Connor and Langton - [2012] FamCA 875

FAMILY COURT OF AUSTRALIA

CONNOR & LANGTON

[2012] FamCA 875

FAMILY LAW – PROPERTY - Value of property – Whether non transferrable tax-losses of one party’s corporation through which the parties’ income is generated should be added as an asset of the party to the property pool where the company has a nil value otherwise - Should a substantial loan account a party holds in a private company which is unable to pay the loan if the company was wound up be treated as an asset of the party on the balance sheet.
FAMILY LAW – PROPERTY – Initial Contribution – Where parties’ property has been segregated – Whether an initial contribution is off-set by other contributions made during the marriage

Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth)

Cabbell & Cabbell [2009] FamCAFC 205
GWH & PGH [2005] FamCA
Pierce & Pierce (1999) FLC 92-844

APPLICANT:

Ms Connor

RESPONDENT:

Mr Langton

FILE NUMBER:

SYC

5094

2008

DATE DELIVERED:

28 March 2012

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Le Poer Trench J

HEARING DATE:

20 & 21 June 2011
28 February- 2 March 2012

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Lethbridge

SOLICITOR FOR THE APPLICANT:

Stuart & Mills Lawyers

COUNSEL FOR THE RESPONDENT:

Mr Grieve
Ms Coulton

SOLICITOR FOR THE RESPONDENT:

Bell & Johnson Solicitors

Orders

The wife is to manage the funds held in two ANZ bank accounts, being funds allocated to meet the children’s education expenses together with a similar fund held in Elders term deposit. When the children have concluded their secondary and tertiary education, or at any earlier time the parties mutually agree upon, the remainder of the funds held in the above accounts or any subsequent investment are to be divided between the parties equally.
Each party is to be declared the absolute owner of items of real property, personal property, shareholdings, superannuation and resources currently standing in their sole names or being in their control.
All outstanding interim orders and applications/responses in relation to final orders in this court are otherwise dismissed.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Connor & Langton has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC

Ms Connor

Applicant

And

Mr Langton

Respondent

REASONS FOR JUDGMENT

Introduction

The parties seek property orders which deviate only in the amount of cash each seeks the other pay by way of property settlement. Each of the parties owns substantial property interests in their sole name and they do not own any property in their joint names.
The parties have two children. They are H aged 18 and B aged 16. The children live in an equal shared time regime between the parents. Each parent has a residence in Sydney. The husband maintains his residence and business interests in N Town, NSW.
The parties hold investment funds for the children’s education. They…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Connor and Langton

Details

AGLC: Connor and Langton [2012] FamCA 875
Case: [2012] FamCA 875
Decision Date

CaseChat Overview and Summary

In the Family Court of Australia, Ms Connor (the applicant wife) and Mr Langton (the respondent husband) sought property orders following their separation. The parties had two children, who lived in an equal shared time arrangement between their residences in Sydney. The core of the dispute concerned the division of property, with the parties seeking orders that largely involved each retaining assets in their sole names, with the primary difference being the quantum of cash payments sought by each party for property settlement.

The court was required to determine several legal issues. These included whether non-transferable tax losses of the husband's corporation, through which the parties' income was generated, should be included as an asset in the property pool, particularly where the company otherwise had a nil value. Additionally, the court had to consider whether a substantial loan account held by the husband in a private company, which was unable to repay the loan if wound up, should be treated as an asset of the husband. The court also considered the impact of initial contributions made by the husband, and whether these were offset by other contributions made by both parties during the marriage, in accordance with the *Family Law Act 1975* (Cth).

The court found that the husband's initial contributions, including property and a share in a company, were offset by significant liabilities at the commencement of cohabitation. The court accepted the wife's evidence as generally more accurate and realistic regarding historical facts and financial matters. The court noted that the husband's taxable income was often insufficient to meet his contributions to the joint account, suggesting these were likely drawn from his loan account with his company. The court also considered the wife's substantial contributions through her employment and investments throughout the marriage, as well as her role in managing the children's education fund.

The final orders provided for the wife to manage funds held in specific bank accounts and term deposits allocated for the children's education expenses. Upon the conclusion of the children's education, or by mutual agreement, any remaining funds were to be divided equally between the parties. Each party was declared the absolute owner of real property, personal property, shareholdings, superannuation, and resources standing in their sole names or under their control. All outstanding interim orders and applications related to final orders were dismissed.

Orders