Dakic and Dakic
[2008] FamCA 432
•6 June 2008
FAMILY COURT OF AUSTRALIA
| DAKIC & DAKIC | [2008] FamCA 432 |
| FAMILY LAW – PROPERTY |
| Family Law Act 1975 (Cth) s 79 |
| Omacin & Omacini (2005) FLC 93-218 Chorn & Hopkins (2004) FLC 93-204 Kowaliw & Kowaliw (1981) FLC 91-092 Crampton & Crampton (2006) FLC 93-269 Keenahan & Keenahan (2004) Fam CA 360 Eltham & Eltham (2007) Fam CA 657 F & M (2006) Fam CA 202 Mallet v Mallet (1984) FLC 91-507 Kennon (1997) FLC 92-757 Cuneo & Cuneo [2006] Fam CA 158 AB & ZB (2003) FLC 93-140 Rickaby (1995) FLC 92-642 Aleksovski v Aleksovski (1996) FLC 92-705 Gosper & Gosper (1987) FLC 91-818 |
| APPLICANT: | Mr Dakic |
| RESPONDENT: | Mrs Dakic |
| FILE NUMBER: | SYF | 44 | of | 2006 |
| DATE DELIVERED: | 6 June 2008 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Watts J |
| HEARING DATE: | 16 - 18.7.2007 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Moss |
| SOLICITOR FOR THE APPLICANT: | Malouf Solicitors |
| COUNSEL FOR THE RESPONDENT: | Mr Richards |
| SOLICITOR FOR THE RESPONDENT: | Williamson Isabella |
Orders
Pursuant to Section 79 of the Family Law Act 1975 (“the Act”) an order be made in the terms of paragraphs 2 – 9.
The husband pay to the wife within 56 days the sum of $130,340.00.
Simultaneously with the husband’s compliance with paragraph 2 hereof, the wife transfer all her right, title and interest in the former matrimonial home situated at B in the State of New South Wales (“the former matrimonial home”) being the whole of the land contained in Certificate of Title Folio Identifier … to the husband.
Simultaneously with the wife’s compliance with paragraph 3, hereof the husband and wife shall do all things, acts and deeds and sign all documents necessary to enable the husband to discharge the mortgage to the Commonwealth Bank of Australia now secured over the Title of the former matrimonial home and the husband shall discharge the mortgage.
Forthwith upon the compliance by the husband with paragraphs 2 and 4 hereof, the wife vacate the former matrimonial home and the husband have occupation of that home to the exclusion of the wife thereafter.
If the husband fails or neglects to comply with paragraphs 2 and 4 hereof in the time specified, then each party shall take the necessary steps and execute the necessary documents to sell the former matrimonial home at the earliest possible date at a price to be agreed upon between the parties and failing such agreement to be determined by the President of the Real Estate Institute of New South Wales for the time being or his nominee and that the proceeds of the said sale be disbursed as follows:-
6.1.payment of the amount outstanding under the mortgage to the Commonwealth Bank;
6.2.payment of agent’s commission and advertising expenses and legal expenses of sale;
6.3.payment to the wife of 79% of the balance;
6.4.payment to the husband of 21% of the balance.
Subject to retention by the husband of items of furniture and personal effects used by the child N, the balance of furniture and personal effects (“the remaining items”) be divided between the parties as agreed or, failing agreement, on a ‘two lists’ basis wherein the husband prepares two lists of equal value of the remaining items, the wife choses one such list and retains the items as set forth therein and the husband retains such other items as set forth in the list then left in his possession.
Each party be solely entitled to the exclusion of the other of all property including but not limited by furniture, personal effects, motor vehicles, superannuation, long service leave and other emoluments in the name or possession of such party as at the date of these orders.
That the husband indemnify the wife in relation to any capital gains tax liability arising from the sale of shares.
That if either party refuses or neglects to sign (within fourteen (14) days of a written request to do so) any documents necessary to effect the terms of these Orders, the Registrar of the Sydney Registry of the Family Court of Australia is hereby appointed pursuant to the provisions of Section 106A of the Act to execute such documents on behalf of such party.
IT IS NOTED that publication of this judgment under the pseudonym Dakic & Dakic is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYF 44 of 2006
| Mr Dakic |
Applicant
And
| Mrs Dakic |
Respondent
REASONS FOR JUDGMENT
INTRODUCTION
This case is about what alteration should be made in respect of the property of the parties.
The case has two unusual features:
2.1.Significant non-financial contributions by the husband’s mother;
2.2.The effect the wife’s mental illness had upon her contributions.
APPLICATIONS
Wife
The wife filed an Application for Final Orders on 10 February 2006.
In her case outline the wife seeks the following orders:
1.The Husband pay to the Wife within one (1) month the sum of two hundred and fifty thousand dollars ($250,000).
2.If the Husband fails or neglects to comply with order 1 hereof in the time specified then he each party shall take all necessary steps and execute all necessary documents to sell the property situated and known as [B Property] being the whole of the land comprised in Certificate of title folio identifier […] by public auction at the earliest possible date at a reserve price to be agreed upon between the parties and failing such agreement to be determined by the President of the Real Estate Institute of New South Wales or his nominee and that the proceeds of the said sale be disbursed as follows:
i.Payment of the amount outstanding under the mortgage to the Commonwealth Bank
ii.Payment of agent’s commission and advertising expenses and legal expenses of sale
iii.The amount payable to the Wife pursuant to order 1 hereof
iv.Balance to the Husband.
In final submissions the wife did not quantify the amount that she wished to receive but sought a payment of money by the husband to her which would give her 60 percent of the overall net assets.
Husband
The husband filed a Response to Application for Final Orders on 13 March 2006. In his case outline he sought orders in the following terms:-
Parenting arrangements:
1.That the child of the marriage, namely [N] born […] April 1990, reside with the husband.
2.That the wife have contact with the said child as agreed between the parties from time to time.
Property Settlement
3.That within a period of two months of the date of these orders, the wife transfer all of her right, title and interest in the former matrimonial home property situate at [B] in the State of New South Wales (“the former matrimonial home property”), being the whole of the land contained in Certificate of Title Folio Identifier […], to the husband.
4.That simultaneously with the wife’s compliance with order 3 hereof, the husband and the wife shall do all such things, acts, deeds and sign all documents necessary to enable the husband to discharge the mortgage to Commonwealth Bank of Australia now secured over the title of the former matrimonial home property.
5.That simultaneously with the parties’ compliance with orders 3 and 4 hereof, the husband shall do all such things, acts, deeds and sign all documents necessary to pay to the wife, or as otherwise directed by her in writing, the sum of TWENTY FIVE THOUSAND DOLLARS ($25,000).
6.That forthwith upon compliance by the parties with orders 3, 4 and 5 hereof the wife vacate the former matrimonial home property and that the husband have occupation of that property to the exclusion of the wife thereafter.
7.That pending compliance with orders 3, 4 and 5 hereof the parties pay all outgoings for the former matrimonial home including, but not limited by, mortgage payments, council and water rates, electricity, telephone, insurance premiums and the like, in equal shares.
8.That subject to retention by the husband of items of furniture and personal effects used by the child [N] and the husband’s mother, […], for their benefit that the balance of furniture and personal effects (“the remaining items”) be divided between the parties as agreed or, failing agreement, on a “two lists” basis wherein the husband prepares two lists of equal value of the remaining items, the wife to choose one such list and retain the items as setforth thereon and the husband to retain such other items as setforth on the list then left in his possession.
9.Each party be solely entitled to the exclusion of the other to all property including but not limited by furniture, personal effects, motor vehicles, superannuation and long service and other employment type emoluments (and also including choses in action) in the possession of such party as at this date; and
10.That in the event that the orders herein contained direct either the husband or the wife or both of them to execute a deed or instrument and that person has refused or neglected to comply with that direction, the Registrar be appointed pursuant to s.106A of the Act to execute any such document in the name of the party in default of executing such document or in the name of the person to whom the direction was given and to do all acts and things necessary to give validity and operation to the deed or instrument and the costs thrown away by reason of such default shall be paid by the party whose default has occasioned such default on an indemnity basis.
11.That the wife pay the husband’s costs of and incidental to these proceedings.
In the written outline of argument provided by Counsel for the husband, the husband proposed that he pay to the wife the sum of $33,000 (at page 13). That is consistent with his position that there should be a 70/30 division of the overall net assets of the parties in his favour.
CHRONOLOGY
The husband was born in June 1958 and is now aged 49 years.
The wife was born in April 1964 and is now aged 44 years.
On 19 July 1989 the parties commenced cohabitation at the husband’s parent’s home in Macedonia. The parties married in Macedonia in September 1989.
In December 1989 the parties came to Australia. At that time they lived with the wife’s parents for three weeks and then rented a property for six months.
In April 1990 the child of the marriage, N, was born. He was 17 years of age at the date of hearing, is now 18 years of age and will remain living with his father. The parties were living separated under the one roof in the matrimonial home from August 2005 up until very shortly before the final hearing.
The husband was in paid employment throughout most of the marriage.
The parties give differing versions of the wife’s employment after N’s birth. The wife asserts that she worked for AA Company as a receptionist/secretary in 1991 for about 12 months. The husband claims that she started at AA Company in late September 1991 and only worked there for four to six weeks. The husband says that the wife then found new employment at S Company. The wife gives no evidence in her primary affidavit about working at S Company. The wife’s evidence in Exhibit C is that she worked for AA Company for six months before her mother-in-law arrived from Macedonia and for six months after. Therefore, according to the wife, her commencement date of working for AA Company is in the middle of 1991. In Exhibit C the wife says that she can’t recall the employment with S Company. Given that there is no other objective evidence and having regard to what I say below about the credit of both the parties, I am unable to resolve the discrepancy in the versions given by each party as to the wife’s employment history immediately following the child’s birth.
On 5 January 1992 the husband’s mother travelled to Australia on a six month tourist visa. She stayed with the parties.
In June 1992 the husband’s mother’s visa expired but she stayed in Australia and an extension of the visa was ultimately granted.
On 7 September 1992 the wife commenced employment with P Company in Sydney.
In January 1994 the child commenced pre-school.
In March 1994 the wife’s schizophrenia was diagnosed.
In 1995 the husband purchased in his sole name a property at C (“the [C] property”). The purchase price was $105,000 plus expenses. The husband borrowed $88,000 by way of mortgage from the Commonwealth Bank. Improvements were carried out to the property of $20,000 - $30,000. The parties lived in the property from 8 March 1995 to 20 July 2004 when they moved to the current matrimonial home at B.
In 1995 the wife’s employment with P Company was terminated and as a result she received about $90,000.
In February 1996 the husband purchased a two bedroom investment unit at L (“the [L] unit”).
On 3 September 1996 the husband commenced work with D Company.
In 1997 the husband’s mother was granted Australian citizenship.
On 5 June 1997 the husband’s mother commenced receiving a carer’s pension originally in the sum of $353.20 per fortnight. She received a total amount of $80,752.15 from 1 July 1997 to 30 June 2005.
In July 1998 the husband purchased a property at G (“the [G] unit”).
The wife asserts that in January 1999 she commenced work at a Rehabilitation Centre and worked there until July 1999. The husband says that the wife found work from September 1999 to early December 1999 as a volunteer for the R Agency which he believed was a rehabilitation agency. I can find nothing in the objective evidence that would allow me to determine which version is correct.
The wife claims that in November 1999 she commenced work at R Angency as a part time temporary receptionist.
On 8 January 2001 the wife commenced full time employment as an administrator at S Health Service.
In 2003 the parties jointly purchased a property at B (“the former matrimonial home”) which was a land and house package for $540,000. The parties jointly borrowed $515,000 from the Commonwealth Bank.
On 21 July 2004 the parties and the child moved into the former matrimonial home.
The wife says that in June 2005 her employment with S Health Service was terminated. The husband says that the date of termination was 17 July 2005. I am unable on the objective evidence to say which version is correct.
In July 2005 the husband’s mother was diagnosed as suffering from breast cancer.
By August 2005 the parties separated under the one roof.
On 7 June 2006 the C property was sold.
In July 2006 the husband, the child and the husband’s mother left Australia for Macedonia.
On 25 September 2006 the husband and the child return to Australia.
In September 2006 the husband’s mother passed away in Macedonia.
On 1 August 2006 contracts were exchanged for the sale of the L unit and the sale was settled on 15 September 2006.
CREDIT
Wife
Parts of the wife’s oral evidence indicated she was not a good historian.
On a number of occasions the husband’s version of events were put to the wife in the witness box and she simply indicated that she could not remember.
There were also times during the wife’s oral evidence when she said that her written evidence was not accurate.
I formed the view that whilst the wife was doing the best she could in the witness box she appeared to be affected by the stress of the situation which in turn affected her ability to be responsive to a significant number of questions. I formed the view that this was symptomatic of her mental illness.
Counsel for the husband sought in certain circumstances to rely on the wife’s evidence to prove something that was in the husband’s favour, even though there may not have otherwise been objective evidence in that regard.
Except where there is evidence in respect of which there is agreement or where there is otherwise objective evidence, I need to be careful when relying upon evidence given by the wife.
Husband
Counsel for the wife submitted that the husband prevaricated and gave conflicting evidence. In addition, Counsel for the wife suggested that I should treat all the husband’s evidence with great caution. I accept there is substance in that submission.
As an example, Counsel said the husband could not explain why he had said that it was his brother who sent him the $10,000 in October 1991.
There is a major discrepancy in the evidence between the husband and the husband’s brother in relation to payments made by the brother to the husband since 2001 (discussed in greater detail below).
The husband asserted that making adverse findings against him arising from inconsistencies between his evidence and his brother’s evidence was unfair because his brother was taken from work in a rush to give his oral evidence by electronic means and that his brother could not concentrate. He expressed the view that his brother had been “taken in an ambush”. When it was put to the husband that the evidence about the brother sending to the husband $10,000 in October 1991 was not even in his brother’s written document, the husband’s explanation was that maybe his brother had forgotten he had sent the $10,000. I find that possibility slightly incredulous given that the husband’s brother remembered and gave specific detail about sending far smaller amounts (for example $3,000 in September 1990 and $2,472 in August 1992).
There are a number of occasions where conversation that had been quoted in the husband’s affidavits as actual words said were repudiated by the husband upon him actually reviewing the document in the witness box.
In final submissions, Counsel for the husband suggested that discrepancies in the husband’s evidence and the husband’s brother’s evidence in relation to funds moved between the two of them and references to “gifts” should be seen in an overall cultural context. The implication is that I should not rely on evidence of any specific conversation but look at documented transfers of money. I cannot accept that submission given the precision with which the husband originally presented his case.
Other problems with that submission are that I do not accept the husband did not understand what “gift” meant and although deposits appear in accounts, there is no verification by objective documentation as to the source of the funds for those deposits.
I found implausible the husband’s explanation as to how he had come to photocopy the wife’s bank book (page 43, annexure E1 of the husband’s affidavit of 30 November 2006). He claimed that he had seen the wife’s bank book in some rubbish she was throwing out; he had taken it from the rubbish; had it photocopied and had put it back in the rubbish.
I also had considerable difficulty in accepting the husband’s evidence about him receiving money from his mother after separation for the payment of his solicitor’s legal fees. He claimed that his mother gave him at least $5,000 - $6,000 or “maybe more” for the payment of legal fees. The parties separated in August 2005. The mother became seriously ill in 2006. There is no evidence that any money came from Macedonia during this period. The only source of funds from the mother would have been her pension (from which expenses for the mother would need to be deducted). The husband has not given any convincing evidence as to how the mother would have had the amount that he claims she gave him for the payment of legal fees.
Overall, I accept the submission by Counsel for the wife that I should be cautious about placing great reliance upon evidence from the husband and particularly so in relation to financial arrangements with his brother and with his mother.
Husband’s brother
I have difficulty accepting the evidence by the husband’s brother that he made no payment to assist his mother between 1993 and when she returned to Macedonia permanently (apart from sending her part of her Macedonian pension). This was at a time when his evidence is that he was making payments to his brother when his brother did not actually have a specific need for the payment. Given the husband’s control of family finances, I also have difficulty accepting both the brother and the husband’s evidence that the brother was making part pension payments to the husband’s mother in Australia without the husband knowing about those payments. As set out below, I have difficulty in accepting evidence from the husband and the husband’s brother about payments after 2001.
Conclusions on credit
In summary, I have difficulty accepting the credit of either party. Overall, if there is a discrepancy in the evidence in the wife’s case as compared with the husband’s case I will attempt to resolve that discrepancy, if possible, by reference to objective material or by picking the version which is more inherently credible.
THE APPROACH TAKEN IN THESE REASONS FOR JUDGMENT
In this matter my task is to:
58.1.Identify and value the property, assets, financial resources and liabilities of the parties;
58.2.Identify relevant contributions and assess them;
58.3.Consider relevant matters referred to in s.79(4)(d) – (g) of the Family Law Act (“FLA”);
58.4.Ensure the order adjusting the property assets and liabilities of the parties is just and equitable.
PROPERTY ASSETS, FINANCIAL RESOURCES AND LIABILITIES OF THE PARTIES
There has been substantial agreement in relation to the values to be attributed to those assets and liabilities contained in the pool of assets, which are set out in the table below. “Determined” in the agreed/determined column in that table indicates items for which no value has been agreed. A determination has been made in relation to three contentious items for the reasons set out after the table.
The parties in this case agreed by consent to treat superannuation in the one pool of assets.
Assets Item no. Title Description H value W value Agreed/ Determined Value 1 J The former matrimonial home $420,000 $420,000 Agreed $420,000 2 W Monies received by the wife as partial property settlement $55,000 $55,000 Agreed $55,000 3 H Monies received by the husband as partial property settlement $55,000 $55,000 Agreed $55,000 4 H Husband's superannuation benefits $56,199 $56,199 Agreed $56,199 5 H Husband's 1989 Magna Executive $2,550 $2,550 Agreed $2,550 6 H PB Ltd Shares (2,777 @ $3.59) $9,969 $9,969 Agreed $9,969 7 H IAG Shares (57 @ $5.72) $326 $326 Agreed $326 8 W Wife's First State Super $16,169 $16,169 Agreed $16,169 9 J Furniture and contents $5,000 $5,000 Agreed $5,000 10 H Add back husband's legal costs sourced from monies returned to him by Commonwealth Bank on 5.2.07 $25,000 $37,623 Determined $25,000 11 H Share acquisition plan $0 $5,981 Determined $5,981 12 H loan owned by husband's brother $0 $15,000 Determined $0 Total assets $651,194 Liabilities Item no. Title Description H value W value Agreed/ Determined Value 13 J Amount required to discharge mortgage over former matrimonial home $254,517 $254,517 Agreed $254,517 14 H CGT $25,752 $25,752 Agreed $25,752 Total liabilities $280,269 Total net assets $370,925
Item 10 – add back of husband’s legal fees
There is argument as to how much of the husband’s legal fees should be added back. The husband asserts it should be $25,000. The wife says it should be $37,623.
In Exhibit 1 the husband’s lawyer indicates that the husband has paid legal fees to date in the sum of $80,655.31.
He says that the source of funds for that payment are:-
“$40,000 from the proceeds of sale of [C] property pursuant to orders of the court 26 June 2006
$25,000 from proceeds of sale of [G] property
$15,655.31 from bank accounts part of which came from husband’s mother.”
On 26 June 2006 orders were made for an interim property settlement. Under Order 1(a) the husband was to receive $40,000 from the sale of the C property, the wife was to receive $55,000.
Under Order 2 the husband was to receive $15,000 from the sale of public company shares.
The parties received these monies and the fact that they have is reflected in items 2 and 3 in the balance sheet.
During submissions I was provided with an aide memoir by Counsel for the wife. Counsel for the husband said that the figures on that document were agreed. The aide memoir sets out deposits into the husband’s account from the sale of shares and payment of legal fees during the period March 2006 to June 2006.
The document reads as follows:-
“Legal fees
21 March 2006 $4,500.00
30 March 2006 3,623.67
31 May 2006 4,500.00
$12,623.67
Plus paid recently 25,000.00Share sales
17.3.2006 $7,087.10
23.3.2006 8,025.05
27.4.2006 11,185.22
25.5.2006 9,670.25
29.6.2006 30,786.70$66,754.32
Counsel for the wife claims that the amount of $12,623 should be added to the amount conceded by the husband of $25,000 in relation to legal fees ($12,623 + $25,000 = $37,623). Counsel submits that this is because that additional amount of $12,623 on his submissions clearly came from the sale of shares that were additional to the $15,000 that the husband would take under the orders of 26 June 2006.
Counsel for the wife therefore submits that the payments made in March and May 2006 are clearly referrable to capital received by the husband from the sale of shares and therefore in so far as those legal fees have been paid from capital from the sale of shares they should be added back.
Counsel for the husband’s response to that is that if one looks at annexure E to the husband’s affidavit the husband claims that since the parties separated under the one roof about two years ago in August 2005, the husband has expended a total of $145,792 on insurance, council rates, electricity, gas, internet, telephone, water, credit card purchases, food, tax, pest control and payment of accountancy fees. Of that figure of $145,792, $46,713 has been used for mortgage repayments. The overall figure also includes an amount of $19,200 that the husband spent on his trip with the child to Macedonia in July to September 2006, shortly before his mother died in Macedonia.
Counsel for the husband’s argument is that the account from which the legal fees were paid was the husband’s ordinary account into which he was paid wages and out of which he paid for expenditures. He argues that it is not realistic to attribute the payment of legal fees to capital received by him from liquidation of assets where there has been such an intermingling of funds.
The leading authority on the adding back of legal fees is Chorn & Hopkins (2004) FLC 93-204 where the Full Court said the following:-
56.In summary, we consider that the above mentioned decisions of the Full Court establish that, while the treatment of funds used to pay legal costs remains ultimately a matter for the discretion of the trial Judge, in determining how to exercise that discretion, regard should be had to the source of the funds.
57.If the funds used existed at separation, and are such that both parties can be seen as having an interest in them (on account, for example, of contributions), then such funds should be added back as a notional asset of the party, who has had the benefit of them.
58.If funds used to pay legal fees have been generated by a party post-separation from his or her own endeavours or received in his or her own right (for example, by way of gift or inheritance), they would generally not be added back as a notional asset; nor would any borrowing undertaken by a party post- separation to pay legal fees be taken into account as a liability in the calculation of the net property of the parties. Funds generated from assets or businesses to which the other party had made a significant contribution or has an actual legal entitlement may need to be looked at differently from other post-separation income or acquisitions.
The other recent authority about adding back legal fees is the Full Court decision in Omacini (2005) FLC 93-218. Subsequent Full Courts have referred to the following passage from Omacini with approval:-
30.To date, three clear categories of cases have emerged where the Court has determined that it is appropriate to notionally add back to the pool of assets, that is, assets that no longer exist. They are:
(a) Where the parties have expended money on legal fees. In DJM and JLM (1998) FLC ¶ 92-816 the Full Court said at 85,262:
``11.6 For reasons set out in Farnell, s 117 provides that each party to proceedings under the Family Law Act shall bear their own costs unless the Court otherwise orders. Failing to add back monies expended by parties on costs frequently has the effect of defeating the policy of s 117 by permitting the pool of available assets for distribution between the parties to be diminished by any monies that either of the parties have managed to spend on their costs up to the date of trial. We are of the view that the normal approach ought be to add costs already paid back into the pool. Whilst there may be cases where that approach is inappropriate, the reasons why it is not taken ought normally be spelt out.''
As a trial judge, it is sometimes difficult to reconcile these statements made by the Full Court in Chorn & Hopkins and Omacini. The first authority opines that legal fees paid from post separation endeavours should not normally be added back. The second opines legal fees would normally be added back.
Chorn & Hopkins tells me to have regard to the source of the funds prior to adding legal fees back. Because of the intermingling of funds in this case it is not clear where the $80,655.31 has come from. Omacini would tell me that legal fees should be totally added back unless this is a case where that approach is inappropriate.
In this case there is a way to solve the dilemma. I think the proper way of looking at this issue in this case is to recognise that the husband received a partial property settlement of $55,000 (that has already been added back against the husband in item 3) and treat this as the source of which funds from legal fees have been paid. Adding back $25,000 in legal fees against the husband as he suggests adds to the amount of $80,000 which is the amount he in fact has paid to his lawyers. Accordingly, I find it is appropriate to chose the figure asserted by the husband rather than the figure asserted by the wife in relation to item 10.
Item 11 – share acquisition plan
In paragraph 11 of his affidavit sworn 13 July 2007 the husband states that he had purchased some shares in PB Ltd and had also been granted some shares by his employer. The husband said he did not know the value of the shares. It was his understanding was he could not sell the shares until 2011. Currently he contributes $120 per week in relation to those shares and tax is deferred on any income earned on them.
The husband commenced the current level of payment as from 1 July 2006 and says he thus far has contributed $6,480 towards the acquisition scheme.
Annexed to the husband’s affidavit and marked F is a statement from P Limited dated 30 April 2007. It indicates that the market equivalent of the shares as at 17 April 2007 is in the sum of $5,961.87.
Counsel for the husband submits that this item should be brought into the balance sheet as a nil item, notwithstanding that Counsel for the husband accepts that the shares do have some value. Counsel for the wife submits that they should be brought onto the balance sheet at the figure referred to in annexure F (ie $5,961.87), notwithstanding the husband has actually paid more than that amount to be a participant in this scheme.
It was suggested during discussions that some discount should be made to the figure of $5,961.87 on the basis that these funds were not immediately available to the husband. The husband led no evidence as to what discount might be made to the current value of the shares on the basis that he will not receive the benefit from the scheme for some time. Absent any expert evidence as to the need to discount this figure, I believe it would be unsafe to do so. It was alternatively suggested that the fact that the husband could not immediately access these funds should be taken into account in a general way at the third step, but I do not accept this as an appropriate approach.
I find that the husband believed it was worthwhile to payout $6,480 for this interest to date and in those circumstances. I accept Counsel for the wife’s argument that the figure of $5,961.87 (the current market equivalent of the shares) should be added onto the balance sheet.
Item 12 – loan owed by husband’s brother ($15,000)
This claim arises out of evidence of a discussion between the husband, his brother, his sister and his mother after the death of the husband’s father in 2001.
Counsel for the husband said it was unfair to the husband for there to be a suggestion during final submissions that this amount should be added to the balance sheet. However, I find that given that this evidence was only explored with the husband in cross examination then the submissions by Counsel for the wife should not be dismissed out of hand.
The husband’s brother, K, at paragraph 12 of his affidavit says:-
“12. I recall that after my late father died, I had discussions with my mother and brother [the husband] and my sister […] whereby it was agreed that I would acquire our family home in [Macedonian]. I recall saying to my late mother ‘I will pay you $15,000 (AUD) for your interest in the property’ and I also recall saying to [the husband] ‘I will pay you $15,000 (AUD) for your interest in the property’. I could not pay the whole of these amounts in one payment after we had come to that agreement.”
In his affidavit the husband’s brother details monies given to his brother between 1990 and 1995. There is no mention in his written evidence about a payment after that time to the husband.
The husband’s brother’s oral evidence in relation to his topic was entirely unsatisfactory. That evidence included the following exchanges:-
Mr Moss
After your father died in 2001 did he give you – did you give him [the husband] $15,000?
Interpreter
Yes, I was giving it to him. Why not?
Mr Moss
After 2001?
Interpreter
After 2001 maybe I have given smaller amounts.
Mr Moss
When you say smaller amounts, how much?
Interpreter
After 2001, no, I think no I haven’t been.
Mr Moss
You didn’t send him any money?
Interpreter
I don’t know. I don’t know, I have to say I don’t know that I have given. I don’t remember. I cannot really confirm it or you know prove it.
Mr Moss
You certainly didn’t send your mother $15,000 after your father died in 2001?
Interpreter
I didn’t understand that. What was it?
His Honour
He asked did he pay his mother $15,000 after his father died in 2001?
Interpreter
To tell you the truth I don’t remember. I believe [A] did deliver 5000. I think we gave [A] $5000 for [the husband] and $5000 for my mother.
His Honour
That was in 1992?
Interpreter
I don’t remember to tell you the truth. I know my mother is also paid off.
Mr Moss
When did he pay his mother $15,000 – if there was an agreement in 2001 to pay his mother $15,000, when was that paid by?
Interpreter
I don’t know to tell you the truth. I can’t remember.”
Hence the husband’s brother’s evidence is that after 2001 he doesn’t remember sending $15,000 to the husband and he doesn’t remember sending $15,000 to his mother, pursuant to the alleged agreement after his father’s death.
The husband’s sister in her affidavit at paragraph 3 – 5 said this:-
3. After my late father died I recall discussions in person with my brother [K] and by telephone with my brother [the husband] and my mother concerning our family home at [Macedonia]. I recall we came to an agreement that the value of the property was $45,000 (AUD) and that my brother, [K], would purchase the shares of my mother and brother, [the husband], for $15,000 (AUD) each and he would pay to them that amount.
4.We divided the estate into three parts.
5.I am married and in my own residence with my husband and my family and I did not ask for a share of my father’s estate which comprised our family home.
The husband’s late mother’s affidavit sworn does not mention this conversation (notwithstanding the fact that the husband’s brother and sister say that she was a party to it). The husband in his lengthy affidavit material does not mention it.
The husband in oral evidence was cross examined about the arrangement.
The husband’s sworn evidence was that he has in fact received payments from his brother pursuant to the arrangement. The following is the evidence given by the husband regarding the arrangement:-
His Honour
Can you just tell me after your father died, there was a bit of a family discussion about what was to happen to the family home, is that right?
Husband
Yes
His Honour
And
Husband
Things were discussed even before when he has been alive
His Honour
Well I am concentrating on a discussion that your brother said happened afterwards
Husband
Yes
His Honour
Do you remember that discussion?
Husband
Yes
His Honour
And do you recall what was said during that discussion?
Husband
He would like to live in my father’s house
His Honour
Yes
Husband
So, we, he and my sister find approximate valuation of the house
His Honour
Yes
Husband
And decided to split $45,000 been decided to award that house and he have to buy us $15,000 to me and $15,000 to my mother
His Honour
And that was after your father died, that discussion?
Husband
Yes
His Honour
Now, what monies have you received from your brother in relation to that $15,000 that he owed you?
Husband
I received most of them.
His Honour
Well, are you able to tell me specifically what amounts you have received?
Husband
Well, is $15,000 I can say to you.
His Honour
Well
Husband
Because my mother when she go there she get for herself
His Honour
Well when did you get the $15,000, did it come in one lot, one amount
Husband
No, no
His Honour
Your father died in 2001 is that right?
Husband
Yes. And my mother go there in 2002
His Honour
Your mother went back home in 2002?
Husband
She’s been
His Honour
That’s when she went back?
Husband
Yes, with my son
His Honour
But what I am asking you is when did you get monies from your brother after 2001?
Husband
He send some money by some people when they come, I don’t remember which person been on holiday and they send some money with him. After my mother went she bring some money.
His Honour
Well, is that the best of your memory? We are talking about 2001 and onwards
Husband
Yes, I can’t give you the exact dates,
His Honour
Well how do you know the whole $15,000 was paid?
Husband
I know how much I receive
His Honour
Well tell me, how much did you receive and at what times?
Husband
Firstly after the discussion he send me about $5,000 or something.
His Honour
How did that come to you?
Husband
Its coming by the person who been visit here.
His Honour
The person’s name?
Husband
He not here. I don’t remember exactly which one. A few people they come and I don’t remember
His Honour
Alright, so $5,000 by a person; you can’t tell me their name?
Husband
Yes, ....inaudible....
His Honour
What was the next occasion?
Husband
A few people they come and I can’t, because few people and I don’t remember
His Honour
So people just turn up with envelopes for you?
Husband
Yes
His Honour
For you from your brother?
Husband
Yes, yes.
His Honour
What was the next amount?
Husband
When my mother go there she bring $5,000 for herself, bring $8,000 for myself and
His Honour
So you say your mother brought $5,000 back when she went there in 2002?
Husband
Yes I think so, yes. She told me that.
His Honour
Well she would have given you your money wouldn’t she?
Husband
Well, she kept some money for herself.
His Honour
But she had $5,000 herself?
Husband
Well, what you mean?
His Honour
Was she given money by your brother or was the $5,000 just for you?
Husband
No, but she kept part of that money for herself, you know, $15,000 for myself and $15,000 for herself, so
His Honour
Are you saying your mother brought $15,000 back for herself and $15,000 for you when she came back?
Husband
No, your mixing
His Honour
Well, I am trying to understand what you are telling me, I am not mixing anything
Husband
She bring $5,000 for herself and $8,000 for myself
His Honour
How much?
Husband
$8,000
His Honour
So in 2002 she brought $8,000 back?
Husband
Yes
His Honour
For you?
Husband
Yes
His Honour
And gave it to you?
Husband
Yes
His Honour
Now that would have left still an amount of $2,000?
Husband
Maybe
His Honour
Did you get paid that or is it still owed?
Husband
When I’ve been there I stay without any payment so doesn’t pay much for my stay with my son and my mother, so I don’t think this has to be paid to me
His Honour
Now, when you were talking to me about gifts before, were you trying to say that you believed you owed your brother back the monies he paid to you in the 1990s?
Husband
I think so, I have
His Honour
That’s what your understanding with your brother is, that you owed those monies back to him?
Husband
Of course
His Honour
When you had the family discussion in 2001 after your father’s death, why if you owed all that money to your brother did he agree to pay you $15,000?
Husband
Because I wanted ....inaudible.....matrimonial home so I needed some money to do something
His Honour
Well that might have been an arrangement you reached with your brother for him to pay you money, but if you owed him all that money why did he have to promise to pay you anything in respect of the property?
Husband
Well because the property is being later part of the settlement from my father’s house, so he have to be paid. …inaudible.....only have the money I told him I will repay you, at the moment ...inaudible.. my house and I try to saving more money to get loan
So, if the husband’s evidence is to be accepted without question then he would assert there was $2,000 owed to him by his brother from the $15,000 that he was promised from the settlement of his late father’s estate, but that the husband says no money is outstanding given the accommodation his brother has given him when the husband has travelled back to Macedonia.
The husband’s brother also gave evidence that on an overall basis, he believed he had provided the husband with $35,000 over the years since the husband has been in Australia. There is no basis upon which I should accept that sweeping statement.
At no stage in any of his financial statements has the husband indicated that his brother owes him money. Equally the husband in none of his financial statements indicates that he owes money to his brother.
Given the inconsistencies in the evidence about the flow of monies between Macedonia and Australia, it is unsafe to add back onto the balance sheet the $15,000 that the husband asserts was owed by his brother as a result of arrangements arising after the death of his father. Therefore, I have put a ‘nil’ value on the balance sheet in relation to monies allegedly owed by his brother.
There is, however, a corollary to the approach that I have taken on this issue which favours the wife. Whilst I will find that some monies have come in from Macedonia, given the conflict in the evidence between the husband and his brother I have no confidence as to what the overall movement has been of funds between the husband and his family in Macedonia during the period of the marriage.
CONTRIBUTIONS
Neither party asserted that there should be anything other than a global approach taken to the assessment of contributions.
The parties were together 16 years and had one child.
The husband seeks a 20 percent adjustment in his favour as a result of his contributions or contributions he says were made on his behalf. The wife’s position is that the contributions should be seen as equal.
Initial contributions
At the date of the marriage the husband had the following property:-
102.1.$10,000 in bank accounts;
102.2.$10,000 in cash;
102.3.A Peugeot motor vehicle.
At that time the husband was in full time employment as a tradesman and also had two or three other part time jobs in the same field.
The wife asserts that at the commencement of the relationship she had approximately $11,000 in savings and a Datsun motor vehicle valued at approximately $2,000.
The amount of $11,000 is disputed by the husband. The husband relies upon annexure E1 which is at page 43 of his primary affidavit; the annexure being the wife’s Commonwealth Savings Bank account. The wife had this savings account prior to the marriage. The account shows that as at 31 May 1989 the wife had savings of $12,477.50. An amount of $12,400 was withdrawn from that account on 31 May 1989. The parties married in September 1989. The husband wishes to make the point that this demonstrates that the wife was inaccurate when she claims in her affidavit that she had $11,000 in that account at the date of marriage. It is clear that that precise evidence is inaccurate, but it is also clear that only a short time prior to the wife commencing to live with the husband she had $12,400. She travelled to Macedonia with her mother and some of these funds may have been used for that purpose. Whilst it is not possible for me to know for sure what amount the wife had in savings at the commencement of cohabitation, I am prepared to accept it was in the order of $11,000.
Throughout the marriage the husband was employed a majority of the time and contributed his income to the benefit of the family.
The husband arranged for purchase finance, lease and ultimately the purchase of the C, L and G properties. He arranged or otherwise made improvements and repairs to each of the properties including the provision of his own labour.
In January 2002 the husband received an amount of $14,855.25 as a result of a workers’ compensation claim. The details of the breakdown of that amount (see Exhibit 2) are as follows:-
15% permanent impairment of the neck $6,000
5% loss of use of the right arm at or above elbow $4,000
pain and suffering $5,000$15,000
Less charge due to Health Insurance Commission $144.75
$14,855.25
Under the principles expressed in Aleksovski (1996) FLC 92-705, those amounts should be treated as a contribution made by the husband. The balance of the monies that the husband received under the workers’ compensation claim are referrable to lost personal exertion income.
The wife received an amount of $90,000 from the termination of her employment with P Company (see paragraphs 19 and 25 of her affidavit and paragraph 30 of the husband’s affidavit). There is no breakdown as to how the amount of the wife’s termination payment is calculated. The benefits were accumulated during the marriage and are likely to be connected with the onset of her illness during the marriage.
The wife contributed the whole of her wages when she was working during the marriage (see references to her working history in the chronology above).
Contributions as homemaker and parent
The wife’s contributions as homemaker and parent are detailed in paragraphs 12, 16, 17, 18, 21, 24, 26, 27, 28 and 36 of her affidavit.
The husband claims he made contributions as homemaker and parent.
The husband claims contributions by his mother as a homemaker from 1992 which included:-
114.1.Performing most (and then later all) of the duties of cooking and house cleaning for the parties;
114.2.Caring for the child during periods that the parties were at work in place of the paid carer that had previously been in place;
114.3.Caring and supporting the wife during periods that she was displaying symptoms of schizophrenia.
The husband claims that his contributions as homemaker and parent and his mother’s contributions as homemaker were made more arduous by virtue of the wife’s illness.
Assessing contributions arising from the wife’s illness/ special or “Kennon” style contributions
Legal principles
At times during the marriage the wife suffered to a greater or lesser extent from the effects of her schizophrenia.
The husband claims this meant that, from time to time, he and his mother, on his behalf, made contributions both financially and in the role of homemaker and parent which were elevated as a result of the wife’s illness and the wife made contributions which were diminished by her illness.
There is little Full Court authority as to how to weigh contributions which are made significantly more arduous by an illness of one of the parties.
There are a number of authorities which establish the proposition that conduct that is caused by an illness does not meet the test of being reckless, wanton or negligent and is consequently not in the nature of conduct described in Kowaliw & Kowaliw (1981) FLC 91-092. In Crampton & Crampton (2006) FLC 93-269 the Full Court considered that the wife’s gambling habit was an illness and losses due to that illness were not Kowaliw style losses.
In Keenahan & Keenahan (2004) Fam CA 360 the Full Court dealt with the question as to whether or not personal injury damages awards could be seen as entirely contributed by the husband who had been injured. The Full Court found that the trial judge had undervalued the wife’s contributions, particularly in caring for the husband and the children for four years after the husband’s accident until separation.
In that case the Full Court upheld the wife’s appeal and re-exercised discretion. In giving the wife a greater adjustment by way of property they commented:-
82.At the time of the accident, however, the two children were not yet 12 and just 8 respectively. From 19 January 1988 onwards the wife was effectively the sole contributor to the welfare of the family in the non-financial sense and she cared for the husband “to the fullest extent of her ability” for the four years between the date of the accident and separation. She made this contribution in an environment where the husband was difficult to get on with and at times “argumentative, abusive and physically excessive in his conduct to the wife”. Although not making specific findings about particular incidents or events, his Honour found that the behaviour of the husband “when evaluated, called for a recognition in the wife's favour”. [emphasis added]
83.In our opinion, these contributions of the wife go some way to reducing the significance of the husband's overwhelmingly greater financial contribution and would be adequately recognised by a contributions based entitlement of $700,000.
Both Cronin J in Eltham & Eltham (2007) Fam CA 657 and myself in F & M (2006) Fam CA 202 have dealt with similar arguments but in both cases, on the facts, the illness was not found to have made the contributions significantly more arduous.
In F & M I concluded as follows:-
218.In this case there are two reasons why no great weight should be placed upon the wife’s contributions that arose as a result of the husband’s conduct flowing from his illness. They are:
2.18.1Taken in context, the conduct referred to in Kennon is wilful conduct on behalf of one of the parties. The conduct in this case by the husband was not wilful in the sense that he had no control over his illness which was the cause of the conduct.
2.18.2The wife’s evidence in relation to the additional contributions that she made as a result of the husband’s conduct fall short of placing this case in the band of exceptional cases referred to in Kennon. The wife has not shown a “discernible” impact upon the nature and quality of the contributions that would take it outside the normal expectation that a marriage partnership is “for better or for worse”.
Mallet
In Mallet v Mallet (1984) FLC 91-507, Wilson J in a well known passage said at page 79,126:
The Act requires that the contribution of a wife as a homemaker and parent be seen as an indirect contribution to the acquisition, conservation or improvement of the property of the parties regardless of where the legal ownership resides. The contribution must be assessed, not in any merely token way, but in terms of its true worth to the building up of the assets. However, equality will be the measure, other things being equal, only if the quality of the respective contributions of husband and wife, each judged by reference to their own sphere, are equal. The quality of the contribution made by a wife as home maker or parent may vary enormously, from the inadequate to the adequate to the exceptionally good. She may be an admirable housewife in every way or she may fulfil little more than the minimum requirements. Similarly, the contribution of the breadwinner may vary enormously and deserves to be evaluated in comparison with that of the other party. It follows that it cannot be said of every case where the parties reside together that equal value must be attributed to the contribution of each. That will be appropriate only to the extent that the respective contributions of the parties are each made to an equivalent degree. What the Act requires is that in considering an order that is just and equitable the Court shall ``take into account'' any contribution made by a party in the capacity of homemaker or parent. It is a wide discretion which requires the Court to assess the value of that contribution in terms of what is just and equitable in all the circumstances of a particular case. There can be no fixed rule of general application.
Kennon
In Kennon (1997) FLC 92-757 Fogarty & Lindenmayer JJ said (at page 84,290):
“Although in this discussion reference is made exclusively to domestic violence, it is not intended to be confined to that issue. We do not consider that domestic violence is an exclusive category. It is the most obvious example of a wider and more general category of conduct which may be relevant within s.79….
(at page 84,294) Put shortly, our view is that where there is a course of violent conduct by one party towards the other during the marriage which is demonstrated to have had a significant adverse impact upon that party’s contributions to the marriage, or put the other way, to have made his or her contributions significantly more arduous than they ought to have been, that is a fact which a trial judge is entitled to take into account in assessing the parties’ respective contributions with s.79. We prefer this approach to the concept of “negative contributions” which is sometimes referred to in this discussion.
In the above formulation, we have referred only to domestic violence, for the reasons which we indicated earlier, but its application is not limited to that….
However it is important to consider the “floodgates” argument. That is, these principles, which should only apply to exceptional cases, may become common coinage in property cases and be used inappropriately as tactical weapons or for personal attacks and so return this Court to fault and misconduct in property matters – a circumstance which proved so debilitating in the past. In addition, there is the risk of substantial additional time and cost.
However, in our view, s.79 should encompass the exceptional cases which we described above….
It is essential to bear in mind the relatively narrow band of cases to which these considerations apply. To be relevant, it would be necessary to show that the conduct occurred during the marriage and had a discernible impact upon the contributions of the other party. It is not directed to conduct which does not have that effect and of necessity it does not encompass (as in Ferguson) conduct related to the breakdown of the marriage (basically because it would not have had a sufficient duration for this impact to be relevant to contributions).”
Cuneo
In Cuneo [2006] Fam CA 158 Coleman J was considering the effect of the husband’s depressive illness (which was a consequence of his horrific experiences in the Vietnam War) on the contributions of both the husband and the wife.
At paragraph 259 – 267 his Honour described and discussed the problem in the following way:-
259.In none of the authorities to which the Court has been referred does the question of intent seem to have been raised or considered in the context of a claim such as the wife pursues. In Kennon itself, under the cross vesting legislation then in force and effect, a substantial verdict for damages for assault was entered in the wife’s favour by the trial Judge. The obiter discussion of the potential impact of spousal conduct in Kennon in the Full Court related to substantially those same acts. There can be little doubt that, on its facts, the obiter in Kennon was directed to intentional or deliberate acts.
260.In this case, the Court finds that the wife’s allegations of the behaviour of the husband, as directed to her, have been established on the civil standard in the Briginshaw v Briginshaw (1938) 60 CLR 336 sense.
261.Whilst, to her credit, the wife has not established specifically that any contribution made by her was thereby more difficult, or that such behaviour impacted adversely upon her in any lasting sense, the Court accepts that, of necessity, the more extreme behaviour of the husband to which the wife was subjected must have rendered more emotionally or psychologically onerous the performance of her duties than would otherwise have been the case.
262.To conclude otherwise would involve a number of unacceptable notions. The first of those would be to punish a spouse who, as the wife in this case did, displayed uncomplaining resilience in the face of difficult circumstances in performing her contributions without diminution, and potentially to reward a less resilient spouse contributing in the same circumstances. Secondly, to dismiss the wife’s claim would be to ignore the common sense reality that there is a material distinction between a spouse who contributes in circumstances such as those found to have applied from time to time in this case, with identical contributions by a spouse in conditions lacking any such difficulties. Commonsense suggests that the contributions in the former case should, without demeaning those in the latter, be seen as somewhat elevated.
263.Implicit in these observations is acceptance of the notion that behaviour such as the wife complains of falls outside, and beyond, the kind of behaviour which, however annoying or persistent, forms what has sometimes been inappropriately described as the “rough and tumble” of married life. This is particularly so given that there is no suggestion by the husband that such behaviour as the wife described was provoked, incited or otherwise caused or contributed to by the wife herself.
264.The Court is accordingly persuaded that, whether in reliance upon the decision in Kennon, or subsequent decisions, or the decision of the High Court in Mallett, or the wording of s 79 of the Act itself, the wife’s contributions are entitled to be regarded more highly by reason of the husband’s behaviour to her subsequent to 1988. Such behaviour was clearly episodic although, as the evidence identified earlier makes clear, the impact of those episodes on the wife as she went about making her contributions was likely to have endured well after the episodes themselves had ended.
265.The Court has not thus far addressed the issue of intent, or the voluntariness of the husband’s conduct. As the submissions of Counsel for the wife perceptibly indicate, in this case the Court faces something of a dilemma. On the one hand, the behaviour to which the wife was subjected was unacceptable and was behaviour to which she should not have been subjected, at the hands of her husband or any one else. However, as was fairly conceded on behalf of the wife at all times, it is not suggested that such conduct by the husband was intentional, or committed in circumstances involving reckless indifference or possibly even “foreseeability”. It would not be exaggerating the concession made on behalf of the wife in relation to intent to suggest that it was acknowledged that the husband’s actions were involuntary. In the circumstances of this case, to adjust the wife’s contributions in the way in which a Court would, where the unacceptable behaviour intentional or committed with reckless indifference, would be to apply an unjustifiably strict test.
266.Albeit in the absence of clear authority permitting or precluding such a course, to fail to have regard to the “difficulties” which the husband’s behaviour after 1988 caused the wife in the performance of her contributions would be to fail to fully evaluate the nature and quality of the wife’s contributions. On the other hand, to fail to acknowledge that the cause of such behaviour was external to and beyond the control of the husband, being clearly referrable to the horrendous experiences he had during the Vietnam War, would also be unjust.
267.Without being entirely clear as to what is intended by the expression “weighing factor” appearing in the submissions of Counsel for the wife, the Court is of the view that to fail to reflect the impact of the husband’s behaviour on the rendering of contributions by the wife would be unjust but, to do so without moderating the adjustment to some extent by reason of the largely involuntary nature of such behaviour would be unjust to the husband. Clearly the exercise thus arising involves the exercise of discretion. Whilst acknowledging that others may well come to different conclusions on the same evidence, the Court is persuaded that a small adjustment in the wife’s favour would, on balance, be a proper approach.
I adopt Coleman J’s approach in Cuneo in this case.
THE FACTUAL BACKGROUND TO THE KENNON STYLE CLAIM IN THIS CASE
The wife’s medical history
In her affidavit sworn 22 November 2006 the wife gives the following information relevant to her medical history:-
25.In about June 1995 I suffered a breakdown and lost my job with [P Company]......
38.I suffer from chronic schizophrenia. I receive medical and specialist treatment from Dr [CA], psychiatrist of […].
41.I am currently in receipt of a disability support payment receiving $517.90 per fortnight.....
49.I acknowledge the assistance of the respondent’s mother with undertaking a proportion of duties as homemaker and the child [N] particular during the periods that I was working full time.
50.I also acknowledge the assistance of the respondent’s mother during times that I was not medically well. When I was not working I continued to do tasks and duties around the house. I was under medical assistance and receiving medication at times and was able to carry out duties as a homemaker and parent.
The husband’s evidence in relation to the wife’s medical history is more extensive. At paragraph 18 of his affidavit he says that during her pregnancy with N after a visit to Dr F, the wife said to him:
“I have been taking anti depressants since I was 15 years old. Now I take them only from time to time when I don’t feel well.”
There was an issue (of no great relevance) as to the time at which the wife was first diagnosed with schizophrenia. Counsel for the husband asserted that it was April 1992 but I do not accept that is so. The husband himself in paragraph 28 of his affidavit says that it was only in 1994 that Dr F diagnosed schizophrenia. In a letter written by Dr F (the GP) to psychiatrist Dr EF on 22 April 1992, Dr F writes, in the context of recording that both the wife’s mother and the wife’s brother have schizophrenia, “I have reassured her in this regard, that there does not seem to be any signs of schizophrenia”. (see annexure H to the husband’s affidavit at page 119).
In annexure I, Dr BR, a treating clinical psychologist who saw the wife in November 1994 noted “[The wife] developed schizophrenia in March 1994”.
I accept that after the wife was diagnosed with schizophrenia in March 1994 she continued to work at P Company until 31 May 1995. Dr BR concludes as follows:-
Current state of her mental health and effects on her daily life
[The wife] is suffering from a schizophrenic illness with paranoid symptoms. She has been unable to work since the disease manifested in March 1994 and the psychiatrist who is treating her, Dr [EF], has recommended that she will need help with looking after herself and her child indefinitely. Even with weekly injections of psycho-active medication, [the husband] reports that his wife is unable to do anything toward the care of their child and very little toward the maintaining of the day to day household tasks. Her prognosis is poor in the light of the strong history of schizophrenia in her family. She will require ongoing psychiatric are indefinitely.
The fact that [the wife’s] own mother has been incapacitated for many years with schizophrenia and indeed has required a great deal of emotional support from her daughter and that her brother also has the same illness means that there can be no support coming from her family of origin. Her mother-in-law, […], is the only available family member who is able and willing to offer the [family] the care and support that they require.
I infer that the wife had an acute incident in April 1994 which had her admitted to the casualty section of the Hospital (see report from the hospital at pages 124 & 125).
In a letter written to a solicitor by the wife in November 1994 (presumably for the purposes of obtaining a pension for the husband’s mother), the wife conceded that at that time the husband’s mother took care of the child and most of the duties within the household and assisted her with certain activities. In a document written by Dr EF in January 1996, he certifies that the wife needs assistance to help her with her daily tasks as well as to help her with a 6 year old little boy she has. He opines that he did not think that the wife would cope without her mother-in-law’s help.
This letter was written by the consultant psychiatrist in support of an application to the Department of Immigration to extend the husband’s mother’s visa or for the purposes of supporting an application for the granting of permanent residency. The doctor concludes that without her mother-in-law’s help the wife could not manage at all stating “She (ie the wife) is on a good deal of medication and she has acute schizophrenic episodes from time to time” (see page 131 of the husband’s affidavit).
In November 2003 the wife saw Dr ME in connection with a claim she made arising out of her employment with S Health Service.
At that time Dr ME described the wife as having a long standing “history of schizophrenia, probably of a paranoid type, which could be best described as episodic in nature with no or minimal inter-episode residual symptoms provided she remains on large doses of antipsychotic medication”. Dr ME also suggested that there may be an affective component to her illness and that she was on a mood stabiliser.
At times during her interview with Dr ME when talking about the person with whom she was having difficulties at work, the wife raised her voice to a level of shouting and appeared quite hostile, where as at other times during the interview she was settled and calmer.
Dr ME confirmed that the wife would need ongoing management by a treating psychiatrist. She concluded that the wife had an underlying serious medical illness but it was not in itself employment related.
The most recent report available to the court was done by a clinical psychologist, Dr GS, in March 2005 (husband’s affidavit, Annexure O; pages 140 – 146). He carried out a neuropsychological assessment. That report provides (undisputed) history that on 14 February 2005 the wife underwent disciplinary proceedings alleging that she was unsuitable for any type of administrative work within the organisation. The Health Service was at that time considering alternate work for the wife within the system (eg in cleaning or food service). The report really was simply designed to assess the wife’s cognitive levels of functioning as well as her emotional status.
Under diagnosis Dr GS said :-
‘Schizophrenia in remission’. Although her disease is well-controlled by antipsychotic medication, she has low emotional resilience and does not function well under pressure in a multi-tasking environment. Her impaired memory processes are not unusual in individuals with a history of schizophrenia.
He described her prognosis in the following terms:-
Prognosis is good for continued remission of her schizophrenia, whilst she complies with psychiatric treatment.
It is unrealistic for her to continue as an administrative officer, as she cannot cope with multi-tasking duties. However, she should be able to work in “lower pressure” duties under conditions of a structured environment and close supervision (eg food services or cleaning).
On the husband’s evidence the wife ceased employment with P Company on 31 May 1995 and remained at home until she found work in September 1999 in a volunteer capacity through a rehabilitation agency. She got part time employment in January 2000 and full time employment in March 2001 with S Health and worked in that capacity until mid 2005 when her employment was terminated.
I had the opportunity of observing the wife in the witness box for some time. That was an environment which was clearly stressful for the wife and it was clear to me that she did not function well under the pressure.
The wife has been receiving a disability pension from the Commonwealth Government for a period of two years, at the date of the hearing.
The wife receives specialist medical treatment from a psychiatrist (paragraph 38 of wife’s affidavit; paragraphs 6 and 29 of the husband’s affidavit).
I accept that at times during the marriage the wife’s ability to fulfil her role as homemaker and parent has been impaired by her mental illness.
Whilst this impairment has had some impact on the difficulty of the husband’s contributions, that impact has been minimal because most of the burden fell upon the husband’s mother.
Therefore, there should be a minimal adjustment in the husband’s favour arising from the contributions made by him as opposed to contributions made by his mother. I will now turn to consider the contributions made by his late mother.
Non-financial Contributions by the husband’s mother
Before her death, the husband’s mother swore an affidavit on 10 July 2006. The husband’s mother lived with the parties between 1992 and the first part of 2006. She was diagnosed with a terminal illness in July 2005. The husband’s mother died in September 2006. She says that the parties lived at her home in Macedonia for 5 – 6 months after they were married. During that time she says she undertook most of the duties of home making, cooking the meals and cleaning and the like with some assistance from the wife from time to time.
She travelled to Australia in 1992 and lived with the husband and wife and her new grandson, N. She asserts “it was my intention at that time to remain with them for up to six months”. Her husband, who was ill at the time, remained in Macedonia.
The husband’s mother’s evidence is that she made an offer to both the parties to look after her grandson. He was previously looked after by friends of the husband and wife whilst the husband and wife went to work. The husband’s mother says that from the day after she arrived in Australia she took over the care of her grandson and commenced to look after the household which included cooking, cleaning, washing and ironing while the parties were at work. At this stage she asserts her son was working six days a week and her daughter-in-law was working five days a week. She says that even when the mother was home on weekends she would do most, if not all, the housekeeping but she concedes that she shared looking after the child on weekends with the mother and that the father assisted on some days.
The husband’s mother agrees with the husband’s evidence that the supplies for the household were obtained by all of them going out shopping together but the grandmother not actually doing any shopping for herself. She said that her son and daughter-in-law bought items when shopping.
The husband’s mother says that she continued to do most of the housework even in periods when the mother was off work.
The husband’s mother in her affidavit says that it was only a month or so after she arrived in Australia that she observed that the mother appeared to be very unwell, describing her as looking very pale and sitting in a chair or on her bed for up to several hours at a time without getting up.
The husband’s mother says in 1992 the mother indicated that she was feeling better and she commenced work with P Company. The grandmother says that the wife said to her “Mama, will you stay and look after [the child] and the house?”
The husband’s mother said that she agreed. She obtained an extension to her six month visa.
She says that in 1995 the wife appeared to be very ill again.
She asserts that she did the majority of the household chores because the mother was too unwell to give much help between 1995 and up until 2001 or 2002.
The husband’s mother went back to Macedonia in 2003 (taking her grandson with her) for 3 months. The husband paid for his mother and his son’s travel expenses.
I find the husband’s mother’s contributions were made significantly more arduous during some periods by the wife’s mental illness.
Counsel for the wife submitted that the assistance by the husband’s mother by way of child minding and domestic assistance cannot be taken into account as a contribution under Section 79(4). Counsel referred to the decision of Mullane J in AB & ZB (2003) FLC 93-140. In that case his Honour concluded:-
“...whereas paragraphs (a) and (b) subsection 79(4), which deal with contributions to property, specifically include, contributions by a person on behalf of one of the parties to the marriage, paragraph (c), which is about contributions to the welfare of members of the family, does not.”
Counsel for the husband relied on the decision of Lindenmayer J in Rickaby (1995) FLC 92-642. In that case his Honour was dealing with rent free accommodation provided to parties to a marriage for seven years and said:
“In the circumstances of this case I regard that as a significant contribution to the welfare of the family on behalf of the wife, see Gosper & Gosper (1987) FLC 91-818.”
Mullane J in AB & ZB concluded:-
“But in neither Gosper’s case nor in Rickaby did the judgment acknowledge the difference in the wording I have referred to between paragraph 79(4)(c) of the Family Law Act in providing for contributions to the welfare of the family, compared with the provisions of paragraphs 79(4)(a) and (b), providing for contributions to property. Accordingly I do not consider that either case is persuasive authority that contributions to the welfare of the family made by another person on behalf of one or both of the parties to a marriage can be taken into account under paragraph 79(4)(c).”
With respect, whilst Justice Mullane is correct in his conclusion in relation to paragraph 79(4)(c) FLA, that is not the end of the matter. Section 79(4)(e) FLA provides that the court can take into account “matters referred to in sub-section 75(2) so far as they are relevant:. Section 75(2)(o) FLA provides that the court can take into account any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account.
The Full Court decision in Aleksovski v Aleksovski (1996) FLC 92-705 (Baker and Rowlands JJ) said at page 83,434:-
“In our opinion, the Gosper principle may extend to contribution by grandparents of a non financial kind pursuant to s.75(2)(o).”
In Aleksovski Kay J disagreed on that point and said at page 83,440:-
“It seems to me that the extension of Gosper principle to child-minding by grandparents is problematic. Whilst it is true that the catalyst for the provision of the services is the relationship between parent and child (that is, the grandparent and the parent), frequently the service is provided out of the natural love and affection between the parent and the grandchild and for the reciprocal benefits that flow back to the care giver in terms of personal satisfaction, relationships and “occupational therapy.
Absent any direct evidence as to the commercial consideration surrounding the arrangement with the care giving grandparent, in my view it is generally inappropriate to place any significant weight upon such a contribution.”
The Gosper principle referred to was a statement made by Fogarty J in Gosper & Gosper (1987) FLC 91-818. In Gosper at page 76,168 Fogarty J opined the following:-
“The critical case is where a relative of one of the parties gifts property to both of the parties to that marriage. Dependent upon the circumstances of the case it is, in my view, open to Court in such a case to look at the actuality and treat that as a ``financial contribution made directly... on behalf of'' the spouse relative (see for example Rainbird, Matthews, W., Underwood, Abdullah, Freeman, cf. Cleary, Hogan J. in Freeman, and Antmann).
In many such cases that gift was made only because of that relationship and in reality as a means of benefiting that relative in that marriage. It was made ``because she was a daughter of that family'' as was said in W.'s case at p. 75,527.
It is clearly a ``financial contribution'' and one ``made directly'' to the acquisition, conservation and improvement of property. In such cases it is open to the Court to conclude, if the facts justify it, that it was made ``on behalf of'' one spouse.
In other cases the evidence, including evidence that the donor intended to benefit both spouses, may not justify that conclusion. If so, the application by the parties of that property to the marriage would, at least at that point, be an equal contribution by them.”
The Full Court in Kessey and Kessey (1994) FLC 92-495 said that there was nothing they wanted to add to Fogarty J’s conclusions.
However, the Full Court in Kessey put the following gloss on Gosper at page 81,150:
“There is certainly nothing inconsistent, in our view, between the trial Judge's approach and the statements of principle made by Fogarty J. in Gosper. It may well be, however, that the trial Judge's approach and our approval of it, go somewhat further than what was said by Fogarty J. in Gosper. This is because this case would establish that where there is no evidence of any intention by a parent-donor as to whether he or she wished to benefit only his or her child or also to benefit the spouse of the child as well as the child, then the fact of the parent-child relationship, especially in circumstances where that has been a relationship of support on the part of the child, will be sufficient to establish a contribution of the donation by or on behalf of the child of the parent. In other words, a contribution by a parent of a party to a marriage to the property of the marriage will be taken to be a contribution made by or on behalf of the party who is the child of the parent unless there is evidence which establishes it was not the intention of the parent to benefit only his or her child.”
At paragraph 14 of her affidavit the husband’s mother says “I remained with the family to assist them because of my love for my son, [the wife] and my grandson.”
At paragraph 15, the husband’s mother says on occasions when they were talking about the wife going to see a doctor because the wife was unwell the husband’s mother said that she responded to both her daughter-in-law and her son in the following way:-
“Don’t worry. I’m happy to continue to look after you and the family.”
In the context of her evidence, the word “you” in paragraph 15 is best interpreted as a reference to both of the son and daughter-in-law and the reference to “the family” is best interpreted as a reference to the family consisting of the four persons who lived in the matrimonial home.
This evidence was reinforced by evidence from the wife. She agreed for the time her mother-in-law was with them in Australia, the husband, wife, husband’s mother and grandchild lived together as a family and her mother-in-law loved her and she loved her mother-in-law. This was said by the wife whilst acknowledging that there were problems that arose both from her illness and from the fact that two women were in the same kitchen together.
I conclude that there is evidence that the intention of the husband’s mother was that she made contributions to the household, not just because of her love for and her connection with her son, but also because of her love for her daughter-in-law and her love for her grandson.
The husband’s case is underpinned with an assumption that contributions made by his mother will be treated as contributions made by his mother only on his behalf. I find in this case that that presumption is not founded on the evidence. There is evidence in this case which establishes it was not the intention of the husband’s mother to benefit only her son by the non financial contributions that she made.
It follows that submissions made on behalf of the husband that the wife’s behaviour made his mother’s contributions significantly more arduous is not a submission of particular weight given that I have found that the contributions of a non financial nature made by the husband’s mother were not made solely on behalf of her son.
Monies from Macedonia
The husband says that between August 1990 and October 1995 his brother, K, gifted to the husband monies between $31,804 and $33,804 as follows:-
179.1.$23,804 into the husband’s bank account;
179.2.$8,000 - $10,000 provided in cash.
K is now 42 years of age and is a business proprietor, owning a transport business in Macedonia.
He says that when his mother went to Australia in January 1992 he observed that she took with her $9,500 (AUD) in cash and that he recalled counting out that money on a day or so prior to her departure for Australia. He recalled his mother saying to him at the time “I am going to give $8,000 to [the husband] and I have $1,500 to spend for myself”.
Both the husband’s mother and the husband agree that that is the amount of money that his mother brought with her to Australia in 1992.
In his written evidence, the husband’s brother asserts that he provided the following amounts to his brother on the following days:-
19 September 1990
$3,000.00
1992 (via Mr [V]) 5,000.00 7 August 1992 2,472.00 February 1993 3,000.00 October 1993 2,500.00 April 1994 3,000.00 30 September 1994 3,028.00 13 October 1994 2,162.00 18 October 1995 2,614.00 $26,776.00
These particulars do not sit neatly with the brother’s oral evidence that he sent more than $35,000 to the husband in Australia between the time the husband had left Macedonia and up to about 1995, 1996 or 1997 (he could not say exactly).
In relation to “1992 (via Mr [V])”, the husband’s brother says he gave $10,000 (AUD) to Mr V, barrister, to bring this money to Australia. $5,000 of it was to be given to his brother in one envelope and $5,000 to his mother in another envelope. Mr V gave evidence that he had done that.
I have already commented about the difficulty that I have had in accepting some of the evidence by the husband’s brother, particularly in respect of monies said to be paid by him after 2001.
The husband says that upon her arrival, the husband’s mother gifted to him an amount of $8,000.
This was modified in oral evidence where the husband indicated that he had paid his mother’s airfares to bring her to Australia at a cost he estimated to be approximately $2,000.
In 1995 the husband purchased in his sole name a property known as C property for $105,000 plus the costs of acquisition. He borrowed $88,000 by way of mortgage to the Commonwealth Bank with the balance of the purchase monies together with legal expenses and stamp duty from monies that he had. The husband claims that $30,000 - $40,000 worth of improvements were carried out to the property.
The parties lived in this property from 8 March 1995 to 20 July 2004.
In 1995 the wife’s employment with P Company ceased and she received about $90,000. On the first day of the husband’s oral evidence he indicated that he believed between $60,000 - $70,000 of this money was used to reduce the mortgage on the C property. On the final day of the hearing the husband amended that evidence and said, having checked records, the amount applied to the reduction of the mortgage from the wife’s termination monies was $83,546.50. He said at that time she still had about $10,000 in her personal account.
The husband says that in 1995 he commenced investing in public company shares.
In February 1996 the husband purchased L Property for $72,500. He borrowed $70,000 by way of mortgage and the balance and acquisition costs came from savings. The husband says he carried out improvements to this property which was rented out until 8 June 2006.
The husband says that his mother commenced to receive a carer’s pension in June 1997 and in 1998 she lent him proceeds from her pension.
In July 1998 the husband purchased the G unit for $155,000. He borrowed $150,000 by way of mortgage.
The husband says that on 1 July 2002 he made an application for a $50,000 to Geared Equities Investment for a term of three years and that that application was approved.
In September 2002 the husband says that his mother gave him $5,000.
In 2003 the parties jointly purchased the former matrimonial home for $540,000. The parties borrowed $515,000 by way of mortgage to the Commonwealth Bank.
On 8 March 2004 the husband says he was granted 1,000 PB Ltd shares.
The husband invested in shares and other financial products from which the parties ultimately received income. The husband borrowed $50,000 from Macquarie Bank on 16 June 2004 to purchase shares. On 28 July 2005 the husband says that he “unwinds” the Geared Equity Investment and is paid the sum of $26,757.35. The husband had some doubt about how good an investment this was given the amount of money he had paid on interest over the period that he had the borrowing for shares and the capital gains tax he paid on the shares at the end of the day.
The husband says that he attempted to sell the C property in August 2004 but the property was withdrawn from sale in April/May 2005 because of what he claimed was a poor real estate market.
Between July 2005 and June 2006 the husband sold shares in public companies (see annexure GG to husband’s affidavit, pages 237 – 239).
On 7 June 2006 the C property was sold for $220,000. A sum of $117,498.70 was paid to the Commonwealth Bank in reduction of the mortgage liability. The wife received $55,000. The husband received $40,000 from the proceeds.
The contracts for the sale of the L property were exchanged on 1 August 2006 and the settlement took place on 15 September 2006. The amount received from the sale was $139,000. The amount of $132,630.66 was paid to the Commonwealth Bank in reduction of mortgage liabilities.
Monies the husband claims were provided by his mother
The husband claims that his mother gave him monies totalling $100,700 as follows:-
205.1.In 1991 gifts of $8,000;
205.2.Various amounts which the husband’s mother received from gifts from other persons;
205.3.September 2002 the sum of $5,000;
205.4.Monies received from the mother’s pension from 1997. Counsel for the husband claims that the following calculation can be done:-
$352 x 9 years x 26 weeks per year = $82,600.
He said it was higher than this because the pension went up over the years.
In his financial statements the husband asserts that he owes his mother $100,700. Whilst that conclusion was struck out on objection from the husband’s mother’s affidavit, it remained in paragraph 52 of the husband’s first affidavit sworn 30 November 2006. The husband says that the greater portion of that amount came from his mother’s carer’s pension (which she commenced to receive in Australia in 1997). He says the balance represents the additional amounts that she gave him from time to time.
The husband’s case was not that the sum of $110,000 should be placed on the balance sheet as a liability owed by the husband to his late mother’s estate but rather that this is the most significant contribution in the history of the marriage from an outside source and that it is to be categorised as a contribution made on behalf of the husband by his mother.
At paragraph 52 the husband gives evidence that from about the time of the purchase of the G unit he had authority to draw on his mother’s Commonwealth Bank account. However, his evidence was that normally his mother would go to the bank, sometimes with him sometimes not, withdraw cash and hand it to him. She did not retain any money herself. The husband without objection makes the following submission in paragraph 52 of his affidavit in relation to payments made by his mother:-
“By giving this assistance, I was better able to meet mortgage payments and other outgoings for the property as well as to purchase shares from my income.”
The other paragraph I was referred to was paragraph 62 of the husband’s affidavit which is an alleged conversation supposedly in the presence of the wife although she denies it, where there was an agreement reached that moneys that the mother had paid her son over the years would be repaid to her.
However, as I have already said, at the hearing the husband did not attempt to put this alleged “debt” to his mother’s estate on the balance sheet. Counsel for the husband indicated that some of it would be statute barred in any event. The husband was content to press the use made of the mother’s pension as contribution on his behalf during the marriage.
There are two major difficulties with the husband’s submissions on this issue:-
211.1.The first is that the submission treats his mother’s pension income as if it was net income without any expenses needing to be deducted from it. The evidence is that the family unit in Australia provided for virtually all of the husband’s mother’s needs in Australia from 1992 until when she returned to Macedonia permanently. She lived the whole of this time in Australia, apart from a three month trip back to Macedonia. The evidence is that when the family went shopping together, pooled funds were used to pay for the weekly grocery bill. The husband paid for outgoings on the accommodation in which his mother lived whilst she was in Australia and the utilities associated with that accommodation. The family unit provided transportation for the husband’s mother and although I do not have specific evidence, I infer paid for most of the other things that she needed from time to time. The husband has not attempted in any way in his case to quantify the expenses that he paid on behalf of his mother over this period and in those circumstances its not of any great assistance to say that in the nine years between when his mother first started to receive an Australian pension and when she permanently went back to Macedonia he collected $82,000 from her.
211.2.The second problem with the submission is the underlying assumption that this payment by the husband’s mother to the husband was intended only for his benefit. I have discussed above the evidence is that the husband’s mother was living in a loving family unit, contributed from monies that she received into that family unit and in return was supported by that family unit by having her daily needs satisfied. The assumption she was doing that simply on behalf of her son is not sustainable.
For these reasons, I do not weigh in the husband’s favour, contributions he says he made from his mother’s pension.
The husband asserts that since separation he has been responsible for payments of all the household and investment property expenditure including the expenditure relating to the child.
Conclusions in relation to contributions
As set out earlier in these Reasons, the husband’s position is that there should be a 20 percent adjustment in his favour as a result of his contributions or contributions he says were made on his behalf. The wife’s position is that the contributions should be seen as equal.
I am of the view that taken as a whole and looking at:-
215.1.Monies which came from Macedonia between 1990 - 1995;
215.2.The contributions made by the husband which were made more arduous by the wife’s schizophrenia and discounting the weight I give that factor because the cause of that was the wife’s illness (as I have said this leads to a minimal adjustment);
215.3.The contribution by the husband of his income through personal exertion throughout the marriage;
215.4.The payment by the wife of $83,546 off the C property mortgage from her termination payment in 1995.
215.5.The contributions the husband has made post separation.
I am of the view that there should be a 5 percent adjustment in favour of the husband on contributions.
SECTION 79(4)(d) – (g) MATTERS
The wife is a 44 year old woman who suffers from chronic schizophrenia. I have discussed details of the wife’s medical history above.
It seems that the wife’s serious medical illness has, at different times disabled the wife at various levels of severity. The most recent report by Dr GS (husband’s affidavit; Annexure O) indicated that the wife might be able to be re-employed by the health service for whom she worked, in more menial occupation.
However, I infer that that did not happen and she was able to obtain a disability pension instead.
The husband challenges the wife’s employment capacity. He claims that she has the capacity for gainful employment. The husband points to the fact that the wife earned $22,873 in 1995.
It might be that the wife is able to re-enter the workforce at some time in the future but when that might be and what work she might obtain is highly speculative. The wife’s medical condition is a significant s.75(2) factor that I need to weigh in her favour.
The wife currently receives a disability support payment of $517.90 per fortnight.
The wife is not residing with any other person.
The wife has a need to be able to accommodate herself following the orders.
Husband’s health
The husband is 49 years of age. In the husband’s affidavit sworn 30 November 2006 he sets out some information in relation to his health at paragraphs 2, 3 and 4 and annexures A and B.
It is unclear from the evidence given by the husband as to whether or not his current medical complaints are serious and how any current medical complaint affects his earning capacity. The husband says that he was diagnosed as suffering from a brain tumour in 2000 and goes for six monthly checkups with an Endocrinologist. There is some evidence that the husband took anti depressants in the past and may be seeking attention in respect of depression in the future.
The husband is currently employed and claims he is working to his capacity. He claims his current income is $760 gross per week with PAYG of $117 per week.
Following the proceedings the husband will continue to have some financial commitment to the child who is now 18 and who was expected to commence tertiary education this year. I accept that it is unlikely that the wife will be able to make any financial contribution for the child.
The husband will retain superannuation entitlements which are currently worth $56,199 and are about 15 percent of the overall pool ($56,199/$370,925). The wife also has superannuation of $16,169. The parties have agreed that these amounts are to be added to the balance sheet, so it would be a double counting to take these amounts into account at the third step.
Conclusion in relation to Section 79(4)(d) – (g) factors
These matters predominately favour the wife.
The husband’s earning capacity is superior than the wife’s looking forward into the medium term. It may well be that the wife is able to obtain some employment in the future at some time. However, it is likely that her future employment will be episodic at best.
It was put to her by Counsel for the husband that if things were desperate she could go home and live with her mother. The wife explained to Counsel for the husband that both her mother and her brother who lived in the house were schizophrenic and that “it is not healthy to have too many sick people in the one house”.
Counsel for the wife sought a 10 percent adjustment in favour of his client by way of s.79(4)(d) – (g) factors. This was, however, on the basis that the adjustment on contribution would be 50/50. Overall, Counsel for the wife sought a 60/40 split in his client’s favour.
Counsel for the husband said there should be no adjustment for s.79(4)(d) – (g) matters.
It is my view that there should be a 10 percent adjustment in the wife’s favour for these matters, particularly having regard to the size of the pool that is being divided.
During evidence the wife indicated that she intended to use a good deal of the capital that she received as a result of these proceedings towards her re-accommodation.
JUST AND EQUITABLE
Consequently, based upon my assessment of contributions and s.79(4)(d) - (g) matters, the overall adjustment in this matter would be 55 percent to the wife and 45 percent to the husband of the available asset pool.
That could be achieved by the following distribution:
H gets 45.0% Assets Item No. Description Percentage Value 1 The former matrimonial home 100% $420,000 3 Monies received by the husband as partial property settlement 100% $55,000 4 Husband's superannuation benefits 100% $56,199 5 Husband's 1989 Magna Executive 100% $2,550 6 PB Ltd (2,777 @ $3.59) 100% $9,969 7 IAG Shares (57 @ $5.72) 100% $326 9 Furniture and contents 50% $2,500 10 Add back husband's legal costs sourced from monies returned to him by Commonwealth Bank on 5.2.07 100% $25,000 11 Share acquisition plan 100% $5,981 Liabilities Item No. Description Percentage Value 13 Amount required to discharge mortgage over former matrimonial home 100% $254,517 14 CGT 100% $25,752 H pays W $130,340 Net Assets $166,916 W gets 55.0% Assets Item No. Description Percentage Value 2 Monies received by the wife as partial property settlement 100% $55,000 8 Wife's First State Super 100% $16,169 9 Furniture and contents 50% $2,500 W receives $130,340 Net Assets $204,009
Standing back, it is my view that dividing the assets and liabilities in that way is just and equitable.
As I indicated during submissions, the husband should have an opportunity of purchasing the wife’s interest in the home. To do so as set out above he will have to pay to the wife an amount of $130,340.
If he is unable to do that in a period of 56 days, then there shall be a sale of the matrimonial home. The wife will receive 79 percent of the net proceeds of the sale, which I have calculated as the amount payable by the husband divided by the value of the home, less the amount of the mortgage. ($130,340/$420,000 - $254,517). For the purposes of this calculation I have disregarded sale expenses.
I certify that the preceding two hundred and forty-one (241) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Watts
Associate:
Date: 6 June 2008
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