Culotta & Culotta
[2022] FedCFamC2F 50
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Culotta & Culotta [2022] FedCFamC2F 50
File number(s): ADC 967 of 2021 Judgment of: JUDGE DICKSON Date of judgment: 28 January 2022 Catchwords: FAMILY LAW – PROPERTY – 27 year marriage – two now adult children of marriage – where at Trial the husband minimised the wife’s contributions during the marriage – where both parties contributed financially and non-financially to their family unit during the course of their marriage but in different ways – where contributions should therefore be assessed as equal – where the husband has not paid the mortgage or Line of Credit secured against the former matrimonial home since separation in 2017 aside from two payments – where the wife should receive a 10% adjustment due to the husband’s conduct in not meeting the liabilities secured against the former matrimonial home since separation – where husband seeks to retain the former matrimonial home at settlement – where husband should be afforded an opportunity to retain the former matrimonial home and pay the wife a settlement sum – where if the husband is unable to keep the former matrimonial home the property will be sold and the wife receive a settlement sum on a percentage basis. Legislation: Family Law Act 1975 (Cth), Pt VIII, ss.75, 79
Federal Circuit and Family Court (Family Law) Rules 2021, r.12.06Cases cited: Bremner & Bremner (1995) FLC 92-560
Browne v Green (1999) FLC 92-873
Carron v Laninga [2019] FamCAFC 115; (2019) FLC 93-909
Kowaliw & Kowaliw (1981) FLC 91-092
Jabour & Jabour [2019] FamCAFC 78; (2019) FLC 93-898, (2019) 59 Fam LR 475
Lalor & Lalor (1989) FLC 92-164
Money & Money (1994) FLC 92-485
AJO & GRO (2005) FLC 93-218
Pierce & Pierce (1999) FLC 92-844Stanford & Stanford (2012) 247 CLR 108
Division: Division 2 Family Law Number of paragraphs: 122 Date of last submission/s: 22 November 2021 Date of hearing: 10 November 2021 Place: Adelaide Counsel for the Applicant: Mr Bowler Solicitor for the Applicant: Gary Inglis & Associates The Respondent: In person ORDERS
ADC 967 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS CULOTTA
Applicant
AND: MR CULOTTA
Respondent
ORDER MADE BY:
JUDGE DICKSON
DATE OF ORDER:
28 JANUARY 2022
THE COURT ORDERS:
1. Pursuant to section 79 of the Family Law Act 1975 (Cth):
1.1.That within 30 days of the date hereof the husband pay to the wife the sum of $419,171.00 (‘the settlement sum’).
1.2.That contemporaneously with the payment referred to in paragraph 1.1 herein, the wife do discharge at her sole expense any Caveat registered by her on the property situate at B Street, Suburb C in the State of South Australia (being the whole of the land comprised and described in Certificate of Title Register Book Volume … Folio …) (‘the said former matrimonial home’).
1.3.That the wife do retain as her sole property:
1.3.1.The settlement sum;
1.3.2.The Motor Vehicle 1;
1.3.3.Her personal savings; and
1.3.4.Her furniture and effects and all other like property.
1.4.That the husband do retain as his sole property:
1.4.1.The said former matrimonial home;
1.4.2.The Motor Vehicle 2;
1.4.3.His personal savings;
1.4.4.His gun collection; and
1.4.5.His furniture and effects and all other like property.
1.5.That within 30 days of the date hereof, the husband shall do all such things and do sign all documents necessary to transfer his interest in the Motor Vehicle 1 into the sole name of the wife at her sole expense.
1.6.That in the event that the husband fails to comply with the payment to the wife of the settlement sum referred to in paragraph 1.1 hereof, then the parties shall do all acts and things and sign all documents necessary to sell the said former matrimonial home on such terms and conditions as agreed between the parties in writing, or in default of agreement, by such selling agent and on such terms and conditions as are recommended by the Secretary of the Real Estate Institute of South Australia, or as ordered by the Court, and the proceeds of sale of the former matrimonial home are to be disbursed as follows:
1.6.1.To pay all sales costs and agent’s fees, commissions and disbursements;
1.6.2.To discharge the mortgage to the Commonwealth Bank of Australia;
1.6.3.To discharge the Viridian Line of Credit with the Commonwealth Bank of Australia;
1.6.4.The net proceeds of sale thereafter be divided as to SIXTY PERCENTUM (60%) to the wife less $16,500.00 (being the assets in the wife’s possession) and FORTY PERCENTUM (40%) to the husband less $41,500.00 (being the assets in the husband’s possession).
1.7.That the wife do indemnify the husband and keep him indemnified in relation to any liabilities in her sole name, including but not limited to;
1.7.1.any credit card liabilities owing to NAB and Company D; and
1.7.2.any liability to the Australian Taxation Office.
1.8.That the husband do indemnify the wife and keep her indemnified in relation to any liabilities in his sole name, including but not limited to:
1.8.1.The Commonwealth Bank mortgage and Viridian Line of Credit secured over the said former matrimonial home;
1.8.2.any credit card liabilities owing to the Commonwealth Bank, NAB and Macquarie Banks;
1.8.3.any liabilities to the Region E Council; and
1.8.4.any private loans in the husband’s sole name, including but not limited to the sum of $25,000.00 owing to Ms F.
1.9.That each party sign all documents and do all things necessary to give effect to these orders.
1.10.Pursuant to section 106A of the Family Law Act 1975 (Cth) that in the event that either party refuses or neglects to comply with the provisions of these orders, a Registrar of the Federal Circuit and Family Court of Australia at Adelaide is hereby appointed to execute all deeds and documents in the name of the defaulting party and do all acts and things necessary to give validity to the operation to the deed or instrument.
2. That all applications do otherwise stand dismissed.
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 Culotta & Culotta has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE DICKSON:
INTRODUCTION
These reasons for judgment relate to the finalisation of matrimonial property matters following a long marriage between the parties concerned.
The proceedings came before the Court for Trial on 10 November 2021 and with final submissions being made on 22 November 2021.
RELATIONSHIP BACKGROUND
The applicant wife was born in 1953, and at the time of final hearing, was aged 68 years.
The respondent husband was born in 1955. At the time of final hearing, the husband was 66 years of age.
The parties commenced a relationship in approximately 1986. There was a period of brief separation in 1988 before the parties reconciled. The parties commenced cohabitation in approximately 1990 and married in 1992. They separated on 29 May 2017. The parties’ marriage came to a formal end by way of a divorce order dated 24 September 2020. It was a long relationship spanning at least 27 years.
There are two children of the marriage, namely Mr G and Mr H. At the time of final hearing, both of the parties’ children were adults, aged 30 and 27 years respectively. Mr H continues to live with the husband in the former matrimonial home and is a student.
The wife lists her occupation as a cleaner and the husband is presently unemployed. Previously, the husband worked as a professional. The wife contends that she will be retiring from the workforce shortly.
HISTORY OF PROCEEDINGS
The proceedings came before the Court by way of an Initiating Application filed by the applicant wife on 1 March 2021. In her Initiating Application, the wife sought the following orders by way of final order:
1.That by way of full and final settlement of property any claims that either party may have against the other for division of property and alteration of interest pursuant to Part VIII of the Family Law Act 1975 (as amended);
(i) That the property situated at B Street, Suburb C (‘the B Street, Suburb C property’) be sold and the proceeds of sale be applied as follows:
(a)To pay the agent’s fees, expenses of sale and conveyancing fees;
(b)To pay the mortgage debt to Commonwealth Bank; and
(c)As to the balance, 75% to the Applicant and 25% to the Respondent.
(ii) That each party be solely entitled to the exclusion of the other to all other property (including shares) and chattels of whatsoever nature and kind in the possession of such party at the date of this order and that for this purpose bank accounts and investments are deemed to be in the possession of the person whose name appears in the bank and investment records thereof and superannuation entitlements are deemed to be in the possession of the person who is named as the worker whose age or working future provides the conditions for payment of such entitlements.
(iii) That the parties do all acts, deeds and things and sign and execute all documents necessary to give full force and effect to this order provided that if either the Applicant or the Respondent shall refuse or neglect to execute a document necessary to give full force and effect to this order within fourteen (14) days after the same shall have been tendered to him or her for the purpose of execution then in such event a Registrar or Deputy Registrar of the Federal Circuit Court of Australia upon proof of affidavit of such refusal or neglect is hereby appointed to execute and if in his or her opinion it shall be necessary so to do to settle the same and to do all such other acts and things as shall be necessary to give full force and effect thereto and shall execute and do the same accordingly and the party in default shall pay the other party’s costs as agreed or taxed.
(iv) If either party shall default in compliance with any of the terms of this order, the party in default shall pay such costs of the other party as shall have reasonably been incurred in relation to the default.
(v) That the cost of any transfer or assignment or consequential disbursements thereof to give effect to the terms of this order shall be paid by the transferee or assignee in each case.
(vi) Such further and other orders as the Court deems fit.[1]
[1] See wife’s Initiating Application filed 1 March 2021.
In his Amended Response filed 3 November 2021, the husband sought final orders for the division of matrimonial property as follows:
1.That the parties and their legal representatives do attend a Conciliation Conference with a Registrar of the Federal Circuit and Family Court as soon as possible.
2.Unless otherwise exempted from payment the parties must each pay one half of the Conciliation Conference fee in accordance with the Family Law (Fees) Regulation 2012 28 days (TWENTY EIGHT DAYS) prior to the Conciliation Conference.
3.Within 21 days (TWENTY ONE DAYS) the parties should exchange mutual informal discovery of all documents that are or have been in their respective possession, custody or control, including but not limited to those that relate to the purchase, organisational structure, running and disposal of Company J, together with a list of agreed assets.
4.In full and final settlement of any claim that either party may have or hereafter have against the other for settlement of property, alteration of property interests and costs that the Respondent husband pay to the Applicant wife the amount of $290,000.00.
5.The Applicant remove the caveat lodged on the property situated at B Street, Suburb C, at her own expense.
7.The Applicant return to the respondent within seven days, all of the jewellery, crocodile handbag and any other terms in her possession, custody or control, that belonged to the Respondent’s mother.
8.Hereafter, the Respondent shall retain for his sole use and enjoyment absolutely free from any further claim or demand of the Applicant:-
a. the B Street, Suburb C property;
b. Any insurance policies owned by him;
c. Any monies in bank accounts in his sole name;
d. Any motor vehicle presently in his possession;
e. The furniture and effects in his possession;
f. All of his estate and interest both at law and in equity which he may now have or hereafter have in any superannuation scheme; and
g. Any other property or financial resource of the Respondent not otherwise specified.
9.With the exclusion of clause 7 above, hereafter the Applicant shall retain for her sole use and enjoyment absolutely free from any further claim or demand of the Respondent:
a. Any insurance policies owned by her;
b. Any monies in bank accounts in her sole name;
c. Any motor vehicle presently in her possession;
d. The furniture and effects in her possession;
e. All of her estate and interest both at law and in equity which she may now have or hereafter have in any superannuation scheme; and
f. Any other property or financial resource of the Applicant not otherwise specified.
10.The Respondent do indemnify the Applicant and keep her forever indemnified with respect to all debts and liabilities of the Respondent.
11.The Applicant do indemnify the Respondent and keep him forever indemnified with respect to all debts and liabilities of the Applicant.
12.Each party shall hereinafter be liable and responsible for the payment of all debts including credit card liabilities incurred in their sole name and shall release the other of them from any liability with respect thereto.
13.That the applicant pay the respondent’s costs of and incidental to this application.
14.Any other orders this Honourable Court deem appropriate.[2]
[2] See husband’s Initiating Application filed 29 April 2021.
On 9 September 2021, the wife filed an Application in a Proceeding seeking the sale of the property situated at B Street, Suburb C (‘the said former matrimonial home’). In her Affidavit filed contemporaneously with her Application, she deposed to the husband having stopped making mortgage repayments since separation, causing the mortgage debt to significantly increase.[3] She referred to the husband’s Financial Statement filed on 29 April 2021 in which he deposed to the mortgage repayments being ‘currently on hold’.[4] The wife further deposes to her belief that the husband has ‘no realistic prospect of financing the money needed to pay me out’[5] and accordingly, she sought the urgent sale of the former matrimonial home.
[3] See wife’s Affidavit filed 9 September 2021 at [10].
[4] Ibid [11].
[5] Ibid [12].
On 12 October 2021, the husband filed a Response to an Application in a Proceeding. He sought orders that the wife’s Application in a Proceeding be dismissed. Further, he sought orders for the wife to comply with her discovery obligations pursuant to the Orders of 3 May 2021 and for the matter to be relisted for another Conciliation Conference once the wife had provided her full discovery.
The wife’s Application in a Proceeding came before the Court for a first return date on 13 October 2021. On that occasion, I considered it appropriate that the parties’ respective final applications be listed for a one day Trial to commence on 10 November 2021. Out of an abundance of caution, the Court adjourned the wife’s Application in a Proceeding and the husband’s Response to the date of Trial in the event of the matter not being reached. The Court further made a suite of Orders to prepare the matter in readiness for Trial.
On 3 November 2021, the husband filed an Amended Response to Final Orders, altering his position for final orders from his original Response filed on 29 April 2021. In his final orders sought, the husband amended his position as follows:
(1)He sought that he pay the wife the sum of $290,000 by way of final settlement and he retain the former matrimonial home.[6] This was an amended position to his original order sought that the net asset pool including the sale proceeds of the former matrimonial home be divided on a 65/35 basis in his favour.
(2)He no longer sought an order that any monies held in joint bank accounts by the parties be divided equally between them.[7]
[6] See husband’s Amended Response to Final Orders filed 3 November 2021.
[7] Ibid.
At the compliance hearing before me on 8 November 2021, the husband’s then solicitors advised the Court that they would prepare the husband’s Trial documents but would not be acting for him at the Trial on 10 November 2021 and would be filing a Notice of Withdrawal as Lawyer later that day. Accordingly, the husband represented himself before me at the Trial.
In his opening address, Mr Bowler, counsel for the wife, amended the wife’s position such that the wife now seeks at trial 60% of the net assets in her favour and not 75% as set out in her Initiating Application. Mr Bowler submitted that a 10% adjustment should be made in favour of the wife on account of the husband’s failure to pay the Commonwealth Bank Mortgage and the Commonwealth Bank Viridian Line of Credit secured over the former matrimonial home since separation. The husband has occupied the former matrimonial home to the exclusion of the wife since final separation nearly five years ago.
DOCUMENTS RELIED UPON AT TRIAL
The documents that were relied upon by each party at Trial were as follows:
Wife’s documents:
(1)Initiating Application filed 1 March 2021.
(2)Trial Affidavit of the wife filed 1 November 2021.
(3)Financial Statement of the Wife filed 1 November 2021.
(4)Property valuation of B Street, Suburb C by Company K dated 1 September 2021 (marked as Exhibit W1).
(5)Outline of Case and Schedule of Assets and Liabilities.
Husband’s documents
(1)Amended Response filed on 3 November 2021.
(2)Trial Affidavit of the husband filed 3 November 2021
(3)Financial Statements of the husband filed on 29 April 2021.
(4)Outline of Case.
THE ASSET POOL
At the commencement of the Trial, both Mr Bowler and the husband provided schedules setting out the Assets and Liabilities at Trial.
The contents of the said Schedules, are extracted below:
| Asset | Wife’s Value $ | Husband’s Value $ | ||
| 1. | Former matrimonial home (Valuation) dated 1.09.2021 | Husband | 1,175,000.00 | Agreed |
| 2. | Motor Vehicle 2 (Redbook) | Husband | 29,000.00 | Agreed |
| 3. | Motor Vehicle 1 (Redbook) | Wife | 16,000.00 | Agreed |
| 4. | Monies in bank – NAB | Wife | 500.00 | 1,706.00 |
| 5. | Monies in bank – L Bank | Wife | 6,500.00 | 21,614.00 |
| 6. | Wine collection | Husband | 25,000.00 | Not agreed |
| 7. | Gun collection | Husband | 12,000.00 | Agreed |
| 8. | Monies in bank | Husband | Not known | E500.00 |
| 9. | Cleaning Business | Wife | Not agreed | Not Known |
| TOTAL | $1,264,000.00 | $1,255,820.00 | ||
| Liabilities | ||||
| 1. | Mortgage (CBA as at 12.07.2021) | Joint | 297,760.00 | Agreed |
| 2. | Viridian Line of Credit (as at 30.09.2021) | Joint | 205,528.00 | Agreed |
| 3. | Credit Cards (NAB and Company D) | Wife | 20,548.00 | Not agreed |
| 4. | ATO Tax Debt | Wife | 5,591.00 | Not agreed |
| 5. | Personal Loan | Husband | Not agreed | 25,000.00 |
| 6. | Credit Cards (ComBank, NAB, Macquarie) | Husband | Not agreed | 30,000.00 |
| 7. | Council Rates | Husband | 3,570.00 | 12,245.00 |
| TOTAL | $532,997.00 | $570,533.00 | ||
THE WIFE’S EVIDENCE
The wife adopted the terms of her Trial affidavit and Financial Statement during examination in chief.
During the course of her evidence in chief, the wife tendered a number of documents which she contended were the relevant figures which should be used for the value of certain items in the Schedule of Assets and Liabilities (‘the Schedule’). The wife also tendered the valuation of the former matrimonial home, prepared on the joint instruction of the parties by Company K (Exhibit W1). In response to questions put by her counsel, the wife gave evidence that the valuation of the said property was conservative and that she considered that the property if sold, it would likely achieve approximately $300,000.00 more if placed on the open market.
In addition to these matters, the wife also gave evidence in chief with respect to a wine collection, which the wife asserts was left in the former matrimonial home at separation. The wife did not ascribe a value to the wine collection, but referred specifically to a number of valuable bottles including “three bottles of N wine”.
The wife contended that the debt owing by her to the Australian Taxation Office with a current balance of $5,591.00 is the amount outstanding from the Financial Years ending 2015, 2016 and 2017 respectively. The wife gave evidence that she has paid some funds off the principal debt, including penalty interest. The amount paid off was not quantified.
In response to a number of matters raised in the husband’s Trial affidavit, the wife gave evidence in chief that a business called “Company J” asserted by the husband to have in fact been run by the wife, was in fact a business operated by the wife’s daughter. The wife denied that the sum $60,000.00 cash from the business was taken by her from the gun safe at separation. The wife’s evidence was that she did not open the gun safe at the former matrimonial home and that the husband had specifically refused to tell her where the key for the gun safe was located. The wife was adamant in her evidence both in chief and under cross examination that she did not remove the sum of $60,000.00, or any amount at all, from the gun safe at separation, as alleged by the husband.
The wife was then cross examined by the husband. The level of bitterness and hostility between the parties was in stark focus during this tranche of the Trial. On several occasions, the Court was required to intervene and to remind the parties that the exercise of cross examination was not an opportunity for the parties to argue with one another.
It was put to the wife by the husband that she had removed the wine collection at separation. This was vehemently denied by the wife.
The wife conceded that the entity known “Company J” was registered in her name. The wife denied that she had ever worked in the business or received income therefrom. The wife’s evidence is that the business was purchased to assist her daughter Ms O, who then met all outgoings and that other persons were employed to manage the business. It became apparent during this passage of cross examination that proceedings had been issued by the landlord against the wife in relation to the business premises. The wife agreed that those proceedings were instituted, but ascribed the reason for this as being as a result of the husband’s “maliciousness”.
In relation to the “business” the wife denied that the husband had worked in the business. The wife described the husband as “tagging along”. The wife agreed that the husband would assist on occasions in the display homes when she was required to work there. The wife vehemently denied that the husband was working with her on the occasion when the husband suffered a knee injury at Suburb P in 2014, although it is not disputed that the husband was present.
The husband then cross examined the wife with respect to her income during the relationship. The wife conceded that aside from a couple of payments, the mortgage had been largely paid by the husband. The wife’s evidence is that her income was used to pay household and children’s expenses. The wife was not challenged on those parts of her Trial affidavit that referred to her homemaking or gardening contributions.
Otherwise, the wife’s evidence supported the matters raised in her Trial affidavit.
THE HUSBAND’S EVIDENCE
The husband relied upon his Trial affidavit and Financial Statement.
In my view, husband in his oral evidence before the Court was inclined to emphasise his financial contributions during the marriage, whilst minimising the wife’s contributions. The husband was at pains to emphasise to the Court that he made most of the mortgage repayments and paid for household expenses. It is the husband’s assertion that the wife made minimal financial contributions to the marriage and therefore her overall contribution should be seen as less than his.
The husband contended that he assisted the wife in her business, which she established in or about 2006. It was whilst assisting the wife in her business that the husband asserts he sustained an injury in November 2014, whilst working at Suburb P. I do not consider that I am required to make a finding as to whether or not the husband was working for the wife on the day concerned. It was evident however that this incident and its sequalae is a source of bitterness and hostility by the husband towards the wife.
Under cross examination by the wife’s counsel Mr Bowler, the husband conceded that he has not paid the mortgage or the Viridian Line of Credit secured over the former matrimonial home since separation, aside from two payments totalling $3,600.00.
The husband conceded that the wife had not lived an extravagant lifestyle and it was not evident to him that she had purchased items such as expensive jewellery or clothing. The husband described the wife as being “very secretive” in terms of her finances. Ironically, this is the same complaint made by the wife against the husband. The husband contended that he had no idea what the wife did with her income, as he “never saw it”.
It was put to the husband by Mr Bowler on behalf of the wife that a sum of money had been held in the gun safe, which was “ear marked” for IVF treatment for the wife’s eldest daughter Ms O. The husband denied that the money was set aside for IVF treatment. The husband’s evidence is that he opened the safe and counted the funds, describing himself as “flabbergasted” on its discovery. The husband denied that the wife did not have access to the gun safe, but also conceded that he had not told the wife where the key for the gun safe was.
When it was put to the husband by Mr Bowler that all of the wife’s income from the business had been contributed towards the household as described in her Trial Affidavit, the husband replied that the wife’s contribution as being “very little”.
The husband was similarly uncomplimentary about the wife’s housekeeping skills. Whilst conceding that the wife undertook the majority of the cleaning, the husband went on to describe the wife as a “shocking cook”. According to the husband, the family lived on takeaway and barbecues. The husband agreed with the assertion put by Mr Bowler that he would describe the wife as “lazy”. When the husband was asked whether there was anything positive that he could say about the wife, the husband appeared reluctant to make any concession in this regard, and again referred to the fact he had “paid for everything”. Eventually, the husband conceded that the wife had been a good mother.
Mr Bowler on behalf of the wife spent a significant portion of his cross examination addressing the husband’s liabilities and capacity for refinancing. The husband’s evidence can be summarised in this way:
(1)That he currently receives a pension of about $950.00 per fortnight.
(2)The husband now proposes that he pay the wife the sum of $290,000.00. On the husband’s figures, this would see an adjustment in his favour of 53% and 47% to the wife.
(3)The husband’s evidence is that he has spoken to “the bank” and that they are prepared to “help” him as an “outstanding customer”. The husband’s evidence is that he has been “assured by the bank” that they would “assist” him. It should be noted that the former matrimonial home and the liabilities secured over the former matrimonial home are already in the husband’s sole name.
(4)The husband confirmed that he wished to retain the former matrimonial home and that he sought “a peaceful life”. When asked by Mr Bowler as to whether or not he intended to work once the Trial had concluded, the husband replied that he was “not sure about that”. The husband then considered it likely that he would be on a pension for the rest of his life and that he had “no intention to work again”.
(5)The husband asserted that a former business associate by the name of Mr M (‘Mr M’) will advance the funds necessary for the husband to pay all outstanding liabilities and the wife her settlement sum. In response to questioning by Mr Bowler, the husband described Mr M as an “investor” and that he had an ongoing business relationship with Mr M, which “goes back a long way” and in fact, predated his marriage to the wife.
(6)In relation to the $25,000.00 personal loan which appears in the Schedule, the husband’s evidence is that those funds were borrowed from a person by the name of Ms F (‘Ms F’) “about a year or two ago”. Ms F is also apparently a former client of the husband when he worked as a professional. The personal loan is unsecured and there are no documents confirming those funds. The husband described it as “a verbal agreement”.
(7)In relation to the monies which the husband asserts will be advanced by Mr M to pay out the wife and the monies outstanding to Ms F, the husband’s clear evidence was that those funds will be repaid when and if the husband is able to. Failing that, the husband asserted that his family would assist him if required. Neither Mr M nor Ms F gave evidence at Trial.
(8)In relation to the credit card debt for the cards in the husband’s sole name, the husband conceded that he had paid nothing off the credit cards since May 2017 and that the cards had been inactive since that time. The husband’s evidence is that he will borrow the sum of $30,000.00 to pay out the credit cards together with the mortgage and Line of Credit at settlement. The husband’s evidence is that he would not borrow money to repay Ms F. The husband described being able to repay the monies to Mr M and Ms F “at my leisure”. When challenged by Mr Bowler as to whether or not he would be able to service those loans in addition to paying out his wife a settlement sum, even at the amount proposed by him, the husband replied “I am confident that I can pay her out”. The husband described the wife’s opposition to him retaining the home as being “utter spite”.
(9)When cross examined about the council rates, the husband suggested that he had been paying the council rates since separation, namely the sum of $12.50 per week, as set out in his Financial Statement. The husband conceded that the balance for the council rates at separation was “high”. It was at this passage of the Trial that the husband then revealed to the Court that in or about 2018 the Region E Council had taken the repayment of council rates to Court. An agreement had been reached by the husband and the Region E Council at Court for the husband to repay the sum of $50.00 per month. The husband advised the Court that he had been meeting this repayment. I observe that nowhere in the husband’s Trial affidavit did he inform the Court of the Region E Council litigation.
(10)In relation to the wine collection at the date of separation, the husband denied that there had been three bottles of N wine. It is the husband’s position that there was no wine collection at separation at all. The husband denied the assertion that he had sold the wine at auction at Q Auctioneers under a pseudonym and retained the net proceeds.
(11)The husband agreed that the collection of guns in his possession had a value of $12,000.00.
(12)The husband agreed that the parties’ furniture and effects should be excluded from any calculation or adjustment. I will proceed on the basis that the husband no longer seeks the return of the items as set out in paragraph 7 of his Amended Response. The wife was not cross examined about it, it was not referred to in the husband’s Schedule and no were submissions made.
(13)In relation to the husband’s legal fees, the husband informed the Court that he was still waiting on a final account from his former solicitor. The husband has paid $1,500.00 to his former counsel Mr R. The husband had paid to his solicitor the sum of $12,000.00 approximately six to eight weeks prior to Trial, but was yet to receive an account from his former solicitors for the preparation of Trial documents. The husband’s evidence is that he would meet his outstanding his legal fees with the assistance of Mr M.
(14)The husband agreed that the wife could retain the Motor Vehicle 1. When asked by Mr Bowler, the husband refused to sign the transfer documents until such time as the Court made final orders.
(15)When it was pointed out to the husband that the wife had paid the sum of approximately $330.00 per week in rent since separation, the husband replied that this was “not my concern”. Mr Bowler vigorously challenged the husband with respect to the fact that he had lived mortgage free in the former matrimonial home since separation, whilst the wife paid rent. The husband’s evidence in reply was that he had undergone seven operations on his knee and had suffered a heart attack due to the wife. Consequently, the husband could not see that there was any detriment to the wife in terms of the financial obligations that they were both required to make post separation.
(16)The husband contended that his Motor Vehicle 3 would be worth $25,000.00 and not $29,000.00 as asserted by the wife.
(17)When cross examined with respect to his personal savings, the husband asserted that he currently had savings of approximately $500.00.
(18)The husband contended that he had paid a “balloon payment” in relation to the Motor Vehicle 3 in the sum of $25,000.00. There was no documentation provided by the husband when the Trial resumed on 22 November 2021 confirming the balloon payment. Rather, the husband produced a letter from S Bank to the husband dated 5 October 2020 (Exhibit H2), which does not refer to the payment of any sum of money. Mr Bowler submitted that the wife’s position is that the balloon payment should have been paid in 2017.
REVISED ASSET POOL
In relation to the Schedule of Assets and Liabilities above, it is appropriate that many of the Line Items be the subject of findings of the Court and in light of the parties’ evidence.
Assets
1. The former matrimonial home
The husband seeks to retain the former matrimonial home and pay the wife a settlement sum. The wife seeks that the said former matrimonial home be sold. The wife gave evidence in chief that the value of the former matrimonial is conservative. It is the wife’s personal opinion that the property would sell for $300,000.00 more than the valuation figure. Mr T, who conducted the valuation on the joint instruction of the parties, was not called at Trial. I place no weight on the wife’s personal opinion as to the potential sale price for the former matrimonial home.
The wife contends that the husband will not be able to take over the liabilities and pay her a settlement sum. The liabilities are already in the husband’s sole name. The wife is suspicious that the husband will seek to sell the property and if a fixed sum is payable to her, the husband will make a profit.
The husband contends that he has made a private arrangement with a Mr M to discharge the liabilities and pay the wife her settlement sum. Mr M is said by the husband to be a person known to him from his time working as a professional. The wife is critical of the husband failing to call Mr M at Trial.
The husband’s evidence is that the wife is opposing him retaining the former matrimonial home “out of spite”. The husband contends that it is important for him to retain the property because their son Mr H lives with him and is a student.
On balance, I consider that the husband should be given an opportunity to pay the wife a settlement sum. The husband has lived in the former matrimonial home since 1993. I do have reservations about the husband’s ability to service the level of debt he will be required to take on after orders are made by this Court. If however he is unable to pay the wife, then the former matrimonial home should be sold and the same percentage division apply to the net proceeds. In doing so, I propose to exercise my discretion in following the form of orders set out in Trask v Westlake.[8] In that way, any prejudice to the wife and the husband will be avoided.
[8] Traske v Westlake (2015) FamCAFC 160.
2. The husband’s motor vehicle
There was some confusing cross examination of the husband about the model of his motor vehicle and how this impacted on the value of the motor vehicle. However, in his final submissions, the husband agreed the value of the parties’ respective motor vehicles as put by Mr Bowler in his final address. I have entered them in the Schedule accordingly.
4. & 5. & 8. Personal savings
The wife seeks to exclude line items 4 and 5, being her personal savings with NAB and L Bank.
The wife asserts that these funds in her L Bank account represent the balance of a post-separation inheritance that she received from her brother in November 2020 in the sum of $55,000.00. The husband did not challenge this assertion and the wife was not cross examined on this topic. On 30 September 2021, the wife had a balance of $21,614.00 in her L Bank account. Her evidence is that the sum of $15,000.00 was withdrawn to pay legal fees. The current balance at Trial is $6,500.00 as evidenced by Exhibit W2. I accept the wife’s evidence that these savings represent a post separation inheritance. The parties separated nearly 5 years ago. The wife’s savings emanate from a post separation inheritance, to which the husband has made no contribution. I propose to exercise my discretion and exclude the wife’s savings for the purposes of arriving at a just and equitable property settlement in her L Bank account from the Schedule as I am entitled to do.[9]
[9] See Calvin & McTier (2017) FamCAFC 125.
The wife had $500.00 in her NAB account at Trial. The husband contends the amount should be $1,706.00. I propose to adopt the figure promoted by the wife, noting that not much turns on this item.
The husband did not include his savings in the Schedule at all. In his Financial Statement, he deposes to having approximately $300.00 in personal savings. Under cross-examination the husband considered he had savings of about $500.00. I have included this sum in the Schedule.
6. Wine collection
The wife asserted a value for the wine collection in the husband’s possession of $25,000.00. The husband disputes this. There is no other evidence as to the value of the said wine collection before the Court. The husband cross-examined the wife alleging that she removed the wine collection at separation. This was strongly denied by the wife in her evidence. The husband was cross-examined about having sold the wine collection post-separation under another person’s name. This was strongly denied by the husband. Mr Bowler conceded that there was no evidence of any value and no corroborative material. I therefore decline to bring this asset to account in the Schedule.
7. Wife’s business
The husband includes this entry in his Outline of Case. Otherwise, any reference to the value for a small business is not evident from the parties’ Trial documents. Nor was it the subject of cross examination or submission. I therefore exclude it from the Schedule.
Liabilities
1. Commonwealth Bank of Australia (‘CBA’) Mortgage
The parties are in agreement as to the mortgage balance with CBA in the sum of $297,760.00 at Trial. The controversy arises in relation to the mortgage balance at the date of separation which the husband conceded under cross examination was $242,528.00 on 30 June 2017. The husband conceded that since separation he has made only two repayments of $1,800.00 each to the mortgage being on 4 December 2017 and 2 January 2018 respectively. There has been a correlating increase in the CBA mortgage since the date of separation of $55,232.00.
2. Viridian Line of Credit
The parties are in agreement as to the current balance of the Viridian Line of Credit in the sum of $205,528.00 at Trial. The balance of the said Line of Credit on 1 May 2017, close to the date of separation, was $176,267.00 (rounded down), (Exhibit W4). There has been a correlating increase in the Line of Credit since the date of separation of $29,261.00.
3. Wife’s credit cards
The wife seeks to bring to account her personal NAB credit card in the sum of $20,548.00 as at 18 September 2021 (Exhibit W2). There is no separate independent evidence of a Company D credit card liability. The two credit cards appear together as the one line item. There is no evidence of the balance of those credit cards at separation. The wife was not cross examined on this topic. In circumstances where the evidence about the wife’s credit card debt at separation is non existent, I propose to exercise my discretion and exclude it from being the subject of adjustment.
4. Wife’s Australian Tax Office (‘ATO’) liability
The wife seeks to bring to account an ATO debt with a current balance of $5,591.00 (which includes penalty interest). This is opposed by the husband. The wife gave evidence in chief that this debt arises from the Financial Years ending 2015, 2016 and 2017. The wife’s evidence is that she has paid some money off the original debt. The specific sum paid by the wife was not provided to the Court. The wife tendered her Notices of Assessment for the Financial Years ending 2014-2019, but not evidence of the debt outstanding. The wife has continued to work as a cleaner post separation and received an inheritance post separation. At Trial, the wife had sufficient funds in her bank account left over from her inheritance to pay out this debt. I propose to exercise my discretion to exclude this liability from the Schedule as the evidence of the liability as at the date of separation is not clear.
5. Husband’s personal loan
The husband seeks to bring to account a personal loan in the sum of $25,000.00 obtained post-separation in or about 2019/2020. The wife opposes this. The husband’s evidence is that the sum was borrowed from Ms F in or about August or September 2020. Ms F is said to be a former client of the husband. There are no documents confirming the loan and the husband says it was a ‘verbal agreement’. The husband’s clear evidence is that he can pay this liability at his discretion and that he will not need to borrow money to repay it. I see no reason why this liability should be included in the Schedule. I therefore propose to exercise my discretion to exclude it from the Schedule. It is a post separation debt obtained by the husband without reference to the wife, and for what purpose was not made known to the Court in the husband’s evidence.
6. Husband’s credit cards
The husband seeks to bring to account his personal credit card debts in the sum of $30,000.00. This is opposed by the wife. The wife alleges chronic overspending by the husband on unnecessary items during the marriage. The husband stated that nothing had been paid off the credit cards since May 2017 and that the cards are not currently in use. The husband asserted under cross-examination that the relevant banks are “aware of what is going on” and have taken no steps to ensure repayment. Nor according to the husband’s evidence are the banks charging interest on the outstanding debts. The evidence on the husband’s credit card is unsatisfactory in a number of respects, including why he has no made effort to pay anything off the residual balance for close to five years. The husband contends he will borrow funds again from Mr M to meet these funds. In the circumstances, I propose to exercise my discretion to exclude this item from the Schedule.
7. Council rates
The husband seeks to bring to account outstanding council rates in the sum of $12,425.00. The wife concedes that the sum of $3,593.00 was owing to the council on 1 June 2017 near the date of separation. The husband disclosed at Trial that the non-payment of council rates had been the subject of litigation resulting in the husband agreeing to repay the sum of $50.00 per month. The husband asserted that he has been meeting these repayments. I propose to use the amount owing at the date of separation in the sum of $3,593.00 in the Schedule. The husband has been in sole occupation of the home for almost five (5) years and seeks to retain this asset at Trial. No sensible explanation was provided by him as to how or why he has allowed this debt to increase to such a level that now exists. Given that the husband has been in occupation of the former matrimonial home since 2017, I find that he should be responsible for payment of the balance owing, being $8,832.00.
Additional Issues
1. Wife’s business
The husband included in his Balance Sheet an entry for the wife’s business as ‘NK’. The wife was not cross-examined about the so called value of her business. No valuation has been obtained. I accept the wife’s evidence that she hopes for retirement in the short term. I do not propose to include any value for this alleged asset.
2. $60,000 in the safe
Whilst not evident from the parties Trial affidavits, nor from their Case Outlines or Schedules, the husband alleges that the wife removed $60,000.00 from a gun safe in the former matrimonial home. This issue became a topic of contention when the husband cross-examined the wife. The wife strongly denied the allegation. I accept the wife’s evidence. Neither party included this amount in their Schedule and I therefore do not propose to include this as an asset.
3. Legal Fees
Neither party provided a Costs Notice in accordance with Rule 12.06 of the Federal Circuit and Family Court (Family Law Rules) 2021 (Cth). Neither party raised the issue of legal fees as an “add back” at Trial. The evidence on this topic is not clear. I therefore propose not to include paid legal fees in the Schedule.
Revised Asset and Liability Schedule
Based on the abovementioned findings, the Asset and Liability Schedule is as follows:
| Asset | Ownership | Value | |
| 1. | Former matrimonial home (Valuation) dated 1.09.2021 | Husband | 1,175,000.00 |
| 2. | Motor Vehicle 2 | Husband | 29,000.00 |
| 3. | Motor Vehicle 1 | Wife | 16,000.00 |
| 4. | Monies in bank – NAB | Wife | 500.00 |
| 5. | Monies in bank | Husband | 500.00 |
| 5. | Gun collection | Husband | 12,000.00 |
| TOTAL ASSETS | $1,233,000 | ||
| 1. | Mortgage | Joint | 297,760.00 |
| 2. | Viridian Line of Credit | Joint | 205,528.00 |
| 3. | Council Rates – as at 1 June 2017 | Joint | 3,593.00 |
| TOTAL LIABILITES | $506,881 | ||
| TOTAL NET ASSETS | $726,119 | ||
SUBMISSIONS
The wife’s submissions
Mr Bowler’s submissions were consistent with the wife’s Case Outline with respect to the wife’s contributions and any adjustments that might be brought to account pursuant section 75(2) factors.
Mr Bowler submitted that the narrowed asset pool was largely agreed in terms of value, save and except that:
(1)The wife sought the former matrimonial home be sold; and
(2)The wife sought that the entirety of her savings, both in the L Bank and NAB accounts respectively, be excluded from the pool.
Mr Bowler conceded that as there was no valuation of the wine collection, it should be excluded from consideration.
I was urged by Mr Bowler to reject the husband’s assertion that he could retain the former matrimonial home. I was urged not to accept the husband’s evidence in this regard. Mr Bowler submitted that the husband’s capacity to repay the loans was “nil”.
Mr Bowler referred to the increase in the Commonwealth Bank mortgage and the Viridian Line of Credit as a consequence of the husband’s failure to meet payment of those loans since separation. Mr Bowler submitted that the loans had “ballooned” due to the husband’s “complete and total incapacity” to meet repayments.
I was urged by Mr Bowler to reject the husband’s inclusion in the Schedule of a debt of $25,000.00 to Ms F and the $30,000.00 credit card debt. Mr Bowler submitted that there was no independent evidence of these sums and they should therefore be excluded.
Mr Bowler submitted that his client would concede that the amount of $3,570.00, representing the balance of the Region E Council rates at the date of separation, should be included as a joint liability with the balance to be paid by the husband, given that he had remained in the occupation of the home post separation.
In relation to contributions, Mr Bowler submitted that in the face of a 27 year marriage, the husband’s initial contribution (whatever that might be) should be “ignored” and that any such contribution, if I found in the husband’s favour, had been “eroded” during the course of the marriage.
Mr Bowler commented on the husband’s hostile demeanour during his evidence and the suggestion by the husband that he “did everything” to the exclusion of the wife. Mr Bowler submitted that the contributions made by the parties during the marriage were equal. Mr Bowler submitted that his client had worked hard, undertaking her business and raising the parties’ two children.
In relation to the alleged $60,000.00 said to have been removed by the wife from the gun safe at the date of separation, Mr Bowler submitted that the wife had no capacity to save money during the marriage, given her limited income and the fact that she utilised those funds for the family benefit. Furthermore, the wife’s evidence was that she did not know where the key to the gun safe was located, and was therefore unable to remove the money from there, even if she wanted to.
In relation to future needs, Mr Bowler submitted that his client continued to work as a cleaner and earnt a modest income of approximately $30,000.00 per annum. The wife’s evidence was that she would retire within the next few months. Mr Bowler urged the Court not to make any adverse finding in relation to the wife’s decision to leave the workforce, noting her age and the fact that the husband is also effectively retired. Mr Bowler submitted that thereafter both parties will be in receipt of Centrelink benefits.
Mr Bowler submitted however that there should be an adjustment in favour of the wife, pursuant to section 75(2)(o) of the Act, on account the fact that the husband had failed to meet the loan repayments for the loans secured over the former matrimonial home since separation in 2017. Mr Bowler submitted that there should be a 10% adjustment in favour of the wife on account of the husband’s conduct, which he submitted amounted to the wife in effect maintaining the husband whilst not enjoying the benefit of the asset herself.
The husband’s submissions
The husband submitted that the value of the former matrimonial home and the parties’ respective motor vehicles were agreed. The husband submitted that the wife’s savings should be included, together with the value for his gun collection.
In relation to loan repayments, the husband urged me to accept that he had made arrangements to secure funding to payout the wife. The husband submitted that the wife was “hell bent” on selling the house. The husband submitted that he had paid extra money off the mortgage for a period of six years prior to separation. He submitted that he had not been able to work as a consequence of the injury suffered when purportedly working for the wife.
The husband submitted that the wife was meant to pay the council rates, but had failed to do so and as a consequence, the arrears had then accrued.
In relation to the alleged $60,000.00 in the gun safe, the husband submitted that the money had been acquired by the wife from the Company J Business and urged me to accept that the wife knew where the keys were and that the wife would “help herself to cash”.
In relation to contributions, the husband submitted that the wife “contributed nothing” to the home and that he “paid for everything”.
The husband submitted that he wanted to retain the former matrimonial home and the wife was aware of his strongly held desire in this regard. The husband submitted again (as he had stated in his evidence) that the wife was opposed to him retaining the property “out of spite”.
In relation to the wife’s income, the husband observed that the wife had earnt approximately $30,000.00 in the last financial year. The husband submitted that he considered that the wife earnt more than her stated income, as she received cash. The husband refuted that the wife suffered from ill health, which might persuade the wife to give up work. The husband submitted that the wife “always had high blood pressure and arthritis”.
APPLICABLE LEGAL PRINCIPLES
Part VIII of the Family Law Act 1975 (Cth) (‘the Act’) governs property, spousal maintenance and maintenance agreements as it relates to married parties.
Section 79(1) of the Act provides:
(1)In property settlement proceedings, the court may make such order as it considers appropriate:
(a) in the case of proceedings with respect to the property of the parties to the marriage or either of them--altering the interests of the parties to the marriage in the property.[10]
[10] Family Law Act 1975 (Cth) s 79(1).
Section 79(2) provides:
That the Court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.[11]
[11] Ibid s 79(2).
In considering what order (if any) the Court should make pursuant to section 79(1) of the Act, there are a range of factors that are to be taken into account. These factors are:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e)the matters referred to in subsection 75(2) so far as they are relevant; and
(f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.[12]
[12] Ibid s 79(4).
Section 79(4)(e) requires the Court to consider the factors set out in section 75(2) of the Act. These are colloquially known as the ‘future needs’ factors and are:
(a)the age and state of health of each of the parties; and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant; and
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party's role as a parent; and
(m)if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
(naa)the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i) a party to the marriage; or
(ii) a person who is a party to a de facto relationship with a party to the marriage; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement that is binding on the parties to the marriage; and
(q)the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
The leading case as it relates to matrimonial property matters is the High Court decision of Stanford & Stanford.[13] In Stanford, the High Court confirmed that the interference with legal and equitable interests of parties must adhere to principled reason.[14]
[13] Stanford & Stanford (2012) 247 CLR 108 (per French CJ, Hayne, Kiefel and Bell JJ).
[14] Ibid [41].
In considering whether it is just and equitable to make an order where an application is made for property settlement, the High Court stated:
In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of martial property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable to make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).[15]
[15] Ibid [42].
In this case, I find it just and equitable to make an order for property settlement given the parties’ competing applications for property settlement.
CONTRIBUTIONS
Section 79(4)(a) and (b) – Financial Contributions
At the commencement of the relationship, the husband deposes to owning;
(a)A late model Motor Vehicle 4 which was subject to finance for an amount not disclosed;
(b)Furniture;
(c)Approximately $25,000.00 in savings.
(d)Superannuation of an unknown amount. The husband asserts that his superannuation was cashed in during the course of the relationship and used to pay towards household expenses and day to day living expenses.[16]
[16] See husband’s trial Affidavit filed 3 November 2021 at [8].
The wife deposes to owning a Motor Vehicle 5 and ‘a house of furniture’. The wife asserts that she had approximately $3,000.00 in savings. The wife admits that the husband owned a Motor Vehicle 4 which was subject to finance.
In 1989, a property was purchased at U Street, Suburb V in the sole name of the husband. The parties agree that the property was purchased in 1989 for the sum of $75,000.00. The parties also agree that the husband paid the deposit for the said property. The wife asserts that the deposit was $5,000.00. The husband provides no evidence as to the quantum of the deposit paid by him. The parties agree that after the property at U Street, Suburb V was purchased it was then occupied by the wife and her daughter Ms O.
The wife deposes that the parties made improvements to the U Street, Suburb V property including a pergola, carpeting, painting, a new kitchen and landscaping.
In 1993, the parties purchased the former matrimonial home for the sum of approximately $165,000.00. The husband asserts that he paid the deposit for the former matrimonial home in the sum of $20,000.00 with the balance of the funds being raised by way of secured mortgage. The wife admits that the U Street, Suburb V property and former matrimonial home were registered in the husband’s sole name ‘because he wanted it that way’.[17]
[17] See wife’s trial Affidavit filed 1 November 2021 at [16].
The former matrimonial home became the property occupied by the parties and their children until the final date of separation.
The husband deposes in his Trial Affidavit that his income was utilised towards the payment of household expenses, the mortgage and day to day living expenses. [18] The husband alleges that the wife retained her income with ‘minimal and sporadic contributions to the household finances’.
[18] See husband’s trial Affidavit filed 3 November 2021 at [23].
During the relationship the husband was employed as a self-employed professional. For a time, the wife also worked in the business as an office worker. Initially the wife worked full time but after a period of 2 years commenced working three days a week until approximately 2006. Thereafter the wife deposes to having only worked occasionally in the business.[19]
[19] See wife’s trial Affidavit filed 1 November 2021 at [21].
During the period from 2000 to 2008 the wife worked casually – approximately 20 hours a week in support work.[20] In 2006, the wife commenced work which she has continued until this day. After working as an employee initially, the wife then commenced her own business.
[20] Ibid at [22].
The husband agrees that in approximately 2006 the wife commenced her small business. The husband deposes to having assisted the wife in the business – initially on one night a week but ultimately for two to three hours per night.[21] The wife dispute the level of the husband’s involvement in her business.
[21] See husband’s trial Affidavit filed 3 November 2021 at [25].
Based on the evidence at Trial, I find that each of the parties worked hard during the course of their very long marriage and I accept the submission of Mr Bowler that each contributed their income to the family unit, but in different ways.
The wife asserts that the husband controlled the finances and was responsible for the payment of business expenses and mortgage payments.[22] The wife contends that her income was used to pay for household expenses such as food, holidays, car expenses, clothing, replacement items and day to day living expenses for the children.[23]
[22] See wife’s trial Affidavit filed 1 November 2021 at [24].
[23] Ibid [26].
The husband contends that his income was paid towards household expenses, the mortgage and other day to day living expenses.[24] The husband asserts that any income retained by the wife was minimal and that she made ‘sporadic contributions’ to the household finances.
[24] See husband’s trial Affidavit filed 3 November 2021 at [23].
I reject entirely the husband’s assertions in relation to the wife’s financial contribution. I find that the parties both contributed towards the running of the household, payment of bills and outgoings and the support of their family commensurate with the level of their income during the course of their very long relationship.
I also accept Mr Bowler’s submission that there is no evidence, nor an agreed position on either the husband’s initial savings or the deposit paid by him for their first home in 1989.
Section 79(4)(c) – Contributions to the welfare of the family
The parties raised two children. The wife deposes in her Trial affidavit to undertaking all of the housework.[25] The wife alleges that the husband thought ‘it was not his place to do anything’. The wife concedes that the parties shared the cooking with the husband cooking what the wife described as ‘a lot of barbecues’. The wife admits that the parties both shared the responsibility of looking after and caring for the children.[26] I reject the husband’s criticisms in his evidence of the wife’s homemaker role. The husband eventually conceded under cross examination that the wife had been a “good mother” to the parties’ two children.
Section 79(4)(d) – The effect of any proposed order upon the earning capacity of either party to the marriage
[25] See wife’s trial Affidavit filed 1 November 2021 at [27].
[26] Ibid.
Not relevant.
Contribution Conclusion
I find, based on the evidence available to me at Trial, that the parties have both made equal contributions to the acquisition, conservation and improvement of the parties’ property and to the welfare of their family over a very long marriage. Both parties made equal contributions of the nature described, albeit in differing ways at differing times depending on the ages of the children and their employment at the time. There is no evidence about the quantum of the husband’s initial financial contribution in or about 1989 when cohabitation commencement. Any initial contribution must be seen against the contributions made by both parties until final separation in 2017.[27] Furthermore, “the weight to be attached to the husband’s initial contribution is to be assessed against the rubric of all contributions made by the parties”. [28]
[27] See Bremner & Bremner (1995) FLC 92-560; Money & Money (1994) FLC 92-485; Pierce & Pierce (1999) FLC 92-844.
[28] Jabour & Jabour [2019] FamCAFC 78; (2019) FLC 93-898, (2019) 59 Fam LR 475.
SECTION 75(2) ADJUSTMENT
In November 2014, the husband sustained an injury. The husband asserts that he was assisting the wife in her business on a job at Suburb P. As a consequence of his injuries, the husband asserts that he has required major surgery resulting in loss of income and ability to work. The husband alleged that he is ‘in constant daily pain and his prognosis is guarded’. The husband did not produce any independent medical evidence in this regard.
The husband deposes to now suffering poor health and experiencing ongoing heart problems.[29]He asserts that he continues to suffer from insomnia, ongoing stress and depression.[30] The husband is reliant on Centrelink benefits.
[29] See husband’s Trial affidavit filed 3 November 2021 at [50].
[30] Ibid.
The wife continues to work in her business and deposes to earning approximately $700.00 per week. The wife’s unchallenged evidence is that due to her health issues and age, she will unlikely to be able to continue working in her business for much longer. The wife deposes to an expectation that she will retire within the next few months. At the age of 68 years, this is not an unreasonable expectation, especially given the physical demands of her work.
Neither party owns any superannuation.
Since separation the wife has rented privately and currently pays $316.00 per week. The husband has continued to reside in the former matrimonial home, which he seeks to retain. In paragraph 5.7 of the husband’s Outline of Case document it is said that the husband has maintained the former matrimonial home and serviced expenses in relation to the home, excluding the mortgage, of which the respondent was in advance of the payments. It is asserted by the husband that this is a significant post-separation contribution.
The evidence however is very different. Since separation, the husband has:
(a)Increased the debt levels in relation to the former matrimonial home by $84,521.00;
(b)Failed to pay council rates other than an amount agreed of $50.00 per month after the Region E Council issued enforcement proceedings against him. The outstanding Council rates have increased by $8,832.00 since separation; and
(c)Failed to make any payment towards his outstanding credit card liability.
The wife argues that the husband has deliberately embarked on a course of conduct designed to reduce or minimise the effective value or worth of the matrimonial assets of the kind identified in Kowaliw.[31]
[31] Kowaliw & Kowaliw (1981) FLC 91-092; Also see Browne v Green (1999) FLC 92-873; AJO & GRO (2005) FLC 93-218.
The wife seeks an adjustment of 10% in her favour because of the husband’s failure to meet the mortgage repayments or Viridian Line of Credit since separation. There has been a consequent reduction in the equity of the said former matrimonial home in the sum of $84,521.00.
In this case, the wife has made a contribution to the husband’s post separation maintenance by allowing him to exclusively occupy their home at no cost, similar to the case of Carron & Laninga.[32] As was identified in the Full Court decision of Lalor,[33] the Court has a discretion to make property settlements and rules for the exercise of that discretion should not be formulated.
[32] Carron v Laninga [2019] FamCAFC 115; (2019) FLC 93-909.
[33] Lalor & Lalor (1989) FLC 92-164.
I find that it is appropriate to exercise my discretion and that there should be a 10% adjustment in her favour accordingly, taking into account all relevant section 75(2) factors.
THE OVERALL EFFECT OF THE ORDERS
My assessment of the parties’ contributions and the section 75(2) factors lead me to a conclusion that the parties’ net assets should be divided 60% to the wife and 40% to the husband.
The net non-superannuation pool is $726,119.00. The wife’s entitlement is $435,671.00. The wife will retain her motor vehicle at $16,000.00 and her savings of $500.00. This will require the husband to pay to the wife the sum of $419,171.00 to make up her proper entitlement.
In the event that the husband cannot borrow the funds from Mr M to meet the wife’s entitlement, then the former matrimonial home shall be sold, with the wife to still receive 60% of the net assets after bringing to account the $16,500.00 worth of assets to be retained by her. This will avoid the prejudice which will be occasioned to her if the Court simply orders a fixed sum and then the husband sells the home for a price in excess of that ascribed in the joint valuation. Given that the husband is borrowing the funds privately from a friend and does not need to make any formal application for finance, I will allow 30 days for the wife to be paid her settlement sum. The husband has not sought a time for payment in his Amended Response.
JUSTICE AND EQUITY
I am satisfied that given the length of the marriage, the parties’ contributions throughout the marriage and my findings thereon and the section 75(2) factors that the orders set out herein providing for an adjustment of the parties’ property interests are just and equitable.
CONCLUSION
For all of the above reasons, I make the orders as set out at the commencement of this judgment.
I certify that the preceding one hundred and twenty-two (122) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Dickson. Associate:
Dated: 28 January 2022
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