CARRAN and BOSCO

[2010] FCWA 76

JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA

ACT: FAMILY COURT ACT 1997

LOCATION: PERTH

CITATION: CARRAN and BOSCO [2010] FCWA 76

CORAM: CRISFORD J

HEARD: 19 JULY 2010

DELIVERED : 30 JULY 2010

FILE NO/S: PTW 1323 of 2010

BETWEEN: MS CARRAN

Applicant

AND

MR BOSCO
Respondent

Catchwords:

Property settlement - short de facto relationship - contributions

Legislation:

Family Court Act 1997

Category: Not Reportable

Representation:

Counsel:

Applicant: Mr L Durand

Respondent: No Appearance

Solicitors:

Applicant: Durand Gangemi

Respondent: Self Represented Litigant

Case(s) referred to in judgment(s):

Varga & Kelty (2005) FCWA 80 at [21]

WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL
JUDGMENT - PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN

CHANGED

1[Ms Carran] is seeking a property settlement arising out of her de facto relationship with [Mr Bosco]. She says that in the relatively short time they were together she made the overwhelming financial contribution to a property the parties acquired at [Property A]. She wants her substantial contributions recognised.

2Mr Bosco has not played any material part in the proceedings and the trial proceeded in his absence.

Brief background facts

3Ms Carran was born in [Italy] [in] 1988. When the parties commenced living together in September 2007 she was 19 years of age. She will be 22 years of age [in] 2010.

4Mr Bosco was born in [Queensland] [in] 1984. He was 23 years of age when the parties started living together. He is now 26 years of age.

5On 30 October 2007 the parties became the joint registered proprietors of the property in [Suburb R]. In order to acquire this property they jointly borrowed $230,000 from Citibank Pty Ltd and a further $150,000 from Ms Carran’s mother, [Ms Lavery]. The property was purchased for $355,000. The additional borrowings were used for furniture and housing expenses.

6The parties separated in July 2009 when Mr Bosco vacated the premises in [Suburb R].

7Ms Carran commenced proceedings on 12 March 2010. At the first court event on 20 April 2010 Ms Carran was represented by her present solicitors, Durand Gangemi, and Mr Bosco appeared in person.

8After Mr Bosco failed to file his responding documents as ordered by the Court on 20 April 2010, Ms Carran sought leave to proceed on an undefended basis.

9This application was dealt with at a hearing on 21 June 2010. Mr Bosco did not attend the Court until late in the morning at which time the matter had been dealt with and the Court had risen. Leave had been granted. Mr Bosco then filed a Notice of Address for Service. Court orders were sent to him at the address provided.

10Mr Bosco did not serve his Notice of Address for Service on Ms Carran’s lawyers. However, correspondence was sent to him at a work address by Durand Gangemi on 8 July 2010 enclosing Ms Carran’s trial documents.

11At the hearing on 19 July 2010 Mr Bosco did not attend and the matter proceeded in his absence. At the conclusion of the hearing I directed Durand Gangemi to forward the documents relied upon at trial by Ms Carran to Mr Bosco at the address provided in the Notice.

Applicable law

12Part 5A of the Family Court Act 1997 (WA) confers jurisdiction on the Court to make orders for settlement of property owned by parties who have lived in a de facto relationship.

13Section 205Z of the Act provides as follows:

“S 205Z(1) [Requirements to be satisfied]

A court may make an order in relation to a de facto relationship only if satisfied -

(a) there has been a de facto relationship between the partners for at least 2 years;

(b) there is a child of the de facto relationship who has not yet attained the age of 18 years and failure to make the order would result in serious injustice to the partner caring or responsible for the child; or

(c) the de facto partner who applies for the order made substantial contributions of a kind mentioned in section 205ZG(4)(a), (b) or (c) and failure to make the order would result in serious injustice to the partner.”

14That sub-section provides as follows:

“(4)In considering what order (if any) should be made under this section in proceedings with respect to any property of de facto partners, or either of them, the court must take into account —

(a) the financial contribution made directly or indirectly by or on behalf of a de facto partner to the de facto relationship or a child of the de facto relationship to the acquisition, conservation or improvement of any of the property of the de facto partners, 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 de facto partners or either of them;

(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a de facto partner or a child of the de facto relationship to the acquisition, conservation or improvement of any of the property of the de facto partners 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 de facto partners or either of them;

(c) the contribution made by a de facto partner to the welfare of the family constituted by the de facto partners and any children of the de facto partners, including any contribution made in the capacity of homemaker or parent;”

15Ms Carran deposes the de facto relationship was of less than two year’s duration and there are no children of the union.

16What remains in contention is whether Ms Carran has made substantial contributions as set out in s 205ZG(4)(a), (b) or (c) of the Act and that the failure to make an order would result in serious injustice to her.

17There can be no doubt in my mind that the concept of “substantial” needs to be considered in the context of the financial position of a particular party. A substantial contribution for people of limited financial resources may be considerably different to a case involving very wealthy parties. Chief Judge Holden (as he then was) in considering what is meant by “substantial contributions” in s 205X(b)(ii) said in Varga & Kelty (2005) FCWA 80 at [21]:

18“In my view, substantial means something more than usual or ordinary. In my view, s 205X(b)(ii) is aimed at more exceptional circumstances where serious injustice may be caused by the application of sub-section (i).”

19I respectfully agree with what his Honour said.

20It will often be a matter of degree as to when an ordinary or normal contribution becomes a substantial one.

The facts

•Financial contributions – s 205ZG(4)(a)

21I will firstly consider the financial contributions Ms Carran says she made to the acquisition of what is the only asset of significance. These are:

•Borrowings provided by her mother.

•A motor vehicle insurance payout of $14,000 received in 2008. This payment arose out of a motor vehicle accident in which she sustained a whiplash injury in 2006, a time predating the de facto relationship.

•Income from her employment as [an administration] officer with [Company D].

22Ms Carran gave evidence that she had consistently worked with the same employer from before the time the parties commenced cohabitation until the present date. From this employment and during the relationship she almost single handedly serviced the Citibank mortgage. After the parties separated in July 2009 she made all the payments towards the mortgage and the home.

23She says that Mr Bosco was employed for the first two months of their relationship. He worked as a [trades] assistant. She says after that period he worked only sporadically until they separated. He worked casually from time to time, often for a day or two at a time.

24She deposes to making 95% of all the mortgage payments. In her evidence she said that over the 20 or so months of their relationship Mr Bosco contributed a total of about $9,000. She says this amount was used to cover all expenses such as his food, utilities, water and council rates and mortgage payments.

25She said her mother gave her small amounts of money from time to time in order to tide her over.

•Indirect contributions – s 205ZG(4)(b) and contributions to the welfare of the family and as homemaker – s 205ZG(4)(c)

26Ms Carran deposes:

“19.I made most of the indirect financial contributions by maintaining the property and looking after the day to day affairs of the house while the Respondent had recreational activities and hobbies which took his spare time.

20.During the time when the Respondent was unemployed he occupied himself with activities not related to the house or its upkeep.”

27Ms Carran has made attempts to have Mr Bosco remove three car bodies from the premises. She said there was an enormous amount of car parts and tools left at the property. His hobby was restoring motor vehicles.

Conclusion on the requirements to be satisfied prior to the making of any orders

28In the face of no contradictory evidence and my positive assessment of Ms Carran’s credibility in the witness box, I am satisfied that she made a substantial contribution to the present property. At the time the parties commenced cohabitation she was in stable employment which she presently maintains. Due to her mother’s assistance the parties were able to purchase the Suburb R property. She received an insurance payout which was utilised towards the property and the parties’ living expenses. She has made the sole contribution to the property for the last 12 months at least.

29I find that Mr Bosco made some contribution, but it was a minor contribution only. It would be unjust not to consider the application of Ms Carran.

30On that basis I am satisfied I am in a position to make an order adjusting the parties’ property.

31In doing so it is necessary to consider the pool of assets presently available for division. This is not an easy task in this case as I have no evidence as to assets, if any, held by Mr Bosco.

32I have not included a credit card debt of $2,700 of Ms Bosco on the basis it may have been incurred post separation. I now set out the pool of assets although I discuss its composition, in material respects, later in my judgment.

Assets - description	Ownership	Value
Household contents	Applicant	E7,500
[Property A]	Joint	E355,000
2009 motor vehicle	Applicant	E14,000
Total Assets	$376,500
Liabilities
Loan from [Ms Lavery]	Joint	150,000
Citibank Pty Ltd mortgage	Joint	224,104
Citibank car loan	Applicant	E14,000
Total Liabilities	$388,104
Total Net Assets	-$11,604
Superannuation assets
Westscheme Superannuation	Applicant	7,996

33When the parties separated I am told Mr Bosco removed his personal belongings from the property. Since then, despite invitation, he has not availed himself of any opportunity to attend the premises and remove his possessions, including the car bodies.

34Ms Carran is unable to advise the Court whether the car bodies and other miscellaneous car parts and tools remaining at her property have any value.

35Ms Carran is unaware whether Mr Bosco is presently employed. I accept that he has had some employment since separation, but the Court is left in a complete vacuum as to his present circumstances. He was employed sporadically during the relationship.

36The parties do not communicate and Mr Bosco is the subject of a Violence Restraining Order taken out against him by Ms Carran, which is due to expire in 2011.

37The major asset, the Suburb R property, was purchased for $355,000. The present value is arrived at on the basis of two market appraisals provided to the Court during the course of the hearing. One appraisal dated 28 June 2010 estimated a price range on a sale from $350,000 to $365,000 (Brown Murray, Annexure E to the affidavit of Ms Carran sworn 30 June 2010) and a second appraisal between $340,000 and $350,000 (Raine & Horne, 29 June 2010, Exhibit 2).

38It appears highly unlikely the property has increased in value since its purchase. The capital amount owing to Citibank has reduced by some $6,000 in almost three years. Since July 2009 payments towards this debt have been made solely by Ms .Carran I accept that during their relationship they were made almost solely by her with some minimal contribution by Mr Bosco.

39There is no doubt that the monies owing to Ms Carran’s mother, Ms Lavery, will be repaid by her alone. On 14 October 2007 the parties and Ms Lavery entered into a written agreement about the borrowings. That agreement is annexed to Ms Carran’s affidavit. Provision is made in the agreement in the event the parties separate within two years of 22 October 2007. The agreement sets out this possibility as follows:

“5.If, within two years of the settlement date, [Ms Carran] and [Mr Bosco] separate, ownership of the property shall be transferred to [Ms Carran] with transfer expenses to be borne equally by [Ms Carran] and [Mr Bosco]. After all transfer expenses are paid, Damien will be entitled to recover from [Ms Carran] 50% of the mortgage repayments paid up to the date of separation and any furniture and/or chattels that he brought to the property.”

40Ms Carran explained that Mr Bosco’s entitlement to recover 50% of the mortgage payments was based on the understanding when the agreement was made that such mortgage repayments would be made jointly. The reimbursement to him would reflect his contribution. She says he did not make half the payments. I accept her evidence that he made a minor contribution only.

41On the evidence before me it is very difficult to ascertain exactly how much he did contribute towards the mortgage repayments as opposed to any payments that went towards living expenses. In any event, given the amount of the borrowings, any reduction of the mortgage has been in relation to the interest only and the net position is that the debt exceeds the equity in the property.

•Primarily prospective factors – Section 205ZD(3)

42I am not satisfied given the age of these parties and the length of the relationship that this is a factor of relevance in this case.

Discussion

43The Court must make orders that are just and equitable in all the circumstances as set out in Section 205ZG(3) of the Act.

44One needs only to consider the net assets of the parties as reflected in the pool of assets to appreciate there is nothing to divide between them. The Court accepts this may be a simplistic approach given that, over time, the property in Suburb R may appreciate in value. However, there is nothing to suggest that at present there is property available for division. Rather, there is debt to be paid. Ms Carran accepts she will pay all this.

45Although I accept Mr Bosco made some contribution towards the parties’ living expenses and some payment to the mortgage, I am not satisfied that it is an appropriate case to simply reimburse him any amounts he contributed in a financial sense. Firstly, any such amounts are not capable, on the evidence before me, of quantification and given the initial and ongoing contributions of Ms Carran, it would be unjust to increase the debt level she is currently servicing.

46I am satisfied that the property should be transferred to Ms Carran absolutely and that, in the main, the orders she seeks are appropriate in all the circumstances.

47The orders I intend to make are as follows:

1. Within 30 days of the making of these Orders the Respondent sign all necessary documents in order to transfer, at the Applicant’s expense, all his interest and entitlement in the property situate at 29 Property A and more particularly described as Lot XX in Certificate of Title bearing Volume ZZ Folio YY to the Applicant.

2. Upon compliance with Order 1 hereof the Applicant is to forthwith take all steps to refinance Mortgage XXXX which is currently in the joint names of the parties into her sole name and indemnify the Respondent in respect to all claims and liabilities arising from and as a result of that said Mortgage.

3. The Respondent transfer to the Applicant the following items which are in the Applicant’s possession or control:

(a) Applicant’s motor vehicle (Registration No XXXX);

(b) Applicant’s bank accounts;

(c) Applicant’s Superannuation policy; and

(d) Furniture and personal items

4. The Applicant will indemnify the Respondent in respect to any claim or liability arising from the items referred to in Order 3 hereof.

5. The Applicant transfer to the Respondent the following items which are in the control or possession of the Respondent:

(a) Respondent’s motor vehicle;

(d) Furniture and personal items.

(b) Respondent’s bank accounts; and

(c) Respondent’s superannuation policy

6.The Respondent will indemnify the Applicant in respect to any claim or liability arising from the items referred to in Order 5 hereof.

7.The Applicant will indemnify the Respondent in relation to the sum of ONE HUNDRED AND FIFTY THOUSAND DOLLARS ($150,000.00) being a joint liability to MS LAVERY.

8.Within 28 days of these orders the Respondent is to arrange through the Applicant’s solicitor to have the car bodies and car parts removed from Property A and in default the Applicant be at liberty to dispose of these items.

9.In the event the Respondent fails to comply with Order 1 hereof then the Principal Registrar of the Family Court of Western Australia shall be empowered pursuant to Section 106A of the Family Law Act 1975 to sign such documents in the name of the Applicant and to do all acts and things otherwise necessary to give validity and operation to orders 1 and 2.

I certify that the preceding [47] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court

Associate