DESCAS & DESCAS
[2013] FMCAfam 69
•30 January 2013
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| DESCAS & DESCAS | [2013] FMCAfam 69 |
| FAMILY LAW – Property – application for property settlement – where wife claimed former matrimonial home was haunted – whether value of former matrimonial home affected by alleged haunting – credibility issues – where parties have one child – where child lives with the wife – whether the wife made a greater contribution by caring for child with a learning disability – whether child’s disability sufficiently established by evidence – whether disability to be considered as a factor under Family Law Act 1975 (Cth) s.75(2). PRACTICE AND PROCEDURE – Application to re-open case – where wife claims that the husband failed to make a full and frank disclosure of his superannuation interests. |
| Family Law Act 1975 (Cth), ss.75, 79 |
| Al-Sadikh & Al-Sadikh [2007] FamCA 716 Black & Kellner (1992) 15 Fam LR 343; FLC 92-287 CKC & RRC [2006] FamCA 1290; (2006) FLC 299 Erdem & Ozsoy [2012] FMCAfam 1323 Hickey & Hickey [2003] FamCA 395; (2003) 30 Fam LR 355; FLC 93-143 Jones v Dunkel (1959) 101 CLR 298 Keegan & Hart [2007] FamCA 111 Lachlan & Lachlan [2008] FamCA 455 Stanford v Stanford [2012] HCA 52 Williams v Williams (1985) 10 Fam LR 335; FLC 91-628 |
| Applicant: | MR DESCAS |
| Respondent: | MS DESCAS |
| File Number: | SYC 6968 of 2009 |
| Judgment of: | Scarlett FM |
| Hearing dates: | 19 & 20 May, 19 December 2011 |
| Date of Last Submission: | 19 December 2011 |
| Delivered at: | Sydney |
| Delivered on: | 30 January 2013 |
REPRESENTATION
| Counsel for the Applicant: | Mr Livingstone |
| Solicitors for the Applicant: | Alidenes & Company |
| Counsel for the Respondent: | Mr Jackson |
| Solicitors for the Respondent: | Doolan Wagner & Callaghan |
ORDERS
Within four (4) months from the date of these Orders, the following shall simultaneously occur:
(a)The Applicant Husband must transfer to the Respondent Wife all of his right title and interest in the property situate at and known as Property D in the State of New South Wales being the whole of the land contained in Certificate of Title Folio Identifier [omitted];
(b)The Husband and Wife must do all acts and things and sign all documents necessary at the Wife’s expense to cause to be discharged and refinanced into her sole name the mortgage secured against the title to the property at Property D aforesaid being registered mortgage number [omitted] to Westpac Banking Corporation and the Wife must indemnify and keep indemnified the Husband from all any obligation the Husband may have pursuant to the mortgage to Westpac Banking Corporation;
(c)The Wife must pay to the Husband by way of settlement of property the sum of $189,288.77.
In the event that the Wife defaults in making the payment to the Husband in accordance with Order (1)(c) within four (4) months of the date of these Orders, then the Husband and Wife must forthwith do all acts and things and sign all documents necessary so as to effect the sale of the property at Property D for the best price reasonably obtainable in the following manner:
(a)The Husband and Wife must do all things and sign all necessary documents to instruct a solicitor to act on the conveyance of the property at Property D within twenty-one (21) days of the date of the default;
(b)The Husband and Wife must do all things and sign all necessary documents to appoint a Real Estate Agent to conduct the sale of the property at Property D within twenty-one (21) days of the date of the default;
(c)The listing price for sale of the property at Property D shall be $750,000.00 unless otherwise agreed by the parties;
(d)In the event that the property at Property D is not sold within sixteen (16) weeks of the date that the property is listed for sale then the Husband and Wife must do all things and sign all necessary documents to sell the property at Property D by public auction;
(e)The reserve price for the sale by public auction of the property at Property D shall be as agreed between the Husband and Wife fourteen (14) days prior to the date that the property is auctioned or in default of such agreement the Husband and Wife shall do all things and sign all necessary documents to request the President of the Real Estate Institute of New South Wales to nominate a reserve price for the auction of the property at Property D and any cost associated with obtaining such nomination are to be paid equally by the parties;
(f)The Husband and Wife must do all things and sign all necessary documents to cause the Real Estate Agent to auction the property within six (6) weeks of the date referred to in Order (2)(d) above;
(g)The Husband and Wife must do all things and sign all necessary documents to instruct the Real Estate Agent to accept the reserve price in the event that a bid is made in this sum or a greater sum at the auction;
(h)In the event that the property at Property D is not sold on the first occasion that it is auctioned, then the Husband and Wife must do all things and sign all necessary documents to cause the Real Estate Agent to auction the property again every six (6) weeks until it is sold upon the same terms and conditions as stated in Orders (2)(d), (2)(e) and (2)(g) above;
(i)In the event that the bidding at the auctions does not reach the reserve price the Husband or Wife or such of them as attends the relevant auctions may negotiate with the highest bidders or any other interested person and effect a sale of the property at Property D at a price that is not more than five (5) per cent below the reserve price or at such other price as the parties agree in writing;
(j)The Husband and Wife must each co-operate in every way with the Real Estate Agent, including:
(i)Making the key available to the Real Estate Agent;
(ii)Allowing the inspection of the property at Property D at all reasonable times as requested by the Real Estate Agent;
(iii)By not saying or doing anything that is likely to hinder or prevent the sale being effected;
(iv)By ensuring that the property at Property D including the grounds is in a neat and clean condition at the time of inspection by the Real Estate Agent or prospective purchasers;
(v)Signing all documents requested by the Real Estate Agent in relation to the listing for sale of the property at Property D except a contract or agreement for sale that has not been authorised by the solicitor for the Husband and Wife acting in relation to the conveyance.
(k)The Husband and Wife must do all things and sign all necessary documents and provide all necessary authorities to cause the proceeds of sale of the property at Property D to be distributed in the following manner and priority:
(i)All costs and expenses of sale including legal costs and disbursements, Real Estate Agent’s commission, valuer’s fees and auction expenses, if any (including repayment of any such expense as has been paid by either or both of the parties);
(ii)The balance then remaining is to be divided as follows:
(A)as to 65% to the Wife; and
(B)as to 35% to the Husband.
Except as otherwise provided for in these Orders, each party shall be liable for and shall indemnify the other in respect of any liabilities in their respective names.
Each party is to retain any superannuation interests in his or her own name.
Each party is to retain any bank account standing in his or her own name.
The Wife is to retain and is solely entitled to the Toyota Corolla motor car registered number [omitted].
Each party is to be solely responsible for any credit card debt standing in his or her name and shall indemnify the other party against all or any claims arising from such debt.
Written submissions in support of any application for costs are to be filed and served within 21 days and written submissions in opposition to any such application are to be filed and served within a further period of 14 days.
IT IS NOTED that publication of this judgment under the pseudonym Descas & Descas is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYC 6968 of 2009
| MR DESCAS |
Applicant
And
| MS DESCAS |
Respondent
REASONS FOR JUDGMENT
Application
This is an Application for property orders by the husband arising out of cohabitation and marriage of 18 or 19 years’ duration. It is the Husband’s case that, whilst the parties’ contributions should be assessed as equal, there should be an adjustment in his favour under s.75(2) of the Family Law Act because of the gravity of his health. He submits that an adjustment of 10% should be made in his favour.
It is the wife’s case that orders should be made that:
a)The Husband should transfer his interest in the former matrimonial home at [D], New South Wales, to her;
b)The parties should do all things necessary to discharge the mortgage secured over the former matrimonial so that the Wife may refinance the mortgage over the property into her sole name; and
c)The Wife should pay the Husband the sum of $150,000.00 by way of settlement of property.
The proceedings were conducted over a period of two days in May 2011. However, there was an application by the wife to re-open the proceedings based on a claim that the Husband had failed to disclose certain assets. Further evidence was taken and further submissions were made on 19th December 2011.
Background
The Husband was born [in] 1959. The Wife was born [in] 1960.
The parties started living together in 1990, according to the Wife, or 1991, according to the Husband. They were married [in] 1996.
There is one child of the marriage, [X], who was born [in] 1997. She lives with the Mother and has had little contact with the Father since the parties separated.
It is not in dispute that the Husband was hospitalised and diagnosed with schizophrenia in 2002.[1]
[1] Affidavit of Mr Descas 5.7.2010 at paragraph [21]; affidavit of Ms Descas 24.4.2010 at paragraph [15]
The Wife obtained an Apprehended Violence Order against the Husband in 2007 after having complained to the Police about the Husband’s behaviour. She deposed that the Protected persons were herself and the parties’ daughter.[2] A copy of the Order was not annexed to her affidavit.
[2] Affidavit of Ms Descas 24.5.2010 at [18]
The parties separated in October 2009. The Wife deposed in her affidavit of 24th May 2010 that they separated on 9th October 2009.[3]
[3] Ibid at [20]
On 9th October 2009 the Local Court of New South Wales at [omitted] made a final Apprehended Domestic Violence Order against the Husband. That order was in force for a period of two years. The Protected Persons named in the Order were the Wife and the parties’ daughter, [X].
As well as the standard Orders, the Apprehended Domestic Violence Order provided that:
2. The defendant must not reside at the premises at which the protected person(s) may from time to time reside, or other specified premises: Home Property D, NSW 2203
The Wife and the parties’ daughter continue to live in the home at [D]. The Husband has lived with his mother since the date of separation.
The parties are not divorced. The Court records show that the Husband filed an Application for Divorce on 17th November 2009 in which he claimed that the parties had separated in 1999 but had remained living under the one roof until October 2009.
The Wife’s solicitors wrote to the Husband’s solicitors on 2nd December 2009, disputing the Husband’s claim as to the date of separation. The Husband filed a Notice of Discontinuance on 18th December 2009.
The Applicant commenced these proceedings by filing an Application and supporting documents on 23rd April 2010. In the Application, he sought orders:
a)for the sale of the home in Property D, [D], with the net proceeds being divided as to 45% to the Wife and 55% to himself;
b)the Wife to retain all the household furniture and the bed ensemble, both of which were to go to the Husband;
c)the parties to retain their individual superannuation entitlements; and
d)the parties to retain all other property standing in their own name or possession.
The Application was returnable on 9th June 2010.
The Wife filed her Response 25th May 2010. In her Response, the Wife sought orders that:
a)the Husband should transfer to the Wife all of his interest in the home at Property D, [D];
b)the parties should discharge the mortgage over the home so that the Wife could refinance the property by a mortgage in her own name;
c)the Wife should retain all personal property in her name or possession; and
d)the Husband should retain all personal property in his name or possession.
On 21st April 2010 the parties were directed to attend a Conciliation Conference before a Registrar. The parties attended the Conciliation Conference on 13th August 2010 but no resolution was reached.
The Application was listed for Hearing on 19th and 20th May 2011.
Evidence
The Husband relied on the following:
a)his Financial Statement filed on 23rd April 2010;
b)his affidavit of 5th July 2010;
c)his affidavit of 16th May 2011;
d)the affidavit of Mr P of 28th April 2011; and
e)the affidavit of his mother, Ms D, of 16th May 2011.
The Husband and his mother gave oral evidence and were cross-examined by Mr Jackson of counsel, who appeared for the Wife.
It was the Husband’s evidence that when the parties commenced living together he was working as a [omitted] during the day for five days a week, but he also had a second job as a [omitted], working for three or five nights a week. He would hand his pay packet to the Wife each week and she would give him approximately $20.00 per week for his travel expenses. The Wife attended to the payment of household and other expenses. She also worked but he deposed that he did not know what she did with the money that she earned.
The Wife had approximately $50,000.00 in savings at the commencement of the parties’ relationship.
The Husband deposed that at the commencement of the relationship he owned a motor vehicle and some personal effects. He stated that he sold the car for approximately $12,000.00 and gave the proceeds to the Wife shortly after their daughter [X] was born.
The parties purchased the home at [D] in about 1996 for $250,000.00. The Husband deposes that the purchase price was made up by:
a)the Wife’s savings of approximately $50,000.00;
b)$25,000.00 from his mother;
c)$25,000.00 from the Wife’s mother; and
d)the balance was borrowed from a bank.[4]
[4] Affidavit of Mr Descas 5.7.2010 at [12]
The Husband deposed that the Wife’s mother moved in to live with them after [X] was born. He claimed that the Wife and her mother used to have violent arguments in which the Wife would “throw kitchen pans and plates and sometimes food at her mother”.[5] He denied that he was ever violent towards the Wife and said that he consented to the Apprehended Violence Order in 2007 without admissions because the stress of the court case was very bad for his schizophrenia.
[5] Ibid at [14]
The Husband deposed that after he was diagnosed with schizophrenia he was very heavily medicated and it was difficult for him to maintain his employment. He claimed that the Wife did not provide him with any money for cigarettes and he was required to ask his mother or her partner for money.
The Husband stated that in 2004 he was provided with a Mobility Allowance from Centrelink of approximately $60.00 per fortnight. He deposed that on 14th April 2008 the Centrelink payments were diverted into an account in the name of “[Ms Descas] in trust for [X]” without his knowledge or consent.[6] He annexed to his affidavit a copy of a bank statement showing that the account had a balance of approximately $3,000.00 in April 2009 but the funds were withdrawn shortly after that date. The statement, dated 6/11/2009, also shows that on 6th October 2009 the account had an opening balance of $318.68. There were deposits of $158.60 made during the month and the sum of $300.00 was withdrawn, leaving a closing balance of $177.28.[7]
[6] Ibid at [25], [28]
[7] Affidavit of Mr Descas 5.7.2010 Annexure “C”
The Husband stated that he tried to go off his medication in about 2007 and obtained employment at [C] six days a week as a [omitted]. He also obtained part time employment at a hospitality company.
However, the Husband went on sick or stress leave from the [C] on 1st December 2009 and at the date of his affidavit he was receiving the sum of $500.00 per week from his superannuation income protection policy.
The Husband deposed that he is in poor health. Annexed to his affidavit is a certificate from his medical practitioner, Dr B, stating that the Husband suffers from asthma, diabetes mellitus and schizophrenia and requires a number of medications on a regular basis.[8]
[8] Ibid Annexure “D”
In his later affidavit, the Husband deposed that his situation had remained unchanged. In particular, he is still on prescribed medication for his schizophrenia, which has the effect of making him feel drowsy and nauseous. He has tried to find alternative employment “but it has lasted only a few hours because of my anxiety and feelings of drowsiness”.[9]
[9] Affidavit of Mr Descas 16.5.2011 at [8]
In a bizarre twist, the Husband described how the parties had agreed to appoint a valuer, Mr P, to prepare a joint valuation of the former matrimonial home. He deposed that the Wife told him that she thought the house was haunted. When he asked her:
“That is the most ridiculous thing I ever heard. Why do you want to stay there then?”
she replied:
“I’m staying in that house whatever it takes”.[10]
[10] Affidavit of Mr Descas 16.5.2011 at [31]
In cross-examination by Mr Jackson, the Husband agreed with the statements he made in his affidavit of 12th November 2009, filed in connection with his Application for Divorce, that he considered the marriage to be over when he moved out of the master bedroom in 1999. He agreed that he had moved out of the house in October 2009.
The Husband affirmed the truth of the statement made in paragraph 5 of his affidavit:
[X] has learning difficulties and other disabilities that caused her to become very distressed if Ms Descas showed any affection to one another. [X] would scream and cry loudly and become very upset.[11]
[11] Affidavit of Mr Descas 12.1.2009 at paragraph [5]
Sadly, the Husband said that he had not seen his daughter for nearly two years.
The Husband told the Court that at times it was hard for him to understand things because he “didn’t go to school very much”. On a number of occasions he said that he did not remember things because it was too long ago.
The Husband also said that he had tried to go off his medication when he thought he could cope, but he found that he could not. He corrected the statement in paragraph [32] of his affidavit of 5 July 2010. He said that he was not on sick leave from [C], but stress leave.
He was asked about his gambling, but he said that he “didn’t go that much” and he only gambled “a little bit”. He said he would gamble only about once a month. He went on to say that he did not gamble at all once he and his wife bought the house. He said he did not know how much he had spent on poker machines.
I found the Husband’s evidence on the issue of gambling unconvincing.
The Husband’s mother, Ms D, deposed in her affidavit of 16th May 2011 that her son had lived with her since separating from his wife. She confirmed that he suffered from schizophrenia.
It was the mother’s evidence that the Wife had often lost her temper at the Husband and she had seen scratches on his arms that he said had been inflicted on him by his wife.
The Husband annexed a copy of a letter from the Wife’s solicitors to the valuer dated 22nd November 2010, in which they pointed out a number of drawbacks to do with the house, including:
Whilst we understand the difficulties present with same, our client has specifically instructed us to include in these questions, her belief that the property is haunted (which we are instructed the husband is already very aware of)
Would you please advise whether any of the above affects the value of the property.[12]
[12] Affidavit of Mr Descas 16.5.2011 Annexure “B”
The valuer appeared to be rather amused by this request, and said in his reply dated 23rd November 2010:
Exorcism is not one of our many speciality services and unless the ghost was held captive in the room top which we could not gain access it must have been at lunch.[13]
[13] Ibid Annexure “E”
The Mother also deposed that she had given money to her daughter in law when she asked:
I recall giving Ms Descas sums of money up to $500 in cash on at least 10 occasions.[14]
[14] Affidavit of Ms D 16.5.2011 at paragraph [9]
The Mother also stated that her son would continue to live with her for the foreseeable future. She stated that he paid her $100.00 per week for board.
In cross-examination, the Mother corrected her evidence in her affidavit, saying that her son actually paid her $250.00 per week, of which $150.00 is for rent and $100.00 for food.
Mr P was not required for cross-examination. He is a registered valuer who prepared a valuation of the former matrimonial home as a jointly appointed Court expert. In his valuation he expressed the opinion that the current market value of the property in fee simple at $750,000.00.
The Wife relied on the following:
a)her affidavit sworn 29th April 2011; and
b)her financial statement sworn and filed on 29th April 2011.
It is the Wife’s evidence that the parties’ daughter has a moderate intellectual disability and is very dependent on her.
The Wife deposed that when she and the Husband commenced their relationship he had just separated from his first wife and had no assets. She claimed:
From the time that we began living together I became aware that [Mr Descas] was not accumulating savings from his income but rather was gambling all of his income. He did not initially contribute to the rent or our costs including any food and bills.[15]
[15] Affidavit of Ms Descas 29.4.2011 at paragraph [9]
She claimed that she attended to all the household tasks and the Husband did not contribute to the maintenance of the home or to the care of their daughter [X]. She stated that she cared for [X] with the assistance of her mother.
The Wife in her affidavit downplayed the Husband’s financial contribution to the household, stating that until a date in 1996 he was gambling most of his wages, to the extent of several hundred dollars a week. Once they purchased the former matrimonial home, he started contributing $400.00 per week to the household. She deposed:
[Mr Descas]’s employer had changed their pay policies and his money was being deposited into his account which was somewhat of a relief for me. [Mr Descas] then gave me his key card so he couldn’t spend the money he was earning on gambling and I could manage all of our finances effectively.[16]
[16] Ibid at [16]
The Wife claimed that the Husband continued gambling when he had the money to do so.
The Wife deposed that in 1998 she received an award of $30,000.00 as compensation for injuries she had received in a motor accident:
It was paid to me because of a permanent disability and impairment I suffered in my right knee. I paid that money partly in reduction of the mortgage and also to effect improvements to the former matrimonial home…[17]
[17] Affidavit of Ms Descas 29.4.2011 at [19]
The Wife deposed that she and the Husband purchased an investment property at [D] in about 2004 at a purchase price of approximately $285,000.00. The property was rented out at approximately $250.00 per week. She claims that she also contributed approximately $1,000.00 per month towards the mortgage and other expenses on the investment property, without any assistance from the Husband.
The property was sold in January 2008 for approximately $330,000.00. She deposed that:
All of the sale proceeds (approximately $15,000) were applied to outstanding debts (such as outstanding household bills and credit cards) [Mr Descas] and I had accumulated over a period of about 4 years whilst [Mr Descas] was working only sporadically.[18]
[18] Ibid at [20]
The Wife claimed that:
In mid 2009 [Mr Descas] borrowed $10,000 without my knowledge and consent. These monies were spent unilaterally by him on gambling and prositiutes.[19]
[19] Ibid [27]
The Wife claims that the Husband spends only limited time with their daughter [X], and that time only at the child’s request. It is her evidence that the child is not coping well at school and has a special needs teacher because of her learning difficulties. The Wife arranged for [X] to attend on a psychologist for counselling for an hour a month, which appears to be assisting her. She also saw a psychologist at her school about every three weeks.
The Wife deposes that [X] does not cope with change at all well and has expressed fear as to what will happen if they have to leave the former matrimonial home. The child also has a cat with which she has a close bond and has expressed concern as to what would happen to the cat if they had to move out of the former matrimonial home into a home unit.
The Wife also deposes that she and her mother have to provide considerable assistance to the child, more so than for most children of her age. She deposed at paragraphs [66] and [67] of her affidavit:
I am concerned that [X]’s special needs will continue to grow. The ongoing independent assessments that have been periodically undertaken of her have identified a growing difference between her and what would be regarded as average behaviour. [X] is now classified as moderately intellectually disabled. I do not expect that she will complete High School and do not believe that she will be able to undertake work thereafter. If [X] does obtain some form of employment in the future it will have to be something in an area which does not require any (very) significant skill perhaps something like beauty therapy including massage etc. She is able to use a computer but only has very basic skills.
I have found it harder and harder to manage her needs and behaviour as she is maturing. Instead of becoming more independent [X] is become[20] needier. I don’t believe she will be able to drive a car safely given her “blindness” when crossing the road or taking instructions and generally observing things that are going on around her. She does not have a very good attention span and forgets things very easily.[21]
[20] sic
[21] Affidavit of Ms Descas 29.4.2011 at [66]-[67]
The Wife deposed that she had consulted a psychiatrist as a result of suffering from depression. She sees him every six weeks. He has prescribed anti-depressant medication for her.
The Wife was cross-examined by Mr Livingstone of counsel for the Husband. It was put to her that her evidence in paragraph [29] of her affidavit and in her Financial Statement that the husband only paid her $7.00 per week by way of child support was not true. Mr Livingstone suggested that the Husband was paying closer to $100.00 per week by way of child support.
The Wife agreed that the figure of $7.00 per week was incorrect, saying that she told this to her solicitor who corrected the figure to $15.00 per week. She then said that she received $15.00 by way of ongoing child support but the balance was for arrears.
Counsel for the Husband called for the correspondence correcting that statement but the call was unable to be met.
I found the Wife’s evidence to be highly unsatisfactory on this point and I formed the impression that she was not being truthful.
The Wife also maintained her position that the house was haunted by a ghost, saying that a lot of people in her street knew that the house was haunted. She said in cross-examination the next day that years after they moved into the house she “felt something” in one room. She claimed that her nephew actually saw the ghost some years ago. The haunting was confined to one room only, surprisingly enough, the room in which she currently sleeps. She said she did not feel the presence of the ghost.
The Wife’s mother lives with her in the former matrimonial home. She did not provide an affidavit.
I found this account of the alleged haunting to be unbelievable and I am satisfied that the claim was fabricated for an ulterior purpose, namely, as an attempt to influence the valuer to return a low valuation of the former matrimonial home.
These instances, and several others over the two hearing days, led me to the view that the Wife was not a very credible witness.
The Wife’s case was always that she should retain the former matrimonial home. She said that the sum of $150,000.00 was the most she could afford to pay to pay out her husband. When asked what she would do if it was ordered that she should pay a greater amount if she wished to retain the former matrimonial home she replied that she had not thought about that possibility.
Application to Re-open
On 25th May 2011 the Wife’s solicitors applied to the Court to re-list the proceedings because it had come to their attention that there were further superannuation interests belonging to the husband that he had not disclosed at the hearing.
The Wife relied on two affidavits in support of her claim that the Husband had filed to make full and frank disclosure of his superannuation interests:
a)her affidavit of 22nd July 2011; and
b)her affidavit of 28th October 2011.
The Husband deposed to an affidavit on 27th July 2011.
On 19th December 2011 the Court heard further evidence going to that issue. The Wife was not required for cross-examination.
The Husband gave oral evidence and was cross-examined by
Mr Jackson of counsel, for the Wife.
It was the Wife’s evidence that on the evening of 19th May 2011, the day the Husband had given oral evidence, she located one of the Husband’s old [A] Super superannuation statements amongst her paperwork. Her lawyers drew this to the Husband’s legal advisers the following day. They did not seek to recall the Husband for cross-examination on that day.
The Wife deposed that on 23rd May 2011 she asked her solicitors to make enquiries as to the Husband’s superannuation interests and in particular his interest in [A] Super.
Annexed to the Wife’s affidavit of 22nd July 2011 are letters from [A] Super, [H] and [C] Superannuation, dated 20th June, 28th June and 15th July 2011, respectively. A convenient summary of the contents of those three letters can be found at paragraph [18] of the affidavit:
[Mr Descas]’s three separate superannuation interests therefore appear to be as follows:
a. [C] (as at 15 July 2011) $11,353.95
b. [H] (as at 28 June 2011) $1,767.27
c. [A] Super (as at 20 June 2011) $36,204.29
TOTAL $49,325.51
In her affidavit of 28th October 2011, the Wife denied that she opened of the Husband’s mail that arrived at the house after he moved out or that she had retained any of his mail without providing it to him. She described in great detail how she had provided the Husband’s mail to him.
The Wife also compares the balances in the Husband’s interests in [C] Superannuation as shown on his statements of 31st December 2008 and 30th June 2009 with the balance as at 15th July 2011, which appears to be “close to double the balance held in this particular fund as at 30 June 2009.” She speculates that:
I do not know how [Mr Descas]’s interest in this particular fund could have risen to this value of he was not working.[22]
[22] Affidavit of Ms Descas 28.10.2011 at paragraph [22]
The Husband deposed in his affidavit of 27th July 2011 that in the preparation of his Financial Statements sworn 22nd April 2010 and 21st April 2011 he relied upon documents that he had in his possession at the time. He claimed that the Wife did not pass his mail on to him and said that he never gave her permission to open his mail or retain his superannuation statements or other documents.
The Husband annexed to his affidavit letters from [A] Super, [C] and [H] dated 15th July 2011, 18th July 2011 and 28th June 2011, setting out the relevant balances.
The balances differ slightly from those in the statements annexed to the Wife’s affidavit. They are as follows (in the same order as in [77] above:
a)[C] (as at 18 July 2011) $11,310.94
b)[H] (as at 28 June 2011) $1,767.27[23]
c)[A] Super (as at 15 July 2011) $36,632.70
[23] This is the same letter sent by [H] to the wife’s solicitor
TOTAL $49,710.91
In cross-examination, the Husband said that he was “not good with dates” and had not been to the home for two years. He said that he had not been aware of the [H] Superannuation statement and reiterated his claim that all correspondence went to the home and was not passed on to him.
The Husband had great difficulty in giving evidence, saying that he was not feeling well. He said he did not remember why his interest in [A] Superannuation was not disclosed to the Court. He did not know about the value of his interest in [H]. He could not explain why the value the value of his interest in [C] Superannuation appeared to have doubled. He said he did not remember as “it’s been too long now”.
The Husband’s evidence was vague and highly unsatisfactory. I am not persuaded that he was deliberately lying to the Court or that he deliberately sought to withhold information about his financial situation. I accept that the Husband is not, in his counsel’s description, “a sophisticated gentleman”. There is evidence that he is a man who did not have a significant secondary education and he has had mental health issues for ten or more years. This has involved him in taking prescribed medication which has had various side effects. However, when he has gone off the medication he has suffered setbacks with a return of various symptoms.
In my view, the Husband was doing the best that he could, accepting the limitations of his lack of education and mental health history.
Submissions
As to the fresh evidence, Mr Livingstone submitted that the situation had not changed to any great extent.
He maintained that the wife appeared to have had access to the Husband’s mail.
Significantly, he submitted that it was not put to the Husband that he had wilfully or deliberately withheld the information about the value of his superannuation. Further, if the Wife’s solicitors had the slightest doubts about whether or not the Husband was working, they could have subpoenaed that evidence from his superannuation provides but did not do so.
It was further submitted that the Wife and her mother continue to live rent-free in the former matrimonial home. This can be seen as a post-separation contribution by the Husband, who is living elsewhere and paying rent and board.
In respect of this further issue, Mr Jackson of counsel submitted for the Wife that, whilst she is still living in the former matrimonial home, she is the one making the mortgage payments.
There was a non-disclosure by the Husband of the value of his superannuation entitlements. Whether it was wilful or accidental is irrelevant.
As to the overall situation, Mr Livingstone submitted for the Husband that the Court should have some scepticism about the Wife’s claims as to her liabilities, particularly an amount of $8.847.00 claimed to owing to the Westpac Bank for her Visa Card and a claimed loan of $8,000.00 from her mother. The latter was particularly unsatisfactory, he submitted, as:
·The Wife’s mother was not called to give any evidence of the loan, although she was unavailable
·There was no written evidence of the loan
·The Wife gives no evidence in her trial affidavit as to when the loan was made, when it is due to be repaid, or whether it was to be offset by the fact that the Wife’s mother had lived with the parties until separation and then with the wife after separation.
It was submitted as to contributions that any slight disparity in favour of the Wife would be offset by:
a)The Wife’s travels overseas without the Husband and at unknown cost; and
b)The Wife’s mother’s subsidised living arrangements for most of the marriage.
Mr Livingstone submitted that the evidence showed that the Husband worked hard, as did the Wife. The Husband was permitted very small amounts of money and the Wife was financially controlling.
The submission is that the child [X]’s difficulties in learning were not such as to render the wife’s contributions more onerous than would otherwise have been the case. A disability affecting a child only renders a contribution special in extreme cases, see Al-Sadikh & Al-Sadikh[24] at [45], where the Wife had claimed a special contribution in relation to caring for one of the parties’ children, who was diagnosed with muscular dystrophy at five years of age and died at sixteen years of age.
[24] [2007] FamCA 716
Otherwise, it was submitted that the contributions except for the Wife’s mother were close to equal. The Wife’s mother has been subsidised to a considerable degree over a period of 13 years, by living in the former matrimonial home. The Court was referred to the factually similar case of Lachlan & Lachlan[25], and to the approach taken by Le Poer Trench J. His Honour found in that case at [733]:
The Mother’s mother lived with the parties from 1991 to 2004. The Father says that although she received a pension she saved that money to fund overseas travel. The Father’s evidence, which I accept, is that the expenses of the Mother’s mother were met by the parties. The parties had sponsored the Mother’s mother to come to Australia. After about two years she received a pension. She contributed nothing from her pension to the family expenses. The parties provided her with a home and met all her expenses. I do not accept she provided any meaningful assistance to the parties for the care of the child or in any other way. There is no ability to consider this matter under the “contribution” headings having regard to the provisions of sections 79(4)(a), (b) and (c). This factor requires a significant adjustment in favour of the father.[26]
[25] [2008] FamCA 455
[26] [2008] FamCA 455 at [733]
It was also submitted that since the parties separated the Husband had paid child support and the Wife has continued to derive benefits from the parties’ joint and substantial equity in the home.
Mr Livingstone submitted that the s.75(2) factors favoured the Husband, in that his psychiatric disability deprives him of the capacity to obtain employment. He referred the Court to the decision of the Full Court of the Family Court in CKC & RRC[27], where Kay, Warnick and May JJ held at [32]:
…in so far as earning capacity of a party is a relevant s 75(2) factor, it is concept comprised of two aspects:
· capabilities and/or qualifications possess by the party; and
· the availability of opportunity to exercise those capacities in the workforce, for predictable reward, at least within a range.[28]
[27] [2006] FamCA 1290 (also reported as Causero and Causero (2006) FLC 93-299
[28] (2006) FLC 92-299 at [32]
It was submitted that there are opportunities for the Husband to work but he lacks the capability to do so.
It was submitted on behalf of the Husband that the Wife has not established a case that the parties’ child [X] will never work, is severely disabled or will be dependent on anyone as an adult. The Husband is paying child support in a greater amount than the Wife has repeatedly claimed on affidavit.
Mr Livingstone referred the Court to the decision of Bryant CJ in Keegan & Hart[29], where an adjustment of 5% was made in favour of the Wife, who had the care of a child with a proven diagnosis of cystic fibrosis.[30]
[29] [2007] FamCA 111
[30] [2007] FamCA 111 at [65]-[66]
It was submitted by Mr Jackson of counsel that the failure of the Husband to disclose his superannuation entitlement resulted in an increase of nearly $10,000.00 in the asset pool. The Husband had failed to make full and frank disclosure and the Court should have regard to the decision in Black & Kellner[31]. A party who fails to make full and frank financial disclosure cannot rely on the absence of evidence to prevent the making of orders.
[31] (1992) 15 Fam LR 343; FLC 92-287
It was submitted that the evidence of the Husband’s non-disclosure strengthened the Wife’s case. Her evidence should be preferred over that of the husband.
The Proper Approach to Determination of a Property Application
The way a court approaches property matters has been authoritatively set out by the Full court of the Family Court in its decision of Hickey & Hickey[32] where Nicholson CJ, Ellis and O’Ryan JJ held at [39]:
The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of s. 79. That approach involves four inter-related steps. Firstly, the Court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing. Secondly, the Court should identify and assess the contributions of the parties within the meaning of ss. 79(4)(a),(b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Thirdly, the Court should identify and assess the relevant matters referred to in ss. 79(4)(d), (e), (f) and (g), (the “other factors”) including, because of s. 79(4)(e), the matters referred to in s. 75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two. Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case…
[32] [2003] FamCA 395; (2003) 30 Fam LR 355; FLC 93-143
The Court should also have regard to the recent decision of the High Court of Australia in Stanford v Stanford[33], where the majority held that:
…the requirements of s. 79(2) and s. 79(4) are not to be conflated. In every case in which a property settlement under section 79 is sought, it is necessary to satisfy the court that, in all the circumstances, it is just and equitable to make the order.
[33] [2012] HCA 52
It is not a power to be exercised accorded to an unguided judicial discretion. It must be exercised in accordance with legal principles, including those appearing within the Family Law Act itself.[34]
[34] See Erdem & Ozsoy [2012] FMCAfam 1323 per Walters FM (as he then was) at [113]
The Parties’ Property and Liabilities
Counsel for the Husband has raised some scepticism about the debts claimed by the Wife. She sets out in her Financial Statement filed on 29th April 2011 credit card debts of approximately $8,847.00 owing to Westpac Visa and approximately $4,961.00 owing to American Express. There is evidence that credit cards were constantly in use and I am not of the view that either of these debts is unexplained or unusual.
The debt claimed to be owing to the Wife’s mother, Ms K, in the amount of $8,000.00, is another matter. There is no explanation of it in the Wife’s affidavit of 29th April 2011. The Wife has not tendered any document by way of a loan agreement in support of her claim. It is noteworthy that the Wife’s mother has not deposed to an affidavit setting out the fact of the loan and the terms of the loan. There is no explanation as to why the Wife’s mother has not given evidence. She lives in the former matrimonial home with the Wife and [X], so it would presumably have been a matter of little difficulty for her to swear an affidavit in support of the Wife’s case.
In my view, the failure by the Wife to provide evidence from her mother, without explanation, leads to the inference set out by the High Court in Jones v Dunkel[35], that is, that the evidence of the Wife’s mother would not take the Wife’s case any further.
[35] (1959) 101 CLR 298
In the circumstances, I am not satisfied that there is evidence to support the Wife’s claim that she owes her mother the sum of $8,000.00.
The Husband claims an amount of $9,732.00 in his Financial Statement of 27th April 2011, for “Unpaid Legal Fees and Loan from mother”. The claim has not been particularised. The Husband’s mother makes no mention of this loan in her affidavit. In the circumstances, I am not satisfied that there is evidence to support this claim.
One matter that needs to be taken into account is the matter of the Husband’s superannuation interests. Clearly, he did not make a full and frank disclosure, and whether or not that was deliberate or accidental is of no consequence in ascertaining the asset pool.
There are two slightly different totals for superannuation. The Wife’s figures are derived from information obtained nearer to the hearing dates in May 2011 and I believe that they should be used for the purpose of calculating the asset pool.
I find the non-superannuation asset pool to be:
a)Property D, [D] $750,000.00
b)Husband’s Household contents $10,000.00
c)Wife’s Westpac Account No. [omitted] $Nominal
d)Wife’s ANZ account for [X] $Nominal
e)Wife’s 2004 Toyota Corolla [omitted] $4,000.00
Total non-superannuation assets $764,000.00
I find the parties’ liabilities to be the following:
a)Mortgage on Property D, [D] $150,000.00
b)Wife’s Westpac Visa $8,847.00
c)Wife’s Amex $4,961.00
Total liabilities $163,814.00
The net value of the non-superannuation asset pool stands at $600,186.00.
Both parties have superannuation.
The Wife’s superannuation is agreed by the parties at $60,815.00.
The Husband’s superannuation, whilst greater than he originally claimed, is still only a modest amount. The superannuation balances[36] are:
a)[C] (as at 15 July 2011) $11,353.95
b)[H] (as at 28 June 2011) $1,767.27
c)[A] Super (as at 20 June 2011) $36,204.29
Total $49,325.51
[36] Taken from the wife’s affidavit of 22.7.2011 at [18]
The total of the parties’ superannuation stands at $110,140.51.
The net total, combining the net non-superannuation asset pool and the superannuation pool, amounts to $710, 326.51.
The Parties’ Contributions
In my view, the contributions favour the Wife. The Wife brought an amount of savings of $50,000.00, whilst the Husband had a car that was sold for $12,000.00 and some personal effects.
The evidence clearly shows that the Wife worked throughout the marriage, except for leave when the child [X] was born. She earned more than the Husband did and she was the one who managed the family finances. The Husband’s employment was sporadic once he was diagnosed with schizophrenia in 2002 and it appears that the Wife was the major financial provider from at least 2002 onwards.
The Wife received a damages award in 1998 in the sum of $30,000.00 arising from injuries she sustained in a motor accident. Her evidence is that this money was applied towards the mortgage and improvements to the home. In my view, this should be regarded as a contribution by the Wife (see Williams v Williams[37]).
[37] 10 Fam LR 356; FLC 91-628
I am not satisfied that the fact that the Wife was the primary carer for the child [X] during the period of cohabitation should lead to any weighting in her favour because of the child’s learning difficulties and other problems. It is certainly the case that the Husband deposed in his affidavit of 12th November 2009 that “[X] has learning difficulties and other disabilities”[38] but the Wife has not provided any psychological or medical evidence to support her claim. The Wife has had the assistance of her mother in the care of the child.
[38] Affidavit of Mr Descas 12.11.2009 at [5]
It is the case that the Wife has had the benefit of living in the former matrimonial home since the parties separated three years ago, but she has been paying the mortgage and has been the one who has made a contribution to the welfare of the child by continuing to act as her primary carer over that time.
I have also considered the Husband’s submission that the parties were effectively subsidising the Wife’s mother, who still lives in the former matrimonial home.
Taking all these matters into account, I am still of the view that the contributions slightly favour the wife.
I assess the parties’ contributions at 55% to the wife and 45% to the Husband.
Other Factors taken into Account under Subsection 79(4)(d) to (g)
Paragraph (d) of subsection 79(4) requires the Court to take into account to take into account the effect of any proposed order on the earning capacity of either party. There will be no effect on the earning capacity of either party.
Paragraph (e) of subsection 79(4) requires the court to take into account the matters referred to in subsection 75(2) so far as they are relevant.
The Husband was born [in] 1959. He is 53 years of age. He is not in good health, having been diagnosed with schizophrenia in 2002. He also suffers from asthma and diabetes. His health is such that he requires medication and has been hospitalised in the past. The effect of his medication, or if he goes off his medication, his symptoms, prevent him from working most if not all of the time.
The Wife was born [in] 1960. She is now 52 years of age. She has been undergoing treatment for depression. However, she is in part-time employment at [omitted] and is likely to be able to continue to work.
The Husband gives his total average weekly income at $500.00, which comes from [C] Superannuation. The Wife is in employment. She gives her total average weekly income as $832.00.
The Husband has little if any capacity for gainful employment. The Wife has a capacity for gainful employment, which she is exercising. She has been with her current employer for over 17 years.
The Wife has the care and control of the parties’ daughter, [X], who was born [in] 1997. [X] is now 15 years of age. The Mother claims that [X] is intellectually disabled and has learning difficulties. She consults a psychologist.
There is no parenting order in force in respect of [X], but it is likely that she will continue to live with wife. She has little in the way of contact with her father and it appears that her primary carer is her mother, with the assistance of her maternal grandmother.
It is a serious shortcoming in the Mother’s case that no independent evidence has been provided about [X]’s disability and her prognosis. The evidence comes from the assertions in the Wife’s affidavit and a concession by the Husband that [X] has learning difficulties and other disabilities.
The Husband’s income derives from superannuation. The Wife states in her Financial Statement of 29th April 2011 that she receives a Carers Allowance, Family Allowance and a Carer’s pension.
The Husband pays Child Support for the child. The Wife’s evidence is unreliable on this point but the husband claims in his Financial Statement that he is paying $25.00 per week.
There are no other orders under the Family Law Act affecting the parties or the child [X]. The parties appear to be still married, as the Husband’s Application for Divorce was withdrawn.
Taking these matters into account, I am of the view that there should be an adjustment in favour of the Wife. If the former matrimonial home is to be sold, the Wife would need to rehouse herself, her elderly mother, who appears to be aged about 85, and, of course, the parties’ daughter [X]. I accept from the evidence that [X] appears to be a difficult child to parent.
The likelihood of the Husband obtaining his own home in the foreseeable future appears to be very remote and it is conjectural whether he would be able to function effectively if he were to live alone, given his mental and physical health issues.
The adjustment to the parties’ contribution based entitlements is assessed at 10% in favour of the wife.
Thus, I assess the parties’ entitlements at 65% to the wife and 35% to the husband. However, the Court must still consider whether this would be just and equitable.
Just and Equitable
Subsection 79(2) of the Act provides that the Court shall not make an order under s.79 unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
The issue here is that the Wife seeks an order requiring the Husband to transfer his interest in the former matrimonial home to him, subject to the mortgage being discharged and refinanced into her own name. She seeks that the Husband should receive an amount of $150,000.00 in return for his share. The amount owing on the present mortgage was $150,000.00. She also seeks that the balance of the parties’ assets should be divided as to 75% to her and 25% to the husband.
It has always been the Wife’s case that she wants to keep the house. She cites in her affidavit evidence the child’s fears of having to relocate and her resistance to change.
The Husband, in his affidavit of 16th May 2011, describes at paragraph [31] of his affidavit his wife’s statement to him that she believed the house was haunted. When he told her that this was ridiculous and asked her why, in the circumstances, she wanted to stay there, he deposed that she said to him:
“I’m staying in that house whatever it takes”.[39]
[39] Affidavit of Mr Descas 16.5.2011 at [31]
The Husband went on to depose that after the valuation had been completed and the valuer’s report had been made available, the Wife’s solicitors wrote to the Valuer on 22nd November 2010, raising issues, about the house, all of which appear to suggest that the Wife was seeking to “nobble” the valuer by raising matters which would have a negative impact on the value.
Apart from the ludicrous claim that the house was haunted, referred to at [43] and [44] above, the wife’s solicitors raised these other issues:
1. There is a freight line that runs past the property all day (varying from once or twice each hour to once every 2 hours) and also at 4 times each night which is extremely, particularly in the evenings;
2. The property was previously timber and tiles were laid over the top of the exterior shortly before our client and the husband purchased same in 1996;
3. The bathroom shower leaks and slugs commonly inhibit[40] the shower through the floor waste;
4. The property has had 2 separate termite infestations, the first infestation occurred approximately 6 years ago and the second occurred approximately 3 years ago;...[41]
[40] sic
[41] Affidavit of Mr Descas 16.5.2011 Annexure “B”
The Husband’s solicitors wrote to the Valuer on 24th November 2010, disagreeing with all of the Wife’s contentions, including the alleged haunting.
The Valuer replied on 23rd November 2010, advising that none of the issues had any bearing on the valuation.
It is hard to see any other motive for writing to the valuer after the valuation was issued than a blatant attempt to persuade the valuer to reduce the figure he had put on the property.
The best interpretation that can be put on this letter is that it reflects the intensity of the Wife’s wish to retain the former matrimonial home.
Whilst the Wife clearly wishes to retain the former matrimonial home, it would not be just and equitable to adjust the figures in her favour just so that she can buy the Husband out at the price she is prepared to pay, or can afford to pay. The difficulty is that the former matrimonial home is by far the largest asset.
The only assets that the Husband has apart from his interest in the home are his superannuation, valued at $49,325.51, and his household contents, valued at $10,000.00. Allowing for the Husband to retain those items, a payment to him of $150,000.00 would see a significant shortfall in the amount to which he should be entitled.
The net total of the asset pool is $710,326.51. The Wife’s share, at 65%, amounts to $461,712.23. The Husband’s share, at 35%, amounts to $248,614.28. After retaining his household items and superannuation, amounting to $59,325.51, the Husband should receive the sum of $189,288.77. The Wife’s proposal is that the Husband should only receive $150,000.00, a shortfall of $39,288.77, or about 5.53% of the total.
I am not satisfied, taking into account all the matters which have been taken into account, that it would be just and equitable to vary the parties’ entitlements so that the Wife were to receive 70% of the net assets and the Husband only receive 30%. I have already considered the need for the Wife to have a home for herself and the child, and for her elderly mother, and made a 10% adjustment in the Wife’s favour.
Orders to be made
The net total of the parties’ assets amounts to $710,326.51.
The Wife will be entitled to 65% of the net assets, amounting to $461,712.23. The Husband will be entitled to 35% of the net assets, amounting to $248,614.28.
The Wife will retain:
a)Her Westpac Account;
b)Her ANZ Account;
c)Her Toyota Corolla;
d)Her superannuation, amounting to $60,815.00; and
e)The home at Property D, [D], subject to her paying to the husband the sum of $189,288.77.
The Husband will retain:
a)His household contents, valued at $10,000.00; and
b)His superannuation, amounting to $49,325.51.
In addition the Husband will receive a payment of $189,288.77 in return for his interest in the former matrimonial home.
I propose to allow four months for the Wife to arrange the necessary finance, which is slightly more than the wife sought in her Short Minute of Orders. If it should transpire that the Wife is unable to arrange sufficient finance to buy out her Husband’s interest, then the parties will need to sell the home and divide the net proceeds between them as to 65% to the wife and 35% to the husband.
If either party seeks to pursue an application for costs, he or she may do so by way of a written submission, to be filed and served on the other party within 21 days. A further 14 days will be allowed for any written submission in reply.
I certify that the preceding one hundred and sixty-nine (169) paragraphs are a true copy of the reasons for judgment of Scarlett FM
Date: 29 January 2013
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