FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Carew & Carew [2024] FedCFamC2F 1486
File number(s): SYC 6524 of 2022 Judgment of: JUDGE MURDOCH Date of judgment: 25 October 2024 Catchwords: FAMILY LAW – PROPERTY – Application for property adjustment – 14 year relationship with the parties living separately under the same roof for a further 4 years post separation - Where the husband’s assertion that an inheritance received by him post separation should be excluded from the property pool available for adjustment between the parties is rejected - Where the wife's credibility was impacted due to frequent exaggeration in both her written and oral evidence - Where a disproportionate amount of hearing time encompassed issues of homemaker and parenting contributions - Where the wife was the primary income earner and the husband was the primary carer of the children - Where both parties seek a Kennon adjustment – Where a finding made that the husband’s contributions were made discernibly more onerous by the conduct of the wife - Where the wife made greater parenting contributions upon the husband vacating the former matrimonial home in circumstances where she cares for the children twelve nights a fortnight and the husband does not pay child support- Where the parties’ superannuation entitlements are dealt with in a separate pool of property – Finding of equal contributions to the superannuation property pool and 54% in the husband’s favour to the non-superannuation property pool - no adjustment made to the contribution findings. Legislation: Family Law Act 1975 (Cth) ss 75(2), 79, 117B Cases cited: Bell and Bell (1993) FLC 92-347
Bonnici & Bonnici (1992) FLC 92-272
Calvin & McTier (2017) FLC 93-785
Coghlan v Coghlan [2005] FamCA 429
Fields & Smith [2015] FamCAFC 57
Holland & Holland [2017] FamCAFC 166
Horrigan & Horrigan [2020] FamCAFC 25
Kennonv Kennon (1997) FLC 92-757
Noetel and Quealey (2005) FLC 93-230
Stanford & Stanford [2012] HCA 52
T & T (2006) FLC 93-263
Division: Division 2 Family Law Number of paragraphs: 220 Date of last submission/s: 5 September 2024 Date of hearing: 2 – 5 September 2024 Place: Sydney Counsel for the Applicant: Mr Jackson Solicitor for the Applicant: Tomasevic Poljak Lawyers Counsel for the Respondent: Mr Macarounas Solicitor for the Respondent: Etheringtons Solicitors ORDERS
SYC 6524 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS CAREW
Applicant
AND: MR CAREW
Respondent
ORDER MADE BY:
JUDGE MURDOCH
DATE OF ORDER:
25 OCTOBER 2024
THE COURT ORDERS THAT:
1.Within three (3) months from the date of these Orders the Wife pay to the Husband the sum of $1,446,000 (“the settlement sum”).
2.Simultaneously with the Wife’s compliance with Order 1 above, the Husband is to do all acts and provide all consents and sign all documents as are necessary to:-
a.transfer to the Wife, all of his right, title and interest in the property known as and situated at B Street, Suburb C, New South Wales being the whole of the land comprised in Certificate…
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- Carew & Carew [2024] FedCFamC2F 1486
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CaseChat Overview and Summary
The court meticulously evaluated the credibility and evidence provided by both parties. It found that the wife's credibility was undermined by her tendency to exaggerate in both written and oral testimonies. The husband's argument that his post-separation inheritance should be excluded from the property pool was rejected. The court found that the husband's contributions to the relationship were more onerous due to the wife's conduct, particularly after the separation. Despite the wife being the primary income earner, the court recognised the husband's significant role as the primary caregiver for the children. The court assessed the contributions to both the superannuation and non-superannuation property pools, ultimately finding equal contributions to the superannuation pool and a 54% contribution by the husband to the non-superannuation property pool.
Based on these findings, the court ordered that the wife pay the husband $1,446,000 within three months, along with other property settlement arrangements. The court also detailed the process for splitting the wife's superannuation interest in favour of the husband, including the steps for calculating and transferring the entitlements. The orders ensure that the financial relationships between the parties are finally determined, in line with the court's obligations under the Family Law Act 1975. The court's decision provides a clear framework for the division of property and superannuation interests, reflecting the unique circumstances and contributions of each party.
Orders
Orders of the court
SYC 6524 of 2022
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN:
MS CAREW
Applicant
AND:
MR CAREW
Respondent
ORDER MADE BY:
JUDGE MURDOCH
DATE OF ORDER:
25 OCTOBER 2024
THE COURT ORDERS THAT:
1. Within three (3) months from the date of these Orders the Wife pay to the Husband the sum of $1,446,000 (“the settlement sum”).
2. Simultaneously with the Wife’s compliance with Order 1 above, the Husband is to do all acts and provide all consents and sign all documents as are necessary to:-
a. transfer to the Wife, all of his right, title and interest in the property known as and situated at B Street, Suburb C, New South Wales being the whole of the land comprised in Certificate of Title Folio Identifier … ("the former matrimonial home");
b. cause D Pty Ltd ("the Caveator") to withdraw Caveat number … secured over the former matrimonial home and provide a Withdrawal of Caveat in registerable form and;
c. payout in full all liabilities to the Caveator;
d. pay all costs associated with the Caveat and Withdrawal of Caveat;
e. pay all New South Wales Land Registry registration fees associated with the Withdrawal of Caveat; and
f. pay all Property Exchange Australia ("PEXA") fees associated with the Caveator providing the Withdrawal of Caveat and registration of the Withdrawal of Caveat.
3. Simultaneously with Orders 1 and 2 above the Wife and Husband shall do all acts and provide all consents and sign all documents as are necessary to discharge registered Mortgage … to E Bank secured over the former matrimonial home and refinance the mortgage in the Wife’s sole name at the Wife’s expense and the Wife thereafter be responsible for and pay the mortgage secured upon the said property and all other charges upon the said property, including but not limited to land tax, land rates, and water rates, and indemnify the husband in relation to the same.
4. Within 14 days of the date of these Orders the Wife and the Husband do all acts and things, provide all consents and sign all necessary documents to:-
a. cause the net proceeds of sale of the property situated at F Street, Suburb G, Queensland, currently held by Etheringtons Solicitors, to be distributed equally to each of the parties;
b. cause the monies currently held jointly by the parties in the E Bank Offset account BSB … account number …66 to be distributed equally to each of the parties and thereafter to close the said account.
5. In the event that the Wife fails to comply with Orders 1 & 3 above then the parties shall do all acts and provide all consents and sign all necessary documents to effect the sale of the former matrimonial home on the following terms:
a. to list for auction with an agent agreed upon by the parties in writing within fourteen days and failing agreement the agent be appointed by the President of the Real Estate Institute of New South Wales or his or her nominee;
b. give such instructions to a solicitor to act on the sale of the property agreed upon in writing within fourteen days, and failing agreement as to the identity of the solicitor, the solicitor be appointed by the President of the Law Society of New South Wales or his or her nominee;
c. market the former matrimonial home for sale by public auctions to be held on-site within six weeks of the property being listed for sale at a reserve price to be agreed by the parties in writing and failing agreement at a reserve price seven days prior to the auction, at such reserve price as determined by the single expert;
d. attend the auction and in the event that the reserve price set for the auction is not reached negotiate with the highest and second highest bidder and accept any offer to purchase that is the highest made within 5 per cent of the reserve price set for that auction unless the parties otherwise agree in writing;
e. execute the contract for sale and in the event that the parties fail to agree on the terms of the contract for sale, the terms recommended by the solicitor acting on the sale shall be adopted; and
f. the parties are to co-operate with the real estate agent in relation to the marketing of the former matrimonial home for sale including making the keys readily available and allowing inspection of the former matrimonial home at all times reasonably requested by the agent.
6. The proceeds of sale of the former matrimonial home pursuant to Order 5 above shall be paid in the following manner and priority:
a. to discharge registered Mortgage number … to E Bank;
b. payment of agent's commission and advertising or other expenses. if any, payable on the sale;
c. payment of the legal costs and outlays relating to the sale; and
d. the balance to be paid, as follows:
i. the settlement sum to the Husband together with an additional sum representing interest pursuant to Section 117B of the Family Law Act 1975 (Cth) at a rate prescribed by the applicable Rules of the Court and such interest calculated from the expiration of three (3) months from the date of these Orders; and
ii. the remaining balance to the Applicant Wife.
7. In the event that the former matrimonial home is not sold at the auction pursuant to Order 5 above or within fourteen (14) days after the date of the auction by further negotiation then the parties shall cause a further auction of the former matrimonial home to be held within two (2) months after the date of the first auction and for that purpose the provisions of Order 6 above shall apply.
8. Pending the Husband transferring all of his right, title and interest in the former matrimonial home to the Wife or, if applicable, pending completion of the sale of the former matrimonial home:
a. The Wife shall have the sole right to occupy the former matrimonial home.
b. The Wife shall pay all outgoings of the former matrimonial home including the loan repayments secured by way of mortgage over the property, council rates, water rates, electricity, gas and water usage and home building and contents insurance as and when they fall due
c. Neither party shall further encumber the former matrimonial home without the consent in writing of the other party
9. The following Orders are made under Part VIII of the Family Law Act 1975 and operate in accordance with Part VIIIB of the Family Law Act 1975 and in these Orders:
a. "the Carew Super Fund" means the Carew Super Holdings being a regulated superannuation fund (ABN …) established by Deed of Trust active from 6 April 2018 and listed as a complying superannuation fund on the Australian Government Register maintained by the Australian Taxation Office at the uniform resource locator www.superfundlookup.gov.au
b. "the Trustee" means the Carew Super Holdings Pty Ltd (ACN …), being the corporation appointed as the trustee of the Carew Super Fund.
c. "the Carew Super Fund Governing Rules" means the provisions of the Deed of Trust establishing the Carew Super Fund.
d. "the Bare Trust" means the trust established in accordance with r.67A of the Superannuation Industry (Supervision) Act 1993 to hold the title to the City K Property as required under the limited recourse borrowing arrangements.
e. "the Bare Trustee" means Carew Property Holdings Pty Ltd (ACN …) appointed as trustee of the Bare Trust.
f. "the City K Property" means the estate in fee simple at Lot …. Survey Plan … in City K in the State of Queensland located at and known as H Street, Suburb J, in the State of Queensland.
g. "the r.7A.06 Request" means the request by the Respondent Husband pursuant to r. 7 A.06 of the Superannuation Industry (Supervision) Regulations 1994 for the transfer of the Transferable Benefits from the superannuation interest in the name of the Applicant Wife in the Carew Super Fund to a superannuation interest in the name of the Respondent Husband in another complying superannuation fund.
h. "the Transferable Benefits" means the benefits transferred on the Transfer Day on behalf of the Respondent Husband from the Applicant Wife's superannuation interest in the Carew Super Fund in accordance with r.7A.12 of the Superannuation Industry (Supervision) Regulations 1994.
i. "the Rollover Request" means the request by the Respondent Husband in accordance with the Carew Super Fund Governing Rules to rollover the Respondent Husband's member benefit on the Transfer Day to a superannuation interest in the name of the Respondent Husband in another complying superannuation fund.
j. "the Transfer Day" means the day selected by the Trustees for the transfer of the Transferable Benefits and the rollover of the Respondent Husband's member benefits.
k. "the Respondent Husband's New Super Fund" means another complying superannuation fund nominated by the Respondent Husband.
10. The next clause of this Order binds the parties and the Trustee to observe the steps in splitting the superannuation interest of the Applicant Wife in favour of the Respondent Husband. Step 1 to Step 5 may be referred to as "the Splitting Order". where the Splitting Order has the effect that whenever a splittable payment becomes payable, the Respondent Husband is entitled to be paid the amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001 following the allocation of a base amount in favour of the Respondent Husband.
11. The entitlement of the Respondent Husband and the corresponding reduction in the entitlement of the Applicant Wife are determined as follows:
Step 1: Determine the relevant date as required by the definition of that term in r.3 of the Family Law (Superannuation) Regulations 2001: Relevant Date = 15 November 2023
(Ref: R.3 (definition of relevant date) of the Family Law (Superannuation) Regulations 2001)
Step 2: Determine, on the relevant date, the amount to be taken as the value of the Applicant Wife's superannuation interest in the Carew Super Fund: Amount= $412,667.30
(Ref: s.90XT(2) of the Family Law Act 1975 and r.22 of the Family Law (Superannuation) Regulations 2001)
Step 3: Allocate the Base Amount as follows:
a. Base Amount = $223,000
b. This amount is the Base Amount allocated to the Respondent Husband.
(Ref: s.90XT(4) of the Family Law Act 1975)
Step 4: Award the entitlement to the Respondent Husband:
The Respondent Husband is entitled to be paid the amount calculated in accordance
with Part 6 of the Family Law (Superannuation) Regulations 2001 by reference to the
base amount allocated to the Respondent Husband from the Applicant Wife's superannuation interest in the Carew Super Fund.
(Ref: s.90XT(l)(a)(i) of the Family Law Act 1975)
Step 5: Reduce the entitlement of the Applicant Wife:
The Applicant Wife's entitlement to any splittable payment made by the Trustees after making of this Order is reduced correspondingly by force of this Order and it is noted that the entitlement of such other person to whom a splittable payment would have been from the Applicant Wife's superannuation interest in the Carew Super Fund would also be reduced.
(Ref: s.90XT(1)(a)(ii) of the Family Law Act 1975)
Step 6: Bind the Trustee to the payment splitting order:
The Trustee shall do all such acts and things and sign all such documents as may be
necessary to:
a. calculate, in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001 the entitlement awarded to the Respondent Husband in Step 4; and
b. pay the entitlement whenever the Trustee makes a splittable payment from the Applicant Wife's superannuation interest in the Carew Super Fund.
(Ref: s.90XZD of the Family Law Act 1975)
Step 7: Set the operative time:
The operative time for the Splitting Order is the beginning of the day upon which this Order is made.
Step 8: Confirm procedural fairness and service of the Splitting Order on the Trustee:
a. Procedural fairness as required by s.90XZD of the Family Law Act 1975; and
b. Service on the Trustee of the Splitting Order:
shall be deemed to have occurred on the date of this Order by reason that the parties are the only directors of the trustee of the Carew Super Fund.
Step 9: The Respondent Husband shall serve a notice on the Trustee in accordance with r.72 of the Family Law (Superannuation) Regulations 2001 giving notice of his name, date of birth, and the fact that he is a member of the Carew Super Fund.
Step 10: The Trustee shall serve:
a. a payment split notice on the Respondent Husband and the Applicant Wife in accordance with r.7A.03 of the Superannuation Industry (Supervision) Regulations 1994; and
b. a notice under r.2.36C of the Superannuation Industry (Supervision) Regulations 1994 giving the Respondent Husband notice that he may request the transfer of the Transferrable Benefits under r.7A.06 of the Superannuation Industry (Supervision) Regulations 1994.
c. the service of the payment split notices and the r.2.36C notice to be served within 28 days of the operative time or within 28 days of service of this Order on the Trustee. whichever is the later.
Step 11: The Respondent Husband shall make the r.7A.06 Request to transfer of the Transferable benefits on his behalf to the Respondent Husband's New Super Fund, such request to be made within 228 days of his receipt of the payment split notice.
Step 12: The Respondent Husband shall make the Rollover Request to rollover the amount of his member benefits on the Transfer Day such request made contemporaneously with the Respondent Husband's r.7A.06 Request.
Step 13: The Trustee shall prepare a statement of financial position (as mentioned in s.35B of the Superannuation Industry (Supervision) Act 1993) to record the up to date amount of each member benefit for the Transfer Day.
Step 14: The Trustee shall calculate the Transferable Benefits on behalf of the Respondent Husband, calculated as follows:
a. Identify the Base Amount from Step 3:
b. Do not adjust the base amount as mentioned in r.1.03 (para (b) of the definition of transferable benefits of the Superannuation Industry (Supervision) Regulations
c. The result is the amount of the Transferable Benefits established for the Respondent Husband;
d. The taxation and preservation components of the Transferable Benefits are in the same proportions as the taxation and preservation components of the Applicant Wife's member benefit on the Transfer Day.
e. The Trustee may combine the Transferable Benefits established for the Respondent Husband with the Respondent Husband's existing member benefit proportioning the taxation and preservation components in accordance with the respective proportioning rules.
Step 15: The Trustee shall transfer the Transferable Benefits and rollover the amount of the Respondent Husband's member benefits on the Transfer Day after the operation of the splitting order and the Trustee shall sell, liquidate or otherwise realise in cash the necessary investments held by the Trustee so that the transfer on behalf of the Respondent Husband on the Transfer Day shall be a transfer in cash.
Step 16: The Respondent Husband shall:
a. Resign as a director of the Trustee of the Carew Super Fund.
b. Transfer his shareholding in the Trustee Company of the Carew Super Fund to the Applicant Wife.
c. Resign as a director of the Trustee of the Bare Trust.
d. Transfer his shareholding in the Bare Trustee to the Applicant Wife.
e. Acknowledge the termination of his membership of the Carew Super Fund; and
f. Relinquish all rights and authorities in relation to the management and administration of the Carew Super Fund including but not limited to operating bank accounts of the Carew Super Fund and removing himself as a signatory on the said accounts as well as the surrender of all passwords and other rights of digital access.
12. Pending the transfer of the Transferable Benefits and the rollover of the Respondent Husband's member benefit to the trustee of the Respondent Husband's New Super Fund, the Respondent Husband and the Applicant Wife be and are hereby restrained from:
a. Making a death benefit nomination in favour of a child as described in r.13 of the Family Law (Superannuation) Regulations 2001:
b. Dealing with, charging, encumbering or disposing of any item of investment property in Carew Super Fund other than in accordance with these Orders:
c. Exercising power under Carew Super Fund Governing Rules:
To appoint. but subject to the Order immediately following this Order a replacement or a new trustee: and
To admit a person as a member of the Carew Super Fund: and
d. Making any application to the Trustee for the transfer or payment of member benefits, in whole or in part. other than in accordance with the terms of this Order.
13. In the event of the death of either the Respondent Husband or the Applicant Wife, or the loss of capacity of either the Respondent Husband or the Applicant Wife, requiring the appointment of a legal personal representative of either the Respondent Husband or the Applicant Wife and before the transfer of the Transferable Benefits and the rollover of the Respondent Husband's member benefit:
a. Any death benefit or benefit by way of total and permanent incapacity, to be paid by the Trustee in accordance with Carew Super Fund Governing Rules shall only be determined after the Trustee has observed the obligations under these Orders: and
b. This Order shall operate as an amendment to, and be incorporated into, Carew Super Fund Governing Rules as a Trustee amendment in accordance with the said Governing Rules.
14. These Orders bind the legal personal representatives, beneficiaries, successors, heirs and assigns of the Respondent Husband and the Applicant Wife and in the event of:
a. the loss of capacity of either the Respondent Husband or the Applicant Wife, or both of them: or
b. the death of either the Respondent Husband or the Applicant Wife, or both of them:
c. the legal personal representative holding an enduring power of attorney of the party losing capacity or the legal personal representative of the deceased (as the case may be) shall be appointed as a director of a Trustee of the Carew Super Fund so that the Carew Super Fund continues to meet the definition of a self-managed superannuation fund in s.17A of the Superannuation Industry (Supervision) Act 1993 and the legal personal representative so appointed shall observe the obligations under these Orders of the party who has lost capacity or is deceased (as the case may be).
15. Except as otherwise provided for in these Orders, the Wife and the Husband each be the sole legal and beneficial owners of all items of all property including household contents, money, motor vehicles, insurances, equities, superannuation entitlements and personal effects currently in the possession or control of each of them respectively to the exclusion of the other.
16. Except as otherwise provided for in these Orders, the parties are each solely entitled to the exclusion of the other to all financial resources of whatsoever nature and kind in their name, possession, or control and to which they are or may become entitled.
17. Except as otherwise provided for in these Orders, each party shall retain to the exclusion of the other, sole responsibility for all and any liability currently in their names.
18. Each party shall do all things necessary including providing all consents to give effect to these Orders in the time periods described in these Orders.
19. In the event that either party fails or neglects to sign any document pursuant to these Orders, a Registrar of the Federal Circuit and Family Court of Australia (Division 2) is hereby appointed to execute such documents in the name of the party in default so as to give validity and operation to these Orders pursuant to s 106A of the Family Law Act 1975 (Cth) upon being satisfied of such failure or neglect by way of affidavit evidence.
20. Save as to costs, all outstanding Applications and Responses are otherwise dismissed.
21. Should any party wish to make an application for costs of or incidental to these proceedings, they are to file and serve within 28 days of the date of these orders an Application in a Proceeding specifying the orders sought as to costs and any affidavit in support thereof of no more than 5 pages and 5 annexures.
22. In the event that no application is filed pursuant to Order 26 then all applications for costs are dismissed.
AND IT IS NOTED:
A. In making the Splitting Order:
a. The duty under s.81 of the Family Law Act 1975 to finally determine the financial relationships between the parties depends on when a splittable payment becomes payable; and
b. Service of this Order on the Trustee will enliven the Trustee' obligations in accordance with the operating standards under Part 7A of the Superannuation Industry (Supervision) Regulations 1994 and the effect of those obligations is to finally determine the financial relationships between the parties.
B. The value of the Transferable Benefits in the name of the Respondent Husband is calculated in accordance with r. 7 A.12 of the Superannuation Industry (Supervision) Regulations 1994.
C. Pursuant to r.14F of the Family Law (Superannuation) Regulations 2001, and payments from the Applicant Wife's superannuation interest in the Carew Super Fund made after the Trustee has transferred the Transferable Benefits on behalf of the Respondent Husband are not splittable payments.
D. The operation of the Splitting Order constitutes a family law superannuation payment as that term is defined in s.307-5(7) of the Income Tax Assessment Act 1997.
E. The taxation components of the Respondent Husband's superannuation interest after the operation of the Splitting Order are worked out in accordance with the proportioning rule in s 307-125 of the Income Tax Assessment Act 1997 by the incorporation of the taxation components of the Applicant Wife's superannuation interest into the Respondent Husband's superannuation interest in the proportion that each component bears to the total.
F. The preservation components of the Respondent Husband's superannuation interest after the operation of the Splitting Order are worked out in accordance with the proportioning rule in r.7A.12(3) and (3A) of the Superannuation Industry (Supervision) Regulations 1994 by the incorporation of the preservation components of the Applicant Wife's superannuation interest into the Respondent Husband's superannuation interest in the proportion that each component bears to the total.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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