Destina & Destina

[2007] FamCA 1485

FAMILY COURT OF AUSTRALIA

DESTINA & DESTINA [2007] FamCA 1485

FAMILY LAW – APPEAL FROM FEDERAL MAGISTRATES COURT – EVIDENCE – Established that Federal Magistrate made an unsafe finding in relation to a disputed debt by relying on uncorroborated evidence. Jones v Dunkel (1959) 101 CLR 298 cited. Appeal allowed.

FAMILY LAW - DISCRETION – Not established that Federal Magistrate gave undue or insufficient weight to any fact or circumstance in determining the relevant entitlements of the parties. Gronow v Gronow (1979) 144 CLR 513, Norbis v Norbis (1986) 161 CLR 513 and AMS & AIF [1999] 199 CLR 160 referred to.

Family Law Act 1975 (Cth) s 75(2)

Jones v Dunkel (1959) 101 CLR 298
Gronow v Gronow (1979) 144 CLR 513
Norbis v Norbis (1986) 161 CLR 513
AMS & AIF [1999] 199 CLR 160
Allesch v Maunz (2000) 203 CLR 172

APPELLANT: MS DESTINA

RESPONDENT: MR DESTINA

INTERVENOR:

INDEPENDENT CHILDREN’S LAWYER:

FILE NUMBER: PAC
PAM 1295
1226 Of
Of 2007
2004

APPEAL NUMBER: EA 98 of 2007

DATE DELIVERED: 30 November 2007

PLACE DELIVERED: Parramatta

PLACE HEARD: Parramatta

JUDGMENT OF: Coleman J

HEARING DATE: 5 November 2007, 20 November 2007

LOWER COURT JURISDICTION: Federal Magistrates Court

LOWER COURT JUDGMENT DATE: 9 November 2006

LOWER COURT MNC: [2007] FMCAfam 717

REPRESENTATION

COUNSEL FOR THE APPELLANT: Mr Stewart

SOLICITOR FOR THE APPELLANT: Tony Vella Solicitors

COUNSEL FOR THE RESPONDENT: Self-Represented (not present)

SOLICITOR FOR THE RESPONDENT:

Orders

1. That the appeal be allowed in part.

2. That Order 4b which provides “In payment of a loan from M Destina to the parties jointly, currently standing at approximately AUD$51,000.00” of the orders of 9 November 2006 be set aside and the orders otherwise confirmed.

3. That the Court grants to the Appellant Wife a costs certificate pursuant to the provision of s.9 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the Appellant Wife in respect of the costs incurred by the Appellant Wife in relation to the appeal.

IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of the Full Court delivered this day will for all publication and reporting purposes be referred to as          Destina & Destina.

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT PARRAMATTA

Appeal Number: EA98/2007
File Number: PAC1295/2007, PAM 1226/2004

MS DESTINA

Appellant

And

MR DESTINA

Respondent

REASONS FOR JUDGMENT

1. By Notice of Appeal filed 23 October 2007 Ms Destina (“the appellant”) filed a Notice of Appeal against orders made by Federal Magistrate Halligan on 24 August 2007 in proceedings between the appellant and Mr Destina (“the respondent”).

2. The orders the subject of the Notice of Appeal were made on 9 November 2006 (although the Notice of Appeal refers to orders of 24 August 2007). The appellant’s Notice of Appeal was filed pursuant to leave granted by the Court on 27 April 2007.

3. The respondent resisted the appeal and sought to maintain the learned Federal Magistrate’s orders.

4. The orders of the Federal Magistrate provided that the parties’ former matrimonial home at P in the State of New South Wales be sold and the proceeds of sale after payment out of a number of liabilities be divided as to 60 per cent to the appellant and 40 per cent to the respondent.

5. The Notice of Appeal does not disclose the orders sought by the appellant in the event of the appeal against his Honour’s orders being successful. It is reasonably apparent from the written submissions of Counsel for the appellant however that the appellant sought a division of 70 per cent of the net proceeds of sale of the P property in her favour, albeit after the payment out of fewer liabilities than the learned Federal Magistrate’s orders provided be discharged.

Background

1. The parties married in 1975, separated in 2001 and were divorced in 2003. Their cohabitation accordingly subsisted for in the order of 26 years.

2. The respondent was aged 63 at the date of the learned Federal Magistrate’s judgment. The appellant was then 57.

3. There were three children of the parties’ marriage, those children being aged almost 30, 26 and 23 years at the date of the learned Federal Magistrate’s judgment. None of the children of the parties was dependent upon either of the parties.

4. The learned Federal Magistrate determined the gross asset pool to be worth $208 128.86, a conclusion which is not controversial in this appeal. His Honour accepted that the respondent was indebted to his brother in the sum of $51 000 which sum he took into account, thereby reducing the net asset pool to $157 128.86. The learned Federal Magistrate’s acceptance of the husband’s alleged indebtedness to his brother is controversial in this appeal.

5. The learned Federal Magistrate concluded that the contributions of the parties favoured the wife over those of the husband by 65 per cent to 35 per cent. That entitlement was reduced to 60 per cent after his Honour adjusted by 5 per cent in favour of the husband pursuant to s 75(2) Family Law Act 1975 (Cth) (“the Act”).

The Reasons for Judgment of the learned Federal Magistrate

1. The learned Federal Magistrate identified the competing applications at the commencement of his Reasons for Judgment, concluding that the appellant sought the net asset pool of $208 000 be divided as to 70 per cent to her and 30 per cent to the respondent. The entitlement of the respondent on that basis would thus have been in the order of $60 000. (Appeal Book, Volume 1, page 22, par 1)

2. The respondent sought that the net assets after repayment of his alleged indebtedness to his brother of $51 000 be divided equally between the parties, the entitlement of each party thus becoming approximately $80 000. (Appeal Book, Volume 1, page 22, par 2).

3. The learned Federal Magistrate reviewed the evidence of each of the parties. In the course of that review, his Honour considered the evidence in relation to the history of their relationship from the date of their marriage in the Philippines in 1975, at which time he concluded neither party had any significant assets, to the time the parties migrated to Australia in 1989. (Appeal Book, Volume 1, pages 23 – 24, pars 5 – 9). Reference was made to the rival contentions in relation to the savings which the parties then had. The appellant suggested the savings to have been less than $1000, whilst the respondent asserted a figure of $5000, a factual dispute which, unsurprisingly, the learned Federal Magistrate was unable to resolve on the evidence. (Appeal Book, Volume 1, page 23, par 10).

4. The history of the parties’ cohabitation subsequent to arriving in Australia was then considered by his Honour. Particular reference was made to the respondent’s frequent and lengthy sojourns in the Philippines from the time the parties migrated to Australia until their ultimate separation. (Appeal Book, Volume 1, pages 24 – 26, pars 11 – 21).

5. The learned Federal Magistrate referred to the acquisition of the former matrimonial home of the parties at P in 1993 for $115 500. He found that the parties had paid a deposit of $11 550, inferentially from funds which the parties had saved over the previous four years. A mortgage of $89 000 was obtained to assist with the purchase, the balance of the purchase monies, of approximately $15 000 being found by his Honour to have come “from funds available to the parties”. (Appeal Book, Volume 1, pages 26 – 27, par 22). The learned Federal Magistrate found the evidence in relation to the source of the monies applied for the purchase of P (inferentially $26 000 in total) to have been less than conclusive. (Appeal Book, Volume 1, page 27, pars 23 – 25).

6. His Honour then considered the respondent’s allegation that he had contributed “remittances he instigated from the Philippines” between August 1995 and December 1999 totalling $152 600 of which $116 500 was allegedly provided by the respondent’s half brother, M, a “reasonably well off individual in the Philippines” who was “giving the husband some legal work”. (Appeal Book, Volume 1, pages 27 – 28, par 26).

7. The respondent’s claim was described by the learned Federal Magistrate as being “that from time to time [the respondent] would ask his brother to lend funds to him by way of transferring those funds to the wife’s Bank account”. (Appeal Book, Volume 1, page 28, par 26).

8. Reference was made to a copy letter dated 3 April 2001 from the E Bank in the Philippines “evidencing transfers in accordance with the husband’s evidence and they total $116 500 between May 1996 and May 1999”. (Appeal Book, Volume 1, page 28, par 27).

9. His Honour also referred to the evidence of the respondent that after subsequent repayments “he still owes his brother $51 000”. (Appeal Book, Volume 1, page 28, par 28). The learned Federal Magistrate recorded that the appellant “disputed that there was such a loan”, her position being that through her Counsel she “in effect challenged the husband’s evidence about it” and submitted that the Court should not find that such loan existed. (Appeal Book, Volume 1, page 28, par 29).

10. Tendered in evidence was a document, “Exhibit H” described by his Honour as “bearing signatures purporting to be the husband’s and his brother’s acknowledging a debt by the husband to his brother of 1.8 million Philippines pesos”. Whilst there was no precise evidence as to the exchange rate, his Honour concluded by reference to the annexures to the respondent’s affidavit that such sum “may well approximate the amount that the husband says he is owed in Australian dollars”. (Appeal Book, Volume 1, page 28, par 29).

11. The learned Federal Magistrate’s conclusion in relation to the alleged loan commenced with his observations that:-

    30.The wife’s evidence was that she was not in a position to admit the specific remittances that the husband said were made to the wife’s bank account from the Philippines without being able to check her back accounts. And her evidence further was that whilst she had some of the statements from her Bank account, she had none of the statements that coincided with any of the dates of any particular transfer of funds that the husband identified as having been made by him or at his behest. (Appeal Book, Volume 1, page 28, par 30).

12. His Honour then recorded:-

    31.As I say; the wife did not dispute that moneys were transferred to her account at the husband’s instigation from the Philippines. At no point in her evidence did she give any clear indication as to the amount she received, although the clear flavour of her evidence was to suggest that these amounts were quite irregular and quite inadequate to assist her in any serious way in meeting the expenses of the household of herself and the parties’ three children. However, I note that one of the remittances, which was one made by the husband’s brother on his behalf on 25 September 1996, was over 1 million Philippine pesos: said to be the equivalent of $50,000 Australian. I find it difficult to understand why the wife would not have a recollection of such a large deposit to her account. At no point did she deny such a deposit. She simply said without her bank accounts she could not acknowledge having received it. But I repeat; it is difficult to understand why the wife would not remember such a large deposit if it in fact had occurred. The evidence suggests that the wife’s [sic] would not have been in the habit of having large sums of money in her bank account. Quite the contrary. (Appeal Book, Volume 1, page 29, par 31).

13. The learned Federal Magistrate concluded that the appellant had been “evasive in her evidence in relation to these payments from the Philippines” and was “satisfied that the moneys that the husband says were remitted from the Philippines by him or at his behest were in fact remitted and were in fact received by the wife and used by her”. (Appeal Book, Volume 1, page 29, par 32). His Honour also preferred the evidence of the respondent to that of the appellant in relation to sums of money brought to Australia by the respondent from time to time, albeit the totality of such funds brought to this country or caused to be remitted to this country was not quantified. (Appeal Book, Volume 1, page 29, par 33).

14. The learned Federal Magistrate referred to the appellant’s receipt in 1999 of approximately $43 000 net by way of unpreserved superannuation benefit which sum she applied to reduce the mortgage over the P property. (Appeal Book, Volume 1, page 30, par 37). For reasons which he detailed, he concluded that the “vast bulk” of $39 133.27 received by the wife upon the realisation of an investment property subsequent to separation was used by her for gambling. (Appeal Book, Volume 1, page 32, par 44).

15. His Honour concluded that, after 1991 the “child rearing, caring and homemaking responsibilities have fallen exclusively to the wife”. (Appeal Book, Volume 1, pages 32 – 33, par 45).

16. The learned Federal Magistrate concluded that each party was “in a fairly poor financial position”, the respondent being reliant upon “gratuities received from relatives” of $180 per week. The respondent resides in the Philippines and, as of January 2007 could not “continue or resume living in Australia thereafter as of right”. (Appeal Book, Volume 1, page 33, par 46). His Honour accepted that the wife was in receipt of unemployment benefits of $210 per week and board from two adult children living with her totalling $125 per week. There was no medical evidence before his Honour in relation to the health of either party, nor, his Honour recorded, was there any evidence of the attempts of either party to obtain employment. (Appeal Book, Volume 1, page 33, par 48).

17. Having described the “Applicable legal principles” (Appeal Book, Volume 1, pages 33 – 34, par 50), the learned Federal Magistrate identified the assets and liabilities of the parties. The assets comprised the P property with an agreed value of $285 000 and the appellant’s superannuation worth $4778.90, against which was offset the liability on the mortgage over P of $81 650.04. (Appeal Book, Volume 1, page 34, par 51). Having, for reasons which he had earlier given, accepted the evidence of the respondent, the learned Federal Magistrate concluded that “he does in fact owe his brother the $51 000 that he has referred to”. The asset pool was thus determined to be worth $157 128.86 net. (Appeal Book, Volume 1, page 34, par 52).

18. Under the heading “Assessment of Contributions” His Honour revisited the contributions which he had earlier detailed. For reasons which he gave, he concluded that the monies the appellant had gambled were more appropriately taken into account under s 75(2)(o) of the Act than considered in the context of contributions. (Appeal Book, Volume 1, pages 34 – 35, par 53).

19. His Honour concluded that the respondent the “primary though not the sole breadwinner” during the first fourteen years of cohabitation” and that, during that time the appellant was considered to have been “the sole homemaker and parent without assistance” from the respondent. From shortly after the time of their arrival in Australia, the appellant was found by his Honour to have been “consistently in employment until 1999” since which time she had “some difficulty obtaining employment”. (Appeal Book, Volume 1, page 35, par 54).

20. Except for a period of one month, his Honour found that the respondent had no employment in Australia, and had “returned to the Philippines to work and derive income to support the family. He has sent funds to Australia” of “a little over $100 000 during a period of something like eight years or more from his return to the Philippines until the parties separated.” (Appeal Book, Volume 1, page 35, par 55).

21. His Honour concluded that the appellant earned “considerably more, and more significant” amounts than did the respondent during that period notwithstanding that such amounts as the respondent remitted were “significant sums and they cannot be ignored”. The contribution by the respondent’s sister of rent-free accommodation to the family was also considered by his Honour to be a contribution upon which the respondent could rely. (Appeal Book, Volume 1, page 35, par 55).

22. The learned Federal Magistrate reiterated his earlier finding that apart from a “relatively short period” after the parties arrived in Australia the appellant had “almost single handed fulfilled the role of parent and homemaker in Australia”. (Appeal Book, Volume 1, page 35, par 57).

23. His Honour’s ultimate conclusion in relation to contributions was expressed thus:-

    58.Doing the best I can on the evidence; I take the view that these contributions must clearly favour the wife and favour her fairly significantly because of the gross preponderance of the non-financial contributions that she has made, taken together with the fact that she has also been making consistent financial contributions for the major part of the marriage. In fact; I suggest the parties overall contributions as 65/35 favouring the wife. (Appeal Book, Volume 1, page 36, par 58).

24. The “assessment of non contribution factors” pursuant to s 75(2) of the Act was then undertaken. The financial position of each party was there referred to as were their living circumstances, ages and work histories. (Appeal Book, Volume 1, pages 36 – 37, pars 59 – 64).

25. The one matter which the learned Federal Magistrate concluded should enliven s 75(2) adjustment related to the appellant’s utilisation of some of the $39 000 proceeds of sale of the investment property for gambling, the “amount” which he was unable to determine. (Appeal Book, Volume 1, page 36, par 61). Having referred to the financial circumstances of the parties in the post separation period, his Honour reiterated that “a little over $39 000 is simply unexplained” by the appellant. (Appeal Book, Volume 1, page 37, par 62).

26. His Honour’s ultimate conclusion was that:-

    63.Ultimately, I take the view that it is more likely than not that the wife has received for her sole use and benefit, in circumstances which could not be categorised as reasonable, part of the proceeds of sale of the nit to which the husband had a legitimate expectation and claim, and in my view, in the circumstances, some adjustment back in the husband’s favour is warranted. (Appeal Book, Volume 1, page 37, par 63).

27. The adjustment determined by the learned Federal Magistrate to be thus appropriate was 5 per cent, producing a disparity of entitlements of 10 per cent by virtue of that factor, such percentage representing approximately $16 000. The 5 per cent adjustment produced an overall division of the net assets as found by his Honour 60 per cent to the appellant and 40 per cent to the respondent. (Appeal Book, Volume 1, page 37, par 64).

28. For the reasons which he detailed, the learned Federal Magistrate concluded that such division of assets was just and equitable. (Appeal Book, Volume 1, page 37, par 65).

The Grounds of Appeal

1. Learned Counsel for the appellant provided a comprehensive and cogently reasoned summary of the appellant’s argument on 17 October 2007. For reasons which are not hard to understand, the respondent did not receive that document in time to be able to respond from the Philippines prior to the hearing of the appeal on 5 November 2007.

2. Learned Counsel for the appellant sensibly conceded that the respondent should have the opportunity to file a summary of his submissions before the Court reserved his decision. On or about 15 November 2007, by way of affidavit, the respondent filed his submissions.

3. On 20 November 2007 learned Counsel for the appellant advised the Court that he did not wish to be heard in response to the submissions of the respondent.

Ground 1

1. Ground 1 of the Notice of Appeal provided:-

   1.That His Honour erred in finding that there was a debt owing by the parties jointly to M Destina. (Appeal Book, Volume 1, page 3, par 1).

1. As learned Counsel for the appellant suggested in his written summary of argument, the learned Federal Magistrate’s finding that the husband was indebted to his brother in the sum of $51 000 was challenged by a number of grounds of appeal. Learned Counsel sensibly, in the Court’s view, dealt with “the fundamental issues under this ground”.

2. The Court would understand this approach to encompass grounds 4 and 5 of the Notice of Appeal which provided:-

   4.   That his Honour erred in law in making provision for an unquantified debt to a third party without proper evidence of the third party that the sum was owing.

   5.   That his Honour erred in law in making provision for repayment of an unquantified debt to a third party without proper evidence of the third party that the sum was owing. (Appeal Book, Volume 1, page 3, pars 4 & 5).

3. In support of those challenges to the learned Federal Magistrate’s finding that the husband owed his brother $51 000 it was submitted that no reasons, or sufficient reasons were provided for such finding.

4. It was, fairly and sensibly, conceded by learned Counsel for the appellant that this Court would be “reluctant” to interfere with the learned Federal Magistrate’s preference for the evidence of the respondent to that of the appellant in relation to the disputed debt. (Appeal Book, Volume 1, page 7, par 1.a). It was submitted that “[w]hat his Honour has done however is to express a preference on a specific issue of receipt of funds from the Philippines, not the existence of a current debt owed to the husband’s brother”. (Appeal Book, Volume 1, page 7, par 1.a).

5. It was further contended that “at all material times it was clear that the existence of this alleged debt was an issue between the parties. It was the husband who bore the onus of proof of the debt. A preference for the evidence of one witness over another on a specific and limited issue does not permit a finding on other issues, in effect, by default”.

6. In support of his contention, learned Counsel for the appellant relied upon the absence of evidence from the respondent’s brother and the absence of any explanation for the failure of the respondent’s brother to give such evidence. The Court was reminded that the learned Federal Magistrate had in fact raised this issue with the respondent during the course of the trial, by suggesting “[t]here is no explanation in the material that I have seen, and I just want to make sure I have not missed it, as to why your client has not called his brother to corroborate his evidence about the loan”. (Appeal Book, Volume 2, page 301, lines 20 – 22).

7. In the transcript of the trial to which Counsel referred the court, there followed some inconclusive exchanges, after which the learned Federal Magistrate said in relation to an apparent “falling out” between the respondent and his brother:-

   …and the brother calling the loan in, I would have thought have been motivation to him to provide evidence to corroborate the loan because your client says his brother now wants it repaid. That is a motivation for him to, I would have thought, stand up and assert the loan rather than fail to assist your client to assert the loan. (Appeal Book, Volume 2, page 301, lines 30 – 34).

8. His Honour then suggested that:-

   The evidence wouldn’t have assisted your client’s case.

   Counsel then representing the respondent replied:-

   [A]bsent explanation, and I would urge that your Honour would find that there is sufficient explanation of his absence. Your Honour, there is evidence of the falling out. (Appeal Book, Volume 2, page 301, lines 43 – 48).

9. Having said that the matter was one for final submissions the learned Federal Magistrate said:-

   I don’t accept that the – I mean the falling out hasn’t prevented, according to your client’s evidence, he and his brother entering into further commercial arrangements, or commercial like arrangements, in relation to taking over the offices. (Appeal Book, Volume 2, page 302, lines 6 – 9).

10. His Honour added:-

    So I would need to be satisfied on that before I would accept the evidence of the suggested falling out as being such a falling out that the brother would be simply unprepared to assist. (Appeal Book, Volume 2, page 302, lines 24 – 26).

11. Counsel then appearing for the respondent acknowledged his Honour’s point.

12. His Honour then stated:-

    If it was a complete falling out so they weren’t talking any more and there was acrimony between them and there was action by the brother to recover the debt in the Philippines, well if there was then perhaps he wouldn’t need any more than evidence of that to help corroborate it but – that sort of matter, then I might understand it. But that isn’t the case, as I say, they have entered into further commercial agreement, so the falling out hasn’t resulted in such acrimony as might mean that they are not on speaking terms and not in a position to conduct commercial negotiations to their mutual satisfaction. (Appeal Book, Volume 2, page 302, lines 30 – 38).

13. Learned Counsel for the appellant also referred the Court to cross-examination of the respondent by Counsel then appearing for the appellant, during which it was suggested to the respondent:-

    I understand that your half brother M has not filed an affidavit in this matter to help you, saying that you owed him money. Isn’t that correct?

    The respondent replied:-

    No, your Honour. (Appeal Book, Volume 2, page 342, lines 4 – 8).

14. Confusion then appeared to reign momentarily before Counsel then representing the respondent said:-

    Your Honour, there is an affidavit just been both filed and served. It wasn’t relied on for reasons that perhaps don’t concern the Court. (Appeal Book, Volume 2, page 342, lines 19 – 20).

15. There followed some exchanges which are not material for present purposes after which Counsel then representing the appellant said:-

    Now, in relation to this matter here today, you are not relying on any affidavit that your brother swore and that was filed and that was served on me? (Appeal Book, Volume 2, page 342, lines 46 – 48).

16. After several attempts, including interventions by the learned Federal Magistrate, it became apparent that, for whatever reasons, the respondent did not seek to rely upon the affidavit apparently sworn and filed by the respondent’s brother. (Appeal Book, Volume 2, pages 343f).

17. The learned Federal Magistrate went to some lengths to clarify whether Counsel then representing the respondent sought to rely upon the respondent’s brother’s affidavit. His Honour perceived, correctly it seems from the transcript, that the respondent and his then Counsel were not necessarily of the same view as to whether or not the husband’s brother’s affidavit was sought to be relied upon. His Honour squarely raised that with Counsel then representing the respondent by saying:-

    Now, I am just wanting to make sure that you are not left frankly in a difficult position by what’s fallen from the witness. (Appeal Book, Volume 2, page 345, lines 7 – 9).

18. In the course of his response to the learned Federal Magistrate, Counsel then representing the respondent said:-

    Certain instructions were given and as a result your Honour I didn’t seek that your Honour read that affidavit. (Appeal Book, Volume 2, page 345, lines 15 – 16).

19. His Honour then asked:-

    Are you content then for the matter to proceed from here?

    Counsel replied:-

    Yes, your Honour. (Appeal Book, Volume 2, page 345, lines 18 – 21).

20. Subsequent questions from the learned Federal Magistrate established, beyond reasonable doubt it could be suggested, that the respondent was not seeking to rely upon the affidavit sworn by his brother which had apparently been filed and served upon the appellant’s attorneys. (Appeal Book, Volume 2, page 345, lines 28 – 40).

21. Learned Counsel for the appellant submitted that in cross-examination of the appellant it was never suggested that she was “aware of any loan from the brother”. (Appeal Book, Volume 1, page 8, par 1.d). Reliance was placed upon comments by the learned Federal Magistrate during the course of the trial that there was no suggestion to the appellant at the times that these sums were being received during the marriage that they were in fact loans from the respondent’s brother.

22. During the course of submissions by Counsel then appearing for the respondent, the learned Federal Magistrate asked:-

    Is there any evidence that at any stage he (the respondent) told the wife that, in fact, the monies that he was remitting to help support the family were being borrowed? (Appeal Book, Volume 2, page 372, lines 24 – 26).

23. Counsel confirmed that there was no such evidence, to which the learned Federal Magistrate responded:-

    I didn’t think that there was. So what’s the husband’s saying that for part of the time before separation and after he had primarily returned to live in the Philippines and the wife and children remained in Australia, but not for all of it, he was sending remittances of money to the wife in Australia. He says that they were to assist the wife to meet living expenses in Australia. He says that some of that – in fact, the bulk of it was borrowed. Some of it he subsequently repaid. But the moneys that were borrowed – and they include very substantial amounts including one of $50,000 – again, why $50,000 was sent in one lump sum to meet day-to-day living expenses, I have no idea. I mean, a lot of this case doesn’t make sense, but nonetheless that’s the evidence.

    And there’s no suggestion to the wife that this was borrowed money that, perhaps, if she knew was giving rise to an ongoing obligation, she may have been able to, perhaps, modify expenditure patterns and ameliorate the incurring of the debt. But it was being provided to her, the evidence would suggest, with no indication this was borrowed funds having to be repaid, but it was money for her to spend and feel free to spend as necessary to support the family. (Appeal Book, Volume 2, pages 372 – 373, lines 32 – 2).

24. Counsel then appearing for the respondent replied:-

    Your Honour, that would appear to be the current state of the evidence, yes.

    To which his Honour replied:-

    All right. I’m just a little bit concerned as to the suggestions in relation to such large sums being borrowed and sent over for living expenses, with no indication that they’re borrowed at the time they were allegedly borrowed. Now even if they are borrowed, whether or not in justice and equity, the wife now ought to be left to carry the can equally with the husband in relation to these funds, when she was being given moneys which she would’ve been entitled, I assume, to infer were the husband’s – he didn’t say they weren’t – and being provided for her use, with no indication that there was any loan. I’m just a bit troubled by that, Mr L. (Appeal Book, Volume 2, page 373, lines 4 – 15).

25. Ultimately the exchange concluded with Counsel then appearing for the respondent saying, “I can’t take that any further, your Honour.” (Appeal Book, Volume 2, page 373, line 22).

26. The submissions of learned Counsel for the appellant in this Court point out that “a finding that sums of money have been received (sic) in the Philippines does not constitute a finding that those sums were a loan or that if they were a loan, that the loan is currently enforceable”. (Appeal Book, Volume 1, page 8, par 1.f).

27. Whilst that submission is undoubtedly correct, it overlooks a more fundamental issue: the source of the funds. Had the Court concluded that $51 000 was obtained by the parties, and had been provided by the respondent’s brother, that could have been seen as a contribution by or on behalf of the husband, the effect of which would be, albeit not necessarily by $51 000, to materially increase the husband’s contributions. However, the respondent’s case before the learned Federal Magistrate was at all times that the monies represented a loan.

28. Learned Counsel for the appellant referred to “potential difficulties in the developing practice of counsel not taking objections to evidence on affidavit”. A number of instances of those “potential difficulties” were then detailed. Whatever “potential difficulties” might be seen at trial, this Court does not labour under difficulties in relation to the evidence complained of. (Appeal Book, Volume 1, page 8, par 1.g).

29. Clearly, references to “loans and gifts” and use of terms such as “advanced” are conclusions, rather than evidence which, if accepted, might lead to such conclusions. In the circumstances of the case, where there was an affidavit sworn by the respondent’s brother but not sought to be relied on, the Court could not properly have had regard to conversations between the respondent’s hearsay evidence of conversations with his brother. (Appeal Book, Volume 1, page 8, par g).

30. Reliance was placed upon the evidence of the respondent in cross-examination that “as a lawyer” he had never had a loan agreement between himself and his brother drawn up in relation to the alleged debt. (Appeal Book, Volume 2, page 202, par 20). The respondent confirmed in cross-examination that there had not been a loan agreement, but that his brother “will just note in his diary like that, on a piece of paper, then when he stopped lending me, you owe a balance of this amount, sign it, he told me like that”. (Appeal Book, Volume 2, page 347, lines 5 – 7).

31. The respondent referred in that context to a “certification” to which he was then referred, and which ultimately became exhibit “H” in the proceedings. The document has not been replicated in the Appeal Books in this Court, although, unhelpfully, a list of the Exhibits has. (Appeal Book, Volume 2, page 347, line 12f).

32. It was submitted, correctly the Court accepts that “[i]n the absence of evidence” from the respondent’s brother, “it is difficult to see how any such document could be admissible to prove the currency, enforceability or quantum of the alleged loan unless it is a business record” no evidence before the learned Federal Magistrate establishing the probability of the document being so. (Appeal Book, Volume 1, page 9, par 1.h). The Court also accepts that no other basis for the receipt of what was otherwise hearsay evidence can be shown to have been made out.

33. The Submissions of learned Counsel for the appellant in relation to this challenge are well encapsulated in his final submission that:-

    j.Bearing in mind the caution expressed by the High Court in Jones v Dunkel (1959) 101 CLR 298 and the fact that the wife was not in a position to admit or deny the debt as acknowledged by His Honour at AB 28.6, it is submitted that the finding made by His Honour was unsafe and not reasonably open to him. (Appeal Book, Volume 1, page 9, par 1.j).

34. The respondent, although represented at trial, prepared his own written submissions in response to the submissions of learned Counsel for the appellant. The submission contains a number of colourful but unhelpful comments. The submissions in relation to the disputed loan appear to commence at paragraph 4 of the respondent’s Summary of Argument.

35. Much of the respondent’s submissions are not of assistance in the current context, whatever utility they might have at a trial at first instance. In the submission which is in point, the respondent suggested:-

    When I was also asked in same cross-examination by Mr. Vella if I have any document to prove this loan, I replied in the affirmative and was [sic] presented to him and to the Hon. Presiding Magistrate that document of loan agreement stated in all my affidavits filed to the Court and served. I then identified the signatures of my brother and myself in open court. (Submissions of Respondent, page 4, par 5).

36. The respondent further suggested:-

    Because this document of debt agreement could not be found in the Appeal Book, I am submitting herewith a copy for the appellate court’s ready reference and marked as Annexure “A”. (Submissions of Respondent, pages 4 – 5, par 6).

37. With all due respect to the respondent, in the absence of evidence by the respondent’s brother, or any explanation for the failure to adduce such evidence, particularly as it was clearly available in the form of the affidavit which the respondent’s brother had sworn and the attorneys then representing the respondent had filed and served upon the attorneys for the appellant, the “certification”, even if admissible, could not in this Court’s view have been safely given any significant weight.

38. If admitted, giving the certification any such weight would have been quite inconsistent with the principles of natural justice as a conscious decision had been taken by the respondent and those advising him not to present the evidence of the other party to the “certification” to which the respondent referred the Court.

39. Also relevant for present purposes is the submission on behalf of the respondent that:-

    Also in Annexure “A” of the Affidavit, page 0210 of the Appeal Book 2, which is the [E] BANK Certification, it is very clear that all the amounts stated therein came from my brother and directly deposited in the bank account of [the] applicant with the Bank. That there was a big amount of $50,000.00 in one instance of deposit made on 25 Sept. 1996. (Submissions of Respondent, page 5, par 8).

40. With respect to the respondent, the E Bank letter of 3 April 2001, though addressed to the husband’s brother, and although potentially a business record, does not establish on its face the facts asserted by the respondent in relation to the alleged loan. Even if the statement did establish that the funds “came from” the respondent’s brother, that does not establish that such funds, or any portion of them, were loan monies. It is to be remembered that the learned Federal Magistrate accepted that the husband had repaid to his brother approximately $116 500. (See Appeal Book, Volume 1, pages 28 & 29, pars 27 & 32).

41. At best the E Bank Statement is consistent with the learned Federal Magistrate’s finding that monies of the approximately $116 500 had been provided to the respondent by his brother and repaid by the brother.

42. The respondent having elected to refer to this document in support of his contentions with respect to a loan from his brother, it could be regarded as significant, given the date of letter, that the deposits do not total the higher figure to which the learned Federal Magistrate referred.

43. With respect to the respondent, the E Bank Statement does not advance his contentions in relation to the disputed loan.

44. The balance of the submissions of the respondent are more in the nature of submissions which could, and in some instances were, made at trial, but cannot advance the respondent’s cause in this appeal.

45. The respondent submitted:-

    The Hon. Magistrate was correct when he observed that this issue of [the] loan (mentioned in all my affidavits and that of my brother) was corroborated by the written loan agreement being called as a commercial document dated since 18 May 2004, which was even attached as an annexure of my Affidavits and my brother previously filed and served. This loan agreement was given weight and accepted by the court as part of my evidence without any objection from [the] applicant’s solicitor when presented. It could no longer be raised on appeal. It is clearly not an error of law. The allegations of [the] applicant regarding this issue of [the] loan are all [an] afterthought as a result of her naughty imagination just to evade payments to my brother. This is unfair and illogical. It was never objected [to] or commented [on] from the beginning and it was only on this appeal [sic]. It was also observed by the Hon. Magistrate that my falling out with my brother was reasonable in not presenting for cross-examination. (Submissions of Respondent, page 6, par 11).

46. Reference was then made to the passages of transcript to which reference has earlier been made.

47. The submission on behalf of the respondent that “the allegation of my falling out to my brother is not a valid reason not to pay him” suggests that, with respect to him, the respondent may not appreciate the point which is raised by learned Counsel for the appellant and to which reference has been previously made. (Submissions of Respondent, page 8, par 12).

1. As the learned Federal Magistrate himself suggested, a “falling out” between the respondent and his brother could reasonably be thought to render the brother more anxious to ensure that the respondent’s indebtedness to him was confirmed by the Court than to refrain from facilitating such an outcome by declining to give evidence.

2. There is ultimately no need for this Court to speculate about that matter however as it is clear from the transcript that the respondent’s brother swore an affidavit which was filed and served upon the appellant’s attorneys. Ultimately, for reasons which were never revealed, that affidavit was not sought to be relied upon.

3. As the learned Federal Magistrate’s comments at the time make clear, whether or not the affidavit could have been relied upon, and upon what basis, never arose for determination in the light of the decision of the respondent and those representing him not to seek to rely upon the affidavit.

4. No other submission raised by the respondent in relation to the disputed loan, which submissions the Court would understand to probably conclude at paragraph 12 or perhaps paragraph 14, can advance the respondent’s cause.

5. As noted by learned Counsel for the appellant, the appellant’s position in relation to the disputed loan was accurately stated as being that the appellant was “not in a position directly to admit it”. His Honour accurately stated that the appellant had “challenged the husband’s evidence about it” and had submitted that the Court should not “accept that such a loan exists”.

6. The learned Federal Magistrate referred to the “certification”, a copy of which is Annexure “A” to the respondent’s affidavit in this appeal and can be accepted as identical with Exhibit “H” in the proceedings before the learned Federal Magistrate. That document came into evidence during re-examination of the respondent without objection by Counsel then representing the appellant, notwithstanding that, as the passages of transcript earlier referred to in these reasons make clear, it was apparent that no attempt was being made on behalf of the respondent to rely upon the affidavit sworn by the respondent’s brother. (See Appeal Book, Volume 2, page 347, line 12f).

7. In the circumstances, the learned Federal Magistrate cannot be criticised for allowing the receipt into evidence of the “certification”. The same cannot be said of Counsel then representing the appellant who clearly should have objected to the tender of the document in the circumstances revealed by the evidence.

8. The learned Federal Magistrate relied on a number of unsatisfactory aspects of the evidence of the appellant which he detailed and which her learned Counsel in this appeal has, sensibly, acknowledged were open to him. In the circumstances as detailed by the learned Federal Magistrate, it was open to him to conclude that “the monies that the husband says were remitted from the Philippines by him or at his behest were in fact remitted and were in fact received by the wife and used by her”.

9. As pointed out by learned Counsel for the appellant, that however is only part of the issue. In this Court’s view it was open to the learned Federal Magistrate to find that the husband had caused to be remitted to this country funds totalling approximately $152 600 between August 1995 and December 1999.

10. Notwithstanding the matters to which reference has previously been made, the letter from the E Bank in the Philippines having been tendered without objection, it was open to the learned Federal Magistrate to find, as he did, that transfers of funds totalling $116 500 between May 1996 and May 1999 made by the Bank were funds provided by the respondent’s brother. That does not however impact on the probabilities of whether or not the monies were owed by the respondent to his brother.

11. When the learned Federal Magistrate revisited the disputed loan, within the context of determining the assets and liabilities of the parties, his Honour said “[f]or the reasons that I have already given: I accept the evidence of the husband and I find that he does in fact owe his brother the $51,000 that he has referred to”. (Appeal Book, Volume 1, page 34, par 52).

12. Notwithstanding the observations which the learned Federal Magistrate very properly made as a matter of natural justice and substantive law during the course of the trial to which reference has been made, his Honour did not refer in his Reasons for Judgment to the failure of the husband’s brother to give evidence in the proceedings, or to explain the failure to do so.

13. Correctly in this Court’s view, the learned Federal Magistrate identified that as a matter of significance during the course of the trial. Regrettably, when deciding the case, the significance of the failure of the husband’s brother to give evidence, or to explain that failure, does not appear to have been considered. There are cases where the onus of proof of a loan is able to be discharged without the evidence of the other party to the loan. In these cases, the future of the other party to give evidence can have no significance. That, as his Honour recognised during the trial, was not so in this case.

14. The failure was in this case more potentially significant because his Honour was aware that the respondent’s brother had been willing to give evidence and had sworn an affidavit which, for reasons which were never explained, was not sought to be relied upon, notwithstanding, as his Honour pointed out, that the respondent’s brother, having regard to the respondent’s claims of a “falling out”, had a considerable motive for giving such evidence.

15. There is force in the submission of learned Counsel for the appellant that, in the circumstances of this case, the shortcomings in the evidence of the appellant could not properly have impacted on the balance of probabilities in relation to whether or not the respondent was indebted to his brother. This is so, given the findings of fact which were open to his Honour in relation to the funds which came to this country.

16. Had the case in relation to the alleged loan been, which clearly it was not, that the wife denied such loans, preferring the evidence of the husband to that of the wife in relation to the balance of probabilities would have been open to the learned Federal Magistrate. Where however, as was clearly the appellant’s case, no admission was made and the respondent was being put to his proof of matters of which the appellant had no knowledge, the unreliability of the appellant’s evidence in relation to other matters could not impact upon the probabilities. In determining whether, on balance, the respondent’s claim was found to be made out, the absence of knowledge or admissions on the part of the appellant simply left the field open, as it were, for the respondent to establish his claim on the balance of probabilities if he was able, in the absence of a contrary version of events. The respondent’s case was not automatically proved by the unsatisfactory evidence of the appellant in relation to collateral or other matters. Nor could the defects in the appellant’s evidence cure defects in the respondent’s case in support of the loans. His Honour was entitled to conclude, as he did, that the wife’s denials of the receipt of approximately $152 600 from the husband and or his brother were not substantiated. Given that the wife had no knowledge of the loan, and that it was never suggested to her in cross-examination that she did, the issue of the loan revolved entirely around evidence adduced by or on behalf of the respondent.

17. It is necessary in this context to consider the implications of the unchallenged receipt into evidence of the “certification” document. Putting to one side the form of the “certification”, in this Court’s view, no significant weight could safely have been afforded the “certification”.

18. The transcript of the trial makes clear that, for reasons which were never explained, a conscious decision was taken not to seek to rely upon the affidavit of the respondent’s brother. The position is thus that those seeking to rely upon the “certification” adopted a course which denied the appellant the ability to test the author of the certification. To afford the certification significant weight in those circumstances, in this Court’s view, was to err.

19. As a matter of natural justice, if the “certification” was to be relied upon, the appellant should have had the opportunity to test the evidence of its author. The regrettable failure of Counsel then representing the appellant to object to the tender of the “certification”, in circumstances where such an objection would almost certainly have been upheld by the learned Federal Magistrate, does not in this Court’s view alter the reality that, having elected to adopt a course which denied the appellant any opportunity to test the author of the “certification”, no significant weight could safely be attached to it.

20. The challenges agitated by learned Counsel for the appellant in relation to the disputed loan involved what might be described as a “reasons challenge” as well as the contention that his Honour’s finding was, in all the circumstances, unsafe.

21. So far as the reasons are concerned, with the greatest respect to the learned Federal Magistrate, it does appear that his ultimate conclusion in relation to the disputed loan turned very significantly upon what he permissibly perceived during the trial to be unsatisfactory aspects of the evidence of the appellant. Had the case involved a direct conflict or testimony, significant reliance upon those matters may well have been permissible, and sufficient to justify his Honour’s ultimate finding of fact. In this case however, all that could be safely found by reference to the appellant’s evidence was the receipt of and utilisation of funds of the magnitude which his Honour found to have been received. The matters referred to by learned Counsel for the appellant in support of the challenges precluded reliance upon the unsatisfactory evidence of the appellant in relation to the respondent’s claim that a loan existed. Were it necessary to do so, this Court would be inclined to uphold the reasons challenge with respect to the disputed loan. Whether or not the reasons challenge is sufficient, the Court is satisfied that, essentially for the reasons raised by learned Counsel for the appellant, his Honour’s finding with respect to the disputed loan was unsafe.

22. The respondent bore the onus of proving the debt. In this Court’s view the respondent failed to do so. Having pursued a course which denied the appellant the opportunity to challenge the other party to the disputed transaction, notwithstanding that such party had sworn an affidavit to be used in the proceedings, the respondent was left without corroboration of his allegations.

23. To the extent that the only possible source of such corroboration, the “certification”, was received into evidence, giving that document any weight in the circumstances of this trial was unsafe. The position is thus that the respondent, who bore the onus of proof on the balance of probabilities, was left without corroboration of his claims. as learned Counsel for the appellant submitted, the Court was able to draw the inference referred to in Jones v Dunkel (1959) 101 CLR 298. It is important to remember what the court could thus infer.

24. The respondent was not alleged to corroborate his claim, although the absence of such corroboration rendered more difficult discharging the onus of proof which he bore. As this Court’s reasons hopefully explain, in reality all that the respondent could rely upon was his own assertion that he owed his brother the sum of $51 000. He could not, in the circumstances of the case, prove his case on that basis alone.

25. In relation to the “fundamental issue”, it remains only to deal with the submission made on behalf of the appellant that, although not asked to do so, the learned Federal Magistrate should have made an order that the respondent indemnify the appellant in relation to any liability to the respondent’s brother, notwithstanding that it was submitted that the evidence could not support a finding that the respondent was indebted to his brother.

26. With respect to learned Counsel for the appellant, quite apart from the fact that no indemnity was sought by Counsel then appearing, what the respondent’s brother may have suggested to him in relation to liability was not a basis for ordering any indemnity, particularly as the respondent’s case at all material times was that the respondent alone was liable to his brother with respect to the disputed loan.

27. Although not a document which could be safely relied upon in the proceedings before the learned Federal Magistrate, the “certification” prepared and signed by the respondent’s brother would be a very substantial, and probably decisive evidentiary hurdle to any claim by the respondent’s brother against the appellant.

28. The Court is not persuaded that the learned Federal Magistrate erred in not ordering that the respondent indemnify the appellant with respect to any liability of the appellant to the respondent’s brother.

29. It remains to consider the challenges to what learned Counsel for the appellant described on the hearing of the appeal as the “discretionary matters”. The challenges to the exercise of discretion by the learned Federal Magistrate are articulated in Ground 6, 7 and 8 of the Notice of Appeal which grounds provide:-

    6.   That His Honour was in error and wrongly exercised his discretion in finding that the overall contributions of the parties should be assessed at 65%/35% in favour of the Wife.

    7. That His Honour was in error and wrongly exercised his discretion in finding that there should be an adjustment under section 75(2) of 5% in favour of the Husband.

    8.   That His Honour was in error and wrongly exercised his discretion in finding that it was just and equitable for the assets (less the debt owing to M Destina) to be divided 60%/40% to the Wife. (Appeal Book, Volume 1, page 3, pars 6 – 8).

30. In the course of his submissions, learned Counsel for the appellant identified what he suggested to be some eight errors by the learned Federal Magistrate. Given that this Court considers the challenge to the learned Federal Magistrate’s finding with respect to the husband’s disputed debt to his brother should succeed the first complaint articulated by learned Counsel for the appellant need not be considered. (see Appeal Book, Volume 1, pages 11 – 13).

31. The balance of the matters complained of, when properly analysed, all involve questions of “weight”. Whilst other findings of fact may have been open to his Honour, nothing raised by learned Counsel for the appellant demonstrates that his Honour’s findings were not reasonably open to him on the evidence. It is not suggested that his Honour either failed to have regard to relevant matters, or had regard to irrelevant matters.

32. The law in relation to challenges of this kind is not in doubt. In Gronow v Gronow (1979) 144 CLR 513, Stephen J said (at 519-20):-

    The constant emphasis of the cases is that before reversal an appellate court must be well satisfied that the primary judge was plainly wrong, his decision being no proper exercise of his judicial discretion. While authority teaches that error in the proper weight to be given to particular matters may justify reversal on appeal, it is also well established that it is never enough that an appellate court, left to itself, would have arrived at a different conclusion. When no error of law or mistake of fact is present, to arrive at a different conclusion which does not of itself justify reversal can be due to little else but a difference of view as to weight: it follows that disagreement only on matters of weight by no means necessarily justifies a reversal of the trial judge. Because of this and because the assessment of weight is particularly liable to be affected by seeing and hearing the parties, which only the trial judge can do, an appellate court should be slow to overturn a primary judge's discretionary decision on grounds which only involve conflicting assessments of matters of weight.

33. In Norbis v Norbis (1986) 161 CLR 513 Brennan J said (at 539 – 540):-

    The difficulties in the way of developing guidelines beset an appellate review of the exercise of discretion under s.79. Unless the primary judge reveals an error in his reasoning, the Full Court can intervene only if the order made is not just and equitable. How does the Full Court arrive at that conclusion? In Bellenden (formerly Satterthwaite) v. Satterthwaite [1948] 1 All ER 343 at p.345 Asquith LJ. stated the rationale of an appellate court’s approach:

    “…It is, of course, not enough for the wife to establish that this court might, or would, have made a different order.  We are here concerned with a judicial discretion, and it is of the essence of such a discretion that on the same evidence two different minds might reach widely different decisions without either being appealable.  It is only where the decision exceeds the generous ambit within which reasonable disagreement is possible, and is, in fact, plainly wrong, that an appellate body is entitled to interfere.”

    The “generous ambit within which reasonable disagreement is possible” is wide indeed when there are a number of factors to be taken into account and the comparative weight to be attributed to those factors is not clearly indicated by uniform standards and values of the community. The generous ambit of reasonable disagreement marks the area of immunity from appellate interference.

34. In AMS & AIF [1999] 199 CLR 160, Kirby J said at 150: -

    [A]n appellate court, invited to review the exercise of discretion at first instance will avoid an overly critical, or pernickety, analysis of the primary judge's reasons, given the large element of judgment, discretion and intuition which is involved [In the Marriage of White [1995] FLC ¶92-648 applying In the Marriage of R [1998] FamCA 108; (1988) 23 Fam LR 456 at 471; In the Marriage of A and J [1995] FLC ¶92-619]. Only if a material error of the kind warranting disturbance of a discretionary decision is established is the appellate court authorised to set aside the primary decision, to substitute its own exercise of discretion or to require that it be re-exercised on a retrial [Gronow v Gronow [1979] HCA 63; (1979) 144 CLR 513 at 519; cf In the Marriage of Skeates-Udy and Skeates [1995] FLC ¶92-626 at 82,294 - 82,295; Moge v Moge (1992) 43 RFL (3rd) 345].

35. Save with respect to one matter to which reference will shortly be made, nothing to which this Court has been referred establishes that his Honour gave undue weight to any of the facts or circumstances complained of, nor has it been established that the learned Federal Magistrate gave insufficient weight to any of those facts or circumstances.

36. As his Honour’s carefully reasoned Judgment makes clear, the facts of the case were somewhat unusual. The wife’s claim at trial was for 70 per cent of the parties’ assets. The learned Federal Magistrate concluded that contributions favoured the wife by 65 per cent and 35 per cent to the husband.

37. Inferentially, and probably necessarily, the applicant’s claim at trial for 70 per cent of the asset pool, as contended by her, represented a contribution based entitlement with no s 75(2) adjustment. It is not without significance that, notwithstanding the facts and circumstances of the case, in an asset pool of only $200 000, the wife’s entitlement was determined at only 5 per cent less than she claimed. Quite apart from the absence of any demonstrated error on the part of the learned Federal Magistrate, that co-incidence is itself strongly supportive of his exercise of discretion being well “within the range”.

38. Nothing to which this Court has been referred establishes a basis for appellate intervention so far as the learned Federal Magistrate’s conclusion with respect to contributions was concerned.

39. It remains to consider the matter which led his Honour to adjust the contribution based entitlements of the parties by 5 per cent in favour of the respondent.

1. It was submitted in that regard:-

   g.His Honour makes a finding that the wife “…has received for her sole use and benefit, in circumstances which could not be categorized as reasonable, part of the proceeds of sale of the unit to which the husband had a legitimate expectation and claim…” (AB 37.3) His Honour was asked not to make a finding of waste but was invited to take the unexplained sum of $39,133.00 into account under section 75(2). His Honour elected to take this course. (AB 35.1). It is submitted that His Honour was in error in doing so.

   h.At best, His Honour was prepared to infer that the wife “…probably used some of those funds for gambling, the amount of which I cannot determine.” (AB 36.8) No finding was made about waste and nor could it have been on the evidence. It is submitted that the inferences that His Honour identified came nowhere near the guidelines identified in cases such as Kowaliw v Kowaliw (1981) FLC 91-092 and provided no justification for an adjustment in favour of the husband under section 75(2)(o). This is particularly the case where the wife was in no position to undertake any analysis of the husband’s spending whilst he was living in the Philippines, earning income as a legal practitioner and on his evidence, borrowing sums from his brother to send to the wife here in Australia. (Appeal Book, Volume 1, page 12, pars 8.g & h).

2. As noted earlier in these Reasons, on the asset pool determined by the learned Federal Magistrate, a 5 per cent s 75(2) adjustment in the respondent’s favour represented approximately $15 000. On the asset pool of $208 000, the effect of the adjustment was to increase the husband’s entitlement by $10 000, creating a disparity of approximately $20 000.

3. The learned Federal Magistrate’s finding that the bulk of the $39 133 received by the wife from the proceeds of sale of the investment property subsequent to separation remained largely unexplained has not been challenged in the appeal, and sensibly so. With respect to learned Counsel for the appellant, that matters not for present purposes. The learned Federal Magistrate was not obliged to make a “finding of waste” as a prerequisite to taking into account the wife’s utilisation of the funds received by her upon the sale of the investment property.

4. It is perhaps ironic, that the thrust of the successful challenge to the learned Federal Magistrate’s conclusion with respect to the disputed loan to the respondent’s brother was based significantly upon the onus of proof. That approach has seemingly been abandoned however where the question of the wife’s receipt and unexplained utilisation of a sum of money which was quite significant relative to the assets and means of the parties is concerned.

5. The appellant bore an evidentiary onus in relation to how she had utilised the $39 133 which she undoubtedly received and controlled. Her evidence in that regard was found to have been unsatisfactory. That finding has not been challenged, and sensibly so. On the evidence before him, it was reasonably open to the learned Federal Magistrate to have notionally added back the bulk of $39 133. Instead, and arguably perhaps generously to the appellant, the learned Federal Magistrate adjusted on a less substantial basis. Nothing to which this Court has been referred establishes that the exercise of discretion in relation to s 75(2) miscarried.

Conclusion

1. The challenge to the learned Federal Magistrate’s finding in relation to the respondent’s alleged indebtedness to his brother having succeeded, the appeal should be allowed, but only in relation to that challenge. The question arises as to what should then occur.

2. Inferentially, the appellant invites the Court to re-exercise the discretion of the learned Federal Magistrate by reference to a net asset pool of $208 000. The appellant’s challenges to the learned Federal Magistrate’s exercise of discretion having failed, and there being no cross-appeal or notice of contention, if this Court were to re-exercise the discretion of the learned Federal Magistrate, that could realistically only be on the basis that the appellant receives 60 per cent of the net asset pool of $208 000 and the respondent receives 40 per cent of such net asset pool.

3. Neither party’s submissions address the question of adducing further evidence for the purpose of the re-exercise of the learned Federal Magistrate’s discretion (see Allesch v Maunz (2000) 203 CLR 172). It can reasonably be inferred that the silence of the appellant results from advice in that respect, and such course is both sensible and understandable. Those assumptions cannot necessarily be made in the case of the respondent, who is unrepresented in the proceedings, has participated solely by written submissions, and has not been expressly asked by the Court whether he wishes to adduce any further evidence. Notwithstanding that, in a perfect world, the finalisation of this appeal might be delayed whilst the respondent is afforded the opportunity to consider whether or not he wishes to adduce further evidence, the Court does not propose so doing.

4. Realistically, the only further evidence which the respondent might seek to adduce on the re-exercise of the learned Federal Magistrate’s discretion would be in relation to the disputed loan to his brother.

5. As this Court’s Reasons for Judgment make clear, the respondent had every opportunity to present the evidence the absence of which has significantly influenced the decision of this Court in relation to the appeal against the learned Federal Magistrate’s finding in that regard.

6. In the continuing absence of any explanation for the failure to seek to rely upon the affidavit evidence of the respondent’s brother, in the circumstances, it would be unfair to the appellant, and impose costs on the appellant which are disproportionate to the amount involved to adjourn the appeal and, potentially, allow the respondent to adduce further evidence with the benefit of this Court’s judgment.

7. Objectively, the respondent had the fullest opportunity, in circumstances which the learned Federal Magistrate so clearly explained, to seek to adduce the evidence in support of his alleged indebtedness, which was available in the form of a sworn, filed and served affidavit of his brother at trial. To allow a further opportunity to do so would not be just and would potentially visit an injustice upon the appellant.

8. The orders of the Court will provide for the deletion from the orders of the learned Federal Magistrate of 10 November 2006 of the provision for payment to the respondent’s brother M Destina of the sum of $51 000 (Order 4b).

Costs

1. Learned Counsel for the appellant sought a costs certificate pursuant to the provisions of s.9 of the Federal Proceedings (Costs) Act 1981 in the event of the Appeal being successful. The circumstances in which the appeal has been successful establishes entitlement to such costs certificate and the Court will order that such a certificate issue to the appellant.

I certify that the preceding one hundred and sixty nine (169) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Coleman

Associate: 

Date:  30 November 2007