Dodge and Meldrum

[2010] FMCAfam 119

FEDERAL MAGISTRATES COURT OF AUSTRALIA

DODGE & MELDRUM [2010] FMCAfam 119

FAMILY LAW – Property – short marriage of three years in duration – no children – wife in debt at commencement of relationship – husband has made overwhelmingly superior financial contributions – assessment of other contributions – whether global approach or asset by asset approach should be taken – assessment of homemaking contributions in context of parties living overseas during the marriage – s.75(2) factors – just and equitable.

Family Law Act 1975, ss.79(4), 75(2)

Lee Steere v Lee Steere (1998) FLC 91-626
Ferraro v Ferraro (1993) FLC 92-355
Clauson v Clauson (1995) FLC 92-595
Hickey v Hickey & Attorney-General of the Commonwealth of Australia (Intervenor) (2003) FLC 93-143;
Biltoft & Biltoft (1995) FLC 92-614
Russell v Russell (1999) FamCA 187
Waters & Jurek (1995) FLC 92-635
Kennon & Kennon (1997) FLC 92-757
NHC & RCH (2004) FLC 93-204
Norbis v Norbis (1986) FLC 91-712
McMahon & McMahon (1995)FLC 92-606
Ferraro & Ferraro (1992) 16 Fam LR 1
Quinn & Quinn (1979) FLC 90-677
Bushby v Bushby (1998) FLC 91-919
Pierce & Pierce (1999) FLC 92-844
Robb & Robb (1995) FLC 92-555

Applicant: MS DODGE

Respondent: MR MELDRUM

File Number: NCC 122 of 2008

Judgment of: Brown FM

Hearing date: 2 September 2009

Date of Last Submission: 26 January 2010

Delivered at: Adelaide

Delivered on: 19 February 2010

REPRESENTATION

Counsel for the Applicant: Mr McQuade

Solicitors for the Applicant: All Family Law

Counsel for the Respondent: Mr Duane

Solicitors for the Respondent: Gianacas Argiris McDonald

ORDERS

In full and final settlement of all claims for the settlement of matrimonial property:

1. Within twenty-eight days of the date of these orders the husband pay to the wife the sum of $20,000.00.

2. The wife is declared to be the owner of the BMW motor vehicle currently in her possession.

3. Each party be solely entitled to the exclusion of the other to all properties and chattels of whatsoever nature and kind in the possession of such party as at the date of the making of these orders and for that purpose bank accounts are deemed to be in the possession of the person whose name appears on the bank’s records thereof, insurance policies and superannuation entitlements are deemed to be in the possession of the beneficiary thereof. 

4. The applications be otherwise dismissed.

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

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
ADELAIDE

NCC 122 of 2008

MS DODGE

Applicant

And

MR MELDRUM

Respondent

REASONS FOR JUDGMENT

Introduction

1. These reasons for judgment relate to the settlement of matrimonial property.  The applicant in the proceedings is Ms Dodge “the wife”.  The respondent is Mr Meldrum “the husband”. 

2. The parties met in [W], at some time in mid-2004.  At the time, the husband, who is [employed in the building industry], had been contracted to work for [B], in [W], for a period of around eight months. The wife was then employed, [in the hospitality industry], in [W].

3. The husband’s base, in Australia, is in the Newcastle area of New South Wales.  However, his work has taken him around the world, particularly to South Asia.  He enjoys the expatriate lifestyle and has been well paid, in the past, for his work. 

4. The parties had a whirlwind romance.  They began to live together a few months after they met.  They married in the Cook Islands, [in] 2004.

5. It is common ground between the parties that they finally separated on 10 January 2007, when the wife left a house, owned by the husband, in Newcastle.  Accordingly, the relationship between the parties is one of less than three years in duration.  It produced no children.

6. Both parties had been previously married and divorced. Both have children from their earlier relationships. During their marriage, the parties lived overseas in Vietnam, China and Thailand. The husband was employed during these periods. The wife was not. It was a condition of her entry to the various countries involved that she not seek paid employment.

7. It is the husband’s case that his significant income, during the parties’ marriage, provided the parties with a comfortable expatriate lifestyle in each of the countries concerned.  As a result the wife had to provide very little in the way of home duties and housekeeping.

8. In addition, the husband points to the fact that he came into the marriage with a significant level of asset backing.  He owned houses in [W] and [M], a suburb of Newcastle.  He had around $47,000.00 in accrued superannuation and significant savings. 

9. On the other hand, he deposes that the wife was in a parlous financial position, as a result of the end of her earlier marriage.  Essentially, the wife was in a position where her liabilities exceeded the value of her assets, to a marked degree.

10. As such, the husband contends that his direct financial contributions, during the marriage, have been overwhelmingly superior to those of the wife.  It is therefore his position that, at the end of the parties’ short marriage, the court should make orders endorsing the parties’ current financial situation – that is each party should retain the assets and financial resources currently under each parties’ control. 

11. The wife does not agree.  It is her case that she made significant indirect and homemaking contributions during the parties’ marriage.  In particular, it is her case that she assisted in renovating the husband’s two real properties in [W] and [M], during periods the parties were in Australia. 

12. In addition, she asserts that she provided significant support to the husband, during the period the couple were living overseas.  For various reasons, these contributions were made in difficult and arduous circumstances.  The wife contends that, if she had not accompanied him, the husband would not have sought employment overseas and so would not have been able to earn the large salaries, which he did. 

13. As such, the wife’s case is that although her contributions may not have directly resulted in the acquisition of material assets, these contributions should be regarded by the court as being generally equivalent to those of the husband. 

14. Accordingly, it is the wife’s case that it would be fundamentally unfair to her, if the court makes orders which result in the maintenance of the parties’ current financial status quo. This would leave her with practically no financial backing and a far more limited capacity to earn an income in future than the husband. 

15. In these circumstances, the wife seeks a settlement of property, from the husband, which would result in the payment to her of the sum of $137,500.00, which represents 42.5% of the parties’ asset pool, as she calculates it. 

16. In opposition to this course, the husband points to the fact of the parties’ short marriage which, on his case, provided the wife with significant benefits.  In particular, he extinguished the debts, which the wife brought into the marriage and gifted her jewellery and other items.  In all these circumstances, he contends that an outcome, which leaves the parties in essentially the same position, as when they began their marriage, would not be an inequitable result. 

17. Accordingly, the husband is in vehement opposition to any outcome, which would result in him having to pay the wife any specific sum of money.  During the marriage, a BMW motor vehicle was purchased for the wife. Its value is controversial but it is somewhere between $10,000.00 and $23,000.00. 

18. It is the husband’s case that the wife’s retention of this motor vehicle and some other items of personal property represents a fair outcome in this case, particularly bearing in mind the wife’s level of indebtedness at the commencement of the parties’ relationship. 

19. These proceedings are designed to resolve the various disputes between the parties and, as far as possible, finalise their financial relationship with one another. 

The application legal principles

1. The process to be followed, for the division of the parties’ property, is well established by law.[1] The relevant legal principles are primarily contained in sections 79 and 75(2) of the Family Law Act 1975.  I am required to follow a four step process. 

   [1] See Lee Steere v Lee Steere (1998) FLC 91-626; Ferraro v Ferraro (1993) FLC 92-355; Clauson v Clauson (1995) FLC 92-595; Hickey v Hickey &Attorney-General of the Commonwealth of Australia (Intervenor) (2003) FLC 93-143;

2. In the first step, I must ascertain what are the parties’ assets and liabilities as at the date of trial.[2] 

   [2] See Biltoft & Biltoft  (1995) FLC 92-614

3. The second step involves the court ascertaining the contributions which each party has made towards those assets.  Contributions fall into two broad categories. 

4. The first kind is contributions to the property: financial contributions and non-financial contributions, made directly or indirectly, by or on behalf of a party to the marriage to the acquisition, conservation or improvement of any of the property.  

5. The second kind is contributions to the welfare of the family: in the words of the section, “the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage, including any contribution made in the capacity of home maker or parent.”[3] 

   [3] See Family Law Act s.79(4)(c)

6. It is clear from the authorities that this second kind of contribution must be given appropriate weight and is not to be treated as a token matter or as a contribution which is inherently less valuable or important than a financial contribution to property.

7. The third step involves the assessment of the parties’ prospective needs, by reference to the factors set out in section 75(2) of the Family Law Act 1975. Pursuant to section 75(2)(o), the Court is entitled to take into account “any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account”. 

8. Finally in determining what order the court should make under section 79, the court must be satisfied that in all the circumstances, it is just and equitable to make the relevant orders. Overall, it is the justice and equity of the actual orders that the court must consider.[4]  Accordingly, the fourth step is for the court to take a step back and examine whether the orders it proposes are just and equitable. 

   [4]  See Russell v Russell (1999) FamCA 187

9. The “overriding requirement” of section 79 is that considerations of justice and equity should inform each step of the process. The exercise I must undertake is not a “process of social engineering”[5] or of equalisation of assets or financial resources.

   [5]  See Waters & Jurek (1995) FLC 92-635

10. At the outset, I am at pains to point out to the parties that the task I must undertake is not a simple accounting or arithmetical task.  In the jargon of the times, I cannot “crunch the numbers” to come up with a division of their property, which is not open to challenge or incapable of different interpretation. 

11. The task, set out for me in this case, requires me to balance and compare contributions which are by their nature different, within the framework of a marriage.  Many contributions in a marriage, such as being a homemaker, do not result in the direct acquisition of assets.  They are also difficult to value.  The discretion I have is a wide one. 

The documents relied upon

1. The wife is the applicant in these proceedings, which she began on 14 October 2008.  In her application, she sought that “there be an equitable division of property between the parties”.  On an interim basis, she sought to restrain the husband from selling his [W] house. 

2. In her case outline document, the wife has refined the property orders, which she seeks.  As previously indicated, she seeks that the husband pay her the sum of $137,500.00 within twenty-eight days and that otherwise each party should retain assets currently within their respective possession. 

3. In support of her position, the wife relies on the following documents:

   i)An affidavit of herself filed 6 August 2009;

   ii)A statement financial circumstances of herself filed 6 August 2009;

   iii)An affidavit of her father, Mr H filed 20 August 2009; and

   iv)An affidavit of Ms G filed 6 August 2009.

4. The husband responded to the wife’s application on 17 November 2008.  He seeks orders that would result in the formal transfer to the wife of the BMW motor vehicle, currently in her possession.  Otherwise, he seeks an order in the nature of a declaration that each party be declared to be the owner of all items of property, including superannuation entitlements, currently in their respective possession.  As previously indicated, this remains the husband’s position at the current time. 

5. In support of his position, the husband relies on the following documents:

   i)Two affidavits of himself filed on 17 November 2008 and 24 August 2009;

   ii)A statement of his financial circumstances filed 24 August 2009; and

   iii)An affidavit of Mr C filed 25 August 2009.

The issues

1. Before turning to the relevant evidence in detail, it is useful to set out the major factual issues in dispute between the parties in brief form. 

   ·What was each party’s financial position, when they commenced their relationship.

   ·What were each party’s contributions to the renovations and repairs to the husband’s property situated at Property M “the Property M property”.

   ·The wife asserts that she did a great deal of work on the property in October/November of 2004 and afterwards during the parties’ periodic visits to Australia, which was necessary to bring it up to a habitable standard and later for it to be sold at a profit.

   ·The husband says that he and Mr C did the vast bulk of the work and, as such, the profit realised is due to his and Mr C’s efforts, which followed the investment of their capital.

   ·The husband purchased a house at Property W, [W] in September of 2004.  It was intended to be an investment property. 

   ·The husband contends that the wife made no contributions towards its purchase or upkeep whatsoever and neither he nor she has ever lived in it.

   ·

   On the other hand, the wife contends that she and her father,

   
   

   Mr H, a [tradesman] worked extensively on the property so that it could be successfully rented. 

   ·What was the nature of the parties’ relationship during their marriage. 

   ·In particular, was it a violent and abusive relationship, as the wife contends, such that she was the victim of significant and endemic family violence from the husband. 

   ·Has this situation resulted in the wife’s various contributions being made in particularly arduous circumstances, which the court should now take into account in its assessment of those contributions.[6] 

   [6]  See Kennon & Kennon (1997) FLC 92-757

   ·In this context, what were the homemaking contributions of the wife.

   ·Did she lead a life of leisure in Vietnam, China and Thailand, as the husband contends, because the parties led a comfortable expatriate lifestyle, where paid employees performed most of the necessary household tasks. 

   ·On the other hand, did the wife regularly shop, cook and clean, whilst the parties were overseas, activities which were made significantly difficult for the wife because she was living in foreign and unfamiliar circumstances. 

   ·What are the implications, if any, of the parties’ expatriate lifestyle for the assessment of their various contributions made during the marriage. 

   ·The husband contends that he paid for clothes, electronic items and jewellery for the wife and for holidays both for the wife, her friends and children.

   ·In addition the husband contends that he paid education and living expenses for the wife’s son [X].

   ·The husband calculates that he has contributed around $70,000.00 in items which have solely benefitted the wife.

   ·What is the relevance of the wife having undergone breast enlargement surgery in Thailand. 

   ·The wife asserts she underwent the surgery, at the husband’s sole instigations and endured considerable pain and suffering as a result.  It is her case that this is a form of contribution made by her. 

   ·The husband does not agree.  It is his case that the wife happily underwent the surgery, which he paid for and, as such, the issue has no relevance in these proceedings, other than that the husband asserts that he has provided some form of benefit to the wife. 

   ·The parties are in dispute as to contributions which each has provided to the other in respect of the provision of care and financial support to the other’s children. 

   ·What is the extent and relevance of monies utilised by the wife after separation.

   ·The parties are in vehement dispute, regarding how their prospective needs should be assessed and catered for in the orders of the court finalising these proceedings. 

   ·The wife points to the fact that she is a person in her mid-forties, who has limited skills and qualifications.  As such, her future financial prospects are limited. 

   ·On the other hand, the husband points to the short duration of the marriage between the parties and asserts that the wife is in essentially the same financial position, as she was in when the parties met, other than that she is now debt free. 

2. In practical terms, the wife’s position is that she should receive 35% of the parties’ current net asset pool, at the end of the second step and a further 7.5%, by way of factors raised pursuant to section 75(2), at the end of the third step.

3. Accordingly, the wife seeks to receive 42.5% of the parties’ assets.  In support of her case, she points to the fact that both the Property M and [W] properties and the husband’s savings increased significantly during the period of the parties’ marriage.  It is her case that she is entitled to a significant proportion of the moneys attributable to this increase in the husband’s wealth. 

4. It is her case that she made considerable “sacrifices” to accompany the husband overseas and, if she had not done so, he would have remained in Australia, presumably earning a more modest income, and so would have been unable to reap the benefits flowing from the appreciation of the various assets held in his name. 

5. The husband does not agree.  It is his case that the appreciation in value of the two properties concerned had nothing to do with the wife’s activities. In addition, he disputes the wife’s suggestion that her support was an essential prerequisite for him continuing to work overseas.

The evidence

1. Both parties assert to the court that he or she should be found to be a witness of truth and the other party to be lacking in credibility.  In my assessment such a simple dichotomy is not open to me.  In the case of each of the parties, I found some of their evidence to be compelling but other aspects of it to simply not ring true. 

2. I think both parties have an axe to grind.  The husband wishes to escape censure for his violent behaviour during the marriage and minimise his liability to the wife.  The wife wishes to penalise the husband for his past behaviour and maximise her entitlements.  This state of affairs has implications for the reliability and objectivity of the evidence of both parties. 

3. The marriage between the parties was one of three years in duration.  In these circumstances, given the shortness of the marriage, the husband is aggrieved that the wife has brought proceedings against him where, in his perception, he provided many material benefits for her and she provided no financial contributions whatsoever. 

1. On the other hand, the wife portrays herself as a victim during the marriage.  She was deeply unhappy living overseas and blames the husband for it.  She is also angry that she was the subject of the husband’s violent behaviour towards her. 

2. Accordingly, both parties leave the marriage with a sour taste in the mouth.  Proceedings between former marital partners very often evoke strong emotions in the parties concerned, particularly where they feel hard done by, as a result of the circumstances surrounding the end of that marriage.  In this case, both parties feel very hard done by, but for different reasons.

3. Emotions and agendas of this kind are likely to inform how parties recollect past events and, when those events need to be reconstructed, for the sake of adversarial proceedings such as these, it is only to be expected that such a subsequent reconstruction should favour the party making it. 

4. In this case, both parties currently view the other through a distorting prism of hostility.  As such, both have, I think, followed the natural human tendency, in proceedings such as these, to minimise their own failings and maximise those of the other.

5. For the same reason, both have maximised the extent of their respective contributions and minimised those of the other.  This is particularly so in respect of the issue of domestic contributions and in regards to the renovations done on each of the properties concerned.

6. For those reasons, it is inevitable that both parties have reconstructed parts of their marital history and placed undue emphasis on matters, which are likely to be of assistance to them in the ultimate outcome of the case.  This is understandable given the significance of it to both parties.  The proceedings were bitterly contested and there is currently no love lost between them.

7. Whether those reconstructions were conscious or unconscious is difficult to say, in the absence of corroborating evidence.  However, I have little confidence in either parties’ capacity to provide a completely objective recollection of what occurred between them.

8. I think it likely that the wife has overstated the extent of her non-financial and home making contributions, during the course of the parties' marriage.  I also suspect that she has also overstated the level of her unhappiness, whilst living overseas.

9. On the other hand, I did not believe the husband’s denials of having been physically violent towards the wife.  I find that he did assault her physically, during the parties’ marriage. 

10. However, because the husband was untruthful about this aspect of the parties’ relationship, I do not think it necessarily follows that I must reject all other aspects of his evidence, particularly in respect of financial issues. In my assessment, the husband seemed to be an accurate historian of financial matters. 

11. Pursuant to section 140 of the Evidence Act1995 (Cth) the standard of proof to be applied in this case is the balance of probabilities. As a result of section 140(2), without limiting the matters which the court can take into account in determining whether it is satisfied regarding any particular matter on such a balance, the court may also take into account the following:

    “(a)   the nature of the cause of action or defence; and

    (b)     the nature of the subject-matter of the proceedings; and

    (c) the gravity of the matters alleged.”

12. In this case, I believe it would be imprudent of me to determine issues of fact on the basis of my assessment of the respective credibility of each of the parties alone.  Essentially determining that one party is more likely to be truthful than the other and therefore resolve all factual issues in dispute in favour of that party.  In my view, the evidentiary topography, in this case, is more complex than that.

13. In what follows, I will attempt to analyse the evidence relating to the various factual issues in dispute and, if I can, make findings on the balance of probabilities.

a)     Background

1. The husband was born in Auckland [in] 1957.  The wife was born in [W] [in] 1964.  The husband immigrated to Australia in 1980. 

2. The wife separated from her first husband in 1998.  She has two children from this marriage – [X] born [in] 1980 and [Y] born [in] 1991.

3. The husband has also previously been married.  His daughter [Z] is aged fifteen.  She is living with Mr Meldrum presently in Thailand, where she is attending school.  As I understand matters, the husband’s other child, a son, is an adult. 

4. The wife says the parties met in May of 2004 and “commenced a relationship within two weeks of meeting each other.”[7]  The husband uses different terminology in respect of the early stages of the parties’ relationship.  He asserts that they began “cohabitation about October 2004, after dating whilst I lived in [W].”[8] 

   [7] See wife’s affidavit at paragraph 13

   [8]  See husband’s affidavit filed 17 November 2008 at paragraph 4

5. This was not an issue, which was canvassed in any detail during the hearing before me.  In particular, the wife does not specifically refute the husband’s assertion that the parties began to live together formally only two weeks prior to their marriage. 

6. It is not always the case that an exact date can be ascribed to the commencement of a de-facto relationship between partners, as can be done with the spouses to a marriage, whose union is formally marked and commemorated by a specific ceremony.  Necessarily, de-facto relationships proceed in informal degrees. 

7. On the evidence before me, it is unclear specifically when the parties began to join their fiscal resources together and to support one another financially as well as emotionally.  In any event, the differences in perspective between the parties, is not great.  The wife says the parties formal relationship began in May of 2004; the husband that it was about five months later.

8. It seems to me that the relationship between the parties most probably proceeded fairly quickly and they became significantly involved, with one another, soon after they met.  However, this involvement does not appear to have had significant financial consequences for either of them until later.  In my view, the marriage between the parties is to be regarded as one of less than three years in duration, which commenced, for the sake of these proceedings, in October of 2004.

b)     The parties’ respective asset backing at the date of their marriage

1. The husband purchased the Property M property in March of 2004.  The purchase price was $230,000.00. The husband purchased the property, in equal shares, with his friend Mr C.

2. The husband paid a deposit of $23,000.00.  On settlement he and Mr C advanced a further amount of around $26,600.00. They borrowed the remaining moneys to complete the purchase from the Westpac Bank, the loan being secured by way of a mortgage on the property. The amount of the mortgage was around $182,500.00. It is common ground between the husband and Mr C that they made an equal financial investment in the property.

3. Accordingly, I calculate the value of Mr Meldrum’s interest in the property, when the parties married, as being somewhere in the vicinity of $25,000.00. It is common ground between the parties that Ms Dodge made no financial contribution towards the acquisition of this property, which the husband purchased prior to meeting her. 

4. The husband purchased the [W] property in September of 2004.  The purchase price was $85,000.00. The wife and her father were instrumental in the husband buying the property, as they convinced him it was a good buy. 

5. The husband paid a deposit of $8,000.00 to secure the property.  The remainder of the purchase price was provided by a mortgage advance, of around $60,000.00, with the remaining moneys coming from his savings.  Accordingly, the husband had an equity of around $25,000.00, in the property, when the parties married. 

6. The husband had also accumulated superannuation, prior to the parties' marriage.  This was worth around $47,000.00, at the time of the parties' marriage.  As the husband has been working off-shore since the end of 2004, he has not contributed any significant sums to this superannuation, in the period of the parties' marriage. 

7. In addition, it is common ground that the husband had savings of around $30,000.00, when the parties married.  He also had a motor vehicle, which he asserts was worth $20,000.00.  Besides his mortgage liabilities, the husband had modest credit card debts.  In round terms, I find that he brought into the marriage assets to the value of in excess of $90,000.00. 

8. As has previously been indicated, the wife was not in a strong financial position, when she met the husband. She owned a Hyundai Excel motor vehicle, which was worth somewhere around $10,000.00.  It was subject to a loan agreement worth around $9,000.00.  In addition, the wife had furniture and other household items, which have not been valued. 

9. More importantly, it is clear that the wife had a number of other significant debts, at the time of the parties' marriage. She owed $4,342.61 to the Australian Central Credit Union.[9]  In addition, the wife owed a sum in excess of $35,000.00 to PMI Mortgage Insurance Limited jointly with her first husband Mr D.[10] 

   [9] See letter of demand dated 29 April 2005 addressed to Ms Dodge being annexure A to the husband’s affidavit filed 24 August 2009

   [10]  See Magistrates Court summons filed 21 April 2005 being annexure B to the husband’s affidavit filed 24 August 2009

10. This latter debt arose when the wife and her first husband defaulted in 1999 in respect of a mortgage secured against a property previously owned by them in [W].  It would appear to be the case that the wife and her first husband were jointly and severally liable for this debt. 

11. Following the parties' marriage, in early 2005, the husband instructed his solicitor to negotiate with the wife’s two creditors.  Following these negotiations, the debts were each compromised for $2,500.00 and $7,500.00 respectively.  The cost of the legal advice involved was $935.00.  All these expenses were paid, by the husband, from his accumulated savings. 

12. Accordingly, I find that there was a vast discrepancy between the parties’ respective financial positions, at the commencement of their marriage. The wife was markedly in debt. The husband had significant savings and assets, which later formed the basis of the parties’ current pool of matrimonial assets.

c)     The renovations at the Property M & [W] properties

1. There is significant controversy between the parties regarding the extent of the wife’s contributions made in respect of readying both of the properties owned by the husband either for rental or potential sale.  In this context, the evidence of Mr C, Ms G and Mr H is relevant. 

2. Mr H sets out the history of the [W] property in his affidavit.  He lives in the area where the house is located and knew the previous owner concerned, who died shortly prior to the husband’s purchase of it. Mr H alerted Mr Meldrum to the property because he thought it was a good purchase. 

3. The property was purchased about a month prior to the parties' marriage.  The intention was that it was to be rented out.  The property needed some work to prepare it for rental.  In the period leading up to their marriage, both parties were anxious to be involved.

4. During some of this preparatory period, the husband was on holiday, in Fiji, with his children.  He returned later to [W] and was involved in some of the necessary work, as was the wife. 

5. Mr H is a retired [tradesman]. He did some [trade] work on the property, particularly [omitted].  In Mr H’s words, he was “happy to help” as the work required was “right up my alley”.  The work took him about one day.  Again, to use his words it was “not a huge job”.  Mr H did not receive any payment for his work but Mr Meldrum reimbursed him for the materials, which he purchased and used in the job. 

6. Later, after the property had been rented, Mr H and his wife kept an eye on the property, whilst the parties were overseas. However,

   
   

   Mr Meldrum utilised a real estate agent in [W] to manage the property.  On one occasion, Mr H was asked to repair a fluorescent light tube, at the property, for the tenant concerned.  He was happy to do so. 

7. In addition to his [trade] work, Mr H and the wife hung some curtains at the property and tidied up the garden. Mr H deposed that the gardening work involved was “not particularly onerous”. These efforts were required to make the property more amenable to being let.

8. At the time of her efforts on the [W] property, Ms Dodge continued to work.  She was also finalising her affairs in [W] and packing to travel overseas with the husband.  In this context, I do not think that it can be said that the work involving in preparing the [W] property for rental was the main focus of her attention at the time and so was particularly onerous or time consuming. 

9. The impression I have is that the property itself did not require a huge amount of work.  It needed to be painted inside.  The parties were both involved in this painting work, which took a few days. 

10. Mr Meldrum concedes that the wife assisted him with the painting.  However, it is his case that she was happy to help him.  Undoubtedly this was the case, given that the parties were soon to be married.  In the overall context of the parties' marriage, I do not think that the work done at the [W] property can be regarded as significant. 

11. The parties agree that the Property M property was in a poor state of repair, although they disagree as to the extent of its dilapidation.  The wife’s position is that it was unfit for human habitation.  The husband’s position was that it was suitable for occupation, if not particularly comfortable. 

12. In any event, the plan was that the wife would travel to Property M, prior to flying to the Cook Islands for the parties’ wedding.  She would meet the husband there and the two would stay at the Property M property, whilst work was done.  It also seemed to be the case that this would be an opportunity for the wife to meet the husband’s children. 

13. Ms Dodge travelled to Property M with her friend, Ms G, who was to be her bridesmaid at the parties’ wedding. In her affidavit, Ms G provides her impressions of the property. 

14. She describes it as being in very poor condition, infested with cockroaches and stinking of urine.  It is her evidence that she and the wife did a great deal of cleaning to make the property a little less unsightly.  I accept that this is so. 

15. The more significant aspect of the case is what was the work, which was done on the property, in the period between the parties’ return from their wedding and honeymoon in the Cook Islands, and their departure for Vietnam on 9 November 2004, a period of two or three weeks.

16. It is undoubtedly the case that a great deal of work was done on the property.  It is the husband’s case, supported by Mr C that he and Mr C did the vast majority of this work.  The wife does not agree, contending that she was integrally involved in it and worked “tirelessly”. 

17. The wife’s position is that she was involved in stripping wallpaper; sanding and plastering walls; and painting.  At the same time, she provided care for the husband’s children, including cooking meals for them.  It is also her case that she extensively cleaned the house throughout. 

18. The husband is dismissive of the wife’s evidence asserting that she did “minimal work”, which he sums up as “she handed me a paint brush.”  It is his case that he and Mr C and Mr C’s brother Mr S did the vast majority of the work required, which was extensive. 

19. Mr C is a [tradesman].  Mr Meldrum also has a history of employment in the building industry.  They have been friends for forty years.  It seems more likely to me that they performed most of the heavy work required on the Property M property, particularly the preparatory work to painting and sanding the floors. 

20. It is Mr C’s evidence, which I accept, that he and his brother continued to work on the property, after the husband and wife had moved overseas.  This included renovating the bathroom and kitchen.

21. More work was done on the Property M property in May of 2005 between the end of the husband’s contract in Vietnam and the start of his contract in China. The parties were in Australia for about a fortnight.

22. During this period floors were sanded and sealed.  Carpet was pulled up and laid and wardrobes were installed.  It was heavy and dirty work.  I accept the wife is likely to have played a part in removing the carpet but I accept that the husband did the vast majority of the heavy and skilled work involved.

23. Prior to Christmas in December 2006, more work was done on the kitchen.  Again, given the nature of the work, it seems more likely than not that the husband performed more of if than the wife.  She organised a garage sale for the superfluous kitchen appliances, which had been removed.

24. It was the husband and Mr C’s intention to renovate the property, using largely their own labour, with the intent of selling it at a profit.  They did not complete the renovations required prior to deciding to sell.  The property was sold in July 2008 for a sum of $380,000.00.  An amount of around $180,000.00 was owing on the mortgage at the time of settlement. 

25. The proceeds of sale were divided equally between the husband and

    
    

    Mr C. After paying the necessary expenses, each received around $98,000.00. The sale of the property yielded a gross profit of $150,000.00 in a little over four years.  Accordingly, it seems to have been a good purchase.

26. In my view, the evidence indicates that the appreciation in the property’s value is attributable largely to the efforts of Mr Meldrum and Mr C, as well, most likely, to forces in the market place.  I accept that the wife made some contribution, but these are minor when compared to those of the husband and Mr C, who were the instigators of the scheme to renovate the property and had the expertise required to do it.

d)     The parties’ expatriate experience

1. The husband’s first overseas contract, during the marriage, was from 9 November 2004 to the end of April 2005, in Vietnam.  He worked for [L] as a [occupation omitted].  He was paid A$850.00 per day. 

2. Mr Meldrum worked long hours during the contract.  He worked six days per week and up to ten hours per day.  His employer provided him with what is described as “air conditioned apartment style accommodation.”[11]

   [11]  See annexure A to the husband’s affidavit filed 17 November 2008

3. Following the completion of his contract with [L], the husband and wife took a month holiday.  They travelled to Australia, Singapore, Thailand, New Zealand and New York.  During the holiday in New York, the husband asserts he bought the wife expensive jewellery.  The wife is somewhat dismissive of its quality.

4. Between July 2005 and May 2006, the husband took a contract with [B] in South West China.  Again he was well paid and was allocated a fully serviced apartment, as part of his salary package. 

5. In June of 2006, the husband commenced his third overseas contract during the marriage, in Thailand.  He was employed as a [omitted] by [T] Limited.  He was paid around A$4,300.00 per week and was again provided with accommodation.  Again, it would seem to be the position that he worked long hours. 

6. The wife accompanied the husband on each of these placements.  The parties have different views as to the quality and comfort of the accommodation, which they were allocated.  They also have different views as to the nature of the expatriate lifestyle and its consequences for each of them. 

7. The wife did not enjoy living overseas and found the experience difficult and isolating. She had not previously lived outside of Australia.  I accept that she found living in developing countries to be a daunting experience. 

8. The wife describes herself as a tidy person, who is very house proud.  This is undoubtedly the case.  It also appears to be the position that she and the husband had different standards, so far as domestic cleanliness is concerned.  This differential is apparent from their opposing views regarding the state of the Property M property. 

1. The wife does not accept the husband’s assertion that all the accommodation provided to them took the form of serviced apartments.  It is also her case that she did not always have access to domestic assistance.  However, she does concede that she had access to a maid in Thailand. 

2. The wife found living in Vietnam to be difficult.  Her evidence was that the parties were required to live in what she described as “a fishing village”.  She did not particularly like the local foods, which were available.  As such, it is her case that she tried, wherever possible, to buy imported foodstuffs.  It is also her case that she fulfilled domestic duties above and beyond that which were provided by local employees. 

3. In particular it is her case that the husband has a delicate stomach, as a result of contracting giardia, whilst working in New Guinea. As a result she took pains to ensure that he ate meals made up of familiar ingredients.  This also seems to have been her personal preference.

4. The husband does not agree.  It is his evidence that the wife rarely cooked because the parties ate out frequently.  He denies that he has problematic digestion.  It is also his case that the wife had very few domestic obligations because their accommodation was maintained and serviced by locally employed workers.  Essentially he asserts that she led a life of leisure.

5. In my view this is somewhat unfair to the wife.  I accept that life must have been very difficult for Ms Dodge from time to time.  Mr Meldrum was busy with his work and was away from the home for long periods of time.  In such circumstances she must have felt lonely and isolated.  The novelty of exotic surroundings seems to have soon palled for her.  I suspect that her expectations of overseas life did not match up with the reality of her experience. 

6. Some individuals find the experience of living in a new cultural setting invigorating and exciting.  Others do not.  It is not appropriate for me to attempt to ascribe reasons as to why the expatriate lifestyle was not to the wife’s liking.  However, it cannot be said that the husband lured her away to Vietnam, China or Thailand by any false representations.  The wife was content to give living overseas “a go”, notwithstanding she had no previous experience of such a lifestyle.

7. It is the underlying tenor of the wife’s case that her various home making contributions, during the marriage, were rendered more significant because of the onerous circumstances in which she had to discharge them.  Both because of the fact that she was required to live overseas during the marriage and because of the husband’s conduct to her.  It being her case that the husband was frequently violent towards her.  She argues that these factors should cause the court to weight her contributions more significantly than it otherwise would. 

8. There is no evidence, apart from each parties’ assertion of the fact, to support his or her case in respect of the nature of the wife’s home making contributions or lack thereof. Disputes of this kind are common in vitriolic proceedings, between former partners, regarding the division of matrimonial property.  Given the private nature of most marriages, these disputes are very often difficult, if not impossible, for the court to resolve. 

9. In my view, the truth most probably lies somewhere between the parties’ competing positions.  The wife did not lead a life of idle pleasure, as the husband contends.  I suspect she was lonely and bored for much of the time.  She had a deal of domestic assistance but also felt compelled to do some of her own cooking, cleaning and shopping.  It would also seem to be highly likely that the parties ate out frequently. 

10. The husband’s work history, prior to the parties' marriage, was one which involved expatriate contracts.  The wife was well aware of this and no doubt had been informed by Mr Meldrum of the financial benefits involved.  In this context, she went ahead with the marriage to Mr Meldrum, knowing that it would involve him continuing to work overseas.  She was willing to travel overseas with him, notwithstanding she had no personal experience of the likely rigours involved. 

11. The marriage was not without its risks.  Many marriages do involve a significant degree of change for the parties concerned.  However, some level of risk is a necessary corollary of many aspects of human endeavour, including marriage. One party to a marriage is not necessarily to be penalised because things do not work out between the parties as one of them envisaged. 

12. As the Anglican Book of Common Prayer has it, marriage is “for better or worse, for richer or poorer”.  Although the wife did not enjoy many aspects of living overseas, there were benefits, largely financial, arising from it.  She enjoyed a comfortable standard of living, involving holidays and the purchase of consumer items. 

13. The husband has deposed that he paid for [Y]’s school and living expenses in [W]. In addition, he paid for [Y] and [X] to have a holiday.  He also paid the costs involved in the wife undertaking a child care course, whilst the parties were living in China.  More controversially, the husband deposes that he paid for the wife to have extensive dental work; botox injections; and a breast enlargement procedure. 

14. The husband’s case is that these various things were cosmetic in nature and came about at the wife’s instigation.  The wife does not agree.  It is her case that she required dental treatment because the husband had assaulted her resulting in significant damage to her teeth.  It is her case that she underwent the breast enlargement operation only because the husband wanted her to and the operation involved caused her a significant level of pain and discomfort. 

15. The husband attributes a value of around $10,000.00 to these various procedures.  In addition, he contends that he paid around $20,000.00, in respect of expenses relating solely to the wife or members of her family. 

16. I do not propose to make any great comment about the wife’s surgery other than I regard the cost of it to be a domestic expense, which has arisen incidental to the parties' relationship.  I accept the operation was painful.  Many operations are.  I do not believe that the wife was unaware of the potential discomfort involved.  Certainly I would expect that she would have been advised of such a possibility.

17. In addition it seems inherently unlikely that the wife underwent the operation solely to please the husband.  I suspect both parties played a part in the operation taking place.  In a legal sense, as the wife’s body was involved, she would have had to give the necessary consent required.  She does not state that she was either tricked or coerced into giving this consent.  Having seen the wife in the witness box, I doubt that she would have either been duped about the operation or forced to undergo it, against her will.

18. It is not my role to perform some audit of the parties various’ expenses, during their marriage and produce some form of notional balance sheet, of what is reasonable and what is not and allocate the expenditure to either the husband or the wife.  The money on holidays, clothes and surgical procedures was spent consensually and has not produced any asset into which it can be traced.  As such, it is not appropriate to notionally “add back” the expenditure and attribute it to one of the parties.

19. I take the same view as to the moneys which the husband voluntarily allowed to be spent on the wife’s children and on other expenses relating solely to her.  These sums have been expended and cannot be specifically recouped or allocated now.

20. In a general sense however I accept that these expenditures made the wife’s existence a little more comfortable and palatable.  They came about because of the husband’s circumstances, particularly his high income.  The husband voluntarily approved the expenditure involved.  No doubt because he wanted the wife to be happy.  It is difficult to allocate an exact sum for the various items in question but it is likely to be significant.

f)      Family violence

1. I accept the wife’s evidence that the husband was frequently and seriously violent towards her.  This violence commenced on the eve of the parties’ marriage and seems, at least in part, to have been triggered by the husband’s alcohol consumption.[12]  That of course does not excuse his behaviour in any way. 

   [12]  See Exhibits H, I and J

2. However, it is not the purpose of these proceedings to reinsert fault or blame into the factors relevant to determine financial matters such as this one.  The relevant authorities indicate that I must adopt a cautious approach to such issues. 

3. In this regard, it is appropriate to set out the relevant passages from the Full Court’s decision in Kennon:

   “Put shortly, our view is that where there is a course of violent conduct by one party towards the other during the marriage which is demonstrated to have had a significant adverse impact upon that party’s contributions to the marriage, or, put the way, to have made his or her contributions significantly more arduous than they ought to have been, that is a fact which a trial judge is entitled to take into account in assessing the parties’ respective contributions within s.79. We prefer this approach to the concept of “negative contributions” which is sometimes referred to in this discussion.

   In the above formulation, we have referred only to domestic violence, for the reasons which we indicated earlier, but its application is not limited to that.”

4. And further on:

   However, it is important to consider the “floodgates” argument.  That is, these principles, which should only apply to exceptional cases, may become common coinage in property cases and be used inappropriately as tactical weapons or for personal attacks and so return this Court to fault and misconduct in property matters – a circumstance which proved so debilitating in the past.  In addition, there is the risk of substantial additional time and cost.

   However in our view, s 79 should encompass the exceptional cases which we described above.  It would not be appropriate to exclude them as a matter of policy because of this risk.  It is a matter of commonsense for the lawyers involved and, where that may not be sufficient, it is a matter for a firm hand by the Court at an early stage when a case appears to raise those issues.

   It is essential to bear in mind the relative narrow band of cases to which these considerations apply.  To be relevant, it would be necessary to show that the conduct occurred during the course of the marriage and had a discernible impact upon the contributions of the other party.  It is not directed to conduct which does not have that effect and of necessity it does not encompass (as in Ferguson) conduct related to the breakdown of the marriage (basically because it would not have had a sufficient duration for this impact to be relevant to contributions).”[13]

   [13] See Kennon & Kennon (supra) at 84,294-5

5. I do not condone the husband’s reprehensible behaviour in any way.  His conduct is to be condemned in the strongest terms but these proceedings are not designed to compensate the wife for each of the assaults committed on her by the husband. 

6. My function is to assess the parties’ respective marital contributions, within the legislative matrix provided by section 79(4). To be relevant, it must be demonstrated that the husband’s violent conduct had a “discernable impact” upon the wife’s contributions.  In essence, the question is whether it was more difficult or onerous for the wife to be a homemaker because of the husband’s violent behaviour. 

7. In all the circumstances of this case, I do not think that the wife has demonstrated a sufficiently delineated impact upon her homemaking contributions such to influence the application of the provisions of section 79(4) to this case. In my view, this is particularly so given the shortness of the marriage and the absence of children.

8. I accept that some aspects of the wife’s marital experience were deeply unhappy.  This flowed from both the husband’s violent treatment towards her and the fact that she felt isolated and alienated by her overseas experiences.  However, on the evidence before me, I do not find these matters to be exceptional in the terms referred to by the Full Court.  Indeed, counsel for the wife, Mr McQuade concedes that this is his client’s position. 

9. The wife described herself as an “emotional wreck” by the time she arrived in Thailand.  This may be so but I have no specific expert evidence to tie the wife’s alleged psychological state to the husband’s behaviour.

10. Nor do I think the evidence led before me is sufficient to allow me to reach the conclusion that the husband would not have undertaken his overseas employment, if the wife had not been willing to come with him.  In particular, I do not think that this was an issue in the parties' marriage, certainly not at its outset. 

11. It was a given between the parties that they would go to Vietnam together and would live overseas because this was the manner in which the husband had previously earned his comfortable income.  The wife knew this and was content to allow him to be the family’s main financial provider.  In addition, it seems more likely than not that the wife was curious about what it would be like to live overseas and was initially attracted to the prospect.

g)     Events and separation and afterwards

1. The parties returned to Australia, from Thailand, prior to Christmas in 2006.  At this stage the husband purchased a 2002 model BMW coupe motor vehicle for the sum of $23,650.00.  In addition, he paid for the registration and insurance required for the vehicle, bringing his total outlay to a sum just over $25,000.00. 

2. The motor car was purchased as a Christmas present for the wife.  As a result, she and her son [Y] travelled in it from Newcastle to [W] to visit family over Christmas.  The husband remained in Newcastle and did some more work on the Property M property.

3. The wife and [Y] returned to Newcastle in early January of 2007.  A few days later, the parties had a violent altercation with one another at the Property M property.  This event marks their final separation. 

4. The wife decided to leave Newcastle. She left in the BMW motor vehicle. She retains this vehicle. As earlier indicated, it is the husband’s position that the wife’s retention of this vehicle should largely represent her property entitlements, following the conclusion of these proceedings.

5. The vehicle has not been formally valued and some controversy exists regarding its worth.  In her affidavit material and financial statement, the wife estimates the car’s worth to be $18,500.00.  In her counsel’s closing submission it is noted to be worth $10,600.00.  The husband asserts it to be worth $14,000.00, in his counsel’s closing submissions.

6. The wife’s counsel has tendered a red book valuation of the model of the vehicle in question.[14]  It gives a “private price” of between $12,400.00 to $14,400.00 and a “trade in price” of between $9,600.00 to $11,800.00.

   [14]   See Exhibit E

7. In these circumstances, given the wife’s sworn estimate of worth, I propose utilising the highest figure provided by the red book of $14,400.00 to ascribe a value to the motor vehicle in question.

8. As has previously been indicated, the wife brought into the marriage a Hyundai Excel motor vehicle.  It was subject to a finance agreement.  The wife had no need of the vehicle during much of the parties' marriage, whilst they were living overseas.  Accordingly, it was placed in storage in Newcastle. 

9. The husband paid the necessary storage fees.  In addition, he paid the finance instalments due on it, as the wife had no independent income of her own.  By the time of the parties’ separation, the debt relating to the vehicle had been expunged.  Following the parties’ separation, the wife also retained this motor vehicle. 

10. She arranged for it to be transported from Newcastle to [W], where she sold it for the sum of $9,200.00.  She retained this sum and has utilised it on living expenses.  She continues to own and use the BMW motor vehicle. 

11. It is the wife’s case that the parties’ separation inaugurated a period of considerable financial austerity for her.  I accept that this was so.  Up to that stage, she had been totally financially dependent upon the husband.  She had no independent source of income and no savings. 

12. It is also her case that most of her personal possessions remained in Thailand.  In addition, she had earlier disposed of her furniture and household appliances, when she married the husband and moved overseas.  In these circumstances, she deposes that she had to “start from scratch” in South Australia.

13. The wife used the proceeds of sale of the Hyundai Excel to assist her financially.  She also borrowed moneys on her credit card.  In addition, she took some moneys from an account standing in her name and the husband’s.  The parties are in dispute about the amount of money involved. 

14. The wife asserts that she withdrew $2,000.00 from the account and later the husband sent her a further sum of $2,000.00.  It is her case that it cost her around $2,000.00 to transport the Hyundai Excel motor vehicle back to Adelaide.  

15. The husband asserts that the sum is closer to $6,000.00.  At this stage, I am unable to satisfactorily resolve this area of dispute between the parties.  In any event, I do not think a great deal turns on it, as the discrepancy is not great and, in any event, the sums in question have been long spent. 

16. I accept that the wife was in a parlous financial situation at the time.  In those circumstances, she had no alternative but to look to the husband for financial support. He appears to have recognised this state of affairs, as is implicit from him agreeing to send the wife the sum of $2,000.00. 

17. In these circumstances, notwithstanding the fact that the parties were separated, there remained a financial connection between them.  The wife was not immediately obliged to sever all her financial dealings with the husband.  In my view, what she did was reasonable in the difficult circumstances, which confronted her.  As such, there is no justification to notionally “add back” these sums into the parties’ pool of marital assets as some form of premature distribution of assets.[15]

    [15]  See NHC & RCH [2004] FLC 93-204

18. The wife’s evidence was that she did not feel up to returning to work in hospitality, the area in which she had been working when she first met the husband because she lacked confidence at the end of the parties' marriage.  In these circumstances, she sought and obtained work in the field of child care.  Initially, she worked around eighteen hours per week at a child care centre in Adelaide. 

19. The wife deposed that she was earning around $800.00 gross per week.  More recently, the wife has returned to her previous line of work, [in the hospitality industry].  She is currently earning $25.18 per hour.  Her hours of work are flexible and she works between 32 and 39 hours per week.  Her most recent group certificate indicated an annual gross income of around $35,600.00.

20. At the present time, the wife is living in rented accommodation.  In her financial statement, she estimates the value of the BMW motor vehicle at $18,500.00 and the value of her jewellery and laptop computer at $5,000.00.  She has no other significant personal property. 

21. In terms of superannuation, Ms Dodge has deposed that she holds a little over $26,000.00 in two separate funds.  It would appear to be the case that the vast majority of this superannuation was acquired by her prior to the parties' marriage.  The wife also has a significant credit card debt of $16,000.00.  This liability has been largely incurred post-separation. 

22. The husband continues to work in Thailand for [T] Limited as a [omitted]. He estimates his weekly income at A$4,300.00 which equates to A$223,600.00 per annum. He estimates that he pays A$2,000.00 in tax per week to the Thai revenue authorities. 

1. The husband continues to own the [W] property.  He had earlier placed the property on the market, which was the catalyst for the wife commencing these proceedings.  She sought an injunction to prevent the sale of the property, pending the outcome of these proceedings. 

2. This application was dealt with on 15 October 2008, when I granted the injunction sought.  The parties agree that the [W] property is currently worth $180,000.00 and is subject to a mortgage of $57,000.00.  The property continues to be rented out at a rental of $200.00 per week, which is the approximate amount of the moneys required to service the mortgage on the property. 

3. Since the parties separated, the husband has formed a new relationship, in Thailand, and has a young child.  He has purchased an apartment for himself in Thailand at a cost of A$14,000.00. 

4. The husband owns two motor vehicles, a Honda Civic and a Toyota Vego. Both these vehicles were purchased, following the parties’ separation, whilst the husband was living in Thailand. The husband owes around $13,500.00, to Toyota Finance, in respect of the purchase of these two vehicles. 

5. The husband’s daughter, [Z] has recently decided to live with her father in Thailand.  She is attending secondary school there and the husband is responsible for paying her school fees, which are A$4,000.00 per quarter.

6. At the date of hearing, Mr Meldrum estimated that he had accumulated savings of around $55,400.00. As at the date of separation,

   
   

   Mr Meldrum believes that he had savings of a similar magnitude.  In contrast, in October of 2004, when the parties married Mr Meldrum asserts that his savings amounted to around $32,000.00.  I accept this later figure.

7. The husband received a significant injection of capital when the Property M property was sold.  He bought his son a car for $8,000.00; paid removal expenses for his goods between Australia and Thailand of $5,000.00; and paid credit card debts of around $12,000.00.

8. Following the granting of the injunction restraining the husband from selling the [W] property, the parties were referred to a conciliation conference on 20 February 2009.  The parties were unable to resolve the matter at that conference.  Accordingly, the matter was fixed for a one day hearing on 2 September 2009. 

9. I was hopeful that the matter could be concluded in the one day set aside for it.  I was anxious that the parties not be put to unnecessary expense by the hearing going into a second day, particularly given that the marriage between the parties had not been a long one and, in such circumstances, I wished them to avoid the burden of unduly high legal fees. 

10. Unfortunately my hopes were misplaced.  The evidence was able to be concluded on the day in question but counsel’s submissions could not be.  Mr Meldrum was represented by counsel from New South Wales who had travelled to Adelaide for the day. It would have been expensive for him to return to complete the matter.

11. In these circumstances, I thought the most expeditious way to deal with the matter was by way of written submissions.  I was also advised that the parties were likely to be able to provide me with an agreed schedule of the parties’ pool of assets.  This schedule has never materialised. 

12. The husband’s written submissions appeared promptly on 30 October 2009.  The wife’s submissions were not received until 25 January 2010.  This has led to the delay in these reasons for judgment being produced.  The absence of specific agreement about the extent of the parties’ asset pool has created difficulties for me at the first step of the process of determining this matter.

Step One – the pool of assets

1. There is a level of artificiality in calculating the parties’ pool of assets at trial.  The parties separated in January of 2007, nearly three years prior to the hearing.  In that period, the husband has continued to earn a high income and has been able to increase his savings.  However, he has also realised his interest in the Property M property, which had appreciated in value since it purchase. 

2. In addition, the husband has acquired a number of other assets, specifically two motor vehicles and an apartment in Thailand.  Both parties have also incurred debts.  The wife has a credit card debt of $16,000.00.  The husband a credit card debt of $5,400.00 and other liabilities to Toyota Finance.  Finally, many items of property have not been formally valued, specifically the BMW motor vehicle and the wife’s jewellery. 

3. Notwithstanding these difficulties, I calculate the asset pool as follows:

Assets

$

[W] property

180,000.00

BMW motor vehicle

14,400.00

Toyota Vego motor vehicle

25,000.00

Husband’s Thai property

14,000.00

Honda Civic motor vehicle

8,300.00

Wife’s jeweller and laptop *

5,000.00

Husband’s furniture *

5,000.00

Husband’s savings

55,300.00

TOTAL

307,000.00

Liabilities

Mortgage on [W] property

57,000.00

Husband’s credit card debt

5,400.00

Wife’s credit card debt

16,000.00

Husband’s Toyota Finance debt

13,400.00

TOTAL LIABILITIES

91,800.00

Net Non-Superannuation assets

215,200.00

Superannuation

Husband’s superannuation

47,000.00[16]

Wife’s superannuation

28,800.00

TOTAL SUPERANNUATION

* Agreed between the parties

75,800.00

[16]  I have utilised the figure provided in the husband’s statement of financial circumstances

1. In the circumstances of this case, I do not propose to notionally add back the proceeds of sale of the wife’s Hyundai Excel motor vehicle.  As previously indicated, I accept that she has spent the proceeds of sale of this vehicle on providing for her recurrent living expenses, in the period following the parties’ separation.

2. For the same reason I do not regard the monies utilised by the wife, at separation, are to be regarded as a premature distribution of marital assets, which needs to be specifically arithmetically included at this stage of the process.

3. The wife’s credit card debt is largely related to the payment of her legal fees.  The husband has not as yet paid his legal fees.  I have not been advised of the likely extent of his fees.  As such those fees cannot be notionally added into the pool in some way.

Step Two – assessment of contributions – section 79(4)(a) – (c)

1. I now turn to the second of the steps in the exercise under section 79, namely an assessment of the parties’ contributions within the context of section 79(4)(a) to (c). These provisions are as follows:

   “Section 79(4)  In considering what order (if any) should be made under this section in proceedings with respect to any property of the parties to a marriage or either of them, the court shall take into account –

   (a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them;

   (b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them;

   (c)the contribution made by a party to the marriage to the  welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of home maker or parent.”

2. Section 79(4) requires that the court look at the entirety of the contributions, both financial and non-financial, to the welfare of the family, as well as to the acquisition, conservation and improvement of those assets. Contributions are not required to be tied to the acquisition, conservation and improvement of any particular asset and maybe taken into account generally as contributions in a total sense.

3. The task required of me pursuant to section 79(4) of the Family Law Act thus is to weigh and assess the disparate contributions of the parties to arrive at an outcome, which is both appropriate and just and equitable in all the circumstances. Contributions, which are different in quality and nature, must be compared. The exercise is not purely an arithmetical or accounting one.

4. In assessing the parties’ contributions towards the acquisition of the assets of their marriage, it is necessary to consider whether the court should adopt a global approach or an asset by asset approach.  In the former, the court assesses the parties’ contributions to their assets in a total or comprehensive manner. 

5. In the latter, the court assesses the parties’ contributions to individual items of property.  Both approaches are legitimate, however the High Court has held that the global approach is generally more convenient, particularly when it is necessary for the court to assess contributions, which are different in nature. 

6. In Norbis v Norbis[17] it was said as follows:

   “Although it is natural to assess financial contributions under sec. 79(4)(a) by reference to individual assets, it is also natural to assess the contribution of a spouse as home maker and parent either by reference to the whole of the parties’ property or to some part of that property.  For ease of comparison and calculation it will be convenient in assessing the overall contributions of the parties at some stage to place the two types of contribution on the same basis, i.e. on a global or, alternatively, on an “asset-by-asset” basis.  Which of the two approaches is the more convenient will depend on the circumstances of the particular case.  However, there is much to be said for the view that in most cases the global approach is the more convenient.”

   [17] Norbis v Norbis (1986) FLC 91-712 at page 75, 268 per Mason C J & Deane J

7. In a separate judgment delivered in Norbis[18], Wilson & Dawson JJ said as follows in regards to the issue as to whether a global or asset by asset approach was preferable in the assessment of marital contributions pursuant to the s.79 exercise:

   “If the parties’ interests in specific items of property differ or they have made differing contributions, it may be desirable to proceed upon an item by item basis in the division of the property between them.  In such a case, justice and equity may best be served by treating the items separately for the purpose of determining the proportions in which they are to be divided, particularly if the overall division is to be effected by the transfer or retention of interests in individual assets, as was convenient in this case.”

   [18] Norbis v Norbis (supra) at 75,173 – 75,174

8. Clearly the most important consideration, in whether to adopt a global or asset by asset approach, is which approach is more conducive to achieving an outcome which is “just and equitable”.  Factors which have been identified as influencing the decision include the duration of the marriage in question and how the parties themselves have dealt with any particular item of property during it. 

9. In McMahon & McMahon the Full Court of the Family Court (Nicholson CJ, Ellis and Buckley JJ) said as follows:

   “In our view, the particular circumstances of this case made an asset by asset approach preferable to a global approach.

   The short duration of and the unhappy nature of the marriage, coupled with the parties strict division of assets and their method of dealing with them lent itself to an asset by asset approach, particularly where they had separately identified another group of assets as joint.

   We are conscious of the remarks of Mason CJ and Deane J in Norbis v Norbis[19] where their Honours indicated that in most cases the global approach is more convenient.

   However, it should be remembered that they stressed that they were not to be understood as denying the legitimacy of the trial judge’s ascertainment in the first instance in the financial contributions of the parties by reference to particular assets.”[20]

   See Norbis v Norbis (1986) FLC 91-712 at page 75,168

   [20] McMahon & McMahon (1995)FLC 92-606 at page 82,043

10. The husband’s position, in the case, seems to be more weighted in favour of the court adopting an asset by asset approach.  It being his case that, given the short duration of the marriage between the parties, it is equitable for the court to return each of them to their original position at the commencement of their relationship, where he had significant asset backing and the wife was essentially in debt. 

11. On the other hand, the wife’s position leans more in favour of a global approach.  It being her position that she is entitled to share in any profits, which were accumulated during the marriage, particularly in terms of the appreciation in value of the [W] and [M] properties. 

12. In addition, the wife is concerned that, if the court adopts an asset by asset approach, what she characterises as her significant contributions as a home maker, may be overlooked or be given insufficient weight because they have not of themselves directly resulted in the acquisition of specific assets. 

13. It is a difficulty to which I have already alluded in that, pursuant to the section 79 exercise, the court is often called to compare fundamentally different things. In Ferraro,  the Full Court of the Family Court noted as follows:

    “The task of evaluating and comparing the parties’ respective contributions where one party has exclusively been the breadwinner and the other exclusively the homemaker, is a most difficult one to perform because the evaluation and comparison cannot be conducted on a “level playing field”.  Firstly, it involves making a crucial comparison between fundamentally different activities, and a comparison between contributions to property and contributions to the welfare of the family.  Secondly, whilst a breadwinner contribution can be objectively assessed by reference to such things as that party’s employment record, income and the value of the assets acquired, an assessment of the quality of a homemaker contribution to the family is vulnerable to subjective value judgments as to what constitutes a competent homemaker and parent and can not be readily equated to the value of assets acquired.  This leads to a tendency to undervalue the homemaker role” [21]

    [21] Ferraro & Ferraro (1992) 16 Fam LR 1 at 38

14. The situation in this case is not strictly on all fours with the one arising in Ferraro.  In Ferraro, the marriage in question was one in excess of 25 years and produced three children.  Of equal significance is the fact that during the marriage the husband concerned generated considerable wealth through his business endeavours, whilst the wife devoted herself to the care of the parties’ children and the upkeep of their home, duties which she discharged admirably. 

15. Clearly, the circumstances surrounding the marriage in the present case are significantly different.  The most significant differences being the length of the marriage and the absence of children.  In my view, the most important aspect of the case is the short duration of the marriage between the parties and the overwhelming capital and financial contributions made by the husband, both at the commencement of the marriage and during it.

16. In whatever order the court makes, in my view, it is incumbent upon it to give full recognition to the capital contributions made by the husband. Given the short duration of the marriage, the parties’ relationship was not one where assets were accumulated in the sense that the wife’s activities in the home freed up the husband, enabling and empowering him to go out and earn the significant income which he did. 

17. Rather, the marriage was one characterised by the maintenance of the parties’ asset situation, as it was when they met.  The parties lived well during their marriage, utilising the husband’s high income to finance this lifestyle, which they both enjoyed.  The mode of living was not orientated toward the accumulation of capital per se.[22]

    [22]  See Quinn & Quinn (1979) FLC 90-677 at 78,613

18. If an asset by asset approach is adopted, the husband is able to demonstrate an overwhelming, if not total financial contribution, to each and every item comprising the asset pool.  However, since the parties separated, there has been some significant transmutation of the asset pool.  Assets have been sold and acquired.  This militates in favour of an asset by asset approach.

19. But, notwithstanding this factor, in all the circumstances of the case, particularly given the wife’s reliance on non-financial contributions in her case, I have reached the conclusion that it is appropriate to take a global approach to the case.  However, I must be cautious not to lose sight of the significance of the husband’s financial contributions and so accord him an injustice. 

20. In this respect the case of Bushby v Bushby[23] is relevant.  In the case, the Full Court said as follows:

    “In the marriage of four years, with no dependant children being involved on either side, it ought to have been apparent to the parties’ legal advisors that each parties actual financial contribution to the marriage was the primary issue.

    Although the wife did make a contribution over a period of some four years by way of homemaker, nevertheless, I am satisfied to leave the parties as they were at the time of the separation would have produced a just and equitable result. 

    The husband’s income substantially exceeded that of the wife, and when one looks at the total property, whether in cash or in kind, which the wife received, to confer any further benefit upon her would, in my view, be a grave injustice to the husband.”

    [23]  See Bushby v Bushby (1998) FLC 91-919

21. The husband came into the marriage with a significant amount of cash savings.  He also brought in two pieces of real property, albeit both were encumbered by mortgages.  On the other hand, the wife was in debt, when the parties married.  The husband cleared the wife’s debts, in the early years of the marriage, by the transfer of moneys to her creditors.  Clearly, this gross discrepancy in the parties’ respective level of wealth is a factor which must be given “special recognition” [24] in how the court assesses the respective contributions of the parties.

    [24]  See Pierce & Pierce (1999) FLC 92-844

22. During the marriage, the wife was wholly dependant on the husband’s income.  This income enabled her to have a comfortable life, in material terms, which the husband alone funded.  True it is that the compact between the parties was based on the assumption that the wife would not be able to be in paid employment, whilst the parties lived overseas but I do not think it can be said that the husband was reliant on the wife’s efforts to enable him to earn his income.

23. The wife provided the husband with companionship during the marriage.  No doubt she added many pleasant touches and comforts to their expatriate lifestyle, which contributions should not be overlooked but these efforts did not add to the parties’ material circumstances.  As such, I do not think the parties’ contributions, during the marriage can be regarded as essentially equal.

24. Both the [W] and Property M properties have appreciated during the parties' marriage.  In my view, it cannot be said that the wife’s efforts have significantly contributed to this increase in value.  The wife has never lived in the [W] property, which was always intended by the husband to be an investment. 

25. Minor work was done to the property in preparation for its renting and thereafter the husband has engaged a real estate agent in respect of its ongoing management.  The marriage between the parties was incidental to the increase in value of the property.  No doubt, if the marriage between the parties had been longer, she would have benefitted from this accumulation in wealth.

1. In terms of the Property M property, the husband purchased the property, prior to meeting the wife, with his friend Mr C. Their intention was to renovate the property and then sell it at a profit.  The wife was not part of this plan and did not possess the necessary skills to contribute technically to it.  No doubt the wife did some work on the property, over a fairly brief period of time, when compared to the term of the marriage itself.  I would assess the wife’s contributions to both properties as being very modest. 

2. I accept that the wife did make homemaking contributions, during the marriage, in each of the countries in which the parties lived.  I also accept that she was very often unhappy during the parties’ marriage and found expatriate life onerous.  However, in my view, it is not the purpose of these proceedings to compensate the wife for the unhappiness of her marital experience or for the fact that the parties’ relationship did not work out in the manner which each of them would have hoped. 

3. In all the circumstances of this case, I would assess the parties’ respective contributions, at the end of the second stage, in global terms being 95% to the husband and 5% to the wife. 

4. The parties both came into the marriage with accrued superannuation.  During their marriage, neither party contributed further to this superannuation. In the wife’s case, she was not working. In the husband’s case, as he was working outside of Australia, no doubt it was the case that neither he nor his employer were required to contribute to his Australian based superannuation fund.

5. In these circumstances, the parties’ superannuation is easily excised from considerations, which apply to their other property.  As such it is readily amenable to the asset by asset approach to the assessment of contributions. Neither party made any contribution to this superannuation during their marriage. In all the circumstances therefore, it is appropriate that each should retain his or her superannuation entitlements, at the end of the second stage. 

Step Three – section 75(2) factors – the prospective needs of the parties

1. I am now required to consider the various matters set out in section 75(2) and in particular to consider whether any further adjustment should be made in favour of either party. The section 75(2) factors are as follows:

   (a)    the age and state of health of each of the parties;

   (b)    the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;

   (c)    whether either party has the care or control of a child of the marriage who has not attained the age of 18 years;

   (d)    commitments of each of the parties that are necessary to enable the party to support:

   (i)himself or herself; and

   (ii)a child or another person that the party has a duty to maintain;

   (e)    the responsibilities of either party to support any other person;

   (f)     subject to subsection (3) the eligibility of either party for a pension, allowance or benefit under -

   (i)any law of the Commonwealth, of a State or Territory or of another country; or

   (ii)    any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia,

   and the rate of any such pension, allowance or benefit being paid to either party;

   (g)    where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable;

   (h)    the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain adequate income;

   (ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and

   (j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party;

   (k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;

   (l)the need to protect a party who wishes to continue that party’s role as a parent;

   (m)if either party is cohabiting with another person – the financial circumstances relating to the cohabitation;

   (n)the terms of any order made or proposed to be made under section 79 in relation to:

   (i)    the property of the parties; or

   (ii)   vested bankruptcy property in relation to a bankrupt party;

   (na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and

   (o)any other fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and

   (p)the terms of any financial agreement that is binding on the parties.

2. I do not believe that the division of the parties’ matrimonial property, which will follow from the orders made by the court, will effect the earning capacity of either the husband or the wife [section 79(4)(d)].

3. The husband is in his early fifties.  The wife is forty-six.  There is nothing to indicate anything other than that both of them enjoy good health.  Accordingly, in my assessment, both have very many years of productive life before them. 

4. The husband is a skilled worker, who chooses to work overseas.  As a result, he earns a comfortable salary and is entitled to other significant benefits, particularly subsidised accommodation. 

5. It would seem to be the case that, as long as the husband chooses to work overseas, his financial security is assured.  Even in the event he decided to return to this country or New Zealand, I assume that he would be able to continue to earn a comfortable income, given his skills. 

6. The wife has no specific skills or qualifications to speak of, apart from her child care qualification, which she obtained during the marriage.  In the past, she has worked in modestly paid positions in the child care and [hospitality] industry.  It would seem to be the case that she will remain a low income earner for the foreseeable future. 

7. The most valuable “asset”, which a party can take out of a marriage, is a substantial and reliable income earning capacity.[25]  In this case, I am satisfied that the husband has such a capacity.

   [25] See Clauson & Clauson (1995) FLC 92-598 at 81,911

8. However, the marriage between the parties has not of itself impacted upon the wife’s capacity to earn an income.  The evidence indicates that she has returned to the same sort of position and income, which she had at the time the parties met in mid-2004. 

9. Clearly, the end of the parties' marriage has inaugurated a period of financial austerity for the wife.  In material terms, her standard of living is less comfortable than that which she enjoyed, whilst sharing a household with the husband.  However, in my view, the significance of this factor is much reduced when consideration is given to the length of the parties' marriage, which must be considered one of short duration. 

10. During the parties' marriage, the husband provided some level of financial support to the wife’s children. In strictly legal terms,

    
    

    Mr Meldrum had no obligation to support [X] or [Y]. 

11. Pursuant to s.75(2)(o) of the Act, the Court is entitled to take into account the existence or otherwise of a party’s legal obligation to support another person, but this must be done within a framework of “ordinary notions of justice and equity”.[26]

    [26] Robb & Robb (1995) FLC 92-555 at 81,547

12. Neither [X] nor [Y] were permanent members of the parties’ household.  They visited for holidays, for which the husband paid.  In addition, the husband made provision for some of [X]’s education and living expenses, whilst [X] was living in [W]. 

13. It is clear that Mr Meldrum was happy to make these financial arrangements because of his commitment to Ms Dodge. In the unhappy circumstances following the end of the parties’ marriage, he has attempted to put a specific figure on the moneys he spent in this way.

14. As I have indicated to the parties, the exercise which I must undertake is not a strict accounting or arithmetical one. Accordingly, the parties are not entitled to receive back “dollar for dollar”, every sum which they have expended in any particular area.  The husband was happy to subsidise the wife’s children.  No doubt he accepted that this was part and parcel of his relationship with the wife, particularly as, whilst she was living overseas with him, she was unable to earn an income of her own.

15. I take into account the husband’s financial contributions towards [X] and [Y] but, in the overall context of this case, I do not think they can be regarded as significant.  Certainly, I do not think it would be just and equitable that the husband gets the benefit of every dollar he spent in this way.  To a large degree, I regard the husband’s contributions towards the wife’s children as part and parcel of the parties’ expatriate lifestyle, which both voluntarily embraced.

16. Having considered the various 75(2) factors, the only one of relevance is the discrepancy in the income, property and financial resources of the parties concerned [section 75(2)(b)]. The husband is currently earning around five times the amount earned by the wife. This discrepancy is likely to remain for the foreseeable future. 

17. In addition, the husband is well resourced financially.  He has extensive savings and owns two properties.  The wife is in debt and is living in rented accommodation.  This calls for some adjustment in the wife’s favour.

18. I appreciate that it cannot be said the wife’s financial position has deteriorated markedly during the parties’ short relationship.  However, one of the consequences of her marriage to the husband was that she left the workforce and was so unable to make provision for her financial future during that period.  

19. The wife’s commitment to the husband took her out of the paid workforce for around three years.  During this period she was unable to contribute to her superannuation fund.  Accordingly, her preparedness for retirement has suffered a setback.

20. In addition, necessarily, the end of the marriage has been more of a financial set back for her than for the husband, as she has had to re-accommodate and re-equip herself, largely from scratch. I also appreciate that the marriage was not without its financial benefits for the wife.  Chief amongst these benefits is the fact that the husband was able to negotiate the compromise of her various debts from her first marriage.  The considerations must be weighed against one another.

21. In my view, these various factors call for a further modest adjustment in the wife’s favour.  I assess that adjustment as being somewhere in the vicinity of 5% of the parties’ non-superannuation assets. 

Step Four – section 79(2) – is this a just and equitable outcome?

1. The final step in determining property proceedings is to stand back and consider whether the proposed result represents a just and equitable outcome.  Considerations of justice and equity must inform each step of the court’s process and the overall result. 

2. It is all very well to talk in percentage terms, so far as property orders are concerned, but at the end of the day what matters to the parties is what the orders mean in dollars and cents and what effect they will have on their respective long term aspirations and living standards.

3. Ten percent of the parties net non-superannuation assets is represented by the sum of $21,520.00 and ninety percent by the sum of $193,600.00. The wife has in her possession assets in the form of the BMW motor vehicle and her jewellery and other items to the value of $19,400.00. She has a liability, on her credit card, to the value of around $16,000.00. This leaves her in a net asset position of $3,400.00.  Accordingly, she requires a further sum of $18,120.00 from the husband to bring about the income, which I propose. I will round this sum up to $20,000.00.

4. Accordingly, at the end of the proceedings, the wife leaves the marriage with a modest sum of money.  It is a better position than the one in which she found herself at the commencement of the parties’ relationship, when she was significantly in debt. 

5. However, one of the consequences for her, of the parties' marriage, was that she was unable to provide for herself for nearly three years.  As a consequence, it was particularly difficult for her to resume her independent life, following the end of the parties' relationship.

6. In addition, there exists a marked discrepancy between the parties future income earning capacity. On any view, the result, which I envisage, leaves the husband in an overwhelmingly superior financial position, which is warranted given his superior financial contributions.  I am satisfied that this result represents a just and equitable outcome. 

7. It is also my view that it is just and equitable to leave the parties in the same position, vis a vis their superannuation, which each enjoyed at the commencement of their relationship, given that each parties’ fund has remained in a state of suspended financial animation during the course of the parties' marriage.

8. For all these reasons, the orders of the court will be as set out at the commencement of these reasons for judgment.

I certify that the preceding two hundred and forty (240) paragraphs are a true copy of the reasons for judgment of Brown FM

Associate:      P Smith

Date:              19 February 2010