Deffia and Zuddro

FAMILY COURT OF AUSTRALIA

DEFFIA & ZUDDRO

[2009] FamCA 1244

FAMILY LAW – SPOUSAL MAINTENANCE
FAMILY LAW – CHILD SUPPORT

Child Support (Assessment) Act 1989 (Cth)
Family Law Act 1975 (Cth)

C v C [1998] FamCA15
Forbes & Bream [2008] FamCAFC 189

APPLICANT:

Ms Deffia

RESPONDENT:

Mr Zuddro

FILE NUMBER:

MLC

12376

2007

DATE DELIVERED:

18 DECEMBER 2009

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

DESSAU J

HEARING DATE:

27 JULY, 18-23 NOVEMBER 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Cantwell

SOLICITOR FOR THE APPLICANT:

Hogg & Reid

COUNSEL FOR THE RESPONDENT:

SOLICITOR FOR THE RESPONDENT:

Orders

That arrears of the spousal maintenance fixed at $4,550 shall be and are hereby discharged, and the order for spousal maintenance made on 25 August 2008 is hereby dismissed.
That there shall be a departure order from the administrative assessment of the Child Support Agency in relation to the child … born … February 2004 pursuant to s 117 of the Child Support (Assessment) Act so that in addition to any administrative assessment the husband shall pay:
(a)The child’s fees at S School from the start of her preparatory year (2010) to the end of Year 4; and
(b)The child’s private health insurance.
That all other applications shall be dismissed and the case removed from the list of cases awaiting finalisation.
That pursuant to the Family Law Rules this matter reasonably required the attendance of counsel.

IT IS NOTED that publication of this judgment under the pseudonym Deffia & Zuddro is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 12376 of 2007

MS DEFFIA

Applicant

And

MR ZUDDRO

Respondent

REASONS FOR JUDGMENT

INTRODUCTION

This case started with hotly contested parenting issues, and the wife’s applications for spousal maintenance, arrears of spousal maintenance, and a child support departure order. Only the arrears and parts of the child support issues remained by the end of the hearing.
The parties (and an Independent Children’s Lawyer) handed up consent orders in relation to the parenting orders. Following an allegation by the mother that the father’s new wife had assaulted their five-year-old daughter, sadly, the father decided to “waive his rights” to spend time with his daughter. He said he simply could not cope with the mother’s on-going alienation of the child (which she denied), and the harm it was doing to her. Every effort to persuade the father to take a different course failed. The sad upshot is that this little child will not see the father she loves and needs.
The obvious bitterness between the parties was then played out in relation to the financial issues. There were no property proceedings, as the parties had entered a binding financial agreement on the eve of their very short marriage. The agreement provided for the husband to keep the assets he brought into the marriage. The wife was challenging the binding financial agreement, until she dropped it in December 2008.
The wife was seeking $220 per week by way of spousal maintenance, in line with an interim order made by FitzGibbon SR on 25 August 2008. After her evidence in cross-examination on the third day of the hearing, when she said she sought spousal maintenance by way of “compensation” for not receiving any maintenance in the first year after separation, she conceded that she could not pursue the claim for spousal maintenance. It was dropped.
Arrears of maintenance arising from the interim orders were agreed at $4,550. The husband says that his financial position has not permitted him to make payments since the middle of this year, and he simply cannot afford to pay the arrears. That remains in dispute.
Since April 2009, child support has been assessed at $134.08 per month (about $31 per week). The wife seeks a departure order for the husband to pay an on-going sum, unspecified in her application, but specified in her evidence at $229 per week. She also sought Catholic school fees until the end of Grade 4, anticipated at $2,016 per year when the child starts her preparatory year in 2010. Towards the end of the hearing, the father agreed to pay those primary school fees at St Primary School until the end of Year 4.
The wife had also sought secondary school fees for a Catholic College, but in the course of the hearing, conceding that the child’s secondary schooling was too far into the future, she dropped that part of her claim.
The husband has always paid health insurance cover for the child as part of his family cover. The wife seeks that he continue to pay. He says he will try to do so but would not agree to the order. That remains in dispute.

BACKGROUND

The husband, Mr Zuddro, is aged 47. He is a qualified chartered accountant. He is not working in that capacity at present. His income-earning capacity is very much at the heart of this dispute and I shall return to it in detail below. He remarried in June 2009. His new wife is a self-employed financial adviser.
The wife in this case is Ms Deffia. She is aged 41 and says she is currently engaged in home duties. Her income-earning capacity, and whether or not she is working for cash, is also something to which I shall return. The child lives with her full time.
The parties started living together in June 2003 and married in June 2004. They separated very soon after that in December 2004. In February or March 2006 they reconciled until their final separation on 25 July 2007.
The husband was spending substantial time with the child until March 2009, when it stopped in the circumstances referred to above.

MATERIAL RELIED UPON AND ORDERS SOUGHT

The wife relied upon the following documents:
·Her further amended application filed 1 June 2009
·Her affidavit filed 4 November 2009
·Her financial statement filed 4 November 2009
·The affidavit of her brother filed 4 November 2009.
The husband relied upon the following documents:
·His response filed 30 November 2007
·His affidavits filed 4 November 2009, 14 April 2009. 13 February 2008, and 30 November 2007
·His financial statement filed 4 November 2009.
The husband also relied on the reports of his GP, Dr A and a psychologist, Ms P. Both were cross-examined.
The wife was represented by Mr Cantwell of counsel. The husband represented himself. He did so in a meticulous and comprehensive manner. At the start of the case I ensured that he had a copy of s 72 and s 75 of the Family Law Act, and s 117 of the Child Support (Assessment) Act.
This case took substantially longer than it should have, given the remaining issues. A contributing feature was the long affidavit filed on behalf of the wife, prepared by her solicitor Ms Cantwell. It comprised 52 pages with 164 paragraphs (74 paragraphs of which related to financial matters) with 47 annexures that were extremely voluminous.

THE RELEVANT LEGAL PRINCIPLES

Arrears of Maintenance

I must decide if the husband has the capacity to pay the $4,550 arrears of spousal maintenance. It is a discretionary matter. By way of guidance, I note the unreported decision of Baker, Lindenmayer and O’Ryan JJ in C v C [1998] Fam CA15 to the effect that the date upon which a party’s capacity to meet an order for arrears is assessed is the date of the hearing.

Child Support

Section 117 of the Child Support (Assessment) Act 1989 sets out the matters about which the court must be satisfied before making a departure order.
Section 117(1) provides that the court must be satisfied that there is a ground for departure, but also that an order is “just and equitable” as regards to the child, the carer entitled to child support, and the liable parent, and that it is “otherwise proper”.
Section 117(2) sets out the grounds for a departure order. The wife relies upon s 117(2)(c)(ia), to the effect that in the special circumstances of the case, the administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support provided by the husband for the child because of his “income, property and financial resources.” I note that in paragraph 10 of the wife’s Further Amended Application, filed 1 June 2009, she refers to s 117(c)(i). That is clearly not stated correctly, and although the error was not fully picked up (at least so far as sub-section (i) as opposed to sub-section (ia) is concerned), I am satisfied that the case proceeded on the basis that the major issue was the husband’s financial position. The addresses of the parties made it clear that each understood that was the focus.
Section 117(4) sets out the matters for the court to consider in determining that it would be “just and equitable to make an order”. They include the income, property and financial resources of each parent, the earning capacity of each parent, and the direct and indirect costs in providing care for the child incurred by the parent entitled to child support.
In determining whether it is proper to make an order, s 117(5) provides that the court must have regard to the parent’s duty to maintain a child, and the effect of an order on any entitlement of the carer to an income-tested pension allowance or benefit. As well, in having regard to the proper needs of the child, the court must have regard to the manner in which the parents expected the child to be cared for, educated, or trained (see 117(6)).
Section 117(7A) and (7B) are important in this case. Section 117(7A) provides that in having regard to the income, property and financial resources of a parent of the child, the court must have regard to the capacity of the parent to derive income, including any assets held by or for a parent that do not produce but are capable of producing income. Further, the court must disregard the income-earning capacity, property and financial resource of any person who does not have a duty to maintain the child unless in the special circumstances of the case the court considers that it is appropriate to have regard to them. Finally, the court must disregard any entitlement of, in this case the mother, to an income-tested pension allowance or benefit.
Section 117(7B) provides that in having regard to the earning capacity of a parent, the court may determine that the parent’s earning capacity is greater than is reflected in his or her income only if the court is satisfied that:
(a)one or more of the following applies:
i.the parent does not work despite ample opportunity to do so;
ii.the parent has reduced the number of hours per week of his or her employment or other work below the normal number of hours per week that constitutes full-time work for the occupation or industry in which the parent is employed or otherwise engaged;
iii.the parent has changed his or her occupation, industry or working pattern; and
(b)the parent’s decision not to work, to reduce the number of hours, or to change his or her occupation, industry or working pattern, is not justified on the basis of:
1.the parent’s caring responsibilities; or
2.the parent’s state of health; and
(c)the parent has not demonstrated that it was not a major purpose of that decision to affect the administrative assessment of child support in relation to the child.
Section 117(7A) and (7B) were introduced in 2006. The double negative in s 117(7B)(c) adds to the challenge of its interpretation. Not a great deal has yet been written on it. The Full Court did however observe in Forbes v Bream [2008] Fam CAFC 189 that the “limiting factors” in s 117(7B) apply “in all stages of considering whether to make a departure order”.

THE ISSUES

The major issue is the husband’s financial position and his income-earning capacity. There is also an issue as to the wife’s capacity to work. That is not as significant an issue in light of the remaining matters to decide, but it is relevant.

The Wife’s Financial Position and Her Income-Earning Capacity

The wife’s case is that she proposes to start work when the child starts prep in February 2010, having chosen to stay home to look after her while she has been at a pre-school stage. Her evidence was that she has been receiving only $392 per week, being a parenting payment of $290, family tax benefit of $71 and child support of $31. She swore that she has not been doing any paid work whatsoever. I cannot accept her evidence.
A private investigator, hired by the husband, followed the wife to her sister’s shop on 22 April 2008. He filmed her serving at the shop. She strongly denied that she was working. I made it clear that I would consider a certificate for the wife under s 128 of the Commonwealth Evidence Act, in light of an allegation of what could be social security fraud. Mr Cantwell was insistent, upon instructions, that the wife denied that she had performed any paid work and did not require such a certificate.
The wife’s account of the day was unimpressive. Her version was that she was at the shop from after dropping the child at kindergarten in the morning, until around 2.30pm when she left to collect the child. She was adamant that she collected the child that day, as every day. When the relevant DVD was played, and the timing showed she left the shop at 4.56pm, it was difficult for her to explain the discrepancy.
The wife insisted that she was only at the shop to use the computer to complete her birthday invitations. Her evidence about that was a muddle. It changed as she saw the obvious difficulties in it. To explain the hours she spent at the shop, she had claimed to have been making a substantial number of invitations in the course of the day. When it was noted that the RSVP date was 26 April, just several days’ hence, her evidence changed so that she said she was only making invitations for “select people”, as most guests had been invited in advance by telephone or email. Her prevarication was unimpressive. And the fact that she was making a smaller (although indeterminate) number of invitations left unexplained her reason for being at the shop for so many hours.
Most importantly, she was seen serving, wearing the shop apron and cap, both with shop logos. She had denied wearing a “uniform” but once I saw the outfit, that struck me as a disingenuous answer.
The wife asked me to believe that she simply stepped in to serve one Italian-speaking customer on behalf of her sister. In the circumstances of the film, and her unsatisfactory evidence, I find that improbable. Although I cannot say definitively how much she has earned, I find it is probable that she has been in receipt of some income from paid work.
The wife enjoyed a successful career in the past in the retail sector. Her last full-time role, before she became a mother, was a manager for a retail chain. During the first separation from the husband, although she had the substantial care of their baby daughter, she was in paid work and lived independently. That history adds to the probability that she has been in paid work, particularly as the child has been attending child care or kindergarten for some parts of the week. It would help explain, as brought out by the husband in his cross-examination of the wife, how her expenses show that, despite a very low income, she has continued to spend $32 per week on her own hairdressing and toiletries (or $34 per week between herself and the child), as well as $45 for herself on entertainment (or $70 for herself and the child), and $25 per week by way of gifts (or $40 per week including the child’s expenses).
I am satisfied that the wife receives help from her father in the form of a free motor vehicle. She says that she pays all running costs except insurance which he meets, and he paid her first year’s registration.
Although the wife claimed that two trips to Queensland (in April and September 2009) were fully paid for by others, I was left with suspicions about that. In one instance she claimed that her sister met the expenses to enable an extended family holiday. In the other instance, she said a girl-friend paid the expenses, to thank her for stepping in to look after her child when she was unwell. Neither was called as a witness. This part of the evidence fortified me in the view that the wife has been earning other income that probably accounted for her capacity to travel.
The wife did not give any precise indication as to her anticipated earnings next year. She said she proposes to work within school hours five days’ per week. Although she was evidently highly regarded in her retail roles, she is hoping to change to administrative or secretarial work, and has already been invited to apply for a job at the child’s kindergarten.
The wife and the child currently live with the maternal grandmother. She says that she does want to live independently in due course. It is a reasonable expectation. Presently, according to her evidence, she pays her mother $25 per week by way of board, and contributes another $150 per week by way of food and household supplies, as well as $40 for her telephone. Her expenses will obviously increase if she lives independently.
As I have noted, no specific periodic sum was specified by the wife in her application for a departure order. In evidence she said that she “required” $229 per week, although she added that it was an alternative to the $220 spousal maintenance she sought. When asked how it was calculated, she said something to the effect that “If I’m not successful with spousal maintenance I would like it for [the child].” That of course is not in itself a basis to satisfy the test for a departure order.
In her latest financial statement, the wife claims the child’s expenses at $196 per week. That included $30 per week by way of educational expenses (next year and for the following four years to be met by the husband), and $30 per week by way of psychologist’s fees for the child, although I did not hear if such counselling was continuing, particularly in light of the parenting issues now being finalised. I emphasise that I cannot say it is not continuing. It means though that her claimed expenses for the child are between $136 and $166 per week.

The Husband’s Financial Position and His Income-Earning Capacity

The thrust of the wife’s case is that the husband is a well-qualified chartered accountant, with an MBA, and the capacity to earn a high income. Her case is that he has deliberately manipulated his affairs to effect a low income, that he has not worked at capacity, has not applied for appropriate jobs, and has put himself in a position whereby his income is deliberately insignificant, simply to avoid his obligations to her and/or the child. To that same end, he has “faked” the recent mental illness as described by his doctor and psychologist.
Some aspects of the evidence support a suspicion that the husband could have been working at a higher rate. Some aspects do not.
The wife points to the fact that the husband was employed at a large firm in the early part of his career. Since then he has been involved in the family business, helping to run two cafés, a hospitality business, and a distribution business, as well as conducting general accounting for them.
She points to his income in the 2003 and 2004 financial years at around $107,000, but she had to agree that it dropped significantly from the 2005 tax year to just under $50,000. She points to the fact that they had separated in the course of that financial year, and that later (in 2007) his employment with his family was purportedly terminated, again at a time when they had separated, and she was seeking a new child support assessment.
She refers to paragraphs 2(p) and 2(q) of the husband’s affidavit, filed 30 November 2007, where he said that he hoped to be able to gain an income of $100,000, but in light of his desire to care for his daughter half time, he was likely to earn $50,000. In fact, since that time, his income has dropped further so that in the 2007 financial year he had a taxable income of $49,904, in the 2008 his taxable income was $26,335 and for 2009 it was $18,376.

The wife emphasised that the income received by the husband at present is ludicrously low for a man with his qualifications, that he is capable of earning very substantially more than what is significantly less than even a first-year accountant would earn, and that he has made no efforts to pursue jobs that she says were available and appropriate to him, in line with advertisements annexed to her affidavits.
The wife is also disbelieving about the husband’s stated level of debt and resources. He owns his property at H valued at $965,000. He says he owes his parents $250,000. They have two caveats registered over the property to secure the two mortgages. The wife says that no monies have ever been re-paid or called upon and that he does not genuinely need to re-pay those sums.
There is a further mortgage over his property to NAB pursuant to the 2008 guarantee of $350,000-odd that he gave over substantial monies borrowed by his father, to complete the building of a large home in B. According to the husband, his father borrowed $3.2 million. The house is now on the market. It was passed in on a vendor’s bid at auction in the course of this hearing at $2,450,000. The reserve price was $2.6 million.
The wife is suspicious of the purported guarantee on the basis that it occurred at time when her spousal maintenance claim was on foot and she was told of it only on the day of the spousal maintenance hearing. She points to the fact too that if he had genuine debt to his parents, it was unlikely that he would have allowed his credit card debt to mount in the way that it has since separation.
The wife is also disbelieving of the husband’s claim that he receives no assistance from his current wife as he claims. She points to the fact that at paragraph 48 of his recent affidavit he swore that he and his wife planned to start a family. It was submitted for the wife that his parlous financial position did not ring true in light of that plan.
Most importantly, the wife submitted that I should not accept the evidence as to the husband’s mental health. It was pointed out that it too arose only on the day of the hearing and it was part of his on-going manipulation.
There are aspects of the husband’s conduct that have been clearly unimpressive. That was the case in relation to parts of his evidence as well. And it can be seen in the way that he conducted his case. He was given ample opportunity to call family members and his wife. I can be sympathetic to his assertion that he would not call his elderly mother who has been so recently widowed. However, he could have called his sister, the executrix of his father’s will, and it would have been appropriate to do so in light of his claims about monies he owes to his father’s estate, and the dire position of the family companies. He also could have called his current wife, and that would have been appropriate to deal with issues as to whether or not their financial affairs are intertwined in any way.
If a party fails to call an obvious witness, the court may infer that the witness would not have offered evidence to support the party’s case.
So far as his wife is concerned, she is self-employed. Her recent income tax return shows a taxable income of about $62,000. She owns a property that is rented out. She lives with him in his property. He says their financial affairs are completely separate. However, it seems that he pays all expenses in relation to the household in which they are living. He says that is because they have a “traditional marriage”.
That was an absurd suggestion in light of the fact that, to explain away their wedding for 88 people at a Club, followed by a honeymoon in the USA (combined in part with a work conference for his wife in Hawaii), he gave evidence that it was his wife who met the expenses. Similarly, he explained away her $7,000-odd engagement ring on the basis that she paid for it herself. These aspects are contrary to what one would generally understand as a “traditional marriage”. It seemed that the husband was picking and choosing his traditions.
I was unimpressed that he did not call his wife. I am left with the view that she is probably contributing to his household. I am not however going further, to suggest that she is obliged to support his daughter.
I perceived a strong element of pig-headedness in the husband’s decision not to call his sister. He should have done so. That said, financial records in relation to the husband and his income over the years, the mortgage to his parents, and the bank guarantee, have been trawled over at length by the wife’s legal representatives, or so it appears, from the wife’s affidavit. Despite sweeping allegations (to which I shall return), there was little substantiated to undermine the husband’s evidence. And there is no suggestion that the NAB guarantee is other than real. The evidence suggests it is probable that it will be called in by the bank.
There were aspects of the husband’s behaviour that lead me to conclude that he has been keen to thwart the wife in her claims against him at various times in various ways. For example, I note that upon separation, a car provided by the husband’s family business was promptly removed from her use, even though she depended upon it whilst caring for the parties’ small child.
The wife’s conduct too has been unimpressive in various respects in relation to these financial matters. I have already noted what I regard as her dishonesty in relation to paid work. I also note that she pursued the setting aside of the binding financial agreement, only to ultimately drop that. She apparently lodged a caveat over his property at one point, only to subsequently withdraw that. She pursued spousal maintenance until the third day of this hearing and then dropped that. And as I have noted, her affidavit was full of far-reaching assertions about his financial position, assertions that she could simply not sustain when tested.
By way of illustration, at paragraph 64 of her affidavit she said she was “somewhat unclear” how the husband’s income tax return and BAS statement tallied. When cross-examined about it, she was unable to support that assertion.
In paragraph 65 of her affidavit she purported to question the income tax returns of the husband’s new wife. When cross-examined about it, it was clear that she had no idea how the calculations in that paragraph were reached. She relied upon her solicitor.
In addition, she had attached to her affidavit various advertisements for jobs for which she said the husband was qualified but when cross-examined about them it was quite clear that she had little understanding of his experience and qualifications. A number of times in her cross-examination, when challenged about that or other assertions, she simply replied “I rely on what’s in my affidavit.”
Although the wife claims that the husband’s income used to be very substantially higher than now, it is important to note that since 2004 he has never earned more than $50,000. That covers periods when the parties were living together, as well as when they were separated. He did, in addition, have some expenses paid by the family business, such as telephone and internet accounts. His Foxtel account was also paid. I accept his evidence that, given their line of business, it was an obvious work expense, not just a luxury. He, and at times the wife, also had the use of cars supplied by the business. Working for a family business had some obvious benefits. It also took him outside other mainstream accounting employment.
In assessing the husband’s capacity for the sorts of corporate accounting jobs asserted by the wife as open to him, it is important to bear in mind that he has not worked as an accountant or external auditor for 20 years. That was during his stint at a large firm early in his career. Since then, until 2005, he was immersed in his family business. Except for basic accounting, his career has not taken him down a traditional CPA route.
The jobs chosen at random by the wife as appropriate for the husband were, on his account, not appropriate. I accept his evidence on that. However, even if the family business has come to a halt with very hard times as he claims, he could have sought other work. He has engaged only in part-time work. I accept that for a considerable period these parties were deeply entrenched in litigation – on all fronts – property, maintenance, child support, and fiercely contested children’s issues. I accept it was taking its toll on him (and no doubt her), and that he was dearly hoping to have shared care of his daughter, and to be available to care for her when she was with him. Indeed, until earlier this year, she was with him all day every Friday as well as every second week-end.
I am conscious that the parenting issues have been concluded. However, I cannot overlook them. I cannot overlook that a father who has been as attached to his daughter as the husband has obviously been, who has pursued his time with her consistently and earnestly during years of litigation, and who has shared a close relationship with her, has since the middle of this year simply “given up” pursing any time with her. That is, since the wife insisted on restrictions on his time, having raised allegations of physical violence towards the child by his new wife. It is an important element feeding into a consideration of the husband’s mental health in the course of this year, being the period during which the current child support assessment was made, and the arrears of spousal maintenance built.
Dr A is the husband’s general practitioner. He reported:
[The husband] has been attending me with severe anxiety depressive symptoms relation to lack of custody of his daughter. I referred him to [Ms P] psychologist who has been helping him.
He is due to attend court next Wednesday and I cannot see any reason why he is unable to have joint custody of his daughter.
His current mental state has made it very hard for him concentrate [sic] on his work capabilities and he has been unable to work to maximum financial capacity.
Hopefully if court issues can be in his favour he will become more productive.
Ms P is the psychologist to whom the husband was referred by Dr A. She first treated the husband in early 2006 when he was finding the first separation difficult. Upon Dr A’s referral she saw him again several times in October 2009. She reported:
[The husband] stated he was finding it difficult to work but was currently managing two days a week.
[The husband] was assessed with anxiety and a severe depression. Symptoms include feelings of helplessness, concentration difficulties, indecisiveness, sleeplessness and fatigue. It will take [the husband] some time to recover from the loss of his father; the financial strain he is under and the pressures of the family court issues, particularly as he finds not having regular contact with his daughter very difficult.
Mr Cantwell asked me effectively to find that the husband was faking his poor mental health. That is, I should reject the expert evidence, and should find there had been no impediment to the husband obtaining appropriately paid work in the course of this year. Mr Cantwell pointed to one particularly obvious feature, which was that the husband had been able to represent himself throughout these proceedings fully and well, with what appeared to be intense and sustained concentration and organisation. Nevertheless, I accept the evidence as to the husband’s poor mental health and incapacity for work, at least since earlier this year, first when the wife made the allegations, but secondly when his father died in June.
The husband was clearly very close to his father, with a loving family and long-term working relationship, which abruptly came to the end, within days of what should have been the happy time surrounding his wedding to his current wife.
The fact that the on-going fighting about the child has taken its toll on the husband is supported in two different ways. First, I do not believe he has simply made up his claim that he has been worn down by what he has perceived as a campaign of alienation against him by the mother. One small piece of evidence, mentioned in passing by her in the course of cross-examination, gave great insight into her attitude, and what he has no doubt endured. When the husband asked her why she had not sold her $7,500 engagement ring in order to obtain some funds, she said in a manner that I would describe as “cocky” words to the effect that:
I did a memorable thing. [The child] and I threw it into the sea at the beginning of this year.
That is, at a period shortly before the purported allegations were raised against the husband’s then fiancée, and despite the mother’s denials that she had alienated the child from her father, in the course of the financial proceedings she dropped her guard in response to that question, exposing the fact that she apparently saw nothing inappropriate in involving four- or five-year-old child in the “memorable” act that she described.
Secondly, that the husband has “given up” on seeing the child appears to be so at odds with how he has always conducted himself as a father. The most probable explanation is that he simply has not been and is not coping. The psychologist noted that he spoke much more with her about the arrangements for his daughter and his distress over that, than he did about financial matters.
The psychologist described the husband in late October 2009 as “disoriented” and somewhat “distressed”. When it was put to her that his meticulous cross-examination in this case of the wife showed no signs of disorientation, she said that his adrenal glands were probably getting him through, he was “fighting for his life” – for his position and his rights – and we were seeing him at his best. She said that she was not surprised he was handling himself well. He was very intelligent and he would be able to cope. However he has been through a very difficult time with a number or stressors. The previous years have been hard. He has not recovered from his grief and loss and he is battling and will continue to battle severe depression.
Ms P said she had no doubts or suspicions about the husband’s veracity. He impressed her as a genuine person, and there was no incongruencies presented to her. She was not suspicious that he saw her just weeks before this court hearing, saying that it was not uncommon for someone to seek assistance just before the stress of a court case.
Ms P recommended a slow integration for him back into the work place, starting with about two days per week which she described as “probably just about perfect”. Although she strongly denied that he had “manipulated” or “conned” her, she readily agreed that once the litigation was over, improvement in his condition could be expected. When it was put to her that he could work as an accountant, she said that he probably could work, but it was likely to put an enormous strain on him and she did not know if at this stage he could sustain it.
Mr Cantwell made much of the fact that the husband was not taking medication. I accept that Ms P could not recall if she had yet told Dr A that she was recommending medication. In the meantime she had recommended to the husband to undertake meditation and other strategies to help him cope.
Dr A saw the husband on 28 October 2009 and referred him to the psychologist that day. He has not yet seen him since and at this stage has not prescribed any medication. I accept the husband’s evidence that he plans to see Dr A after this case, and that he did not want to pursue medication before preparing and conducting this hearing. He was worried it might adversely affect his capacity.
Dr A spoke of the husband presenting as someone who could not concentrate or be motivated. When it was put to him that he was actively engaged in this difficult case, Dr A’s explanation was that he was obviously very focussed on the court proceedings, but to the detriment of coping with and focussing on other things.
Dr A readily conceded that after this case is over, the husband will hopefully be able to focus on other matters and, hopefully, should be able to work.
I am satisfied that the experts gave balanced evidence and their expert opinions in relation to the husband were not destroyed in cross-examination.
In summary, there are aspects of the husband’s conduct and evidence that raise an obvious suspicion that he has at various times in the past failed to maximise his earning potential. That said, I do not accept the wife’s evidence as to his actual earning capacity, in the sense that she ignores that he has been out of mainstream accounting for most of his career. Even so, it is likely that he could have earned more than he has been earning over recent years. It was too coincidental that his income took some dips at times pertinent to the marriage breakdown or litigation.
In any event, I am satisfied that, ironically, currently, and at least from the middle of this year, he has genuinely struggled to get on top of mounting depression. The stressors in his life have been real, with the profoundly difficult issues in terms of his relationship with his little daughter, and the sudden loss of his father. I accept the medical evidence that at least with the reduction of the stress of litigation, and the certainty this case will bring, he should be able to start getting back into the workforce in a meaningful way. How quickly that will occur, and the opportunities available to him, are uncertain at this point.
I have drawn the inference that he has more assistance from his current wife than he has expressed. But when considering resources available to him, I am not able to conclude that debts over his house are not real, particularly when it comes to the bank guarantee.
Overall, I am not satisfied that there should be a departure order for a specified periodic sum of child support. In applying the provisions of s 117(7B) of the Act, I cannot determine that the husband’s earning capacity is greater than reflected by his current income, or at least his income since June of this year. I have found that the wife has received payments for work at an undisclosed level, and that she herself is about to start more paid work. Although she claimed $229 per week, she lists the child’s expenses at less ($196 per week which included $30 for school fees she will not need to meet). The husband will now take responsibility for the child’s primary school fees.
I am not satisfied that the ground is made out. If it were, I am still not satisfied that an order would be proper or just and equitable, for those reasons in combination. There is an exception. I propose including the private health cover for the child as part of the departure order, in addition to the agreed educational expenses. I am satisfied that the husband can afford that. He has always paid it. Given his vague evidence on the topic, I am satisfied that he should and can continue to pay and that it is a proper and just and equitable payment.
Of course, the future administrative assessments will reflect any changes in the parties’ respective positions. In particular, an increase in his earnings – as anticipated – will be taken into account.

ARREARS OF MAINTENANCE

The spousal maintenance order was for $220 per week. The agreed arrears of $4,550 is equivalent to 20 weeks’ of arrears. Interestingly, that aligns with the time-frame of the husband’s father’s passing, and the depression about which I am satisfied from the expert evidence. I am satisfied that he has been genuinely unable, and is unable to pay the spousal maintenance. I am conscious that previously he offered to pay $50 per week. That was rejected by the wife. He will soon be meeting private school fees. I am satisfied in the circumstances that no arrears of maintenance should be paid.

THE ORDERS

The orders I propose are as follows:
(1)That arrears of the spousal maintenance fixed at $4,550 shall be and are hereby discharged, and the order for spousal maintenance made on 25 August 2008 is hereby dismissed.
(2)That there shall be a departure order from the administrative assessment of the Child Support Agency in relation to the child … born … February 2004 pursuant to s 117 of the Child Support (Assessment) Act so that in addition to any administrative assessment the husband shall pay:
(a) The child’s fees at S School from the start of her preparatory year (2010) to the end of Year 4; and
(b) The child’s private health insurance.
(3)That all other applications shall be dismissed and the case removed from the list of cases awaiting finalisation.
(4)That pursuant to the Family Law Rules this matter reasonably required the attendance of counsel.

I certify that the preceding eighty-nind (89) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Dessau

Associate:

Date: 18 December 2009

[2009] FamCA 1244

18 DECEMBER 2009

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