DJ AND AJ
[2006] FamCA 961
•4 October 2006
FAMILY COURT OF AUSTRALIA
| DJ AND AJ | [2006] FamCA 961 |
FAMILY LAW – APPEAL – PROPERTY – SUPERANNUATION – Whether having divided the parties’ non-superannuation assets 59% to 41% in favour of the wife on account of contributions to those assets, the Federal Magistrate erred in then making a further 23% adjustment in favour of the wife on account of her contributions to the husband’s superannuation interests or on account of the s 75(2) matters principally being the husband’s greater superannuation entitlements – The husband argued that for s 75(2) purposes his superannuation entitlement now being paid as a pension was also his income stream in circumstances where the wife continued to earn income and had her own superannuation entitlement – The Court emphasised the difference in the nature of the pension income of the husband and earned income of the wife, noting that any income earned by the wife would be as a result of her own efforts without contribution from the husband while the wife had made an indirect contribution to the husband’s indexed pension
FAMILY LAW – APPEAL – PROPERTY – NON-SUPERANNUATION ASSETS - Whether the trial Judge provided adequate reasons for the division of the non-superannuation assets – Whether the trial Judge gave sufficient weight to the financial benefits of the wife’s new relationship
FAMILY LAW – CROSS-APPEAL – PROPERTY – SUPERANNUATION - Whether the Federal Magistrate erred in assessing the contributions of the parties to the superannuation interests – Whether the trial Judge placed insufficient weight upon the value of the husband’s defined benefit superannuation interest
FAMILY LAW – APPEAL – COSTS OF APPEAL
Family Law Act 1975
| Bennett and Bennett (1991) FLC 92-191 |
APPELLANT: DJ
CROSS-APPELLANT: AJ
FILE NUMBER: LNM343 of 2002
APPEAL NUMBER: SA46(i) of 2005
SA 46(ii) of 2005
DATE DELIVERED: 4 October 2006
PLACE DELIVERED: Canberra
JUDGMENT OF: Bryant CJ, Finn and Coleman J
HEARING DATE: 3 October 2005
LOWER COURT JURISDICTION: Federal Magistrates Court
LOWER COURT JUDGMENT DATE: 20 June 2005
LOWER COURT MNC: [2005] FMCA Fam 306
COUNSEL FOR THE APPELLANT: Mr McGuire
SOLICITOR FOR THE APPELLANT: Crisp Hudson & Mann
COUNSEL FOR THE CROSS-APPELLANT: Mr McVeity
SOLICITOR FOR THE CROSS-APPELLANT: McVeity & Associates
Orders
That the appeal be dismissed.
That the cross-appeal be dismissed.
That there be no order for costs in relation to the appeal or the cross-appeal.
| FAMILY COURT OF AUSTRALIA AT HOBART |
APPEAL NUMBER: SA46(i) of 2005; SA 46(ii) of 2005
FILE NUMBER: LNM343 of 2002
| DJ |
Appellant Husband
And
| AJ |
Cross-Appellant Wife
REASONS FOR JUDGMENT
introduction
This is an appeal by the husband and a cross-appeal by the wife against Orders 1, 2 and 7 of orders made by Roberts FM on 20 June 2005 in property settlement proceedings between the husband and the wife. The orders appealed required that the husband transfer his interest in the former matrimonial home to the wife and that he pay her the sum of $10,000.
As drafted, the husband’s grounds of appeal are directed to the adequacy of his Honour’s reasons and to the overall justice and equity of the property settlement award made by him, particularly the adjustment made in the wife’s favour on account of the matters contained in s 75(2) of the Family Law Act 1975 (“the Act”).
However, at the commencement of the hearing of the appeal, Counsel for the husband informed us that the real issue in the appeal was the manner in which his Honour dealt with the parties’ superannuation interests.
Similarly, the grounds of the wife’s cross-appeal are all directed towards the treatment of the superannuation interests.
Before considering further the issues raised by the appeal and the cross-appeal, we will record briefly the factual background as found by his Honour, and also his identification of the assets of the parties and the values of such assets. There was no issue before us regarding any of these matters.
factual background
His Honour found that the husband and the wife (aged nearly 55 and 50 respectively at trial) had married in May 1974 and separated in April 2001. There was thus a cohabitation period of approximately 27 years.
The parties had two surviving adult children who were financially independent.
The husband had worked throughout the marriage as a teacher. But as a consequence of his ill health, he had retired on 19 November 2003. Since that time, he has been in receipt of a pension, paid under the Retirement Benefits Fund of Tasmania (“RBF”). As at 23 June 2004 that pension was $52,146.85 per annum. It is a pension for life and is indexed to movements in the Consumer Price Index twice per year.
The wife worked at a number of jobs throughout the marriage as a secretary, a medical assistant/receptionist and a clerk. At the time of the trial, she was working full-time as a clerk for a Tasmanian Government department, with an income of approximately $40,000 per annum.
Neither party had re-partnered on a full-time cohabitation basis by the time of the trial. However, the wife had for some years been in a relationship with a gentleman in Hobart.
After separation each party had received an inheritance.
the assets and liabilities of the parties
Early in his reasons for judgment, his Honour provided a reasonably detailed and comprehensive analysis of the parties’ superannuation interests and of the case law relevant to such interests, including the decision of the Full Court in Coghlan and Coghlan (2005) FLC 93-22. Apparently in light of the observations of the majority in Coghlan (supra), his Honour then divided the assets of the parties into superannuation and non-superannuation assets, or perhaps more correctly, interests.
His Honour found the non-superannuation assets of the parties to be as follows (paragraph 57 of his judgment):
Former matrimonial home $180,000
Husband’s motor vehicle $23,950
Wife’s motor vehicle $13,850
Furniture and contents $7,000
Boat$4,500
Wife’s inheritance (approx) $135,000
Husband’s inheritance $64,700
Gross total$429,000
His Honour then found the liabilities which were to be taken into account to be as follows (paragraph 62 of his judgment):
Wife’s car loan $17,000
Husband’s car loan $8,179
Loan from husband’s mother $13,000
Wife’s credit card loan $10,000
Total $48,179
Accordingly, his Honour concluded (at paragraph 63 of his judgment) that the net value of the non-superannuation assets of the parties was $380,821.
So far as the parties’ superannuation interests were concerned, his Honour had in his earlier discussion concerning those interests and the relevant law, made the following findings:
34.The Wife’s RBF superannuation interest is a defined benefit interest in the growth phase. When her interest is valued in accordance with the complicated formula provided for in Regulation 29 and Schedule 2 of the Regulations, using the information provided by RBF and based upon a benefit payable as a combination of lump sum and pension (where there is no restriction upon the maximum percentage taken as a lump sum), the valuation at the 10th October 2003 is calculated to be $45,169.53.
35.The Husband has two superannuation interests with RBF. The less valuable of the two is an accumulation interest in the growth phase. That interest, valued in accordance with Regulation 31(2A) of the Regulations based upon the information provided by RBF, was worth $14,157.20 at 23rd June 2004. The proceeds of that accumulation fund will become available to the Husband when he turns 55 on 16th August 2005.
36.The Husband’s more valuable superannuation interest is his entitlement to a defined benefit which is already in the payment phase. At 23rd June 2004 he was receiving $52,146.85 as an annual pension. The valuation of that interest pursuant to another complicated formula pursuant to Regulation 42(2B) and Schedule 4 of the Regulations is $864,775.31 as at 23rd June 2004.
37.It can be seen from the last paragraph that the valuation of a defined benefit superannuation interest in the payment phase can result in a very high value that has an artificial quality to it. In this particular case, because the Husband no longer has an option to take his pension as a lump sum, it is quite clear that there is no such capital sum of $864,775.31 available to be divided between the parties. Consequently, a splitting order in relation to that particular superannuation interest cannot result in the payment of a lump sum to the Wife.
38.The artificial nature of the valuation of the Husband’s defined benefit superannuation interest can be seen from the fact that, when valued in the growth phase at 10th October 2003, the value was $407,096.48, but when value in the payment phase eight months later, the value was $864,775.31. Clearly, there was no massive injection of capital to make it more than double its value. The only significant factor that has apparently contributed to this massive increase in value was the Husband’s retirement on health grounds.
Then later after making his findings concerning the non-superannuation assets and liabilities of the parties, his Honour provided the following summary of the parties’ superannuation interests (paragraph 64 of his judgment):
Wife’s superannuation $45,170
Husband’s accumulation fund $14,157
Husband’s pension entitlement $864,775
the contribution assessments
Having made his findings concerning the values of the non-superannuation assets and of the superannuation interests, his Honour proceeded to consider the parties’ contributions first to their non-superannuation assets and then to their superannuation interests.
In relation to their contributions to their non-superannuation assets, his Honour concluded (at paragraph 67 of his judgment) that the husband’s contributions should be assessed at 41 per cent and the wife’s at 59 per cent. His Honour observed that the “differential is entirely explained by the greater value of the wife’s inheritance”.
As there is no challenge in the appeal or the cross-appeal specifically directed to his Honour’s assessment of the parties’ contributions to their non-superannuation assets, it is unnecessary that we say more regarding that assessment.
In relation to the parties’ contributions to their superannuation interests, his Honour ultimately concluded:
73.Because of the lack of information available to me about contributions towards superannuation, I am only able to conclude that the Husband’s direct and indirect contributions to superannuation were greater than those of the Wife. While it is difficult to quantify how much greater his contributions were, I assess the overall contributions towards superannuation generally in the order of sixty per cent by the Husband and forty per cent by the Wife.
As this assessment of contributions to the superannuation interests is challenged by the wife in her cross-appeal (but not by the husband in his appeal), we will return to this matter in due course.
the s 75(2) factors and the final orders
Under the heading “Section 75(2) Factors” his Honour made the following findings:
74.… the Wife is currently aged fifty years and she is earning approximately $40,000 per annum. The Husband is aged fifty five years and he is in receipt of an indexed pension that is in excess of $52,000 per annum.
75.There are no apparent factors that would cause the Wife to seek early retirement. On the other hand, the Husband has been required to retire because of his health. The medical evidence is that the Husband is not able to return to work in his chosen profession. However, he has had some casual part-time work.... I conclude that that employment is of little overall value.
76.Neither party has the care or control of a child of the marriage under the age of eighteen years, or any responsibility or duty to maintain or support any other person.
77.It is clear that on their current incomes, each party is able to maintain himself or herself adequately.
78.Although the Husband’s counsel attempted to persuade me that there was some economic significance in the relationship between the Wife and the gentlemen [referred to … above], there was no evidence put before me that the relationship was anything other than a boyfriend/girlfriend relationship as suggested by the Wife when she was cross-examined.
Then under the heading “Conclusions” his Honour continued:
79.Having considered the factors set out above, I am still left with the artificial nature of the value of the Husband’s superannuation. In my view, the difficulty for the Court is in the fact that the valuation of his superannuation is essentially a valuation of an income stream whereas there is no “valuation” before the Court of the Wife’s income stream. She is currently employed, earning approximately $40,000 per annum and if she works at that rate of pay until she is sixty five years old, she will gross $600,000. That is not a valuation of her income stream, but it does illustrate the inherent unfairness of valuing one party’s income stream while not valuing the income stream of the other party.
80.Clearly, this is a factor that must be taken into account under Section 79(2) of the Act.
81.When I weigh up all of these factors, I am of the view that a just and equitable settlement is as follows:
a)That the Husband transfer his interest in the former matrimonial home to the Wife
b)That the Husband retain his motor vehicle, boat and chattels
c)That the Wife be responsible for payment of her car loan and credit card debt
d)That the Husband be responsible for payment of his car loan and any loan debt owing to his mother
e)That on or before 16th September 2005 the Husband pay to the Wife the sum of $10,000.
82.By my calculation this would provide the Wife with non-superannuation assets with a net value of $311,850 and the Husband $68,970. This means that the non-superannuation assets would be divided on a basis of eighty two per cent to the Wife and eighteen per cent to the Husband. In my view, this takes account of the parties’ contributions and the significantly greater value of the Husband’s superannuation.
His Honour then explained in paragraph 83, his reasons for not making a splitting order in relation to the superannuation interests, even though both parties had sought such an order in relation to the husband’s RBF defined benefit interest. As no complaint was made before us concerning his Honour’s decision in this regard, we say no more regarding his decision not to make a splitting order.
Finally before concluding that his proposed orders were just and equitable, his Honour made the following comments regarding the husband’s need for housing and regarding the source from which the husband could pay a cash adjustment to the wife:
84.I have deliberately not made orders for the sale of the former matrimonial home, even though I was informed that neither party wishes to retain it. By transferring the home to the Wife, she will be able to decide upon how it should be marketed and sold. In my view, there is little point in involving the Husband in that exercise, when he has no financial interest in the outcome. It is quite clear that the Husband is financially capable of obtaining rented accommodation from his income of more than $52,000 per annum, but it may take some time for him to find suitable rental accommodation. Consequently, he will be required to vacate the property within sixty days and he must keep it in good order and condition in the interim.
85.The order requiring the Husband to pay $10,000 to the Wife may need to be paid from the superannuation accumulation interest that will become available to him on 15th August 2005. Naturally, there will be administrative requirements in relation to the release of those funds, so I will require him to pay that sum by 16th September 2005.
86.In my view, the orders that I propose are just and equitable in all the circumstances.
the issues raised by the husband’s appeal
The principal complaint made by the husband in his appeal (Grounds 2, 3, 4 and 6) is that while his Honour had correctly divided the assets into superannuation interests and non-superannuation assets and had correctly determined the parties’ differing contributions to each of those categories of assets or interests, he had then erred in making an adjustment of at least 23 per cent in the wife’s favour on account of s 75(2) factors. Such an adjustment was said to be “manifestly excessive” having regard to:
·the earning capacities of the parties;
·their existing superannuation entitlements (exclusive of the husband’s RBF pension);
·the wife’s ability to continue to superannuate herself and the fact of her new relationship; and
·the husband’s health and inability to further superannuate himself.
It was also asserted (Ground 5) that his Honour’s reasons were inadequate to explain the 82 per cent – 18 per cent division of the non-superannuation assets which he made in the wife’s favour.
A further discrete complaint (Ground 1) concerned the weight which his Honour gave to the financial benefits of the wife’s new relationship.
the adequacy of the reasons
In order to determine if there is substance in the husband’s complaint concerning the adequacy of his Honour’s reasoning, it is necessary to consider closely that reasoning as it emerges from his judgment.
In our view, there could be no difficulty in understanding his Honour’s reasoning and calculations up to and including the point in his judgment where he reached his conclusions concerning the parties’ respective contributions both to their non-superannuation assets and to their superannuation interests. In fact, apart from the wife’s complaint regarding the weight given to her contributions to the superannuation interests, neither party asserts any difficulty with his Honour’s judgment to this point.
It is useful for purposes of this discussion to note at this stage that a 59 per cent to 41 per cent division of the net value of the non-superannuation assets of $380,820 (on the basis of the parties’ contributions to those assets) would result in an entitlement to the wife of assets to the value of $224,684 and to the husband of assets to the value of $156,136. These figures clearly formed the basis of his Honour’s further calculation of the parties’ entitlements.
Then, having canvassed in paragraphs 74 to 79 of his judgment (see paragraphs 23 and 24 of this judgment) the s 75(2) matters that could be relevant in this case, his Honour concluded in paragraph 81 that “a just and equitable settlement” would be achieved if the husband transferred his interest in the former matrimonial home and paid the wife the sum of $10,000; if the husband retained his car, boat and chattels; if the wife was responsible for her car loan and credit card debt; and the husband was responsible for his car loan and any debt to his mother.
His Honour then explained in the immediately following paragraph 82, that this division would result in the wife having non-superannuation assets to the value of $311,850 and the husband assets of $68,970, which according to his Honour would be an 82 per cent/ 18 per cent division of those assets.
It is important to note that his Honour then stated that “this [division] takes account of the parties’ contributions and the significantly greater value of the husband’s superannuation”. We understand this reference by his Honour to the parties’ “contributions” as a reference to their contributions as previously found by him both in relation to their non-superannuation assets and to their superannuation interests.
In relation to the challenge to the adequacy of his Honour’s reasons, we as an appeal court certainly have no difficulty in understanding how and why his Honour arrived at his ultimate determination as is required by the test for adequacy of reasons as formulated in Bennett and Bennett (1991) FLC 92-191.
Put simply, his Honour gave the wife an additional 23 per cent of the non-superannuation assets (that is, the difference between the final 82 per cent awarded to her and the 59 per cent awarded to her for her contributions to the non-superannuation assets) on account of her contributions to the husband’s superannuation interests and on account of the s 75(2) matters, including principally the greater value of the husband’s superannuation entitlements.
Notwithstanding the conclusion we have just reached concerning the overall adequacy of his Honour’s reasons, we consider that we should address certain specific matters raised as part of the husband’s challenge to the adequacy of his Honour’s reasons.
First, it was submitted on behalf of the husband that paragraph 81 of his Honour’s judgment “did not logically or explicably connect and/ or relate the Orders made in respect of the preceding statements of law and fact”. (Paragraph 81 appears at paragraph 24 of this judgment).
To the extent that we understand exactly what is meant by this submission, we would observe that there is no obligation on a trial Judge or Magistrate to express in percentage terms the adjustment that he or she proposes to make on account of the s 75(2) matters. This adjustment can be made by reference to the transfer or retention of assets and/ or a sum of money. This, in our understanding, was the approach which his Honour adopted, and it was certainly an approach open to him.
His Honour then proceeded, as it might be expected he would, to set out in paragraph 82 (again see paragraph 24 above) in monetary amounts the value of each parties’ ultimate entitlement, and to express that entitlement in percentage terms.
His Honour did not expressly state in these concluding paragraphs of his judgment that each party would retain his or her own superannuation interests. But that fact is, in our view, implicit in his reasons, subject of course to what he said in paragraph 85 of his judgment (see paragraph 26 above) concerning the possibility that the husband might need to use part of his superannuation accumulation interest to pay the wife the required sum of $10,000.
To the extent that it might be said that his Honour did not explain why the husband had to pay the wife precise sum of $10,000, we suggest that that question would be unlikely to be asked had his Honour adopted the more usual approach by saying at the conclusion of his consideration of the s 75(2) matters, that he proposed to make a 23 per cent adjustment in favour of the wife on account of those matters (and of her contributions to the husband’s superannuation interests), and then set out the assets to be received or retained and any necessary cash adjustment required to be made.
We thus conclude that there is no merit in the challenge to the adequacy of his Honour’s reasons.
the justice and equity of the s 75(2) adjustment and of the overall award
The essential basis for the husband’s assertion that his Honour’s s 75(2) adjustment in the wife’s favour on account of the husband’s RBF deferred benefit superannuation entitlement (and hence his overall award) was “manifestly excessive”, appeared to be that his Honour had failed to take into account that the husband’s RBT pension entitlement was also his “income stream” in circumstances where the wife is continuing to earn income and has her own superannuation entitlement which will continue to increase because of her employment.
However, with respect, this argument overlooks the following important considerations. The first is that the wife has to work and remain working in order to obtain her income, while the husband will receive his indexed pension for life regardless of any other circumstance. As was said by Counsel for the wife in his written submissions:
4.…a large guaranteed life pension that makes no calls on the time, labour or lifestyle of its recipient is not comparable with a lesser present income subject not only to life’s usual contingencies but calling on all the time, labour and lifestyle sacrifices demanded of any employment.
But perhaps more importantly, the nature of the "income" is different. Any income the wife will earn in the future is simply that, income earned by her own efforts without any contribution from the husband. In comparison, the husband’s "income stream" is a defined benefit superannuation interest now being paid as an indexed pension which has a value attributed to it by the Regulations of $864,775.31, to which the wife has during the years of the marriage made an indirect contribution by virtue of the matters in s 79(4) of the Act.
These two considerations also dispose of any suggestion that by making the further adjustment in the wife’s favour (beyond the 59 per cent which she received on account of her contributions to the non-superannuation assets) to cover both her contributions to the husband’s superannuation interest and his superior position in relation to superannuation (as indeed is evidenced by the value of the parties’ superannuation interests), his Honour in someway double-counted. The wife was entitled to receive in the ultimate division of the parties’ property, recognition both for her contributions during the years of the marriage to the husband’s superannuation interests, and for the fact that the husband is now receiving for life a substantial income without the necessity to work while the wife has to continue to work to achieve a comparable income.
When these considerations are borne in mind, the award to the wife cannot be said to be “manifestly excessive”. In our view, it was well within a reasonable exercise of the discretion, and as we suggested at the hearing of the appeal, may well be generous to the husband.
It will be convenient at this point to consider the wife’s cross-appeal, given that it is also directed to his Honour’s treatment of the husband’s defined benefit superannuation interest.
the wife’s cross-appeal
In her cross appeal, the wife asserts that his Honour erred:
·in finding (at paragraph 70 of his reasons for judgment) that the wife had done nothing to contribute to the significant increase in the value of the superannuation of the husband’s defined benefit superannuation interest (Ground 1);
·in assessing (at paragraph 73 of his reasons for judgment) the overall contributions towards superannuation generally in the order of 60 per cent by the husband and 40 per cent by the wife (Ground 2); and
·by placing too little weight upon the value of the husband’s defined benefit superannuation interest (Ground 3).
His Honour’s findings which are particularly relevant to the grounds of the wife’s cross-appeal are to be found in paragraphs 69 to 73 of his judgment. But in order to understand those paragraphs, it is also necessary to have regard to paragraph 38 of his judgment (which we have earlier set out, but here repeat):
38.The artificial nature of the valuation of the Husband’s defined benefit superannuation interest can be seen from the fact that, when valued in the growth phase at 10th October 2003, the value was $407,096.48, but when value in the payment phase eight months later, the value was $864,775.31. Clearly, there was no massive injection of capital to make it more than double its value. The only significant factor that has apparently contributed to this massive increase in value was the Husband’s retirement on health grounds.
…
69.In this matter I was not really provided with much information about contributions to the parties’ superannuation interests. However, the Superannuation Information Form provided by RBF in relation to the Husband’s defined benefit interest as at 10th October 2003 shows that he became a member of that superannuation fund on 1st January 1968. As can be seen from paragraph 9 above, the parties did not cohabit until May 1974, so it seems clear that the Wife could not claim any contribution towards that superannuation interest in relation to the six years prior to cohabitation. However, it is also unlikely that the Husband would have accrued much of an entitlement to superannuation during those first six years.
70.It is also clear that the Wife has done nothing to contribute the significant increase in the value of the superannuation interest that is referred to at paragraph 38 above.
71.The Husband made direct and indirect contributions to his superannuation (either by financial contributions or simply by being employed) from 1968 until the date of his retirement. The Wife’s contributions would have been as a homemaker and parent. Her contributions in that regard, especially when the children were young, would have enabled the Husband to continue working on a full-time basis.
72.The Wife’s Superannuation Information Form shows that she became a member of the Fund on 19th May 1994, so she would have made similar direct and indirect contributions to that interest from that date until the information was provided on 10th October 2003. I assume that those contributions are continuing.
73.Because of the lack of information available to me about contributions towards superannuation, I am only able to conclude that the Husband’s direct and indirect contributions to superannuation were greater than those of the Wife. While it is difficult to quantify how much greater his contributions were, I assess the overall contributions towards superannuation generally in the order of sixty per cent by the Husband and forty per cent by the Wife.
The written submissions on behalf of the wife in support of the first two grounds of her cross-appeal were as follows:
1.It is submitted that there was simply no basis for a finding that the contributions of the husband to superannuation were greater than those of the wife.
2.In every other respect contributions to the non inheritance assets were assessed as equal as might be expected in a long term marriage and despite futile attempts by the Appellant at hearing to raise specious contribution arguments (Paragraphs 8 – 21 and 65).
3.It is submitted that paragraph 70 is plainly wrong. The wife “did nothing” to contribute to the growth in the value of the superannuation interest only in the same sense that the husband “did nothing” to effect the increase either. The simple fact is that the recent of [sic] growth of the fund is attributable solely to the fact that the fund was a long term fund that persisted throughout the marriage when both parties contributed to it (albeit that the wife’s contribution was indirect).
4.Despite a finding (or admission) that “it is unlikely that the husband would have accrued much of an entitlement to superannuation during those first six years” (paragraph 69). The conclusion drawn by His Honour must entail that it was this that permitted a shift of 10% in favour of the husband over superannuation generally (paragraph 73). It is submitted that this is plainly wrong.
5.It is submitted this Honourable Court ought to substitute a finding of equality of contribution save in relation to post co-habitation inheritances.
We consider that there is some force in the submission made in paragraph 3 of the above submissions, being, in effect, that the growth in the fund could be sourced to the nature of the fund and the contributions made throughout the marriage by both parties. There is also some force in the submission in paragraph 4, being that his Honour appears to indicate that he would place little weight on the husband’s first six years of membership of the fund.
On balance, however, we would not be prepared to interfere with his Honour’s decision on account of these matters. This is for two reasons.
First, it has to be remembered that the parties separated in April 2001 but the husband continued to work and thus contribute to his superannuation fund until November 2003. Secondly, and perhaps more significantly, as his Honour observed at paragraph 69 and again at paragraph 73, he was provided with little information about the parties’ contributions to their superannuation interests. We can only conclude that his Honour made the best assessment he could on the limited material before him. We would be in no better position than his Honour.
As we said earlier when considering the husband’s appeal, an adjustment of 10 per cent in the husband’s favour on account of his contributions to the superannuation interests may have been somewhat generous to him. However, on the material before his Honour and before us, that adjustment cannot be said to be beyond a proper exercise of the discretion.
the financial circumstances of the wife’s new relationship
Finally, we return to the somewhat discrete complaint made by the husband in his first ground of appeal. That complaint is that having found that the wife had for some years been in a relationship with a gentleman in Hobart, his Honour had then erred in failing to take into account the financial benefit to the wife of that relationship. It was also submitted on behalf of the husband that his Honour had erred “in not making a negative inference against the wife in failing to bring evidence from her partner as to his income, assets and work capacity, given that the wife was on notice from the husband’s affidavit material as to this being an issue before the Court”. In support of this submission, reliance was placed on the decision in Jones v Dunkel (1959) 101 CLR 298.
However, this complaint overlooks, with respect, the fact that the relevant paragraph of s 75(2) requires that in order for the financial circumstances of a new partner of one of the parties to property settlement proceedings to be taken into account, there needs to be cohabitation between that party and the new partner. The exact terms of s 75(2) (m) are:
If either party is cohabiting with another person – the financial circumstances relating to the cohabitation.
The effect of his Honour’s finding concerning the wife’s new relationship was that there was no cohabitation between the wife and her new partner. The precise terms of his finding regarding the matter is as follows:
28.Neither party had re-partnered on a full-time cohabitation basis by the time of the hearing. However, it was clear that the Wife was in a relationship with a gentleman in Hobart and that relationship had been continuing for some years. I shall refer to this again below.
Later in paragraph 78 of his judgment, his Honour referred to this matter, saying:
78.Although the Husband’s counsel attempted to persuade me that there was some economic significance in the relationship between the Wife and the gentlemen referred to in paragraph 28 above, there was no evidence put before me that the relationship was anything other than a boyfriend/girlfriend relationship as suggested by the Wife when she was cross-examined.
We did not understand the husband to challenge these findings of fact by his Honour. But in the event that we have misunderstood the husband’s case in this regard, we would say that his Honour’s findings were clearly open to him in light of the lengthy and exhaustive cross-examination of the wife regarding her new relationship (see Transcript 26/2/04, p171-176).
Given the conclusions which we have reached regarding that matter, it is unnecessary that we address the submission supposedly based on the principle in Jones v Dunkel (supra).
conclusion in relation to the appeal and the cross-appeal
For the reasons we have given both the appeal and the cross-appeal must be dismissed.
costs of the appeal and the cross-appeal
At the conclusion of the hearing before us, we invited and received submissions in relation to the costs of the appeal and the cross-appeal.
In the event that the appeal failed, the wife sought a costs order in her favour. The husband resisted such an order on the basis of the relative financial circumstances of the parties and also the merits of the issues raised by the appeal.
We are of the view that there are no circumstances which would justify the making of any order for costs in relation to either the appeal of the cross-appeal.
I certify that the preceding sixty-seven (67) paragraphs are a true copy of the reasons for judgment of this Honourable Full Court
Associate:
Date:
Key Legal Topics
Areas of Law
-
Family Law
-
Equity & Trusts
Legal Concepts
-
Remedies
-
Statutory Construction
-
Appeal
-
Costs
2