Clement & Clement
[2023] FedCFamC2F 1415
•3 November 2023
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Clement & Clement [2023] FedCFamC2F 1415
File number(s): PAC 1361 of 2022 Judgment of: JUDGE NEWBRUN Date of judgment: 3 November 2023 Catchwords: FAMILY LAW – PROPERTY – Just and equitable orders made. Legislation: Family Law Act 1975 (Cth) ss 75, 79 Cases cited: Eufrosin & Eufrosin [2014] FamCAFC 191
Lotta & Lotta [2017] FamCA 50
Division: Division 2 Family Law Number of paragraphs: 80 Date of hearing: 19–20 October 2023 Place: Parramatta Counsel for the Applicant: Ms R Druitt Solicitor for the Applicant: Caldwell Martin & Cox Counsel for the Respondent: Mr P Livingstone Solicitor for the Respondent: Marsdens Law Group ORDERS
PAC 1361 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MR CLEMENT
Applicant
AND: MS CLEMENT
Respondent
ORDER MADE BY:
JUDGE NEWBRUN
DATE OF ORDER:
3 NOVEMBER 2023
ON A FINAL BASIS THE COURT ORDERS THAT:
1.These Orders are made by way of alteration of property interests pursuant to section 79 of the Family Law Act 1975 (Cth).
Suburb C property
2.Within 60 days from the date of these Orders, the parties shall do all such acts and things and execute all such deeds, documents and instruments as may be necessary to list for sale and sell the property located at B Street, Suburb C (‘Suburb C property’) by private treaty for a sale price and a list price and with an agent to be agreed upon between the parties or in default of such agreement as to price for more than 14 days at a price determined to be a fair market price by the listing agent or their nominee whose decision shall be final and binding upon the parties, and the parties shall distribute the proceeds of sale in the following order and priority:
2.1In discharge of the National Australia Bank loan Account no. ending …33;
2.2In payment of legal costs, real estate agent’s commission and GST upon the said sale;
2.3In payment of any fees due for the nomination of a valuer and fixing of a price as hereinbefore provided, in payment of valuation fees, and GST, if any;
2.4In payment of municipal council and water rates;
2.5The payment of $560,175 to the Respondent Wife;
2.6The payment of $506,825 to the Applicant Husband.
3.That in the event that the Suburb C property has not been sold within three (3) months from the date it is listed for sale in accordance with Order 2 above, the parties shall forthwith thereafter do all such acts and things including executing all such deeds, documents and instruments as may be necessary to list for sale and sell the Suburb C property by way of public auction for a reserve price to be agreed upon between the parties or in default of such agreement as to price for more than 14 days at a price determined to be a fair market price by the listing agent whose decision shall be final and binding upon the parties on the following terms:
3.1That such auction take place within 4 weeks from the date of placing the property for sale by public auction or as soon as practicable thereafter, and that there be further auctions every 4 weeks until the Suburb C property is sold, with the reserve price to decrease by 5 per cent at each subsequent auction.
3.2That the parties shall jointly pay all auction expenses as requested by the selling agent as and when they fall due.
3.3That the parties shall do all such acts and things as may be necessary or recommended by the selling agent to properly present the Suburb C property for sale and to make it available for inspection by prospective purchasers.
3.4That either party shall be at liberty to bid for the purchase of the Suburb C property at auction.
3.5That the parties shall attend the auction and, if necessary, negotiate with the highest bidder at auction if the reserve price is not reached.
3.6That the proceeds of sale shall be distributed in the order and priority as set out in Order 2.
4.For the purpose of the sale of the Suburb C property in accordance with Orders 2 and/or 3, the following shall occur:
4.1The parties shall use their best efforts to reach an agreement as to the listing agent.
4.2In the event that there is no agreement as to listing agent within 14 days from the date of these Orders, then the Respondent Wife shall within a further 7 days propose the names of three (3) listing agents in writing to the Applicant Husband.
4.3Within a further 7 days from the Respondent Wife’s compliance with Order 4.2, the Applicant Husband shall nominate a listing agent and notify the Respondent Wife in writing of his nomination.
4.4The parties shall do all things and sign all documents necessary, including signing the listing agent’s agency agreement, to engage the agreed listing agent and continue to have them engaged pending the sale.
4.5That the Applicant Husband provide the listing agent with a copy of the keys for the home,
4.6That the Applicant Husband ensure that the Suburb C property is kept neat and tidy for all inspections and open homes.
4.7That the Applicant Husband allow access to the listing agent to visit the Suburb C property and allow inspections at all reasonable times at the request of the listing agent.
4.8That both the Applicant Husband and Respondent Wife be permitted to attend all open homes and auctions if they so choose but are restrained from in any way obstructing or interfering with the process or speaking negatively about the Suburb C property.
4.9That unless otherwise agreed in writing Caldwell Martin and Cox solicitors be instructed to act on the sale of the Suburb C property.
4.10That neither party be permitted to change the terms of the Standard Contract for Sale of Land or to the terms of the release of the deposit without both parties’ written consent.
Suburb E property
5.Within 60 days from the date of these Orders, the parties shall do all such acts and things and shall execute all such deeds, documents and instruments as may be necessary to list for sale and sell the property located at D Street, Suburb E (‘Suburb E property’) by private treaty for a sale price and a list price and with an agent to be agreed upon between the parties or, in default of such agreement as to price for more than 14 days, at a price determined to be a fair market price by the listing agent or their nominee whose decision shall be final and binding upon the parties, and the parties shall distribute the proceeds of sale in the following order and priority:
5.1In discharge of the National Australia Bank loan Account no. ending …08;
5.2In payment of legal costs, real estate agent’s commission and GST upon the said sale;
5.3In payment of any fees due for the nomination of a valuer and fixing of a price as hereinbefore provided, in payment of valuation fees, and GST, if any;
5.4In payment of municipal council and water rates;
5.5In payment of any arrears in council rates, arrears in water rates, or arrears in strata fees;
5.6In payment of capital gains tax of $69,256;
5.7In payment of $236,148 to the Respondent Wife;
5.8In payment of $135,596 to the Applicant Husband.
6.That in the event that the Suburb E property has not been sold within three (3) months from the date it is listed for sale in accordance with Order 5 above, the parties shall forthwith thereafter do all such acts and things including executing all such deeds, documents and instruments as may be necessary to list for sale and sell the Suburb E property by way of public auction for a reserve price to be agreed upon between the parties or in default of such agreement as to price for more than 14 days at a price determined to be a fair market price by the listing agent whose decision shall be final and binding upon the parties on the following terms:
6.1That such auction take place within 4 weeks from the date of placing the Suburb E property for sale by public auction or as soon as practicable thereafter, and that there be further auctions every 4 weeks until the Suburb E property is sold, with the reserve price to decrease by 5% at each subsequent auction.
6.2That the parties shall jointly pay all auction expenses as requested by the selling agent as and when they fall due.
6.3That the parties shall do all such acts and things as may be necessary or recommended by the selling agent to properly present the Suburb E property for sale and to make it available for inspection by prospective purchasers.
6.4That either party shall be at liberty to bid for the purchase of the Suburb E property at auction.
6.5That the parties shall attend the auction and, if necessary, negotiate with the highest bidder at auction if the reserve price is not reached.
6.6That the proceeds of sale shall be distributed in the order and priority as set out in Order 5.
7.For the purposes of appointing a listing agent to act on the sale of the Suburb E property in accordance with Orders 5 and/or 6, the following shall occur:
7.1The parties shall use their best efforts to reach an agreement as to the listing agent.
7.2In the event that there is no agreement as to listing agent within 14 days from the date of these Orders, then the Applicant Husband shall within a further 7 days propose the names of three listing agents in writing to the Respondent Wife.
7.3Within a further 7 days from the Applicant Husband’s compliance with Order 7.2, the Respondent Wife shall nominate a listing agent and notify the Applicant Husband in writing of his nomination.
7.4The parties shall do all things and sign all documents necessary, including signing the listing agent’s agency agreement, to engage the agreed listing agent.
7.5That the Respondent Wife is to request from the tenant that the Suburb E property is kept neat and tidy for all inspections and open homes,
7.6That the Respondent Wife use her best endeavours to facilitate access to the listing agent to visit the Suburb E property and allow inspections at all reasonable times at the request of the listing agent subject to the availability of the tenant.
7.7That both the Applicant Husband and Respondent Wife be permitted to attend all open homes and auctions if they so choose but are restrained from in any way obstructing or interfering with the process or speaking negatively about the Suburb E property.
7.8That unless otherwise agreed in writing Marsdens Law Group be instructed to act on the sale of the Suburb E property.
7.9That neither party be permitted to change the terms of the Standard Contract for Sale of Land or to the terms of the release of the deposit without both parties’ written consent.
F Company
8.That for the purpose of the transfer of real property referred to in these Orders (“the settlement”):
8.1Each of the parties will instruct their respective representatives to do all acts and things necessary to give effect to the settlement via F Company.
8.2In the event either party is self-represented at any time, then that party will nevertheless instruct a subscriber to the electronic conveyancing platform for the purpose of the settlement and will meet their own costs of the practitioner instructed by them.
8.3The parties will pay their own electronic conveyancing fees.
Belongings and Household Contents
9.That within twenty-one days from the date of these Orders, the Applicant Husband is to do all things to cause the following items to be made available for collection by the Respondent Wife (with the parties to agree on a collection date and time via their solicitors and within seven (7) days of the date hereof) and she shall have exclusive possession of the following:
9.1The Respondent Wife’s clothes, costumes, shoes and personal effects,
9.2All annual Santa photographs of the children,
9.3Fair share distribution of all family photographs available at separation,
9.4Jewellery gifted to the Respondent Wife and held in the home including in the safe,
9.5Cookware and kitchenware gifted by the Respondent Wife’s mother and grandmother as follows:
9.5.1Gravy boat
9.5.2Jug
9.5.3Cup and saucers set
9.5.4Baking tray
9.6Christmas tree, decorations, paper cut out displays and lights,
9.7Collection of approximately toy sets,
9.8Online belongings of the Respondent Wife that had been listed for sale and stored in suitcases and tubs in the shed of the former matrimonial home.
SMSF
10.That Orders 11 to 14 bind the parties as Trustee for the Clement Superannuation Fund (“the SMSF”).
11.That within 28 days the parties will in their capacity as directors of the Corporate Trustee of the SMSF cause the Corporate Trustee to do all things and sign all documents necessary to cause any asset or assets of the SMSF to be converted into cash at bank so as to give effect to these Orders.
12.The parties shall within fourteen (14) days following the sale pursuant to Order 11 above, do all such acts and things and sign all such documents as may be required, including but not limited to the signing of the SMSF trustee minutes, rollover requests and any related documents that may be necessary to transfer each of their respective Member Account balances and Member entitlements out of the SMSF and into another complying superannuation fund established by each of them in their respective names.
13.That for the purpose of giving effect to these Orders, each party will forthwith jointly instruct the SMSF accountant to do all things and prepare all documents necessary to give effect to these Orders and each of the parties shall forthwith provide the accountant with all documents and instructions necessary for them to undertake such task.
14.That simultaneously with compliance with Order 12 above, the parties as directors of the Corporate Trustee of the SMSF shall do all acts and things as may be necessary to wind up and close the SMSF and Corporate Trustee and to cause the said Corporate Trustee and the SMSF to pay all fees and taxes arising from such winding up in equal shares from each of their Member Account balances as and when payment falls due.
Other Orders
15.That within twenty-one (21) days from the date of these Orders, the parties shall do all acts and things and sign all documents necessary as may be required to cause the funds held in their joint names and on their behalf in the National Australia Bank account no. …81 to be transferred equally to each party and thereafter be closed.
16.That pending completion of the sales referred to in Orders 2 to 7 herein the parties shall pay when and as they fall due:
16.1As to the Applicant Husband, the council rates and water rates in relation to the Suburb C property and the monthly principal and interest instalments in relation to National Australia Bank loan Account no. ending …33;
16.2As to the Respondent Wife, the council rates and water rates and strata levies excluding arrears as at the date of the making of these Orders in relation to the Suburb E property and the monthly principal and interest instalments in relation to National Australia Bank loan Account no. ending …08.
17.That except as provided for in these Orders, the Applicant Husband shall be declared to be the sole legal and beneficial owner and shall retain all right, title and interest in and to all other assets and liabilities in his name, possession and control including but not limited to the following:
17.1All cash at bank and moneys invested by the Applicant Husband in his sole name;
17.2All furniture and personal effects in the Applicant Husband’s possession, including any household possessions contained within the Suburb C property;
17.3All shares in the company G Pty Ltd;
17.4Any superannuation entitlements received by the Applicant Husband and invested by him or on his behalf.
18.That except as provided for in these Orders, the Respondent Wife shall be declared to be the sole legal and beneficial owner and shall retain all right, title and interest in and to all other assets and liabilities in her name, possession and control including but not limited to the following:
18.1All cash at bank and moneys invested by the Respondent Wife in her sole name;
18.2All furniture and personal effects in the Respondent Wife’s possession, including any household possessions contained within the Suburb E property.
18.3Any superannuation entitlements received by the Respondent Wife and invested by her or on her behalf.
19.That the Applicant Husband shall solely pay and bear as and when they fall due all repayments of principal, interest or fees and charges in relation to the credit card held in his sole name with the National Australia Bank and the Applicant Husband indemnifies the Respondent Wife against any liability for a contribution to same.
20.That the Applicant Husband shall solely pay and bear as and when they fall due all repayments of principal, interest or fees and charges in relation to the Directors Loan for the Company G Pty Ltd and the Applicant Husband shall and does hereby indemnify the Respondent Wife against any liability for a contribution to same.
21.That the Respondent Wife shall retain and be solely liable for and hereby indemnify and keep indemnified the Applicant Husband with respect to the debt owing to Centrelink and Child Support.
22.That, unless otherwise specified in these Orders, and except for the purpose of enforcing the payment of any money due under these or any subsequent Orders:
22.1Each party shall be solely entitled to the exclusion of the other in both law and in equity to:
22.1.1All property (including choses-in-action) in the possession of such party as at the date of these Orders;
22.1.2All insurance policies in relation to which they are the Life Insured.
22.2Each party shall be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders.
23.In the event that either party refuses or neglects to execute any deed, document or instrument necessary to give effect to all or any of these Orders then the Judicial Registrar of the Court shall be appointed pursuant to section 106A of the Family Law Act1975 (Cth) to execute such deed, document or instrument in the name of the said party and to do all acts and things necessary to give validity and operation to the deed, document or instrument upon the Judicial Registrar being provided with verification of such refusal or failure by way of affidavit.
24.Liberty to apply on seven days’ notice in relation to any issue relating to the facilitation or implementation of the above Orders.
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).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE NEWBRUN
INTRODUCTION
These are Reasons for Judgment relating to a final property hearing held before the Court on 19 to 20 October 2023.
The wife and husband both appeared legally represented.
PROPOSALS
A “Joint Proposed Minute of Order” was prepared by the parties which sets out the agreed mechanics with respect to the sale of the property located at B Street, Suburb C NSW (‘Suburb C Property’) and the property located at D Street, Suburb E NSW (‘Suburb E property’), roll out of the parties’ SMSF entitlement and collection of belongings and household contents. The parties proposed that the Court determine the outstanding issues in dispute, including as to the manner in which the net proceeds of sale of those two properties should be divided between the parties.
MATERIAL RELIED UPON
The husband relied upon:
(a)His Amended Financial Statement filed 1 September 2023;
(b)His Initiating Application filed 16 March 2023;
(c)His Affidavit filed 1 September 2023;
(d)His Case Outline filed 16 October 2023.
The wife relied upon:
(a)Her Amended Response filed 1 September 2023;
(b)Her Financial Statement filed 1 September 2023;
(c)Her Affidavit filed 1 September 2023;
(d)Her Financial Questionnaire filed 5 May 2022;
(e)Her Genuine Steps Certificate filed 5 May 2022;
(f)Her Case Outline filed 13 October 2023.
The following documents became exhibits:
(a)Exhibit A: Husband’s “H” document;
(b)Exhibit B: Husband’s costs notice filed 18 October 2023;
(c)Exhibit C: Husband’s individual tax return FY2022-2023;
(d)Exhibit D: Wife’s proof of evidence;
(e)Exhibit E: Bathroom renovation quote dated late 2020 (pp 3–4 of 119 of husband’s tender bundle);
(f)Exhibit F: Betting account activity statement for the period late 2020 to late 2021 (pp 8–10 of 119 of husband’s tender bundle);
(g)Exhibit G: Betting account transaction summary, agreed to be for the period late 2022 to late 2023 (pp 5–7 of 119 of husband’s tender bundle);
(h)Exhibit H: Husband’s three page list of transactions from account ending #...61;
(i)Exhibit I: Statement of wife’s account ending #...49 for the period 28 January 2021 to 29 March 2021 (pp 28–30 of 119 of husband’s tender bundle);
(j)Exhibit J: Statement of wife’s account ending #...12 for the period 29 March 2021 – 6 April 2021 (pp 11–27 of 119 of husband’s tender bundle);
(k)Exhibit K: Joint balance sheet;
(l)Exhibit L: Screenshot dated 11 June 2021;
(m)Exhibit M: Two photographs of wife and Mr J;
(n)Exhibit N: Wife’s costs notice filed 18 October 2023;
(o)Exhibit O: Balance of husband’s tender bundle;
(p)Exhibit P: K Company transaction summaries dated late 2021 and late 2022 (Pages 171–172, 219–220 of K Company subpoena documents);
(q)Exhibit Q: Statement of joint offset account ending #...81 for the period 2 October 2020–31 December 2020;
(r)Exhibit R: Husband’s bank statement (Acct ending #...61) for the period 5 January 2021–4 March 2021 with handwritten markings.
EVIDENCE
The Court has considered the documentary material relied upon by the parties discussed above, and the parties’ oral evidence. The standard of proof applied by the Court in respect to the evidence is the balance of probabilities. The Court does not propose to set out the entirety of the evidence. Relevant evidence relating to the issues to be determined will be set out under the headings, “BALANCE SHEET”, “CONTRIBUTIONS”, and “SECTION 75(2) OF THE ACT”.
Legal principles
In Lotta & Lotta [2017] FamCA 50 Foster J stated:
281 The approach to the determination of an application under s 79 of the Act is set out in Stanford v Stanford (2012) 247 CLR 108 and further considered by the Full Court in Bevan & Bevan [2014] FamCAFC 19, Chapman & Chapman (2014) FLC 93–592 and Scott & Danton [2014] FamCAFC 203.
282The Court must identify the existing legal and equitable interests of the parties in the property, the liabilities and financial resources of the parties at the time of the hearing and then whether it is just and equitable to make a property settlement order.
283Such a consideration should not be guided by an assumption that the parties’ rights to or interests in property are or should be different from those that then exist. The question is whether those rights and interests should be altered.
284There is no presumption that one or other party has the right to have the property of the parties divided between them or a right to an interest in marital property that is fixed by reference to the various matters in s 79(4). The Court needs to conclude that it would be unjust or unfair to leave property rights intact under s 79(2) of the Act.
285In many cases this requirement is readily satisfied where the parties are no longer in a marital or de facto relationship and, thus, for example, the common ownership or use of property by husband and wife will no longer be possible or the express or implicit assumptions that underpinned existing property arrangements such as the accumulation of assets or financial resources by one for the benefit of both have been brought to an end with the relationship.
286In particular, such a circumstance arises where both parties seek property adjustment orders but are unable to agree as to same. Here the wife seeks an order for adjustment of property and the husband contends that there should be no such adjustment.
287It is thus important to ascertain the present property and resources of the parties so as to facilitate a consideration of the s 79(2) question.
288In some circumstances it is not possible to determine whether it is just and equitable to make adjustment orders as to the parties’ present property rights without a consideration of s 79 (4) matters.
289Section 79(4) requires a consideration of the contributions made by the parties as defined in s 79(4)(a) to (c). The Court must then consider s 79(4)(d) to (g) in particular the subjective considerations as to the parties by having regard to the provisions of s 75(2) in so far as they are relevant (s 79(4)(e)).
290The Court can then consider the “justice and equity” of the actual orders to be made: Russell & Russell (1999) FLC 92–877; Teal & Teal [2010] FamCAFC 120, in the context of the Court’s obligation to make “appropriate orders” as provided for in s 79(1) of the Act.
BALANCE SHEET
The joint balance sheet is now set out:
BALANCE SHEET Ownership Description Applicant’s value Respondent’s value Assets 1 Joint B Street, Suburb C at 14.6.23 $1,350,000 $1,350,000 2 Joint Unit D Street, Suburb E at 14.6.23 $725,000 $725,000 3 Applicant Shares held in G Pty Ltd $33,000 $35,577 4 Applicant Loan to G Pty Ltd $2,577 $0 5 Joint NAB Account #...81 as at 12 March 2022 $0 $0 6 Applicant NAB #...61 at 21.9.23 (including $[…] Lotto win in 2022) $3,919 $3,919 7 Respondent NAB #...29 as at 19.9.23 $306 $306 8 Respondent NAB #...49 as at 28.7.23 $0 $0 9 Respondent NAB #...12 as at 18.9.23 $2,367 $2,367 10 Applicant Furniture and personal effects $10,000 $10,000 11 Applicant Tools in Shed $2,000 $2,000 12 Respondent Furniture and personal effects $5,000 $5,000 13 Respondent Diamond Ring E $5,500 Nil Total $2,134,169 $2,134,169 Addbacks 14 Bank funds withdrawn by Respondent after separation from Joint NAB A/c #...81 $57,422 Nil 15 Bank funds withdrawn by Applicant after separation from Joint NAB A/c #...81 $2,038 Nil 16 Proceeds of Motor Vehicle 1 $4,500 Nil Total $63,960 $0 Liabilities 17 Joint NAB Mortgage #...08 on Suburb C @ 10.23 E $283,000 $283,000 18 Joint NAB Mortgage #...33 on Suburb E @ 10.23 E $284,000 $284,000 19 Applicant NAB Credit Card #...03@ 21.9.23 $5,253 $5,253 20 Respondent Tax Liabilities $0 $0 21 Respondent Centrelink Debt $0 $6,253 22 Joint CGT on possible sale of Suburb E property E $69,256 E $69,256 Total $647,762 $647,762 Net Assets (including addbacks) $1,555,867 $1,486,407 Superannuation Member Name of Fund Type of Interest Applicant’s value Respondent’s value 24 Applicant Clement Superannuation Fund @30.6.23
Incl NAB #...30SMSF $124,415 $124,415 25 Respondent Clement Superannuation Fund @30.6.23
Incl NAB #80SMSF $93,354 $93,354 26 Respondent Super Fund 1 @ 19.9.23 Accumulation $9,820 $9,820 Total $227,589 $227,589 Financial Resources Mr J NK NK Total $0 $0
Total Paid Legal Fees Husband says paid from Lotto win, earnings and $10,000 loan $103,520 $22,317
In relation to Item 4, the loan to the husband’s company of $2,577, the husband refers to this loan in his affidavit. The wife adduces no significant evidence to the contrary. It shall remain in the balance sheet.
In relation to Item 13, the wife’s diamond ring, E $5,500, it is referred to in the husband’s affidavit as part of the current asset pool. It was put to the wife in cross-examination that she took this ring with her at separation, to which she denied. In the wife’s affidavit she refers to a ring the husband bought her as a gift and that a loan balance for the ring was paid off out of the parties’ joint offset account. The Court accepts the wife’s evidence relating to this gift, including that she left the ring at the former matrimonial home at separation, and it shall be removed from the balance sheet.
In relation to Item 14, the husband contends that an addback of $57,422 should be made by reason of the wife withdrawing this sum from the parties’ offset bank account (NAB #...81) on about 31 March 2021.
The wife contends she used this sum for reasonable living expenses and the Court accepts this contention and accepts the wife’s related evidence in this context. The Court now refers to aspects of her evidence in this context without being exhaustive.
The Court accepts the wife’s evidence that she had caused a car accident in early 2021 and incurred resulting expenditures including repairs to the car that she damaged, $5,000, and the cost of a replacement car $4,500 that she bought. Initially she had borrowed moneys from her friend Mr J for such expenditures and, after she withdrew the $57,422, repaid him.
The Court accepts the wife’s evidence that from the above sum of $57,422 withdrawn by her she put cash aside as she had debts to pay off, she had rental or board obligations, she had paid a holiday for the children in 2021, she had significant petrol and other expenses for a motor vehicle she had borrowed (and in this context the wife had to drive from Town L to Suburb M; the wife living in Town L was costly to the wife).
The Court accepts the wife’s evidence that she paid Mr J board in advance.
The Court accepts the wife’s evidence that she was unemployed for a significant period of about 12 months during the Covid pandemic and the withdrawal monies assisted her during this unemployment.
The Court accepts her evidence that when she left the former matrimonial home at separation she left with few possessions. The Court accepts her evidence that she was very generous to the children with gifts over Christmas 2020.
The Court accepts the wife’s evidence that post separation she was often returning to the former matrimonial home, when the husband was not present, and cooking meals for the children. The Court accepts her evidence that post separation she spent moneys on the children’s activities on outings with her.
The Court accepts the wife’s evidence that she presently has no cash left at her residence.
The Court finds that the wife probably did not pay any significant legal fees out of the $57,422 withdrawn by her, and accepts the wife’s evidence in this context.
The Court views the wife’s proof of evidence (Exhibit D) as being broadly consistent with paragraph 67 of the wife’s affidavit filed 1 September 2023.
As to Item 15, an addback of $2,038 relating to bank funds withdrawn by the husband after separation from joint NAB account #...81, this sum shall remain in the balance sheet representing an admission against interest by the husband.
As to Item 16, proceeds of Motor Vehicle 1, $4,500, the husband’s affidavit filed 1 September 2023, under the heading “Current Asset Pool”, had referred to this vehicle as having an estimated value of $300. The Court is not persuaded, on the balance of probabilities, that the sum of $4,500 should be added back into the balance sheet, and it shall be removed from the balance sheet.
As to Item 21, a Centrelink debt, $6,253, the wife’s evidence was that the parties were paid more than what they were entitled to regarding Centrelink payments and they have the joint debt to Centrelink accordingly. This evidence is consistent with the letter from Centrelink to the wife dated 27 August 2021, Exhibit S, in which it is effectively stated that the overpayment related to the 2019–20 financial year; the Court observes that the parties separated after the end of that financial year. The Centrelink debt arose out of the parties’ relationship and shall remain in the balance sheet.
The wife sought an addback to the balance sheet in the sum of $103,520 representing legal fees paid by the husband to his lawyers (see page 2 of the balance sheet). She submitted that he had failed to explain how he paid his lawyers this sum in circumstances where, inter alia, he had had an overseas trip post separation, conducted gambling activities, was supporting himself and the children post separation, and was only receiving modest child support. This addback was opposed by the husband, submitting that he had adequately explained how such monies had been paid.
The Court finds that the husband has adequately explained how he paid the above sum of $103,520 for legal fees as follows:
·He probably utilised cash of $10,000 from a safe at the former matrimonial home at about the time of separation.
·He was receiving a fortnightly carer’s pension (for the wife’s care) at least for a period during January 2021.
·He utilised his lotto win (the win occurred mid-2022) of about $36,427, with the Court finding that the husband had purchased the lotto ticket out of his own income post separation. This lotto win was not matrimonial property and to which the wife made no relevant contribution. By reference to paragraph 11 of the decision in Eufrosin & Eufrosin [2014] FamCAFC 191, when the lotto ticket was purchased post separation by the husband, the parties’ joint endeavour that had been their relationship had dissolved and there was no longer a common use of property; rather the parties were applying funds for their respective individual purposes.
·He borrowed $10,000 in late 2023 from Mr N.
·The balance (for legal fees) was likely paid by the husband to his lawyers intermittently in small amounts from his work income since about separation to date, a period approaching almost three years, and the Court accepts the husband’s evidence in this context.
In this context, the Court observes, in passing, from Exhibit R, the husband’s bank statements from 5 January 2021 to 4 March 2021, being account NAB #...61, into which, inter alia, his “pay” (usually $1,308) was being regularly deposited, and from which his lawyers were paid on 10 February 2021 the sum of $3,176, leaving a then balance of $12,961, the closing credit balance in that account as at 4 March 2021 was $13,928 (cents ignored). The Court further observes that as at trial date, the joint balance sheet refers to that bank account having a credit balance of $3,919.
The final balance sheet will be as follows:
BALANCE SHEET Ownership Description Value Assets 1 Joint B Street, Suburb C (‘Suburb C property’) $1,350,000 2 Joint D Street, Suburb E (‘Suburb E property’) $725,000 3 Applicant Shares held in G Pty Ltd $33,000 4 Applicant Loan to G Pty Ltd $2,577 5 Joint NAB Account #...81 $0 6 Applicant NAB #...61 $3,919 7 Respondent NAB #...29 $306 8 Respondent NAB #...49 $0 9 Respondent NAB #...12 $2,367 10 Applicant Furniture and personal effects $10,000 11 Applicant Tools in Shed $2,000 12 Respondent Furniture and personal effects $5,000 Total $2,134,169 Addbacks 13 Applicant Bank funds withdrawn by Applicant after separation from Joint NAB A/c #...81 $2,038 Total $2,038 Liabilities 14 Joint NAB Mortgage #...33 on Suburb C $283,000 15 Joint NAB Mortgage #...08 on Suburb E $284,000 16 Applicant NAB Credit Card #...03 $5,253 17 Respondent Tax Liabilities $0 18 Respondent Centrelink Debt $6,253 19 Joint CGT on possible sale of Suburb E property $69,256 Total $647,762 Net Assets (including addbacks) $1,488,445 Superannuation Member Name of Fund Type of Interest Value 20 Applicant Clement Superannuation Fund
Incl NAB #...30SMSF $124,415 21 Respondent Clement Super Fund
Incl NAB #...30SMSF $93,354 22 Respondent Super Fund 1 Accumulation $9,820 Total $227,589 Net Total Assets Total $1,716,034
In the circumstances, it is not necessary to establish a separate pool for superannuation assets, and in this regard the Court refers to its brief discussion of superannuation under “Contributions” below.
Accordingly, the parties’ non-superannuation assets are $2,134,169, and there is an addback of $2,038, resulting in a figure of $2,136,207. Liabilities are $647,762. Accordingly, the total net assets, including an addback, is $1,488,445, and their superannuation entitlements are $227,589, arriving at total assets of $1,716,034.
SECTION 79(2) OF THE ACT
The Court is satisfied that it is just and equitable in this case to alter the property interests of the parties in light of the breakdown of their relationship, the fact that they will no longer have the joint use and enjoyment of their property, and the fact that the continuance of the current legal ownership of their property would not afford them justice and equity.
CONTRIBUTIONS
The relationship of the parties spanned the period from 1998 to about November 2020.
At cohabitation commencement, the husband did not have any significant assets or liabilities owning a motor vehicle, minor savings and personal effects. The wife had a car, some O Company shares, and some superannuation (see below).
In about 2001 the parties purchased a property at Suburb P $340,000, and the wife had sold her shares in O Company for about $11,000 and her car for about $6,000, which funds were applied towards the deposit for this property.
During the parties’ relationship the husband was the primary income earner for the family working full-time as a tradesperson and applied his income to the acquisition of property, the reduction of debt and the benefit of the family.
During the parties’ relationship the wife worked a mix of full-time and part-time employment, when not on maternity leave, and applied her income to the acquisition of property, the reduction of debt and the benefit of the family. She assisted the husband with administration work relating to his transport company, and she received the benefit of a company car.
The husband won two bets totalling $17,700, in 2016 and 2018, and used these monies for holidays for the family.
During the parties’ relationship the wife attended to the majority of household duties. During this time she was also the primary carer of the children. The Court finds that the husband’s assistance to the wife with care of the children during their relationship was likely quite modest having regard to the considerable time the husband spent on his hobby of gambling, in particular on Saturdays (but not exclusively on Saturdays).
During the parties’ relationship they purchased an investment property at Suburb E. This property was tenanted before and since separation. The rent was usually more than the mortgage repayments and the property outgoings, however the wife since April 2021 has paid about $4,771 for mortgage repayments. Since about April 2021 the wife has managed this investment property saving about $3,907 in management fees. As to the wife’s management of the Suburb E investment property, including in relation to strata levies, the Court accepts the wife’s evidence.
At about the time of separation the parties had about $20,000 cash in a safe in the former matrimonial home which they had accumulated during the relationship. The parties equally shared these monies; the wife took $10,000 and the husband $10,000.
The Court finds that during the parties’ relationship (and post separation) the husband pursued his hobby of gambling. On the balance of probabilities, the husband roughly broke even in relation to his betting outlays and winnings both during the relationship and post separation.
Post separation, the children then aged 13, 15, 17 and 20 years, remained living with the husband in the former matrimonial home at Suburb C. The husband maintained the children although he did obtain board from his adult children post separation charging them 10 per cent of their income (and see Item 15 in the husband’s Financial Statement filed 1 September 2023 showing he receives $125 per week from his adult sons). And again, the husband continued his hobby of gambling post separation, in particular on Saturdays (but not exclusively on Saturdays). Post separation the wife provided some care of the children and paid some monies on their behalf for extracurricular activities and when on outings. Since January 2021 she has met child support payments as assessed. Since April 2021, the husband has paid the mortgage repayments in respect to the former matrimonial home, being a sum of about $28,043, together with rates, insurance and other outgoings in respect to the former matrimonial home.
Shortly after separation the wife left the former matrimonial home and rented accommodation.
Post separation the wife spent no overnight time with Mr Q and Mr R except for four days during a short holiday. Post separation the wife has spent no overnight time with Z except for two short holidays. However she did, post separation, on occasion, return to the former matrimonial home when the husband was not present, to prepare meals for the children, and further, she has spent daytime time with the children post separation, including going on outings with them.
As to superannuation, at cohabitation in 1998 the wife had superannuation of about $7,000 which had probably accumulated from her employment at O Company which she had started in about 1991. The husband had no superannuation at cohabitation.
The wife had worked at O Company after 1998 up to the birth of the parties’ first child in 2000, returned to work there in later 2000, and worked there until the birth of their second child in 2003; the wife had likely accumulated superannuation during these periods.
In about 2003, about 5 years later, the parties set up a joint self managed super fund (SMSF). The wife’s entire accumulated superannuation from O Company was transferred into the SMSF. The husband was a sole trader at the time of setting up the SMSF and did not contribute any superannuation at this time.
The husband’s affidavit filed 1 September 2023 refers to his interest in the parties’ SMSF as at 30 June 2022 as being $119,775, in contrast to the current value in the balance sheet being $124,415; a difference of $4,640. He asserts that from his work and employment post separation he has made three years’ worth of contributions to his member account in the SMSF amounting to about $7,800 a year ($23,400 in total). That same affidavit refers to the wife’s interest in the SMSF as at 30 June 2022 being the sum of $93,114 being a figure close to the current value of $93,354 in the balance sheet. Further, that same affidavit refers to the wife’s interest in her separate superannuation fund as at 30 June 2021 as being $4,530, with its current value in the balance sheet being $9,820; a difference of $5,290.
The husband contended that his contributions should be assessed at 55 per cent, particularly taking into account his care of the children post separation to date.
The wife contended her contributions should be assessed at 53–55 per cent.
Taking into account all the above discussed matters, and viewing the parties’ contributions holistically, the Court finds that the parties’ contributions should be assessed equally both as to non-superannuation and superannuation assets.
SECTION 75(2) OF THE ACT
The wife is aged 50 but will turn 51 years in 2023. The husband is aged 52.
The total length of the parties’ relationship was about 22 years. There were 4 children of the relationship. The parties’ children remain living with the husband; the only child under the age of 18 is X aged 16 and who turns 17 in 2024. The adult children pay regular board to the husband in the sum of $125 per week.
The husband contended that he will need to rehouse the parties’ children in the event that the former matrimonial home and the investment property at Suburb E is sold.The Court observes that the youngest child will turn 17 years in 2024. The remaining 3 adult children are financially independent and 2 of those children pay weekly board to the husband. The adult child Mr Q works full-time in an apprenticeship. Mr R works casually while studying. The adult child Mr S works full-time.
The wife pays child support. She had been in arrears of child support prior to January 2021. In about mid-late August 2023 these arrears were substantially paid. Since January 2021 she has met child support payments as assessed. The Court accepts the wife’s evidence relating to post separation financial payments made by her for the children’s benefit, such as sports costs.
The husband is in reasonable health.
The wife presently works in employment as an administration officer. Presently her work hours are 8am to 4pm however they vary day to day. Post separation she has at times worked full time, however for about 12 months post separation she was unemployed and received Jobseeker benefits. Her Financial Statement filed 1 September 2023 states she earns $1,200 in weekly wages before tax.
The wife in 2008 underwent surgery. The wife requires various bathroom breaks which she cannot control or delay. She feels constantly fatigued by this condition and does not know how much longer she will be able to continue working full-time on a casual basis. Her condition is only partially managed by medication.
The wife’s GP report dated 2 November 2021 states, inter alia, that the wife “is struggling to hold any work, as she struggles with a medical condition (on a) daily basis and she feels herself in a depressive situation and gets embarrassed at times at workplace. Her current treatment is conservative management, there is no further treatment planned at this stage.”
The husband’s Financial Statement filed 1 September 2023 states that he receives $1,442 in wages before tax.
The Court refers to the husband’s evidence relating to his previous taxable income, his 2023 income tax return, and also refers to his evidence relating to the wife’s previous taxable income.
The Court would assess that the husband’s income earning capacity is greater than that of the wife’s earning capacity.
The husband presently is in a relationship with a woman named Ms T. He does not live with this person. She meets her own costs.
The wife has a close friend Mr J. She used to be in a relationship with him which ended about 12 months ago. She now lives at his house. They are not in a relationship. The Court accepts the wife’s evidence in this context.
The husband contended that he should obtain an adjustment in his favour of 5 per cent under s.75(2), by reason of, inter alia, his need to rehouse himself and the parties’ children, and his care of the child X, now aged 16 years, and who will turn 17 years in 2024.
The wife contended that there should be an adjustment in her favour under s 75(2) in the range 5–7 per cent by reason of, inter alia, her health condition (see above) adversely affecting her earning capacity.
Taking into account all the above discussed matters, there should be an adjustment in favour the wife of 2.5 per cent. This results in an adjusted contributions finding in favour of the wife of 52.5 per cent and 47.5 per cent to the husband, with the resulting disparity being $85,801 in the wife’s favour.
JUSTICE AND EQUITY
The husband’s 47.5 per cent of the net property pool ($1,716,034) is $815,116.
The wife’s 52.5 per cent of the net property pool ($1,716,034) is $900,917.
It is common ground that the Suburb C and Suburb E properties should be sold.
Should the husband retain:
(a)shares in G Pty Ltd, and loan to that company: $35,577;
(b)NAB account …61: $3,919;
(c)furniture and personal effects: $10,000;
(d)tools in shed: $2,000;
(e)his superannuation: $124,415;
(f)the addback of $2,038;
Less his credit card debt of $5,253;
The net total of the above is $172,696.
Should the wife retain:
(a)NAB accounts …29 and …12, $306 + $2,367: $2,673;
(b)furniture and personal effects: $5,000;
(c)her superannuation interests: $103,174;
Less the Centrelink debt: $6,253;
The net total of the above is $104,594.
The total of the above net sums ($172,696 + $104,594) is $277,290. The wife’s 52.5 per cent share of that $277,290 is $145,577, and the husband’s 47.5 per cent share of that $277,290 is $131,712. Thus, to effect these percentage shares, the husband will need to pay the wife ($145,577 - $104,594) $40,983.
The Suburb C property is valued at $1,350,000 less mortgage loan of $283,000 leaving net $1,067,000. The wife should receive 52.5 per cent of this net figure being $560,175. The husband should receive 47.5 per cent of this net figure being $506,825.
The Suburb E property is valued at $725,000 less mortgage loan of $284,000 leaving $441,000. After deducting CGT of $69,256, a net figure of $371,744 is reached. The wife should receive 52.5 per cent of $371,744 being $195,165 plus the above figure of $40,983 totalling $236,148. The husband will receive the balance of $135,596.
In view of the above, the husband will retain his present held assets of $172,696, and will receive $642,421 from the sale of the above two properties. There is a real prospect that he will thereby be in a position to purchase real estate.
In view of the above, the wife will retain her present held assets of $104,594, and will receive $796,323 from the sale of the above two properties. There is a real prospect that she will thereby be in a position to purchase real estate.
The Court is of the view that its proposed property adjustment orders will represent a just and equitable property settlement between the parties.
The Court makes Orders accordingly.
I certify that the preceding eighty (80) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Newbrun. Associate:
Dated: 3 November 2023
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