |
Conclusion
Having considered the evidence and looked at the orders I am satisfied that justice and equity is achieved. For these reasons I make the orders set out at the commencement of this judgment.
I certify that the preceding sixty-nine (69) paragraphs are a true copy of the reasons for judgment of Lapthorn FM
Associate: Helen Drysdale
Date: 27 September 2007
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