Clives and Clives (No. 2)

In *Clives and Clives (No. 2)*, the Family Court of Australia at Sydney considered applications by Mr. Clives (the applicant) and Mrs. Clives (the respondent) for property settlement and superannuation splitting orders. The court had previously made parenting orders on 12 July 2007. The primary dispute regarding property settlement concerned the treatment of $57,831, representing net interest earned on funds deposited into an account in the wife's sole name, which the husband sought to have added back as a notional asset.

The court was required to determine the net property of the parties, assess their respective financial and non-financial contributions, and consider relevant matters under section 75(2) of the *Family Law Act 1975* (Cth) to make just and equitable property settlement orders. Additionally, the court had to determine the terms of superannuation splitting orders, considering the parties' contributions to their respective superannuation entitlements and the impact of section 75(2) factors.

Justice Rose applied a four-step approach to property settlement, beginning with identifying the parties' property and financial resources. The court found that the $57,831 in dispute, representing net interest earned on combined proceeds of sale of the former matrimonial home and savings, should not be added back as a notional asset. This was because the wife's evidence, which was accepted, demonstrated that these funds were used for appropriate living expenses and expenditure for herself and the children, and there was a lack of evidence of unreasonable expenditure. The court assessed the parties' contributions to their net property (excluding superannuation) as 55% in favour of the husband and 45% in favour of the wife. Further, considering section 75(2) matters, particularly the wife's primary care of the children and her consequently restricted earning capacity, an adjustment of 15% was made in her favour, resulting in a final division of net property (excluding superannuation) of 60% to the wife and 40% to the husband. For superannuation splitting, the court determined that orders should reflect a 60% division in favour of the wife and 40% in favour of the husband, after considering contributions and section 75(2) factors, and calculated a base amount of $93,514 for the superannuation splitting order.