Chambers and Chambers
[2007] FMCAfam 223
•17 September 2007
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CHAMBERS & CHAMBERS | [2007] FMCAfam 223 |
| FAMILY LAW – Property – contribution throughout the marriage – percentage split – periods of separation – assets introduced. |
| Family Law Act Evidence Act |
| Hickey (2003) FLC 93-143 Weir & Weir (1993) FLC 92-338 |
| Applicant: | BARRY WINFIELD CHAMBERS |
| Respondent: | ROBYN MARION CHAMBERS |
| File number: | BRM5919 of 2004 |
| Judgment of: | Burnett FM |
| Hearing date: | 15 March 2007 |
| Date of last submission: | 15 March 2007 |
| Delivered at: | Brisbane |
| Delivered on: | 17 September 2007 |
REPRESENTATION
| Counsel for the Applicant: | Mr O’Neill |
| Solicitors for the Applicant: | Stacks Grays Lawyers |
| Counsel for the Respondent: | Mr Burridge |
| Solicitors for the Respondent: | Butts & Barkley |
ORDERS
That there be judgment for the Applicant against the Respondent in the sum of $182,348.35.
That the matter be adjourned to hear the parties on ancillary orders.
That costs be reserved.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT BRISBANE |
BRM5919 of 2004
| BARRY WINFIELD CHAMBERS |
Applicant
And
| ROBYN MARION CHAMBERS |
Respondent
REASONS FOR JUDGMENT
Introduction
In this proceeding the Applicant Barry Winfield Chambers (the Applicant) seeks property settlement orders pursuant to section 79 of the Family Law Act against the Respondent Robyn Marion Chambers (the Respondent).
Background
The Applicant is a divorced man now aged 65 (date of birth 13 March 1941). The Respondent is a divorced woman aged 54 (date of birth 13 August 1952). The Applicant and Respondent were married on or about 24 October 1981 and separated in early 2004. The precise date of separation is not entirely clear from the material.
Although there appears to have been a period of separation in 1987 and another period in 2000 the parties otherwise lived continuously together between 1981 and 2004.
Both parties worked throughout the term of the relationship. The Applicant was employed in various occupations within the hospitality industry. He is now retired. The Respondent has been employed and/or otherwise conducted business as a hairdresser. She continues to do so.
The parties relocated from New South Wales to Queensland and in 2000 the Applicant unsuccessfully sought employment in direct marketing and real estate. At one stage he was fully employed building the parties’ new house situate at Underwood. The Applicant ultimately returned to employment in the hospitality industry before finally retiring in June 2002.
There were two children to the marriage. Both are now aged over 18 and neither the Applicant or Respondent claim them as relevant to the resolution of property settlement procedures.
This matter had previously been heard and determined at first instance. However an appeal against that decision was successful and a retrial was ordered. I have been careful not to examine either the judgment at first instance or the judgment or record of appeal. My deliberations in this proceeding are based solely on the evidence placed before me at the trial and submissions (both oral and written) made by the parties.
The principal issues in dispute between the parties concern:
a)identification of the property comprising the property pool;
b)valuation of certain assets within the pool;
c)the appropriate split of that property when considered against sections 79(4) and 75(2) considerations.
Governing principle
The approach to be adopted in a property case is well settled and stated by the Full Court for example in Hickey (2003) FLC 93-143 that:
“The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of section 79. That approach involves four interrelated 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 contributions of the parties within the meaning of section ss.79(4)(a), (b) & (c) and determine the contribution based on entitlements of the parties expressed as a percentage of the net value of the property of the party. Thirdly, the Court should identify and assess the relevant manners referred to in ss.79(4)(d), (e), (f) & (g) (“the other factors”) including, because of s.79(4)(c), the matters referred to in section 7592) so far as they are relevant, and determine the adjustment (if any) that should be made to continuation based on the entitlements of the parties established at step 2. Fourthly the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all of the circumstances of the case; …”
Property pool
Save as to matters of valuation the following assets are agreed to form part of the matrimonial asset pool:
| No. | Particulars | Applicant’s Value | Respondent’s Value |
| 1. | Proceeds of sale of Pinnacle unit and marina | $420,000 | $360,000 |
| 2. | Coombabah House | $120,000 | $145,000 |
| 3. | Motor vehicle – Applicant | $5,000 | $10,000 |
| 4. | Motor vehicle – Respondent | $6,000 | $6,000 |
| 5. | Respondent’s hair salon business | $5,000 | $5,000 |
| 6. | Chattels – Applicant | $8,050 | $5,000 |
| 7. | Superannuation – Respondent | $31,932 | $28,000 |
Matters in contention in respect of both quantum and inclusion within the property pool include:
| No. | Particulars | Applicant’s Value | Respondent’s Value |
| 1. | Chattels – Respondent | $20,000 | Nil |
| 2. | Shares – Respondent | $21,000 | Nil |
| 3. | Cash held for Respondent on trust by brother | Not known | $7,000 |
| 4. | Funds undisclosed by Applicant to Respondent | Nil | $206,300 |
| 5. | Cash payment by Applicant to Respondent in November 2005 | $70,000 | |
| 6. | Wife’s legal expenses | Not known | $40,000 |
| 7. | Additional sums received by Applicant and not disclosed | Nil | $58,000 |
Pinnacle Unit and Marina
In approximately November 2003 the Respondent completed the purchase of a contract for purchase of Unit 40 in an apartment block named The Pinnacle. In addition to the purchase of Unit 40 she also purchased a marina berth.
By contract dated 24 May 2006 the Respondent entered into a contract to sell the marina for $20,000 to Smithson Pty Ltd. That contract settled and the sum of $17,469.58 was paid to the Respondent after sale expenses (including legal expenses).
In addition the Respondent entered into an agreement to sell Unit 40. Unfortunately the contract in respect of that transaction has not been exhibited in the proceedings. Accordingly it is difficult to be more precise in terms of its relevant particulars. In any event in the Respondent’s affidavit filed 5 March 2007 the Respondent deposed to the sale of both the Marina and Unit 40. She swore that the Marina was sold for $20,000 and Unit 40 for $400,000[1]. The Respondent deposed to “receiving $360,000 net in July/August 2006 after having paid $40,000 to my brother Bruce Hughes”. The figure of $360,000 is the figure identified in the Respondent’s case outline as constituting the proceeds of sale on the Unit. Clearly that figure is incorrect. The Applicant has more accurately identified that the value of the sale at $420,000 based upon the Respondent’s own material. Save for the sum of approximately $2,500 which is attributable to sale costs as demonstrated in the settlement sheet[2] no other figure was provided to assist in calculating the net proceeds available to the estate following the sale of the Pinnacle unit and the marina. In the circumstances I assess the value of the proceeds following sale at $417,500. The proceeds have since been dispersed by the respondent. The disposition is in some part accountable, although not in full.
[1] Paragraph 8 in her affidavit filed 4 December 2006 (at paragraph 86)
[2] Affidavit of Applicant filed March 2007 Appendix 1
Coombabah House
There was a contest between the parties concerning the valuation of a property located at Coombabah acquired by the Applicant following separation. The property was a relocatable home situate in a relocatable home park at Coombabah. For the Applicant it was contended that the value of the property was in the order of $120,000 and for the Respondent it was contended that the value of the property was in the order of $140,000 to $150,000. The property was originally purchased for a sum of $145,000 in June 2004.
For the Applicant a valuer, Mr Previte, gave evidence. He is a registered valuer who expressed an opinion that the value of the property was in the order of $120,000. In reaching his conclusion he particularly relied upon a number of comparative sales. The first comparative sale requiring mention concerns comparative sale number 2 which related to Lot 26 in the same complex. He noted that the property had been listed for sale at $130,000 but sold for $120,000. In his view the property was a superior property to the subject property particularly in terms of the fit-out of its kitchen and living area. In addition he had also taken into account sales from a number of other relocatable home parks in the Coombabah region.
Mr Olive who gave evidence for the Respondent stated that in his opinion the subject property had a valuation in the order of $140,000 to $150,000. Generally he noted that no property had been sold in that complex in the last six months for any figure near $145,000 and as far as he was aware the last sale was at $130,000 in respect of a unit which required work. He relied principally upon sales in the relevant relocatable home park. In particular in respect of Lot 26. He acknowledged that at the time of initial inspection he was informed that the property had been sold for $120,000. He did not agree with the assessment by Mr Previte that the lot had a superior presentation. Indeed he noted it was inferior to the subject. He acknowledged that overall in the absence of an immediately direct comparison that the best that he could do was extrapolate out an opinion. He agreed that valuation was not a perfect science but expected two valuers would, in the ordinary course, expect to achieve a common valuation plus or minus a five per cent variation.
Mr Olive is a valuer of some 25 years experience as opposed to Mr Previte who is a valuer of some 6 years experience. Perhaps most significantly Mr Olive focussed on the subject complex for the purpose of assessing valuation. He too had the advantage of speaking with the actual purchaser of one of the comparative properties rather than relying on the information provided by the complex management. Generally I have preferred his evidence to that of Mr Previte.
The points of difference between the values turned on the subjective nature of the matters making up the valuation in this instance, particularly with respect to items such as condition (a matter which I would not expect ordinarily be the subject of expert opinion) and in particular the fact that the two different valuers each within a month of inspecting the principle comparative property formed diametrically differing views as to its quality (one stating it was superior to the subject and the other stating it was inferior to the subject) (again another matter which would not ordinarily be the subject of expert opinion). Their opinions on such subjective matters has left those issues open for resolution by me. Accordingly I consider in the circumstances that a valuation of $135,000 reflecting the mid range between the two valuations as providing the most accurate assessment of value. I assess the value of the Coombabah House at $135,000.
Motor vehicle - Applicant
The Applicant estimates the value of his motor vehicle at $5,000. The Respondent says $10,000. Neither party has justified their assertion by the provision of independent valuation evidence. In these circumstances I assess the value at $7,500.
Motor vehicle - Respondent
The Respondent estimates the value of her motor vehicle at $6,000. Although not supported by any valuation evidence this estimate remained unchallenged. I assess the value of the Respondent’s value at $6,000.
Chattels - Applicant
The Applicant says his chattels are worth $8,050. The respondent says $5,000. Again neither party has justified their assertion by the provision of independent valuation evidence. In the circumstances I assess the value of the Applicant’s chattels at $6,425.
Superannuation - Respondent
In her case outline the Respondent says that her superannuation was worth $28,000. That figure appears to have had its origin in her financial statement filed 4 December 2006. In her most recent financial statement filed 5 March 2007 that sum was identified at $31,932. In the absence of contrary evidence I accept that sum.
Respondent’s Chattels
In her case outline the Respondent does not claim to the holding of chattels of any value. Nor are any referred to in her Form 13 financial statement. The Applicant gave evidence that at the earlier proceeding the Respondent had admitted to retaining all of the furnishing and chattels purchased since the parties had relocated to Queensland and that those chattels had a value of $20,000[3]. However from cross examination it appears that the principal chattels in question were sold with the Pinnacle apartment. The Respondent claims only to have retained basic chattels including pots, pans and linen. No value has been ascribed to those items. Accordingly I can make no allowance for them.
[3] Affidavit of Barry Winfield Chambers filed 2 March 2007 paragraph 33.
Respondent’s shares
The Applicant asserts in his case outline that the Respondent holds shares worth $21,000. There was no evidence to support this contention. The Respondent makes no mention of holding shares in her financial statement. The evidence does however demonstrate that after judgment was entered following the first trial the shares were liquidated to assist in the payment of the judgment sum. They no longer exist and will be accounted for by having the Applicant brought to account in respect of the $70,000 received by him following the last hearing.
Hairdressing Salon
The Respondent conducts a business described as Rascalz Hair Design. That business is alleged in the Respondent’s form 13 to have a value of $5,000.
Evidence concerning its value was called by her from Stuart John Hindle.
Mr Hindle is a valuer. He is an associate member of the Auctioneer and Valuers Association of Australia and it appears from his affidavit that his principal area of valuation expertise is in the matter of valuation of chattels. To that end he afforded a valuation and such valuation would be acceptable for the purposes of s79 of the Evidence Act. However it was particularly clear he had no such “specialised knowledge” permitting him to express an opinion on matters relating to the valuation of goodwill. I accept his valuation of chattels at $1,120 but reject his valuation of goodwill.
However prior to her giving evidence the accountant, Ms Young, had been asked to consider the question of valuation of the goodwill. Based upon the declared income she valued goodwill at about $8,500.
In the circumstances, and rounding up for convenience I assess the value of the business at $10,000.
Funds undisclosed by Applicant to Respondent
Assertions and cross assertions were made by each of the Applicant and the Respondent concerning transfers of funds and missing funds. Largely the outcome of these matters is to be determined by reference to a report prepared by Ms Young, an accountant engaged professionally by the Respondent and which the parties ultimately accepted as the Court expert to assist on these matters. In addition the credibility of the parties was also significant in resolving those difficulties.
Concerning the Applicant; in the cross examination of him the Respondent’s Counsel sought to make something of a conviction and Court order made in the Waverley Local Court some years ago in respect of an assault committed by the Applicant upon the Respondent. In the course of his cross examination the Applicant quite candidly admitted that he had been “charged” $500.00. Likewise in the course of the cross examination he openly admitted to his completion of the statutory declaration dated 3 June 2004[4]. He stated that the marriage had been a stressful marriage and one where he had suffered belittlement and felt the need to sign the statutory declaration under duress. These adverse admissions, whilst ameliorated by his allegations of duress, were openly and willingly provided.
[4] Affidavit of Respondent filed 4 December 2006, Annexure ‘E’.
I formed the view by reason of the Applicant’s demeanour and in particular his willing concessions in respect of matters which may have been damaging to his case or personally embarrassing that the Applicant did attempt to provide and did provide honest answers to questions put to him. Perhaps the Applicant’s somewhat innocent concessions were premised upon his subsequent evidence that the reason he was prepared to sign a statutory declaration at the time was because he was not concerned about he being disadvantaged by that conduct. However, as he said, he would never have signed the statutory declaration if he was concerned about the unaccounted funds he later became aware of. It was only after he became aware of the unaccounted funds that he sought to cavil with the intent in that declaration. The Applicant’s explanation had the hallmarks of an honest explanation and the manner in which he delivered his evidence was consistent with an honest expression of the relevant facts. Likewise the Applicant made honest and reasonable concessions concerning contributions that were made by the parties to the marriage. He agreed for instance that the Respondent “worked like a Trojan”. In fact he accepted that her percentage of the combined effort particularly while the children were undergoing schooling was about 70%. Likewise he made similar concessions concerning a period in his life when his personal circumstances and that of his family were adversely affected by his drinking and gambling.
In the cross examination of the Respondent she frequently sought to respond to questions with questions and evaded directly answering questions. She expressed a “tit for tat” attitude. On a number of occasions her reply to any particular question involved an assertion to the effect that why should it matter because the relevant point had been the Applicant’s approach. She did not appear as a cooperative or forthcoming witness.
Relevant to financial matters she particularly was cross examined about two matters concerning financial transactions.
First, a sum of $360,000 had been deposited into the Commonwealth Bank account (the 1927 account)[5] which were alleged to be the proceeds of the sale of the Pinnacle apartment[6]. She said that an entry in the bank statement for 5 September 2005 of $12,000 constituted a deposit of $11,000 provided to her by Mr Beaston who was the manager of the body corporate and a $1,000 sum which she had withdrawn from her St George account. They were joined together and deposited as that deposit of $12,000. She says she physically attended the bank and deposited those monies.
[5] An account which is referred to in the list of discovered documents and at paras 84 and 96 of the Applicant’s affidavit filed 4 December 2006 but not identified in the Spreadsheet.
[6] Whilst the Respondent submits this inference should not be drawn it is in my view appropriate to draw this inference. No other source of the fund was identified and the moneys broadly equate with the money one would expect to receive on the settlement when an allowance of $20,000 is made for the marina (sold separately) and 10% deposit which would ordinarily be held by the agent ($400,000 – 40,000 = $360,000).
Subsequently she withdrew a sum of $10,000 as part repayment of a loan for $70,000 borrowed to pay the judgment of the first hearing. At about the same time she withdrew $150,000 from the 9199 account and had the sum placed in a vault in the bank. As I understood her evidence the physical sum of $150,000 was withdrawn, counted and placed in a vault. Subsequently a further sum of $210,000 was withdrawn in cash and it too was placed in a vault. All up the total cash withdrawals totalled $360,000.
Subsequently part of those funds were paid into a term deposit at the Commonwealth Bank (see exhibit 6). The value of the term deposit was $360,000. That should have left no cash sitting in the vault.
However, when cross examined about this source appeared to be relied upon for the payment of lawyer’s fees by the Respondent. When further questioned about this the Respondent conceded that she did not pay that sum to her solicitor but rather that it was for the payment of her solicitor and other sundry expenses.[7]
[7] None of this can be related directly to the transactions recorded in the accounts of account 1927. Broadly deposits and withdrawals of $360,000 can be demonstrated but they did not fit neatly with the evidence.
At first blush it was apparent from the question asked and the answer which was given that the impression sought to be conveyed by the Respondent was that the $30,000 was expended on legal expenses. The Respondent was then questioned concerning the source of funds for the deposit which she paid on a new apartment. She stated that the deposit of $31,500 came from the monies in the vault.
When taken through the arithmetic exercise of adding the additions and substractions to monies placed in the vault it was obvious that the deposit could not have come from that source if the other payments alleged had been made. It was put to the Respondent that the deposit fund had come from some other account. That matter was denied by the Respondent. Quite clearly the Respondent is mistaken about the source of those funds.
Even accepting that she was mistaken to the extent that she paid monies from the bank vault to her lawyers and for sundry other expenses a sum of $31,500 in cash could not have been withdrawn from the bank vault. There simply were not the funds there. (See various balances over time in both accounts 1927 and 1935 being the accounts between which funds were transferred). I do not accept the Respondent has a reliable recollection of these matters.
Putting aside concerns I already have about her evidence relating to what appeared to me to be an obvious attempt to inform the Court that $30,000 had been paid by her to her lawyers from that source when in fact it had not, the stark fact remains that after the withdrawal of the funds from the term deposit there was not $31,500 left in the bank vault which in turn could have been called upon to pay the deposit as alleged. Clearly there must have been another source of funds available to the Respondent if it is accepted those sums were paid (as I do).
There were other curious aspects of the Respondent’s financial conduct which occasioned concern. For instance it is sworn by the Respondent that shortly after judgment following the first trial she received a sum of $14,000 in cash from an old boyfriend who she happened to run into at about that time. The alleged boyfriend was one she had not seen for many years and her meeting with him was said to be by happenstance. It seems that following a brief conversation and a cup of coffee the former boyfriend took pity upon her and was then moved to lend her $14,000. Putting aside the curious circumstances surrounding that generous offer and the fact that the boyfriend then provided $14,000 cash to the Respondent without security, the Respondent then proceeded to draw fourteen $1,000 postal orders in respect of that cash.[8] This whole series of transactions had a highly suspect air about it particularly given that within a matter of days after that event the Applicant had lodged a Notice of Appeal and in the meantime the parties were agitating over costs in respect of the hearing at first instance. The acquisition of postal orders occasions suspicion that source funds for them was cash held by the Respondent if I do not accept the benevolent ex-boyfriend’s story which I do not.
[8] A review of the Australia Post money orders, affidavit of the Applicant filed 4 December 2006, Annexure BC-5 demonstrates four (4) of the money orders were drawn down on 22 November 2005 and the balance on 13 November 2005.
Furthermore there was a further sum of $7,000 which appears to have been curiously accounted for in respect of a loan made to her by her younger brother, Bruce Ian Hughes. In an affidavit sworn by him (exhibit 5) he said that in September 2006 upon the sale of her unit at the Pinnacle the Respondent paid to him a sum of $40,000[9]. That sum was already made up of $33,000 by way of repayment of an earlier advance by him plus “$7,000 to hold in case she needs it”. Whilst the payment by the Respondent to her brother of $33,000 may appear quite legitimate in context of a dispute between the parties concerning their property matters, particularly after an order of the Full Court directing the matter be remitted for retrial, the overpayment of $7,000 has all the hallmarks of a payment made with the intention of concealment. In any event another curious feature of this transaction is that the indebtedness to the brother was first raised in the proceeding only at the second trial. No earlier indication of that debt appears in the Respondent’s material, and in particular, is not noted in any of her statements of financial circumstances even if it be the case that the debt arose after the first trial. I do not accept such indebtedness existed and do not allow for it in my calculation of the property pool.
[9] See settlement statement attached to Exhibit 2.
Other features of the Respondent’s handling of financial matters occasion concern. The Applicant vociferously complained that there had been inadequate disclosure by the Respondent of her relevant banking records. The Applicant by his Counsel contended that neither the Applicant nor his advisers had knowledge themselves of those matters and accordingly were entirely dependent upon the Respondent to make adequate disclosure of those matters. Indeed it transpired that following the initial hearing and the subsequent review on appeal the accountant engaged by the Respondent to prepare a financial analysis for the purpose of these proceedings uncovered two further accounts. In addition there were also the Commonwealth Bank accounts. When one has regard to the quantum of funds passing through those accounts and in particular to the Respondent’s evidence concerning her conversion of those funds into cash and the placing of those funds in the vault in the St George Bank the basis for the Applicant’s concerns were properly founded, in my view. I remain concerned that the Respondent has failed to fulfill her obligations of disclosure. Accordingly in my consideration of issues relating to funds alleged to be unaccounted for from various bank accounts a robust view should be taken of the evidence consistent with the approach sanctioned in those circumstances in Weir and Weir[10].
[10] (1993) FLC 92-338.
I was not impressed by the Respondent as a witness. As I have earlier noted she was evasive, non responsive and argumentative in the delivery of her evidence. Matters which should have been disclosed were clearly not disclosed at an appropriate time. On other occasions her evidence was demonstrably unreliable by reference to the objective facts. I have no confidence that she informed the Court of all matters that she ought to have informed the Court of. Indeed in cross examination it was apparent that her approach to disclosure was to provide that material which she thought the Applicant would want as opposed to providing all that the Applicant was entitled to. Whilst perhaps that may be a matter which has some basis with the advice she received from her solicitors I do not accept that such an approach could have been reasonable in relation to the later accounts identified following the first trial. I do not accept that the Respondent was a reliable witness and where her evidence departs from that of the Applicant it has been rejected.
In this action the Applicant’s principal contention is that a sum of $90,000 which ought to have been available to the pool cannot be accounted for. For her part the Respondent says the money was spent in the course of the high living of the parties during the course of the relationship. The Applicant says the funds have simply been secreted by the Respondent.
The accountant Michelle Young attended and gave evidence at the trial. She informed the Court that she accepted the spreadsheet which had been prepared by the Applicant and was Appendix 2 to the affidavit of the Applicant filed 2 March 2007 (the Spreadsheet). She said that in view of the recent information provided to her concerning account numbers 9199 and 5546 she was able to account for all transactions in the Spreadsheet save for one transaction for the sum of $14,000 which she identified[11].
[11] See spreadsheet page 3 of 9.
In cross examination she was referred to the Applicant’s affidavit filed 2 March 2007 and in particular to paragraphs 83 and 114. Whilst she noted that she could not comment upon household expenditure she stated that in her first analysis (exhibit 1) she did not include sums of $67,849[12], $98,213[13], $16,400[14] and a sum of $1,300[15] which sums constituted payments made by the husband to the matrimonial pool on account of redundancy and superannuation payments. Those omissions totalled $183,762. The basis for her initial exclusion of those items was an instruction from the Respondent’s original solicitor, Mr Toogood, that the sums had been expended on living expenses.
[12] The Spreadsheet page 1/9 (entry noted for 1/6/99).
[13] The Spreadsheet page 4/19 (entry noted for 20/9/02).
[14] The Spreadsheet page 4/9 (entry noted for 1/8/02).
[15] The Spreadsheet page 4/9 (entry noted for 31/7/02).
In the final analysis she said that overall the figures remained the same because one figure offset the other, that is, Ms Young says that she was instructed that the $190,000 combined redundancy etc was consumed as living expenses over time, namely four to five years. She stated that on the basis that the $190,000 had been paid into her joint account and consumed over four to five years it was treated as disposable income received by the parties. In that sense there was an offset. Generally she noted that the household expenses presented a very confusing statement of the overall management of the household accounts.
Accepting the spreadsheet as the starting position it is apparent from the balances in each account contained in the Spreadsheet the sum of $89,990 remains unaccounted for[16]. In adopting this approach the underlying premise is that irrespective how many accounts may be opened and how many internal transfers might occur, if all transactions are internal the net outcome will remain the same given a fixed starting balance. The final balance should only be affected in a net sense by incomings and outgoings. If all the recorded incomings and outgoings are capable of identification then any disparity between the opening and closing balances will reflect unrecorded transactions (whether they be debit or credit entries).
[16] The Spreadsheet records transactions in 15 accounts (by reference to the various accounts identified in the 15 columns). If each of the first 11 accounts (which are the Applicant’s accounts and joint accounts) is then in turn totalled, the following represents the state of account balances as at 8/1/05:
Account No. Debit Credit Balance 1623 0 0 6822 2,700 2,700 DR 7531 26,232 23,532 CR 9609 0 23,532 CR 1146 5,000 18,532 CR 1748 0 18,532 CR 2070 0 18,532 CR 4041 0 18,532 CR 5272 39,295 20,763 DR 5530 19,179 39,942 DR The Spreadsheet identifies the balances of the newly identified accounts (which are solely the respondent’s accounts), being the last 5 columns. The account balances for 8/1/05 based upon recorded entries are as follows:
Account No. Debit Credit Balance 4909 2,627 2,627 DR 3407 23,127 25,754 DR 5257 7,097 32,851 DR No account number 17,197 50,048 DR To obtain these balances, one must undertake the arithmetic exercise of totalling all debit and credit entries in the respective accounts. I would have been greatly assisted in this task if the parties had either provided me with the Spreadsheet in electronic format or had the task undertaken by the accountant at first instance. Overall the combined total of all accounts $89,990 being $39,942 DR and $50,048 DR.
The only additional factor in this case is that the Spreadsheet only records “significant transactions” i.e. those over $5,000. However as earlier observed the parties all appeared content with this. I assume they accepted that over time the ebb and flow of small transactions would balance out and not adversely affect the final outcome.
Before examining the application of funds by each party and considering whether particular allowance needs to be made for or against any party the question of the general state of matrimonial accounts has to be first addressed.
An attempt at reconciling the banking accounts of the parties was first undertaken in June 2005 by Michelle Young. Ms Young is a public accountant. Although at that time she had only had approximately 18 months experience in private practice she had prior to that time 18 years experience in the Australian Tax Office particularly in audit. Her experience with the Australian Tax Office in audit would more than amply have prepared her for the forensic task set by the Respondent and undertaken by her in respect of her retainer.
She noted the purpose of her retainer was “…to undertake an analysis of transactions of money of many different bank accounts with supporting documentary evidence so that answers could be ascertained (sic) in relation to transferees and expenditure.”
When Ms Young first reported in June 2005 (prior to the first trial) she particularly observed
“I have further undertaken an analysis of the significant income and expenditure that has occurred during (the parties’) relationship. The purpose of this analysis was to ascertain whether it could be said that the monies had been misappropriated to any degree.”
It is curious to note that at that time Ms Young concluded that “the end result is all monies have been completely accounted for and the majority are supported by documentary evidence…”.
I make that observation because of the earlier statement by Ms Young which was confirmed by later events that she considered there was an account missing. More importantly the account allegedly was for a sizeable amount being approximately $90,000. This observation is made despite Ms Young’s observation that she traced only “significant expenditure” which means the Spreadsheet has not sought to deal with expenditure less than $5,000. In broad terms she and all parties appeared comfortable with this approach, and no doubt the attendant risk associated with it.
In her later affidavit (filed 10 December 2006) she restated (paragraph 7) her view that as at January 2005 she considered there was an account missing and the basis for her view. I accept her explanation in that regard.
She proceeded to explain that these omissions had been addressed by the provision of further information by the Respondent. In her letter, annexure D she stated,
“…St George have now provided copies of statements for account 148295754 which is a joint account and it covers from 14/2/01(opened) until 25/7/01(closed). The bank statements show that the amount of $485,363.69 was transferred to this account. Later on the same day the amount of $484,863.69 was transferred to another account. This second account has not yet been located.
During the period that this account was opened money was transferred back into this account from the missing account … (totalling $495,100)”.
In her initial report of 15 June 2005 Ms Young concluded that the sum of $90,261.35 could not be accounted for. She reached this conclusion because account number 2070 closed on 14 January 2001 with a balance of $485,363.69 being withdrawn. No account was opened elsewhere to which the money appeared to have been deposited. The next account to open was account number 1748 which opened on 30 July 2007 with a balance of $395,102.34.[17] The difference between these accounts was $90,261.35.
[17] Affidavit of Michelle Leah Young filed 1 December 2006, Annexure ‘C’ (ltr 22 July 2005, p3).
Given that during this period the parties were engaged in the construction of the Underwood dwelling and no withdrawal appears for the land or progress claims for the construction she expressed the view that the missing $90,000 could be accounted for by expenditure on those matters.
Although Ms Young stated in her initial report of 15 June 2005 that the expenditure of $485,363.69 and the $90,261.35 can be accounted for such is not apparent from the Spreadsheet which she accepts records the financial dealings.
For instance it was said by Ms Young from her detailed analysis commencing at the fifth page of Exhibit 1 that the construction costs (excluding land) total $342,742.00. A sum approximating this figure was withdrawn from SG5757. That sum made no allowance for the land purchase. Subsequently a sum of $159,319 was transferred from SG5757 to SG4909. An additional $17,963 was deposited to this account. Relevantly from this amount sums totalling $52,945 were withdrawn which probably related to furnishings.
Subsequently the sum of $101,051 was transferred to an unknown account, possibly account number 5546 but remains unaccounted for.
Counsel in their cross examination and submissions made no reference to these matters, or indeed any matter relevant to the amount at all.
In this case I am satisfied the Applicant has indeed engaged in conduct of the kind complained of. However I can only act upon evidence and within the bounds of what an educated lay person may do in terms of drawing inferences, particularly from incomplete and unsatisfactorily presented accounting evidence although more correctly the matter pertained to bookkeeping of a basic kind[18].
[18] Ms Young commented that the exercise was not one requiring expert accounting opinion but was simply an exercise in the collation of information and documentation. See Affidavit of Michelle Leah Young filed 1 December 2006, Annexure ‘C’ (ltr 22 July 2005, p3).
However apart from her observations Ms Young’s evidence was useful for comparative purposes against the Respondent’s evidence. From the above it appears that $342,742 was spent on particularised items which were assumed by Ms Young to relate to the Underwood property. However that is difficult to reconcile with the other evidence in this case.
At paragraph 66 of her affidavit of 4 December 2006 the Respondent said the cost of the Underwood property was $382.000. In her later affidavit of 5 March 2007 at paragraph 10 she says those costs equated to $352,742[19].
[19] Total cost as per paragraph 10 was $435,242 less $82,500 for …. leaving total construction costs at $362,742.
Upon this basis it would appear up to $30,000 difference appears in respect of the construction costs over this time. No explanation is provided by the Respondent for this variation. As discussed above generally these transactions have not been undertaken in a transparent manner. The Respondent has produced only limited objective material to support her assertions.[20] The later affidavit has been introduced to address a complaint by the Applicant that $90,000 remains unaccounted for. In those circumstances it is appropriate that some effort ought to have been made to justify and provide explanation of the increased expenditure particularly when it has increased so significantly.
[20] The annexures referred to in Exhibit 1 seek to verify matters by reference to photographs and oral claims: pool; pool fence; wall; patio; tiles; computer; radio and alarm – claim $66,150. In addition there appears to be a double claim in respect of furnishings.
Given that this sum was deposited into an account controlled by the Respondent it is incumbent upon her to demonstrate how those funds were deployed and to explain those matters.
The manner in which the Respondent maintained accounts itself raises serious questions about her overall accounting. As I have earlier noted, prior to the last trial there were vociferous complaints by the Applicant through his solicitors and Counsel about the adequacy of disclosure. Their concerns in respect of that matter were well founded as later events demonstrated. It appears that it was only after complaint and pressure that the two later accounts now evidenced in the spreadsheet were identified (at least in part) for an acquittal of some of the transfers.
From the Spreadsheet it would appear that at least 10 (and possibly more) accounts were operated by the Respondent either solely or jointly with the Applicant. However what is particularly curious is the manner of their operation.
For instance account 5757 (first disclosed after June 2005) demonstrates a series of deposits for various sums between 12 April 2001 and 3 July 2001 totalling $495,100. The source of the deposits is not identified. It is further apparent that a sum of $342,887 was then withdrawn from that account on 15 June 2005. On page 2 of 9 of the spreadsheet, in the last four columns, the transactions of the new accounts are recorded. As recorded they do not make a great deal of sense. The deposits total $495,100[21]. However two withdrawals total $502,197[22] suggesting there must have been an opening balance of $7,097 representing an initial opening balance to permit such withdrawals. Matters are further confused because the sum of $502,197[23] equates with the sum noted as withdrawn in the last column. However account number 5757 shows an identical amount split across two withdrawals. The first withdrawal is for the sum of $342,887 and the second is for a sum of $159,310. Whilst the sum of $159,310 ultimately landed in account number 3407 no final repository for the sum of $342,887 is identified. Given this account appears to have been a clearing account of sorts related to the Underwood construction it was probably withdrawn to reduce a balance somewhere else. This matter was not explored by any party with any witness. Significantly those two sums total the $502,197 noted in the account.
[21] This figure represents the sum of all debit entries for account SG5757 between 25/2/01 and 4/7/01 on pages 1 of 9 and 2 of 9 in the Spreadsheet.
[22] This figure is the sum of the two credit entries for account SG5754 made 5/7/01 and 15/6/05 entered on page 2 of 9 in the Spreadsheet.
[23] This figure appears in “Missing Account” credit column for 4/6/01 on page 2 of 9 of the Spreadsheet.
The sum of $159,310 was withdrawn from account number 3407 and transferred to account number 4909[24]. No explanation is provided for this transaction. Subsequently on a date which is not identified that account was drawn upon leaving a balance of $101,301 that was transferred from account number 4909 to account number 5546. It is apparent that account number 4909 was also used as a clearing account because there is evidence of later entries in respect of that account including a transaction on 14 November 2001 (page 2 of 9 of the Spreadsheet) when $15,250 was deposited into account number 4909 from account number 5546 and subsequently withdrawn.
[24] See entry at page 2/9 of the Spreadsheet for 4/6/01.
This transaction particularly would have engendered suspicion because the origin of the funds was account number 5546, an account operated solely by the Applicant[25]. If the Respondent had not been concerned to conceal the true state of her financial affairs it would reasonably be expected that she would have directed, as a transfer, the transfer directly into the account to where it appears as funds subsequently transferred on that same day.
[25] Whilst evidence was given of this account it was not featured in the Spreadsheet.
Likewise a series of transactions appears on page 3 of 9 of the Spreadsheet concerning the sum of $14,000 deposited into account number 4909 in December 2001 raises suspicion. The evidence was that the origin of that sum was account number 6909 and in due course the sum was withdrawn by transfer to account number 5546. Concerning the sum of $14,000 transferred in January/February 2002 it was transferred from account number 5546. Ms Young did not know where this sum was transferred to.
Further the sum of $34,200 was transferred on 2 May 2002 into account number 4909. It came from account number 5546 through account number 4909 and was employed as the deposit on the Pinnacle apartment.
Finally a sum of $200,000 arrived into account number 4909 on 21 June 2006 from an unknown source and then was subsequently on-transferred to account number 5546.
The gratuitous nature of transfers of these funds is puzzling. If the Respondent intended to create confusion and ambiguity in respect of her financial dealings she undoubtedly succeeded. Certainly no one at trial bothered to inquire as to the curious nature of these transactions.
A natural consequence of these dealings was the suspicion created in the Applicant’s mind concerning her dealings. In my view his basis for suspicion was well justified.
No doubt the Respondent would say that her decision to transact matters in this manner was a reflection of her economic status and separation from the Applicant. For instance she swears that the marriage has largely been a sham and that she and the Applicant have lived separately and apart for most of it. She swore that she continued to live with the Applicant principally for financial reasons.
If that is the fact it is somewhat odd that the Applicant himself did not seem to consider that he had commenced living separately from the Respondent until about mid 2004[26].
[26] Applicant’s affidavit filed 4 December 2006 at paragraph 15. Note also the Applicant’s continued notation of the Respondent as the preferred beneficiary for benefits under his super fund.
Whilst the Respondent may receive some support from the recital to the deed dated 11 June 2004 the facts of their relationship paint a slightly different picture. Despite the so called deteriorated and loveless relationship, the parties decided to relocate together from Sydney to Brisbane and upon arriving in Brisbane embarked upon the venture of constructing a house in which they subsequently lived. They later purchased another property that they lived in together and shared rental properties. Whilst I appreciate the force of the argument that this was done principally for the benefit of their children who were then late adolescent teenagers the objective facts do not tend to support the Respondent’s assertions that the parties were truly separated. I accept the Applicant’s evidence in relation to the state of the relationship and the time of termination in preference to that of the Respondent.
In summary the bookkeeping by the Respondent has been conducted in a confusing manner. All the relevant material has not been worded in a form readily digestible by the Court. Counsel for both parties simply ignored the manner despite the case principally being conducted on the basis that the Respondent has by improper means syphoned off funds to her own advantage.
Much of the debate in submissions has referred selectively to a limited number of transactions in respect of discreet sums. Given that in most cases no “entry” or “exit” point for the source funds of many of the transactions can be identified the reference to the various transactions has had limited utility. They have however highlighted the curious and ostensibly suspicious nature of dealings, particularly when considered against a background of complaints relating to syphoned off funds.
Although it appears the Respondent may have applied $100,000 to her own benefit the evidence is too vague for me to be satisfied that the money did not find its way back into the accounts. If the parties had wanted such a finding then it should have been prosecuted their examination of the accounts much more vigorously.
However I am satisfied that the sum identified at paragraph 50 approximating $90,000 is accountable to the property pool. I was informed that at the last trial the Respondent in fact conceded the amount of $56,002[27] was the cash balance of accounts. No doubt the Respondent was keen to concede this sum. However her concession of that balance itself was flawed because an examination of credit and debit entries for account SG5272 leaves a balance of $39,295 not $56,002. Clearly other funds had been debited to and credited from that account and which were not recorded. I do not think the respondent knows how much cash was on hand. However I am satisfied it exceeded the sum she conceded and adopt the total of the unaccounted for funds as representing the $90,000 of funds identified in paragraph 50 above together with the $14,000 Ms Young was unable to account for (see para 47). I estimate the sum of $104,000 should be allowed to the property pool on account of missing funds.
[27] Spreadsheet p9/9, account SG5272.
Given my findings concerning the use of accounts and handling of money I do not accept the Applicant has engaged in any conduct to secret or otherwise diminish the matrimonial pool as the respondent has. I dismiss her complaint that the Applicant has received $206,300 and not accounted for this sum or indeed any other sum as is discussed below.
Loan to brother
At paragraph 63 of her affidavit the Respondent alleges that the Applicant made a loan to his brother, Rodney Chambers, of $50,000. However nothing in the accounts contained in the Spreadsheet appears to verify any such withdrawals. In any event it is unlikely to have occurred because the balance of any account solely in the name of the Applicant as noted in the Spreadsheet only ever varied from between $0 on 1 August 2001 and $16,820 on 8 November 2002 (see account number 1623). None of the Applicant’s other accounts, being account numbers 6822, 7931 and 9609 otherwise ever had any other than nominal balances in them. No entry in any of the joint accounts supports a withdrawal of such a sum at or about the time alleged. Larger deposits received by the Applicant such as the proceeds of superannuation benefits are also all otherwise accounted for.
I do not accept any such transaction occurred.
Add Backs
The Respondent contends five particular sums ought to be taken into consideration as add backs.
a)$20,000 she alleges the Applicant received on the sale of Coogee property;
b)$62,500 redundancy payment;
c)$48,474 received from the sale of Edgewater Gardens;
d)$150,006.50 transferred by the Respondent to the Applicant for the purchase of the Coombabah unit; and
e)waste associated with Applicant’s gambling.
Coogee Beach
The Coogee property was sold in early 2002. Nothing appears in the Applicant’s accounts to indicate the sum was paid solely to his benefit. It otherwise falls within household income and insofar as it no longer exists is either merged into the funds of the household or has been converted to the benefit of both parties. No specific allowance should be made in favour of the Respondent in respect of this matter.
Redundancy payout
The Respondent contends that the Applicant received a redundancy payout of $62,500 and that that ought to be the subject of a specific allowance.
The sum of $67,848 was received by the Respondent on 1 June 1999 by way of a redundancy payout from his employment with the RSL. The detailed analysis of the accounts commences from 17 June 2000. The opening balance of the cash management account number 2070 at that date is recorded at $54,142. There is no other sum of capital sufficient to charge the account to that extent otherwise identifiable. It seems more probable than not that the sum of $67,849 received by the Applicant approximately twelve months earlier was in part the basis of that opening balance[28].
[28] The only other possible source were the sale proceeds of the King Langley property. However those funds appears to have been reinvested into the acquisition of the Coogee property.
In the premises I consider that the redundancy payout was paid by the Applicant to the benefit of the Applicant and the Respondent and the joint matrimonial account and there should be no specific account for this matter.
Edgewater Gardens
It is contended that allowance should be made for the sum of $48,479 being a sum that the Applicant received on the sale of the Edgewater Gardens property. From the Spreadsheet it appears that a sum of $48,479 was deposited to account number 6822 on 14 November 2003[29]. This appears to correspond with the Edgewater Gardens transaction. The Applicant did indeed get the benefit of this. In making this finding it should however not be forgotten that the Edgewater Gardens transaction involved the division of the proceeds to then permit the Respondent to acquire the Pinnacle unit. It can be seen from a review of later transactions in the Applicant’s account SG6822 that a deposit of $145,105 was made at about the time of the purchase of the Coombabah property. Accordingly it can be concluded the Applicant has expended a significant part of the $47,000. However given he had returned by that time it would be reasonable to expect some of those funds would have been applied to living expenses over the last four years or $12,000 per annum. In my view no add back is appropriate. Accordingly those sums are now incorporated into the property pool by their recharacterisation. The sums have not been dissipated but merely changed their character. There does not appear to have been any material change in a balance sheet/net equity sense.
[29] Spreadsheet entry p7/9 – 14/11/03 account S66822 – see also entry account SG5272 - $194,204 (for Respondent)
I make no allowance for this item.
Husband’s Gambling
In her affidavit at paragraph 61 the Respondent asserts that the Applicant had a gambling habit and that by reason of his habit he was responsible for considerable waste of matrimonial assets.
The Applicant admitted the instances complained of in paragraphs 57, 58 and 59 of the Respondent’s affidavit. However save for that instance referred to above none of the other events appear to be capable of quantification. Whilst I note the report of Ms Young makes reference to a series of withdrawals which are suggestive of “impulsive behaviour” Ms Young is not qualified to express any such opinion. Any number of explanations could arise for the withdrawals which were referred to in her statement and I do not intend to speculate upon those matters.
Whilst I am prepared to accept that there were isolated instances through the course of the marriage where the Applicant appears to have engaged in conduct which constituted an unreasonable waste I assess those matters on the basis that they were limited.
It was urged upon me by the respondent to make some greater allowance and indeed to make an adjustment at the s79 contribution or s75(2) stage. I do not think it is appropriate.
Aside from the transactions specifically identified no other evidence supports the contention that the gambling went beyond hobby “punting”. There was no evidence of serial punting demonstrated by evidence of a TAB account or similar. Given the deep bitterness extant between the parties and my poor opinion of the respondent’s veracity I do not accept her complaints.
I assess waste on account of gambling at $27,600.
Coombabah property
The Respondent provided a further sum of $145,006 to assist in the acquisition of the Coombabah unit.
As with Edgewater Gardens this matter merely reflects the change of character of assets from one form (cash) to another form (real property). Although in this case it appears the asset has diminished in value the conversion of the asset has not had a balance sheet impact.
Concerning the diminution of its value the Coombabah unit was not purchased unreasonably or capriciously. There have obviously been market movements since the time of acquisition. I do not regard that there has been any element of waste which should be brought to the Applicant’s account.
I make no allowance for this item.
Costs
Legal costs have been incurred by each party. The Applicant’s evidence was of an expenditure of $34,250. The Respondent has expended at least $30,000. Unfortunately precise expenditure to trial was not provided. It might be that costs expenses have been incurred but not yet paid.
I adopt the figures above and the respective proportion of the parties. Such costs ought be included as an add back in the matrimonial pool.
Payment of earlier Judgment
Following the judgment at the initial hearing a sum of $70,000 was paid by the Respondent to the Applicant. It was conceded by the respondent in submissions that a sum of $34,250 was disbursed from that sum to pay the Applicant’s legal costs. The sum of $70,000 ought be “allowed”. However as it was paid by the Respondent following the initial judgment it should be accounted for at this time by declaration from any sum by the Applicant to the Respondent. In effect it constitutes an advance payment on judgment.
Disclosure
In her affidavit at paragraph 90 the Respondent says that there is no substance to the allegations that she has “stashed” funds somewhere. I am however satisfied that the Respondent has not been fully cooperative in respect of the matter of disclosure. I have related relevant instances earlier in this judgment and where necessary drawn appropriate inferences as circumstances required.
Summary of Findings Concerning the Property Pool
Proceeds of Pinnacle and Marina $417,500
Coombabah House $135,000
Motor Vehicle – Applicant $7,500
Motor Vehicle – Respondent $6,425
Respondent’s Hair Salon $10,000
Chattels – Applicant $5,000
Chattels – Respondent $0
Superannuation – Respondent $31,932
Shares – Respondent $0
Cash held by brother $7,000
Undisclosed funds:
- unaccounted for in Respondent’s $50,048
accounts
- unaccounted for by account $14,000
- cash on hand – joint accounts $39,942 $104,000
$727,357
Add backs:
Husband’s gambling $27,600
Net Pool $751,957
Contribution
In this case each party has sought to minimise the contribution of the other. In a bitter dispute, as this one has been, so much is to be expected.
The parties met in 1977, lived together for a short time then married on 24 October 1981. There were two children of the marriage. They were born in 1982 and 1986. The parties separated finally in 2004. There have been two periods of short separation between the course of the marriage, one in 1997 and another in 2000.
In broad terms given the relative financial status of each party prior to the marriage the general direct and indirect contributions of each party throughout the marriage and the overall length of the marriage, the case suggests a 50/50 split of assets upon conclusion of financial relations between the parties.
In each instance however, each of the Applicant and the Respondent contend for a division of property in their respective favour of 60/40.
The Respondent contends the Applicant’s allowance to contribution should be reduced because:
a)she brought more assets into the marriage at the outset;
b)the husband engaged in waste throughout the marriage by reason of an alleged gambling habit;
c)the parties were unhappily married and lived together separately for a significant period of time; and
d)the husband was generally guilty of waste throughout the marriage with acquisition of unnecessary extravagances such as motor vehicles, a suit and fine wine.
Likewise the Applicant says there should be a reduction of the Respondent’s contribution because of assets she introduced and periods of separation.
Assets Introduced
The wife says she brought into the marriage a motor vehicle and $18,000. The Applicant had little by way of financial resources at the time of marriage. From the Respondent’s material that sum appears in part to have come about from work as a skater and participation as an extra in a cinematic production. The windfall appears to have been short-lived and does not appear to have been a reflection of the Respondent’s general earning capacity. Meanwhile the Applicant appears to have engaged in employment and been promoted throughout his employment.
The sums introduced by the Respondent were not overall significant sums. In my view her entitlement to have specific recognition of those sums merged into the assets of the marriage a long time ago.
This is particularly as the Respondent admitted that she and the Applicant “ran down” the savings on travel and having a good time. It could not be said, for instance, that the sum remained identifiable as part of an asset or body of assets in respect of which the sum could be said to have provided seed capital.
Of the cash the Respondent said she only had a small sum available as a deposit for the parties’ first property acquisition. That property itself could not be identified as a source of subsequent wealth in the relationship as the parties from that point engaged in various acquisitions and disposals leading to the final property holdings at trial.
I make no specific allowance for the initial contribution but merely include the matter in the mix of matters to be considered in a global manner.
Periods of Separation
There were two periods of separation throughout the marriage. The first occurred in 1987 for a period of 6 to 8 months and the second occurred in 2000 for a period of 11 months.
The circumstances surrounding the separations require some consideration.
The first occurrence arose because of unhappiness between the parties. However following that separation the parties reconciled and their relationship continued. The event of separation does not appear to have had any significant impact upon their financial position.
The second occasion of separation appears to have had its genesis in difficulties between the Respondent and her son Jason. Given his age it seems the Applicant decided to take up accommodation at the Pyrmont unit whilst difficulties between the Respondent and Jason were resolved. It appears that at this time Jason was also involved in difficulties with the police. These difficulties generally appear to have precipitated the parties’ decision to relocate to Queensland. It is not entirely clear whether the separation was in truth a separation of the parties or whether indeed it was a separation of the parties for the benefit of Jason.
Apart from these matters there is no question that the parties have each made appropriate contributions, both financial and non-financial in the course of the marriage. Each of the Applicant and Respondent worked hard. The Applicant particularly acknowledged that the Respondent had worked hard. It was clear to me from the evidence that the Respondent was more “careful” of financial matters and that she regarded the Applicant as profligate with funds particularly after the events complained of concerning gambling. However the Applicant worked throughout the marriage. Towards the end of his working life he was in well paid employment in the club industry. His income was well in excess of that of the Respondent’s and his efforts appear to have been directed generally to the financial advancement of the marriage.
Other extravagant conduct
It is further alleged by the Respondent that the Applicant engaged in other extravagant behaviour including the acquisition of a motor vehicle, a suit and wine. None of those matters appear to have been extraordinary and the complaints made and comments passed by the Respondent are afforded the little weights they deserve in the circumstances in which they are made.
This was a marriage where both parties broadly contributed equally in both a direct and indirect manner. In all of the circumstances I consider it appropriate to apportion the matrimonial property pool 50/50.
Section 75(2) factors
In this case the Applicant is 65 and now lives in a relocatable home park and is in receipt of an aged pension. His capacity for employment is limited.
By way of contrast the Respondent is in her early fifties. She maintains an active business as a hairdresser. Although at trial she sought to diminish the value of that business, to accept her evidence at face value would suggest that she was working for less than the income that might be received by an apprentice. Whilst no doubt her business may not necessarily be extraordinarily profitable I assume that she acts in a rational economic manner and does not undertake the conduct of a business for something which is significantly less than the opportunity cost of her time were she to be employed in her capacity as a hairdresser elsewhere. No doubt if she works for less than she could elsewhere, she does so for reasons personal to her and ultimately because she can afford to do so.
Both parties claim to be affected by illness although it does not appear that either suffers from any significantly debilitating condition.
Having regard to the income property and financial resources of each of the parties, particularly after the division in accordance with the property settlement proceedings it is my view that the Applicant will be more disadvantaged than the Respondent into the foreseeable future. He is beyond retirement age and arguably has no residual employment capacity. The Respondent has at least six years or more if she so chooses particularly given that as a business proprietor she has a greater capacity to engage labour as the need arises.
Although some veiled effort was made to suggest that each of the parties have responsibilities in respect of their adult children it seems now that in view of the age of their children no allowance should be made on account of their party in respect of that matter.
I take into account the relevant living circumstances of each of the parties. Unquestionably the Respondent’s circumstances are far more attractive and appealing then those of the Applicant. Although the Applicant does not suffer an unacceptable standard of living it is apparent that there has been a diminution of the standard of living from that he formerly enjoyed. Meanwhile the Respondent will continue to enjoy a standard of living that appears to be at least reasonably commensurate with that which she previously enjoyed.
In all of the circumstances I consider an allowance of 5% should be made in favour of the Applicant on account of the Section 75(2) factors.
Just and Equitable
Finally the Court is required to consider whether in all of the circumstances it is satisfied that the proposed orders are just and equitable.
In my view having regard to the matters which I have identified earlier in this judgment concerning the relative positions of the parties in terms of contribution both indirect and direct and also their present circumstances following separation and divorce and after consideration of the capacity and needs of each in terms of future care a 55/45 split in favour of the Applicant is just and equitable.
Conclusion
In conclusion I find the property pool has a value of $751,957. The Applicant has an entitlement to 55% and the Respondent 45% being $413,376 and $338,381 respectively.
The Applicant has to account to the respondent for the $70,000 received following the earlier trial and which is not properly a pre-property pool calculation add back. After adjustment for that sum the respective entitlements are $343,376 and $408,381.
The Respondent wishes to retain his Coombabah property, motor vehicle and chattels which are valued at $147,500. Otherwise he must relinquish any claim to funds held in joint accounts.
Accordingly he is entitled to judgment against the Respondent for the sum of $195,876.00
I certify that the preceding one hundred and forty-four (144) paragraphs are a true copy of the reasons for judgment of Burnett FM
Associate: Bev Schmidt
Date: 17 September 2007
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