Eben & Agata
[2024] FedCFamC1F 60
•14 February 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Eben & Agata [2024] FedCFamC1F 60
File number(s): BRC 10962 of 2021 Judgment of: JARRETT J Date of judgment: 14 February 2024 Catchwords: FAMILY LAW – PARENTING – Effect of applicant’s medical episodes on ability to care for the child – Nature of child’s wishes about spending time with the applicant.
FAMILY LAW – PROPERTY – Where respondent won the lottery – Where parties agreed lottery winnings should be in a separate pool retained solely by the respondent – Quantum of adjustment to applicant in circumstances of disability and respondent owning significantly more property.Legislation: Family Law Act 1975 (Cth) ss 75, 79, 117 Cases cited: NHC & RCH [2004] FamCA 633
Farmer & Bramley (2000) FLC ¶93–060
Stanford & Stanford (2012) 47 Fam LR 481
Townsend & Townsend (1994) 18 Fam LR 505
Zyk & Zyk [1995] FamCA 135
Division: Division 1 First Instance Number of paragraphs: 64 Date of hearing: 14 December 2023 Place: Brisbane Counsel for the Applicant: Mr George Solicitor for the Applicant: Australian Law Group Counsel for the Respondent: Mr Pollock Solicitor for the Respondent: Principle Legal ORDERS
BRC 10962 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR EBEN
Applicant
AND: MS AGATA
Respondent
ORDER MADE BY:
JARRETT J
DATE OF ORDER:
14 FEBRUARY 2024
PURSUANT TO s 65D OF THE FAMILY LAW ACT 1975 (CTH) THE COURT ORDERS THAT:
1.The applicant and the respondent have equal shared parental responsibility for decisions concerning the major long-term issues for the child X born 2013.
2.X live with the respondent and spend time with the applicant as agreed, and failing agreement as follows:
(a)every Tuesday from 3:30pm until 6:30pm;
(b)from the date of these orders for a period of two months, each alternate weekend from after school or 3:00pm Friday until 7:00pm Sunday;
(c)thereafter, for a further period of two months, each alternate weekend from after school or 3:00pm Friday until before school Monday, or 3:00pm if Monday is not a school day; and
(d)thereafter, each alternate weekend from after school or 3:00pm Thursday until before school Monday, or 3:00pm if Monday is not a school day.
3.X’s time with the applicant in accordance with these orders be supervised as arranged by the applicant, by the applicant’s mother or carer as appropriate.
4.For school holidays, other than the Christmas school holidays, X live with the respondent and spend time with the applicant from the conclusion of the school term until 11:00am on the day calculated to be half the school holiday period.
5.For the Christmas school holidays, X live with the respondent and spend time with the applicant for the first, third and fifth weeks of the holidays with changeover occurring at 4:00pm on each Saturday, and from 9:00am on 26 December until 9:00am on 28 December each year.
6.If X is not otherwise spending time with the applicant on Father’s Day, she spend time with the applicant from 3:30pm the day before Father’s Day until 5:00pm on Father’s Day.
7.If X is not otherwise spending time with the respondent on Mother’s Day, she spend time with the respondent from 3:30pm the day before Mother’s Day until 5:00pm on Mother’s Day.
8.On X’s birthday, she spend time with the party she is not otherwise residing with in accordance with these orders from 9:30am until 12:00pm if not a school day, or from the conclusion of school until 5:30pm if a school day.
9.If the applicant’s birthday falls on a non-school day, X spend time with the applicant from the conclusion of school or 3:00pm on the day before the applicant’s birthday until 5:00pm on the applicant’s birthday, and if the applicant’s birthday falls on a school day, from the conclusion of school or 3:00pm on the day before the applicant’s birthday until before school on the day after the applicant’s birthday.
10.If the respondent’s birthday falls on a non-school day, X spend time with the respondent from the conclusion of school or 3:00pm on the day before the respondent’s birthday until 5:00pm on the respondent’s birthday, and if the respondent’s birthday falls on a school day, from the conclusion of school or 3:00pm on the day before the respondent’s birthday until before school on the day after the respondent’s birthday.
11.School holidays shall be deemed to have commenced on the day the school term finishes and conclude at 8:30am on the day the school term recommences, with half the school holiday period to be calculated with reference to the number of nights in the school holiday period, and if there are an odd number of nights then the applicant shall retain the additional night.
12.X’s time with each party under Order 2 be suspended during the school holiday period, and recommence on the commencement of the school term as if the sequence had been uninterrupted.
13.The applicant ensure X has her own phone with the respondent’s contact details in it while in his care.
14.Each six months from the date of these orders, the applicant attend upon his medical practitioners including but not limited to his treating specialist to obtain a medical report or discharge summary and provide a copy of that report or discharge summary to the respondent within 14 days of receiving same.
15.X attend high school at B School and if that is not a viable option then another Catholic school within 10km of Suburb D.
16.Changeover shall take place at X’s school if a school day, and E Shopping Centre if not a school day.
17.X is at liberty to contact either party when in the other party’s care at her reasonable request, and each parent shall do all reasonable acts and things necessary to facilitate such communication, including not blocking the other party’s telephone number.
18.Each party shall:
(a)keep the other party informed at all times of their contact information including telephone numbers, address and email address and shall notify the other party at least seven days prior to relocation;
(b)keep the other party informed of the names and addresses of any treating medical or other allied health practitioners who treated X and authorise those practitioners to provide the other party with information that they are lawfully able to provide about X; and
(c)immediately inform the other party of any medical condition, significant health issue or significant illness suffered by X and authorise any treating medical practitioner to release X’s medical information to the other party.
19.The parties authorise the school or day care centres attended by X to give each party information about her educational progress and other related activities and supply them with copies of reports, photographs, certificates and awards obtained by her (at the requesting party’s cost).
20.By this Order, each party shall be permitted to attend all functions held by an educational facility, child minding facility or any other event X attends including, but not limited to, parent teacher interviews, school plays or concerts, and any other sporting or extra-curricular activities, and each party shall provide the other with not less than seven days’ notice in writing of any such events being scheduled in order to ensure both parties have the opportunity to attend such events.
21.During the time X is with either party, that party must:
(a)ensure that she has her own room to sleep in;
(b)respect the privacy of the other party and not question X about the personal life of the other party;
(c)speak of the other party, their respective partners, family or friends respectfully; and
(d)not denigrate the other party, their respective partners, family or friends, directly or in the presence or hearing of X and shall use their best endeavours to ensure that no-one else does so and shall remove X from any environment when denigration is occurring.
22.The parties are hereby restrained from:
(a)abusing, insulting, belittling, rebuking or otherwise denigrating the other party;
(b)discussing with X or in her presence or hearing any family law or domestic violence proceedings or the contents of any other content relating to legal proceedings involving the party or child;
(c)allowing X to refer to either party’s current or future partners as “dad” or “mum” or any like name; and
(d)using illicit drugs or allowing anyone who has consumed illicit drugs to be present around X.
23.The parties review these orders on a date two years from their making to assess:
(a)the applicant’s health;
(b)whether the time X spends with the applicant ought be varied; and
(c)any other relevant consideration.
24.In the event a dispute arises about the terms of operation of these orders, or a disagreement relating to care arrangements for X, the following process is to be used for resolving any such dispute:
(a)the Family Relationship Centre shall appoint a Family Dispute Resolution Practitioner in a location where X is resident;
(b)the parties shall consult with the Family Dispute Resolution Practitioner to assist with resolving any dispute or reaching agreement about changes to be made;
(c)the parties shall share equally in the costs of the Family Dispute Resolution Practitioner;
(d)in the event the parties cannot access the Family Dispute Resolution Practitioner in a timely manner, the applicant shall nominate three practitioners and advise in writing details of their fees, experience and availability;
(e)the respondent shall choose one of the listed practitioners within seven days of receipt of the list; and
(f)if the respondent fails to choose, then the applicant may choose.
PURSUANT TO S 79(2) OF THE FAMILY LAW ACT 1975 (CTH), THE COURT FURTHER ORDERS THAT:
25.Within seven days of these orders, the applicant and respondent shall authorise the Australian Law Group (and providing a copy of these orders shall constitute sufficient authorisation) to distribute the sale proceeds of F Street, Suburb G currently held on trust in the following manner:
(a)
$139,930.00$130,930.00 to the respondent; and(b)the balance to the applicant.
26.Each party otherwise retain all assets, liabilities, superannuation entitlements and financial resources in their own name.
Notation: Order 25 has been amended pursuant to Rule 10.13(1)(g) of the Federal Circuit and Family Court of Australia (Family Law) Rules2021 to show “$130,930.00” in lieu of “$139,930.00”.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JARRETT J:
This is an application for both parenting and property orders. The parenting aspect of the proceedings concerns X, presently aged 10 years. The applicant, Mr Eben, is X’s father. Of relevance to these proceedings is the fact that the applicant suffers from a medical condition with frequent medical episodes. The respondent, Ms Agata, is X’s mother. She was born in Country C but has resided in Australia since at least 2007 and issue was not raised about her right to continue to reside in Australia.
These proceedings were commenced on 19 August, 2021. It was not until 6 December, 2021 (some 3.5 months later) that the matter was first heard before a registrar. Six months later, a senior judicial registrar heard an interim defended hearing. It was some six months after that before the matter was next heard before a registrar, who listed the matter another three months later for a compliance and readiness hearing. On 6 March, 2023 the compliance and readiness hearing proceeded before a judge of the Federal Circuit and Family Court of Australia (Division 2), who transferred the matter to this court. 6 March, 2023 represented the first time the proceedings had been listed before a judge, more than 18 months since they were commenced.
The proceedings were case managed more effectively in this court, being the subject of direction hearings on 12 May, 9 August, 22 August and 16 October 2023 before being listed before me on 30 October, 2023. On 30 October, 2023 I listed the matter for trial on 14 and 15 December, 2023 (though the trial was completed after one day).
The purpose of setting out the procedural history above is to highlight the case management inefficiencies that have plagued this matter and many like it. It took the matter more than 18 months to be heard before a judge, who immediately transferred it to this court. As will be apparent from the reasons below, this matter is not particularly complex and could have been resolved long ago had it just been allocated a trial date. In the meantime, X was deprived of spending overnight time with her father, which by the date of the trial the parties agreed was in her best interests.
BACKGROUND
Before setting out the history of the relationship, it is of use to comment on the credibility of the parties. I had the benefit of observing both the applicant and respondent under cross‑examination.
The applicant was an impressive witness. He had some problems with recollection, which were to be expected given the evidence that he suffered from a medical condition. However, he admitted freely when he could not remember something, rather than trying to reconstruct his recollection. I was left with the strong impression that the applicant was a truthful witness.
The respondent was far less impressive. She had a propensity to exaggerate claims about the relationship that made her evidence difficult to believe. Some of her statements also beggared belief. For instance, when questioned about X’s statements to the family report writer that her grandmother was evil, the respondent answered that X had simply worked that out for herself and that she had not influenced her. She was either unwilling or unable to accept that her words and conduct may have influenced X’s views.
I have generally preferred the evidence of the applicant over the respondent where they differ.
The parties commenced their relationship in 2007 and were married later that year. The parties lived in Region L. At the time, the applicant was employed as a public servant on a casual basis, whilst the respondent was a hospitality worker, which required her to live at her place of employment.
After the parties’ marriage and the cessation of the respondent’s employment, the parties commenced cohabitation at the applicant’s housing unit in City K. The applicant paid the rent and living costs while the respondent was unable to work until her application for a spousal visa was determined. The respondent did most of the housework and cooking.
Shortly after the parties married, the applicant left his public service job and obtained employment as a hospitality worker earning $36,000 per annum. The respondent also obtained employment with the same employer on a permanent part-time basis earning $25,000 per annum. The parties subsequently both obtained second jobs to save money, the applicant at a retailer and the respondent as a service worker.
In 2009, the parties purchased vacant land in Region L for $430,000 through a land and home package. A large portion of the deposit came from a term deposit brought into the relationship by the applicant and the balance came from jointly accrued savings. The applicant says, and I find, that the term deposit he brought into the relationship represented $30,000 of the $45,000 deposit. The parties encountered some difficulty with the construction of the home, but it was finished in 2012 and the parties moved in along with the respondent’s brother.
The respondent took leave in 2013 and X was born in 2013. Following her birth, the applicant was employed in hospitality full time earning $47,000 per annum. In 2014 the respondent returned to work as a service worker on a part-time basis. The respondent cared for X during the day and worked night shifts, whereas the applicant cared for X in the afternoons and worked during the day.
There was an incident in 2019 that resulted in the applicant filing an application for a domestic violence order against the respondent’s brother. The respondent made an application against the applicant. The relevant incident has no bearing on these proceedings given the orders sought by each party, so I do not need to make any findings about it. The applications were both withdrawn the following month.
As a result of the incident, the parties separated under one roof but reconciled in mid-2019.
In mid-2019 the respondent suffered from a medical episode at his workplace. The following month, he was deemed unfit for work and medically resigned from employment in early 2020. In mid-2020 he was declared indefinitely unfit for work. He commenced receiving a disability support pension. He consequently became more involved in X’s care.
The parties relocated to Brisbane in late 2019. In early 2020 the respondent commenced employment as a part-time service worker earning $550 per fortnight.
The parties separated on 10 April, 2021 after 14 years. They were divorced in 2022.
In mid-2021 a temporary protection order was granted in favour of the respondent against the applicant. The applicant filed a cross-application in mid-2021. The parties consented, without admissions, to protection orders against each other in late 2021.
In 2021 the respondent won a significant sum of money in the lottery. She directed the payment authority to pay the money half to her and half to her brother.
In late 2021, the City K property was sold for around $850,000 and the proceeds have since been held on trust by the applicant’s solicitors.
PARENTING
The parties both now agree that an order for equal shared parental responsibility is in X’s best interests. They also both now agree that it is in X’s best interests to have a meaningful relationship with both parents. X expressed to the family report writer that she loves her father and enjoys spending time with him. It is tolerably clear that both parties have worked hard to provide for and parent X and she has much to gain from a relationship with each of them.
The respondent’s case, by her case outline filed 4 December, 2023 was that it was not in X’s best interests to spend overnight time with the applicant because of the risk of the applicant having medical episodes. One week later on 11 December, 2023 (three days prior to the commencement of the trial) she filed an amended response seeking that X spend each second Saturday night with the applicant. There was no explanation in the evidence for this sudden change of heart.
Following the conclusion of the trial on 14 December, 2023, I made orders by consent that X spend time with the applicant each Tuesday from 3:30pm until 6:30pm and each second weekend from 2:00pm Saturday until 7:00pm Sunday, until delivery of this reserved judgment. Those orders were consistent with the first stage of the final parenting orders sought by the respondent. He sought orders which over time gradually extends X’s overnight time with him.
The respondent’s case was both that the medical episodes greatly distressed X and that they placed her at risk because of the applicant’s incapacitation.
The applicant’s evidence in cross-examination was that X was not at all scared of him having an episode. The respondent’s evidence was that X was terrified of the applicant having an episode. The truth lies between these two extremes. It is likely that X puts on a brave face for her father and pretends not to be frightened and picks up on her mother’s anxiety and distrust of the applicant and plays up her fear as a result. X expressed to the family report writer that it is “pretty scary” when the applicant has a medical episode. It is entirely unsurprising that X is scared of her father having a medical episode, something which would frighten any child.
However, X also confirmed to the family report writer that she has plans in place for when her father has a medical episode. She has a phone to call her grandmother, a carer or her mother if she needs help. This was confirmed in an incident only a week before the trial, when the applicant and X were eating at home and the applicant had a medical episode. X rang the respondent, who agreed for the support worker to bring her home early, which he did.
The respondent’s concerns about X spending overnight time with the applicant due to his medical episodes were difficult to pin down. While she apparently held this concern from the commencement of proceedings until days prior to the trial, her own evidence was that during the relationship she had left X alone with the applicant at night. It was also unclear why, if the risk was so great, X should spend any time with the applicant on the respondent’s case. Although the probability is that X will be exposed to more episodes the more time she spends with the applicant given their frequency, she will be exposed to episodes even if only spending day time with the applicant. Finally, the respondent has now clearly conceded that it is in X’s best interests to spend overnight time with the applicant, in which case it is unclear why that overnight time should be restricted to one night per fortnight.
I do not consider that there is a need to protect X from risk of harm resulting from the applicant’s medical episodes.
While X expressed some concerns about spending overnight time with the applicant, the family report writer was concerned that she was aligned with the respondent who had not insulated her from her own concerns about the applicant’s medical episodes and separately, the applicant’s mother, with whom she had a poor relationship.
The evidence is unequivocal that X clearly enjoys spending time with the applicant.
Similarly, I find that X’s views of her paternal grandmother have been influenced by the respondent. These negative views are of little consequence and should not affect the amount of time X spends with the applicant. As she spends more time with the applicant and her paternal grandmother, she will likely become less aligned with the respondent on this issue.
There were no other issues of importance identified by the parties arising under s 60CC(3). To the extent that it weas obliquely suggested that the applicant might lack the capacity to properly meet X’s needs because of his medical condition, I do not accept that proposition. It is clear that he is able to manage her needs.
I find that it is in X’s best interests to spend time with the applicant in line with his proposal, each week from 3:30pm until 6:30pm Tuesday, and each alternate week from after school Thursday until before school Monday. However, given X has only recently recommenced overnight time with the applicant, the order will more gradually develop to the spend time arrangements sought by the applicant.
The applicant sought an order restraining the respondent from travelling internationally with X. There was no evidence to suggest the respondent was a flight risk. The respondent is undertaking English studies in Australia, her brother lives here and she has an unencumbered property here. An order permitting the respondent to travel to Country C with X will also promote her Country C culture.
PROPERTY
Both parties sought that I consider the property in two pools, the second pool comprising of any money relating to the respondent’s lottery winnings and the first pool comprising everything else. Both parties agreed the respondent should receive 100% of the second pool. The applicant sought he receive 100% of the first pool, whereas the respondent sought that the first pool be divided equally.
One of the difficulties in using a multiple pool approach as compared to a global approach was highlighted in the following exchange with counsel for the respondent during submissions:
HIS HONOUR: No, no. You tell me there are two pools.
COUNSEL FOR THE RESPONDENT: Yes.
HIS HONOUR: One pool consists of all of the assets, other than her home at [Suburb H].
COUNSEL FOR THE RESPONDENT: Yes, at [Suburb D], yes.
HIS HONOUR: Pool 2 is the [Suburb H] home.
COUNSEL FOR THE RESPONDENT: Yes.
HIS HONOUR: So, when I do the 56/44, that’s on pool 1.
COUNSEL FOR THE RESPONDENT: Yes.
HIS HONOUR: Right, and she gets 100 per cent of pool 2.
COUNSEL FOR THE RESPONDENT: Correct.
HIS HONOUR: Right. So, the 75(2) adjustment you’re talking about, that’s in respect of the contribution-based assessment for pool 1.
COUNSEL FOR THE RESPONDENT: I see, yes.
HIS HONOUR: So, it effectively just leaves the home at [Suburb H] out of the equation.
COUNSEL FOR THE RESPONDENT: In terms of 75(2) factors, your Honour, I take - - -
HIS HONOUR: No, no. In terms full stop.
COUNSEL FOR THE RESPONDENT: It does, yes.
HIS HONOUR: …in terms of a division between the parties. So, if I’m to do the exercise correctly, I have to take into account when I’m doing the future factors assessment - - -
COUNSEL FOR THE RESPONDENT: Yes.
HIS HONOUR: - - - in pool 1, her financial resources. And her financial resources must include, mustn’t it, her home in respect of which there is to be no adjustment on your client’s case.
COUNSEL FOR THE RESPONDENT: I’m with your Honour now. Yes, you do.
Of course, if the respondent is to receive the entirety of the second pool, it would be taken into account as her property pursuant to s 75(2)(b) with respect to an adjustment to the first pool.
In Zyk & Zyk [1995] FamCA 135 (also a lottery case, though one where the winnings were minor compared to the overall pool and where the Court ultimately found that the lottery winnings were a joint contribution) the Full Court set out the following relating to a global or asset by asset approach:
Either approach is permissible, depending on the circumstances, but generally the global approach is to be preferred: see generally the discussion in In the Marriage of Norbis (1986) 10 Fam LR 819 ; [1986] FLC 91-712 and In the Marriage of Lenehan (1987) 11 Fam LR 615 ; [1987] FLC 91-814 .
The global approach enables the court to assess the contributions aspect of the s 79 exercise in an overall way by considering the parties’ contributions to their property as a whole although factoring into that exercise the circumstance, if it be so, that they may have made varying contributions to the total property at trial or which formed part of the history of their property during the marriage. It is the generally preferred and the generally adopted approach. It enables a broad approach to be taken to the varying contributions of the parties over the years of their marriage and in particular it usually has the advantage of more easily dealing with and giving proper recognition to paras (b) and (c) contributions. However, where the contributions to the components of the total property are disparate, caution needs to be exercised in this approach and the overall conclusion tested against the requirement that the orders be ``just and equitable’’. Lenehan is an example of a case where difficulties arose for that reason.
The asset by asset approach enables the court to assess separately the parties’ contributions to particular assets or groups of assets. It is the less preferred approach largely because it can at times be an artificial exercise and also because it can create difficulties in the proper evaluation of paras (b) and (c) contributions. But there are a number of circumstances where it may be appropriate to do so, for example an inheritance received post separation, or where the financial relationship of the parties during the marriage was such that they treated some property as exclusively the property of one party to which the other party made no, at least no para (a), contributions to it. It may be convenient in cases like that to treat that property separately rather than assess the overall contributions of the parties to the totality of their property.
However, the trial judge has a discretion as to which course to adopt and does so having regard to what appears more suitable to the circumstances of the particular case.
In deference to the agreement of the parties that a “two pool” approach should be adopted and that the post-separation lottery winnings were not contributed to by the applicant, I have applied a two-pool approach in this case.
Curiously, the respondent also sought that the first pool should include a liability of $190,000 to her brother. This liability arose from a series of loans said to have been given to the respondent by her brother after she split her lottery winnings with him. Even if I was minded to include this liability in either pool, it would be more appropriate to place it in the second pool in circumstances where it was incurred post-separation and clearly a part of the series of related transactions involving the respondent’s lottery winnings. Moreover, there are two reasons why I am not minded to include this liability in the second pool, bearing in mind that the agreement for the respondent to receive the second pool in its entirety means findings in relation to the value of that pool are relevant only as to s 75(2)(b).
First, I find that this is a liability that is unlikely to be called in. The respondent’s evidence was that she told her brother she would pay him back when she received a property settlement from the applicant. Her brother’s evidence about the money he was loaning used identical language. The loan agreements annexed to her brother’s affidavit are expressed “to be paid back when you have your final family law property settlement”. They have not been drafted by a solicitor. There was no contemplation of what might happen if the respondent was not furnished by the final property settlement with $190,000 to repay her brother. Under cross-examination, the following exchange occurred between counsel for the applicant and the respondent’s brother:
You don’t really expect to get that money back, do you?---No. I will be expecting that one, Mr George, because I need that money.
Sir, this is your sister who has given you by gift [half of the lottery winnings]. You’ve given back to her nearly $200,000 of that. You don’t really expect to get paid that back, do you?---No. I expect that, Mr George.
And what if she doesn’t pay you?---She will pay me that one, Mr George.
How will she pay you?---She can pay that one for me, Mr George.
How, sir? How do you expect her to be able to repay you $200,000 if she hasn’t got a property settlement that will pay it?---Because I do expect that she can have the property settlement.
What if she doesn’t get the property settlement? She’s not going to be earning that sort of money to pay you back, is she?---For the meantime, Mr George, she can pay me that one, but I know that my sister can pay me that one.
What if she says to you, “I can’t pay you back”? What would you do?---I will tell her that I need that money.
These loans also took place in the context of the respondent gifting half her lottery winnings to her brother. It defies belief that her brother would loan some of that money back to her and expect repayment as soon as possible. I consider that these loan agreements have been drawn so that the respondent might bring the liability to bear on the balance sheet and receive a greater settlement as a result. I do not consider that the respondent is likely to repay these loans to her brother or that he expects repayment. What I expect will happen is that the respondent and her brother will support each other financially as and when the occasion arises.
Second, and far more simply, the respondent and her brother both gave evidence that the money was loaned to cover her legal fees and some shortfall in her and X’s expenses. There was no evidence about how much was spent on legal fees and how much on living expenses. Generally, parties to proceedings under the Family Law Act 1975 (Cth) are to bear their own costs: s 117(1). In NHC & RCH [2004] FamCA 633 the Full Court of the Family Court of Australia (as it then was) said:
58If funds used to pay legal fees have been generated by a party post-separation from his or her own endeavours or received in his or her own right (for example, by way of gift or inheritance), they would generally not be added back as a notional asset; nor would any borrowing undertaken by a party post‑separation to pay legal fees be taken into account as a liability in the calculation of the net property of the parties. Funds generated from assets or businesses to which the other party had made a significant contribution or has an actual legal entitlement may need to be looked at differently from other post-separation income or acquisitions.
I was not, in submissions, given any reason why the general guideline set out in NHC & RCH should not be observed. Given that there is no evidence enabling me to discern what portion of the $190,000 was spent on legal fees vis-à-vis general living expenses, none of the $190,000 should be brought to bear on the balance sheet.
Counsel for the applicant submitted that the half of the lottery winnings gifted by the respondent to her brother should be added back into the second pool as a premature distribution of the parties’ assets in line with Townsend & Townsend (1994) 18 Fam LR 505. But, these were funds acquired by the respondent post-separation and it is agreed that the applicant had made no contribution to them. Whilst that does not mean that the court is unable to make a property adjustment order in respect of them if to do so would be just and equitable in the circumstances (see Farmer & Bramley (2000) FLC ¶93–060 for example), the parties here conducted the case on the basis that the respondent was to retain all of her lottery winnings. The only significance of the value of the fund constituted by the lottery winnings lay in the effect it would have upon the appropriate adjustment, if any, to the parties’ contribution-based entitlements in their other property. That is to say, it is relevant only as a matter to be taken into account under s 75(2)(b) when considering the parties’ entitlements to the property in the first pool. Given that the parties agree the respondent should retain the entirety of the second pool, the best approach I think is to recognise that the respondent has her home at Suburb D funded by her lottery winnings and that her financial circumstances permitted her to gift a significant sum of money to her brother. It is not really a question of “adding back” anything to the parties’ assets. This was the applicant’s alternative submission. I accept this submission.
The evidence makes clear that the respondent’s brother was willing to give her money to cover shortfalls in living expenses. Given she gifted him the money, that is unsurprising. The ability to call upon her brother in those circumstances should be taken into account as a financial resource, albeit it is difficult to quantify the support the respondent will receive from her brother.
Counsel for the respondent contended that the applicant’s entitlements under the National Disability Insurance Scheme should be treated as a financial resource. This argument fails because the applicant does not receive money under the NDIS. Because he is plan-managed, he receives services and while that constitutes a benefit, there is no economic benefit in circumstances where the applicant would otherwise not access the services due to impecuniosity. In the alternative, counsel for the respondent submitted that the NDIS entitlement should be taken into account under s 75(2)(f), a submission I accept.
Both parties agreed that the superannuation entitlements of the parties should be brought to bear on the balance sheet. Neither party suggested that I should consider their superannuation interests separately to their non-superannuation property.
Other than the issues I have set out above, the property of the parties and its values were agreed. I therefore find the assets, liabilities and financial resources of the parties as set out in the following table:
First pool Asset Held by Value Funds held on trust Joint $559,763.00 Motor Vehicle 1 Respondent $18,600.00 Respondent’s bank accounts Respondent $1,812.00 Applicant’s bank accounts Applicant $8,244.00 Applicant’s superannuation Applicant $134,715.00 Respondent’s superannuation Respondent $60,143.00 TOTAL $783,277.00
Second pool Asset Held by Value J Street property Respondent $700,000.00 TOTAL $700,000.00
The applicant, by his case outline, submitted that contributions for the first pool should be assessed at 60% in his favour. In submissions, the applicant’s counsel took a more creative approach in suggesting that I should not start at a consideration of percentages, rather that the only way to achieve a just and equitable outcome, citing Stanford, was to look at the possible outcomes for division of property. Whilst it is true that Stanford supports the notion that the overall outcome must be just and equitable, the way to arrive at orders that are just and equitable is to assess contributions to the acquisition, conservation and improvement of the parties’ property as a starting point.
The respondent, by her case outline and by her counsel in submissions, submitted that for the first pool, contributions should be assessed at 56% in her favour. This was in contrast to her own evidence, which was that in all respects during the course of their relationship it was an equal partnership. The applicant’s evidence also bears this out. It is clear that both these parties worked very hard and balanced the care arrangements for X as best they could with their respective work situations.
The applicant was in a modestly superior financial position at the commencement of the relationship to that of the respondent and money he held in a fixed term deposit was applied to the acquisition of the Suburb G property. I take his greater initial contributions into account.
The applicant received a gift of $10,000 from his mother in 2019. I take this into account in assessing contributions.
The applicant also submitted that contributions to the respondent’s family should be taken into account (presumably as a contribution to the welfare of the family under s 79(4)(c) or perhaps pursuant to s 75(2)(o)) in two ways. First, he said that the respondent’s brother living with them should be taken into account. Whilst it was uncontentious that the respondent’s brother was living with the parties for some time, under cross-examination the applicant admitted that the respondent had commenced paying rent in early 2018, he had repaid the parties some $11,000, and that he had helped care for X during some periods the applicant was incapacitated due to a surgical operation. There was clearly mutual benefit for both the parties and the respondent’s brother, and I do not consider that him staying with the parties should be taken into account as a contribution.
Second, the applicant gave evidence that the parties transferred money to the respondent’s family in Country C. On his recollection, they sent about $15,000 in total. The respondent gave no evidence on this issue. She did not deny the applicant’s evidence and he was not challenged on it. Whilst I cannot make any finding about quantum given the paucity of the evidence, I accept that some money was sent to the respondent’s family in Country C and take that into account as a contribution.
Post-separation, the respondent has been contributing more significantly to X’s care than the applicant. The applicant has been unable to work due to his medical condition.
Given the length of the marriage, the roughly equal contributions by each of the parties throughout the relationship and taking into account the slightly greater contributions of the applicant at its commencement, from his mother and for contributions to the respondent’s family and the respondent’s greater post-separation contributions, I assess overall contributions at 53% in favour of the applicant and 47% in favour of the respondent.
On that basis, the applicant will receive $415,136.81 and the respondent will receive $1,068,140.19 (including the J Street property).
The respondent submitted there should be a 6% ($46,996.62) adjustment in favour of the applicant. The applicant submitted it should be in the order of 35% ($274,149.95).
The applicant has a permanent disability and is indefinitely unfit for work. He is in receipt of NDIS services which offset his treatment costs, but he has no capacity to receive an income. He receives a disability support pension. He gets some assistance from his mother, but that is not particularly great. Although it is not entirely clear from the evidence, it seems that the applicant has a full-time carer or support worker.
The respondent has qualifications but has not since obtained employment in that area. She is currently studying English. Apart from having to care for X, she has the capacity to return to gainful employment, although it is not likely to be highly paid. She also has, by virtue of her lottery winnings, an unencumbered home and access to the support of her brother, to whom she gifted half of the lottery winnings. She will, however, be caring for X the majority of the time without any real prospect of child support from the applicant.
There should be a significant adjustment to the applicant in the order of 20% of the value of the first pool. In dollar terms, that equates to $156,655. This adjustment is modest compared to the property owned by the respondent in the second pool and her capacity to earn an income. Therefore the first pool will be divided in the order of 73% to the applicant and 27% to the respondent.
The parties can each retain property owned solely by them. To divide the funds on trust such that the respondent receives 27%, $130,930.00 will be paid to the respondent from the funds on trust. The balance will be paid to the applicant. orders to that effect, I am satisfied, will be just and equitable.
I certify that the preceding sixty-four (64) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Jarrett. Associate:
Dated: 14 February 2024
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