Da Gama & Fabien
[2025] FedCFamC1F 21
•6 February 2025
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Da Gama & Fabien [2025] FedCFamC1F 21
File number: MLC 7136 of 2020 Judgment of: MCGUIRE J Date of judgment: 6 February 2025 Catchwords: FAMILY LAW – PROPERTY – Application by husband for alteration of property interests – Significant dispute and difference in parties’ views as to contents of the property pool – Lack of forensic accounting evidence – Not for judge to assume experts role - Add-backs – Orders that ultimately give the husband 58.55 percent of the value of the property pool Legislation: Family Law Act 1975 (Cth) s 79(2) Cases cited: Carlson & Carlson [2019] FamCAFC 245; (2019) FLC 93-934
C & C [1998] FamCA 143
Dawes & Dawes (1990) FLC 92–108
Elias v Elias (1977) FLC 90-267
Horrigan & Horrigan [2020] FamCAFC 25
Jordan & Jordan (1997) FLC 92-737
Kowaliw & Kowaliw (1981) FLC 91-092
Marker & Marker [1998] FamCA 42
Nelson v Nelson (1995) 184 CLR 538
Norbis v Norbis (1986) 161 CLR 513
Omacini & Omacini (2005) FLC 93–218
R v Watson: Ex parte Armstrong (1976) 136 CLR 248 at 257; [1976] HCA 39
Stanford & Stanford (2012) 247 CLR 108; [2012] HCA 52
Trevi & Trevi (2018) FLC 93–858
Watts G, Lies, Damned Lies and Tax Returns – Television Education Network – November 2000
Division: Division 1 First Instance Number of paragraphs: 102 Date of last submissions: 6 November 2024 by Microsoft Teams to Hobart Date of hearing: 29, 30, 31 October and 1 November 2024 Place: Melbourne Counsel for the Applicant: Mr Lethlean Solicitor for the Applicant: Mark M Morgan Solicitors Counsel for the Respondent: Ms Finemore Solicitor for the Respondent: Velocity Legal ORDERS
MLC 7136 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR DA GAMA
Applicant
AND: MS FABIEN
Respondent
ORDER MADE BY:
MCGUIRE J
DATE OF ORDER:
6 FEBRUARY 2025
THE COURT ORDERS THAT:
1.Within seven days, the parties do all acts and sign any documents necessary to direct D Lawyers to release the net proceeds of sale of the Suburb B and Suburb C properties held in the D Lawyers Trust Account in the sum of $375,939.08 plus accrued interest to the parties as follows:
(a)50 per cent to the solicitors for the wife; and
(b)50 per cent to the solicitors for the husband.
2.Save as is otherwise provided for in these Orders, the wife retain her right, title and interest in the following property to the exclusion of the husband:
(a)the property at E Street, Melbourne, Victoria;
(b)the property at F Street, Suburb G, Victoria;
(c)the property at H Street, Melbourne, Victoria;
(d)the balance of any bank accounts or like investments held in the name of or to the benefit of the wife as at the date of these Orders;
(e)any personalty, furniture and chattels in the possession or control of the wife as at the date of these Orders;
(f)her superannuation entitlements; and
(g)the part property settlement payment in the total sum of $80,000.
3.Save as is otherwise provided for in these Orders, the husband retains his right, title and interest in the following property to the exclusion of the wife:
(a)the property at J Street, Suburb K, Queensland;
(b)the property situated at L Street, City M, Region N, Country O;
(c)his interest and shareholding in P Pty Ltd (ACN …) including any assets of the Company;
(d)the balance of any bank accounts or like in the name of or to the benefit of the husband as at the date of these Orders;
(e)the proceeds of sale received from Motor Vehicle 1;
(f)the proceeds of sale received from the sale of the two watches;
(g)any personalty, furniture and chattels in the possession or control of the husband as at the date of these Orders;
(h)his superannuation entitlements; and
(i)the part property settlement payment in the total sum of $80,000.
4.The wife be solely liable for and indemnify the husband against any liability in the wife’s name or encumbering any item of property to which the wife is entitled pursuant to these Orders, howsoever arising, past, present and future, including but not limited to:
(a)the ANZ mortgage encumbering the property at E Street, Melbourne, Victoria; and
(b)the ANZ mortgage encumbering the property at H Street, Melbourne, Victoria.
5.The husband be solely liable for and indemnify the wife against any liability in the husband’s name or encumbering any item of property to which the husband is entitled pursuant to these Orders, howsoever arising, past, present and future, including but not limited to the ANZ mortgage encumbering the property at J Street, Suburb K, Queensland.
6.Within 7 days from the date of these Orders the husband at his sole expense withdraw the following caveats:
(a)Caveat … lodged on the property at H Street, Melbourne, Victoria and more particularly described as Volume … Folio …;
(b)Caveat … lodged on the property at F Street, Suburb G, Victoria and more particularly described as Volume … Folio …; and
(c)Caveat … lodged on the property at E Street, Melbourne, Victoria and more particularly described as Volume … Folio ….
7.Pursuant to s 81 of the Family Law Act 1975 (Cth) the parties intend that these Orders shall as far as practicable finally determine the financial relationship between them and avoid further proceedings between them.
8.All extant property and financial applications be dismissed except costs applications between the parties, if any, which are to be dealt with in accordance with the Family Law Rules 2021 (Cth).
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).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of 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 the pseudonym of Da Gama & Fabien has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
McGUIRE J:
APPLICATIONS
These are property proceedings pursuant to s 79 Family Law Act 1975 (Cth) (“the Act”) between the parties to an extremely short relationship of some three years and two months incorporating a marriage of just two years and two months.
Both parties are of Country O origin. The husband, Mr Da Gama, has been in Australia since 2006. He is a permanent resident. He continues to spend much time conducting his business in Country O. His immediate family live in Country O.
The wife, Ms Fabien, also came to Australia in 2006 and as a student. She became an Australian citizen in 2013. She maintains strong family links to Country O.
It is not a simple task to identify the positions of the parties in the alteration of their property pool. Prominently, there is a significant discrepancy in their views as to the content of the property pool and more so as to their various contributions.
The wife’s fundamental argument is that two pieces of real property being J Street at Suburb K, Brisbane in Queensland and L Street, City M, Region N in Country O (total equity $858,000) and both registered in the husband’s name be included in the pool. The husband says that he is not the beneficial owner of either property.
Secondly, wife also argues for a number of add-backs to the pool totalling, on my calculations, $334,519 to be attributed to the husband’s side of the ledger.
If the wife’s argument as to the contents of the property pool is successful then she concedes 10 per cent of that pool to the husband on the basis of superior contributions. The wife then argues, however, that she “claw back” 10 per cent of the pool on account of relevant s 75(2) considerations being primarily her limited work capacity.
Neverthless, the orders sought by the wife are that the proceeds of sale of two properties formerly owned by the parties at Suburb B and Suburb C held in trust and amounting to $375,939.08 be divided equally between the parties at $187,969.54 each and that each of the parties otherwise retain those items of property in his or her possession.
This proposal clearly includes the two real properties at Suburb K and Region N with claimed add-backs into the property pool. Such orders, on the wife’s pool would, in fact, give the husband approximately 65 per cent of the net property pool or a considerable percentage above the 50/50 division fundamentally argued by the wife. Her counsel says she is prepared to accept orders on this basis and again primarily dividing the trust monies of $375,939.08 equally.
The husband says that he should receive 60 per cent of the property pool. He argues for a 10 per cent loading to him on account of superior contributions during the relationship and there being no adjustment to either of the parties after consideration of the s 75(2) factors.
The husband’s proposal is based on the two relevant real properties at Suburb K and Region N not being included in the property pool and he concedes only a $5,000 add-back to his side of the ledger being the proceeds of sale of Motor Vehicle 1 retained by him at separation.
Conversely, and further complicating this matter, is that the husband himself argues for numerous add-backs to the property pool to be attributed to the wife’s side of the ledger and as detailed in his trial affidavit at [98] and which I calculate to total E$520,000.
Should the Court, however, determine that the two relevant pieces of real property be included as assets in the property pool and in the hands of the husband then the husband’s counsel in final submissions is unprecise in his mathematics but suggests that the husband’s contributions may be as high as 80 per cent of the property pool.
ISSUES
There is a major issue between the parties as to the content of the property pool with specific reference to the two real properties, both registered in the name of the husband, and situate at J Street at Suburb K, Queensland (“Suburb K”) and L Street, City M, Region N, Country O (“Region N”). The husband denies a beneficial interest in both properties.
The wife argues for add-backs to the pool to the husband’s side of the ledger of $334,518. The husband argues for add-backs to the property pool of around $520,000. With one small exception, each of the parties denies the others claim for “add backs”.
It is proper to note and emphasise at this point that neither party sought the appointment of a single expert forensic accountant. Neither party adduced evidence of any accounting type. Each of the parties alleges against the other, however, significant complex transfers of monies (and some assets) internationally. Each asserts against the other a lack of proper discovery/disclosure. Each provides copious and broadly based bank statements which generally proved to be unsuccessful, unreliable, and of little assistance in the forensic exercise of proving each of their cases against consistent denials or explanations of the other party. If either party would seek to rely on s 50 of the Evidence Act 1995 (Cth) towards their affidavits and exhibits providing a summary of “proof of voluminous and complex documents” then I reject any such submission. It is one thing to provide the Court with an informed, accurate and reflective summary but altogether another to simply “cherry pick” transactions, provide the Court with copious bank statements, and then ask the Court to assume the role of expert forensic accountant where, notably, many of the asserted transactions are met by the other party with responses of such monies being either reversed, transferred to other third parties or representing gross receipts only but which contain disbursements. Nevertheless, it remains for the Court to make findings of fact in so far as it can on the basis of the evidence such as it is.[1]
[1] Carlson & Carlson [2019] FamCAFC 245; (2019) FLC 93-934 [20], [25-27] and [35].
As indicated to counsel for both parties on a number of occasions during the course of the trial and their final submissions, it is for a party coming to this Court to discharge the onus of proof to the requisite standard of proof. Put simply, a party making an assertion of fact has an onus to give and adduce evidence of sufficient probity to prove that assertion of fact. It is not for the Court to assume the role normally the province of an expert such as a forensic accountant. It is not for the Court to speculate in its fact-finding function. It should not be expected of a judge of this Court to trawl through literally thousands of pages of bank statements in a “tracing exercise”. It is not the function of this Court to make assumptions, presumptions, and conclusions masquerading as an expert. Similarly, proof is rarely attained simply by an assertion of a monetary transaction in an affidavit supported by a transaction of equal quantum in a bank statement. For instance, in this matter the wife references incomings to the husband’s business bank account and asks the Court to accept them in their gross form. Not surprisingly, the husband plausibly responds that the same bank account might include disbursements for tuition fees, Visa applications and the like. In a further example the wife points to a deposit of funds into the husband’s bank account with the implication that this be an asset. The husband responds with a convoluted explanation, not previously proffered, that he and his bank account were being used as some form of intermediary between this Country O based father and mother to effect some form of property settlement following their separation or divorce.
Given the difficulties set out above, it is notable, however, that each of the parties do make some limited admissions in respect of transfers in and out of accounts. Other assertions range from the plausible, to the unlikely, to the incredible.
There is an issue as to the wife’s claim for an adjustment under s 75(2) of the Act by reason of her asserted limited work capacity which she implies has a nexus from the husband’s family violence, mainly of the coercive, controlling and/or emotional type, but where there are other facts which might contribute to her depression diagnoses including the death of the parties’ infant child.
The issues were made far more complex and confused in their hearing determination by the requirement for interpreters.
Where the parties’ superannuation entitlements are minimal albeit with some discrepancy between the parties, counsel for each indicated that I need not consider any alteration or consideration of superannuation and given the very short duration of the relationship I agreed to this approach.
BACKGROUND
The wife was born in Country O. She is 42 years of age. She has lived in Australia since 2006 and is an Australian citizen.
The wife works three days per week as a professional with a state government department. She earns $54,000 per annum supplemented by rental income. The wife has qualifications as a finance professional.
There is no evidence before me that the wife has re partnered in any financially dependent or supportive way.
The wife asserts a number of health issues including diagnoses of mental health disorders.
The husband is 40 years old. He too was born in Country O. He too came to Australia in 2006. He maintains family business interests and family connections in Country O.
The husband is self-employed through a complex corporate and business structure (at least historically). His business is to assist others from Country O in Australia.
There is no evidence that the husband is other than in good health.
The husband is remarried to Ms Q. They have a child born 2020. Ms Q is a student. She is the owner of two residential properties in Brisbane. The husband and his family live in one of those Brisbane properties.
The husband deposes at [96] of his trial affidavit and in his sworn financial statement of a taxable income of $400 per week from his business. The financial statements of the business show a gross income closer to $250,000 per annum. The husband receives benefits from the business.
The parties commenced a relationship in about mid-2016. They married in 2017. They separated on 7 July 2019 when the husband vacated the former matrimonial home at Suburb B.
In 2019, the parties’ daughter X passed away.
The parties were divorced in late 2020.
Each of the parties has received $80,000 partial property settlement/litigation funding by instalments of $40,000 to each on 23 March 2021 and 22 July 2021.
RELEVANT LEGAL PRINCIPLES
The Court derives power to alter the property interests of parties from s 79 of the Act.
“Property” includes both assets and liabilities with amendments to the Act providing that “superannuation may be treated as property”. In R v Watson: Ex parte Armstrong[2] the High Court noted the broad discretion in the Court being limited only by the Statute itself in the stating:
…The judge called upon to decide proceedings of that kind is not entitled to do what has been described as “palm tree justice”. No doubt he is given a wide discretion, but he must exercise it in accordance with legal principles, including the principles which the Act itself lays down. …
[2] (1976) 136 CLR 248 at 257; [1976] HCA 39.
Significantly, s 79(2) of the Act provides:
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.
The High Court in Stanford & Stanford[3] brought a renewed focus to this subsection in emphasising the requirement for a separate, independent and discrete determination by the Court as to whether it be just and equitable in the particular circumstances of the case to make any order altering the property interests of the parties. Importantly, that consideration is not to be simply conflated with the consideration of contributions at s 79(4).
[3] Stanford & Stanford (2012) 247 CLR 108; [2012] HCA 52.
The consideration in this matter at s 79(2) does not present difficulties. Although the relationship was a short one, it is highlighted the by the intermingling of the parties’ monies and bank accounts. Indeed, the process for the Court may have been much simpler if it was able to make the consideration on the alternative of a “asset-by-asset” basis.[4] Sadly, that option is not reasonably available to this Court. These parties have separated and divorced. They each claim entitlement to monies held in trust from the proceeds of sale of joint property. Where their finances have been inherently entwined, I can easily find it is just and equitable to enter into a consideration of altering their property interests.
[4] Norbis v Norbis (1986) 161 CLR 513.
The first task of the Court is to identify the contents of the property pool and to attribute value. It is here that there is significant dispute between the parties who each argue for significant “add-backs” and also by the wife as to the inclusion of two pieces of real property where the husband holds the title but claims not to “hold” the beneficial interest. Generally, however, subject to these disputes, the parties agree valuations.
After establishing the contents and value of the property pool, the Court turns to s 79(4) of the Act to consider the various contributions made by and on behalf of the parties to the acquisition, conservation and/or improvement of the contents of the property pool. Contributions can be of a direct or indirect financial type. Contributions can be of a non-financial type including as home maker and parent. The significant dispute between the parties here is as to the veracity of claimed financial contributions by and on behalf of each of them together with the quantum of such contributions and the weight to be attributed to such contributions. Put simply, each claim a plethora of financial contributions made directly, indirectly, and on their behalf by various family members and third parties most of whom did not give evidence to this Court. Each disputes the veracity of the claimed financial contributions of the other. Limited concessions and admissions only are made. It is here that the forensic preparation and presentation of trial is seriously lacking and where the process would have been assisted by expert evidence.
The Court then turns to consider whether there should be any further adjustment to either of the parties on account of the considerations at s 79(4)(d)-(g) including relevant factors at s 75(2) of the Act. In this matter the husband says that the circumstances of the parties are such that there should be no adjustment to either of them. The wife claims a 10 per cent adjustment to her on account of limited work and earning capacity.
The entirety of the process above is permeated on an understanding of justice and equity.
THE RELEVANT LAW - ADD-BACKS
The Full Court in Trevi & Trevi[5] confirmed the authorities and guidelines for making add‑backs to a property pool at trial noting first that a previous Full Court in Omacini & Omacini[6] saw add-backs as falling into “three clear categories” where firstly, the parties have expended money on legal fees; secondly, where there has been a premature distribution of matrimonial assets; and thirdly where there has been waste or wanton, negligent, or reckless dissipation of the assets.[7]
[5] (2018) FLC 93-858 (“Trevi”).
[6] (2005) FLC 93-218.
[7] Kowaliw & Kowaliw (1981) FLC 91-092.
The Full Court in Trevi emphasised, however, that the mere expenditure of money or dissipation of an asset does not necessarily result in an add-back describing such a proposition as “unduly simplistic” and confirming the statement of an earlier Full Court in C & C[8] that making an add-back might be “the exception rather than the rule”.
[8] [1998] FamCA 143.
Where prima facie a trial Judge is normally to take the property of the parties to a marriage as found at the trial and where noting that the parties do not “go into a state of suspended economic animation” after separation,[9] it follows that reasonably incurred expenditure will not, as a matter of course, be added back to the property pool. In this sense, the making of an add-back is very much a discretionary exercise on the circumstances of the case and where justice and equity might require there to be an add-back. Notably, the Court in Trevi identified an alternative course for trial judges in dealing with the dissipation of assets or expenditure from joint funds and as follows:
30.…The second premise is its corollary: in cases that are not “exceptional” justice and equity can be achieved, not by adding back, but by the exercise of a different discretion – usually by taking up the same as a relevant s 75(2) factor. Indeed, it has been said that the latter is “a course which is, perhaps, technically more correct” than adding back to the list of existing interests in property.
[9] Marker & Marker [1998] FamCA 42.
Nevertheless, it is generally accepted that the expenditure on legal fees by a party from joint funds or funds that existed at separation will result in an “add-back” as distinct from funds used to pay legal fees which have been generated by a party post-separation either through their remunerative employment or by personal borrowings. In my view, it is also simpler to include in the list of assets any “partial property entitlements”, as in the $80,000 received by each of the parties here.
CONSIDERATION OF THE ISSUE OF THE HUSBAND’S ASSERTED OWNERSHIP OF PROPERTIES AT SUBURB K, BRISBANE, QUEENSLAND AND REGION N, COUNTRY O – “ELIAS PRINCIPLE”
The husband holds the titles to both properties. He says that he is not the beneficial owner of either. Nevertheless, in respect of the property at Suburb K, he concedes that he has historically claimed tax deductions by reasons of the property being tenanted together with a mortgage and hence it being negatively geared. As indicated to the husband’s counsel during submissions, this raises an issue of the “Elias principle.”[10] The “principle” is essentially one of admissibility of evidence or evidence estoppel. The original “principle” is identified in a subsequent judgment of Jordan & Jordan[11] which considered the effect of “Elias” as:
When a party has made representations of fact to third parties and has gained advantage from so doing, it is open for the court in subsequent proceedings under section 79 of the Family Law Act to decline to accept from that party evidence which contradicts those representations.
[10] Elias v Elias (1977) FLC 90-267.
[11] (1997) FLC 92-737 at p 83, 927.
The principle in “Elias” appears to have received endorsement and support in subsequent cases including in the Full Court in Dawes v Dawes[12] where their Honours say:
… that a party to proceedings in this Court cannot be allowed to have his cake and eat it too. If, during the course of the marriage, the party represents to the Commissioner of Taxation that his or her spouse is a partner in a business operated by that party, or is a bona fide employee of such a business and is paid a salary as such, that party cannot be heard to say, in subsequent proceedings in this Court, that his or her spouse was not in fact a partner or was not in fact a bona fides employee, as the case may be… We think that it is a very sound principle, and its enunciation by Goldstein J in Elias & Elias (supra) was given at least tacit approval by the Full Court in Lee Steere and Lee Steere (1985) FLC 91–626 at p 80,078. We are aware that it has received more explicit approval by other Judges at first instance in unreported cases.
[12] (1990) FLC 92–108 at p 77,725.
Later jurisprudence cast doubt on the status of Elias as “principle” or being mandatory. Chisholm J in Jordan & Jordan (supra) did not apply such a principle in circumstances where the husband had not relied on the representation of the wife and that such representation was by a single statement rather than course of conduct. His Honour considered the proportionality of potential penalty from the prior false misrepresentation as against the advantages gained. Chisholm J stated at [83,925]:
In these circumstances, it is necessary to consider the basis of the Elias principle. For reasons already given, while it may well be that the facts of such cases as Elias would justify a decision based on equitable estoppel, the rule acted on in the Family Court authorities is not expressly based on reliance, and it would do violence to the language of the decisions (and the actual decision in Cestaro) to limit it to circumstances falling within the equitable principles. It follows, I think that the basis for the rule must lie in the Family Law Act: as argued by the husband, it is a rule specific to family law.
In a helpful publication, Garry Watts (later Watts J)[13] in discussing Jordan & Jordan (supra) and the finding of Chisholm J that the rule is discretionary not absolute, summarised such application of the “Elias principle” from Chisholm J as:
[13] Lies, Damned Lies and Tax Returns – Television Education Network – November 2000.
• The “Elias principal” is a rule of law not just an evidentiary presumption.
•Reliance is not an essential element of the rule and as a result the rule is much wider than the concept of equitable estoppel.
•The rule is not confined to parties who simultaneously assert inconsistent propositions.
•The rules is not limited to some categories of representation.
•The rule does not require a course of conduct, a single representation will suffice.
•The rule is not limited to representations to revenue authorities.
•Because the principal has no basis in the general law, it is a rule specific to family law.
•The rule therefore must be based upon one or more of the following:
•Section 79(2) of the Act – the just and equitable principal.
•The well established full and frank disclosure principle.
•Section 75(2)(o) of the Act – that is, any other matter the justice of the case requires.
•And – the key aspect in the Jordan case – that the rule must be discretionary not absolute.
Contemporaneously with the decision in Jordan, the High Court considered such an issue in Nelson v Nelson[14] as to whether a person could give evidence to rebut the presumption of advancement after placing a property into the names of her children to conceal the asset from a government means test. McHugh J opined contrary to the strictness of Elias in formulating the following:
… the courts should not refuse to enforce legal or equitable rights simply because they arose out of or were associated with an unlawful purpose unless: (a) the statute discloses an intention that those rights should be unenforceable in all circumstances; or (b)(i) the sanction of refusing to enforce those rights is not disproportionate to the seriousness of the unlawful conduct; (ii) the imposition of the sanction is necessary, having regard to the terms of the statute, to protect its objects or policies; and (iii) the statute does not disclose an intention that the sanctions and remedies contained in the statute are to be the only legal consequences of a breach of the statute or the frustration of its policies.[15]
[14] (1995) 184 CLR 538 at p 613.
[15] Footnote omitted.
As Garry Watts observes in his publication, it seems that the contemporaneity of Jordan and with Nelson, resulted in Chisholm J not being made aware of the High Court’s decision in Nelson.
I am generally satisfied, therefore, that the “Elias principle” represents a rule of law specific to the Family Law Act 1975 but to be applied together with a discretion commensurate with the facts and circumstances of each case. Whilst mindful of the equitable principle that “a party must come to equity with clean hands”, equally there remains the general principle of justice not only being done but being seen to be done. Consequently, the strictness of such a contradictory statement being inadmissible as articulated in Elias is no longer, in my view, good law but where importantly the admission of evidence does not preclude the testing of same by cross-examination and the Court to consider the veracity of an assertion of fact by a party against the contradictions of factual declarations by that same party.
In respect of the Suburb K property, certain inferences are available to the Court consistent with the husband’s ownership of that property. The title is in his name. The mortgage is in his name. I can easily presume certain statements of ownership were made by the husband to the bank. There is no evidence of any other person’s entitlement noted against the title. Similarly, the husband has claimed tax deductions in respect of the property consistent with his ownership.
The husband attempts to rebut the presumption of his ownership with the evidence of Ms R. She provides an affidavit for the husband affirmed 12 September 2020. She gave evidence and was cross-examined. She required an interpreter.
Ms R is a finance professional now resident in Country O. She claims to have met the husband socially in Melbourne when she was a student. There is no evidence that she has ever lived in Queensland. Essentially, she claimed that her mother purchased the Suburb K property for her as an investment. Notably, Ms R’s mother did not give evidence. Ms R says she was unable to obtain finance from the bank and enlisted the assistance of the husband. She does not provide corroborating evidence of bank refusals. There is no evidence of any historical connection between the husband and Ms R or Ms R’s family. Ms R’s affidavit claims that the husband holds title to the Suburb K property on trust for Ms R.
The husband and Ms R rely on a document titled “Agreement on Nominal Holding of Property” dated April 2017 (“the Agreement”). The Country O language and translated versions of those document are annexed to Ms R’s affidavit.
On the balance of probabilities I do not accept the evidence of Ms R that she is the beneficial owner of the Suburb K property. I find on the balance of probabilities that the husband owns the property consistent with title, mortgage, and his representations to the Australian Taxation Office.
The purported Agreement does not carry the signatures of all relevant persons. Any reading of the “Agreement” discloses Ms R’s mother to be, in fact, the purported and asserted beneficial owner of the property rather than Ms R herself as asserted by both the husband and Ms R. Again, Ms R’s mother did not give evidence.
When cross-examined, the evidence of both the husband and Ms R was vague, variable, and perhaps contradictory as to how they met, even accounting for each requiring interpreters in their evidence.
The husband being the only signatory to the purported “Agreement” claimed not to hold a copy of the document.
Finally, at [35(c)] of her affidavit,[16] the wife deposes:
[Ms R] deposes to the rental income of the Queensland property being deposited into her ANZ account ending […98]. However, [Ms R] transfers funds into [the husband’s] ANZ Access Advantage Account ending […78] which vary between $1,000 to $2,000 per month. [The husband] did not disclose statements for his ANZ Access Advantage Account ending […78] and I needed to incur the expense of issuing a subpoena to ANZ to obtain the statements.
[16] Filed 1 October 2024.
No explanation was given as to why Ms R’s mother did not provide an affidavit in support of the husband given that she is arguably the beneficial owner of the property on the face of the purported “Agreement” and, secondly, where Ms R claims that her mother provided the significant deposit for the purchase.
Consistent with the observations in “Elias”, there is prima facie evidence of the husband’s legal ownership of the Suburb K property. He has made representations and obtained financial advantage as the owner. He does not, in my view, give or adduce evidence to rebut that presumption. I did not find either the husband or Ms R to be credible witnesses in respect of this issue.
Secondly, the husband and his mother, Ms S, both assert that the husband holds a property in Region N, Country O on trust for his mother. The husband again holds the title in his name and has done so since 2011.
The husband’s mother, Ms S, affirmed an affidavit on 10 September 2024. She gave evidence and required an interpreter with my observations being that she had no command of the English language. In cross-examination Ms S conceded that her affidavit was prepared by her son and the that she did not have the contents of the document translated to her. The jurat to Ms S’s affidavit does not show the document being interpreted albeit witnessed by a consular official at the Australian Consulate in City T.
Ms S says that her son purchased the property on her behalf off the plan in 2011 and that the contract settled in 2013. She says that limitations then existed in Country O on ownership of more than one property and where she was at that time already the owner of another property and hence the property being purchased in her son’s name.
Ms S says she currently lives in the relevant property. She says she made all relevant payments towards the property.
The husband faces similar difficulties and presumptions as with the Suburb K property although in this case there is no evidence of representations made for financial advantage by him.
Where there is an evidentiary consideration of relative weight and evidence, there are issues with the evidence of the husband and his mother which weigh against the husband holding title for the property. Firstly, Ms S’s affidavit itself suffers due to her concessions as to the preparation of the document and the inadequacies of the jurat and where Ms S herself admits that her son prepared the document and that she had no communications with a solicitor.
I accept the evidence that Ms S resides in the property.
Neither the husband nor his mother provide corroborating evidence of his mother’s claim of limitations to property ownership in Country O at that particular time and noting that the husband’s father, Mr Z[17], in fact gives evidence as to his multiple holdings of real property. Again the fact of the husband’s name on title leads to an advantage gained for his mother by a false representation, an apparently illegal one. In such circumstances with available presumptions, the onus is on the husband to give and adduce evidence to rebut those presumptions.
[17] Filed 24 September 2024.
The husband and his mother rely to a degree on an “agreement” but which they both concede was prepared only after the husband’s separation from the wife in these proceedings and its probity must be considered accordingly. In that context it carries little or no evidentiary value.
On consideration, and on the balance of probabilities, where the husband holds legal title to the Region N property, I am not persuaded that he has given or adduced evidence of sufficient weight to show that he holds the property on trust for his mother.
The husband concedes that has sold two valuable watches since separation. The wife says, without valuation evidence, that they might be worth $25,000 each and that was perhaps the purchase price. The husband says that he has sold them for much less. He says $15,000 for both. Consistent with the state of the evidence in this matter, he provides no documentary or other evidence in support of the purported sales. There is no evidence, however, that he has utilised the proceeds (whatever they might be) for essential or reasonable living expenses. In all of the circumstances, I intend to “add-back” the sum of $15,000 to the pool on the husband’s side of the ledger and consistent with the authorities set out earlier in these Reasons.
The husband concedes that he sold Motor Vehicle 1. He says the sale price was $5,000. He now drives a motor vehicle provided by his company. Again, there is no evidence of reasonably necessary expenditure of the proceeds. I will add the sum of $5,000 back to the pool on the husband’s side of the ledger.
The wife says that the husband has retained furniture and contents at value of $25,000. No full inventory or valuation is provided. The husband disputes the wife’s assertion. In the circumstances I am unable to accept the assertion of the wife who carries the onus of proof.
The wife then claims further add-backs to the property pool on the husband’s side of the ledger with five particulars totalling $329,519.47. Prominently they involved the disposal of the husband’s 45 per cent interest in a company entity U Pty Ltd. There is no doubt that the husband did dispose of his 45 per cent interest. He says that the company was not functioning or was dormant. He says he received no payment for the transfer of his interest. The beneficiary of his interest did not give evidence. The wife produces a financial statement from the business suggesting that a 45 per cent interest in that entity would have a value of $92,000. Again, the evidence is vague and uncertain although I am satisfied that the husband has disposed of his interest. This is a matter more properly dealt with under s 75(2)(o) where it is not possible on the evidence for me to make findings of value with any certainty.
Similarly, the wife asserts further add-backs in respect of payments made by the husband to his mother; to a friend named Ms V; and to a company “W Company”. The husband gives explanations for these money transfers from accounts including “loan” payments to his mother. There is evidence of transfers from the husband to his mother of $1,800 per month for a period albeit not continuing. Again, his evidence is vague and uncertain. There is a lack of corroboration. In all of the circumstances I intend to deal with these matters under s 75(2)(o) of the Act.
The husband in his affidavit at [98] seeks “add-backs” to the wife’s side of the ledger in 13 particulars. They involved various movements of monies plus the use of the former matrimonial home by the wife without paying outgoings, and the sale by her of a motor vehicle. The total claimed by the husband is E$520,000. The wife gives some responses to these assertions and with some or some partial concessions by the husband, but where yet again the husband’s evidence goes no further than the bare assertion but with perhaps an invitation to the Court to assume the forensic accounting role. Again, I think it proper to deal with these matters under s 75(2)(o) in a more generalised fashion than the process of “add-backs” which in my view requires some mathematical and evidentiary precision.
Given my findings above together with substantial agreement between the parties, I am able to find the property pool at value to comprise of the following:
Property Value Net proceeds of sale of Suburb B and Suburb C properties held in trust $375,939.08 E Street, Melbourne (wife) $390,000.00 F Street, Suburb G (wife) $380,000.00 H Street, Melbourne (wife) $310,000.00 J Street, Suburb K, Queensland (husband) $385,000.00 L Street, City M, Region N, Country O (husband) $710,000.00 Part property settlement (wife) $80,000.00 Part property settlement (husband) $80,000.00 P Pty Ltd (motor vehicle) (husband) $59,000.00 Proceeds of sale of Motor Vehicle 1 (husband) $5,000.00 Proceeds of sale of watches (husband) $15,000.00 Total Property $2,789,939.08
The liabilities of the parties are as follows:
Liabilities Value ANZ mortgage - F Street, Suburb G (wife) $266,166 ANZ mortgage - H Street (wife) $228,773 ANZ mortgage - Suburb K (husband) $237,000 Total Liabilities $731,939
The net property of the parties is $2,058,000.
CONTRIBUTION
Any realistic understanding of the parties’ various contributions is best understood and identified in the current distribution of their assets. Significantly, on my findings, the husband has contributed the Suburb K property (equity $148,000) and the Region N, Country O property ($710,000), totalling $858,000 at current value. Valuations as at the date of commencement of the relationship are not provided. I generally accept the wife’s initial contributions being equity in the Suburb G property of some $295,000, equity in the H Street property of $96,000, a deposit on the E Street property ($42,150) and savings ($20,000) totalling $453,150 but with current equity totalling $585,061.
Although the husband denies beneficial ownership of the Suburb K and Region N properties, I have found otherwise. He should, however, be given credit for his contributions of those properties accordingly.
The issue of contributions then becomes clouded by the various assertions of the parties and met by denials. Each claim significant direct financial contributions from family members and also from various third parties none of whom were put on affidavit. Any basic addition of the claimed contributions by both of the parties, put together with their initial contributions, would far outweigh in total the value of the assets now in their hands. Put simply, the credit of each of the parties as to these financial injections is dubious. It is here that the forensic accounting exercise has been effectively delegated to the Court.[18] For example, the husband responds to the wife’s claims of financial injections into his business accounts by saying that such deposits included disbursements to be paid out for his clients. There is little or no documentary evidence to substantiate that response. Similarly, he at one stage claimed that monies in travelling through his bank accounts were effectively a form of property settlement between his separated parents but using his bank account as a financial intermediary. Parental injections of funds are prominent and now claimed often unconvincingly as “loans”. Prominently, both parties identify third parties from Country O as apparent benefactors but without those persons being placed on affidavit or with these persons joined or requesting joinder as parties. At times, payments are claimed to be loans. Conversely, payments made to parents are said to be repayments as opposed to the assertion of the other party of attempts to hide money from the scrutiny of the Courts. There are numerous bank accounts as for example the wife claiming the husband to hold no less than ten bank accounts in Country O.
[18] Horrigan & Horrigan [2020] FamCAFC 25 at [35].
Without the benefit of forensic accounting evidence, the best I can do is to identify significant injections of funds apparently by or on behalf of family and benefactors of each of the parties. Whilst there are some admissions made by each of the parties as to contributions and as to transfers of monies between them and made on their behalf, the greater majority of funds coming into their bank accounts and leaving those bank accounts is left without satisfactory explanation. Where I am not required to conduct a mathematical audit, put simply, I am unable to determine whether one or other of the parties made greater financial contributions during the course of the relationship than the other but repeat that the current value of the property pool appears to be far less than the total of the financial contributions claimed by these parties and hence the significance of those contributions must be seen within this context. I do know that both parties were employed or self-employed. I do know that each had family or third-party benefactors. I do know that the total injections of monies far outweighs the current value of the asset pool.
I accept that the wife contributed her time, effort and particular skills in the setting up of the husband’s migration business which is now his source of income. I accept her evidence on the basis of her own particular skills and experience together with her far superior English language skills making it highly likely that the husband benefited from these attributes of the wife when setting up his business in Australia. Unfortunately, the husband goes to some length to deny or discredit the wife’s contributions. Again, I find against the husband as to his credit in these denials.
Whilst the husband’s initial financial contributions may have been greater than those of the wife, it is well-established that this is not a mathematical exercise for the Court. The parties commenced cohabitation now some nine years ago in 2016. I accept the wife’s assertions of non-financial contributions towards the husband’s business. I have evidence of the value of the wife’s initial contributions but not those of the husband. I have some assistance from the current value of the assets now in the hands of each of the parties. Taking all matters into account and within the context of this complex financial relationship, I am of the view that there should be an adjustment to the husband of 7.5 per cent of the tangible property on account of contributions.
SECTION 75(2) FACTORS
There also are complexities and evidentiary deficiencies in the considerations for the Court as to whether there be a further adjustment to either of the parties under s 75(2) of the Act.
Firstly, as mentioned above, the wife’s claimed add-backs of some $329,000 together with the husband’s claimed add-backs of near $500,000 should be considered here. Against denials of each party, the financial tracing process for the Court is an impossible one. I do, however, take into account to the husband’s disposal of his 45 per cent interest in U Pty Ltd. He says, without any corroboration, or evidence as to value, that he received no payment for the sale of his interest. A financial statement of the entity produced by the wife, however, seems to allocate a value of 45 per cent of that business at $92,000 although I accept that this document itself without further explanation is of limited probity. I otherwise put the wife’s claims of money transferred by the husband into a similar category as to the husband’s claims of transfer of monies by the wife. It is simply impossible for me to make findings where there are bald assertions and bare denials or uncorroborated explanations of loans, gross payments subject to disbursement, or third-party involvements. The provision of thousands of pages of bank statements do not assist. I note, however, that each of the parties makes some limited admissions as to transfers of funds and I take all of these matters into account under s 75(2)(o). I am satisfied generally, but without satisfaction as to the particularity, that each party benefited financially from family or third-party benefactors.
The wife claims that her contributions were made more onerous by reason of the husband’s behaviour. She makes claims of family violence of various types including coercive and controlling behaviour of the husband. She is met with denials. The husband denies family violence. Although these issues were not the subject of thorough or intrusive cross‑examination, where I had the advantage of seeing and hearing both parties give evidence, I find the wife to be the more credible witness. It is often difficult to identify a nexus between some form of family violence and the making of contributions more arduous. However, given the evidence of the parties generally, I am able to infer the husband’s asserted behaviour in its coercive and controlling form to impact on the wife such that her contributions to the household are likely to have been made more onerous and notably where she now suffers diagnoses of depression and anxiety such that impact her ability to work to her potential.
Still further, the wife says that she should be given some consideration under s 75(2) of the Act by reason of her more limited working and earning capacity. The wife is in employment. She works three days a week and earns some $54,000 per annum. The husband’s income is more vague. Certainly, even on his own evidence, there are multiple transfers between entities and bank accounts of many thousands of dollars. The financial statements suggest gross receipts for his business of E$250,000. The wife asserts, and I accept, that the husband holds no less than 10 bank accounts in Country O. He travels two-monthly to Country O or other parts of the world for his business. He benefits from his business by use of a motor vehicle at the very least. He has re-partnered and has the benefit of living in accommodation provided by his partner with whom he has a young child. On my findings he has the income of the Suburb K property. On all of the available evidence and on the balance of probabilities, I find the husband has superior earnings to the wife.
The issue is, however, as to the wife’s earning capacity and as asserted by the husband, as to whether she could and should work full time in her occupation. The wife relies on an affidavit from her psychologist, Ms Y. She provided an affidavit sworn 25 September 2024 annexing a comprehensive psychological assessment on the mother.
I found Ms Y to be an open, objective and professional witness. That is, I did not see her as being an advocate for her client. For instance, Ms Y candidly volunteered that she effectively left to her client the issue of whether or not she would be able to work full time.
Ms Y’s report does, however, disclose issues of coercive and controlling family violence perpetrated on the wife by the husband and hence gives some corroboration of the wife’s own evidence. She reports the wife having attempted self-harm on more than one occasion. She reports anxiety and depressive conditions.
Ms Y’s psychological testing confirmed elevated depression and high levels of anxiety in the wife together with indicators of mental health disorders. At page 9 of her Report Ms Y states:
It is likely that [the wife] will continue to find difficulty in many aspects of her life. Currently, it seems it would be too difficult for [the wife] to return to fulltime employment in the current state of mind. Even though she has the knowledge and skills to complete tasks in her current role, it is a question of resilience or dependability when it comes to being sufficiently rested to reduce fatigue and to focus on her daily work responsibilities. She currently reports as exhausted after the three day working week. At times she has struggled with attendance at work and expresses her gratitude to a workplace wherein flexible hours are tolerated. The protracted divorce proceedings are also not helping her distressed emotional state.
On the force of the evidence, and on the balance of probabilities, I am satisfied that the husband has superior income and income potential to that of the wife. In all of those circumstances I find it just and equitable to make an adjustment on account of s 75(2) factors to the wife of 5 per cent.
CONCLUSION
Consequently, I find that the property of the parties should be divided as to 52.5 per cent to the husband and 47.5 per cent to the wife after consideration of both contribution and s 75(2) factors.
The net property pool sits at value of $2,058,000. The husband has in his possession the following:
Item Value Suburb K property (equity) $148,000 L Street, City M, Region N, Country O $710,000 P Pty Ltd (motor vehicle) $59,000 Part property settlement $80,000 Proceeds of sale of watches $15,000 Proceeds of sale of Motor Vehicle 1 $5,000 Total $1,017,000
Should the husband achieve 52.5 per cent of the property pool he would be entitled to value of $1,080,450 and hence would receive $63,450 cash from the monies held in trust. Nevertheless, the wife’s proposal put in final submissions by her counsel is that the monies on trust be divided equally between the parties in the sum of $187,969.54 to each. The husband would then receive $1,204,969.56 which I calculate to be 58.55 per cent of the property pool. Whilst my findings and determinations are based on justice and equity and where I am not bound by choice between the proposals of the parties, in this matter I accept the proposal of the wife as consistently put and argued by her since prior to the commencement of the trial. As such I will order that each party receive on half of the monies held in trust and that each otherwise retain those assets currently held by each as evidenced in these Reasons.
I certify that the preceding one hundred and two (102) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice McGuire. Associate:
Dated: 6 February 2025
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