FARLEY & MANOLY
[2013] FamCAFC 93
FAMILY COURT OF AUSTRALIA
| FARLEY & MANOLY | [2013] FamCAFC 93 |
| FAMILY LAW – APPEAL – NOTICE OF APPEAL – PROPERTY – where the appellant appeals property settlement orders made by a Federal Magistrate on 24 January 2012 – where the appellant says the Federal Magistrate did not give enough weight to her contributions and gave too much weight to the respondent’s contributions – where the appellant says that the Federal Magistrate was in error in taking into account contributions made by the respondent to the appellant’s three children from a previous relationship – where the appellant says the Federal Magistrate erred in determining that the inheritances introduced by the respondent “attracted” a loading of 5 per cent but then gave the respondent an additional 10 per cent of the net asset pool rather than 5 per cent – where there is no merit in any of the grounds of appeal – appeal dismissed. FAMILY LAW – APPEAL – NOTICE OF APPEAL – COSTS – where the respondent sought costs in the event that the appeal was dismissed – where the appellant opposed any order for costs being made on the basis of her financial circumstances – where the appeal was wholly unsuccessful and thus there are circumstances which justify an order for costs – appellant to pay the respondent’s costs of and incidental to the appeal as agreed or in default of agreement as assessed. |
| Family Law Act 1975 (Cth) – s 117, s 90SM(4)(c) |
| Gronow v Gronow (1979) 144 CLR 513 Norbis v Norbis (1986) 161 CLR 513 Steinbrenner & Steinbrenner [2008] FamCAFC 193 |
| APPELLANT: | Ms Farley |
| RESPONDENT: | Mr Manoly |
| FILE NUMBER: | LNC | 348 | of | 2010 |
| APPEAL NUMBER: | SOA | 11 | of | 2012 |
| DATE DELIVERED: | 13 June 2013 |
| PLACE DELIVERED: | Melbourne |
| PLACE HEARD: | Adelaide by video link to Launceston |
| JUDGMENT OF: | Strickland J |
| HEARING DATE: | 12 November 2012 |
| LOWER COURT JURISDICTION: | Federal Magistrates Court |
| LOWER COURT JUDGMENT DATE: | 24 January 2012 |
| LOWER COURT MNC: | [2012] FMCAfam 41 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Mr Ayliffe |
| SOLICITORS FOR THE APPELLANT: | Bishops Barristers & Solicitors |
| COUNSEL FOR THE RESPONDENT: | Mr Lewis |
| SOLICITORS FOR THE RESPONDENT: | Levis Stace & Cooper |
Orders
The appeal be dismissed.
The appellant pay the costs of the respondent of and incidental to the appeal, such costs to be assessed in default of agreement.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Farley & Manoly has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| IN THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT ADELAIDE |
Appeal Number: SOA 11 of 2012
File Number: LNC 348 of 2010
| Ms Farley |
Appellant
And
| Mr Manoly |
Respondent
REASONS FOR JUDGMENT
Introduction
By Notice of Appeal filed on 16 February 2012 Ms Farley (“the appellant”) appeals against property settlement orders made in these proceedings by Federal Magistrate Roberts, as he then was, on 24 January 2012. The respondent in the appeal is Mr Manoly (“the respondent”). He opposes the appeal.
In summary, the orders made by his Honour provided that the appellant, within 45 days of the date of the order, transfer to the respondent her interest in property C. Contemporaneously with that transfer, the respondent was to provide the appellant with a “complete release from her obligations” under the mortgage to that property, together with $34,000 by way of bank cheque. The parties were also to retain all “chattels, motor vehicles, money and other property in their respective possession and control”, and they were to indemnify each other against any “liability encumbered or charged against any property to which that party is entitled”.
On appeal the appellant seeks in effect that the orders made on 24 January 2012 be set aside, that the discretion be re-exercised on the basis that the appellant receive 55 per cent of the property pool and the respondent 45 per cent, the respondent pay the appellant’s costs of the appeal and “there be any consequential costs order as to the Trial and Application the Court deems
meet [sic].
Background
At the time of the trial the appellant was aged 58 years, and the respondent was aged 69 years.
There are two children of the relationship who at the time of the trial were aged 20 and 19 years respectively.
The parties met in 1979. At that time the appellant had three children from a previous relationship who were aged eight, six and three years respectively.
The parties were at odds as to the details surrounding cohabitation. The appellant asserted that there were two periods of cohabitation namely, from August 1994 until February 2001 and again from August 2007 until April 2009. The respondent asserted that the parties lived together from 1985 until 1998 and again from May 2007 until April 2009.
In June 1980 the appellant moved into a Housing Department home, property G, with her three children.
In 1985 the appellant purchased property G, and she became the sole registered proprietor. This was because the appellant was the leaseholder and it was only leaseholders who could purchase homes from the Housing Department. The parties agreed that the respondent made a payment of $5,000 to the appellant at the time of purchase, however they differed in what they said that amount was applied towards, with the appellant saying it was cash used for general living expenses and the respondent asserting it was the deposit for the purchase of property G.
In September 1992 the respondent received an inheritance from his mother’s estate in the sum of $46,500 which he says he contributed to the parties’ pool of assets.
In August 1997 the respondent received a distribution from his aunt’s estate in the sum of $49,810 which he says he applied to “the acquisition, improvement and maintenance of relationship assets with [Ms Farley]” (paragraph 37 of the respondent’s affidavit filed 22 August 2011).
In August 1994 the parties purchased property C in their joint names. The respondent contributed $40,000 towards the purchase price of $85,500.
Whilst separated, in late 2002/early 2003 the appellant sold property G and purchased in her sole name a block of land at P for $32,000. She then built a home on this land borrowing $120,000 from the National Australia Bank to do so. This property was sold in May 2007 with the net proceeds of sale being $149,000.
In March 2008 the appellant purchased property F in her sole name utilising $115,000 of the proceeds of sale of property P. Subsequently she spent $194,404 on renovations, comprising $54,404 from bank loans and $140,000 advanced to her by her mother to fund the construction of a unit at the rear of the property where she and the appellant’s father could live.
In April 2009 the parties separated for the final time with the appellant leaving property C.
The reasons for judgment of the federal magistrate
The Federal Magistrate commenced his reasons for judgment by referring to the “substantial disagreements about the periods of living together”. As can be seen the parties had been in a long term de facto relationship with periods of separation upon which they could not agree.
After considering the evidence before him, his Honour found on the balance of probabilities that the parties lived together from 1985 until February 2001, a period in excess of 15 years, and again from May 2007 until April 2009, a period of approximately two years.
His Honour found the appellant “deliberately chose to deny living with [the respondent] for a substantial period (i.e. from 1985 to 1994)”. This, together with other inconsistencies in the appellant’s evidence led his Honour to find that he preferred the respondent’s evidence wherever it conflicted with that of the appellant.
The Federal Magistrate then set out the relevant background facts and the law as it applies to de facto property settlement disputes.
His Honour found that he was able to hear the matter because the periods of cohabitation exceeded two years, there were children of the relationship, the relationship ended after 1 March 2009 and the parties were “ordinarily resident in Tasmania for the entirety of the de facto relationship”.
As to the asset pool, the Federal Magistrate recorded that the parties were able to agree the majority of assets as follows:
Property C $220,000 Ms Farley’s Mazda $3,100 Ms Farley’s Falcon $2,500 Mr Manoly’s Hilux $1,000 Mr Manoly’s Falcon $1,200 Mr Manoly’s Bank Account $24,048 Mr Manoly’s Bank Account $1,589 Ms Farley’s Bank account $100 Ms Farley’s Shares $250 Total $253,787
The parties were also able to agree liabilities as follows:
Property C mortgage $33,495 Ms Farley’s credit card $1,899 Ms Farley’s personal loan $5,023 Total $40,417
The major disagreement between the parties was how property F should be treated. It was agreed that at the time of the hearing before the Federal Magistrate that property F had been “heavily overcapitalised” by the appellant, she having purchased the property for $115,000, and then spending $194,404 on improvements, taking the total outlaid to $309,404. An “as is” valuation put the property at $200,000 resulting in an overcapitalisation of $109,404.
The appellant’s counsel submitted to his Honour that the property should be included in the asset pool at $200,000 and that all liabilities should also be included, effectively on the basis that “… both parties have to take some responsibility for what comes out of this relationship”. However, that was a submission with which his Honour disagreed.
In the end result his Honour added back $115,000; the purchase price of the property. It was his Honour’s view that that was the fairest approach “[b]ecause it does not make [the respondent] responsible for decisions in relation to [property F] that he played no part in”. Further, it also meant that the appellant’s mother’s equitable interest in the property, if any, need not be established.
Thus, the value of the net asset pool as found by his Honour was $328,370.
The Federal Magistrate then went on to consider the respective contributions of the parties. Again, the parties were unable to agree contributions with the appellant claiming she made the greater contribution towards household expenses and that the respondent had not contributed “sufficiently to those expenses”. His Honour preferred the evidence of the respondent who he said “contributed as generously as his earnings would allow.”
During the first period of cohabitation (from 1985 until February 2001) the Federal Magistrate found that the respondent’s financial contributions clearly outweighed those of the appellant, with the major contribution by the appellant during this period being as homemaker and parent. His Honour also noted that the respondent had made contributions to the appellant’s three children from an earlier relationship, even though he did not have to do so.
The Federal Magistrate found that during the first period of separation (February 2001 to 2007) the respondent made direct financial contributions to property C, he having continued to pay the mortgage and outgoings. The appellant was found to have used the proceeds from the sale of property G, a joint asset of the parties as found by his Honour, to purchase the land at P. At the time of sale of that property in 2007 its net value had increased significantly however, the Federal Magistrate found that that contribution should not be solely attributed to the appellant, the “seed funding” having come from a joint asset namely, property G. His Honour found the appellant to have made the greater homemaker and parent contribution during this period, and he also accepted that the respondent continued to pay all his assessed child support to the appellant.
When the parties resumed cohabitation in May 2007 his Honour found that the appellant contributed $8,000 to the improvement property C, but did not accept the appellant’s assertion that she paid all the bills.
After the final separation in April 2009 the Federal Magistrate found that the respondent “continued his contributions to the conservation of [property C] and [the appellant] continued to assist the parties’ daughter”. However, this was as far as his Honour could take the issue of each party’s contribution to the household expenses or mortgage post-separation, because neither was cross-examined on this topic.
His Honour considered that there should be a “weighing up” of the contributions of the parties during the entirety of their relationship, namely, from 1985 until their final separation in April 2009. As a result his Honour found the contributions to be of similar weight, apart from a 5 per cent adjustment in favour of the respondent as a result of his contributions from his two inheritances. Thus his Honour assessed the parties’ entitlement to the net asset pool as to 55 per cent to the respondent and 45 per cent to the appellant.
His Honour then went on to consider the s 90SF(3) factors. After weighing up these factors his Honour concluded that there should be no further adjustment in favour of either party.
The orders made 24 january 2012
The Federal Magistrate made the following orders:
1.That within 45 days [MS FARLEY] (“the Applicant”) must transfer to [MR MANOLY] (“the Respondent”) all her right, title and interest in the property known as [property C], more particularly described in Certificate of Title Volume … Folio … (“the property”).
2.That contemporaneously with the transfer referred to in Order No. 1 hereof the Respondent must:
(a)provide to the Applicant a complete release from her obligations under Mortgage number … secured over the title to the property; and
(b)the sum of thirty-four thousand dollars ($34,000.00) by bank cheque.
3.That from the date of this Order the Respondent has no claim to any interest in the Applicant’s property known as [property F], more particularly described in Certificate of Title Volume … Folio …
4.That the Applicant and the Respondent each otherwise retains all chattels, motor vehicles, money and other property in their respective possession and control as their sole property free from any claim by the other.
5.That the Applicant must do all things reasonably required to transfer to the Respondent all her right, title and interest in any property in his possession or control and for such purpose she must complete and sign any documents that may be required to register any such property in the sole name of the Respondent.
6.That the Respondent must do all things reasonably required to transfer to the Applicant all his right, title and interest in any property in her possession or control and for such purpose he must complete and sign any documents that may be required to register any such property in the sole name of the Applicant.
7.That each party is solely liable for, and must indemnify the other against any liability encumbering or charged against any property to which that party is entitled to pursuant to these Orders.
8. That all extant applications are dismissed, save as to costs.
The appellant appeals against all orders.
The grounds of appeal
The appellant set out her grounds of appeal in her Notice of Appeal filed on
16 February 2012 January 2012 as follows:
1.That the Learned Federal Magistrate erred in fact and in law in awarding the Respondent 55% of the property pool on the basis of his contribution of two modest inheritances during the relationship given:
i.The Appellant’s contribution of the dominant share of the proceeds from the sale of [property B];
ii. The length of the relationship;
iii. The Respondent’s concession as to a 50/50 split;
iv.The Appellant’s greater contribution as to the acquisition, conservation and improvement of [property G];
v.The Appellant’s contribution, direct and indirect, to [property C]; and
vi.The Appellant’s superior contribution as homemaker and carer, both during the relationship and during the separation.
2.The Learned Federal Magistrate erred in fact and in law in overlooking the dominant contribution of the Appellant to the sale proceeds of [property B], not withstanding any “seed funding” supplied from the Respondent.
3.The Learned Federal Magistrate erred in fact and in law in failing to assess and give full weight to the superior contribution of the Appellant to the acquisition, conservation and improvement of [property G] in that he failed to take into account the fact that the Appellant took out the mortgage in her name for the purchase of that property and that the Appellant conducted solely the leasing of [property G] after the parties moved to [property C].
4.The Learned Federal Magistrate erred in law in [71] in assessing as a contribution pursuant to Section 90FM contributions made to the Appellant’s three children when such children were not children of the de facto relationship
5.The Learned Federal Magistrate erred in fact and in law in that he failed to act on his finding in [74] that the Appellant was the major carer for the children of the relationship during the period of separation between cohabitation.
At the outset of the hearing of the appeal the appellant’s counsel sought leave to amend the appellant’s Notice of Appeal to add a further ground of appeal, namely Ground 6, as follows:
That the learned Federal Magistrate erred in law and fact by deciding that the inheritances introduced by the Respondent ought attract a loading of ‘5% of the net value of the asset pool’ but awarded the Respondent an extra 10% of the net asset pool for this factor.
There was no objection to the Notice of Appeal being so amended and I allowed the amendment as sought.
Ground 5 was not pursued, and conveniently, Grounds 1, 2 and 3 were addressed together.
Grounds of Appeal
Grounds 1, 2 and 3
These grounds challenge his Honour’s findings as to the respective contributions of the parties. In effect the appellant says that his Honour gave too much weight to the respondent’s contributions and too little weight to the appellant’s contributions, and thus erred in the exercise of his wide discretion.
The law in this area is settled and the principles that apply are well established.
In Norbis v Norbis (1986) 161 CLR 513, Brennan J said at 539:
The difficulties in the way of developing guidelines beset an appellate review of the exercise of discretion under s.79. Unless the primary judge reveals an error in his reasoning, the Full Court can intervene only if the order made is not just and equitable. How does the Full Court arrive at that conclusion? In Bellenden (formerly Satterthwaite) v Satterthwaite [1948]
1 All ER 343 at p. 345 Asquith L.J. stated the rationale of an appellate court’s approach:“It is, of course, not enough for the wife to establish that this court might, or would, have made a different order. We are here concerned with a judicial discretion, and it is of the essence of such a discretion that on the same evidence two different minds might reach widely different decisions without either being appealable. It is only where the decision exceeds the generous ambit within which reasonable disagreement is possible, and is, in fact, plainly wrong, that an appellate body is entitled to interfere.”
The “generous ambit within which reasonable disagreement is possible” is wide indeed when there are a number of factors to be taken into account and the comparative weight to be attributed to those factors is not clearly indicated by uniform standards and values of the community. The generous ambit of reasonable disagreement marks the area of immunity from appellate interference.
In Gronow v Gronow (1979) 144 CLR 513, Stephen J said at 519-520:
The constant emphasis of the cases is that before reversal an appellate court must be well satisfied that the primary judge was plainly wrong, his decision being no proper exercise of his judicial discretion. While authority teaches that error in the proper weight to be given to particular matters may justify reversal on appeal, it is also well established that it is never enough that an appellate court, left to itself, would have arrived at a different conclusion. When no error of law or mistake of fact is present, to arrive at a different conclusion which does not of itself justify reversal can be due to little else but a difference of view as to weight: it follows that disagreement only on matters of weight by no means necessarily justifies a reversal of the trial judge. Because of this and because the assessment of weight is particularly liable to be affected by seeing and hearing the parties, which only the trial judge can do, an appellate court should be slow to overturn a primary judge’s discretionary decision on grounds which only involve conflicting assessments of matters of weight.
Here it is said that his Honour failed to take into account the appellant’s “direct financial contribution arising from the purchase and sale of [property B]”, the appellant’s “superior contribution with respect to [property G]”, and in effect, the “primary role of the appellant as homemaker and child carer throughout the relationship …”.
As to the first issue the appellant’s counsel points out, correctly it seems, that the property at P was sourced and purchased solely by the appellant after the initial separation, that she alone arranged the finance from the Bank, that she again alone arranged for and oversaw the construction of the home, that she alone serviced the mortgage, and that she alone maintained the property until it was sold after five years. The evidence established that the only contribution made by the respondent to the acquisition, conservation and maintenance of this property was to the money used to purchase the land, namely the $32,000 obtained from the sale of property G, but the extent of that contribution is in dispute.
That leads into the second issue agitated by the appellant, namely that it was not open to the Federal Magistrate to find that the respondent made an “equal” contribution to the proceeds of sale of property G. I note though that his Honour did not find this specifically; it is an implication that the appellant’s counsel makes from his Honour saying in paragraph 73 of his reasons for judgment that he treats the proceeds as “a joint asset”, and then in paragraph 85 of his reasons for judgment finding that “the parties’ contributions should be given similar weight”.
In any event, the appellant’s counsel submits that the appellant “made the greater contribution to [property G]”. Again it seems that that is correct on the unchallenged evidence before his Honour. For example, the appellant had found and was leasing the property prior to cohabitation commencing, and she remained legally responsible for the rent because the respondent did not qualify as a Housing Department tenant. The appellant then purchased the property in her name and she took out a mortgage also in her name for that purpose, but with the respondent contributing $5,000. After the parties moved into property C the appellant managed the renting of property G, and the rental covered the mortgage repayments. Then finally, after the initial separation the appellant alone improved the property and later prepared it for sale and sold it.
Turning to the third issue, namely the appellant’s homemaker and parent contribution, it was common ground that at all material times, the appellant fulfilled the primary role in that regard.
Thus, the appellant says that the combination of her contributions in relation to property G and property P, and her primary role as homemaker and parent should have led his Honour to find that if anyone did, it was the appellant who made the greater overall contribution, and that in finding that the respondent should have a loading in his favour demonstrates that his Honour erred in failing to recognise and evaluate the significant contributions made by the appellant. However, the flaw in this submission is manifest on a fair reading of his Honour’s reasons for judgment.
This was an unusual case. His Honour found that the parties cohabitated from 1985 until February 2001, and then again from May 2007 until April 2009. Thus there were four periods of time in which the respective contributions of the parties needed to be assessed; the two periods mentioned, the period of separation, and the post-separation period after April 2009.
His Honour found, and this appears to be unchallenged, that in the first and most lengthy period, the respondent’s direct financial contributions significantly outweighed those of the appellant, primarily as a result of the inheritances that he received from his mother and his aunt. His Honour also found, correctly the appellant would say, that in this period the appellant’s “major contributions” were as a homemaker and parent.
Then, looking at the period of separation from 2001 until 2007, his Honour found, again unchallenged, that the respondent was “making direct financial contributions to the conservation of [property C] by paying the mortgage and the outgoings”. It was in this period that she sold property G, purchased the land at P and built the home thereon. His Honour though found that the increase in the net value of the property by the time it was sold in May 2007 “cannot be said to be solely [the appellant’s] contribution because the ‘seed funding’ came from the sale proceeds of [property G]”. Now for my part, no issue can be taken with that proposition; the only question is what weight should be attributed to the respondent’s contribution.
I observe at this point that the respondent’s counsel’s argument that at worst for the appellant she should be seen as contributing $133,000 of the net proceeds of $149,000 achieved upon the sale of property P and the respondent just $16,000, is misconceived. Apart from the fact that as his Honour correctly made clear in paragraphs 79 to 82 of his reasons for judgment that “the assessment of contributions is not an exercise of mathematical precision”, it is logical to assume that of the gross sale price the land represented more than the $32,000 for which it was purchased. Thus, on this argument the respondent’s contribution would have been more than $16,000. However, there is no evidence before his Honour as to the value of the land at the time of sale of the property.
In any event, to continue. His Honour went on to find, again correctly according to the appellant, that during this period of separation the appellant contributed more as a homemaker and parent than the respondent. His Honour also noted that the respondent paid all the child support that he was assessed to pay.
Then with the third period the major topic for consideration was the sale of property P and the use of the proceeds. As I have set out above the net proceeds of sale were $149,000. The appellant put $8,000 towards the cost of renovations at property C, and spent $9,000 upon the two children of the parties. However, the majority of the money, namely $115,000, was used by the wife to purchase property F in or about April 2008.
As to the post-separation period, the problem for his Honour was how to treat property F. As set out above, the appellant spent $194,404 on renovations, comprising $140,000 advanced by her mother on the basis that she would live there as well, and $54,404 from two loans from the Bank. However, the value of the property was only $200,000, rendering it overcapitalised by approximately $109,000. As a result his Honour determined to put aside the liabilities and notionally add-back to the asset pool the sum of $115,000. This approach was unchallenged on appeal.
As for other post-separation contributions his Honour recorded that the respondent “continued his contribution to the conservation of [property C] and [the appellant] continued to assist the parties’ daughter who was almost
17 years of age”. However, because of a lack of evidence his Honour was “unable to make a finding about the parties’ contributions to the welfare of the family during that post-separation period”.
To return for a moment to the use of the proceeds of sale from P, the complaint of the appellant is that his Honour failed “to identify and evaluate” the appellant’s contribution. However, I consider that his Honour did in fact do that. His Honour, early in his reasons for judgment, set out the detail of the sale of property G, the purchase of the land, the building of the home, and the sale of the property and the use of the proceeds. Thus, as I have already referred to, his Honour said this in paragraph 73 in his reasons for judgment:
73.During that same period, [Ms Farley] used what should be treated as a joint asset, in the form of the proceeds of sale of [property G], to purchase the land at [P]. By the time that she sold the property in May 2007, the net value had improved quite significantly. However, that cannot be said to be solely [Ms Farley’s] contribution, because the “seed funding” came from the sale proceeds of [property G] (which I find should be treated as a joint asset).
Thus, I can find no error here by his Honour.
Similarly, I can find no error in his Honour’s recognition of the contributions of the appellant to property G. In making his findings as to the periods of cohabitation his Honour referred to the history of property G including the respondent’s contribution of $5,000 to the purchase price (paragraphs 13 and 14 of the reasons for judgment), and the fact that the appellant returned there after separation, then spent 18 months preparing it for sale and finally sold it in 2002 for $62,500 netting $32,536. Later his Honour recorded that the appellant was able to purchase the property in 1985 because she was the tenant, and that she took out a mortgage of approximately $23,000 to complete the purchase (paragraph 26 of the reasons for judgment). Then in paragraph 39 of the reasons for judgment his Honour referred to the fact that when the parties moved into property C, the appellant let out property G and used the rent to meet the mortgage repayments. Thus it is apparent that his Honour had all of the relevant facts at the forefront of his mind, and it was unnecessary to repeat the same when addressing the issue of contributions except in a general way later in his reasons for judgment.
It is well to remember the words of Kirby J in AMS v AIF (1999) 199 CLR 160 at 211, namely, “that an appellate court, invited to review the exercise of discretion at first instance will avoid an overly critical, or pernickety, analysis of the primary judge’s reasons, given the large element of judgement, discretion and intuition which is involved.”
Significantly, after identifying the respective contributions of the parties over the four periods of time, his Honour then had to weigh up and assess those contributions and arrive at an overall result. His Honour clearly did this, as is apparent from the following paragraphs of his reasons for judgment:
79.As can also be seen from the quotation from Ferraro above, weighing up and comparing contributions of a different type is not an easy task. Indeed, it is clear that the assessment of contributions is not an exercise of mathematical precision. In Hayne and Hayne, Pawley J said:
In matters such as this one cannot approach the problem with an eye for meticulous detail. It should rather be dealt with broadly so that the end result can be said to be just and equitable.
80.In Garrett and Garrett the Full Court of the Family Court of Australia held that in long marriages, where the parties have devoted their resources and incomes for the benefit of the family, it is not possible to have a precise accounting of their contributions. The same must apply to de facto relationships, and I point out that both parties in this matter continued to make contributions even when they were separated.
81. In Clives and Clives the Full Court said:
We accept that the task to be undertaken by a trial Judge in assessing weight to be attached to initial contributions, and other contributions, is not always an easy one and not discharged by a strict accounting exercise.
82. Further in Kessey and Kessey the Full Court also said:
In many - indeed probably in most - property settlement cases the Court has to evaluate and assess contributions to property in the absence of precise valuations of the contributions in question. Indeed, where the contributions to property are indirect or non-financial, precise valuation is impossible, and even where the contributions are direct or financial so that a valuation might be provided, other factors (not capable of precise mathematical statement) may well have eroded the initial value of such contributions. In a case such as the present, it is not necessary to arrive at precise mathematical valuations of the parties' contributions - all that is necessary is to evaluate the weight that should be given to each party's contributions relative to the contributions of the other party.
83.Indeed, it is perfectly clear that an evaluation of the weight to be attributed to different types of contributions - such as direct financial contributions and indirect non-financial contributions - cannot be a mathematical exercise involving precise measurement.
84.In my view, this matter requires a weighing up of the contributions of the parties during the whole period from 1985 until their relationship finally broke down in April 2009. When I do that, I find that the parties’ contributions should be given similar weight, save that there should be a loading in favour of the husband, primarily arising from the contributions that he made from his two inheritances. That loading should be 5% of the net value of the asset pool.
85.I therefore conclude that if I was deciding this matter on contributions alone, it would be appropriate to attribute 55% to
[Mr Manoly] and 45% to [Ms Farley]. …(Footnotes omitted)
As was so well explained by Coleman J in Steinbrenner & Steinbrenner [2008] FamCAFC 193 at 234-236:
234.Given that the evaluation of contribution based entitlements inevitably moves from qualitative evaluation of contributions to a quantitative reflection of such evaluation, there will inevitably be a “leap” from words to figures. That is the nature of the exercise of discretion, whether it be in the assessment of contributions in the matrimonial cause, assessment of damages in a personal injuries case, or determination of compensation in a land resumption case. In some cases, the “leap” is so great, and so unheralded by the discussion which precedes it as to render the reasoning process defective. In this Court’s view this is not such a case.
235.Essentially, for the reasons which he carefully and accurately detailed by reference to the facts found by him, that, overall, the husband’s contributions vastly outweighed those of the wife, the learned Federal Magistrate grappled with the difficult question of “by how much”.
236.With respect to learned Counsel for the husband, what more his Honour could constructively have added to his Reasons for Judgment is difficult to imagine. Whether or not such conclusion was reasonably open to him, the learned Federal Magistrate adequately “spelt out” why he concluded as he did. The reader is not in any real doubt as to why the wife’s contributions were assessed as they were. The Court is not persuaded that the learned Federal Magistrate’s Reasons for Judgment were inadequate.
In my view his Honour could have been describing this case in those remarks.
Again, I can find no error in the exercise of his Honour’s wide discretion, and there is no merit in these grounds of appeal.
Ground 4
This challenge revolves around what his Honour said in paragraph 71 of his reasons for judgment, namely:
71.[Mr Manoly] also made contributions to the welfare of [Ms Farley’s] three children from a former relationship, and he was under no legal obligation to do so. I accept that he not only got on well with those children (as admitted by [Ms Farley]), but he played a role as a substitute father to them.
If his Honour was recording that with a view to taking that contribution into account in favour of the respondent then clearly his Honour was in error. Section 90SM(4)(c) of the Family Law Act 1975 (Cth) (“the Act”) only applies to children of the parties and not children of a former relationship. However, I accept the submission of the respondent’s counsel that this was an aside expressed in the context of his Honour’s findings as to the homemaker and parent contributions of the appellant, and it was not something his Honour was taking into account in the respondent’s favour.
In any event, even if I am wrong about that, I do not consider that it is an error that warrants appellate interference. It was accepted that the appellant made the greater homemaker and parent contribution and any credit given to the respondent incorrectly could not have altered that result. In particular, I do not accept the submission of the appellant’s counsel that his Honour would not have found that the contributions of the parties (apart from the inheritances) were equal if this factor was not taken into account; in my view it would have made no difference.
Accordingly, I find that this ground must fail, despite having prima facie merit.
Ground 6
This challenge appears to raise two issues; first that the Federal Magistrate erred in finding that the inheritances introduced by the respondent “attracted” a loading of 5 per cent of the net value of the asset pool, and secondly, that his Honour erred in awarding the respondent “an extra 10 per cent of the net asset pool for this factor” rather than just 5 per cent.
I have addressed the first issue in considering Grounds 1, 2 and 3 of the Notice of Appeal, and I have found no merit in that challenge.
As to the second issue, the challenge is misconceived. In saying that there should be a loading in favour of the respondent of 5 per cent of the net value of the asset pool, his Honour was not indicating that there should only be a differential of 5 per cent between the two parties. There is nothing in what his Honour said that indicates that. The relevant paragraphs of his Honour’s reasons are as follows:
84.In my view, this matter requires a weighing up of the contributions of the parties during the whole period from 1985 until their relationship finally broke down in April 2009. When I do that, I find that the parties’ contributions should be given similar weight, save that there should be a loading in favour of the husband, primarily arising from the contributions that he made from his two inheritances. That loading should be 5% of the net value of the asset pool.
85.I therefore conclude that if I was deciding this matter on contributions alone, it would be appropriate to attribute 55% to
[Mr Manoly] and 45% to [Ms Farley]. However, I must also consider matters under sub-section 90SF(3) of the Act.Thus, there is no merit here; a division of 55 per cent / 45 per cent as expressed in paragraph 85 follows naturally from what his Honour said in paragraph 84.
Conclusion
Having found no merit in any ground of appeal, the appeal must be dismissed.
Costs
At the conclusion of the hearing I received submissions as to costs depending on the result. If the appeal was dismissed the respondent sought an order for costs, and the appellant opposed that on the basis of her financial circumstances.
Section 117 of the Act governs the question of costs and pursuant to ss 117(2) there are circumstances here that justify an order for costs, namely, the appeal has been wholly unsuccessful. The financial circumstances of the parties, and particularly those of the appellant, do not alter that outcome. Thus, there will be an order that the appellant pay the respondent’s costs of and incidental to the appeal.
I certify that the preceding seventy-five (75) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered on
13 June 2013.
Associate:
Date: 13 June 2013
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