Egan and Egan - [2016] FamCA 1109

FAMILY COURT OF AUSTRALIA

EGAN & EGAN

[2016] FamCA 1109

FAMILY LAW – PROPERTY – Initial contributions – dispute between the parties as to the husband’s initial contributions – where the husband owned a property at the commencement of cohabitation which forms part of the current pool – where the property represents a significant part of the pool – 70/30 assessment made upon contributions – responsibility of the wife to maintain the adult children of the relationship – where the wife has no legal duty to maintain the children – s 75(2)(e) considered – where the husband disputes the responsibility of the wife to support the adult children – where the wife has produced no current evidence as to any dependency of the children upon her – where the husband has provided financial support to the children – where the wife seeks an adjustment in her favour based upon the reduced life expectancy of the husband – where the husband has been diagnosed with prostate cancer currently in remission – Lawrie considered – where the husband’s life expectancy as given by his medical practitioners is less than that expected for a man of the husband’s age – adjustment made in the wife’s favour – final property orders made as to a 60/40 split in the husband’s favour

Family Law Act 1975 (Cth)
Income Tax Assessment Act 1997 (Cth)
Superannuation Industry (Supervision) Regulations 1994 (Cth)

Bateman & Bowe [2013] FamCA 253
Clauson & Clauson (1995) FLC 92-595
Dickons & Dickons [2012] FamCAFC 154
Fontana & Fontana [2016] FamCAFC 11; (2015) FLC 93-688
Lawrie & Lawrie (1981) FLC 91-102
Mallett & Mallett (1984) 156 CLR 605
Marker & Marker [1998] FamCA 42
Norman & Norman [2010] FamCAFC 66
Omacini & Omacini [2005] FamCA 195; (2005) FLC 93-218
S & P (unreported, Family Court of Australia, Fogarty, Lindenmayer and Finn JJ, 29 April 1997)
Stanford & Stanford (2012) 247 CLR 108
Vass & Vass [2015] FamCAFC 51

APPLICANT:

Ms Egan

RESPONDENT:

Mr Egan

FILE NUMBER:

MLC

10206

2013

DATE DELIVERED:

21 December 2016

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

Macmillan J

HEARING DATE:

22, 23 & 24 August and 16 December 2016

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Thompson

SOLICITOR FOR THE APPLICANT:

Hayes & Associates

COUNSEL FOR THE RESPONDENT:

Mr Wilson

SOLICITOR FOR THE RESPONDENT:

Kennedy Partners

Orders

IT IS ORDERED THAT

The husband and the wife do all acts and things and sign all necessary documents to forthwith distribute to the wife the balance of the funds together with any interest thereon held in trust on behalf of the husband and the wife by the husband’s solicitors, Kennedy Partners.
Upon settlement of the sale of the property situate at and known as B Street, Suburb C, City D, United Kingdom the husband pay to the wife the sum of $155,761 less an amount equivalent to the difference between $466,133 and the amount paid to the wife pursuant to paragraph 1 of these orders.
That paragraphs 3 to 7 (inclusive) of these Orders are binding on the Trustee of the BT SuperWrap QROPS (“the Fund”).
The base amount of $300,000 be allocated to the wife out of the husband’s interest in the Fund.
Pursuant to s 90MT(1)(a) of the Family Law Act 1975 (Cth) whenever a splittable payment becomes payable in respect of the husband’s interest in the Fund, the wife shall be entitled to be paid an amount calculated in accordance with Pt 6 of the Family Law (Superannuation) Regulations 2001 (Cth) using the base amount and there be a corresponding reduction in the entitlement of the person to whom the splittable payment would have been made but for these Orders.
Paragraphs 4 and 5 have effect from the operative time.
The operative time for the purposes of paragraphs 4 and 5 of these Orders is four business days after the date of service of these Orders upon the Trustee of the Fund.
Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:
(a)       each party be solely entitled to the exclusion of the other to all superannuation and other property (including choses-in-action) owned by or in the possession of such party as at the date of these orders;
(b)       insurance policies remain the sole property of the owner named thereon;
(c)       each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and
(d)       any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
On or before 4.00 pm on 3 February 2017 the parties file and serve any written submissions in support of any application for costs arising out of or incidental to the hearing of this matter.
On or before 4.00 pm on 17 February 2017 the parties file and serve any reply to any written submissions in support of any application for costs arising out of or incidental to the hearing of this matter.
The question of costs be determined based upon the parties’ written submissions subject to leave being sought to make oral submissions.
All extant applications, save and except for any applications for costs, be otherwise dismissed and the matter be removed from the list of pending cases awaiting hearing.
IT IS DIRECTED THAT
All documents produced to the Court pursuant to subpoena and exhibits relied upon by the parties be returned by the subpoena clerk of the Family Court of Australia, Melbourne Registry, to the person or organisation who produced same after the expiration of thirty (30) days from the date of these orders, or otherwise upon the conclusion of any appeal.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Egan & Egan has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 10206 of 2013

Ms Egan

Applicant

And

Mr Egan

Respondent

REASONS FOR JUDGMENT

The husband and wife in this case were married in the United Kingdom in 1995. Although there is a dispute as to when the parties commenced cohabitation, the difference between the parties on that issue is not significant. On either party’s case, the relationship is one of some 20 odd years. There are two adult children of that relationship.
Although the parties have been able to resolve some areas of their dispute, there remain a number of significant issues in the case about which they cannot agree and which the Court must determine. They include the following:
·what, if any, add backs there should be to the property of the parties;
·what property the husband brought to the relationship and its value at that time;
·what weight should be given to the husband’s contributions by reference to their value at the commencement of the relationship and their value now;
·what weight should be given to the contributions made by the wife in particular her contributions as a homemaker and parent both during the relationship and post separation, and her contributions to the improvement and maintenance of property brought to the relationship by the husband;
·what adjustment, if any, should be made in the wife’s favour having regard to the parties’ respective life expectancies and what she says is her ongoing responsibility for the two adult children of the marriage and the financial burden this places upon her; and
·finally, as the parties were unable to agree upon the mechanics of the orders what, if any, split there should be of the husband’s superannuation entitlements.
Subject to their respective positions vis-à-vis these issues, both parties in this case seek orders adjusting their legal and equitable interests in property. The husband’s case was in summary that he should be entitled to 65 per cent of the value of the Agreed and Disagreed Pool for division (“the agreed and disagreed pool”), which on his case included his UK PEPs account, his superannuation and the property he said should be notionally added back to the pool of property to be divided, a total pool of $3,038,661. This was excluding the $25,000 he said had been double counted. The husband proposed that the wife receive the proceeds of sale of E Street, Suburb F, City D (“the Suburb F property”) and a further sum of $272,318 based upon that pool in addition to those amounts she would be retaining or of which she had already had the benefit.
The wife’s case was that she should be entitled to 60 per cent of the agreed and disagreed pool, which included an amount of $25,000 the husband said had been double counted, plus those amounts the parties had spent on the legal fees, a total pool of $2,865,317. Her case was that she should receive the proceeds of the Suburb F property and the balance of her entitlements by way of superannuation based upon her figures a sum of approximately $1,118,977.

Background

The husband in this case was born in the United Kingdom in 1946. He is currently 70 years of age. The husband has been diagnosed with prostate cancer and is now retired.
The wife was born in New Zealand and is currently 59 years of age. The wife worked in Australia for some years before moving to the United Kingdom in late 1993. The wife is not currently engaged in employment.
There are two adult children of the marriage who were both born in the United Kingdom.
The parties commenced cohabitation in either late 1993 or early 1994 and were married in the United Kingdom in 1995. They lived in the United Kingdom until 2007 when they relocated to Australia. They separated in March 2012, living separately and apart under the one roof until the wife left the then former matrimonial home in December 2013.

Legal Principles

The husband and wife agree that it would be just and equitable for the Court to make orders adjusting their respective interests in property and in my view the test in Stanford & Stanford (2012) 247 CLR 108 (“Stanford”) is one that as the High Court said at paragraph 42 is readily satisfied:
… by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship…
The discretion to make orders for property settlement whilst broad is not unfettered and having determined that it is just and equitable to make property orders the Court must, in considering what orders should be made, take into account the matters in s 79(4) of the Family LawAct 1975 (Cth) (“the Act”) and thereafter make such orders as it considers appropriate.

Material Relied Upon

The wife who was the applicant in this case relied upon the following documents:
·Amended Initiating Application filed 23 March 2016;
·her Trial Affidavit filed 10 June 2016 (“the wife’s Trial Affidavit”);
·her Affidavit in Reply filed 29 July 2016 (“the wife’s Affidavit in Reply”);
·Affidavit of Ms G filed 1 May 2016;
·Affidavit of Prof H affirmed 22 August 2016;
·Case Outline filed on behalf of the Applicant Wife filed 18 August 2016; and
·her Financial Statement filed 10 June 2016;
The husband relied upon the following documents:
·Amended Response to Initiating Application filed 30 March 2016;
·his Trial Affidavit filed 6 July 2016 (“the husband’s Trial Affidavit”);
·Affidavit of Dr I filed 14 June 2016;
·Outline of Case on behalf of the Respondent Husband filed 18 August 2016; and
·his Financial Statement filed 5 July 2016.
Counsel for each of the parties also relied upon a written outline or summary of their final submissions.
A significant part of the evidence in this case related to historical events and both parties tendered various documents upon which they sought to rely in support of their case which related to the early history of the marriage and in particular the property brought to the marriage by the husband and how it was dealt with during the marriage and in particular in the early years of the marriage.

Standard of Proof

The standard of proof in this case is the balance of probabilities (s 140 of the Evidence Act 1995 (Cth)). In applying that standard the court must have regard to the following matters:
(a)the nature of the cause of action or defence; and
(b)the nature of the subject-matter of the proceeding; and
(c)the gravity of the matters alleged.

The Evidence

Although counsel for both the husband and the wife had prepared lists of their objections to the evidence of the other party they ultimately agreed that objections to evidence would not be argued and determined prior to or during the hearing of the trial and that the Court would determine any relevant objections to evidence when making findings of fact for the purpose of giving reasons for judgment and the matter proceeded on that basis.
Both the husband and the wife gave brief oral evidence and were cross-examined. Counsel for the wife submitted that the wife was both a good and reliable witness and that I should not only accept her evidence but in so far as there might be a dispute between her evidence and the husband’s evidence that I should prefer her evidence. I did not find the wife to be a good witness. Her Affidavits of evidence in chief were highly critical of the husband and in cross-examination she appeared to find it extremely difficult to make any concessions that she perceived might assist his case even when in my view it was clearly appropriate to do so. My impression of the wife was that she tended to tailor her evidence so as to advance her case or what she perceived would advance her case. Counsel for the husband in his written submissions described the wife’s instructions to her counsel in relation to the husband’s superannuation at the commencement of cohabitation as “illustrat[ing] a degree of opportunism masked by semantics”.[1] In my view that is an apt description of the wife’s evidence generally.
[1] Submissions of the Respondent Husband, paragraph 26.
In my view the wife not only attempted to reconstruct what had occurred in the early years of the marriage but also attempted to interpret more recent evidence in a way she saw as supportive of her case. A clear example of this was her attempt to recast money paid to her by the husband out of his part property settlement as payment of an amount she said he had agreed to pay her, relying upon documents in order to do so but in circumstances where there had been no mention of any such agreement until the wife affirmed her Affidavit in Reply.. In my view this example certainly fits the description of “opportunism masked by semantics”.
The husband on the other hand was a good witness. In my view he did his best to answer the questions honestly and without, unlike the wife, an eye to the impact of each and every answer upon his case generally. He readily made concessions in circumstances where the wife could or would not.
The other significant difference between the evidence of the husband and the wife, particularly with respect to his initial contributions and the early years of the marriage, was that the husband was giving evidence in relation to matters about which he had direct knowledge whereas the wife’s evidence was often a reconstruction of events based upon documents produced by way of discovery, but about which she appeared to have little if any direct knowledge.
Although in my view not all that much turns on credit, in this case where there is a dispute between the husband’s evidence and the wife’s evidence I prefer the husband’s evidence.

Property for Division

The parties were largely agreed upon the property and its value and prepared a joint Aide Memoire (the agreed and disagreed pool). That property is as follows:

Agreed and Disagreed Pool for division		24 August 2016
At today’s exchange rate of £1 = $1.73 (AUD)	Wife’s Value	Husb.’s Value
Joint
1 Inv. Bal. proc.s sale Suburb F property	466,133	466,133
Husband
2 a. Suburb C (gross value) (£450k)	778,500	778,500
b. less mortgage (£200,000)	-346,000	-346,000
c. equity =	432,500	432,500
3 BT Superwrap QROPS at 23 August 2016	1,465,272	1,465,272
4 UK Peps bank account (£41,775)	72,271	72,271
5 J Bank (accrued net rental) (£9,804)	16,961	16,961
disp.Husband’s CBA account	25,000	double-counting
6 sub-total (Husband)	2,012,004	1,987,004
Wife
7 UK Peps bank account (£12,695)	21,962	21,962
8 HESTA superannuation	4,599	4,599
9 sub-total (Wife)	26,561	26,561
10 Total Net Assets	2,504,698	2,479,698
Financial Resources
11 Husb.’s UK Govt. pension (E£29,000) (not received)	49,300	49,300
12 Wife’s remainder interest in NZ ppty in Family Trust	NR	NK
Wife’s Addbacks
13 Husband’s paid legal costs (143,800 + 55,000)	203,800
14 Wife’s paid legal costs	107,519
15 sub-total (Wife’s addbacks)	311,319
Husband’s Addbacks
16 Wife’s interim distributions from proc.s sale Suburb F	225,000
17 Monies removed from joint account by Wife	30,182
18 HESTA superannuation received by Wife	118,337
19 counter-adjustment in Wife’s favour	-75,000
20 sub-total (Husband’s addbacks against Wife)	298,519
21 Husband’s interim distributions from proc.s sale Suburb F	185,000
22 Monies removed from joint account by Husband	13,000
23 other BT superannuation received by Husband	13,144
24 sub-total (Husband’s addbacks against himself)	211,144
25 sub-total (Husband’s addbacks)	509,663

Although in that Aide Memoire the husband’s United Kingdom Government Pension was described as a financial resource, the husband ultimately included it as property when he calculated what he said should be the parties’ respective entitlements.
Apart from add backs the parties were $25,000 apart on the pool. Counsel for the husband submitted that this was a result of the wife having double counted the sum of $25,000 in the husband’s CBA account which he submits is made up of the balance of the amount he received by way of interim property distribution (which has already been accounted for at item 21 of the agreed and disagreed pool and which the husband says should be nominally added back) together with other monies he received post-separation, including monies withdrawn from his superannuation the week prior to the trial and rental income from the property at B Street, Suburb C, City D, United Kingdom (“the Suburb C property”), the monies in that CBA account being used to meet his living expenses. Counsel for the husband submitted that in all of the circumstances the husband’s CBA account should not be included in the pool of assets available for division. Whilst it is not possible on the evidence before me to determine exactly how much of the balance of that account is made up of monies he received by way of interim property settlement, I am satisfied that in all of the circumstances there is at least some element of double counting and I do not propose to include the CBA account in the pool of property to be divided between the parties.

Add Backs

As the High Court said in Stanford, when faced with competing applications for property settlement the court must first be satisfied that it is just and equitable to make orders adjusting the legal and equitable interests in property of the parties in the case. In order to be so satisfied and to make orders adjusting those interests the court must first identify the existing property interests. It is at this point that the question of what, if any, add backs there should be becomes an issue in the case. It is this focus on the existing legal and equitable interests which has fuelled much of the debate, particularly since Stanford, about the addition of notional property to the pool.
Although the court in making orders pursuant to s 79 of the Act is altering the parties’ existing interests in property that is not to say, as the Full Court said in Vass & Vass [2015] FamCAFC 51, that the court cannot make that adjustment based upon a pool of property which includes sums which have been notionally added back to that pool. Although prior to the High Court handing down its decision in Stanford the Full Court emphasised that add backs should be the exception not the rule, there are a number of decisions post-Stanford which suggest that the case for add backs may be, depending on the circumstances of the particular case, even more tenuous.
Although the categories of cases in which the court has added back notional property to the pool are not closed, whether pre or post-Stanford there have been three clear categories of cases in which the court has considered it appropriate to do so. They are as identified in Omacini & Omacini [2005] FamCA 195; (2005) FLC 93-218 in summary as follows:
(a)where one or both of the parties have expended money on legal fees that might otherwise have been available;
(b)where there has been a premature distribution of matrimonial property; and
(c)where, as described by Baker J in Kowaliw and Kowaliw (1981) FLC 91-092, one of the parties has embarked on a course of conduct designed to reduce or minimise the value of the property or has acted recklessly or negligently having the same effect.
Although the parties were largely in agreement with respect to the available property and both agreed that property should be notionally added back to the pool, there were significant differences between them with respect to what they each submitted should be nominally added back to that pool. I am satisfied, as submitted by the husband, that although the parties do not agree upon how the monies they each received or retained for their benefit post separation should be treated, there was no dispute as to the actual figures.
During the course of the proceedings the parties agreed to notionally add back to the pool the sum of $311,319 being the combined total of the legal costs they had paid. Of that amount $203,800 is attributable to the legal costs the husband has paid and $107,519 is attributable to those paid by the wife. This was in accord with the way in which the wife put her case.
The husband’s case however was that the add backs, which would include the legal fees they had each paid, should be as follows:
Wife’s Add backs:
·Interim distribution from proceeds of sale of the Suburb F        $225,000
Property
·Monies removed from joint accounts by the wife            $ 30,182
·HESTA Superannuation received by the wife  $118,337
Sub-Total  $373,519
·Less adjustment in wife’s favour  $ 75,000
Total  $298,519
Husband’s Add backs
·Interim distribution from proceeds of sale of the Suburb F      $185,000
Property
·Monies removed from joint accounts by the husband                  $ 13,000
·BT Superannuation received by the husband  $ 13,144
Total  $211,144
On the husband’s case, taking into account the proposed adjustment of $75,000 in the wife’s favour, the total of the add-backs would be $509,663.
The husband based his calculations on the wife having received an additional $20,000 from the proceeds of sale of the Suburb F property by way of part property settlement. It is the husband’s case that they each received a total of $205,000 from the proceeds of sale of the former matrimonial home but that in October 2015 the wife had claimed that she was in urgent need of funds and that on 1 September 2015 at her request he had paid her $20,000 from his share, an amount he said should be deducted from the amount he had received, making that amount $185,000, and added to the amount received by the wife making that $225,000. Although there appears to be some confusion, particularly on the part of the husband with respect to the dates, the wife in her Affidavit in Reply at paragraph 54 acknowledged that the husband had paid her $20,000 but said that “the amount of $20,000 paid by the husband was part of monies owed to me from income retained by the husband during cohabitation” and that on that basis there is no need to make the adjustment the husband submitted should be made.
The wife was cross-examined at some length about this issue. Notwithstanding that the wife ultimately conceded that it was not until she affirmed her Affidavit in Reply to the husband’s Trial Affidavit on 28 July 2016 that she had either challenged this aspect of the husband’s evidence or referred to the alleged agreement, she was quite insistent that she had not needed money and had not told the husband she was short of funds or asked him for money albeit she ultimately said when pressed that the children had told the husband she needed money. The husband’s evidence is also consistent with the letter from the wife’s solicitor dated 29 September 2015 in which she referred to the wife being in a difficult financial position because of the adjournment of the trial. The wife also conceded that she had not said to the husband at the time that he owed her money nor asked for repayment.
When it was put to the wife in cross-examination that her characterisation of the $20,000 as a repayment of monies owed to her by the husband was a recent construct, she referred to the spreadsheets prepared by the husband which she said supported her case. The wife was cross-examined about the spreadsheet dated 5 September 2015 attached to an email sent to her by the husband. When it was put to the wife that there was no suggestion in that email that the husband owed her the amounts she alleged it was her evidence that there was “to a certain extent”. It is clear from that email that what the husband was attempting to do was to reach agreement with the wife in relation to the property pool not in relation to the payment of the amount the wife now says was owing to her. The husband in that email said as follows:
Attached is a draft for the Property Pool. It could be good if we could agree it.
The Headings only represent in who’s name the assets are currently vested not necessarily where they will end up.
I have taken the actual pieces of property as at Separation and then taken their current day value. I have done a 12 month rolling average for the pension for the moment.
I have taken a Nett of GBP430,000 for [Suburb C] to take into account any selling costs and potential Capital Gains tax. I have used an exchange rate of $2.11 for [Suburb C] + Mortgage, the PEPs and the balance of 2013 [Suburb C] Rent not transferred to AUS
I have also added back those items that have come to me directly namely; part of the [Suburb C] rent to Dec 2013 and half the 2013/2014 Pension draw. This takes us to Dec 2013. The other half of the Pension Jan-June 2014 I have counted as part of my Income. Similarly [Suburb C] Rent from Jan-Jun 2014 I have counted as income. If the Court determines that a percentage of QROPS and [Suburb C] are marital property, then part of the Jan to Jun 2014 income will need to be added back to marital property
Even if the Court were to accept the wife’s evidence, the figure in the spreadsheet is not the figure the wife now asserts she was owed.
Although the wife said that she had not intended to extrapolate, because of the husband’s willingness to add back certain amounts to the property pool that he had agreed to pay her half of that amount, in my view that appears to be exactly what she has done.
Not only had there been no mention of the alleged agreement until the wife swore her Affidavit in Reply, there was also no evidence other than the wife’s assertions in that Affidavit as to an agreement with respect to the amounts the wife says she was owed by the husband or any agreement as to when or how those amounts allegedly owing were to be paid.
I am satisfied on the balance of probabilities that the wife’s assertion that the $20,000 paid to her by the husband was part of the monies owed to her from income he had retained was a recent construct in circumstances where it had become clear to the wife that the husband was claiming that the $20,000 should be treated as part of the monies she had received by way of part property settlement. I accept the husband’s submission that it is appropriate to treat that $20,000 as part of the amount that the wife received by way of part property settlement, making that figure $225,000 and, making the corresponding deduction from the amount the husband received, leaving him with $185,000 by way of part property settlement.
As previously referred to in his calculations the husband also allowed an amount of $75,000 on account of child support since separation. When the parties physically separated in December 2013 the two children remained living with the wife. Mr K was by that time 18 and Ms L was 16. Counsel for the husband submitted that this figure is reasonable in circumstances where:
·the wife accepts the husband’s evidence that since separation he has paid her amounts totalling $30,000, although I am satisfied on the balance of probabilities that the figure of $30,000 includes the $20,000 the husband paid the wife out of the monies he received by way of part property settlement; and
·on 24 July 2015 the wife sold her Transurban shares and retained the proceeds of sale of $14,901.
These amounts were not amounts the husband sought to have added back. It is also the case that until May 2014 the wife was in full time employment with earning income of $110,000 per annum inclusive of benefits and bonuses.
Although counsel for the wife submitted that her support of the children post separation was a contribution which weighed in her favour, he did not really take issue with the concept of there being an adjustment as proposed by the husband.
Whereas it is the wife’s case that only those amounts each of the parties have spent on legal costs should be added back to the pool, it is the husband’s case that there have also been what are in effect premature distributions of property to both parties and that subject to the adjustment of $75,000 he proposes on account of monies spent by the wife for the support of the children following separation, all of those amounts should be notionally added back to the pool.
I am satisfied that as counsel for the husband submits the parties have received by way of part property settlement or have had access to a combined total of $584,663, not otherwise accounted for referred to in paragraph 39 of these reasons or $509,663 on the basis of the adjustment of $75,000 proposed by the husband.
Counsel for the husband submitted in circumstances where it is agreed that the amounts the parties have spent on legal costs is to be notionally added back to the pool and taking into account the husband’s adjustment of $75,000, that it is the remaining balance of $198,344 which the husband submits should similarly be added back to the pool.
I am not satisfied that only adding back the amounts the parties have paid for their legal costs would achieve justice and equity in this case. As Murphy J said in Bateman & Bowe [2013] FamCA 253 at paragraph 52 (“Bateman”) :
A particular consideration in that respect is that an addback brings to account, in current dollar terms and in current circumstances, a dollar for dollar accounting of past actions undertaken in past circumstances expressed in past dollar terms.
That is clearly the case with respect to the amounts the parties agree should be added back on account of their costs. However in this case the parties have consented on two separate occasions to orders by way of part property settlement. The first of those orders was made on 8 May 2014 and was as follows:
1.That from the monies invested in the names of the parties with Kennedy Partners, due to mature in May 2014, the following be paid as to $50,000 to each of the parties, on account of part property settlement.
There was a notation to those orders to the effect that the parties had also agreed that the monies invested with Kennedy Partners be used to pay arrears of private school fees, future fees for Ms L’s attendance at such school as the parties might agree upon, to be paid upon production of invoices and such further sums as the parties might agree.
A further order was made by consent on 17 December 2014 that:
… from the monies invested with Kennedy Partners representing the balance of the proceeds of sale of the former matrimonial home, the sum of $50,000 be paid to each party, such sum to be on account of property settlement, and to be brought into account in that manner by the trial Judge in due course AND IT IS NOTED that the sum of $50,000 comprises the sum of $25,000 paid to each party in August 2014 and the sum of $25,000 paid to each party in November 2014.
The parties agree that they also each received by way of part property settlement the sum of $25,000 in January 2015, $30,000 in May 2015 and a further $50,000 in October 2015 making a total of $205,000 each.
To do as the wife proposes would mean that the monies the parties each received by way of part property settlement and which they each applied, at least in part, to their legal costs would be added back on a dollar for dollar basis, whereas those amounts not applied to legal costs would not be accounted for in the same way. In this case to the likely disadvantage of the husband who appears to have applied more of the monies he received to his legal costs. In all of the circumstances I am satisfied that those amounts the parties each received by way of part property settlement should be treated in the same way and notionally added back to the pool. This results in a total of $410,000 being the $185,000 received by the husband and the $225,000 received by the wife being notionally added to the pool. This leaves the sum of $174,663 or on the basis of the adjustment of $75,000 in the wife’s favour $99,663 of the amount that the husband says should be added back to the pool unaccounted for.
However, I am also not satisfied that it would be just and equitable to add back all of those amounts the parties have received post separation as proposed by the husband.
Counsel for the husband submitted that it is incumbent upon the wife to prove that she required in excess of $75,000, being the amount the husband conceded should be deducted on account of child support, and that absent that proof, all of the capital sums received or retained by the wife, in addition to those amounts she received by way of part property settlement should be notionally added back to the pool. I do not accept that submission. Firstly it is the husband’s case that the allowance of $75,000 was in lieu of child support. Secondly and in my view more significantly this ignores the reality of life after separation. As the Full Court said in Marker & Marker [1998] FamCA 42 per Baker, Kay and Chisolm JJ at paragraph 2.11:
… Neither the Family Law Act nor the case law require that parties go into a state of suspended economic animation once their marriage breaks down pending the resolution of their financial arrangements. Parties are entitled to continue to provide for their own support ...
Although the wife’s case is that she used the balance of the money she received to meet what she says were reasonable living expenses for herself and the children, it is not possible other than in a general sense to determine how and for what purpose those monies have been applied or to make precise findings as to either the amount or reasonableness of her expenditure for the children or for that matter the necessity for that expenditure. Even if it were possible for the wife to account with such specificity for her expenditure, I am not satisfied that she should be required to do so particularly in circumstances where the husband has also had the benefit of both rental income and his superannuation.
I am satisfied that a dollar for dollar adjustment of the funds the husband has received or retained exclusive of the part property settlement he received, albeit in his case he has applied them, at least in part, to the payment of his legal costs, and those the wife has received is not a course the Court should adopt in all of the circumstances of this case. It remains the case that add backs should be the exception and not the rule and although there were in my view circumstances which justified the notional add back of the monies the parties each received by way of part property settlement, that does not mean that the other monies they have received should also be added back. This is particularly so when as Murphy J in Bateman pointed out the dollars being notionally added to the pool are in current dollar terms accounting for past actions, and where the timing, purposes and reasonableness of those actions in this case are unclear.
I am also satisfied that there is ample scope in s 75(2)(o) of the Act to take into account the monies the parties received or retained in addition to their respective part property settlements and that a just and equitable outcome is more likely to be achieved in doing so.
Finally I am not satisfied based upon the husband’s evidence, particularly in the absence of evidence as to its value, that it is appropriate to include any remainder interest the wife may have in the estate of her parents in the agreed and disagreed pool.

The Adjusted Pool

The parties agreed that the applicable exchange rate for those items of property valued in GBP£ should be the exchange rate on the day prior to judgment being delivered. The adjusted pool, having regard to my various findings, and that exchange rate is therefore as follows:

Exchange rate as at 20 December 2016 of £1 = $1.71 (AUD)	Value
Joint
1 Inv. Bal. proc.s sale Suburb F property	466,133
Husband
2 a. Suburb C property (gross value) (£450k)	769,500
b. less mortgage (£200,000)	-342,000
c. equity =	427,500
3 BT Superwrap QROPS at 23 August 2016	1,465,272
4 UK Peps bank account (£41,775)	71,435
5 J Bank (accrued net rental) (£9,804)	16,765
6 Husb.’s UK Govt. pension (E£29,000) (not received)	49,590
7 sub-total (Husband)	2,030,562
Wife
8 UK Peps bank account (£12,695)	21,708
9 HESTA superannuation	4,599
10 sub-total (Wife)	26,307
11 Total Net Assets	2,523,002
Addbacks
12 Wife’s interim distributions from proc.s sale Suburb F	225,000
13 Husband’s interim distributions from proc.s sale Suburb F	185,000
14 sub-total (add-backs)	410,000
15 Total Net Assets (including add-backs)	2,933,002

Contributions

Although it was submitted by counsel for the husband and ultimately conceded by counsel for the wife that the parties’ contributions during the relationship in their myriad forms primarily on the wife’s part as both homemaker and parent and on the husband’s part as breadwinner should be treated as being equal, this does not sit comfortably with counsel for the wife’s written submission at paragraph 1 that “whatever the nature and value of financial contributions at the commencement of the relationship by the Husband, they are matched by an equally large and significant component of direct and indirect contributions by the Wife as a parent and homemaker and in supporting the Husband in his career as a businessman …”. He further submitted that “the two spheres of contribution by each party when compared, do not assume greater weight than the other. The Wife’s case is the Husband’s initial monetary contribution does not outweigh the Wife’s contributions in parenting and homemaking and other direct and indirect contributions. Indeed, both are of equal statutory weight”. Whilst I agree that these contributions may be of equal statutory weight, in my view the only logical way in which counsel for the wife’s submission can be put is that the wife’s contributions during the relationship would have to be afforded greater weight than those of the husband during the marriage in order to ameliorate the superior initial contributions of the husband, albeit that is not ultimately the way in which she put her case.

Although counsel for each of the parties referred to the parties’ initial contributions, and their contributions both during the relationship and post separation, as the Full Court said in Dickons & Dickons [2012] FamCAFC 154:
23. … There is in our view little to be gained, and much to be said against, approaching the task of assessing contributions by attaching percentages to components of it. …
24.There can be little doubt that the classification of contributions by reference to terms such as “initial contributions”, “contributions during the relationship”, and “post-separation contributions”, can be helpful as a convenient means of giving coherent expression to the evidence in a s 79 case and to giving coherence to the nature, form and extent of the parties’ respective contributions. However, the task of assessing contributions is holistic and but part of a yet further holistic determination of what orders, if any, represent justice and equity in the particular circumstances of this particular relationship… The essential task is to assess the nature, form and extent of the contributions of all types made by each of the parties within the context of an analysis of their particular relationship.
There is however a dispute in this case both as to the financial contributions made by the husband and the wife at the commencement of the relationship and the weight to be given to those contributions and the wife’s contributions post separation and what weight they should be given.

Initial Financial Contributions

The husband’s case is that at the commencement of cohabitation he had assets of some GBP£634,380 which he said based upon the exchange rate as at 31 March 1994 amounted to approximately AUD$1,359,462. This was made up as follows:
·the unencumbered Suburb C property, which he estimated was worth no less than GBP£85,000;
·his business M Ltd which he deposed had net assets of around GBP£60,000 based upon what he said was their real value not book value, including bank accounts and two motor vehicles being a recently purchased European motor vehicle, worth around GBP£11,500 and a 1985 hatch-back worth around GBP£1,500;
·monies owed to M Ltd by Company N for a project which he deposed started in 1992 and concluded in 1994. Although the business issued proceedings against Company N claiming in excess of GBP£1 million the case ultimately settled with Company N paying M Ltd GBP£180,000 in 1997;
·his director’s loan account balance of GBP£55,280 as at 31 March 1994, being monies owed to him by M Ltd upon which he said tax had already been paid;
·his superannuation/pension entitlements which he estimated had a combined value of GBP£208,000;
·various investments in unit trusts and savings plans with an estimated value of GBP£31,100;
·monies he had lent to a friend to buy a property which was secured by a percentage charge over that property and which he estimated to be worth GBP£14,000; and
·art, antique and objets d’art which he estimated to be worth GBP£10,000.

The Suburb C Property

There is no dispute that at the commencement of cohabitation the Suburb C property, which the husband still owns, was unencumbered. There is however a dispute as to when cohabitation commenced and what Suburb C was worth at the relevant time whether that is late December 1993 as the wife asserts or on the husband’s case March 1994. As previously discussed I generally prefer the husband’s evidence to that of the wife however as counsel for the wife submitted the dispute as to the date upon which cohabitation commenced is largely a matter of the parties’ perceptions rather than a matter which reflects upon their credit. In any event little turns in my view on the date upon which cohabitation commenced as the time difference is a matter of months at most and there is nothing to suggest that the different dates would have any real significance in monetary terms or otherwise to the parties’ respective cases.
As counsel for the wife submitted the husband has not obtained a retrospective valuation of Suburb C at the commencement of cohabitation nor is there any other evidence of its value at that time. However, although the husband conceded that the value he attributed to the property was only an estimate I also note that the wife had at various times during the proceedings estimated the property as being worth between GBP£60,000 and £80,000.
The husband in his Trial Affidavit deposed that he had purchased Suburb C in late 1984 for GBP£52,000 and had completed that purchase in January 1985. Although it was put to the husband in cross-examination that in his Affidavits filed 10 June 2014 and 24 August 2015 he had given inconsistent evidence in relation to the date of purchase of Suburb C, I am satisfied that this was as the husband said, a mistake, and was neither an attempt on his part to mislead the Court nor a reason why the Court should not have confidence in his evidence generally.
There was also no dispute that in November 1998 Suburb C was valued by Barclays Bank at GBP£130,000. The husband said that he had settled upon his estimate of value by working back from the bank’s valuation.
Counsel for the wife submitted that as the husband is not a qualified valuer the Court should reject his evidence as to value. He set out in some detail what he said were the flaws in the husband’s evidence as to value. In my view this misconstrues the nature of the husband’s evidence. I am satisfied that the husband was not suggesting that he was a qualified valuer or that his evidence was anything but an estimate of the property’s value. What both he and the wife, as lay not expert witnesses, have done is to provide their own estimates of what they each think the property was worth at the commencement of their relationship. In my view it is in the circumstances of this case a question of weight rather than admissibility.
Counsel for the wife referred me to the decision of the Full Court in Clauson & Clauson (1995) FLC 92-595 (“Clauson”) which he said was authority for the proposition that the husband’s evidence is “a rough and primitive guide” or an “initial point of reference” and cannot be relied on as a calculation of the husband’s initial contributions. Although the Full Court in Clauson at 81,910 did refer to “a rough initial point of reference” this was in the context of the husband in that case attempting to attribute a dollar amount to his initial contributions and the Full Court concluding at 81,909 to 81,910 that “[i]t is neither practical nor desirable to approach cases in such a pseudo mathematical way but nevertheless it does provide a rough initial point of reference”.

Superannuation and Pension Plans

Counsel for the wife in opening also said that it was the wife’s case that the husband had not had any superannuation prior to 1995 when he set up a self-managed superannuation fund. When the wife was cross-examined in relation to this issue she said that it was her understanding that in the United Kingdom superannuation was only described as such in the context of self-managed funds being otherwise referred to as pensions or policies. In my view there was a significant degree of artifice and opportunism in the distinction drawn by the wife based upon which her counsel opened her case. As submitted by counsel for the husband the wife ultimately conceded that the husband had had the various superannuation/pension plans to which he had deposed.
The wife was also critical of the husband’s estimates as to the value of his various superannuation/pension plans. Although counsel for the husband submitted that the husband’s estimates were corroborated by the letter from O Ltd dated 8 April 2014 which was put to the wife in cross-examination, the only figure which is actually corroborated by that letter is in relation to the husband’s Manulife Plan No … which was transferred to his self-managed superannuation fund when it was started on 31 October 1995. To the contrary the letter makes clear that O Ltd was unable to confirm the value of the husband’s P Executive Pension Plan or the P Personal Pension Plan as at the commencement of what the husband said was the date of cohabitation.
The husband confirmed in cross-examination that in relation to both the P pension plans and life insurance policies and the Norwich Union Unit Trust investment that he had either relied upon statements for periods after the commencement of cohabitation or the amounts he received when he surrendered those policies or investments and worked back from those figures in order to estimate their value as at the commencement of cohabitation. He used the same process to place a value on the percentage charge over the property purchased by Ms Q to secure the money he had lent to her for that purchase.
In her Trial Affidavit the wife also deposed as follows:
50.In late 1995 the business had been involved in a dispute in respect of an amount of work done by his business for [Company N] and ultimately this case was settled in August 1997 and the settlement sum was placed into the Husband’s superannuation.
51.The Husband is claiming that the settlement monies from [Company N] is an initial contribution but I dispute this allegation.
52.I am unaware of the exact amount of the Husband’s superannuation at the date of cohabitation.
53.The Husband has given me various documents and has made calculations as to his initial contributions. These are difficult to reconcile.
Thereafter in her Affidavit in Reply to the husband’s Trial Affidavit in which he had deposed both to his initial contributions and the contribution of the monies M Ltd had recovered from Company N to his self-managed superannuation fund, the wife, based upon documents which were in most cases discovered by the husband, and albeit it is predominantly argument not evidence:
·deposed as to why the Court should not accept the husband’s calculations;
·used her own calculations to provide her own estimate of the value of husband’s assets at the commencement of cohabitation; and
·also raised the possibility that the husband may have made contributions to some of the superannuation/pension plans after the commencement of cohabitation.
The wife also disputed the husband’s case that the sum of GBP£180,000 which was paid into his self-managed superannuation fund in or about 1997 was as he said money paid to him by Company N referable to a contract for work performed by M Ltd for Company N between 1992 and 1994, prior to the commencement of cohabitation and which he said should on that basis be treated as part of his initial contributions.
It is clear from the wife’s evidence that she had little or no direct knowledge of these matters and that her evidence was essentially a retrospective reconstruction of events based upon her interpretation of the documents provided by the husband. The husband on the other hand had personal knowledge of these matters and in my view was generally a reliable witness, giving evidence based upon his recollection of events rather than attempting to reconstruct those events. As previously discussed I prefer the husband’s evidence.
Although the husband conceded in cross-examination that at least part of the money received by M Ltd was paid “ex gratia”, and there is no dispute that the GBP£180,000 which was paid into the husband’s superannuation was received after the commencement of the cohabitation, I accept the husband’s evidence and as submitted by his counsel that whatever the basis of the payment may have been, it was directly related to M Ltd’s contract with Company N entered into and for services performed prior to the commencement of cohabitation. Further that the litigation which followed was in relation to that contract and the services provided by M Ltd. This issue is relevant both with respect to the husband’s assets at the commencement of cohabitation but also with respect to what, if any, contributions the parties made to these assets during the relationship.
Although the Court cannot attribute exact values to the husband’s property at the commencement of cohabitation or thereabouts, I am satisfied, in circumstances such as these where the property owned by the husband at the commencement of cohabitation is still largely intact and still forms a significant part of the pool and in relation to which the parties have made only limited, if any, further contributions during the relationship, that the husband’s estimates provide a “rough initial point of reference” and are of assistance to the Court in assessing the parties’ respective contributions and the weight to be given to them.
Counsel for the husband also submitted that in circumstances where those initial contributions are not only directly referable to the current assets but where those assets have significantly increased in value during the relationship, the Court should take into account the current value of those assets. He relied upon the decision of Norman & Norman [2010] FamCAFC 66 where the Full Court at paragraph 26 quoting from the decision of the Full Court in Cabbell and Cabbell [2009] FamCAFC 205 said:
…
We think that there is force in the proposition that a reference to the value of an item as at the date of the 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, if still intact, may not give adequate recognition to the importance of its contribution to the pool of assets ultimately available for distribution towards the parties. Thus where the pool of assets available for distribution between the parties consists of say an investment portfolio or a block of land or a painting that has risen significantly in value as a result of market forces, it is appropriate to give recognition to its value at the time of hearing or the time it was realised rather than simply pay attention to its initial value at the time of commencement of cohabitation. But in so doing it is equally as important to give recognition to the myriad of other contributions that each of the parties has made during the course of their relationship.
In this case the assets brought to the relationship by the husband are not only still intact and have risen significantly in value but I am satisfied that the parties have also had the benefit during the marriage of:
·living in the Suburb C property;
·rental income from the Suburb C property thereafter;
·the use of the Suburb C property to secure borrowings of some GBP£200,000 to finance their relocation to Australia and the purchase of the Suburb F property upon their arrival in Australia;
·access to 25 per cent of the then value of the husband’s superannuation fund which was applied to the purchase of the Suburb F property the proceeds of which form part of the agreed and disagreed pool; and
·income from the husband’s superannuation following his retirement to meet the family’s expenses.
Even accepting the wife’s evidence as to her contribution project managing the improvements to the Suburb C property, which were for the most part acknowledged by the husband albeit he said he was also involved and financed those improvements and had been solely responsible for significant improvements to the property prior to the commencement of cohabitation, it was a very small apartment. I accept counsel for the husband’s submission as to the limited significance of those improvements in that context. There is also no evidence to support the wife’s assertion that those improvements added substantially to the value of the property.
The wife also asserted that between 1997 and 2005 she managed the rental of the Suburb C property. Although the husband acknowledged that the wife had managed the rental of the property during this period I am satisfied that in circumstances where the property was generally rented for cash to friends of friends that the wife’s task was not particularly onerous.
It was submitted by counsel for the husband, which is consistent with the wife’s own evidence and I accept, that the wife’s only contribution to the husband’s superannuation funds was that after they relocated to Australia she accompanied him to meetings with their stockbrokers from time to time and would give him her opinion which he says he valued with respect to the investment of the superannuation in shares, albeit he said that the share trading was limited.
It was the wife’s case that at the commencement of the relationship she had savings of approximately $75,000 and personal effects of $23,000 made up of the following:
·a redundancy payment of $23,000 held in trust by her stockbroker which she deposited into her Westpac account when she and the husband travelled to Australia for a holiday in February 1994;
·approximately $10,000 which she used to buy a fireplace for the Suburb C property, an engagement present for the husband, to pay for her return trip to the United Kingdom and to pay for the transportation of her belongings to the United Kingdom;
·an Australian tax refund of about $5,000 which she received in 1994;
·shares which she said were valued at approximately $8,000;
·Australian superannuation of approximately $29,000 accumulated prior to her move to the United Kingdom in 1993; and
·jewellery, antiques, carpets and paintings worth approximately $23,000.
The husband’s case was that the wife had had property including superannuation and personal effects of approximately $85,000. Although the wife did not produce any evidence in support of her claim, the parties’ positions are not all that far apart and whether it was almost $100,000 as the wife asserts or $85,000, the difference in all of the circumstances of this case is not material.

Wife’s Contributions Post Separation

It is common ground that the children left the former matrimonial home with the wife in December 2013 and it is her case that she was thereafter responsible for their physical, emotional and financial support. Mr K was by then 18 and Ms L was 16. Albeit that both the husband and the wife had a duty to maintain Ms L until she turned 18, Mr K was by the time of separation already an adult. It is the wife’s case that although she may not have had a duty to maintain Mr K, he was unable to physically care for himself and required her financial support. Although the husband acknowledged that following separation the wife had been both physically and financially responsible for Mr K’s care, he also questioned both the reasonableness of that expenditure and the necessity for the level of care the wife asserted the children required and their ongoing requirements for care.
That being said the wife certainly bore both the physical and financial responsibility for Ms L whilst she completed her secondary education, a contribution not matched by the husband save and except to the extent that the proceeds of sale of the Suburb F property were applied to the payment of Ms L’s private school fees.
Although it was the wife’s case that the husband did not pay any child support, she also conceded that she had not applied for child support and was for at least some months after the parties’ physical separation engaged in full time employment. Although it is the husband’s case that there should be a $75,000 adjustment in the wife’s favour, taking into account and acknowledging the wife’s responsibility for the children, albeit Mr K was already an adult following separation, that proposal was made in the context of the notional property he said should be added to the pool and is in any event after the fact.
Although I cannot be satisfied on the evidence before me as to the reasonableness of all of the wife’s alleged expenditure in this context or as to necessity for that expenditure on an ongoing basis, particularly with respect to Mr K, an issue I will address further in the context of the s 75(2) factors, I am satisfied that following separation the wife did provide both physical and financial care for the children and that some care, both physical and financial was required for both Mr K and Ms L. Notwithstanding these limitations and doing the best I can on the evidence before me I have had regard to the wife’s contributions to the welfare of the children post separation in weighing up the parties’ respective contributions.

Conclusions with Respect to Contributions

Although in her Affidavits the wife was at times critical of both the husband’s role as breadwinner and both the quality of his parenting and his contributions to the welfare of the family, she did not in any real sense take issue with his evidence as to the acquisition and maintenance of property or with respect to the income he earned or how it was applied during the relationship, nor were her criticisms of the quality of his contributions the subject of cross-examination. In my view her criticisms of the husband lacked substance and I am satisfied they were more likely a reflection of her negative view of the husband in the context of the breakdown of the relationship and an attempt on her part to present her case in a more favourable light. Although the husband did dispute the significance of the contributions made by the wife to the Suburb C property, he did not challenge the wife’s contributions either as a homemaker and parent or generally during the relationship. I am satisfied that the parties’ relationship was, as described by Deane J in Mallett & Mallett (1984) 156 CLR 605 at page 640, one in which the parties had “… adopted the attitude that their marriage constituted a practical union of both lives and property”. In that sense I am satisfied their contributions during the course of their relationship were equal.
However I must assess and weigh up all of the parties’ contributions and although I agree with counsel for the wife’s submission that the wife’s contributions should not be afforded less weight than the husband’s injection of capital at the commencement of cohabitation, it does not follow that the totality of their respective contributions is therefore equal.
Counsel for the husband submitted at paragraph 42 of his written submissions that the current combined value of the Suburb C property and the husband’s superannuation fund, a total of $1,897,772, represents 75 per cent of the value of the agreed and disagreed pool of property of the parties (excluding the husband’s CBA account). It also constitutes 60 per cent of what he referred to as the “adjusted property”, which on his case included the notional property he said should be added back to the pool less the $75,000 adjustment in the wife’s favour. The Husband’s calculations were based upon a different exchange rate than the one applied for the purposes of the agreed and disagreed pool. Based upon my findings and the figures in the agreed and disagreed pool, the Suburb C property and the husband’s superannuation represent 65 per cent of the “adjusted property”. This is without any allowance for the rental income from Suburb C or the drawings from the husband’s superannuation fund during the marriage.
Counsel for the husband submitted at paragraph 60 of his written submissions that whether the Court dealt with the Suburb C property and the husband’s superannuation on an asset by asset approach or globally with the other assets, the husband’s contributions were in any event overwhelming. Although I would not necessarily use the word “overwhelming”, I am satisfied that the property the husband brought to the relationship not only represents a significant proportion of the parties’ existing property interests, but that they have also had the benefit of living in the Suburb C property, rental income from the property thereafter, the use of the property as security for borrowings used to fund their relocation to Australia and both income and drawings from the husband’s superannuation during the relationship. I am also satisfied that when assessing all of the parties’ contributions, which include the property the wife brought to the relationship, those contributions favour the husband.
Although counsel for the husband submitted that on a strictly mathematical basis the husband’s contributions to the property of the parties as it now stands would exceed 85 per cent in his favour, it was his case that those contributions should be assessed at 80 per cent in the husband’s favour. Although I accept that the contributions of the parties weigh in favour of the husband, I do not agree that having regard to the length of the relationship and weighing up all of the parties’ contributions during that relationship that the contributions should be assessed as to 80 per cent in favour of the husband and 20 per cent in favour of the wife. This represents a disparity of 60 per cent which in dollar terms based upon my findings as to the property pool represents $1,759,801.
Weighing up and assessing all of the parties’ contributions, financial and non-financial, direct and indirect both at the commencement of and during the relationship and following the breakdown of that relationship up to the date of the final hearing, and their respective contributions to the welfare of their family, including the wife’s contributions post separation, I assess those contributions to be as to 70 per cent to the husband and 30 per cent to the wife a differential of 40 per cent which is in real terms $1,173,201.

Section 75(2) Factors

The husband in this case is 70 years of age. The wife is 59 years of age.
The husband has been diagnosed with prostate cancer with lymph node metastasis. The husband relied upon the Affidavit of his treating urologist Dr I filed 14 June 2016. The husband initially underwent radical prostatectomy in March 2015 and in August 2015 started and is continuing hormonal therapy after the finding of a positive iliac lymph node. He underwent further surgery to remove that lymph node in October 2015.
In his first report dated 9 February 2016 (Annexure MH2) Dr I said of the husband’s prognosis as follows:
It is hard to predict prognosis in this case and an oncologist would be in a better position to advise than myself, however survival will depend upon the ongoing response to current hormonal treatment and future response to chemotherapy. If the responses are good, then [the husband] could live for 10-15 years. If not then survival may be less than 5 years.
In his second report dated 3 June 2016 (Annexure MH3) Dr I reported that:
[The husband] has commenced second line hormonal therapy (Cosudex). This was in response to a rising PSA, while on first line therapy (Degarelix). His PSA has initially responded well to this additional treatment, falling from 7.4 to 0.38 and the current plan is merely to continue PSA monitoring ongoing.
The next step if his PSA starts to progress on this regimen will be chemotherapy, in which case we will refer to the … Oncology team who would administer the treatment.
With regard to prognosis and life expectancy, it is always hard to predict this accurately, but if the current response to treatment is durable with good response to future chemotherapy then 5-6 years could be reasonably expected and possibly as much as 10 years.
The wife sought and I made orders for the husband to be medically examined by her expert witness Prof H, Consultant Urologist at R Centre. In his report dated 18 July 2016 (Annexure DM3 to his Affidavit affirmed 22 August 2016) Associate Prof H described the husband as follows:
…
[The husband] looks very well and is an otherwise fit 70-year-old gentleman.
…
Therefore, in summary at present, [the husband’s] clinicalstate [sic] is:
1.Metastatic castration sensitive prostate cancer, on maximal androgen blockade with degarelix and bicalutamide.
2.Asymptomatic with good performance status.
I believe that his current management plan is entirely appropriate, and I agree with the strategy of observation while continuing maximal androgen blockade. In these circumstances, I would see the patient on a monthly basis with PSA, testosterone and bone profile. I woudl [sic] reserve further imaging until he became castration-resistant or developed symptoms suggestive of clinical progression.
With respect to the husband’s prognosis Prof H said as follows:
My prediction is that based upon his otherwise excellent performance status, [the husband’s] metastatic prostate cancer is likely to be the cause of his death if he does not develop other illnesses or have any unexpected incidents. As he is currently castration sensitive and fully responding to his current lines of therapy, I believe that his life expectancy is at least five years based on current available therapies. Indeed, as he has not yet failed his current line of therapy, it is conceivable that he may live for up to 10 years with aggressive subsequent lines of therapy.
Although counsel for the wife submitted that Dr I’s evidence was not persuasive and that Prof H as an oncologist was better placed to give evidence as to the husband’s prognosis, he did not cross-examine Dr I. Although Prof H was briefly cross-examined, neither his diagnosis nor his prognosis was the subject of any challenge. In my view the evidence of Dr I is generally consistent with the evidence of Prof H and it is not a question of preferring the evidence of one or the other. For my purposes whether it is as Dr I says “with good response to future chemotherapy then 5-6 years could be reasonably expected and possibly as much as 10 years” or as Prof H says “at least five years based on current available therapies” and that “it is conceivable that he may live for up to 10 years with aggressive subsequent lines of therapy” makes little difference to the outcome of this case.
Counsel for the wife also relied upon the Table of Life Expectancy which he said demonstrated that the husband’s current life expectancy based upon that table is 14.76 years and that the wife’s life expectancy based upon those same tables at her current age of 59 is 26.89 years. Those figures, which do not take into account the particular circumstances of the parties in this case, were not contested.
Counsel for the wife submitted that the principles enunciated by the Full Court in Lawrie & Lawrie (1981) FLC 91-102 (“Lawrie”) are applicable to this case. Although I am satisfied that the wife’s life expectancy is likely to be greater than that of the husband, the facts of this case are very different to those in Lawrie. The Full Court in Lawrie said at 76,750 as follows:
It is appropriate and, in my view, necessary to consider the relative future needs of the parties in determining what is a just and equitable order under sec. 79. Where there is a significant disparity that would ordinarily be reflected in the orders. This is frequently a result in cases of a more usual type. Further, where in any case it is clearly established that the future financial needs of a party will terminate (or perhaps significantly diminish) upon the happening of a definite future event, it is proper to take that into account. A number of examples of that readily spring to mind. The weight to be given to that will obviously vary from case to case.
… any concern that the upholding of the orders in this case may open the floodgates to disputes in other cases as to the future life expectancy of parties is misplaced. This case is unique because of the particular circumstances that the evidence as to the husband's life expectancy was clear and not in controversy and related to an early future date. Further and in any event, the task is to do what is just in the case at hand.
…
In Lawrie the husband had an agreed life expectancy of about six months. In Fontana & Fontana [2016] FamCAFC 11; (2015) FLC 93-688 (“Fontana”) the Full Court also referred to the decision of S & P (unreported, Family Court of Australia, Fogarty, Lindenmayer and Finn JJ, 29 April 1997) (“S & P”) in which the husband, who was HIV positive, had an agreed life expectancy of five years. In S & P the Full Court said at pages 23 to 24 as follows:
We consider that the approach adopted by the majority of the Full Court in Lawrie’s case is correct in principle. However, each case must ultimately be decided on its own particular facts and the conclusion is ultimately an exercise of discretion within s.75(2) and overall within s.79.
In principle, it is correct, as Mr George conceded, to take into account the fact (if it be so) that the future needs of one of the parties within s.75(2) will be limited or diminished by some future event. For example, where it is clear that at the end of a particular period a party will, by inheritance or otherwise, come into substantial property which may limit or diminish that person’s “needs” within s.75(2), at least in comparison with the longer term “needs” of the other party. Here the circumstances are especially tragic and although it is a difficult thing to say, the fact remains that on the uncontested evidence the husband’s needs will terminate within the predicted time whereas the wife’s needs will be likely to continue beyond that time.
I do not agree as submitted by counsel for the husband that Fontana in any way limits the principles enunciated in Lawrie and the cases that subsequently followed it. To the contrary in my view and as submitted by counsel for the wife those principles are confirmed by the Full Court in Fontana at paragraph 26 in circumstances such as those in this case where there is clear expert evidence related to “shortened life expectancy of a predictable duration arising from a medical condition”.
I am satisfied that although it is not as little as six months as was the case in Lawrie, the husband in this case does have a “shortened life expectancy”, likely to be somewhere between five and 10 years and if he were to live for 10 years that would be five years less than his life expectancy based upon the Table of Life Expectancy. In all of the circumstances I am satisfied that in these circumstances the husband’s life expectancy as compared to that of the wife is a matter the Court should take into account and I have done so.
Although the wife did not otherwise challenge the husband’s evidence with respect to his future needs, there was a significant dispute with respect to the wife’s future needs vis-à-vis what she said was her commitment to the care and support of the two adult children.
One of the matters to be taken into account pursuant to s 75(2)(d) of the Act is the commitments of each of the parties that are necessary to enable that party to support him or herself and a child or another person that party has a duty to maintain. The duty to maintain a child or another person is a legal duty. In circumstances where both of the children of the marriage are over the age of 18 years the wife has no legal duty absent an order to that effect to support those adult children.
However the Court must also take into account “the responsibilities of either party to support any other person” (s 75(2)(e) of the Act). Although it is not necessary for there to be a legal duty to support that other person, the Court must be satisfied that the person for whom responsibility is claimed is unable to support themselves. In this case, the two adult children.
It is the wife’s case as set out in her Case Outline filed 18 August 2016 that:
58.[Mr K] needs supervision by the Wife in order to maintain stability. He does not work and all indications are that he is likely to remain dependent upon the Wife.
59.[Ms L] presently sees a psychologist when necessary. She completed Year 12 in 2015 and qualified for [a degree]. Ms L commenced her course in the month of February 2016 but at the conclusion of the first semester in June 2016 she dropped out of the course and deferred it for a period of 6 months. [Ms L] commenced living in rental premises but continued to spend regular time with the Wife – up to 2 days per week. [Ms L] has made it clear that she wishes to return to study in 2017, at which time she will return to live with the Wife.
It is also the wife’s case that she had to leave her employment to care for Mr K.
In her Financial Statement filed 10 June 2016 the wife deposes to weekly expenditure of $2,356. She attributes $940 directly to the two adult children which includes inter alia $100 per week for their activities, $40 for their entertainment and hobbies and $80 per week for their holidays. Although it is difficult to see how the wife could sustain this level of expenditure, the dispute in this case was not so much as to the amount the wife says she spends on the children but rather her responsibility or need to do so.
The wife sets out in some detail in her Trial Affidavit the history of Mr K’s psychological issues which she says are the reason she left her employment and why she now says he is totally dependent upon her. That evidence is in summary as follows:
·that in 2014 Mr K appeared to be frightened of being alone, suffered severe panic attacks and told the wife he was suicidal;
·that in April 2014 the husband and the wife arranged for Mr K to undertake a personality test as part of the Krongold Educational Assessment which had been suggested by a psychologist the husband and wife had consulted in 2012 in relation to both parenting and relationship issues;
·that in May 2014 Mr K had a serious panic attack and the husband had taken him to the Emergency Department at S Hospital;
·that it was following this panic attack that the wife deposes that it became clear to her that Mr K “needed me to be at home as he was so unwell” and as a result of which the wife gave a week’s notice of her intention to resign from her position;
·that once the wife was no longer in employment and at home Mr K’s panic attacks were less frequent and she said that he said he felt safer;
·that in December 2014 Mr K said he would go to the Centre for Adult Education (“CAE”) to complete Years 11 and 12. Although Mr K attended for the first two weeks he did not cope, his anxiety returned and when he found out that the husband had been diagnosed with prostate cancer he said that CAE was just like school and would not go back;
·that Mr K saw a psychologist twice in 2015. That the husband attended the second appointment with Mr K and although a third appointment had been organised for the wife to attend with Mr K, the husband had told the wife the wrong date and thereafter Mr K refused to attend any further appointments; and
·that Mr K’s condition has “again deteriorated to the point where [the wife has] to constantly keep him under observation”. That Mr K “suffers from low self-esteem, anger and depression” and “sleeps for much of the day and watches T.V. or is on [the wife’s] computer most of the night”.
The husband both in his Trial Affidavit and in cross-examination paints a somewhat different picture. Although he conceded that he thought Mr K had been a “troubled young man”, that he was still “difficult” for the wife to manage and that it may be that he is, albeit this is a layman’s view, “depressed” it was the husband’s evidence that:
·in early 2014 he was able to motivate Mr K to obtain his learner driver’s permit;
·in 2014 he arranged a job for Mr K in a café and initially drove him to work but that Mr K gave that job up after a short period;
·earlier this year Mr K worked for approximately six weeks as a casual building worker; and
·in recent months Mr K has admitted to him that he needs to move forward and has attended counselling of his own volition.
The husband and the wife clearly have very different views both in relation to dealing with Mr K and his problems and what is likely to lie ahead for Mr K. Although the husband did not dispute that Mr K may have been physically and financially dependent upon the wife and did not challenge in detail the amounts the wife said she was spending on the children, he did not accept that this was either necessary or for that matter, particularly with respect to Mr K, that it was in the children’s best interests.
In my view the wife has not established on the balance of probabilities that the support she provides, both physical and financial, in particular for Mr K, is necessary on an ongoing basis or that Mr K in particular cannot or should not support or physically care for himself. There is no current expert evidence as to any mental health issues Mr K may currently have, how they impact upon him and his ability to care for and/or support himself or what treatment or care he might require. The only evidence apart from the wife’s assertions is the S Hospital Emergency Department letter dated 12 May 2014 in which Mr K is described as suffering from anxiety and having had an anxiety attack and recommending referral to a psychologist to address that anxiety. The husband objected to the wife relying upon the letter from the S Hospital Emergency Department which was annexed to the wife’s Trial Affidavit on the grounds of hearsay. In my view even if the evidence had been adduced in an appropriate form it would in any event carry little weight.

The other evidence upon which the wife purported to rely was the Personality Assessment Inventory of personality testing carried out on 29 April 2014. Although counsel for the husband objected to the Emergency Department letter he did not object to the Personality Assessment Inventory which was similarly annexed to the wife’s Trial Affidavit. Arguably both these documents are hearsay evidence however for the purposes of the issues I must determine the problem is not that the documents are hearsay it is the content and currency of both the S Hospital letter and this document which is lacking, even if they were admissible. Both documents are over two years old and so do not address Mr K’s current state of health. More significantly, even if Mr K were still suffering from anxiety and having panic attacks as described in the Emergency Department letter or the Court were to be satisfied as to merits of the assessment of his personality style and accept the recommendations for treatment or the likelihood of success of that treatment, that would indicate nothing about Mr K’s current capacity to care for himself physically or to provide for his own financial support.
The wife’s concession during cross-examination that she has been considering travelling overseas for approximately one month and up to six weeks is also not consistent with her evidence that she must keep Mr K under constant observation or that he is dependent upon her for his physical care, albeit she did say that there was a possibility that Mr K might be accompanying her.
The husband also disputed that Ms L either intends to live with the wife after she returns to her studies or that she would in those circumstances be financially dependent upon the wife. For the reason I have already discussed I generally prefer the husband’s evidence but in any event there is no evidence, other than the wife’s general assertions, as to why Ms L cannot support herself or at the very least contribute to her own support. I am also satisfied that the husband has and will continue to provide Ms L with some financial assistance if she does actually require it.
Although it may be the wife’s preference to provide for all of Mr K’s physical needs and financially support both he and Ms L on an ongoing basis, that in my view is a choice rather than a responsibility. If it were a necessity one would expect evidence to that effect as would be required for the purposes of an application for adult child maintenance. There is no such evidence in this case. I am not satisfied on the balance of probabilities that the wife is either physically or financially responsible for the support for the parties’ two adult children.
The husband for obvious reasons is not in employment and there is no prospect of him obtaining employment given his age and state of health.
The wife’s own evidence is that she left her employment to care for Mr K in circumstances where there is no evidence to support her assertion that it was necessary for her to do so. The wife has no formal qualifications. I am satisfied that although the wife has been seeking employment, she has tended to seek employment in a particular field, one in which she has not been employed for many years, thereby potentially limiting her employment opportunities and that she might improve her prospects of employment if she were to broaden her search somewhat. That being said, as conceded by the husband, I am satisfied that the wife is now 59 years of age and even if she were to broaden her search for employment, her employment opportunities are likely in any event to be restricted by her age and lack of qualifications.
There will also be in this case, based upon my assessment of the weight to be given to the parties’ respective contributions, a disparity in their respective future financial positions based upon those findings to which I have had regard.
Finally, in circumstances where I added back the amounts the parties each received by way of part property settlement but did not add back capital they each received or retained from joint bank accounts or drew down from their superannuation following separation, I am satisfied that I should have regard to those amounts the parties have received or retained in addition to those sums they received by way of part property settlement. In the husband’s case this is the $13,144 drawn from his superannuation and the $13,000 removed from the parties’ joint account at separation.
The wife has had, in addition to the amounts she received by way of part property settlement, $30,182 removed from the parties’ joint accounts at separation, and $118,337 drawn from her HESTA superannuation fund in July and October 2015.
However I have also taken into account that the husband has agreed that there should be an adjustment of $75,000 in the wife’s favour to take into account her financial support of the children following separation. This would result in a difference between their respective positions of $47,375.
In so far as it is the wife’s case that the additional funds she has had have been used to meet reasonable living expenses for herself and the children, I have already taken into account her contribution to the support of the children post separation.
Counsel for the husband submitted that if the Court accepted his submissions with respect to the weight to be afforded to the husband’s contributions, then an appropriate adjustment in the wife’s favour would be 15 per cent. Counsel also submitted that if the Court did not accept the husband’s position with respect to his contributions there should be a lesser adjustment so as to provide for an adjustment as to 65 per cent to the husband and 35 per cent to the wife. These submissions were of course predicated on the Court adding back those amounts the husband submitted should be added back to the pool which I am not satisfied should occur.
I am satisfied that in all of the circumstances of this case having regard to the s 75(2) factors that there should be an adjustment in favour of the wife of 10 per cent which is in real terms $293,300 and which results in a disparity between the parties’ respective positions of $586,600.

Conclusion

Including the amounts they have each received by way of interim property distribution and the proceeds of sale of the Suburb F property which it is agreed the wife will retain, the parties currently have the following net property interests:

Husband		Wife
Asset	Value	Asset	Value
Suburb C property (net value in $AUD)	$427,500	Balance of the proceeds of sale of the Suburb F property	$466,133
BT Superwrap QROPS at 23 August 2016	$1,465,272	UK PEPS Bank Account ($AUD)	$21,708
UK PEPS Bank Account ($AUD)	$71,435	HESTA Superannuation	$4,599
J Bank Account ($AUD)	$16,765	Interim property distribution	$225,000
UK Government Pension ($AUD)	$49,590
Interim property distribution	$185,000
Total	$2,215,562	$717,440

In these circumstances orders will need to be made altering the parties’ existing legal and equitable property interests to give effect to the findings as to their respective entitlements, in order to secure the wife’s entitlement to 40 per cent of the value of the adjusted pool.
Not only should the adjustment I propose, both based upon percentages and in real terms be just and equitable, the orders the Court makes to give effect to that adjustment must also be just and equitable. In this case there is a dispute as to how this can be done. It is the husband’s case that the balance of the proceeds of sale of the Suburb F property held in trust by his solicitors on behalf of the parties (approximately $466,133) be immediately paid to the wife and that the balance of her entitlements be paid out of the proceeds of sale of the Suburb C property, which as at the date of the hearing was on the market for sale albeit that based upon my conclusions the proceeds of sale of the Suburb C property might not be sufficient to satisfy the wife’s entitlements. The husband’s case is that he will take the risk upon sale of the Suburb C property not realising the price the parties have agreed should be attributed to it for the purposes of these proceedings.
Counsel for the wife submits that the wife would be disadvantaged by the orders the husband proposes on the basis that those orders leave his substantial superannuation entitlements intact whereas she has minimal superannuation and that on that basis the Court should make a splitting order in her favour. The wife’s case is that the balance of the proceeds of sale of Suburb F in the sum of approximately $466,000 should be paid to her and that there should be a superannuation split so as to effect a division of 60 per cent of the pool in her favour. Based upon my findings as to the property pool the wife would on that basis be entitled to a superannuation split of $455,760.
Counsel for the husband addressed me with respect to the husband’s inability to replenish his superannuation funds in the event, as proposed by the wife, he was required to draw from those funds or the Court were to order a superannuation split to meet the wife’s entitlements in contrast to what he submitted was the wife’s ability based upon the Superannuation Industry Regulations to do so. Counsel for the husband relied upon the Australian Taxation Office’s “Personal super contributions” guidelines and reg 7.04 of the Superannuation Industry (Supervision) Regulations 1994 (Cth) in support of his submissions.
Although counsel for the wife disputed the wife’s capacity to make the contributions counsel for the husband submitted she would be able to make because of her age, counsel for the wife was not able to refer me to either legislation and/or regulations in support of his case. On that basis I granted leave to counsel for the wife to forward the relevant legislation and/or regulations upon which he relied in support of any limits upon the wife’s capacity to make contributions to personal superannuation. Pursuant to that order counsel for the wife forwarded a copy of an Australian Taxation Office (“ATO”) document titled “Your age and super contribution caps”. The parties also agreed to the husband forwarding to the Court the ATO commentary in relation to the bring-forward provisions for people under 65 and s 292.85 of the Income Tax Assessment Act 1997 (Cth).
I am satisfied that in circumstances where it is common ground that there is no prospect of the husband being gainfully employed that he has no capacity to make contributions to his personal superannuation. I am also satisfied that although there are annual limits upon the wife’s capacity to make both concessional and non-concessional contributions to her personal superannuation, if she is 64 years or younger on 1 July of the financial year and makes excess non-concessional contributions, the system will automatically bring forward the next two years’ non-concessional contributions.
Counsel for the wife submitted that there may be changes to the legislation and the regulations governing contributions to personal superannuation. I must determine this matter on the basis of the law as it presently stands rather than speculate as to the changes that might be made. However in the period between the completion of the case and my being in a position to deliver judgment legislation has been passed altering the contribution limits. On that basis I gave counsel the opportunity to make submissions with respect to the impact of those legislative changes.
I am satisfied that instead of the wife being able to make non-concessional contributions of $180,000 per annum she can now only make non-concessional contributions of $100,000 per annum.
This would arguably enable the wife, who is currently 59 years of age, to make a non-concessional contribution of up to $300,000 in the current financial year. This would preclude the wife from making any further non-concessional contributions for the next two income years however the wife, given her age, would on the basis of the current provisions, have further capacity to make non-concessional contributions prior to her turning 65, allowing her to add to her superannuation entitlements.
Although I accept that the husband has no capacity to top up his superannuation entitlements, it is also the case that there are limits to the wife’s capacity to provide for her future security by way of superannuation.
In all of the circumstances I am satisfied that to achieve justice and equity as between the parties I should accede, at least in principle, to the wife’s application and I propose to order a superannuation split of $300,000. I am satisfied that the trustees of the husband’s superannuation fund have been afforded procedural fairness with respect to the proposed superannuation splitting order. Although this will not provide the wife with the $1 million in superannuation she says she needs or for that matter leave her with the same amount of superannuation as the husband, I am satisfied that the orders I propose to make will achieve justice and equity as between the parties including that whereas the wife will have immediate access to the balance of the proceeds of sale of the Suburb F property, the husband will have to wait for his money until the Suburb C property is sold and will bear the risks associated with its sale. The remainder of the wife’s entitlement pursuant to my findings will be met by a payment from the husband to the wife of $155,761 from the proceeds of sale of the Suburb C property, subject to an adjustment for any accrued interest on the proceeds of sale of Suburb F.
The effect of the orders I propose to make is that the wife will have had the benefit of or retained the following:
(a)the funds she received by way of part property settlement in the sum of $205,000;
(b)the further sum of $20,000 paid to her by the husband in September 2015;
(c)her PEPS account of AUD$21,708;
(d)her HESTA superannuation of $4,599;
(e)the balance of the proceeds of sale of Suburb F held in trust for the parties by the husband’s solicitors of $466,133 together with interest thereon;
(f)a payment from the husband of $155,761 from the proceeds of sale of the Suburb C property, less an amount equivalent to the accrued interest on the proceeds of sale of Suburb F; and
(g)a superannuation split of $300,000.

I certify that the preceding one hundred and forty-one (141) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered on 21 December 2016.

Associate:

Date: 21 December 2016