Canon & Jennings
[2009] FMCAfam 285
•12 May 2009
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CANON & JENNINGS | [2009] FMCAfam 285 |
| FAMILY LAW – Parenting orders – equal time or substantial and significant time – husband is an artist and the impact of his commitments on capacity to care for the children. FAMILY LAW – Property settlement – valuation of parties’ art work and its division between them – contributions of parties – adjustment of section 75(2) factors. |
| Family Law Act 1975, ss.60B, 60CA, 60CC, 65DAA, 75, 79, 117 |
| In the Marriage of Whitely [1992] FLC 92-304 Hickey and Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143 |
| Applicant: | MS CANON |
| Respondent: | MR JENNINGS |
| File Number: | MLC 4971 of 2007 |
| Judgment of: | Bender FM |
| Hearing dates: | 23, 24, 25, 26 & 27 March 2009 |
| Date of Last Submission: | 27 March 2009 |
| Delivered at: | Melbourne |
| Delivered on: | 12 May 2009 |
REPRESENTATION
| Counsel for the Applicant: | Mr Cantwell |
| Solicitors for the Applicant: | Hogg & Reid |
| Counsel for the Respondent: | Self-represented |
| Solicitors for the Respondent: | Self-represented |
PARENTING ORDERS
All previous parenting orders be discharged.
The parties have equal shared parental responsibility for their children [X] born in 1997 (“[X]”) and [Y] born in 2000 (“[Y]”)
[X] and [Y] live with the husband as follows:
(a)each alternate week from after school Thursday to before school Tuesday, commencing the next week from the date of these orders that the husband is not working in Bendigo;
(b)for half of each of the term school holidays as agreed between the parties and failing agreement, the first half in odd numbered years and the second half in even numbered years;
(c)for half of the long summer holidays as agreed between the parties and failing agreement, the first half of the 2009/2010 long summer vacation and each alternate year thereafter and the second half of the long summer vacation in 2010/2011 and each alternate year thereafter;
(d)from 5.30 pm Christmas Eve to 5.30 pm Christmas Day 2009 and each alternate year thereafter;
(e)from 5.30 pm Christmas Day to 5.30 pm Boxing Day 2010 and each alternate year thereafter;
(f)from 5.30 pm Easter Saturday to 5.30 pm Easter Monday in 2010 and each alternate year thereafter;
(g)from 10.00 am Good Friday to 5.30 pm Easter Saturday in 2011 and each alternate year thereafter;
(h)from 10.00 am on the day preceding Father’s Day until before school Monday in the event Father’s Day falls when [X] and [Y] are not living with the husband;
(i)if [X], [Y] or the husband’s birthdays fall whilst [X] and [Y] are living with the wife, at such times as are agreed between the parties and failing agreement, from after school until 8.00 pm if a school day and from 11.00 am to 3.00 pm if a weekend or non-school day; and
(j)at such other times as agreed between the parties.
[X] and [Y] otherwise live with the wife.
The care arrangements set out in order 3(a) herein be suspended during the school term and long summer holidays and recommence the first Thursday of each term.
The husband’s care of [X] and [Y] shall otherwise be suspended as follows:
(a)from 5.30 pm Christmas Day to 5.30 pm Boxing Day 2009 and each alternate year thereafter;
(b)from 5.30 pm Christmas Eve to 5.30 pm Christmas Day 2010 and each alternate year thereafter;
(c)from 5.30 pm Easter Saturday to 5.30 pm Easter Monday 2011 and each alternate year thereafter;
(d)from 10.00 am Good Friday to 5.30 pm Easter Saturday 2010 and each alternate year thereafter;
(e)from 10.00 am the day preceding Mother’s Day to before school Monday in the event Mother’s Day falls when [X] and [Y] are not with the wife; and
(f)
if [X], [Y] or the wife’s birthdays fall when [X] and [Y] are living with the husband, at such times as agreed between the parties and failing agreement, from after school until 8.00 pm if a school day and from 11.00 am to 3.00 pm on a weekend or
non-school day.
Each party be entitled to telephone [X] and [Y] between 7.00 pm and 7.30 pm on any day that [X] and [Y] are in the care of the other party.
Whichever parent [X] and [Y] are living with in the second half of the long summer vacation shall be responsible to make arrangements for [X] and [Y]’s care during any work commitments they have at that time.
When changeovers do not take place at [X] and [Y]’s schools, the parent with whom [X] and [Y] are about to live with shall collect them from the other parent’s residence.
Each party will ensure that [X] and [Y] attend all their extra-curricular activities.
Each party may attend all of [X] and [Y]’s school events usually attended by parents, as well as their extra-curricular activities.
Each party shall keep the other informed at all times of their current residential address, email address and contact mobile and landline telephone numbers and the address and contact telephone numbers of where [X] and [Y] will be staying in the event either party takes them on holidays.
The parties shall advise the other of any medical or health emergency or accident involving [X] and [Y] whilst in their care and shall provide them with the names and contact details of any treating medical and health professionals and authorise such professional to speak and consult with the other party.
Once the parties have finalised their living arrangements, each of the wife and the husband shall:
(a)attend and complete, as soon as practicable, a Parenting Apart post separation parenting program ("the program") at an organisation or organisations as nominated by the Dispute Resolution Coordinator of the Federal Magistrates Court of Australia;
(b)sign all such documents and do all such acts and things as shall be necessary to enrol in, undertake and successfully complete the program;
(c)pay and otherwise be responsible for all costs associated with the program; and
(d)provide an appropriate certificate of completion of the program to the other parties or their solicitors.
PROPERTY ORDERS
BY CONSENT
The parties sell the art work titled “[W]” on such terms and conditions as agreed between them and utilise the net proceeds of same for the children’s education.
The husband and wife shall divide the approximate 500 books contained in the two wooden bookcases, comprising eleven shelves of assorted books, equally between them by agreement.
The wife shall retain the furniture and chattels in the house on the matrimonial property, exclusive of any art works or items listed in the “Mr L List”.
The husband shall retain the furniture and chattels in the studio on the matrimonial property, exclusive of any art works or items listed in the “Mr L List” (save for the “quantity of assorted free-standing supports” identified on page 6 of the Mr L List, which the husband shall retain).
BY THE COURT:
The husband is declared the sole owner of:
Art Works (using item numbers 1-911 allocated in the document headed “Complete list of artworks in possession of Mr Jennings and Ms Canon” filed by the husband on 4 September 2008):
(a)Items 1-39;
(b)Items 500-553;
(c)Item 570;
(d)Item 209;
(e)Item 447;
(f)Item 456;
(g)Item 457;
(h)Item 469;
(i)Item 470;
(j)Item 366;
(k)Item 367;
(l)Items 137-139;
(m)Item 149;
(n)Items 155-159;
(o)Items 180-182;
(p)Item 199;
(q)Item 205;
(r)Item 206; and
(s)Item 208
Mr L List (taken from valuation of Mr L contained in his affidavit sworn on 22 September 2007):
(a)1 volume “Mumfie’s Uncle Samuel”;
(b)1 volume “The Happy Prince and other Stories”;
(c)1 volume “The Arabian Nights”;
(d)Vesta Box Collection;
(e)1 volume “Aesop’s Fables”;
(f)2 leather bound volumes “Inferno” and “Purgatory and Paradise”;
(g)1 volume “Coming down the Wye”;
(h)1 volume “Sweet Cork of Thee” printed 1952;
(i)1 volume “Coming down the Seine” printed 1953;
(j)1 volume “Grimm’s Fairy Tales”;
(k)1 volume “Four Hedges, a Gardener’s Chronicle”;
(l)1 volume “Coconut Island”; and
(m)1 volume “Apres Midi d’unfaune”.
The wife is declared the sole owner of:
Art Works (using item numbers 1-911 allocated in the document headed “Complete list of artworks in possession of Mr Jennings and Ms Canon” filed by the husband on 4 September 2008):
(a)Item 810;
(b)Item 811; and
(c)Item 897
Mr L List (taken from valuation of Mr L contained in his affidavit sworn on 22 September 2007):
(a)1 Camera Tri Pod;
(b)1 Potters Wheel; and
(c)6 Wooden Lawn Bowls
The market value of the art works for the purpose of these proceedings is ten percent of the value ascribed to them in the valuation annexed to the affidavit sworn by Mr T on 2 July 2008.
The parties shall divide the art works between them on the basis they each receive works that represent 50 percent of the value of the works in accordance with the valuation determined in order 21 herein.
To give effect to order 22 herein, the husband shall retain item numbers 140, 146, 148, 187, 207, 890, 211, 216, 229, 233, 246, 261, 267, 268, 272, 274, 438 and 406, and the wife shall retain item numbers 151, 153, 161, 165, 205, 264, 269, 275, 280, 436, 745, 768, 789, 790, 797, 802, 887 and 889, and thereafter the husband shall select fifty items from the list and thereafter the wife select fifty items from the list, and then each in turn until the equal division has been finalised.
The parties shall divide the items contained in the Mr L valuation (excluding those items declared to be their sole property pursuant to order 19 and 20 herein, and the bookcase which is to be divided equally between the parties) equally between them on the basis they each receive items that represent fifty percent of the value of such items in accordance with Mr L’s valuation (such total value being $10,918.00).
To give effect to order 24 herein, the husband shall retain the following:
(a)Victorian white iron and brass bed ends (two pieces);
(b)“A General history of Quadrupeds” by Thomas Bewick, 1820;
(c)“A History of British Birds” by Thomas Bewick, 1836 (2 vol);
(d)“Wood Engraving Folio” by Thomas Bewick, 1982;
(e)“Waiting for Death” by Thomas Bewick;
(f)“Fables” by Walter Brown;
(g)“A Treatise on Wood Engraving” by John Jackson, 1839;
(h)“Wagner’s Music Drama of the Ring” engravings by Paul Nash, 1925;
(i)“Glory of Life”, Golden Cockerel Press; and
(j)Private Columbian ornate printing press
and the wife shall retain the following:
(a)John Deere L100 5-speed ride-on mower;
(b)Stihl whipper snipper;
(c)Antique cast iron mangle;
(d)Hitachi drop head cut-off saw;
(e)Quantity oxy acetylene welding equipment;
(f)Private Imperial bench model book Binding Press;
(g)Private Hopkinson & Cope, Finsbury, London “Albion Press 3581” printing press;
(h)Victorian brass hanging off lamp with old holder, burner and shade;
(i)Small cast iron book binder’s table model press; and
(j)Petrol driven generator
and thereafter the husband shall choose one item and the wife shall choose one item and each in turn until the equal division has occurred.
Any taxation liability incurred by the husband arising from the transfer of any of his works of art to the wife that are deemed to be “trading stock” by the Australian Taxation Office shall be paid equally by the parties.
The husband shall pay to the wife the sum of $254,546.60 “the payment” within 60 days (“the date”).
Contemporaneously with the payment:
(a)the wife do all such things necessary to transfer to the husband at his expense all of her right, title and interest in the former matrimonial home at Property N, , being the whole of the land more particularly described in Certificate of Title Volume [3] (“the real property”);
(b)the husband indemnify the wife in respect to all payments and liability pursuant to the mortgage to the Bendigo Bank and all apportionable rates, taxes and outgoings of or with respect to the real property of whatsoever nature and kind; and
(c)the wife shall vacate the real property.
In the event that the whole of the payment has not been made by the date then:
(a)the husband shall vacate the real property and thereafter the wife shall be solely responsible for all mortgage payments to the Bendigo Bank;
(b)the wife shall advise the husband in writing within 30 days of the date whether she is in a position to purchase the real property from the husband for the amount set out in paragraph 29(c) herein;
(c)in the event the wife advises the husband of her ability to purchase the real property pursuant to order 29(b) herein, the wife shall pay to the husband the sum of $132,972.40 (“the second payment”) within 60 days of the date (“the second date”); and
(d)upon the making of the second payment:
(i)the husband shall transfer to the wife at her expense all of his right, title and interest in the former matrimonial home at Property N, being the whole of the land more particularly described in Certificate of Title Volume [3] (“the real property”); and
(ii)the wife indemnify the husband in respect to all payments and liability pursuant to the mortgage to the Bendigo Bank and all apportionable rates, taxes and outgoings of or with respect to the real property of whatsoever nature and kind.
In the event the wife chooses not to purchase the real property pursuant to order 29(b) herein and/or fails to make the second payment by the second date, then the real property be immediately placed on the market for sale on such terms and conditions as agreed between the parties (“the sale”) and upon completion of the sale, the proceeds of same be applied:
(a)firstly, to pay all costs, commissions and expenses of the sale;
(b)secondly, to discharge the mortgage and any other encumbrances affecting the real property;
(c)thirdly:
(i)40% thereof to the husband, less the sum of $27,127.60 which shall be payable to the wife; and
(ii)60% thereof to the wife, plus the sum of $27,127.60 referred to in order 30(c)(i) above.
Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under there or any subsequent orders:
(a)each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) owned by or in the possession of such party as at the date of these orders;
(b)insurance policies remain the sole property of the owner/beneficiary named thereon;
(c)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; and
(d)any joint tenancies of the parties in any real or personal estate is hereby expressly severed.
COSTS
Within 60 days, the husband pay the wife’s costs of the fifth day of the hearing, fixed in the sum of $3,550.00 and the costs of the second sworn valuation prepared by Mr M, fixed in the sum of $1,540.00, making a total of $5,090.00.
IT IS NOTED that publication of this judgment under the pseudonym Canon & Jennings is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
MLC 4971 of 2007
| MS CANON |
Applicant
And
| MR JENNINGS |
Respondent
REASONS FOR JUDGMENT
Introduction
The wife is seeking orders in respect to both the arrangements for the parties’ children [X] born in 1997 (“[X]”) and [Y] born in 2000 (“[Y]”) and a division of matrimonial property.
I am a little unsure as to the wife’s final proposal in relation to the arrangements for [X] and [Y]. In her outline of case document, her proposal is that [X] and [Y] live with her and spend time with the husband each alternate weekend from after school Friday to
5.30 pm Sunday and each Wednesday from after school to 7.30 pm – OR in the alternative – each alternate weekend from after school Friday to before school Monday.
Counsel on the wife’s behalf, in his opening address to the court, advised the wife sought orders that [X] and [Y] spend time with the husband each alternate weekend from after school Friday to
5.30 pm Sunday and each Wednesday from after school to 7.30 pm, but posited this may not be feasible because of the husband’s work commitments.
In his closing, the wife’s Counsel advised the wife was seeking orders that [X] and [Y] spend time with the husband each alternate weekend from after school Friday to before school Monday, and as a “secondary” position from after school Friday to before school Monday and from after school to 7.00 pm Wednesday. I will, for the purposes of this judgment, accept that the wife’s proposal for [X] and [Y] is as per that put on her behalf by her Counsel in his closing statements.
In relation to property matters, the wife is seeking an “in specie” division of the parties’ considerable art and artefact collection, to retain the former matrimonial home and that there be an adjustment of their assets, excluding art work and superannuation, on the basis she receives 65% of those assets.
The husband seeks orders that the children live with each of himself and the wife on a week-about basis, for half holidays and special days.
In relation to property matters, the husband agrees to an in specie division of the parties’ considerable art and artefact collection, seeks to retain the former matrimonial home and that there be an adjustment of their assets, other than artwork and superannuation, on the basis the wife receives between 55 and 60% of those assets.
Background
The husband was born in 1962 in Wales and is 47 years of age. He is an artist/sculptor/engraver and teaches art part-time at [C] in Melbourne and [L] University at the Bendigo campus.
The wife was born in 1964 and is 44 years of age. She is an artist and works part-time as an [occupation omitted]
The parties met in Melbourne in 1984. They commenced co-habitation in May 1987 in New York. They travelled to England where they married in 1989.
The wife returned to Australia in January 1989 and the husband followed some six months later where he took up a role as Artist in Residence at [M] University.
Upon their return to Melbourne both parties pursued their artistic careers, holding exhibitions and obtaining commissions and grants. The wife completed post-graduate studies in fine arts at the Victorian College of Arts (“VCA”). The husband also obtained part-time employment teaching at [C] two days per week. Such employment continues to this day. The wife was also employed in various positions.
In 1993, the parties rented a very basic house “[A]” on several hectares in the [H] region where they remained living until 2003. At this time the wife obtained part-time employment as a [occupation omitted]. She continues in this employment to this day.
After the birth of the children, the wife’s artistic career took a back seat to that of the husband. The wife was the children’s primary carer.
The wife actively supported the husband’s artistic career. The husband is dyslexic and the wife was responsible for the written preparation of submissions and applications for grants and commissions on the husband’s behalf.
In 1996, the parties purchased the former matrimonial home situate at Property N (“[H]”) for $85,000.00. This was funded in part from their joint savings and a mortgage of $60,000.00. In October 2003, the parties moved to [H].
In 2004, the parties borrowed $45,000.00 and built a large studio on the [H] property. This was primarily used by the husband.
In July 2006, the parties separated. The wife and children remained living in the house on the [H] property. The husband moved into the studio. Both parties have remained living in these dwellings since.
Orders were made on 23 May 2007 for the children to live with the wife and spend time with the husband each alternate weekend from after school Friday until 6.00 pm Sunday, after school until 6.00 pm each Monday and Thursday and during school holiday periods. These arrangements, subject to some variation in 2008 when the husband was working in Bendigo every second Thursday, have remained in place since that time.
CHILDREN’S MATTERS
The wife’s proposal
As set out earlier in this judgment, it is the wife’s proposal that the children, [X] and [Y], live with her and that they spend alternate weekends from after school Friday to before school Monday with the husband as well as half holidays and special occasions.
It was her evidence that she has been the primary carer of the children since birth and it was she who put her artistic career on the back-burner in order to assume responsibility for the day to day care of the children. She was, and is, the one who makes arrangements for the children’s education, extra-curricular activities, doctor and dental appointments, attendance at school activities etc.
The wife concedes that the husband is a caring and loving father and that the children have a close and loving relationship with him. However, it is her position that the husband places his artistic career and it’s demands on his time ahead of the needs of the children. It was her evidence that during the marriage, the husband would be absent from home for quite lengthy periods in the pursuit of his artistic career. For example in 1993/1994, the husband was the Artist in Residence at [S] for six months. During this period, the husband would be in Sydney during the week and come home at weekends.
The husband’s work as a sculptor involves the creation of very large outdoor sculptures. These works are usually created in specialist studios away from the matrimonial home. This requires the husband to spend time away from the home. By way of example, in the six weeks leading up to the parties’ separation, the husband was in Melbourne working on a commission for almost all of that period.
The husband is employed on a part-time basis as a teacher at [C] each Tuesday and Wednesday. It was common ground that the husband stays in Melbourne on the Tuesday night. It was the wife’s evidence that the husband would also quite often remain in Melbourne on the Wednesday night and not return until the Thursday morning.
In 2008, subsequent to separation, the husband obtained a position as a lecturer at the Bendigo Campus of [L] University. This involved him working Thursday and Friday each fortnight. Because of this commitment, the husband was unable to spend time with the children each Thursday afternoon as is provided for in the consent orders.
The wife also raised concerns about the husband’s ability to care for the children for extended periods due to excessive alcohol consumption and drug usage, in particular marijuana. The husband conceded that there were times during the marriage where he did drink to excess, and that he did smoke marijuana. However, he says that this is no longer an issue and that he has not used marijuana since separation because he realised that this would negatively impact on his application before the court for equal time with his children.
It was the wife’s evidence that whilst this is what the husband is now saying, she has real doubts as to whether he will be able to continue to abstain once these proceedings have been finalised.
It was also the wife’s contention that because of the parties’ inability to communicate, it would not be possible for them to have in place the necessary levels of cooperation to enable a shared care arrangement to work effectively for the children.
The wife gave evidence of many instances where she and the husband had been unable to communicate.
It was her evidence that the husband lost his licence for drink-driving in 1995, but he only told her of this in December 2002. During this period, she did all the driving for the family. The husband’s explanation was that he was too embarrassed to tell her.
In November 2008, the husband placed plastic ties to lock down the water tanks that service the house and the studio prior to him going away for several days. The impact of this was to leave the house, where the wife and children were, without water for 24 hours. The husband’s explanation for this was that there had been three occasions where the studio water tank had been emptied and that he took this action to ensure that this did not occur whilst he was away. However, he conceded that he did not tell the wife that he had done this and that he had not thought of the impact that it may have on the wife and children’s ability to access water whilst he was away. It was his evidence that the ties were easily removed and the wife could have removed them at any time.
The wife alleged that during the course of the marriage, and particularly when under the influence of alcohol, the husband would become abusive and had on a number of occasions physically forced her out of the marital bed. The husband denied that this had ever occurred.
In 2008, the husband obtained employment at [L] University in Bendigo each alternate Thursday and Friday. This meant that he was unable to spend time with the children in accordance with the consent orders that had been entered into between the parties. There was an occasion when his commitments at the university had finished that both he and the wife arrived at the children’s school to pick them up. The husband had not told the wife he would be available to collect the children on that evening.
In the long summer vacation of 2008/2009, there was a lengthy exchange of emails between the parties trying to reach agreement as to where the children would spend the holidays. It was only some two days prior to the holidays that the husband agreed to the wife having the children for the first two weeks of those holidays. At the end of this time, the wife made the children available to the husband. However, as the husband had to work on 19 January 2009 (as did the wife), he returned the children to the wife’s care when it was her expectation that he would have them until the end of the holidays. Whilst this had been an issue for some time between the parties, something Dean Das confirmed, they were unable to reach any agreement as to what the arrangements should be.
The wife also raised concerns as to the husband’s ability to ensure that the children attended their extra-curricular activities. It was the wife’s evidence that the husband did not take the children to karate or callisthenics and did not take [Y] to ballet. Further, the wife alleged that they could not agree to arrangements for the children’s extra-curricular activities in 2009.
The husband’s proposal
It is the husband’s proposal that the children live with him and the wife on a week-about basis, for half holidays and special days.
His proposal is that on the Tuesday night that he is required to be in Melbourne because of his employment commitments, the children would return to live with their mother.
It was his evidence that he has a close and loving relationship with both his children and that he has had a significant role in their upbringing.
Mr Jennings gave evidence of his involvement with the children’s school. He has attended regularly for reading, for arts projects with the children and it was he who took [X] for English tutoring (like his father, [X] is dyslexic).
Whilst conceding that the wife has been the children’s primary carer, it was his evidence that because of their lifestyle as working artists, they have both been involved closely with their children on a day to day basis.
The husband conceded that since separation, he and the wife have had difficulty in communicating but alleged that this was an issue as much for the wife as it was for himself. He gave evidence of instances where the wife had called the police to the property over what he termed minor instances unnecessarily, causing upset to both himself and the children.
It was the husband’s evidence that he is able to adjust his work commitments to fit in with his obligations to care for the children.
It was his evidence that he could alter his hours at [C] in Melbourne to be able to finish at 3.30 pm on Wednesdays.
In relation to his part-time employment at [L] University in Bendigo, the husband said that in 2009 he re-negotiated the terms of his employment so that he works every second Friday from 8.30 am to 6.00 pm rather than every week. He said he is able to continue to have this level of input into the hours that he works so that they can be adjusted around his commitments to care for the children.
It was also his evidence that in the event he was able to retain the former matrimonial home and the studio, he would be able to organise his artistic pursuits around his commitments to care for the children.
The husband placed great reliance on the second report prepared by
Mr Dean Das in this matter. Mr Das indicated that the children had expressed a real desire to spend more time with their father and recommended a week-about arrangement.
Dean Das
Dean Das prepared two family reports in this matter, the first such report is dated 5 January 2008 and the second report is dated
22 December 2008.
In his first report, Mr Das commented on the warm, trusting and loving relationship the children had with each parent, independent of the other, and congratulated the parties on their commitment to the children and the quality of their relationship with the children.
However, Mr Das was most concerned that the conflict between the parents be reduced as much as possible and recommended that this could best be achieved by one or other of the parents immediately relocating to another home within the local area prior to any finalisation of property matters between them.
Mr Das made the following observation in paragraph 42 of his first report:
“It is the Writer’s opinion that in the long term, it would be psychologically and emotionally harmful for the children to continue to live in the present situation (sic with the mother in the home and the father in the studio) until the scheduled property settlement in April 2008.”
As an aside, this matter was to be heard on a final basis in April 2008. However, the matter could not be dealt with until March 2009. During this period, neither parent removed themselves from the matrimonial property.
In his first report, Mr Das rejected the husband’s proposal that there be a week-about arrangement for the children. In paragraph 44 of his report, he commented:
“The children made it known (especially [X]) that it was difficult ‘having to go from one place to another’… [X]…requires a stability of living environment and daily structures that is not offered through a ‘shared-care’ arrangement. Mr Jennings is a working artist who for two days per week, teaches in Melbourne. His hours as ‘a working artist’ dependant upon commissions, are diurnally and nocturnally irregular, and for two days a week,
Mr Jennings is required to travel to Melbourne. Ms Canon’s regular weekly working hours, provides her with more availability to spend designated quality time with the children.”
In those circumstances, in his first report, Mr Das recommended that the children reside with the wife and spend substantial time in the care of the husband.
Mr Das also strongly counselled both parents to desist from verbal argumentation and reciprocal negative comments in the presence of or hearing of either child.
In his second report, Mr Das’ recommendations as to the children’s living arrangements altered.
In paragraph 49 of this report, he says as follows:
“It was apparent to the writer that the children wished to spend more time – ie. 50/50% time with each of the parents. The children are a little older now than when previously interviewed and therefore were more definitive about their emotional and social needs. Whether they remain in the Property N property as their primary residence is now less important to them than wanting to spend sufficient time with their parents, and to maintain their social friendships and activities, whether at school or otherwise.”
In paragraph 50, Mr Das reports:
“In line with the above, it is the writer’s recommendation that an equal time shared-care arrangement be considered by the Court, on the proviso, that in 2009 Mr Jennings is prepared to adjust his work-schedule to the needs of the children, and to the satisfaction of the Honourable Court. If Mr Jennings is not prepared to do so, or it is not feasible for him to do so, the writer recommends that time be spent between the children and the father, each alternate weekend from Friday to Monday, and for one overnight stay during each week, on a night that causes the lest disruption to the children’s school and out-of-school routines.”
In his second report, Mr Das reported that both children had indicated to him in interview that they had observed much less conflict between their parents. In paragraph 27, Mr Das reports:
“[X] stated that the verbal arguments between his mother and father had become ‘much, much, much rarer’ and ‘less disturbing’”.
In paragraph 32 of his report, Mr Das states:
“[Y] spoke warmly of her relationship with both her mother and father, and how, in the past, she had been upset by their behaviour toward each other. Like [X], she reported that things had improved over time, and ‘they don’t fight much now’”.
Mr Das was cross-examined as to the reasons why he had changed his recommendations as to the arrangements for the children between his first and second reports.
Mr Das said there were a number of reasons. Firstly, he thought that there may be less conflict between the parties than when he first saw them. Mr Das was asked whether perhaps it was a case rather that the parents, to their credit, were not exposing the children as much to their level of conflict. Mr Das said:
“From the evidence that has been presented here today, from what I have heard today, it would appear certainly that is true, that they just better hid it from the children, but certainly the children were less exposed, according to the children, to the arguments and conflict.
Mr Das was asked whether it could have been the case that the children just didn’t simply want to tell him about the conflict. Mr Das responded:
“The children were pretty open about what was going on and about the conflict and how much they hated it, so therefore its not in character really for the children to, in the second report, to actually just want to hide it. I don’t believe that’s true. I think these children genuinely felt that there was less conflict.”
Mr Das said the second reason for the alteration in his recommendations was because of the wishes of the children, that they wanted to spend more time with their father, particularly [X]. Mr Das was of the opinion that the quality of the relationship between the children and their father would be increased with the children being able to spend a little more time with him.
The third reason Mr Das was recommending more time was that the husband had advised him that his work schedule would be different in 2009 from 2008, and that the only difficulty he would have was when he was in Melbourne on the Tuesday evening.
Mr Das’ final reason for the change in his recommendations was the quality of the relationship that the husband has with his children. It was Mr Das’ evidence:
“What differentiates this father from a fair majority of fathers that I see is that this father has a very high quality of relationship with his children… One only has to observe them in the company of each other to see that.”
Best interests of the child
Part VII of the Family Law Act 1975 (“the Act”) deals with children. Section 60B of the Act sets out the objects and underlying principles of Part VII of the Act as follows (omitting for present purposes s.60B(3) which deals with Aboriginals and Torres Strait Islanders):
1.The objects of this Part are to ensure that the best interests of children are met by:
(a)ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child; and
(b)protecting children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence; and
(c)ensuring that children receive adequate and proper parenting to help them achieve their full potential; and
(d)ensuring that parents fulfil their duties, and meet their responsibilities, concerning the care, welfare and development of their children.
2.The principles underlying these objects are that (except when it is or would be contrary to a child’s best interests):
(a)children have the right to know and be cared for by both their parents, regardless of whether their parents are married, separated, have never married or have never lived together; and
(b)children have a right to spend time on a regular basis with, and communicate on a regular basis with, both their parents and other people significant to their care, welfare and development (such as grandparents and other relatives); and
(c)parents jointly share duties and responsibilities concerning the care, welfare and development of their children; and
(d)parents should agree about the future parenting of their children; and
(e)children have a right to enjoy their culture (including the right to enjoy that culture with other people who share that culture).
Section 60ca of the Act provides that:
In deciding whether to make a particular parenting order in relation to a child, a court must regard the best interests of the child as the paramount consideration.
In this case, both parties agree that they should have equal shared parental responsibility for the children. Whilst there is no doubt that the parties do have difficulty in communicating and the wife has made allegations, denied by the husband, of instances of domestic violence in that she claims when inebriated the husband became threatening and pushed her out of the marital bed, I am satisfied that such an order for equal shared parental responsibility should be made in this matter.
Where the parents have equal joint parental responsibility for a child, s.65daa of the Act requires the court to consider the child spending equal time, or a substantial and significant time, with each parent.
It provides as follows:1.If a parenting order provides (or is to provide) that a child’s parents are to have equal shared parental responsibility for the child, the court must:
(a)consider whether the child spending equal time with each of the parents would be in the best interests of the child; and
(b)consider whether the child spending equal time with each of the parents is reasonably practicable; and
(c)if it is, consider making an order to provide (or including a provision in the order) for the child to spend equal time with each of the parents.
Sections 65daa (2) and (3) of the Act provide as follows:
2.If:
(a)a parenting order provides (or is to provide) that a child’s parents are to have equal shared parental responsibility for the child; and
(b) the court does not make an order (or include a provision in the order) for the child to spend equal time with each of the parents;
the court must:
(c)consider whether the child spending substantial and significant time with each of the parents would be in the best interests of the child; and
(d)consider whether the child spending substantial and significant time with each of the parents is reasonably practicable; and
(e)if it is, consider making an order to provide (or including a provision in the order) for the child to spend substantial and significant time with each of the parents.
3.For the purposes of subsection (2), a child will be taken to spend substantial and significant time with a parent only if:
(a) the time the child spends with the parent includes both:
(i) days that fall on weekends and holidays; and
(ii) days that do not fall on weekends or holidays; and
(b)the time the child spends with the parent allows the parent to be involved in:
(i) the child’s daily routine; and
(ii) occasions and events that are of particular significance to the child; and
(c)the time the child spends with the parent allows the child to be involved in occasions and events that are of special significance to the parent.
Section 65daa (5) of the Act provides as follows:
5.In determining for the purposes of subsections (1) and (2) whether it is reasonably practicable for a child to spend equal time, or substantial and significant time, with each of the child’s parents, the court must have regard to:
(a)how far apart the parents live from each other; and
(b)the parents’ current and future capacity to implement an arrangement for the child spending equal time, or substantial and significant time, with each of the parents; and
(c)the parents’ current and future capacity to communicate with each other and resolve difficulties that might arise in implementing an arrangement of that kind; and
(d)the impact that an arrangement of that kind would have on the child; and
(e)such other matters as the court considers relevant.
It’s the husband’s application that the children spend equal time with each of the parties, as it was his contention that would be in their best interests.
The wife’s proposal that the children spend alternate weekends with the husband is such that they would spend neither equal nor substantial and significant time with their father. It was her argument that it was not reasonably practicable for the children to spend equal time or substantial and significant time with each of the child’s parents due to their current and future incapacity to communicate with each other and resolve difficulties that might arise in implementing an arrangement of that kind. Particular reference was made to section 65daa (5)(c) of the Act as set out above.
In the note to subsection 65daa (5), it states:
“Behaviour of a parent that is relevant for paragraph (c) may also be taken into account in determining what parenting order the court should make in the best interests of the child. Subsection 60CC(3) provides for considerations that are taken into account in determining what is in the best interests of the child. These include:
(a)the willingness and ability of each of the child’s parents to facilitate, and encourage, a close and continuing relationship between the child and the other parent (paragraph 60CC(3)(c)); and
(b)the attitude to the child, and the responsibilities of parenthood demonstrated by each of the child’s parents (paragraph 60CC(3)(i)).
When determining the arrangements that should be put in place for children, whether it be equal time, significant and substantial time or some other arrangement, the best interests of the children are paramount.
When determining what is in the children’s best interests, the court must consider the matters set out in section 60cc(2) and (3) of the Act. Each of the matters contained in the subsections must be considered and assessed in the context of each of the parties’ behaviours and proposals and a decision made as to which party’s proposal, or such other proposal as the court determines, best meets the children’s best interests.
Section 60cc(2) of the Act sets out the primary considerations which the court must take into account when determining best interests and they are as follows:
Section 60cc 2(a) the benefit to the child of having a meaningful relationship with both of the child’s parents
Section 60cc 2(b) the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence
Neither party makes an allegation against the other that the children are, have been or would be at risk from physical or psychological harm, or be subjected to or exposed to abuse, neglect or family violence whilst in the care of either of them.
It is also common ground between the parties that the children have a close, loving and meaningful relationship with both of their parents.
The issue for the court is what arrangements into the future will best ensure that this close and meaningful relationship that the children have with their parents is best nurtured and allowed to develop and continue into the future.
Section 60cc (3) of the Act sets out the additional considerations to be taken into account and I will consider these in turn.
Section 60cc 3(a) any views expressed by the child and any factors (such as the child’s maturity or level of understanding) that the court thinks are relevant to the weight it should give to the child’s views
As indicated previously in this judgment, both children have indicated that they want to spend more time with their father.
[X] told Mr Das that he found the current arrangements difficult and that he was unable to get into any kind of routine.
In Mr Das’ second report at paragraph 29, he states:
“[X] described (the current arrangement) as being ‘a bit choppy’. Asked to elaborate, [X] stated that the current arrangement made it a bit difficult to get into a regular routine, and not being exactly sure what was happening in terms of who was picking him up from school. [X] stated that it would be easier if he could spend ‘a longer time’ with each parent eg. one week. The writer asked whether he meant ‘a week-about’? [X] replied in the affirmative, stating he would not have to worry about being ‘here or there’. [X] believes that this arrangement would be better than the current arrangement. He did not feel that the current arrangement ie. each alternate weekend, with mid-week contact, allowed enough time to be spent with his father.”
[Y] similarly indicated to Mr Das that she too wanted a week-about arrangement. In paragraph 33 of his second report, Mr Das reports:
“[Y] stated that ‘I’d rather have a week with one and a week with the other (parent)’. [Y] could not give a reason why she preferred this option. When asked if she had talked to her parents about this, her response was that she had talked about it with her father, but not with her mother. [Y] was aware that this proposed arrangement would please her father, but wasn’t sure in relation to her mother.”
Mr Das was cross-examined as to whether he was of the view that the children were too young to understand what ‘week-about’ meant or the ramifications for them if such an arrangement was put in place. It was Mr Das’ evidence as follows:
“I don’t think they’re too young, though, to have an emotional opinion, to express an emotional opinion, of actually wanting to spend more time with their father. With a lot of kids around this age, a lot of kids sort of go the side that they just want to be just to either parent so they want to spend equal time with each parent; they’ll tell you that just because they want to be just. But in this case, I believe that it is a little more than the kids wanting to be just to either parent. I believe it is actually, these kids are mature enough to have a genuine appreciation of what their needs are, of what they actually want. I don’t think they’re saying this just in fairness to the parents.”
I am satisfied that [X] and [Y] genuinely want to spend more time with their father than the current arrangements allow, and that they want this to be in a block of time, rather than there being multiple changeovers in each fortnight.
I am also satisfied that the children’s ages and level of maturity are such that considerable weight should be given to their expressed wishes.
Section 60cc 3(b) the nature of the relationship of the child with:
(i) each of the child’s parents; and
(ii) other persons (including any grandparent or other relative of the child)
Both parents agree that [X] and [Y] have a close and loving relationship with both of them.
I also accept that the wife has been the children’s primary carer, and that she is the one who has put her artistic career on the back-burner to provide the day-to-day practical care for the children.
Neither party placed any evidence before the court about the children’s relationship with extended family members, though it would appear that both parties have siblings with whom the children have regular contact.
Neither party has re-partnered.
Section 60cc 3(c) the willingness and ability of each of the child’s parents to facilitate, and encourage, a close and continuing relationship between the child and the other parent
In considering this factor, the court must also take into account sub-s.60CC(4) and (4A) which provide as follows:
4.Without limiting paragraphs (3)(c) and (i), the court must consider the extent to which each of the child’s parents has fulfilled, or failed to fulfil, his or her responsibilities as a parent and, in particular, the extent to which each of the child’s parents:
(a) has taken, or failed to take, the opportunity:
(i) to participate in making decisions about major long term issues in relation to the child; and
(ii) to spend time with the child; and
(iii) to communicate with the child; and
(b) has facilitated, or failed to facilitate, the other parent:
(i) participating in making decisions about major long term issues in relation to the child; and
(ii) spending time with the child; and
(iii) communicating with the child; and
(c)has fulfilled, or failed to fulfil, the parent’s obligation to maintain the child.
4A.If the child’s parents have separated, the court must, in applying subsection (4), have regard, in particular, to events that have happened, and circumstances that have existed, since the separation occurred.
Both parents have, to some extent, facilitated and encouraged the children to have a close and continuing relationship with the other parent. In their evidence, they acknowledged that the other was a good parent and the strength of the relationship the children have with that other parent.
What was of concern was their acknowledged inability to communicate with each other.
In his evidence, Mr Das referred to the ongoing emotional enmeshment between the parties which continues to this day, despite them having been separated for nearly three years.
Mr Das was in agreement that their continued physical proximity, that is, they have continued to live within 100 metres of each other since they separated, has enhanced this ongoing emotional enmeshment.
It was my observation of the parties, whilst giving their evidence, that both of them were still very much emotionally entangled with each other, and that many of the issues surrounding their separation have not been resolved.
Mr Das was specifically asked whether he thought there was potential for an improvement in their ability to focus on communications as parents when property matters were finalised between them and they ceased to live in such close physical proximity. It was his evidence that he would expect an improvement in communication with a little bit of distance, both emotionally and physically.
Mr Das was critical of both the parties for what he perceived to be them placing the children in a secondary position to their stated desire to retain the matrimonial home. He was very critical of both of them for not placing the needs of the children first and moving away to provide that space, and thus to reduce the level of conflict that the children were exposed to.
At the same time, it must be noted however, that between the first and second family reports, the children observed a marked cessation of hostilities between the parties, and therefore some credit must be given to them for shielding the children from their ongoing unhappiness with each other.
Mr Das was also asked how he thought a shared care arrangement could work in circumstances where the parties were so obviously unable to communicate or cooperate with each other in relation to arrangements for the children. Mr Das expressed the view that a shared care arrangement could potentially lead to less conflict than a situation where the husband was seeing the children each alternate weekend and then seeing the children during the week. It was his view that with a clear established pattern and routine, the potential for conflict between the parties would be minimised. It would also meet [X]’s expressed wish for less “chopping and changing”.
Section 60cc 3(d) the likely effect of any changes in the child’s circumstances, including the likely effect on the child of any separation from:
(i) either of his or her parents; or
(ii) any other child, or other person (including any grandparent or other relative of the child), with whom he or she has been living
It is the express wish of both parties to remain in the former matrimonial home.
Whichever way property matters are resolved, it was the evidence of both parties that they would ideally remain in the [H] area. The children are very clear that they wish to remain in the area so that they can continue their school and friendship groups.
I am satisfied that the parties will put in place arrangements for the children that will not impact on the children’s ability to spend time with either of the parties or their involvement in their current schools and extra-curricular activities.
Section 60cc 3(e) the practical difficulty and expense of a child spending time with and communicating with a parent and whether that difficulty or expense will substantially affect the child’s right to maintain personal relations and direct contact with both parents on a regular basis
The major practical difficulty in relation to the husband’s proposal for equal time with the children is his work commitments in Melbourne every Tuesday and Wednesday. This requires him to stay in Melbourne overnight each Tuesday during the teaching terms.
In his discussions with Mr Das for the preparation of the second family report, it was the husband’s proposal that during the teaching term semesters, the children would stay with their mother on Tuesday night.
There were also concerns raised on the impact of Mr Jennings’ artistic career and it’s requirements on his ability to be there for the children. In particular, concerns were raised as to him having to use city-based studios and facilities in the preparation of his large commissioned statues, the necessity for him to attend exhibitions, the necessity for him to self-promote and the need for him to be working in the studio when he needed to be there to look after the children.
There were numerous examples during the marriage of the husband being absent for sometimes quite considerable periods in the pursuit of his professional career. Even since separation, the husband was unable to see the children on Thursday evenings because of his commitments to his teaching role at [L] University in Bendigo in 2008.
Mr Das, in his second report, made it quite clear that his recommendation for equal time was conditional upon the husband being able to satisfy the court that he was able to adjust his work commitments to be available to care for the children in accordance with the arrangements that had been put in place.
The husband’s evidence was that he could and would adjust his working arrangements to meet his commitments to care for the children. I am satisfied that he can and will do this.
Having said that, this does not mean that there won’t be occasions when both the parties won’t have to make alternate arrangements for the children because they have other commitments in their adult lives. It would become an issue however, if this was something that became the rule rather than the exception.
Section 60cc 3(f) the capacity of:
(i) each of the child’s parents; and
(ii) any other person (including any grandparent or other relative of the child);
to provide for the needs of the child, including emotional and intellectual needs
Both parents have the capacity to provide well for the children’s physical, intellectual and emotional needs and generally speaking have done so to date.
As noted earlier in this judgment, Mr Das was critical of the parents for not shielding the children from their ongoing conflict and for placing their desire to keep the matrimonial property ahead of the children’s needs.
However, to their credit, they seem to have shielded the children from their ongoing conflict in more recent times and both parents expressed a desire to move forward with less acrimony.
It was my observation that the parents continue to be emotionally enmeshed with each other and that until there is a real separation, not only emotionally but physically, it is going to be difficult for either of them to move to the next stage in their lives and to focus on their role as parents, rather than as a separated couple.
They might both be assisted in this process by some personal counselling.
Section 60cc 3(g) the maturity, sex, lifestyle and background (including lifestyle, culture and traditions) of the child and of either of the child’s parents, and any other characteristics of the child that the court thinks are relevant
Both parties are professional artists. Whilst the wife has, to some extent, placed her career on the back-burner whilst the children were growing, I accept her evidence that it is her desire to become more actively engaged in her artistic pursuits. The reality of this is that there will be times when both parties will have to balance the demands of their professional career with the needs of their children.
During his evidence, Mr Das made some reference to the parties having something of a “bohemian lifestyle”. Whilst I am not sure about that, in all probability, the life of a working artist is different to that of someone who has a mainstream 9.00 am to 5.00 pm job. However, both these children have grown up with working artists, and have happily spent time with both their parents whilst they were working on their artistic endeavours.
I don’t believe that the fact the parties are artists impacts in any way on their ability to properly care for their children.
Section 60cc 3(h) if the child is an Aboriginal child or a Torres Strait Islander child:
(i) the child’s right to enjoy his or her Aboriginal or Torres Strait Islander culture (including the right to enjoy that culture with other people who share that culture); and
(ii) the likely impact any proposed parenting order under this Part will have on that right;
Not relevant.
Section 60cc 3(i) the attitude to the child, and to the responsibilities of parenthood, demonstrated by each of the child’s parents
This judgment has already touched on, at some length, the behaviours of both the parents towards each other and the negative impact this has had on their ability to parent their children as well as they might.
It is unfortunate that, for whatever reasons, this matter has taken some two years to reach conclusion in the court system. They and the children have been let down by this and it can only be hoped that with the finalisation of proceedings, they will be able to move on with their lives.
However, it should be noted that [X] and [Y] are, by all reports, delightful young people who are doing very well both at school and socially, and this can only be the reflection of some very positive parenting.
Section 60cc 3(j) any family violence involving the child or a member of the child’s family
The wife has made allegations that there were several occasions when the husband was physically and verbally abusive towards her during the marriage, especially when he was affected by alcohol. This is strenuously denied by the husband.
I am unable to make any findings as to whether these incidents did occur, but am satisfied there are no issues of violence as between the parties at this time.
Section 60cc 3(k) any family violence order that applies to the child or a member of the child’s family, if:
(i) the order is a final order; or
(ii) the making of the order was contested by a person
Not relevant.
Section 60cc 3(l) whether it would be preferable to make the order that would be least likely to lead to the institution of further proceedings in relation to the child
It is difficult to assess whether any particular orders are less likely to lead to the institution of further proceedings between the parties.
It is hoped that with the finalisation of these proceedings and the physical separation of the parties, the level of animosity between them will be measurably reduced and they will be better able to co-parent.
Section 60cc 3(m) any other fact or circumstance that the court thinks is relevant
The wife raised concerns about the husband’s consumption of alcohol, use of marijuana and its potential to impact on his ability to care for the children.
Mr Das noted in his report and in his evidence that when he questioned the wife in relation to these concerns, she was unable to give instances in recent times, and particularly since separation when she had observed the husband to be affected by either alcohol or marijuana.
I am satisfied that the husband does not have an issue with excessive alcohol consumption or the use of marijuana or that it impacts on his ability to care for the children.
Whilst the parties were in agreement that there should be a sharing of school holidays and special occasions such as Christmas, birthdays, Mother’s Day, Father’s Day and Easter, the minute of their proposals somewhat differed, neither party sought to adduce any evidence in relation to those arrangements, nor were they addressed in the parties’ submissions either when they opened their case or closed their case. In these circumstances I have done my best to make orders that I believe best meet the needs of the children.
Conclusion
By all reports, [X] and [Y] are delightful and intelligent children, who have a close and loving relationship with both their mother and father. Both have expressed dissatisfaction with the current arrangements that are in place for their care, in that it is too “choppy” and does not afford them enough time with their father.
Whilst the parties separated in July 2006, they have continued to live within 100 metres of each other since that time. Because of this, they remain intensely emotionally enmeshed, and they have not been able to develop any form of sensible communication or strategies for cooperative parenting.
The wife is concerned that the husband’s commitments as a working artist and his professional commitments teaching art will take precedence over his commitments to care for the children and that because of this, a shared care arrangement would not be in the children’s best interests.
I am satisfied that the husband is committed to putting his work arrangements in place in a manner that will enable him to properly care for the children. This is evidenced by him re-arranging his commitments with [L] University in Bendigo so that he only works one day per fortnight, rather than two days.
However, the husband has had a commitment at [C] in Melbourne to work every Tuesday and Wednesday for in excess of ten years now, and I am satisfied that this commitment will continue into the future. I am also satisfied that this will require him to remain in Melbourne every Tuesday night. It also involves him returning from Melbourne late on Wednesday evening. Whilst he gave evidence he could arrange to finish at 3.30 pm each Wednesday, he has not done this to date. The husband’s proposal that the children spend the Tuesday night with their mother during “his week” with the children and go to friends until he gets home on Wednesday is not practical. This involves the chopping and changing that both [X] and [Y] indicated they found unsettling to themselves and their routine.
For this reason, I find that an equal time arrangement is not practical.
However, the wife’s proposal that the husband’s time with the children should only take place on alternate weekends is also not in their best interests. The children want additional time with their father and it is quite apparent that their close and ongoing relationship will be damaged if their time with their father was limited to only every second weekend.
In these circumstances, I am of the view that it is in the children’s best interests that they live with their father in a block period of five nights each fortnight from after school Thursday to before school Tuesday, and that they otherwise live with their mother. This should occur in the week the husband is not working in Bendigo.
It will be very important for [X] and [Y] that their parents work hard to address their issues as between each other and develop a much better way to communicate with each other about their children. The parents must consult each other in relation to the arrangements for their children, and in particular, the children’s extra-curricular activities. Leading on from this, both parents must ensure that they enable the children to attend their extra-curricular activities when they are in their care.
PROPERTY MATTERS
Much of the parties’ history is set out in great detail earlier in this judgment and it is not my intent to repeat them under this heading.
The parties’ assets can be broken down into two categories. The first is comprised of what can perhaps be described as the “usual assets”, being the former matrimonial home, furniture and chattels, motor vehicles and superannuation. The second category comprises an extensive art collection, made up largely of the works of art produced by the husband, a smaller number of works completed by the wife and a small number of the works of other artists. In addition, there is a list of rare books, collectibles, presses, tools and equipment.
These latter items were identified by the parties and a sworn valuation of same was prepared by Mr L. That valuation was sworn on
22 September 2007and filed in this court on 30 June 2008. That valuation was accepted by the parties. Hereafter in this judgment, the items and collectibles in that list will be referred to as the “Mr L list”.
It is my intention in this judgment to specifically address the two categories of the parties’ assets.
Art works/Mr L list
The parties were in agreement that the art work and the Mr L list was to be divided between them in specie.
Beyond that however, the parties were unable to agree. The issues in relation to the artwork and the Mr L list can be best identified as follows:
1.What is the value of the artwork?
2.How is the artwork to be divided between the husband and wife, and in what proportion?
3.How are the items on the Mr L list to be divided between the parties, and in what proportion?
4.What are the tax implications of any transfer of artworks deemed to be the husband’s “trading stock” to the wife and who should be responsible for the payment of same?
The value of the artwork
On behalf of the wife, Mr T, a consultant writer and valuer of artworks and the proprietor of Mr T Fine Arts, prepared a valuation of the parties’ artworks. Mr T swore an affidavit on 2 July 2008 and it was filed with the court on 3 July 2008. He valued the artworks at approximately $1,420,000.00.
Subsequent to the preparation of the valuation by Mr T, the husband prepared a detailed document, in which he individually listed each of the artworks that had been valued by title, date of creation, medium, dimension, quantity and the value ascribed to that item by Mr T. Each of the works of art were given a number and there were 911 works in all. This document is headed “Complete list of artworks in possession of Mr Jennings and Ms Canon” and was filed by him on
4 September 2008. All parties accepted that this was an accurate list of the parties’ artworks, and this was used as a reference by the parties and the court thereafter. This list will be utilised hereafter in this judgment and in the orders being made by this court.
The husband filed an affidavit on 13 November 2008 of Mr P, gallery director. Mr P is the husband’s agent and in his affidavit he stated that:
“I defy anybody to actually sell Mr Jennings’ collected works as listed for more than a total of $150,000.00 in a limited time frame.”
When this matter came before me for final hearing in November 2008, it was agreed that the matter was unable to proceed at that time because of the huge discrepancy of the parties’ respective experts in relation to the value of the artwork and the need to adduce further evidence on that issue.
On that occasion, I made orders for Mr T and Mr P to consult, and for them to provide a joint report.
At the commencement of the final hearing, I directed that Mr T and
Mr P give their evidence jointly so that they would have the opportunity to hear the evidence of the other and to comment on, or respond to same.
In determining this matter, I was greatly assisted by the decision of Rowlands J in the matter of In the Marriage of Whitely [1992] FLC 92-304. That matter related to the artist, Brett Whitely.
His Honour was required to determine the value of Mr Whitely’s artwork. The parties’ valuers disagreed. When considering the evidence of the valuers, His Honour noted that one of the valuers, a Ms Brady, made it clear that her selling campaign would be over a period of years and that anything less would require a discount.
His Honour stated at page 79,295:
“I am concerned with the present market for the works. It is now and at their present value that they change hands. Certainly ordering marketing over a period of months might be considered appropriate. A campaign stretching over half a decade does not appear to me to meet the criteria for a present valuation of the relevant property.”
His Honour then proceeded to apply a reduction to the valuation of the artworks because of this.
Mr T and Mr P gave sworn evidence before the court on 25 March 2009. They produced a brief joint report, in which Mr P indicated that he considered that if Mr Jennings’ work was placed on the market today, it would be less than likely to even receive ten percent of the overall valuation placed on it by Mr T.
Mr P indicated that ideally Mr Jennings’ work should be sold through the normal course of commercial gallery business, and that an exhibition in the range of every two years along with sales of work held in stock between those exhibitions would be ideal. He noted that Mr Jennings does not have a consistent proven market, and therefore occasional sales from stock and moderate success from the next few exhibitions would be the best one could count on.
Mr T drew attention to that part of his original report of 7 November 2007, in which he stated:
“Valuations have been provided in terms of their considered market value. It must be emphasised, however, that were all these works of art required to be offered for sale at the one time, the market would be swamped and their values would plummet. Moreover, it is likely that many would remain unsold. Any effective realisation would necessarily take place over a period of time, involving a range of complex factors and costs such as dealer commissions, advertising, and related promotional expenses.”
Mr T also noted that the art market had changed considerably over the last twelve months due to the global financial crisis, and it was his estimation, confirmed not only in his report but in his oral evidence, that there had been a drop of between thirty to fifty percent in both the general and art auction markets.
Mr P indicated that he considered a ninety percent reduction of the November 2007 values would be more realistic in the present market, though he was of the view it might be possible to obtain fifty percent of the 2007 figures if the works were sold over time. He also confirmed that the selling agent receives a forty percent commission on any work sold by that agent on behalf of an artist.
It was explained to Mr T and Mr P that, for the purposes of valuing the artwork for the current proceedings, that valuation would be set at its current market value, and not at the values the work may obtain if sold over several years.
It was the evidence of both Mr T and Mr P that in those circumstances, they were in agreement that the current market value of the artwork is ten percent of the figures attributable to those pieces of art in the valuation prepared by Mr T in November 2007.
Further, Mr T and Mr P agreed that this value was attributable to all the artworks contained in the valuation, not just those artworks created by Mr Jennings.
Accordingly, I find that the value of the artworks is a figure that represents ten percent of the value attributable to them in the valuation prepared by Mr T.
Division of artwork and Mr L list items
Both parties agreed that there were a number of items on both the List of Artworks and the Mr L list that had been owned by them prior to the commencement of cohabitation. (I note that the parties agree that cohabitation commenced on 30 May 1987, when the wife joined the husband in the United States of America.)
It was agreed that those artworks and the Mr L items owned by each of the respective parties prior to the commencement of cohabitation were to remain the property of the party who owned them prior to the commencement of cohabitation.
At my request, the parties prepared a list of those items they believed were owned by them prior to cohabitation.
The husband took no issue with the list prepared by the wife and I have made orders declaring her the sole owner of same.
In relation to the husband’s list, there were five items on the Mr L list to which the wife took objection. The husband was given the opportunity to produce to the court independent evidence verifying his ownership of those items prior to cohabitation. He was unable to do so, and in those circumstances, I rule that those five items stay on the list for division between the parties. The remaining items agreed to be those of the husband’s have resulted in an order declaring them to be his sole property.
In relation to the artwork, the wife took issue with thirteen items that were claimed by the husband to have been owned by him. Of those items in dispute, items 40, 42, 554-569 were all acquired in 1987, and I find that they should remain on the list for division between the parties.
Items 155-159 and item 205 are prints that the husband gave evidence he purchased in the 1970’s and early 1980’s. I am satisfied that they are items owned by him prior to the commencement of cohabitation.
I have made orders that declare the husband the owner of the items that were agreed were owned by him prior to cohabitation, together with the six additional items found by me to be his prior to the commencement of cohabitation.
The parties also agreed that the large sculpture entitled “[W]” was to be sold by them and the proceeds of same utilised for the benefit of the children’s education. I have made orders by consent in those terms.
During the running of the matter, the parties agreed that the approximate 500 reference and other books contained in two wooden bookcases in the matrimonial home, valued by Mr L at $750.00, would be divided between them by agreement. Again, I have made orders by consent in those terms.
Further, during the running of the matter, the parties reached agreement that the chattels and furniture not on the Mr L list in the house on the matrimonial property would be retained by the wife. I have made an order by consent in those terms.
The parties also agreed that the chattels and furniture not on the Mr L list in the studio on the matrimonial property would be retained by the husband. Again, I have made orders by consent in those terms.
Neither party made submissions to the court as to the manner in which the division between the parties of the artworks and Mr L list items should take place, or as to what percentage of that artwork each should retain. Having said that, the husband suggested that where an item consisted of a number of copies of a print that they should agree to take half each. This was not agreed to by the wife and I do not propose to make orders in those terms. This does not however prevent them from agreeing to do that at some time in the future.
Approximately 60 percent of the parties’ artworks are those created by the husband and approximately 10 percent of their artworks were created by the wife.
It is common ground between the parties that the wife’s artistic career took a backseat when the children were born, and that she assumed their primary care, thus freeing up the husband to continue to pursue his artistic career.
It was also the wife’s evidence, which I accept, that she actively supported the husband’s artistic career by searching out appropriate commissions and grants, and then preparing all the necessary written submissions and paperwork to enable him to successfully bid for those works. She also helped him complete his Masters by assisting him with the typing of his thesis.
In all the circumstances, I am satisfied that the artworks and collectibles should be divided equally between the parties so that they each receive artworks and Mr L items that represent them retaining
50 percent of the value of those combined works and items.
During the running of the trial, I directed the parties to prepare a list of the first twenty items of artwork they wished to retain and a list of the first ten Mr L list items that they wished to retain.
Those lists were produced on the final day of trial. In relation to the Mr L list, both parties sought that they retain the oxy acetylene equipment. The husband agreed that the wife could retain same. The wife’s Mr L list included the bookshelves of books which were subsequently agreed to be divided equally between them. In those circumstances, each party nominated an additional item. I have made orders that the parties retain those items and that they otherwise take turn about in picking items until such time as they retain items that reflect them each having 50 percent of the value of the items on the list.
In relation to the artworks, the parties produced their lists, and on each list, both parties had chosen four of the same items. Of those four items, I have determined that the husband will retain items 148 and 267, and the wife will retain items 269 and 887. I have made orders reflecting that the parties retain those items selected by them, in addition to those additional items referred to, and that otherwise they each choose 50 items in turn until such time as the art on the list has been divided between them so that they each retain artwork equivalent to fifty percent of the value of that artwork.
Tax implications of any artwork deemed to be “trading stock”
The husband filed an affidavit on 26 September 2008, prepared by
Mr B, who is a Chartered Accountant and Managing Partner of [B] Accountants and Financial Advisors. Mr B confirmed the contents of his affidavit and clarified same in oral evidence given to the court during the running of the trial.
In his affidavit, Mr B stated:
“The tax payable on the proceeds from the sale of works of art depends on whether the particular works are considered to be works best described as forming part of the artist’s “personal collection” or whether they are considered to be “trading stock”.
The distinction between the two varieties of works for tax purposes can be controversial. Commissioned works are invariably considered to be trading stock, as are works produced for a particular exhibition or sale. Works produced out of inspiration or without a particular purpose are best classified as personal collection.
Income from sales of trading stock form part of a working artist’s income and are therefore subject to income tax at the usual marginal rate when the individual’s tax return is completed each year. The disposal of such works by the artist is the event that triggers the tax liability.
The sale of work from an artist’s personal collection does not attract income tax liability however does attract Capital Gains Tax liability. Capital Gains Tax is not payable if the particular work costs less than $500 to produce. The sale of such works therefore does not attract any tax liability. If a work from an artist’s personal collection costs more than $500, Capital Gains Tax is incurred.
In this current case, I have seen the list of artworks in dispute, which I understand has been filed with the Court. The tax implications of the transfer of those works to the Wife or the sale of these works differ if the works are trading stock or personal collection.
If the piece in question is considered to be part of Mr Jennings’ personal collection, income tax will not be payable by either the wife or the husband. If the work cost more than $500 to produce, whoever ultimately sells the work would be liable for Capital Gains Tax upon disposing of it, given the rollover relief available to those receiving property pursuant to Family Court proceedings.
If work received by the Wife is properly considered to be part of Mr Jennings’ trading stock, this would not have any tax consequences for her upon the work being sold. However, the transfer of the work to her pursuant to any Court Order or agreement would have income tax consequences for Mr Jennings. His transfer of the work to the wife would be viewed by the Australian Tax Office as a disposal outside the ordinary course of business and he would therefore be taxed as if he had received the market value of the trading stock.”
Mr B’s evidence was accepted as accurately reflecting the current tax implications for the transfer and/or sale of artistic works.
In the event that the wife has transferred to her artworks of the husband that are deemed to be “trading stock” for taxation purposes, I have made orders that any taxation liability arising to the husband because of that transfer will be paid by the husband and wife in the same proportion as the division of the artworks – ie. that they will each be responsible to pay one half of any such taxation liability.
I have not made such an order in relation to any transfer of the wife’s artworks to the husband as he indicated in the running of the case that he would not be seeking to retain any artworks produced by her.
Matrimonial property
The issues between the parties in relation to the remaining matrimonial property I have identified as follows:
1.What comprises the remaining matrimonial property pool and in particular:
(a)what is the value of the former matrimonial home?;
(b)should monies in the Bendigo Bank of $26,886.00 and the Commonwealth Bank of $20,156.00 retained by the husband at separation be “added back” to the property pool?;
(c)should the tax returns for the financial year of 2005/2006 of the husband in the sum of $6,658.00 and the wife in the sum of $581.00 retained by both of them be “added back” to the property pool?;
(d)should the value of the art work “[P]” donated by the husband to the McClelland Gallery as part of the Cultural Gifts Program be “added back” to the pool; and if so, what value should be given to it?;
(e)should the three small items of art work donated by the husband to the Kyneton Council, MAD Gallery Mansfield and the children’s school be “added back” to the pool, and if so, what value should be given to them?; and
(f)should the net income received by the husband for works completed by him after separation but commissioned prior to separation being “[O]”, “[R]” and “[H]” be “added back” to the pool?
2.Should there be an adjustment as between the parties arising from an assessment of their respective contributions and section 75(2) factors?
3.Who shall retain the former matrimonial home as both parties wish to do so?
The legislation
Section 79 of the Family Law Act1975 (“the Act”) defines the Court’s powers in determining applications for property settlement. Sub-section 79(2) of the Act provides that:
The Court shall not make an Order under this Section unless it is satisfied that, in all the circumstances, it is just and equitable to make the Order.
Section 79(4) of the Act sets out the matters the Court must take into account when considering what orders should be made for the alteration of the interest of the parties in property. Those matters are:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
The four-step approach
In Hickey and Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143 at [39], the Full Court of the Family Court described the preferred four-step approach in property matters as follows:
The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of s.79. That approach involves four inter-related steps. Firstly, the Court should make findings as to 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), ("the other factors") 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 ….
Assets and liabilities
Value of former matrimonial home
When this matter came before me in November 2008, the wife relied on a sworn valuation from Mr M, property valuer from BMT Property Valuers, in which the former matrimonial home at Property N, was valued at $450,000.00.
The husband relied on the valuation of Mr D, Property Valuer of [W] Property Group, sworn on 10 November 2008, which valued the property at $375,000.00.
I made orders in November 2008 that the valuers confer and provide a joint report for the hearing of the matter in March 2009.
On the first day of the hearing of the matter before me in March 2009, Counsel for the wife advised that there had been written exchanges between his instructors and the husband, in which they had agreed that for the purposes of the conduct of the hearing, the value of the matrimonial home would be agreed at $412,500.00.
However, I was advised that prior to the commencement of court that morning, the husband had withdrawn from that agreement and that in those circumstances, the issue of the value of the former matrimonial home remained live.
I therefore directed that the parties’ valuers were to confer by no later than close of business on the third day of the trial, and if they were unable to reach agreement, they were to attend court on the morning of the fifth day of the trial to give their evidence so that a determination of the value of the matrimonial home could be made.
On the morning of the fifth day of the hearing, the court was advised that the husband’s valuer would not be attending court to give evidence, and further he had not returned the calls of the wife’s valuer, Mr M.
Mr M was at court and placed into evidence his reviewed sworn valuation dated 25 March 2009. It was his evidence that the value of the former matrimonial home remained at $450,000.00.
He said this valuation was based on recent sales and made particular reference to a property at Property C, a very similar property to that of the parties, which was sold on the basis of the land being valued at $16.00 per square metre.
His evidence was that based on those recent sales, he had adopted an amount of $15.00 per square metre as the basis for his valuation. It was his evidence that the husband’s valuer, Mr D, had adopted a value of $13.00 per square metre, and that this was the basis for the differences in their respective valuations.
Mr M gave evidence that he had spoken to Mr D two days ago and enquired of him the basis upon which he was using the lower rate of valuation, particularly in light of recent sales such as the Property C property. Mr D had told him he would make further enquiries and get back to him. It was Mr M’s evidence that he had not had any further conversations with Mr D, despite trying to contact him on a number of occasions before coming to court.
In all these circumstances, I am satisfied that the valuation prepared by Mr M accurately reflects the proper value of the former matrimonial home and I find same to be $450,000.00.
The costs incurred by the wife as a result of the husband’s actions in relation to this issue will be dealt with later in this judgment.
“Add-backs”
It was argued on behalf of the wife that there were a number of items that should be “added back” into the property pool.
It was common ground that at the date of separation, the husband retained the benefit of the $26,886.00 contained in an account with the Bendigo Bank and the sum of $20,156.00 contained in an account with the Commonwealth Bank of Australia. Those monies will be added back to the property pool.
It is also common ground that from those funds, the husband purchased a Mazda motor vehicle, which he has retained the benefit of. It was agreed that this vehicle should not be included in the pool as it would be a double accounting.
After separation, both parties received income tax rebates for the financial year 2005/2006. The husband produced in evidence documentation that confirmed he received a net amount of $6,658.00 and similarly the wife produced evidence that she received a tax refund of $581.00.
Both those sums will be added back to the property pool.
Pursuant to order 13 of orders made by this Honourable Court on
23 May 2007, the husband paid the wife a lump sum of $15,000.00, which was to be taken into account at the trial as partial property settlement. That amount is added back to the pool.
It is possible for artists to make donations of their works to galleries and other institutions through the Cultural Gifts Program. When this occurs, the artist is able to claim a taxation deduction against the income they otherwise earn for their artistic endeavours based on the valuations of that work, attested by two independent valuations of same.
In 1992, the husband completed a large sculpture called “[P]” for the Jennings Group for some $30,000.00. It was completed and installed at the eastern entrance of Southgate. However in 2000, the sculpture was decommissioned and removed by the owners who intended to relocate the sculpture. As no suitable site could be established for it, the work was returned to the husband.
In 2005, the work was accepted into the Cultural Gifts Program, and was eventually placed with the McClelland Gallery in June 2007.
The valuation certificates for the Cultural Gifts Program provided to the Department of Communications value the works at between $85,000.00 and $90,000.00.
It was submitted on behalf of the wife that as the donation took place after separation and without her consent, this amount should be added back to the pool.
It was conceded by her Counsel in closing that in light of the evidence of the valuers, if such an add-back was to take place, it would perhaps have to reflect an amount that was in accordance with the valuer’s evidence, that is at ten percent of that value.
It was argued on behalf of the husband that the process for the donation to the Cultural Gifts Program had commenced with the consent of the wife prior to separation and that once the process had started it would have been most difficult to stop same.
The husband argued that whilst the piece had been given a value for the purposes of a tax deduction, it was not a work that was marketable and that it’s only real value was as a tax deduction.
The husband argued that this was supported by the evidence of
Mr P and in particular referred to paragraph 10 of the affidavit of Mr P filed on 13 November 2008 which provides:
“As a rule, if an artist could sell a work for the value it is given through the Cultural Gifts Program, or even a proportion of that value, they would sell it rather than donate it. Realistically, such works are either very difficult or impossible to sell. Those who ultimately receive such works via donation would be unlikely to pay the formal valuation price for the works as doing so would be beyond their means. Large experimental pieces, such as [P] in the current proceedings, therefore only really have any benefit to an artist as a tax deduction.”
I am satisfied that the wife had consented to the work being donated through the Cultural Gifts Program prior to the parties separating. I am also satisfied that the value of the work contained in the documents prepared for tax purposes do not reflect in any way the true market value of the piece. I am also satisfied, given the history of the work, that is that it had been in storage for some years before its donation with no one willing to purchase it, and on the evidence of Mr P, that the work was not marketable.
In those circumstances, there will be no add-back in relation to “[P]” being donated to the Cultural Gifts Program.
The husband conceded that after separation he had made three further “small” donations of his art work to the local council, a local gallery and to the children’s school to assist them to raise funds. The value of these works, based on the evidence of Messrs T and P is less than $400.00. The husband obtained no benefit from the donations. In all these circumstances, I do not intend to “add-back” their value to the pool.
At the time that the parties separated, the husband was in the midst of creating a very large commissioned sculpture named “[O]”. It is common ground that in the weeks leading up to separation, the husband had been primarily based in Melbourne working on this piece. The work was completed and finally installed by the husband approximately six months after separation.
The commission schedule in relation to this work shows that the net amount received by the husband after payment of construction and design costs was $43,152.04.
Between February and June 2007, the husband completed a work entitled “[R]”. The commission schedule in relation to this work shows that the net amount received by the husband after construction and design costs was $25,463.06.
Between December 2006 and June 2007, the husband completed a work entitled “[H]”. The commission schedule for that work shows that the net amount received by the husband after payment of construction and design costs was $9,110.00.
All these monies were received by the husband after separation.
It is common ground that the commissions for these works were obtained by the husband prior to separation, and that the wife assisted the husband in obtaining those commissions by preparing all the necessary paperwork associated with same.
It was submitted on behalf of the wife that in these circumstances, those monies should form part of the property pool.
The husband submitted that as these works were wholly designed, created and completed by him after separation save for “[O]” which was in production as at the time of separation, they do not form part of the parties’ joint assets and should not be included in the pool.
I agree with the husband. Whilst I accept that the wife did assist the husband in obtaining these commissions, their design, creation and completion was entirely undertaken by the husband (save for the early part of “[O]”) after separation. The creation and completion of these works of art to the satisfaction of those who commissioned the work rests solely with the husband.
In those circumstances, I do not propose to add-back the sums received by the husband after separation for the works completed by him after separation.
In those circumstances, I find the matrimonial pool consists of the following:
Property N, with a value of $450,000.00, less mortgage to Bendigo Bank of $45,000.00, leaving net equity of $405,000.00 $405,000.00
Monies at separation held with Bendigo Bank $ 26,886.00 Monies at separation held with the Commonwealth Bank of Australia $ 20,156.00 Husband’s taxation rebate $ 6,658.00 Wife’s taxation rebate $ 581.00 Subaru/Camry $ 1,900.00 Monies paid to wife pursuant to court orders $ 15,000.00 Total $476,181.00
I note that both parties have relatively small superannuation entitlements. The husband’s entitlement is $33,530.00 and the wife’s entitlement is $25,587.00. Neither party sought any orders in relation to superannuation, other than each retain their current entitlements. Nor did either party seek that there be an adjustment in relation to the relatively small differential between the parties’ superannuation entitlements.
Contributions
Neither party had any assets of any great significance at the commencement of cohabitation.
In the early stages of their relationship, both were working to establish their artistic careers, and whilst travelling overseas took whatever jobs were available to them to supplement their income.
Upon their return to Australia, the parties continued to pursue their artistic careers and both took various forms of employment to give themselves a financial base from which to pursue their artistic endeavours.
During this period, the parties’ reputations as artists grew, with both of them successfully obtaining commissions for interesting and large pieces of work, particularly sculptures. By way of example, the wife is the artist who created the statues that stand outside this court and reference has been made previously in this judgment to works created by the husband such as “[P]” and “[W]”.
The deposit for the former matrimonial home was achieved through the joint endeavours of the parties. They were able to discharge the mortgage over that property through their joint endeavours in less than ten years.
It is common ground that after the children were born, the wife put her artistic aspirations on the back-burner to assume primary care of the children. This enabled the husband to continue to pursue his artistic career to the fullest.
During this period, both parties held ongoing part-time employment which provided the family with a financially secure base.
It is the wife’s evidence, which I accept, that she supported the husband’s artistic pursuits by assuming the primary carer’s role for the children, by supporting him while he completed his Masters in Fine Arts, including assisting him with any written work (particularly because of his dyslexia) and with the preparation of submissions that enabled him to obtain a large number of important commissions.
During this period, the husband was able to forego the services of a professional agent, thus saving himself the 40 percent commission he would have otherwise had to pay in relation to any works completed and sold by him. I am satisfied that this was in part because of the practical assistance given to him by the wife.
It is quite telling that since separation, the husband has not applied for or obtained any further commissions and has recently re-engaged an agent for the purposes of exhibiting and selling his works.
As noted previously in this judgment, the husband’s output as an artist during the marriage was prolific, and the parties’ financial circumstances were enhanced by his efforts in this regard.
It was submitted on behalf of the wife that in all the circumstances as set out above, the contributions of the parties should be deemed as equal. The husband, who was self-represented, made no specific submissions in relation to the issue of contributions, but in the course of the running of the matter, did not take marked objection to the summary of the wife’s contributions as set out in this judgment.
I accept the submissions as put on behalf of the wife and find that the contributions of the parties to their joint assets during the course of their relationship was equal.
Section 75(2) factors
Both parties are aged in their 40’s and are in good health.
Both parties are in stable, part-time employment. The wife earns $696.00 per week. She completed her qualifications as a teacher last year, and it was her evidence that she was hoping to be able to obtain employment as an art teacher in the future. It was also her evidence that she was hoping to reignite her artistic career into the future.
The husband earns approximately $540.00 per week from his part-time employment at [C], but presented no evidence as to what he is earning from his one day per fortnight at [L] University. Otherwise, he continues to pursue his career as a working artist.
Whilst it is clear that the husband generated significant income in the twelve months after separation, arising from the commissions he had at that time, he currently has no major works commissioned.
It was the evidence of Mr T and Mr P that the global financial crisis had impacted dramatically on the art market, and in those circumstances, it is perhaps difficult to speculate on the earning capacity of either of the parties as working artists in the short to medium term.
The parties have two young children, [X] aged eleven years and [Y] aged eight years, and in accordance with the orders made by me in this matter, they will live with their mother and spend substantial and significant time with their father. I am satisfied that the majority of the financial burden for the care of the children since separation has fallen on the shoulders of the wife. The husband has a nil child support assessment. I am satisfied that this apportionment of financial responsibility will continue into the future, albeit somewhat lessened because of the increased amount of time that the children will spend with their father.
It was submitted on behalf of the wife that in these circumstances, there should be an adjustment in the wife’s favour so that she receives
65 percent of the asset pool and the husband receive 35 percent of the asset pool.
The husband conceded that there should be an adjustment in the wife’s favour, but argued that a figure of between 55 to 60 percent was a more accurate reflection of that adjustment.
Having considered all the factors, I am of the view that there should be an adjustment of ten percent on the asset pool as set out in paragraph 236 of this judgment, in favour of the wife.
Retention of the former matrimonial home
Both the husband and the wife wish to retain the former matrimonial home and this appears to have been the driving force behind their inability to reach any agreement in this matter.
The wife argued that she wished to retain the matrimonial home for two reasons. Firstly, she wished to provide the children with the stability and surety of being able to continue to live in the home that they had known most of their lives.
In the first family report prepared by Dean Das, he noted that this was a very much live issue for the children. However, in his second report, Mr Das noted that the need to remain in the matrimonial home was no longer a major issue for the children. In paragraph 30 of his report, he states:
“It was not particularly important to [X], whether or not he lived in the family home on the property, as long as ‘I live nearby’, in order to retain contact with his friends and his current school.”
The second reason the wife wished to retain the former matrimonial home was to enable her to have the use of the parties’ studio to enable her to pursue her career as a working professional artist.
The parties were unable to agree as to the circumstances in which the studio was built and its use after completion.
The parties moved from their rental property called “[A]” to the former matrimonial home in late 2003. It is the husband’s evidence that they had discussed for some time building a custom designed studio on the property to be utilised primarily by him for the creation and construction of his artworks. It is his evidence that construction commenced in February 2004, utilising monies from his business account. In July 2004, the parties borrowed $45,000.00 from the Bendigo Bank.
It was the husband’s evidence that this was borrowed for the studio construction as this was a tax deductible loan as it related to his business as a working artist.
It was the wife’s evidence that she understood the monies were being borrowed to effect long overdue and necessary renovations to the former matrimonial home, and that it was nominally called a loan for the studio for tax purposes only.
It is common ground however that the renovations to the matrimonial home never took place, and that a large proportion of the funds retained by the husband at separation, which have been added-back, represented these borrowed funds.
The studio was completed in August 2004.
It was the husband’s evidence that at the same time as the studio was built, the parties renovated the garage closer to the home for the wife’s use. Thereafter the studio was used primarily by him in the pursuit of his artistic endeavours and the wife utilised the renovated garage space.
It was the wife’s evidence that she used the studio as well, and that at all times it was the parties’ intention that the purpose built studio was for both of them. She did concede however that she also utilised the garage studio for her mosaics and other works.
The wife’s evidence that she put her career “on the back-burner” to care for the children also supports the husband’s evidence that the studio was principally utilised by him.
The husband submitted that he should retain the former matrimonial home because the purpose built studio would enable him to continue to pursue his life as a professional artist, and that it would be extremely difficult for him to do so otherwise. He also indicated this would enable him to better look after the children when they were in his care.
It is clear from the evidence of Mr Das that the children do not link their ongoing happiness and security with the necessity to primarily reside in the former matrimonial home. Their happiness will be ensured by them continuing to live in the area where their friends and schools are located, and by them continuing to have meaningful relationships with both their parents.
I am satisfied on the evidence that this studio was primarily built and designed for use by the husband, and that since its completion, he has had the primary use of same. Since separation and because of the arrangements that the parties have entered into, the husband has had the sole use of that space for the last nearly three years.
In these circumstances, I have formed the view that the husband should be given the opportunity to retain the matrimonial home, and that in the event that he is unable to raise the finances to do so, that the wife then be given an opportunity to buy him out.
Both parties however, are not high-income earners, and it may be that neither of them will be able to raise the necessary funds to buy the other out.
In those circumstances, it is my intention to make orders that make provision for the husband to have the opportunity to buy the wife out. If he is unable to do so, then the wife will have the same opportunity, and if it is not in either of the parties’ capacity to do so, the property shall be placed on the market for sale and a division take place that reflects the adjustments referred to earlier in this judgment.
Costs
Earlier in this judgment, I set out the circumstances surrounding the issue of the valuation of the former matrimonial home.
In his closing, Counsel for the wife sought an order that the husband pay the costs incurred by the wife as a result of the husband’s behaviour in relation to this issue.
In support of that application, it was submitted on behalf of the wife that there had been an agreement between the wife’s solicitors and the husband as to the valuation of the property for the purposes of the trial of $412,500.00, and that this had been confirmed by way of exchange of email. Such email was sighted by me.
On the first morning of the hearing, the husband reneged on that agreement, and as a result of that, the wife was required to seek an updated report from her valuer, and required him to confer with the husband’s valuer.
Because this issue remained live, the matter ran into a fifth day of hearing when it would otherwise have concluded on the fourth day.
As is now known, the husband’s valuer refused to attend court on the fifth day and, having heard the evidence of the wife’s valuer, I made a finding accepting that the value of the former matrimonial home was in accordance with the wife’s valuer’s evidence.
The wife’s valuer gave evidence that his costs for the preparation of the report and for consulting with the husband’s valuer, including GST, was $1,540.00. Mr M, most generously, sought no costs for attending court and giving evidence.
Mr Cantwell indicated that the costs incurred by the wife for the additional day of hearing that would otherwise not have been necessary were some $3,550.00, being his fee as well as the costs of his instructing solicitor.
Section 117(1) of the Act states that:
“Subject to subsection (2)… each party to proceedings under this Act shall bear his or her own costs.”
Section 117(2) of the Act states that:
“If, in proceedings under this Act, the court is of the opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise as the court considers just.”
Subsection 117(2A) of the Act states that:
“In considering what order (if any) should be made under sub-section (2), the court shall have regard to:
(a)the financial circumstances of each of the parties to the proceedings;
…
(c)the conduct of the parties to the proceedings in relation to the proceedings’
…
(e)whether any party to the proceedings has been wholly unsuccessful in the proceedings; and
…
(g)such other matters as the court considers relevant.
Whilst there can be some allowance made for the husband, in that he chose to represent himself in these proceedings, his conduct in relation to this issue is not acceptable.
I am more than satisfied that he had, might I suggest quite sensibly, agreed to compromise on the issue of the differences in the valuation of the former matrimonial home, and that he had confirmed same in writing with the wife’s solicitors. By reneging on that agreement on the morning of the first day of the hearing of the matter, he left the wife with no other option but to re-engage her expert witness, at considerable expense to herself.
In addition, this last minute “change of heart” meant that the experts had to be given sufficient time within the constraints of the time in which the matter was listed, to review their valuations and to confer. Because of that, it was not possible to realistically expect them to give their evidence any earlier than the morning of the fifth day that the matter was allocated for hearing.
The evidence of all other witnesses was completed shortly after
1.30 pmon the fourth day of hearing, and but for the necessity to call the valuers, the matter could have been finalised on that fourth day.
Whilst the decision of the husband’s expert not to attend court to give evidence on the fifth day was something over which the husband had little control, the reality is that this was his witness, and he was unable to produce that witness to the court.
Further, the evidence of the wife’s expert was compelling, and his valuation was accepted as best reflecting the value of the former matrimonial home.
In these circumstances, and in particular looking at the matters which are to be considered when an application for an order for costs is made pursuant to section 117(2A) of the Act, the husband’s conduct in relation to this issue was not acceptable, he has been wholly unsuccessful in relation to the issue of the valuation, and he has extended the hearing of the matter beyond that which would have otherwise been necessary.
Accordingly, I find that the husband should be responsible for the costs unnecessarily incurred by the wife in relation to this issue on an indemnity basis, and order that he pay her costs of the second report of the valuer in the sum of $1,540.00, as well as the costs incurred by her for the matter extending to the fifth day in the sum of $3,550.00, a total of $5,090.00.
I certify that the preceding two hundred and ninety-eight (298) paragraphs are a true copy of the reasons for judgment of Bender FM
Associate: Sarah Hession
Date: 12 May 2009
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