Dusenbury and Searles

[2011] FamCA 101

FAMILY COURT OF AUSTRALIA

DUSENBURY & SEARLES [2011] FamCA 101

FAMILY LAW - PROPERTY – Superannuation – husband will commute his superannuation interest to a lump sum on attaining 60 years of age – proportional division of superannuation lump sum is the only issue in dispute – the superannuation fund trustee was not accorded procedural fairness as required by s 90MZD of the Family Law Act 1975 (Cth) – consequently no superannuation splitting orders can be made – assessment of contributions – husband’s contribution of his inheritance during the marriage was adequately reflected in the proportional division of property earlier in the proceedings – wife’s post separation contributions to children’s care and education are more significant than the husband’s – finding that the parties made equivalent contributions – adjustments – husband failed to disclose assets – Court should not be unduly cautious in making findings in favour of the wife – neither party is likely to engage in future paid employment – no adjustments – superannuation lump sum to be divided equally between the parties

Family Law Act 1975 (Cth) ss 66L, 79, s 90MZD, Part VIIIB
Family Law Rules 2004 r 14.06

Black & Kellner (1992) FLC 92-287
Chang v Su (2002) FLC 93-117
Gabel v Yardley (2008) FLC 93-386
Mallett v Mallett (1984) 156 CLR 605
Norbis v Norbis (1986) 161 CLR 513
Weir & Weir (1993) FLC 92-338

APPLICANT: Mr Dusenbury

RESPONDENT: Ms Searles

FILE NUMBER: NCF 2398 of 2000

DATE DELIVERED: 28 February 2011

PLACE DELIVERED: Newcastle

PLACE HEARD: Newcastle

JUDGMENT OF: Justice Austin

HEARING DATE: 10 February 2011

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Hawkshaw

SOLICITOR FOR THE APPLICANT: Not Applicable

COUNSEL FOR THE RESPONDENT: Mr Theobald

SOLICITOR FOR THE RESPONDENT: Slater & Gordon

Orders

1. The husband shall commute his interest in the State Superannuation Scheme (“the Scheme”), held under Membership Number … or otherwise, upon his attainment of 60 years of age and forthwith pay one half of the commuted lump sum to the wife.

2. For the purpose of implementing Order 1 hereof, within 7 days of the date of these Orders:

   (a)The husband shall provide to SAS Trustee Corporation (‘the trustee”), the trustee of the Scheme:

   (i)Written notification of his election to commute his interest in the Scheme upon his attainment of 60 years of age on 11 April 2011.

   (ii)Written authority and direction to pay the commuted lump sum interest to Slater & Gordon Solicitors, (“the solicitors”).

   (b)The husband shall provide to the solicitors written authority and direction to pay one half of the lump sum received by them from the trustee pursuant to Order (2)(a) hereof to him and the other one half to the wife.

   (c)The wife shall provide:

   (i)To the trustee, a copy of these orders.

   (ii)To the solicitors, written authority and direction to pay one half of the lump sum received by them from the trustee pursuant to Order (2)(a) hereof to her and the other one half to the husband.

3. Otherwise:

   (a)Each party shall be the sole legal and beneficial owner (as between the parties) of all other assets in their respective possession as at the date of these orders, and for that purpose bank accounts are deemed to be in the possession of the person named as the account holder.

   (b)Each party shall be solely liable for and shall indemnify the other against any and all debts attaching or relating to the property in their respective possession and any debts in their respective sole names.

1. In the event of either party refusing or neglecting to sign within 7 days of a written request to do so, any document necessary to implement the terms of these orders the Registrar of the Family Court of Australia at Newcastle is empowered to execute such documents on behalf of the parties pursuant to s 106A of the Family Law Act.

2. Liberty is granted to each of the parties to restore the matter to the list at any time prior to 11 April 2011 on 7 days notice to seek further orders concerning the implementation of these orders.

3. Costs are reserved for 28 days.

4. Any and all outstanding applications are dismissed.

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

FAMILY COURT OF AUSTRALIA AT NEWCASTLE

FILE NUMBER: NCF 2398 of 2000

Mr Dusenbury

Applicant

And

Ms Searles

Respondent

REASONS FOR JUDGMENT

Introduction

1. The pronouncement of property adjustment orders in this litigation will resolve the uncertainty in the minds of the parties that has existed for over a decade.

2. The parties separated in 1999, commenced property adjustment proceedings in 2000, partially distributed their property in 2001, and then adjourned the proceedings pending the commutation of the husband’s superannuation pension in 2011.

3. The proceedings were revived in November 2009 in view of the imminent commutation and the parties’ inability to agree upon how they should share the husband’s superannuation interest.

Background

1. In 1980 the parties married and commenced cohabitation.[1]

   [1] Husband’s affidavit, pars 5-6; Wife’s affidavit, par 6

2. Two children were born to the parties during the marriage, they being M, born in 1981, and N, born in 1984.[2]

   [2] Husband’s affidavit, par 10; Wife’s affidavit, par 9

3. The parties finally separated in August 1999,[3] by which time they had cohabited for over 19 years. They were divorced on or about 10 November 2000,[4] but for ease of identification in this judgment I shall refer to them as the husband and wife.

   [3] Husband’s affidavit, par 11; Wife’s affidavit, par 21

   [4] Husband’s affidavit, par 14; Wife’s affidavit, par 54

4. The parties’ separation followed a period of psychological illness of the husband, which caused him to cease paid employment in March 1999.[5] He then began receiving a pension from his superannuation fund by reason of his condition precluding him from discharging his employment duties.[6]

   [5] Husband’s affidavit, pars 12, 30-32

   [6] Husband’s affidavit, par 39

5. At the end of 1999, only a couple of months after separation, the husband departed Australia to live overseas.[7] The wife said in cross examination that he returned to Australia in about March 2000[8] and remained in the country until shortly after their son suffered serious injuries in a motor vehicle accident in January 2001. Thereafter the husband returned overseas where he has lived ever since.[9]

   [7] Wife’s affidavit, pars 45, 46, 48

   [8] Wife’s affidavit, par 46

   [9] Husband’s affidavit, pars 35-37

6. Following separation the wife and children remained living in the former matrimonial home, but were later compelled to move when the husband was unable to maintain the mortgage repayments. By July 2000 the mortgagee was threatening foreclosure on the mortgage[10] and the former matrimonial home was sold some months later in September 2000. The totality of the sale proceeds were applied to partially discharge the mortgages that were secured over both the former matrimonial home and another investment property at B, Queensland, of which the husband was the sole legal proprietor.[11]

   [10] Exhibit W6

   [11] Wife’s affidavit, par 53

7. As a consequence of the irretrievable breakdown of their marriage, the parties brought proceedings before the Court during 2000 to divide their property interests.[12] Those proceedings were compromised when the parties agreed to divide items of property between them and then adjourn the proceedings pursuant to ss 79(5) and 79(6) of the Family Law Act 1975 (Cth) (“the Act”) until the husband’s superannuation entitlements vested.

   [12] Husband’s affidavit, par 70

8. Despite some uncertainty about the exact date, on or about 11 January 2001 the parties secured consent orders from the Court, which had the following effect:[13]

   a)The wife was required to sell pottery equipment and building fittings, with the proceeds of sale to be divided equally between them (Order 1.1).

   b)The wife was required to deliver up to the husband designated items of artwork (Order 1.2, 1.3).

   c)The parties were otherwise declared the sole owners of other items of personalty in their respective possession (Order 1.4)

   d)The wife was required to transfer to the husband all interest in the realty at B, Queensland, in consideration of which the husband indemnified the wife against any liability attaching to that property (Orders 1.5, 1.6).

   e)The husband was required to indemnify the wife against the loan owed by him to the T Credit Union (Order 1.7).

   f)The proceedings were adjourned before the circuit judge on 12 February 2001 (Order 2), in light of the parties’ acknowledgement that the wife had a residual interest in the husband’s superannuation entitlements (Notation).

   [13] Exhibit W5; Husband’s affidavit, par 71

9. The matter was listed before the Court on 12 February 2001. On that date the Court made further consensual orders to the following effect:

   a)The proceedings were adjourned until the husband’s superannuation entitlements in State Super vested (Order 1.1).

   b)The husband was obliged to commute his current invalidity pension for a lump sum not later than his attainment of 60 years of age (Order 1.4).

10. The parties’ distribution of items of realty and personalty pursuant to the orders made on 11 January 2001 resulted in the husband receiving property of considerably greater net value than the wife. Having regard to the wife’s unchallenged evidence,[14] and the admissions of the husband in cross examination, the husband received property with an approximate net value of $176,000 and the wife received property with an approximate net value of $18,000.

    [14] Wife’s affidavit, par 55

11. The litigation then remained dormant until the husband began email correspondence with the wife’s solicitors in November 2009 concerning resolution of the proceedings.[15] The parties were unable to reach agreement about the division of the husband’s superannuation entitlements and so the matter was subsequently listed for trial.

    [15] Wife’s affidavit, par 78

12. A single expert was appointed to value the husband’s superannuation interests. Neither party contested the single expert’s opinions that:[16]

    a)According to information provided by the superannuation fund trustee, the value of the husband’s superannuation interest as at 16 October 2009 was $629,776.04. That opinion accorded with the husband’s belief.[17]

    b)The husband has the right to elect to commute all or part of his current fortnightly pension entitlement within the six months periods immediately preceding and following his attainment of 60 years of age, in which event he will receive a lump sum. The election must therefore be made between 11 October 2010 and 11 October 2011.

    c)In the event of an election to commute all entitlements upon attainment of 60 years of age, the lump sum payable to the husband will be $424,292.00. That opinion also accorded with the husband’s belief.[18]

    d)No income tax will be payable by the husband upon any commuted lump sum received following his attainment of 60 years of age. That opinion also accorded with the husband’s belief.[19]

    [16] Affidavit of Mr S filed 16 November 2010

    [17] Husband’s affidavit, par 49

    [18] Husband’s affidavit, par 82

    [19] Husband’s affidavit, par 86

13. The parties mutually conducted the trial on the basis that the husband would commute the entirety of his superannuation entitlement upon his attainment of 60 years of age, consistently with the provisions of Order 1.4 made on 12 February 2001. Consequently, only the proportional division between them of the commuted lump sum of $424,292.00 was in issue. Neither sought to unravel the prior distribution of realty and personalty achieved in January 2001, but each acknowledged that the disparity of that distribution should be factored into the final exercise of power under s 79 of the Act.

14. Because the argument was confined to the proportional division of the commuted lump sum, neither party compiled a balance sheet representing the matrimonial pool of property currently available for distribution. Each party ignored an earlier procedural order of the Court to file an agreed balance sheet[20] and each party requested the Court to embark upon the trial without a comprehensive evaluation of the parties’ respective current financial circumstances.

    [20] Order 5 made on 24 September 2010

15. It is unorthodox not to begin the exercise of property adjustment by establishing the matrimonial pool of property available for distribution between the parties. However, the exercise of discretion by the Court in the adjustment of the parties’ property interests is not compromised by acquiescence to the parties’ approach if it is accepted that the parties’ earlier interim or partial distribution of property was proper and that the husband’s superannuation interest is the only remaining asset or financial resource worth contesting.

Proposal and evidence of the applicant husband

1. The husband did not seek the orders set out within his Amended Application filed on 25 February 2010. The husband also abandoned his earlier contention that the superannuation splitting power found with Part VIIIB of the Act could not apply to his superannuation interest. He was correct to do so in light of authority (see Gabel v Yardley (2008) FLC 93-386 at 82,957-82,960 and 82,969-82,970).

2. The husband tendered a minute of the fresh orders proposed by him.[21] The husband sought a series of superannuation splitting orders, designed to allocate to the wife a base percentage of 20% in his superannuation interest.

   [21] Exhibit H1

3. Although the orders were not explicit, and the husband actually adduced evidence to the contrary,[22] before the trial commenced the husband confirmed that he intended to commute the entirety of his interest rather than continue to receive a pension.

   [22] Husband’s affidavit, par 87

4. It was not, however, possible to make any superannuation splitting orders because the husband failed to adduce any evidence of his compliance with Rule 14.06 of the Family Law Rules, and so there was no evidence of the superannuation fund trustee having been accorded procedural fairness, as required by s 90MZD of the Act.

5. Irrespective, in support of his proposal that the wife receive a much lesser cash sum or superannuation interest than she was seeking, the husband relied upon his affidavit filed on 25 June 2010.

6. The husband also sought to rely upon two affidavits recently sworn by him on 7 and 10 February 2011, but was not permitted to do so over objection by the wife. The husband failed to comply with the procedural orders of the Court about the readiness of the proceedings for trial[23] and the late affidavits were not even served upon the wife until the very moment that the trial was to commence. Understandably, the wife was caught by surprise and her prejudice could not be cured, other than by adjournment. The husband declined to apply for an adjournment and risk an order that he pay the costs of the wife thrown away.

   [23] Orders 5-6 made on 5 November 2010

Proposal and evidence of the respondent wife

1. The wife pressed for Orders 1-4 inclusive set out within her Amended Response filed on 2 December 2010. The wife abandoned her alternative application for Orders 5-14 set out in that document.

2. The effect of the wife’s application was to seek orders compelling the husband’s commutation of his superannuation interest upon his attainment of 60 years of age, and the payment of one half of the commuted lump sum to the wife.

3. The wife accepted that the orders she proposed were not superannuation splitting orders under Part VIIIB of the Act and that the orders would not therefore bind the superannuation fund trustee who was not a party to the proceedings, and furthermore, that the superannuation fund trustee may well be obliged under the terms and conditions of the fund to pay the entirety of the commuted lump sum to the husband. The Court’s orders would only bind the husband to thereafter pay the stipulated proportion of the lump sum to the wife.

4. In support of her proposal the wife relied upon her affidavit filed on 20 January 2011 and her Financial Statement filed on 18 February 2010.

Assessment of contributions

1. At the commencement of their cohabitation neither party introduced any asset of significant value. The wife deposed that their meagre assets at that time were equivalent in value[24] and the husband did not demur.[25]

   [24] Wife’s affidavit, par 24

   [25] Husband’s affidavit, pars 15, 17

2. Neither party then had any superannuation interest.[26] The husband began making superannuation contributions in 1980.[27]

   [26] Wife’s affidavit, par 25; Husband’s affidavit, pars 18-19

   [27] Husband’s affidavit, par 43-46

3. Each party made appropriate concessions in cross examination about how hard the other toiled for the benefit of their family unit during their cohabitation. The parties were in general agreement that the husband was the primary breadwinner for the family and that the wife was primarily responsible for household duties and the care and supervision of the children. The parties chose to arrange their matrimonial affairs in that way. They each contributed their available time for the benefit of one another and their children.

4. There is no presumption of equality in the assessment of spouses’ contributions under s 79 of the Act (see Mallett v Mallett (1984) 156 CLR 605 at 610, 613, 625, 639-640, 647). However, often the evidence will necessarily lead to a conclusion that the spouses’ contributions were relatively equal when contributions as a homemaker and parent are properly afforded substantial and not merely token recognition (see Mallett at 609, 623, 636, 646).

5. Although dissenting as to the outcome of the appeal, it was observed by Mason J at 625:

   No doubt a conclusion in favour of equality of contribution will be more readily reached where the property in issue is the matrimonial home or superannuation benefits or pension entitlements and the marriage is of long standing. It will be otherwise when the property in issue consists of assets acquired by one party whose ability and energy has enabled the establishment or conduct of an extensive business enterprise to which the other party has made no financial contribution and where that other party’s role does not extend beyond that of homemaker and parent.

   and by Deane J at 640-641:

   … in cases involving a long marriage where the parties have adopted the attitude that their marriage constituted a practical union of both lives and property, the notion of equality is likely to offer an acceptable and useful starting point at least as regards those assets, such as the matrimonial home, ancillary possessions and savings and investments for retirement, which are fairly to be seen as truly representing the fruits of a totality of efforts of wage earning, homemaking and mutual support.

6. Those observations were cited without criticism in Norbis v Norbis (1986) 161 CLR 513 at 537.

7. It is permissible, and indeed customary, for the Court to assess spouses’ contributions globally, by taking account of the whole of the parties’ assets and ascertaining their entitlements by reference to the value of the whole of that property without differentiating between particular assets (see Norbis at 520-521, 523, 534-535, 541). It cannot be required of the Court that it assess contributions with mathematical precision (see Norbis at 522).

8. The parties were in agreement that, up until their separation in 1999, their contributions were equivalent save for an inheritance received by the husband. Curiously, the inheritance of approximately $106,000 was not mentioned by either party in their affidavits. There was some disparity about how the inheritance was spent by the husband, but each party conceded that an inference should be drawn that a substantial proportion of it was contributed to the matrimonial pool of property.

1. Leaving aside for the moment the argument about disparate post-separation contributions, the credit that must be afforded to the husband for the introduction of the inheritance to the matrimonial pool is more than adequately reflected in the proportional division of realty and personalty between the parties pursuant to the orders made in January 2001. The husband then received property worth some $158,000 more than the property received by the wife. Even if the wife’s estimate of the value to be attributed to the assets then retained by the parties erred in her favour, more than sufficient provision was made for the husband in that distribution as consideration for his contribution of the inheritance to the parties’ pool of property.

2. Comparison of the parties’ post-separation contributions only serves to demonstrate that the husband’s contribution of the inheritance during cohabitation was offset to some degree by the wife’s superior post-separation contributions.

3. At the time of separation in about August 1999 the children, who were both then minors, remained living with the wife in the former matrimonial home. The eldest child was just short of attaining her majority and the youngest child was 15 years of age. The wife and children were obliged to vacate the former matrimonial home by mid 2000 so that the property could be sold to avert foreclosure of the mortgage by the mortgagee. The husband asserted that he contributed by meeting mortgage repayments and providing the wife and children with accommodation in the former matrimonial home for a period of about 18 months after separation, but I do not accept that his contributions of that nature were anywhere near so significant. The wife conceded that the husband may have made a single monthly repayment about the time of his return from overseas in about March 2000 after several months away, but that his non-payment of the mortgage was the very reason the property had to be sold.[28] I accept her evidence, which was partially corroborated by the written demand of the mortgagee dated 6 July 2000.[29]

   [28] Wife’s affidavit, par 48

   [29] Exhibit W6

4. The husband conceded that he paid no child support to the wife for the eldest child,[30] who attained her majority in September 1999 shortly after the parties’ separation. Although the husband paid all of the child support assessed for the youngest child, the child support assessment and payments for him ceased when he attained his majority in January 2002.

   [30] Wife’s affidavit, par 51

5. In the case of each child, the wife bore a heavy burden in continuing to support them financially and emotionally following the parties’ separation. In the case of the eldest child, she continued her education at tertiary level throughout the 2000 academic year and for the first half of the 2001 academic year. She later spent a further four years at university from 2003 to 2006 inclusive. In the case of the youngest child, he was gravely injured in a traffic accident in January 2001.[31] He spent some time convalescing in hospital and then returned home where he was nursed by the wife throughout his rehabilitation.[32] He was physically disabled and seriously depressed for almost the entirety of that year. The husband conceded that he returned overseas at that time because he “needed to get away as [he] was so upset by the whole ordeal [the child’s accident]”. The husband left the wife to deal with the physical and emotional carnage. The youngest child resumed and completed his secondary education in the 2002 and 2003 academic years, over which period he continued to receive psychological therapy. He then attended tertiary education for two years in 2004 and 2005.

   [31] Wife’s affidavit, par 57

   [32] Wife’s affidavit, pars 60-61

6. Section 66L of the Act makes provision for parents to financially maintain their child beyond the attainment of his or her majority in circumstances of continuance of education, or when mental or physical disability precludes the child from being self-supportive. Although the wife made no application against the husband for the payment of child maintenance in respect of either child pursuant to that provision, the circumstances of both children would likely have justified such an application.

7. The burden of supporting the children financially, physically, and emotionally in the circumstances described fell solely to the wife for some time following separation and is a contribution which is properly recognised under s 79 of the Act.

8. Apart from perhaps the payment of a monthly mortgage repayment, the husband made no financial contribution of significance after the parties’ separation. The husband ceased making superannuation contributions as soon as his entitlement to a pension crystallised in 1999, before the parties’ separated.[33] He did not continue to supplement his superannuation interest by further financial contributions post separation. Although the wife made much of the transition of the husband’s superannuation interest into the payment phase in, and his exclusive receipt of the pension from, 1999 there is no evidence that those circumstances have resulted in a lesser lump sum now being available on commutation of the pension than would have been available had the husband not had resort to the pension over the intervening years.

   [33] Husband’s affidavit, pars 53, 55

9. The husband contended that his overall contributions were superior to those of the wife and justified a 55/45% division of assets in his favour. The wife asserted that their overall contributions were equal and warranted an equal division of assets.

10. The husband’s overall contributions were probably marginally more significant than the wife’s because of the inheritance, but the husband was adequately compensated for that differential by his receipt of significantly more property than the wife at the time of the interim or partial distribution in January 2001. Otherwise, I am persuaded of the overall equivalence of the parties’ contributions and accept the submission of the wife about an equal entitlement to the husband’s remaining superannuation interest.

Adjustment

1. The wife contended that no adjustment to the parties’ contribution-based entitlements was warranted by factors considered pursuant to s 79(4)(d)-(g) of the Act. Conversely, the husband asserted that not only was an adjustment in his favour warranted, but that the adjustment should be 25% in magnitude.

2. The only factors upon which the husband premised his submission, bearing in mind the evidence actually admitted over or in the absence of objection, were the differing ages of the parties, the respective state of health of the parties, and the comparative financial circumstances of the parties.

3. The husband is currently 59 years of age. He will attain the age of 60 years in less than two months time, at which time his superannuation interest will be commuted. The share of the commuted lump sum that he receives pursuant to these orders will replace the fortnightly pension that he would otherwise receive for life.

4. The husband asserts that he has not been gainfully employed since his entitlement to the pension was triggered by his psychological condition in 1999. He contends that he has no prospect of returning to work and is without an income earning capacity. The medical evidence adduced by the husband is more than 10 years old,[34] but his continuous receipt of a pension over the intervening years and the age of the husband leads me to conclude that it is improbable he will work again.

   [34] Husband’s affidavit, Annexures THK-1, THK-2, THK-3

5. The husband presently lives with his second spouse overseas and intends to continue doing so. There is no evidence before the Court about the husband’s entitlement to any form of Australian or overseas pension, allowance or benefit consequent upon his receipt of his lump sum superannuation interest.

6. Unfortunately, the husband’s financial circumstances remain quite uncertain.

7. On 3 February 2010 the husband was ordered to file and serve an Amended Initiating Application and Financial Statement by 3 March 2010.[35] He did not do so. He filed Amended Applications on 22 and 25 February 2010, but no Financial Statement. The husband served on the wife, without filing, a single page document entitled “Financial Statement of [the husband]” sworn on 19 February 2010, which stated in part:[36]

   My wife [his second spouse] has ownership of two native houses on the island of [D], however these are not my assets because foreigners cannot own land in [that nation]. I have no other assets in Australia or anywhere else at this time.

   [35] Order 2

   [36] Exhibit W4

8. After failing to disclose in the affidavit his proprietary interest in any asset at all, the husband further deposed:[37]

   I have no other assets or livelihood other than my superannuation pension for my old age years.

   [37] Husband’s affidavit, par 104

9. Those sworn statements were and are false, as the husband was impelled to concede in cross examination.

10. The husband admitted raising a loan of about $27,000 from the T Credit Union in about October 1999, shortly following separation, which money he contributed, at least in part, to the acquisition of two parcels of property overseas. A monthly statement in relation to the loan account is in evidence.[38] The husband also conceded that he withdrew money from the parties’ joint credit account held with the E Credit Union to make repayments on his own new loan from the T Credit Union, at least for a period of time in early 2000.[39]

    [38] Exhibit W1

    [39] Exhibit W2

11. The husband said in cross examination that the properties overseas were purchased for about $2,000 each, but I am reluctant to accept his uncorroborated word for that. His credibility was found wanting and the asserted value of those properties is hardly consistent with the value of the loan he raised for the purpose of their acquisition.

12. The husband asserted that the two parcels of property overseas are held in the name of his present spouse. Although he disavowed any legal or beneficial interest in either of those properties, it is clear from emails sent by the husband to the wife’s solicitors that the husband perceives he has sufficient interest in the properties that he can influence what is done with them.

13. In an email sent by the husband on 5 February 2010 the husband said:[40]

    My intention is to sell a small property here an (sic) to take that finance to go to court in the early part of 2011.

    [40] Wife’s affidavit, Annexure C

14. In an earlier email sent by the husband on 3 November 2009 the husband said:[41]

    A legal challenge mounted properly is going to be expensive, I will need to sell off some of my assets here in order to do it (sic).

    [41] Wife’s affidavit, Annexure B

15. The husband obviously has assets he did not disclose.

16. The husband admitted his current retention of the majority of the artworks he received under the orders made in January 2001. He said that he did not declare his ownership of those chattels because they had been in his family for so long that he did not regard them as matrimonial assets. I do not accept his explanation, which is inconsistent with their declaration by him as assets in his Financial Statement in June 2000[42] and their inclusion in the partial or interim property settlement achieved in January 2001.[43]

    [42] Exhibit W3, par G11

    [43] Exhibit W5, Orders 2-3

17. The husband also admitted that he owned a car, motor scooter and furniture overseas. His explanation for the omission of those assets from his Financial Statement sworn on 19 February 2010 was that he did not regard them as sufficiently important to mention.

18. The husband did adduce evidence of his liability to the T Credit Union now amounting to $45,000,[44] but he did not explain how or why that debt had increased from the debit balance of only $19,299 for which he was liable in January 2000.[45]

    [44] Husband’s affidavit, par 78

    [45] Exhibit W2

19. It is long established that parties are obliged to make comprehensive disclosure of their financial circumstances in property adjustment proceedings conducted under Part VIII of the Act. The wife contended that because of the husband’s failure to disclose his assets, other than under cross examination, the Court should not be unduly cautious in making findings in her favour. The wife did not solicit orders making more generous provision for her than would otherwise be the case (see Black & Kellner (1992) FLC 92-287; Weir & Weir (1993) FLC 92-338 at 79,593-79,594; Chang v Su (2002) FLC 93-117 at 89,197-89,198). As already mentioned, the wife was content to press her case on the basis that the extent of her entitlement was an equal share of the husband’s commuted pension.

20. I am satisfied that the husband failed to make proper disclosure of his assets, either in a timely fashion or at all. I am satisfied that his failings in that regard were either deliberate or recklessly indifferent to the consequences. It may be that the husband is secretly in possession of other assets unknown to the wife or the Court, but I am not called upon to make that finding. I accept the wife’s submission and have not been unduly cautious in making findings that favour her.

21. The wife is now 53 years of age. Despite some past ill health,[46] she is currently in reasonable health. Although the husband believes that the wife has the skills and health to obtain further employment and accrue superannuation entitlements in the future,[47] there is no evidence of her being in any paid employment since before the parties’ final separation. The wife remarried in July 2001[48] and has been financially supported by her current spouse ever since.[49] I conclude that arrangement is unlikely to change.

    [46] Wife’s affidavit, par 73

    [47] Husband’s affidavit, par 95

    [48] Wife’s affidavit, par 62

    [49] Wife’s affidavit, par 63

22. The wife confirmed her financial circumstances as set out in her affidavit,[50] subject to the exhaustion of all savings.

    [50] Wife’s affidavit, pars 74-75

23. I am persuaded that neither party can demonstrate an entitlement to an adjustment of their contribution-based entitlements. I reject the husband’s submission that there should be any adjustment, let alone one as large as he proposed. I also reject the husband’s submission that his overall entitlement should be measured at 80%.

24. The net result of my findings and conclusions therefore is that the parties should take an equal share of the available property.

Just and equitable orders

1. Since the parties agree that the only asset or financial resource to be divided between them is the husband’s superannuation interest, which will vest as his property upon commutation of his pension on 11 April 2010, it follows that they must each receive an equal share of that lump sum.

2. For reasons earlier articulated, there is some risk that upon commutation the lump sum will be paid by the superannuation fund trustee to the husband and dissipated by him before the wife’s one half share is paid to her, thereby frustrating the Court’s orders. The orders are therefore couched in terms designed to obviate that risk.

I certify that the preceding seventy-two (72) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Austin delivered on 28 February 2011.

Associate: 

Date:  28 February 2011