Eakins and Eakins
[2013] FCCA 1114
•21 August 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| EAKINS & EAKINS | [2013] FCCA 1114 |
| Catchwords: FAMILY LAW – Section 75(2) property adjustment – application for adult child maintenance pursuant to s.66L. |
| Legislation: Family Law Act 1975, ss.75(2), 66L, 90MT(4) Federal Circuit Court Rules, Regulation 1.05 |
| AJO v GRO [2005] FamCA 707 Burgoyne & Burgoyne (1978) FLC 90-467 Kowali & Kowali (1981) FLC 91-092 Pierce & Pierce (1999) FLC 92-844 Ferraro (1993) FLC 92-335 NHC & RCH [2004] FamCA 633 Williams & Williams [2007] FamCA 313 Stanford [2012] HCA 52 Hickey & Hickey & Attorney General of Australia (2003) FLC 93-143 |
| Applicant: | MS EAKINS |
| Respondent: | MR EAKINS |
| File Number: | PAC 2066 of 2012 |
| Judgment of: | Judge Harman |
| Hearing date: | 8 August 2013 |
| Date of Last Submission: | 8 August 2013 |
| Delivered at: | Parramatta |
| Delivered on: | 21 August 2013 |
REPRESENTATION
| Counsel for the Applicant: | Mr Batey |
| Solicitors for the Applicant: | Aaron Legal |
| Counsel for the Respondent: | Ms Murphy |
ORDERS
The Orders of 24 September 2012 are discharged.
Within two (2) months from the date of these Orders the wife is to do all things necessary by way of refinance or otherwise to ensure the husband is released from any liability for the mortgage to the Westpac Bank currently secured over the property at Property R, [R] New South Wales (former matrimonial home).
Simultaneously with compliance by the wife with the preceding Order the husband shall do all things necessary to transfer his right title and interest in Property R, [R] New South Wales being the whole of the land comprised in Folio Identifier [omitted] being the former matrimonial home to the wife.
The wife shall continue to pay, as they fall due all regular instalments in respect of the mortgage, council rates, water rates and household insurance in respect of the former matrimonial home.
In the event the wife fails to comply with the terms of paragraph 3 hereto, each party shall take all necessary steps and execute all necessary documents to cause the former matrimonial home to be sold by private treaty at the earliest possible date at a price to be agreed on between the parties and failing such agreement to be determined by the president of the New South Wales Division of the Australian Property Institute or his nominee and that the proceeds of the said sale be disbursed as follows:
(a)Payment of agents commission and advertising expenses and legal expenses of sale;
(b)Discharge of the mortgage to Westpac; and
(c)The net balance to the wife
That in the event that the former matrimonial home fails to be sold by private treaty within a period of three (3) months hereof, then each party shall take all necessary steps and execute all necessary documents to cause the property to be sold by auction at the earliest possible date at a reserve price to be agreed upon between the parties and failing such agreement to be determined by the President of the New South Wales Division of the Australian Property Institute or his nominee and that the proceeds of the said sale be disbursed in accordance with the previous Order.
Within two (2) months of the date of these Orders the husband shall do the following:
(a)Pay to the wife the sum of FORTY SEVEN THOUSAND DOLLARS ($47,000); and
(b)Do all things necessary by way of refinance or otherwise to ensure the wife is released from any liability for the mortgage to Westpac currently secured over the Property W, [W] New South Wales property being Folio Identifier: [omitted] (“the [W] property”);
The husband shall continue to pay as they fall due, all regular instalments in respect of the mortgage, council rates, water rates and household insurance in respect of the [W] property and forthwith pay any arrears in respect of any of the said instalments.
In the event the husband fails to comply with the terms of paragraph 8 hereto, each party shall take all necessary steps and execute all necessary documents to cause the [W] property to be sold by private treaty at the earliest possible date at a price to be agreed on between the parties and failing such agreement to be determined by the president of the New South Wales Division of the Australian Property Institute or his nominee and that the proceeds of the said sale be disbursed as follows:
(a)Payment of agents commission and advertising expenses and legal expenses of sale;
(b)Discharge of the mortgages to Westpac;
(c)Payment of FORTY SEVEN THOUSAND DOLLARS ($47,000) to the Wife; and
(d)Any remaining balance to the husband.
In the event that the [W] property fails to be sold by private treaty within a period of three (3) months hereof, then each party shall take all necessary steps and execute all necessary documents to cause the [W] property to be sold by auction at the earliest possible date at a reserve price to be agreed upon between the parties and failing such agreement to be determined by the President of the New South Wales Division of the Australian Property Institute or his nominee and that the proceeds of the said sale be disbursed in accordance with the previous Order.
The husband shall indemnify the wife in relation to all outgoings in respect of the [W] property including all payments in respect of the mortgage, rates, taxes, charges, insurance and expenses in relation to repairs and improvements and any other sums due or accruing in respect of the said property.
Pending settlement in accordance with these Orders:
(a)The husband shall be responsible for all outgoings for the [W] property including but not limited to insurances, council rates and water rates; and
(b)The wife shall be responsible for all outgoings for the [R], and [T] properties including but not limited to insurances, council rates and water rates;
From the date of these Orders the husband be declared solely entitled to the following:
(a)The Honda VTR 197A motorbike registration number [omitted];
(b)The 1970 Trailer registration number [omitted];
(c)The 2005 Mazda 6 motor vehicle registered in the husband’s name;
(d)All superannuation entitlements in the husband’s name;
(e)All accounts with any financial institution in the husband’s name; and
(f)The joint Westpac Classic Plus Account.
From the date of these Orders the wife be declared solely entitled to the following:
(a)Her 2011 Suzuki Swift registration number [omitted] in the wife’s name and the wife shall indemnify the husband for any liability encumbering the said motor vehicle.
(b)The wife’s business known as “[Ms Eakins - C]”;
(c)All superannuation entitlements in the wife’s name; and
(d)All accounts with any financial institution in the wife’s name.
The Husband shall do all acts and things necessary and give all consents and execute all documents and writings necessary within 24 hours of being requested to do so, to ensure that the sale, refinancing or Transfer of any property subject to these Orders proceeds without undue delay.
In the event of the parties refusing or neglecting to sign any documents herein including the necessary documents to effect such sale, transfer or assignment within seven (7) days of being requested by a party, then the Registrar or Deputy Registrar of the Federal Circuit Court, pursuant to Section 106A(1) of the Family Law Act 1975, is hereby appointed and empowered, by consent, to execute such documents in the name of the defaulting party and to do all acts and things necessary to give validity and operation to such documents and the defaulting party shall pay the costs of the non-defaulting party on an indemnity basis simultaneously with the receipt of any monies to be received pursuant to these orders.
The husband and wife shall do acts and things and give all consents and execute all documents and writings necessary to give effect to the Orders made herein.
Subject to the preceding, from the date of these Orders that the husband and wife be declared to have the sole right, title and interest in:
(a)Any chattels, goods, motor vehicles, furnishings and any other property which are at the date hereof in their possession respectively; and
(b)Any monies, shares, debentures, superannuation and leave entitlements, which stand in, their sole name respectively at the date hereof.
Until the sale or transfer of any of the properties the parties shall not redraw any available funds or further encumber the properties without the written consent of the other party.
Upon the expiration of the Appeal period and in the event that no appeal is lodged that all exhibits then be returned to the party who tendered same and that all material produced on subpoena be returned to the person or organisation who produced same.
All outstanding applications and responses are withdrawn and dismissed and all issues are removed from the list of cases awaiting hearing (save any application for costs which either party seeks to press).
In the event that either party wishes to pursue an application for costs then:
(a)The party wishing to pursue such application shall within 14 days of today’s date, file a minute of order and written submission in support of such orders;
(b)The party responding to same shall, within a period of 14 days after service, file and serve written submissions in response; and
(c)The applicant pursuing an order for costs shall be entitled, within a period of 7 days of service of the responding submission, to file any written submission in reply.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PARRAMATTA |
PAC 2066 of 2012
| MS EAKINS |
Applicant
And
| MR EAKINS |
Respondent
REASONS FOR JUDGMENT
These are proceedings involving competing applications for financial relief.
The parties to the proceedings are husband and wife, namely, the applicant wife Ms Eakins and the respondent husband Mr Eakins.
History of Proceedings
These proceedings were commenced by initiating application filed 16 May 2012 (being some four months after the party’s separation).
A response to the application was filed by Mr Eakins 18 June 2012.
The proceedings came before a Registrar of the Family Court 19 June 2012. On that date the proceedings were adjourned for a brief period. The purpose of the adjournment was noted as “for terms” suggesting a consensual resolution. No such Terms of Settlement materialised.
On 21 August 2012 the proceedings again came before a Registrar of the Family Court. On that date proceedings were transferred to the Federal Magistrates Court (as it then was) and directions made for each party to file certain further documents.
On 24 September 2012 the proceedings first came before me. On that date a number of interim orders were made by consent (regarding the sale of two investment properties and application of proceeds of sale arising therefrom) and the proceedings otherwise listed for trial 24 April 2013.
On 24 April 2013 the proceedings could not be heard due to competing priorities within the list. The matter was accordingly adjourned for hearing 8 August 2013 and marked as “not reached” to ensure that priority was afforded. Upon the proceedings being adjourned leave was granted to the wife to amend her application so as to seek orders which would have the effect of vesting 55% of the total pool of property in the wife.
The matter came before the Court 8 August 2013 and proceeded to hearing. Evidence and submissions were concluded that day.
It is noteworthy that on all but one of the occasions upon which the proceedings have come before the Court that Mr Eakins (the respondent) has been legally represented. This is so notwithstanding that attorneys for Mr Eakins have never filed a Notice of Address for Service in these proceedings nor sought leave to appear. Counsel has appeared at hearing on a direct brief.
As was to become clear from the evidence of the parties each has incurred legal fees with respect to the matter. Ms Eakins had estimated, during her cross examination, that she has incurred total fees of approximately $53,000 (the vast majority of which is unpaid and all but a sum of approximately $5,300 remains unpaid). Mr Eakins estimated that he has incurred fees with respect to advice and representation of approximately $20,000 all of which are paid.
Material Considered
Prior to commencement of the hearing Counsel for each of the parties filed a Case Outline document enumerating the material which was relied upon by them. I have read and considered each of the documents identified which, for the sake of completeness, comprise:
In the case of Ms Eakins:
Her further amended application filed 19 July 2013;
Her affidavit of evidence in chief sworn and filed 18 July 2013;
Her financial statement sworn and filed 18 July 2013;
An affidavit of an adult child of the parties [X] sworn and filed 19 July 2013; and
A statement of financial circumstances of [X] sworn and filed 19 July 2013;
The above material filed by [X] (21 years of age at the date of hearing) arises in the context of an application by Ms Eakins pursuant to s.66L of the Family Law Act 1975 for maintenance orders for that child notwithstanding that [X] is over 18 years of age.
In the case of Mr Eakins I have read and considered:
His amended response filed 6 August 2013;
His affidavit of evidence in chief sworn and filed 18 July 2013; and
His financial statement sworn and filed 5 August 2013.
In addition to the above material I have been assisted by Counsel for each of the parties providing a Case Outline document setting out a summary of submissions as well as a number of other matters (including the address of the agreed and contentious matters regarding the balance sheet of property available to divide).
A number of documents have also been tendered into evidence comprising:
a)In the case of Ms Eakins:
i)Exhibit W1 – her Case Outline document;
ii)Exhibit W2 – an updated (and agreed) schedule of assets and liabilities;
iii)Exhibit W3 – paragraphs 4 – 9 of Mr Eakins’ previously filed affidavits being affidavits sworn and filed 20 September 2012 and 18 April 2013 respectively;
iv)Exhibit W4 – previous financial statements by Mr Eakins sworn and filed as above;
v)Exhibit W5 – wage slip for the husband for the period ending 11 April 2013; and
vi)Exhibit W6 – wage slip for the husband for the period ending 7 June, 2012.
b)In the case of Mr Eakins I have received the following exhibits:
i)Exhibit H1 – case outline document;
ii)Exhibit H2 – procedural fairness correspondence from [S] Super;
iii)Exhibit H3 – material from the Westpac Bank (comprising statements for a premium option home loan account for the period 28 September 2011 to 26 March 2012 – and being a portion of the statements for that account already copies of which were already annexed to the husband’s trial affidavit);
iv)Exhibit H4 – a schedule prepared by the wife of payments made from the above account (which document had been called for and produced by the wife during her cross examination);
v)Exhibit H5 – a schedule prepared by the wife with respect to specific transactions alleged by husband to have been performed by the wife (as addressed in paragraphs 59 – 61 of his trial affidavit). This document had, again, been called for and produced by the wife during her cross examination; and
vi)Exhibit H6 – records with respect to payment of the mortgage encumbering the property at [W] (which records, again, by and large are a duplication of that annexed to the husband’s affidavit material).
To the extent that material has been produced by the wife in response to a call for the production and then tendered by the husband and I make clear that such tender has occurred on the husband’s application and, presumably, on his instructions.
As will be noted from the material considered, each of the parties has amended the application or response initially filed by them. This has had the consequence that:
a)In the case of Ms Eakins – an application for adult child maintenance pursuant to s.66L of the Family Law Act 1975 was joined by the further amended initiating application filed 19 July 2013; and
b)In the case of Mr Eakins the relief proposed by him was amended by the orders sought in his amended response filed 6 August 2013 both as to a cash payment sought by him (to be made to him by the wife) and proposing, for the first time in the proceedings, that a superannuation splitting order be made pursuant to s.90MT(4).
Neither party has taken any objection to the amendment affected by the other. It is on that basis that I proceeded to hear and determine the matter by reference to the relief sought by each in their amended document. Had objection been taken (particularly as regards the addition of the s.66L prayer) submissions would have been required as to why such amendment should be permitted after dates for trial had been fixed. It has not arisen through the absence of any application by either party to exclude such amendment.
Chronology of events and history of the parties relationship
I have set out below the chronology of events proposed by Ms Eakins (and as incorporated within the case outline document filed in
Ms Eakins’ case). Two amendments thereto had been made relating to:
a)The cohabitation of the parties; and
b)The introduction of funds in the sum of $8,433 to the parties’ joint Westpac Bank account in March 2012.
The above amendments had been made as:
a)The wife asserts in her affidavit material (paragraph 4 thereof) that the parties commenced to cohabit 18 months prior to marriage. The husband asserts in his material that the parties commenced to cohabit in approximately March 1987 and that being approximately 18 months prior to marriage. Thus, this date (March 1987), would appear to represent an agreed fact as between the parties (rather than as alleged in the case outline March 1985);
b)As regards the transactions referred to in the wife’s chronology for February and March 2012 respectively (being a withdrawal of $9,685 from the parties joint Westpac account and reintroduction of a sum of $8,433) I am satisfied, particularly by reference to annexure ‘A’ to the husband’s affidavit material, that the introduction of the latter sum occurred as a consequence of the deposit of the husbands wages to the account rather than a specific payment referable to the transactions alluded to by the wife (although the husband’s evidence concedes that his wage’s, for that fortnight, included a payment by way of refund for an overpayment made from funds the subject of the first withdrawal and thus the wife’s evidence is not inaccurate simply misdescribed).
Subject to these two amendments, however, I adopt the chronology of the wife and, for reasons that will become apparent, I accept her as a witness of credit truth. Wherever there is dispute between the evidence of the parties, I accept and prefer the wife’s evidence over that of the husband.
Thus the chronology of events is as follows:
1964 Husband born, currently 49 years of age.
1964 Wife born, currently 48 years of age.
18 January 1982 Husband commences employment with [B] as a [omitted].
Late 1984 Husband purchases Property P. Purchase price $50,000and CBA mortgage of $48,000. March 1987 Parties commence co-habitation. Wife works as a [omitted] and studying [omitted] at University of [omitted] and contributing to the [P] property. [omitted] 1988 The parties marry.
Wife completes her [omitted] studies and commences working part time at [omitted].[omitted] 1992 Party’s daughter [X] born. [omitted] 1992 The wife returns to part time work with [omitted] when [X] was 16 weeks old. October 1992 Husband leaves employment with [B] and joins [omitted]. Husband paid out $7,000 from superannuation. $7,891 remains preserved with [A] Superannuation Fund. Husband’s wages reduced from$45,000 to $25,000. 1993 The wife returns to full time work with [omitted]. [X] is cared for by the wife’s parents. 1994 Wife retrains as a [omitted].
[X] continues to be cared for by the wife’s parents from time to time until she commences school in 1996.
1995 Wife returns to [occupation omitted]. Wife becomes pregnant with [Y].
The parties sell Property P for approximately $260,000.Parties purchase land at Property R [R] (“the [R] property”) for about $105,000 for the land. Later building a [omitted] Home for about $114,000. The parties had a mortgage of about $40,000 with Westpac Bank.
Parties and [X] lived rent free with wife’s parents for about 5 months whilst house was being built.
Parties move into Property R [R]
[omitted] 1996 Parties’ daughter [Y] born. [omitted] 1996 The wife returns to work when [Y] is 12 weeks old. The wife’s parents assist with caring for both [X] and [Y] whilst the wife commences work as a [omitted]. 1997 [X] commences school at [omitted] Primary School. [X] is cared for before and after school and during the school holidays by the wife’s parents. 2000 The Wife diagnosed with cancer. Wife undergoes surgery and radiotherapy. The wife was off work for about 6 months. 2001 Parties purchase Property W (“the [W] property”) for approximately $261,000 using the [R] property as security.
[Y] commences school at [omitted] Primary School.2001 The [W] property is rented out for about $340 per week. The parties jointly top up the mortgage shortfall of about $300 - $400 per month. 2005 Wife remains in remission from cancer. 2006 The Parties purchase Property O [O] Queensland (“the [O] property”) for the sum of $417,000, using the [R] property as security. (The [O] property mortgage was about $440,000). 2006 The [O] property is rented out for approximately $403 per week. The parties jointly top up the mortgage by about $900 per month. 2007 The parties purchase Property T Queensland (“the [T] property”) for the sum of $310,000 using the [R] property as security.(The [T] property mortgage was about $315,000).
The [T] property is rented out for the sum of approximately $294 per week. The parties jointly top up the mortgage by about $400 - $500 per month.
2007 The parties purchase shares through [omitted] Pty Limited in the sum of $50,000 using their Westpac Equity Access Loan with the [R] property as security. The shares are valued at about $30,000. January 2012 The Husband issued a Termination Notice to the tenant’s living at the [W] property without the consent of the Wife. 11 January 2012 The parties separate on a final basis. [Y] and [X] live with the mother. February 2012 The Husband withdraws the sum of $9,685.94 from the joint Westpac account (account number 195301) to pay out his Mazda 2005 vehicle. March 2012 The Husband deposits the sum of $8433 into the joint Westpac account (which amount represents the husband’s fortnightly pay from his employment as a [occupation omitted] and includes reimbursement of funds relating to a leased motor vehicle payment of which had previously been made by the husband from funds Westpac above). April 2012 The Husband commences living at the [W] property. 24 April 2012 The Husband stops depositing his income into the joint Westpac accounts which service the 5 mortgages.
The Husband continues to use the wife’s Westpac Visa account to make post separation transactions in the sum of $1,591.29.
May 2012 The Husband advises the wife he has changed the bills for the [R] property into her sole name and cancelling the insurance on her motor vehicle.
May 2012 The Husband removes the trailer and running machine from the [R] home without the consent of the wife. 11 May 2012 The wife contacts the Child Support Agency. 16 May 2012 The Wife files her Initiating Application and Financial Statement in the Family Court. 8 June 2012 The Husband makes 2 withdrawals of funds from the wife’s personal Westpac Account, in the sum of $3,330 and $1,000 without the wife’s consent. The wife is unable to make her mortgage payments. June 2012 The Husband re-deposits the sum of $1,000 into the parties joint Classic Plus Account And withdraws the same amount from the [omitted] Westpac Flexi Teller. June 2012 Westpac suspends the party’s joint telephone banking accounts. 18 June 2012 The Husband files his Response and Financial Statement. 20 June 2012 The Husband re-deposits the sum of $3,330.37 into the joint Westpac Visa Account for joint debts. 20 June 2012 The parties attend the first return date. Matter did not settle, adjourned to 21 August 2012. 12 July 2012 The Husband lodged an Objection to the amount of Child support payment. 26 July 2012 The Husband organised for [Y] to live with him on a week about basis. 17 August 2012 Valuation of [R] property in the sum of $670,000 and [W] in the sum of $360,000 by [name omitted]. 21 August 2012 The parties attended Court for the adjourned date. Valuations completed for the [R] and [W] properties. No settlement was reached the matter was transferred to the Federal Magistrates Court (now Federal Circuit Court) 20 September
2012Wife e files her updated Affidavit.
Husband files his Affidavit.24 September
2012The parties come to an agreement to sell the [O] and [T] properties, the wife retain the [R] property and the Husband retains the [W] property and his defined [S] super fund. The parties are unable to agree on post separation contributions. The Husband requests more furniture from the [R] home. October 2012 [Y] returned to live with the wife full time.
[X] is diagnosed with ADHD, chronic depression and anxiety. [X] is reliant on the wife for financial and emotional support.
2012 The [O] property is sold $399,000 and the shortfall of $55,000 was applied to the [R] property mortgage.
The share holding is sold and the shortfall of $14,919 was applied to the [R] property mortgage.
February 2013 [Y] commences Year 11 at [omitted] High School. 22 March 2013 The Wife files her updated Affidavit. 24 March 2013 The Wife files her Amended Initiating Application. April 2013 The [T] property is sold for $290,000. Any shortfall is to be applied to the [R] property mortgage. (Shortfall anticipated at $45,000). April 2013 The wife files her Further Amended Initiating Application.
Banking accounts
A number of issues have been raised regarding the post separation contributions made by party and particularly arising from the operation by each of banking accounts (whether joint or in individual names) and specific transactions relating to a variety of such accounts.
I note that the parties have introduced into evidence (primarily through annexure to their affidavit material) a volume of statements relating to different accounts operated by them at different times and particularly:
a)The parties’ premium option home loan account (an account ending in [5]) for the period 28 September 2011 to 26 March 2012 and, in addition, the period 27 December 2012 to 17 July 2013;
b)A variable rate investment loan account operated by the parties with respect to an investment property in [T] and covering the period 21 December 2011 to 21 November 2012;
c)A Westpac choice account in the husband’s name (account ending [3]) and which would appear to cover the period 9 May 2012 through to 1 February 2013;
d)A rocket home loan account (account ending [4]) relating to a property owned by the parties at [W] (being a mortgage account) and covering the period 19 December 2011 to 19 March 2013;
e)Statements with respect to Westpac Altitude Visa account in the wife’s name and covering a period 26 April 2012 to 27 May 2012 (one statement); and
f)Statements with respect to Westpac Choice account (ending [1]) in the wife’s name for the period 11 May 2012 to 8 June 2012.
Significantly, the above are the only statements apparently produced by the parties (and certainly the only documents introduced into evidence). This is so notwithstanding that by operation of Orders made by both the Registrar of the Family Court and myself and by operation of pre-action procedures (operating at the commencement of the proceedings when filed in the Family Court and operating by reference to Regulation 1.05 of the Federal Circuit Court Rules within this Court) the parties were obliged to provide full and complete disclosure and neither has raised any allegation or concern that same has not occurred. Thus it is concerning and no evidence is adduced as to why other documents of relevance and significance are not produced particularly relating to:
a)A [T] Credit Union account in the name of Ms Eakins;
b)The balance of statements with respect to the Visa card account (in the wife’s name as primary card holder but to which account Mr Eakins had access and was a secondary card holder); and
c)A joint Westpac Savings account operated by the parties (a Classic Plus account).
Both of the above accounts have been cross examined upon and/or the subject of the evidence of the parties or either of them and yet neither has sought to introduce any document with respect to those accounts.
The above is perhaps synonymous of the manner in which the parties and, in particular, Mr Eakins, have chosen to conduct their case. There are, particularly in the case of Mr Eakins, a number of areas of contention which could and should have been addressed through the tender of material in the nature of bank statements or other records and I had particularly raised with Counsel for Mr Eakins, during the wife’s cross examination, the failure to put to the wife statements for the Visa card account which was the subject of particularly vigorous examination. Be that as it may the material that the parties have chosen to place before the Court is that identified above.
The parties cross examination
Ms Eakins
Ms Eakins (as the applicant) was cross examined first.
The majority of cross examination of Ms Eakins focused upon suggested notional “addbacks”. These, as identified in the case outline document filed by Counsel for Mr Eakins, comprised three discrete contentions, namely:
a)An alleged premature distribution by Ms Eakins of funds held by her in a [T] Credit Union account totalling $10,287.23 at separation;
b)Expenditure by the wife on legal fees from joint funds (being from the Option Mortgage account) suggested to total $5,005.65. Ultimately, Ms Eakins concedes 2 withdrawals comprising $2,000 and $3,379 respectively (thus totalling $5,379);
c)Suggested expenditure by the wife post separation and from a joint account of the parties (into which, at least for some of that period, the wages of both parties were deposited), totalling $17,672.
Whilst the cross examination of Ms Eakins with respect to those issues was extensive her evidence and responses are reflected, in summary, by two aspect of her evidence namely:
a)All withdrawals by her (without conceding the specific amounts alleged by Mr Eakins) and especially those from the [T] Credit Union account where necessary and used to meet living expenses for herself and the two children (and which living expenses I will return to shortly); and
b)As regards withdrawals from joint funds Ms Eakins gave evidence that “I was concerned to not withdraw money from the joint account as the mortgages were paid from that account and Mr Eakins[the husband] refused to discuss anything with me”. Indeed Ms Eakins has indicated in her affidavit evidence (paragraph 53) that when she had attempted, on one occasion, to discuss day to day financial issues with Mr Eakins [post separation] that he responded to her “fuck off you stupid bitch you sort it out”.
Ms Eakins’ evidence, which I accept, indicates clearly that her withdrawals were:
a)Intended to meet living expenses for herself and the two children of the relationship (both, at that point, living with her in the former matrimonial home);
b)Undertaken in an environment whereby she had some real uncertainty as to future contribution by Mr Eakins;
c)Not demonstrated as inconsistent with pre separation patterns of expenditure (particularly as regards payments towards the Visa Card account which, whilst in Ms Eakins’ name, both parties had access to); and
d)
In the context of ongoing withdrawals by Mr Eakins from the joint account, the use of the Visa account and, as alleged by
Ms Eakins and which I accept, withdrawals affected by
Mr Eakins upon Ms Eakins’ personal Westpac account being transactions totalling $4,330.37.
Two of the documents tendered in Mr Eakins’ case are documents prepared and produced by Ms Eakins. Those documents relate to and seek to address the allegations of Mr Eakins as to Ms Eakins’ suggested access to and use of funds from joint accounts.
Exhibit H4 addresses specifically each withdrawal affected by
Ms Eakins from the Option Home Loan account for the period 17 January 2012 to 10 May 2012.
The transactions which are conceded by Ms Eakins as having been affected by her total $7,707.55.
In addition to the above payments the exhibit is demonstrative of:
a)Payments of $5,335 (and representing 6 individual transactions totalling that amount) for construction or repair of a Pergola at the former matrimonial home (which work had been contracted prior to separation);
b)Payment of a plumbing bill $275;
c)Payment for pest control; and
d)Two payments with respect to legal fees (referred to above).
The expenditure conceded by Ms Eakins ($7,707.55) over a period of five months is far from excessive particularly when one has regard to:
a)Ms Eakins residing with the two children of the marriage both of whom were in their latter teens and thus consuming, in all regards, at a level equivalent to an adult;
b)Ms Eakins residing in a large home which, during her cross examination, she indicated utilised electricity for air conditioning (and the period covered being summer and autumn);
c)The pattern of expenditure of the parties prior to separation;
d)Ms Eakins servicing debt jointly incurred (especially as regards the Visa card) prior to separation.
Expenditure from the accounts, in total, is greater than that referred to in the schedule Exhibit ‘H4’. However, this expenditure has also included the servicing of mortgages with respect to (then) four parcels of real estate owned by the parties and comprising the home at [R] and (then) three investment properties at [W], [T] and [O] respectively.
Mr Eakins had asserted in his evidence that Ms Eakins had, from the joint option mortgage account and for the period addressed above, affected withdrawals totalling $19,762 (paragraph 80 of his trial affidavit). No particularisation of same is attempted by Mr Eakins save to annex (Annexure ‘B’) copies of the statements for that account. It is not the role of the Court to seek to calculate or extrapolate that which is alleged by Mr Eakins particularly in circumstances whereby the following paragraphs of his affidavit (particularly paragraphs 80 – 82 inclusive) do enumerate a number of specific transactions alleged to be attributable to Ms Eakins and falling well short of the total alleged.
Further, whilst Mr Eakins has not sought to assist the Court by identifying the transactions alleged to demonstrate the expenditure of Ms Eakins he has prepared schedules which seek to quantify contributions alleged to be made by him to various expenses and/or by deposit to the parties Premium Option Home Loan account. The latter document (Annexure ‘C’ to the husbands trial affidavit) is particularly illuminating noting that the husband, as regards the expenditure undertaken by him for the period May to August 2012 includes
“Ms Eakins’s half share total owed $4,720.64; total amount payable to Mr Eakins $4,720.64”.Thus it would appear Mr Eakins was of the view at the time of completing that document and calculations contained therein that Ms Eakins was, in some fashion, liable to reimburse him for amounts that he had expended including (the majority of that expenditure) mortgage payments with respect to the property at [W] in which Mr Eakins was then residing.
Similarly the schedule of funds deposited to the joint account by
Mr Eakins is calculated by Mr Eakins as reflecting a total introduction of funds by him of $25,195.22. The total introduction of funds by
Ms Eakins is suggested to be $15,519.20.
The document then concludes with “short fall of funds contributed by Ms Eakins $9,676.02” suggested to be representative of the greater funds introduced by Mr Eakins.
What the above schedule prepared by Mr Eakins does not take into account, however, is that a sum of $8,434.24 was introduced by
Mr Eakins 29 March 2012 and noted by him in his schedule of comprising “fortnightly pay including $10,000 refund from lease termination – base payment less tax”.
Mr Eakins had withdrawn an amount of $9,685.95 from the same account to apply to that car lease liability (and those generating the refund). Mr Eakins does not seek to afford any benefit to Ms Eakins for her contribution (those funds being withdrawn from the joint account) to the funds thus “reintroduced” by Mr Eakins to the account. At its best such inadvertence in calculation is disingenuous. However, it would appear to also reflect the niggardly approach adopted by
Mr Eakins towards the resolution of financial issues and the apportionment of contribution by each.
If adjustment is made for the amount that was, in fact, withdrawn by Mr Eakins from the same joint account to which his deposits were then made then the parties’ contributions are roughly equal (and favouring Ms Eakins by $9.92).
The other aspect of financial contribution and financial arrangements generally since separation which crystallised during Ms Eakins’ cross examination was the fact that each of the two investment properties sold (pursuant to orders made by consent between the parties) generated a short fall – i.e. each property was sold for less than the total amount outstanding to the Westpac Bank by way of mortgage. Those shortfalls were added to the encumbrance recorded against title of the [R] property and which the wife has remained in occupation of and serviced the liabilities relating to or encumbering.
Clearly each of the parties has contributed to the various investment property mortgages since separation (see Annexure ‘C’ to the husband’s affidavit and Annexure ‘D’ to the wife’s).
The husband has urged that his post separation contribution, through the servicing of mortgage liabilities, is greater than the wife’s in that the total payments made by him to the date of hearing slightly exceed those of the wife. However it is to be noted that this has arisen principally as the mortgage encumbering the [W] property, in which the husband has chosen to reside, is greater in quantum than that encumbering the [R] property and thus the principle and interest payments required of the husband are greater than those required of the wife for her occupation of the [R] property. However, each has had the benefit of use and occupation of a property (to their benefit and as they are each entitled). Such occupation has also come to the detriment of the wife in that the [W] property, when previously tenanted, had generated a net income available to the parties which has thus not been available as a consequence of the husband’s occupation.
Cross examination of the wife was otherwise substantially focused upon the expenses alleged to be incurred by the wife and as set out in her Statement of Financial Circumstances.
A number of specific expenses were attacked including that which the wife alleges is expended by her with respect to food, electricity, gas and rates.
I am not satisfied that the wife has grossly inflated any figure contained within her Statement of Financial Circumstances.
With respect to rates it was put to the wife that the amount claimed by her was vastly in excess of that which would, in reality, be incurred with respect to council rates for the [R] property. However, rates would also include water usage rates and would have included, until the sale of each of the investment properties not long before the hearing of the proceedings, rates with respect to each of the investment properties at [T] and [O]. The wife has particularised her payments with respect to such rates in Annexure ‘D’ to her trial affidavit and if that is taken into account the figures claimed by the wife are far from inflated.
Similarly, the wife’s claimed expenditure with respect to gas and electricity are, on the basis of the large home occupied by her, its occupancy by, effectively, three adults and the use of electricity to provide heating and cooling to the property, are far from excessive. The same applies with respect to food and the other specific expenses put to the wife.
A significant element of the wife’s case, particularly as regards the claim for section 66L maintenance, relates to significant medical expenses incurred by the eldest of the two children of the marriage [X] (now 21 years of age).
The husband concedes in his material (paragraph 62) that:
“In about 2007 when [X] was about 15 she suffered from depression and spent some time in [omitted] Children’s Hospital. [X] has been hospitalised about twice for depression. [X] has been prescribed anti-depressants. Both Ms Eakins and I supported [X] through a difficult time”.
What is not apparent from the husband’s evidence (and which I accept from the evidence of the wife and the adult child [X]) is that [X]’s “difficult times” are far from over and have been in a continuum from 2007 to present and continuing.
[X] was (thankfully) not required for cross examination. However, I thus accept the evidence lead by her as to her expenses. Whilst the wife was criticised for seeking to quantify a specific contribution sought by her from the husband (her application seeking only that the husband pay “one half of all medical costs for the parties adult daughter [X]” such quantification was apparent from both the wife’s material and that deposed to by [X]. The expenses in fact incurred (or recommended with respect to medical treatment or prescriptions) are specifically particularised at paragraphs 95 – 103 of the wife’s affidavit and at paragraphs 9 – 17 inclusive of [X]’s affidavit.
Overall I am satisfied that Ms Eakins gave her evidence in a frank and truthful fashion and that I can and do accept her evidence as truthful.
Mr Eakins
Mr Eakins was then cross examined.
Cross examination of Mr Eakins largely focused upon discrepancies between Mr Eakins’ evidence by comparison to his previous affidavits and financial statements and other documents ultimately tendered in Ms Eakins’ case.
Principle amongst the above inconsistencies were:
The factual circumstances of the purchase by Mr Eakins of a property in Property P, [P].
a)There is no issue between the parties that this property was purchased shortly prior to the parties meeting (it having been purchased in December 1984 and the parties agreeing that they met and commenced a “dating” relationship in early 1985).
b)In his two earlier affidavits (paragraph 9 of each) Mr Eakins had deposed that the property was purchased for $50,000 and that he had borrowed a sum of $48,000. The balance of the purchase price was suggested to have been obtained by way of mortgage from the CBC Bank (now National Bank). Mr Eakins deposed to having savings of five or six thousand dollars which were also applied towards a deposit, stamp duty and legal fees.
In his trial affidavit (the third affidavit sworn by Mr Eakins) his evidence had become (paragraphs 7 to 9):
Paragraph 7 – “In December 1984 I purchased a residential property at Property P, [P] for $50,000.”
Paragraph 8 – “I borrowed $38,000 from the National Australia Bank (NAB) at [P][branch omitted] for that purchase. I also had a deposit of $12,000 accumulated from savings whilst I worked at [B]. I used that deposit to make up the difference in the total purchase price of $50,000 with the mortgage of $38,000”.
Paragraph 9 – “I also had additional savings at that time which covered relevant stamp duty and legal fees for the purchase”.
Ms Eakins had not sought to cavil with the evidence given by Mr Eakins in his earlier two affidavits which suggested minimal equity in that property at the time the parties met and commenced a “dating” relationship. However, Ms Eakins did not concede that deposed to by Mr Eakins in his affidavit 18 July 2013 (which, but for the matter having been not reached in April 2013, would not have come before the Court and the Court would have been asked to adjudicate the matter based on Mr Eakins’ earlier evidence which was accepted by Ms Eakins).
Mr Eakins did not seek to produce any document to corroborate either version of events and particularly did not offer any explanation for the change in his evidence other than his “memory”.
Whilst I accept that there may have been some difficulty in
Mr Eakins obtaining documents from the bank (having merged with another and the documents being of some antiquity) it was perfectly open to Mr Eakins to undertake LPI searches which would have demonstrated both the purchase price of the property, the date of the transaction, produced a copy of the mortgage and the amount borrowed (or at least upon which stamp duty was (then) paid).
Mr Eakins’ Financial Statements (all three of them) would appear to have minimised the gross salary or wage position
c)The earlier financial statements referred (respectively) to gross income of $2,048 per week and $2,013 per week.
d)By the Financial Statement relied upon at trial and sworn 5 August 2013 this gross salary or wage had reduced to $1,053 per week.
e)Mr Eakins’ explanation for same was that he had formed the belief, from reconsidering the form, that the specific question “total salary or wages before (emphasis added) tax” required that he produce a net figure for his salary. I do not accept that explanation.
It was conceded and demonstrated by the wage slips tendered in Ms Eakins’ case (same having been produced by the husband’s employer in response to a subpoena) that the husband’s salary, at the time that his financial statement was sworn, was in the vicinity of $4,508.21 per fortnight ($2,254 per week).
Mr Eakins ultimately conceded in cross examination that his annual salary, by reference to his last tax return and his present income level, was in the vicinity of $110,000 to $120,000 per annum. The financial statement upon which he relied at hearing suggested an annual salary of $54,756 (or about half).
Other discrepancies with respect to Mr Eakins’ Financial Statements
f)Mr Eakins’ Financial Statement sworn and filed 5 August 2013 alleged total personal expenditure by reference to Part G “personal expenditure” and Part N, of $3,174 (substantially exceeding Mr Eakins’ suggested gross income quite). However, it became apparent during Mr Eakins’ cross examination that there were a number of discrepancies and/or inaccuracies which required adjustment including:
i)Mr Eakins had claimed his income tax as an expense to be deducted from income. Thus the income tax of $581 comprised a portion of the total expenses claimed but had already been deducted. In fact, the tax suggested, even if added back, still reflected a significant understatement by Mr Eakins of his gross income.
ii)Mr Eakins had claimed “books and magazines” as an expense of $466 per week. In cross examination Mr Eakins indicated that this was clearly an error and that the $466 was intended to be his mortgage payment. However, the mortgage payment was also included in Part G (question 21) being $430 per week and thus the claimed expenditure of $466 per week can also be discounted and, in fact, entirely removed.
iii)Part G (question 32) included amounts for fuel, food and “other general expenditure” of $570. These were, however, further and more specifically enumerated in Part N and thus would appear to reflect a duplication of at least $570.
g)Without further considering such issue the above three discrepancies would suggest that a deduction of at least $1,036 (items ii and iii above) should be made from the total expenditure asserted by the husband and thus his total expenditure, even if all other figures are accepted, would be $2,138.
h)On the above basis the salary in fact earned by Mr Eakins is in excess of expenditure rather than perilously and disastrously in arrears.
[X]’s medical condition
When cross examined with respect to [X]’s medical condition
Mr Eakins’ evidence was particularly pernickety and niggardly.
Mr Eakins’ asserted that the figures deposed to by both Ms Eakins and [X] were “estimates, not concrete figures supported by documents”.
Mr Eakins refused to concede that [X] experienced any difficulty in engaging in employment and asserted that she had passed a number of exams for the purpose of entering [omitted]. This would appear to overlook, if not disingenuously reject, the evidence of [X] that on the basis of a report provided by her psychiatrist (which had been required to complete her medical entrance conditions and which was annexed to material filed) that she was rejected.
Mr Eakins asserted that benefits are available to [X] which had not been claimed by her particularly Centrelink benefits. However,
Mr Eakins could not point to any specific entitlement nor any step that he had taken that would assist in such entitlements being realised. In any event such amounts would, in all probability, not be properly taken into account in dealing with or addressing the application.
During his cross examination Mr Eakins also identified that a purported lender (Ms L - see paragraph 50 of his Financial Statement) was his “partner”. No reference to Ms L was contained within any of Mr Eakins’ material save paragraph 50 of the Financial Statement in which Ms L was disclosed as a “lender”. Whether the relationship with Ms L involves cohabitation or otherwise cannot be found as she is disclosed in the filed evidence purely as a lender.
At the conclusion of Mr Eakins’ evidence I was less than satisfied as to the truthfulness and veracity of portions of his evidence particularly those relating to the discrepancies identified above and which would not have been apparent to the Court but for his vigorous cross examination by Counsel for Ms Eakins and the tender of prior inconsistent statements made, on oath, by Mr Eakins.
It is on the above basis that I have indicated, from the outset, that I prefer the evidence of Ms Eakins wherever there is factual dispute between the parties.
Parties proposals
The orders, in fact, sought by each of the parties are set out in their respective Case Outlines.
The orders sought by Ms Eakins are:
1. That the Orders of 24 September 2012 be discharged.
2. That within two (2) months from the date of these Orders the wife do the following do all things necessary by way of refinance or otherwise to ensure the husband is released from any liability for the mortgage to the Westpac Bank currently secured over the property at Property R, [R] New South Wales (former matrimonial home).
3. That simultaneously with compliance by the wife with the preceding Order that the husband do all things necessary to transfer his right title and interest in Property R, [R] New South Wales being the whole of the land comprised in Folio Identifier [omitted] being the former matrimonial home to the wife.
4. That the wife continue to pay, as they fall due all regular instalments in respect of the mortgage, council rates, water rates and household insurance in respect of the former matrimonial home.
5. In the event the wife fails to comply with the terms of paragraph 3 hereto, each party take all necessary steps and execute all necessary documents to cause the former matrimonial home to be sold by private treaty at the earliest possible date at a price to be agreed on between the parties and failing such agreement to be determined by the president of the New South Wales Division of the Australian Property Institute or his nominee and that the proceeds of the said sale be disbursed as follows:
a. Payment of agents commission and advertising expenses and legal expenses of sale;
b. Discharge of the mortgage to Westpac;
c. The net balance to the wife
6. That in the event that the matrimonial home fails to be sold by private treaty within a period of three (3) months hereof, then each party take all necessary steps and execute all necessary documents to cause the property to be sold by auction at the earliest possible date at a reserve price to be agreed upon between the parties and failing such agreement to be determined by the President of the New South Wales Division of the Australian Property Institute or his nominee and that the proceeds of the said sale be disbursed in accordance with the previous Order.
7. That within two (2) months of the date of these Orders the husband do the following:
a. Pay to the wife the sum of FORTY SEVEN THOUSAND DOLLARS ($47,000) and
b. Do all things necessary by way of refinance or otherwise to ensure the wife is released from any liability for the mortgage to Westpac currently secured over the Property W, [W] New South Wales Property being Folio Identifier: [omitted] (“the [W] property”);
8. That the husband continue to pay as they fall due, all regular instalments in respect of the mortgage, council rates, water rates and household insurance in respect of the [W] property and forthwith pay any arrears in respect of any of the paid instalments.
9. That in the event the husband fails to comply with the terms of paragraph 9 hereto, each party take all necessary steps and execute all necessary documents to cause the [W] property to be sold by private treaty at the earliest possible date at a price to be agreed on between the parties and failing such agreement to be determined by the president of the New South Wales Division of the Australian Property Institute or his nominee and that the proceeds of the said sale be disbursed as follows:
a. Payment of agents commission and advertising expenses and legal expenses of sale;
b. Discharge of the mortgages to Westpac;
c. Payment of FORTY SEVEN THOUSAND DOLLARS ($47,000) to the Wife;
d. Any remaining balance to the husband.
10. That in the event that the [W] property fails to be sold by private treaty within a period of three (3) months hereof, then each party take all necessary steps and execute all necessary documents to cause the [W] property to be sold by auction at the earliest possible date at a reserve price to be agreed upon between the parties and failing such agreement to be determined by the President of the New South Wales Division of the Australian Property Institute or his nominee and that the proceeds of the said sale be disbursed in accordance with the previous Order.
11. That the husband shall indemnify the wife in relation to all outgoings in respect of the [W] property including all payments in respect of the mortgage, rates, taxes, charges, insurance and expenses in relation to repairs and improvements and any other sums due or accruing in respect of the said property.
12. That pending settlement in accordance with these Orders:
a. The husband shall be responsible for all outgoings for the [W] property including but not limited to insurances, council rates and water rates;
b. The wife shall be responsible for all outgoings for the [R], and [T] properties including but not limited to insurances, council rates and water rates;
13. From the date of these Orders the husband be declared solely entitled to the following:
a. The Honda VTR 197A motorbike registration number [omitted];
b. The 1970 Trailer registration number [omitted];
c. The 2005 Mazda 6 motor vehicle registered in the husband’s name;
d. All superannuation entitlements in the husband’s name;
e. All accounts with any financial institution in the husband’s name;
f. The joint Westpac Classic Plus Account.
14. From the date of these Orders the wife be declared solely entitled to the following:
a. Her 2011 Suzuki Swift registration number [omitted] in the wife’s name and the wife shall indemnify the husband for any liability encumbering the said motor vehicle.
b. The wife’s business known as “[Ms Eakins – C]”;
c. All superannuation entitlements in the wife’s name; and
d. All accounts with any financial institution in the wife’s name.
15. That the Husband do all acts and things necessary and give all consents and execute all documents and writings necessary within 24 hours of being requested to do so, to ensure that the sale, refinancing or Transfer of any property subject to these Orders proceeds without undue delay.
16. That in the event of the parties refusing or neglecting to sign any documents herein including the necessary documents to effect such sale, transfer or assignment within seven (7) days of being requested by a party, then the Registrar or Deputy Registrar of the Federal Magistrates Court, pursuant to Section 106A(1) of the Family Law Act, 1975, is hereby appointed and empowered, by consent, to execute such documents in the name of the defaulting party and to do all acts and things necessary to give validity and operation to such documents and the defaulting party shall pay the costs of the non-defaulting party on an indemnity basis simultaneously with the receipt of any monies to be received pursuant to these orders.
17. That the husband and wife do acts and things and give all consents and execute all documents and writings necessary to give effect to the Orders made herein.
18. That subject to the preceding, from the date of these Orders that the Husband and Wife be declared to have the sole right, title and interest in:-
a. Any chattels, goods, motor vehicles, furnishings and any other property which are at the date hereof in their possession respectively;
b. Any monies, shares, debentures, superannuation and leave entitlements, which stand in, their sole name respectively at the date hereof.
19. That until the sale or transfer of any of the properties the parties shall not redraw any available funds or further encumber the properties without the written consent of the other party.
20. That pursuant to s.66L of The Family Law Act 1975 the husband contribute 50% of all medical costs for the parties adult daughter [X] ([X]”) born [in] 1992
21. That the husband pay for the wife’s costs of these proceedings.
In the case of Mr Eakins the relief is as follows:
1. That within two calendar months of the date of making these orders the Wife shall:
a. Pay to the Husband the sum of $112,000.00
b. Do all acts and things and sign all documents necessary to discharge the mortgage to the Westpac Bank encumbering the property situate at and known as Property R, [R] in the State of New South Wales more particularly described in Certificate of Title Folio Identifier [omitted] (hereinafter referred to as “the [R] property”);
c.Transfer to the Husband all the Wife’s right, title and interest in the property situate at and known as Property W, [W] in the State of New South Wales more particularly described in Certificate of Title Folio Identifier [omitted] (hereinafter referred to as “the [W] property”);
4. That forthwith upon the Wife complying with order 1 herein, the Husband shall:
a. Transfer to the Wife all the Husband’s right, title and interest in the [R] property.
b. Do all acts and things and sign all documents necessary to discharge the mortgage to the Westpac Bank encumbering the [W] property.
5. In the event that the Wife fails to comply with Order 1 within 3 months of the date of these orders then both the Husband and the Wife shall list for sale and sell the [R] property with an agent agreed to by the parties or in the absence of agreement as nominated by the President for the time being of the Real Estate Institute of New South Wales at a list price as agreed or in the absence of agreement as nominated by the listing agent and the sale proceeds shall be distributed as follows:
a.In payment of costs of sale including conveyancing and legal costs;
b. In full discharge of the mortgage to the Westpac Bank encumbering the [R] property;
c. $112,000 plus interest in accordance with the Family Law Rules to the Husband; and
d. The balance to the Wife.
7. That pending settlement in accordance with these orders the Wife shall:
a. Pay all monthly instalments of mortgage payable for the [R] property to the Westpac Bank.
b. Pay all other outgoings for the [R] property.
8. That pending settlement in accordance with these orders the Husband shall:-
a. Pay all monthly instalments of mortgage payable for the [W] property to the Westpac Bank.
b. Pay all other outgoings for the [W] property.
9. That a base amount of $100,000 is allocated, as required by s.90MT(4) of the Family Law Act 1975 to Ms Eakins out of
Mr Eakins’ interest in the [S] Superannuation.
10. That in accordance with paragraph 90MT(1)(a) of the Family Law Ct 1975:
a. Ms Eakins is entitled to be paid the amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001; and
b. Mr Eakins’ entitlement to payment of his interest in the [S] Superannuation and the entitlement of such other person to whom a splittable payment may be payable, is correspondingly reduced by force of this order.
11. That the Trustee of the [S] Superannuation (“the Trustee”) shall do all such acts and things and sign all such documents as may be necessary to:
a. calculate in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001, the entitlement created for Ms Eakins by order 9; and
b. Pay the entitlement whenever the Trustee makes a splittable payment out of Mr Eakins’ interest in the [S] Superannuation.
12. That these orders have effect from the operative time for this order is four days after service of the orders on the Trustee.
13. That this order binds the Trustee of the [S] Superannuation.
14. That forthwith the Husband shall be declared the sole owner in law and equity of the following:
a. The Honda VTR 197A motorbike registration n. [omitted]
a. The 1970 Trailer registration no. [omitted]; and
b. 2005 Mazda 6 motor vehicle registered in the Husband’s name;
c. All superannuation entitlements in the Husband’s name not provided for in these orders; and
d. All accounts with any financial institutions in the Husband’s name.
10. That forthwith the Wife shall be declared the sole owner in law and equity of the following:
a. The 2011 Suzuki motor vehicle in the Wife’s name and the Wife shall forthwith and forever hereafter indemnify the Husband for any liability encumbering the said 2011 Suzuki motor vehicle.
b. The Wife’s business known as ‘[Ms Eakins – C];
c. All superannuation entitlements in the Wife’s name; and
d. All accounts with any financial institutions in the Wife’s name.
11. That forthwith each party shall be declared the sole owner in law and equity of any property real and personal not otherwise referred to in these orders and both the Husband and Wife shall indemnify each other for any liability encumbering any item of property belonging to the Husband and Wife respectively.
12. That the application sought by the Wife pursuant to section 66L of the Family Law Act 1975 be dismissed.
Legislative framework
I am required, by reference to cases such as Ferraro (1993) FLC 92-335, Hickey & Hickey & Attorney General of Australia (2003) FLC 93-143, AJO v GRO [2005] FamCA 707 and Stanford [2012] HCA 52, to adopt a three step approach being:
a)To identify the pool of property available (usually at the date of trial and subject to the issue of notional add backs raised by Mr Eakins);
b)To assess the parties contributions; and
c)To determine what adjustment, if any, should be made pursuant to s.75(2).
During each stage of the determination I am required to be satisfied that justice and equity is served and that the outcome produced by the orders ultimately made reflects justice and equity. Lest I am wrong in that interpretation of the authorities I shall, in addition, address justice and equity as a separate (fourth) step at the conclusion.
As was observed by the Full Court in Burgoyne & Burgoyne (1978) FLC90-467
“it is impossible for the Court to determine whether any particular order is just and equitable without first determining the nature and extent of the properties of the parties at the time that the Court is making orders”.
The above passage is particularly germane to these proceedings having regard to the issue of notional add backs agitated by Mr Eakins.
What is the asset pool
The superannuation and non-superannuation assets available for division between the parties were ultimately agreed between the parties and as set out in Exhibit ‘W2’. They reflect a pool of property as follows:
Assets
| No. | Owners: | Description: | Value: |
| 1. | Husband | Property W | $360,000 |
| 2. | Wife | Property R | $670,000 |
| 3. | Wife | Suzuki | Nil |
| 4. | Husband | Mazda | $6,000 |
| 5. | Husband | Honda | $3,500 |
| 6. | Husband | Trailer | $500 |
| 7. | Wife | [T] Credit Union | Nil |
| 8. | Husband | [P] Credit Union | Nil |
| 9. | Husband | 226 [omitted] Shares @ $4.53 | $1,024 (as at 7.8.13) |
| 10. | Joint | Household Furniture | $3,000 |
| 11. | Husband | Monies taken by husband | $1,000 |
| TOTAL GROSS ASSETS | $1,045,024 |
Liabilities
| No. | Owners: | Description: | Value: |
| 12. | Wife | Home mortgage on Property R | $158,500 |
| incorporating shortfall on | |||
| Property T | |||
| 13. | Husband | Mortgage on Property W | $254,000 |
| 14. | Joint | Shortfall on Property T | Included above |
| 15. | Wife | Suzuki | Nil |
| TOTAL | $412,500 | ||
| NET | $632,524 |
Superannuation
| No. | Owners: | Description: | Value: |
| 16. | Husband | [S] | $321,891 |
| 17. | Husband | [omitted] | $41,953 |
| 18. | Husband | [A] Super | $7,891 |
| 19. | Wife | Wife’s [S] Entitlement | $114,000 |
| TOTAL | $485,736 | ||
| GRAND TOTAL | $1,118,259 |
The real issue in dispute between the parties, as regards the available pool, relates to the three specific “add backs” which Mr Eakins seeks to have included as part of the above balance sheet. I propose to deal with each of these in turn.
Legal Fees
Mr Eakins urges that an amount of $5,005.65 be added back to the pool of property representing legal fees paid (and conceded to be so) by Ms Eakins from the parties joint funds (in fact, two withdrawals totalling $5,379 having been affected by Ms Eakins from the mortgage account and conceded to be so).
Authorities such as NHC & RCH [2004] FamCA 633 suggest that the Court is entitled, within its discretion, to take account of and include such suggested add backs.
What is clear from the evidence as it sits, following the completion of cross examination, is that the husband has expended approximately $20,000 in paid legal fees whilst the wife has expended $5,379 in paid legal fees (and has an amount in the vicinity of $48,000 outstanding in legal fees).
The husband has not, in his affidavit material, made any reference to any expenditure upon legal fees and thus there is no material before the Court as to the source of payment of such fees by the husband other than his concession in cross examination that some of the monies borrowed by him from his parents and his partner Ms L have been applied towards the payment of legal fees.
To that extent I would be entitled to add back the legal fees paid (and conceded to be so) by the husband. If such were included I would also need to take into account the liabilities that have been created in meeting such fees. However, the loans obtained by the husband in total (based upon an acceptance of his evidence with respect to same (both as to the quantity borrowed and the source of application)) total $8,000 and thus one is left with legal fees conceded by Mr Eakins as having been paid by him of $12,000 and as to which the source of payment is not disclosed.
In light of the above I am not satisfied that any adjustment can or should be made with respect to paid legal fees by Ms Eakins and/or either party.
Lest I am wrong in that regard I am satisfied that I would be entitled to make some allowance with respect to legal fees paid by the husband since separation and which exceed and outweigh those paid by Ms Eakins.
Thus I do not propose to accede to the inclusion of the addback urged by Mr Eakins with respect to legal fees.
Expenditure by the wife of pre separation savings
During her cross examination the wife conceded that she held, at separation, funds of $10,287.23 in a [T] Credit Union account in her sole name. Ms Eakins’ evidence was that a sum of approximately $200 per pay (presumably fortnightly) had been paid into this account to meet a variety of expenses and that these deposits had occurred since that account had come into being.
Post separation Ms Eakins conceded that she had made withdrawals ($1,000 at a time) totalling $8,000 and that a modest balance remained in that account at the date of hearing.
Ms Eakins asserts and I accept that the funds withdrawn by her were applied towards meeting living expenses for herself and the two children as well as meeting other expenses as they arose post separation.
It is asserted by Counsel for Mr Eakins that Ms Eakins’ evidence would be rejected and particularly noting that eight transactions of $1,000 each occurred over eight consecutive business days. Ms Eakins again asserts that these funds were withdrawn by her, held in cash, and used to meet living expenses as and when they fell due.
A call was made for Ms Eakins to produce receipts relating to and evidencing expenditure by her and a large zip lock bag was produced containing receipts retained by Ms Eakins and identified by her under oath. The documents were made available for inspection by Counsel for Mr Eakins (if they had not in fact been made available earlier). The documents were not ultimately tendered.
I do not draw any inference from the failure to tender the documents produced by Ms Eakins. However, to the extent that it was put to Ms Eakins that she did not hold any documents which related to expenditure, I clearly cannot accept that submission.
I am not satisfied that the expenditure of funds by Ms Eakins can or should be taken into account. Authorities such as Kowali &Kowali (1981) FLC 91-092 suggest the Court’s discretion to include notional assets in circumstances whereby there has been a premature distribution of property. However, as was made clear within that authority by his Justice Baker, a far greater jurist than myself, such approaches should be the exception rather than the rule and should be approached with some caution and trepidation lest expenditure reasonably incurred might thus artificially create a notional asset for division.
It is also to be noted that the expenditure of the parties in the months immediately following separation (both with respect to banking accounts and the Visa account) reflected, to at least some extent, expense incurred prior to separation.
Having regard to all of the above and noting the paucity of evidence in the case of Mr Eakins as to his financial circumstance and expenditure since separation, his expenditure of funds and the like, I am not satisfied that any adjustment can or should be made with respect to the expenditure of funds by Ms Eakins from her [T] Credit Union account.
Wife’s expenditure post separation from the joint account
As would be apparent from the above discussion of evidence I accept that deposed to by Ms Eakins and that set out in Exhibits ‘H4’ and ‘H5’ regarding Ms Eakins’ withdrawal from accounts and expenditure of funds post separation.
As would also be apparent from the above discussion I am satisfied that the total personal or non-capital expenditure by Ms Eakins in the five month period following separation (being $7,707.55 – see Exhibit ‘H4’) is far from excessive and is entirely consistent with Ms Eakins’ explanation of meeting post separation living expenses.
Having regard to all of the above matters I am thus not satisfied that any inclusion should be made with respect to this final “notional add back”. Thus the pool of property will, for the purpose of this determination, comprise the assets and liabilities (including superannuation assets) set out in the agreed balance sheet Exhibit ‘W2’.
Contributions
A significant issue arises in these proceedings and on the case of Mr Eakins as to initial contribution.
Mr Eakins submits that his ownership of the [P] property prior to the commencement of cohabitation between the parties, in March 1987 and a little over two years following the purchase of the property, should be taken into account as a significant initial contribution. Counsel for Mr Eakins thus asserts (page 7 of the case outline document) that the husband introduced:
“property at Property P (which the husband had purchased in late 1984 moving in in January 1985) valued at approximately $50,000 encumbered by a mortgage of approximately $48,000 (paragraph 7, 8 and 9). This property was sold at the end of 1994 for $117,000 and contributed to the purchase of the parties former matrimonial home at Property R, [R] (paragraph 45)”
It is curious that above submission contained within a Case Outline document relied upon at trial and specifically prepared and filed for the purpose of the hearing 8 August 2013 has adopted and relied upon the husband’s evidence in the two earlier affidavits (and subsequently amended by his evidence in his trial affidavit). I do not take that as an admission, inferentially or otherwise, as to the accuracy of the earlier assertion.
Even if one were to treat the mortgage encumbering the property as $38,000 (rather than $48,000) clearly the equity available to the husband at the time of the purchase of the property was limited. Further the husband had the benefit, following the purchase of the property, of occupation of same.
The parties commenced to cohabit approximately 2 years after the property was purchased (March 1987) and no evidence is lead as to the value of the property at that time, the level of the mortgage encumbering the home or the like. It is submitted, in Mr Eakins’ case, that the mortgage was paid out prior to the sale of the property and at an accelerated rate. However, it is open to me to accept (and I do) that Ms Eakins had also made a significant contribution towards the accelerated reduction of the mortgage either through her direct or indirect contribution to payment or, as asserted by her, her having met other expenses of the parties jointly and which allowed and “freed up” the husband’s income to allow such accelerated payment.
In closing submissions it was submitted that “at least 75% of the funds ultimately realised from the sale of the property” should be found in the husbands favour as additional contribution. I reject that submission.
It is not possible or appropriate for me to engage in arbitrary mathematical calculation as to the portion or value of the proceeds of sale that should be ascribed as the husband’s initial contribution.
As is asserted by Counsel for Mr Eakins and which I accept, consistent with authorities such as Pierce & Pierce (1999) FLC 92-844 and AJO v GRO, I must approach initial contribution by “considering the weight to be attached to the initial contribution…[and] regard must be had to the use made by the parties of that contribution”.
I am also referred to the Full Court’s decision in Williams & Williams [2007] FamCA 313 and the passage:
“We think that there is force in the proposition and that a reference to the value of an item as at the date of commencement of cohabitation without reference to its value to the parties at the time it was realised or its value to the parties at the time of trial, is still intact, may not give adequate recognition to the importance of its contribution to the pool of assets ultimately available for distribution between the parties” (paragraph 26).
I accept each of the above propositions but I am satisfied that they counter against the position which I am urged by Mr Eakins to adopt.
At the time that the parties commenced their relationship (some months after the property was purchased) and at the time they then commenced their cohabitation (some two years after the property was purchased) both parties were engaged in paid employment and each contributed, whether directly or indirectly, to all of expenses of the relationship including the mortgage encumbering the home.
There is no issue that the husband owned the property nor that he had purchased it shortly before the parties met each other and some two years before they commenced full time cohabitation and were ultimately married. However, to assert that the husband should, on the basis of his legal title to the property in his sole name, thus receive some credit or allowance for the total value ultimately derived on sale of that property (or a substantial, fixed percentage thereof) is inconsistent with the authorities relied upon by Mr Eakins.
The initial contribution (the introduction of a heavily encumbered property in which the parties then both lived and contributed to) represents one aspect of the myriad of contributions made by the parties and each of them throughout the relationship. That has included the conceded position of both parties that but for any consideration of initial contribution and until the date of separation the parties both worked hard and contributed equally.
Mr Eakins was somewhat less able to make such concession during his cross examination. When the proposition was put to him that “…both parties had worked hard and devoted all of their efforts and resources to the relationship” Mr Eakins readily conceded that he had but cast some doubt (or aspersion) upon Ms Eakins and her commitment to the relationship and contribution thereto. Indeed it was specifically put to Mr Eakins that “until your separation you both contributed the best you could” and Mr Eakins responded in disingenuous and niggardly fashion “I did. I don’t think she did. What she did I don’t know”.
That response by Mr Eakins does him no credit particularly in light of the ultimate concession by his Counsel in submissions (both within the case outline document and oral submissions) that during the relationship the parties should be assessed as having contributed equally (but for the asserted weight to be attach to initial contribution).
Overall I am not satisfied that any adjustment should be made in favour of Mr Eakins as regards his initial contribution being the introduction of a very limited equity in a home at [P]. That introduction must be viewed in the context of the relationship between these parties having subsisted from 1987 until 2012 (a period of approximately 25 years) and during which time both parties were engaged in paid employment and both parties were engaged in meeting the myriad of responsibilities that arose in their relationship (primarily borne, I am satisfied, by Ms Eakins) as a consequence of the birth their two children.
Post Separation Contribution
Each party asserts that post separation they should be assessed as having made a greater contribution.
Mr Eakins particularly urges that this would be so having regard to the greater payments he has made with respect to the mortgage encumbering the [W] property in which he has resided. However, for reasons I have addressed above, I am not satisfied that any adjustment is warranted.
Ms Eakins asserts that her post separation contribution has been greater than that of Mr Eakins particularly noting:
a)She has, save for a period of approximately 5 months, had the full time care of both children of the relationship (notwithstanding that [X] has obtained the age of 18 years and is thus not a “child” within the meaning of s.75(2));
b)Ms Eakins has thus incurred significant cost in maintaining her household comprising, as it does, two adult or near adult children. Whilst child support has been paid as assessed by the Child Support Agency I am satisfied that this represents a contribution to the overall cost and does not, in any way, reflect an equal contribution to the children’s expenses the majority of which have been borne by Ms Eakins; and
c)
Following the making of consent orders 24 September 2012
Ms Eakins was responsible, until the completion of the sale of each of the two investment properties at [T] and [O], for the mortgages and short falls relating to same and has, since their respective sales, been responsible for servicing the remaining debt arising as a consequence of the short fall of sale proceeds as regards the mortgage payout.
The above contributions were made by Ms Eakins in the context of:
a)Mr Eakins having a greater income and earning capacity than Ms Eakins;
b)
Ms Eakins’ income and earning capacity has been impacted by her ongoing responsibility for the care of the child of the relationship under the age of 18 years and her assumption of responsibility (which responsibility is not conceded by
Mr Eakins) for the assistance of the adult child of the relationship, [X];
c)Ms Eakins having the full time care of the two children even though assuming responsibility for joint liabilities for the parties relating to investment properties; and
d)Ms Eakins being hampered in the address of financial issues through the asserted refusal of Mr Eakins to discuss any issue with her or to seek to arrive at any consensual position.
Having regard to the overall expenses of both children and of
Ms Eakins’ household comprising herself and both children of the marriage I am satisfied that the financial contribution made by way of child support paid by Mr Eakins can appropriately be described, as it is in submissions in Ms Eakins’ case, as “modest”.
Having regard to all of the above matters I am satisfied that contribution between the parties overall and to the date of trial should be assessed in Ms Eakins’ favour and reflecting a 52.5% contribution by her and a 47.5% contribution by Mr Eakins.
Section 75(2) adjustment
I am urged by Ms Eakins to make an adjustment of not less than 5% having regard to s.75(2) adjustments and factors contained within s.75(2) that would favour Ms Eakins.
The determination of s.75(2) adjustments must also occur within the context of the application for adult child maintenance pursuant to s.66L and, accordingly, I will deal with both together.
Mr Eakins, through his Counsel, conceded during submissions that an adjustment of 10% should be made in favour of Ms Eakins having regard to s.75(2) although tempered with the reservation that such adjustment would occur on the basis that:
a)No ongoing order pursuant to s.66L were made; and
b)An order for superannuation splitting was made.
It was fairly submitted by Counsel for Ms Eakins that whilst a 10% adjustment might be readily agreed that such adjustment could not be supported particularly in the event that a superannuation splitting order were not made and, instead, adjustments occurred as regards tangible or non-superannuation assets only. Counsel for Ms Eakins submitted that, in those circumstances, some discount of the conceded s.75(2) adjustment would need to occur. I accept that submission.
Section 66L
Section 66L of the Act provides as follows:
(1) A court must not make a child maintenance order in relation to a child who is 18 or over unless the court is satisfied that the provision of the maintenance is necessary:
(a) to enable the child to complete his or her education; or
(b) because of a mental or physical disability of the child.
The court may make such a child maintenance order, in relation to a child who is 17, to take effect when or after the child turns 18.
(2) A court must not make a child maintenance order in relation to a child that extends beyond the day on which the child will turn 18 unless the court is satisfied that the provision of the maintenance beyond that day is necessary:
(a) to enable the child to complete his or her education; or
(b) because of a mental or physical disability of the child.
(3) A child maintenance order in relation to a child stops being in force when the child turns 18 unless the order is expressed to continue in force after then.
Ms Eakins clearly relies upon [X]’s present health as the basis for her application. It is not suggested that [X] requires ongoing financial assistance to complete a course of education or training (although evidence was lead by both Ms Eakins and [X] as to courses which she is undertaking or proposing to undertake).
I accept, on the basis of the evidence available including a report from [X]’s treating doctor annexed to the material relied upon in Ms Eakins’ case (as to which no objection was taken) that [X] is not presently able to engage in paid employment or any substantial or significant paid employment as a consequence of her mental health issues. Further, I accept that [X] will not be in a position to do so in the foreseeable future.
Mr Eakins had indicated, during his cross examination, that he was not satisfied that any medical evidence had been presented as would satisfy the Court of the above. Again I am conscious of the concession made by Mr Eakins as to the difficulties that [X] first faced in 2007 and which, based on the totality of evidence I accept continue unabated.
Having regard to the above finding I am satisfied that an order for child maintenance would be sustainable by reference to [X]’s present inability to maintain and support herself as a consequence of her health. Further, I am satisfied that there is some capacity, which I have difficulty in quantifying but, as such difficulty arises from the difficulties in accepting the veracity and accuracy of Mr Eakins’ evidence same does not concern me substantially, to contribute towards those costs.
Ms Eakins’ position is that she has, since separation, attempted to meet the costs incurred with respect to [X]’s health care treatment (including medical consultation costs and medications) but is “unable to fund the increasing costs” of same.
Overall I am satisfied that the more appropriate course would be for me to make an adjustment (as Mr Eakins concedes and urges I should) having regard to [X]’s greater costs and the assumption of those responsibilities by Ms Eakins, as part of an adjustment pursuant to s.75(2) rather than an order pursuant to s.66L. I take this course as:
a)Funds would then be available for Ms Eakins to assist [X] with those expenses should she so desire;
b)I am conscious that the order sought is, to some extent, a “blank cheque”. The order as sought requires contribution by Mr Eakins of “50% of all medical costs”. Whilst I do not accept the criticism of Mr Eakins that no quantification is provided with respect to such costs and what would reasonably be required, this would provide significant potential for future dispute, disagreement, and, I am satisfied further proceedings between the parties then seeking to navigate the definition of liability contained within such order; and
c)I am concerned that whilst I cannot quantify the expenses in fact incurred by Mr Eakins (and need not exercise great caution with respect to same as it arises from the deficiency of Mr Eakins’ evidence) that to impose an order of either broad (and to be defined in the future) quantum or a specific sum estimated as adequate by reference to the evidence, would impact upon the capacity of Mr Eakins to meet his own living expenses, accommodation expenses (particularly in light of the orders I propose to make with respect to property adjustment which will see Mr Eakins undertaking some further, slight borrowing against title of the [W] property) or his child support contributions as assessed.
In light of the above I propose to dismiss the application for s.66L relief but to take the factors which would otherwise speak to and, I am satisfied, allow and entitle an exercise of discretion in making an order into account as part of the s.75(2) adjustment. The award of an order pursuant to s.66L is not mandated by finding the existence of a basis for the relief and a capacity to pay but remains a matter of discretion.
When thus returning to s.75(2) I note, again, the concession in submissions in the closing of Mr Eakins’ case that an adjustment of 10% should be made in Ms Eakins’ favour. However, for reasons I have described above (and as conceded by Counsel for Ms Eakins) I propose to temper that conceded adjustment particularly as:
a)I am not satisfied that a superannuation splitting order should be made in preference to the adjustment of tangible, non-superannuation assets between the parties and each retaining their respective superannuation entitlements complete; and
b)The balance of factors to which I will refer by reference to s.75(2) would be adequately compensated by a more modest adjustment.
Age and state of health of the parties
The parties are of the same age and each is now in good health. Ms Eakins has previously experienced significant health crises although these, hopefully, are historical.
Neither party has lead evidence which would support any finding that any age or health factor would impede or impact upon their capacity to continue in their chosen employments.
Income property and financial resources of each of the parties and capacity for appropriate gainful employment
As would be clear from the above each of the parties has no impediment to participation in paid employment within their chosen field.
Mr Eakins has a greater income and earning capacity than Ms Eakins (being an income of $110,000 - $120,000 per annum compared to Ms Eakins’ income of approximately $75,000 per annum).
Each of the parties will, as a consequence of the arrangements they propose and which I propose to order, continue to accommodate themselves on an affordable basis and, thus, each will otherwise retain property and resources (and their respective incomes).
Whether either party has the care and control of a child under 18 years
The youngest of the two children of the relationship is under the age of 18 years and Ms Eakins has her fulltime care.
Whilst the parties had operated a shared care arrangement for a brief period of time post separation it is clear that neither child presently participates in any relationship with Mr Eakins and, thus, Ms Eakins has the fulltime care of the both children (albeit that [X] is an adult).
Commitments of each of the parties to support themselves and children or other persons whom they have a duty to maintain
Mr Eakins’ household would appear (subject to absence of evidence with respect to the nature of his relationship with Ms L) to have commitments for his own support. Mr Eakins also has a legal obligation to support the younger of the two children and makes a contribution towards that support through payment of child support as assessed.
Ms Eakins has obligations to support herself and I am satisfied supports both of the children of the relationship notwithstanding that [X] is an adult. I am satisfied that Ms Eakins considers herself duty bound to maintain [X]. That is in no way a criticism of her nor intended to be pejorative of the efforts that she has taken in supporting [X] which are to be entirely commended, supported and encouraged.
Responsibilities to support any other person
I am satisfied this factor is addressed above.
The eligibility of either party to a pension or allowance
Neither party is entitled to a pension or allowance.
In the future Mr Eakins will be entitled to receive a superannuation pension or lump sum payment from his far more substantial superannuation entitlements.
Whilst I am conscious that the orders I propose to make (which will leave the parties respective superannuation entitlements intact and laying where they lay) will deprive Ms Eakins of future retirement income I am satisfied, for reasons I will elaborate upon, that this is the more equitable approach. Thus Mr Eakins will have greater retirement income available to him which is a factor I am satisfied I can and should take into account.
The maintenance of a standard of living which is reasonable
I am satisfied that for Ms Eakins to maintain a reasonable standard of living between now and retirement that she needs to maximise available tangible (non-superannuation) assets. Her primary need is for accommodation for herself and the children and she desires to provide this accommodation through retaining the home in which she presently resides.
If orders were made as proposed by Mr Eakins (at least by his amended response filed some working days prior to the trial and, in effect, significantly amending the relief sought by him) I am satisfied that
Ms Eakins would not be able to maintain her home and would be required to sell it.
I have no evidence before me as to the buying capacity of either of the parties. Ms Eakins’ income is less Mr Eakins’. Ms Eakins’ commitments and responsibilities in supporting herself and the children of the relationship are far greater than those faced by Mr Eakins.
If Ms Eakins were required to borrow funds in addition to those which she already owes and which encumber the [R] property (which would be the irresistible effect of the relief proposed by Mr Eakins) then I am not satisfied she would be in a position to retain that property or to do so without the repayments required to service the liability consuming such a portion of her income that she would either fall into debt, have to significantly reduce her standard of living (and that of the two children of the relationship) and ultimately be disadvantaged.
The extent to which payment of maintenance of a party is under consideration
This is not relevant.
The effect of orders on creditors
This is not relevant
The extent to which a party has contributed to the income earning capacity, property or financial resources of the other
I am satisfied that Ms Eakins has contributed to the financial resources of Mr Eakins particularly his superannuation entitlements.
Mr Eakins asserts that he has made contributions to his superannuation since separation which should be taken into account. However, there is no evidence of the contributions made by Mr Eakins or the impact that such contributions, if made, have had upon the value of his superannuation fund.
It would appear clear (accepting that alleged by Mr Eakins in his respective financial statements) that his primary fund (the larger of the three in which he has an interest) has substantially increased in value since separation. This cannot, however, be attributed purely to contributions made (whether by Mr Eakins or by his employer via superannuation levy contributions) in the 18 months since separation. The increase is, no doubt, largely as a function of the accrual of interest and other benefits upon funds invested over the length of the marriage of the parties.
Ms Eakins has supported Mr Eakins in his occupation and re-training as a [omitted] and through her contribution has allowed, enabled and permitted Mr Eakins to maintain continuity of employment, undertake overtime, earn additional income and contribute substantial superannuation interests. This factor favours Ms Eakins.
The duration of the marriage and the extent to which it has affected earning capacity
The marriage has subsisted for 25 years. Neither party’s earning capacity has been adversely affected.
I am conscious that the duration of the relationship is something which I am entitled to take into account both as regards contribution (which I have for the purpose of assessing the weight to be afforded to initial contribution, for instance) as well as the adjustment that might now be made.
Ms Eakins’ employment and earning capacity has been somewhat restricted and continues to be so as a consequence of her care of the two children of the relationship.
Whilst this factor favours Ms Eakins it is not as significant as others.
The need to protect a party who wishes to continue their role as homemaker and parent
The orders proposed by Ms Eakins, particularly on the basis of superannuation resting with the party who owns the fund, will assist Ms Eakins in continuing her present employment and her ability to tailor her employment arrangements and income earning around her responsibilities as a parent which responsibilities she discharges on a full time basis.
If Ms Eakins were required to make a cash payment in excess of $100,000 to Mr Eakins (in return for receiving a superannuation splitting order) she would, in all probability have greater financial pressures, feel the need to work greater hours to earn such greater income as would be necessary to meet household expenses and the increased mortgage and, thus it would impact upon her present role as parent.
If either party is cohabiting
There is no evidence to suggest that either party is although Mr Eakins’ case is somewhat absent evidence regarding the existence of a relationship between himself and Ms L. I do not propose to infer that Mr Eakins has any financial benefit from his relationship, such as it may be, with Ms L nor that Mr Eakins cohabits with Ms L.
The terms of the order proposed and its impact upon bankruptcy
This is not relevant.
Terms of orders proposed and the impact upon other persons and bankruptcy
This is not relevant.
Child support assessed and paid
Mr Eakins pays child support with respect to the one child of the marriage under the age of 18 years and will continue to do so for in excess of 12 months. Following that I am satisfied, having regard to the totality of the evidence and particularly the annexures to Ms Eakins’ material (evidencing requests for greater financial assistance, contribution to expenses with would not ordinarily be considered as addressed through payment of child support and the like) that Mr Eakins will, at the first opportunity and upon cessation of an assessable child support liability, cease to and refuse to make any further contribution towards the children’s expenses.
Other facts or circumstances
I am satisfied that the present need for each party to accommodate themselves and, in the case of Ms Eakins, the two children of the relationship, obviates against a superannuation splitting order.
I am conscious this will potentially prejudice Ms Eakins in retirement as she will have far less retirement income available to her that Mr Eakins. Ms Eakins will be free to sell and readjust and invest her assets as she wishes including for retirement planning purposes.
I am conscious that whilst this will also mean that Mr Eakins receives a significant portion of his entitlement from property adjustment as non-vested superannuation funds that this will be offset, in the long term, by the benefit he will receive.
I am also conscious that this is balanced against the relatively rapid growth that Mr Eakins’ superannuation asset has experienced and will , no doubt, continue to experience at least in the short term. The fund has grown by something in the region of $100,000 since separation (based on that asserted by Mr Eakins in his financial statements) and such growth will benefit Mr Eakins now and into the future. I am satisfied that such growth is relevant to the s.75(2) adjustment to be made and supports the 7.5% adjustment I propose to make.
I am also conscious that each party will be a position to support themselves, meet their expenses (including child support liability) accommodate themselves and service debt encumbering their respective accommodation perfectly adequately from their present incomes and thus that justice and equity is served by orders being made which askew superannuation splitting but which, instead, make adjustment as between tangible, non-superannuation assets and leave each party with their non-vested superannuation entitlements intact.
At the conclusion of the above considerations I am satisfied that an adjustment in favour of Ms Eakins of 7.5% (being a 2.5% discount from that conceded by Mr Eakins’ Counsel) should be made.
Justice and equity
Whilst I am satisfied that the High Court’s decision in Stanford obviates against a separate and discrete fourth step of standing back from the decision arrived at by the above considerations and satisfying myself that the orders I propose are just and equitable I will undertake that exercise.
In undertaking such an exercise I am, again, satisfied that the percentage division of the pool as well as the manner in which I propose to formulate that division (through a refusal to make a superannuation splitting order) represents justice and equity as between the parties having regard to the length of their relationship, their respective contributions and adjustments which are warranted (and conceded by Mr Eakins through his Counsel).
The Full Court has been clear that there is no legislative presumption or imperative in favour of superannuation splitting. I propose, for the reasons above, to exercise my discretion as to the form of orders, by declaring each party the owner of and thus retaining their respective superannuation interests. I am satisfied that will best achieve a just and equitable outcome.
Orders made
On the basis of the above I am satisfied that there should be an overall division of superannuation and non-superannuation assets on a 60/40% division in the wife’s favour.
The orders that are proposed by Ms Eakins represent, in effect, a 60/40% division in her favour and, accordingly, I propose to make orders in accordance with her application.
Costs
Each of the parties has, through their respective application and response, sought a broad and general order for costs.
No specific submission has been sought from the parties with respect to costs and, accordingly, whilst noting that each has purported to seek an order for costs, I have not proceeded to determine that issue. I propose to make directions for the parties to file written submissions with respect to costs should they wish to pursue such an order and judgment will be delivered, based upon such submissions as are received in accordance with the directions made by me, upon the closing of such submissions.
Accordingly I make orders as follows.
I certify that the preceding one hundred and eighty (180) paragraphs are a true copy of the reasons for judgment of Judge Harman
Associate:
Date: 21 August 2013
Key Legal Topics
Areas of Law
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Civil Procedure
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Negligence & Tort
Legal Concepts
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Appeal
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Causation
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Damages
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Duty of Care
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Negligence
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