Fiore and Fiore and Anor

[2018] FamCA 236

FAMILY COURT OF AUSTRALIA

FIORE & FIORE AND ANOR

[2018] FamCA 236

FAMILY LAW – PROPERTY – Final orders – 10 year relationship and marriage – where the husband’s initial contribution included a real property – no evidence of the initial value of that property – where the wife was the primary homemaker and carer for the two children of the marriage – where the husband was the main income earner – where the second respondent seeks a declaration that a property registered in the husband’s name is held on trust for her – where the wife seeks the sale of that property and a payment to the second respondent – where the evidence establishes the second respondent paid for the purchase of that property – where the disputed property is found to be held by the husband on trust for the second respondent and therefore not matrimonial property – where the husband seeks that a payment be made to the wife – where the wife seeks 70 per cent of property of the marriage – where it is found that the contributions of the husband and wife are equal – where the parties agree that a 20 per cent adjustment in favour of the wife for s 75(2) factors is appropriate – declaration that the property in dispute is held on trust for the second respondent – where there should be a division of the joint non-superannuation property 70 per cent in favour of the wife and a payment made to the wife.

Evidence Act 1995 (Cth) s 128
Family Law Act 1975 (Cth) ss 75(2), 78, 79

Bevan & Bevan (2013) FLC 93-545
Bolger & Headon (2014) FLC 93-575
Coghlan & Coghlan (2005) FLC 93-220
Stanford & Stanford (2012) 247 CLR 108

FIRST APPLICANT:    Mr Fiore

FIRST RESPONDENT:	Ms Fiore
SECOND RESPONDENT:	Ms K Fiore

FILE NUMBER: MLC 4325 of 2014

DATE DELIVERED: 17 April 2018

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Thornton J

HEARING DATE: 13,14 June and 13,14,15 November 2017

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Hoult

SOLICITOR FOR THE APPLICANT: Prompt Legal Services

COUNSEL FOR THE FIRST RESPONDENT: Ms Jardine

SOLICITOR FOR THE 

FIRST RESPONDENT:

MB Law

COUNSEL FOR THE 

SECOND RESPONDENT:

Mr Tesoriero

SOLICITOR FOR SECOND RESPONDENT: Slater and Gordon Lawyers

Orders

1. The husband pay the wife the sum of $434,515 within ninety (90) days.

2. Within seven (7) days the wife remove, at her expense, any caveat she has lodged against the real properties registered in the husband’s name.

3. The husband and the wife are each declared to be solely entitled to all items of personal property and superannuation in his/her respective possession or control.

4. Pursuant to s.78 of the Family Law Act1975 (Cth) it is declared that the husband holds all of his right, title and interest, legal or otherwise, in the real property located at and known as L Street, G Town in the State of Victoria on trust for the second named respondent.

5. In the event that the husband fails to comply with Order 1 in full, both the husband and wife do all such acts and things and sign all necessary documents to list for sale for the best price reasonably obtainable the real properties located at:

   (a)N Street, G Town ...; and

   (b)M Street G Town ....

6. That the proceeds of sale of the properties listed in Order 5 above be distributed as follows:

   (a)to pay all costs, commissions and expenses of the sale;

   (b)to discharge all registered mortgages and any other registered encumbrances over any of the real estate at M Street G Town and N Street G Town;

   (c)to pay the wife the sum of $434,515 plus any interest at the rate prescribed by the Family Law Rules 2004;

   (d)to pay the wife the costs of $600 ordered on 3 June 2015 and the costs of $3,300 ordered to be paid to the wife on 14 June 2017 in the event that the costs remain unpaid; and

   (e)        any balance remaining to be retained by the husband.

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 Fiore & Fiore and Anor 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: MLC4325 of 2014

Mr Fiore

Applicant

And

Ms Fiore

First Respondent

And

Ms K Fiore

Second Respondent

REASONS FOR JUDGMENT

1. The applicant husband and first respondent wife seek orders for property settlement under Part VIII of the Family Law Act1975 (Cth) (“the Act”). There is a dispute about the property of the marriage. The second respondent is the husband’s mother who claims that a property registered in the husband’s name is held on trust for her.

2. The case was transferred to this Court from the Federal Circuit Court on 12 February 2015. 

3. The applicant husband, aged 41, is a tradesman residing in G Town and is the sole director and shareholder of S Pty Ltd (Aust) Pty Ltd (“the Company”) which trades as a business known as S Pty Ltd. The husband maintains that he is an employee of this business, and that the business belongs to his mother, the second respondent.  This is not challenged by the wife and the wife makes no claim to the business or the Company.

4. The husband resides with his new partner and their child in the former matrimonial home at M Street in G Town (“the M Street property”). The M Street property is registered in the name of the husband. The husband and wife live about 90 minutes driving distance apart.

5. The wife, aged 40, is engaged in home duties. The wife resides with the two children of the marriage, aged five and seven.  She relocated from G Town to F Town with the children in January 2015.  The wife and children live at the house of the wife’s uncle.

6. The second respondent is a retiree residing in G Town.  She lives at the property at L Street, G Town (“the L Street property”) which was purchased during the marriage and which she claims is held on trust for her because of the financial contributions she and her husband, Mr P Fiore, now deceased, have made to the property.  

7. The L Street property is registered in the name of the husband.  The second respondent built a house on the property in 2011 and she has lived at the L Street property ever since. The second respondent’s case was that the L Street property was only registered in the name of the husband because she and Mr P Fiore could not obtain finance when the property was purchased as a block of land in 2009.  It was ultimately not disputed by the husband or the wife that the second respondent has contributed approximately $400,000 to the L Street property.    

8. The proceedings were protracted because the husband failed to disclose financial matters relating to his family business.  The husband and wife also shifted their positions during the trial.  Much of the affidavit material then became irrelevant for the trial because of concessions ultimately made by the wife.

Procedural background

1. When the trial commenced in this Court on 13 June 2017, the husband and wife were in dispute about the parenting arrangements for the children and an Independent Children’s Lawyer participated in the trial. 

2. The husband and wife settled their parenting dispute on the first day of trial and final parenting orders were made by consent with the assistance of the Independent Children’s Lawyer.  Those orders amongst other things provide for the children to live with the mother and spend time with the father each alternate weekend from Friday to Monday and half of the school holidays.

3. The property proceedings were adjourned by consent on the second day of trial, being 14 June 2017, and the husband ordered to pay costs to the wife of $3,300 by consent. The property proceedings were adjourned because the husband had failed to instruct his counsel about a number of liabilities which he maintained were relevant to the trial.  The husband produced a number of documents on the second day of trial which had not been disclosed previously and which included an email from his accountant about a tax liability. As a result of the adjournment the parties filed further material.

4. The husband’s undisclosed liabilities ultimately appeared to relate to the family business which was subsequently not the focus of the trial.

5. On the resumption of the trial on 13 November 2017 and in the afternoon, being day three of the trial, the concessions made by counsel for the wife substantially changed the issues at trial.  The wife abandoned her claim that the family business formed part of the property of the marriage and she also abandoned her claim that the husband owned an expensive collection of cars which were part of the joint property pool.

6. The wife also conceded the case of the second respondent and the husband that two factories registered in the name of the husband situated at 1 and 2 Q Street, Suburb R (“the factories”) were held by the husband on trust for the second respondent and sought a declaration to that effect.  The wife also sought a declaration that the business of S Pty Ltd and the Company are held on trust for the second respondent.

The applicant husband’s application

1. Counsel for the husband ultimately made a number of concessions in closing submissions.

2. The husband sought the following orders in his Case Outline filed 9 November 2017 as amended on 14 November 2017:

   1.The Husband pay to the Wife the sum of $100,000 (“the Payment”) within 90 days of the date that the Wife removes all caveats she has lodged against all the real properties that are in the Husband’s name (“the Date”).

   2.Within 7 days the Wife remove, at her expense, all caveats she has lodged against all properties in the Husband’s name, to enable the Husband to obtain finance for the Payment.

   3.The Wife retain the contents of the real property situate at [N Street, G Town]

   4.That 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 property (including choses-in-action) in the name and / or possession of such party as at the date of these orders.

   (b)each party forego any claims they may have to any superannuation benefits belonging to or earned by the other.

   (c)insurance policies remain the sole property of the owner / beneficiaries named therein.

   (d)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.

   (e)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.

   5.In default of the parties or either of them doing all acts and things and executing all such for $55,637 effect to these Orders, a Registrar of the Family Court of Australia at Melbourne or the Registrar of the Federal Circuit Court of Australia at Melbourne be appointed pursuant to s106A of the Family Law Act 1975 (Cth) to execute all such documents in the name of the party in default and to do all such acts and things necessary to give validity and operation to the said orders.

   6.That time is of the essence in relation to these orders.

3. In closing submissions, counsel for the husband submitted that the net asset pool of the parties on the evidence in the trial amounted to $400,000.

4. Counsel for the husband conceded that the evidence was not strong regarding the credit card debt of $35,000 claimed by the husband as a joint liability and that the debt included debts for S Pty Ltd. Counsel for the husband conceded that the s 75(2) factors under the Act favoured the wife by 20 per cent. He conceded that it was open on the evidence for an order to be made by the Court for the husband to make a payment to the wife of between $200,000 and $280,000. However the husband’s counsel submitted at the end of the closing submissions that the payment should be $200,000.

5. Counsel for the husband also conceded that the husband was in arrears in child support payments to the wife in the amount of approximately $5,000.

The respondent wife’s response

1. The respondent wife substituted an amended Case Outline on 14 November 2017 after she abandoned part of her case.  The new Case Outline was confusing and was not explained any further during the trial.

2. In the amended Case Outline, the wife sought the following orders:

   1.   A Declaration that all real property held in the husband’s name forms part of the asset pool of the husband and wife.

   2.   A declaration that:

   ………………………….

   c) all of the furniture at [M Street] and [N Street, G Town] form part of the asset pool of the husband and wife;

   d) the two premises at [1 and 2 Q Street, Suburb R], be held by the husband on behalf of [Ms K Fiore];

   e) the business of [S Pty Ltd] and the company [S (Aust) Pty Ltd] is held on trust for [Ms K Fiore].

   3.   The Husband be ordered to immediately sell all assets of the husband and wife held in the name of or on trust for the husband, including real estate in the husband’s name at [M Street G Town] and [N Street G Town], and [L Street, G Town], and furniture at [M Street] and [N Street G Town] (the “Sale”),  and upon completion of the Sale the proceeds of the Sale be applied:

   a)to pay all costs, commissions and expenses of the Sale

   b)to discharge all registered mortgages and any other registered encumbrances over any of the real estate at [M Street], [L Street] and [N Street G Town]

   ……………………………….

   5.   From the asset pool of the husband and wife the following payments are to be made:

   (a)   $400,000 to be paid to [Ms K Fiore], being her equitable interest in the property at [L Street, G Town] then

   (b)  70% of the balance of the asset pool plus interest charged from the date 30 days after the date of these Orders until the date of payment, be paid to the wife then

   (c)  the husband pay to the wife the sum of $11,189.99 being outstanding legal costs ordered against the husband then

   (d)  the husband pay to the wife all outstanding child support and then

   (e)  the balance be paid to the husband.

   6.   The husband be personally responsible for all debts incurred by the husband and/or [S Pty Ltd] and/or [T Club] which are not secured on at least one of the real estate properties of [M Street], [L Street] or [N Street] [G Town]

   7.   Each party retains all superannuation in their name.

   8.   The wife retains her car and other personal effects.

   9.   The husband to pay the wife’s costs of and incidental to these proceedings on an indemnity basis.

   10. Such other order as this Honourable Court deems fit to make.

   11. All extant applications be dismissed.

The second respondent’s application

1. The second respondent amended her Response after counsel for the wife had made the concessions regarding the family business.  The second respondent orally amended her Case Outline filed 13 November 2017 to the following on 14 November 2017:

   1. Pursuant to s.78 of the Family Law Act 1975 (Cth) as amended IT IS DECLARED THAT:

   The Applicant holds all of his right, title and interest, legal or otherwise, in the real property located at and known as [L Street, G Town] in the State of Victoria (the [G Town] property) on trust for the Second-Named Respondent;

   2.   That the Applicant hereby be restrained by injunction from further encumbering or drawing down the loan secured by registered mortgage over the [G Town] property at [L Street, G Town] in the State of Victoria without first obtaining the written consent of the Second-Named Respondent.

   3.   The Applicant make all regular instalment payments as and when they become due in respect to the mortgage registered against the [G Town] property and the Applicant forever identify [sic] the Second-Named Respondent and be solely liable for the mortgage registered against the [G Town] property.

   4.   In the event that the Applicant fails to comply with Order 3, the Applicant and the First Respondent, as the case may be, shall do all things and sign all necessary documents to sell the property known as [M Street G Town] in the State of Victoria, altogether out of court and upon settlement the proceeds be distributed to firstly discharge the mortgage registered against the [G Town] property at [L Street, G Town].

Background

1. I am satisfied on the balance of probabilities of the following background facts.

2. Before he met the wife, the husband purchased the former matrimonial home being the M Street property in July 2000.  There was no evidence about what he paid for that property. The property is registered in his name. He built a new house on that property which was completed in March 2002.[1] I accept the evidence of the husband that he obtained a loan in July 2001 with the Commonwealth Bank secured on the M Street property for $215,000.[2] There was no evidence of the equity in the M Street property when the relationship commenced.

   [1] Affidavit of the husband filed 13 September 2017, Annexure TJF 8.

   [2] Affidavit of the husband filed 13 September 2017, Annexure TJF7.

3. The husband and wife began their relationship in February 2003 and commenced living together at the M Street property.  They were married in 2008 and had two children during the marriage, B born in 2010 and C born in 2013. 

4. The husband and wife separated in September 2013 and the husband left the former matrimonial home in October 2013.   The wife and children lived in the M Street property until January 2015 when she relocated with the children to F Town where she currently lives with the children in her uncle’s house.  The wife has not re-partnered.

5. The wife is aged 40 years and was employed as a factory hand when she met the husband.  She is currently the full time carer of the two children and has no income other than Centrelink payments.

6. The husband is aged 41 years and is a tradesman by occupation. The husband lives in the M Street property with his new partner and their child, born in 2015.  The husband retained the contents of the M Street property after separation.

7. When the wife met the husband he was employed in his parent’s business where he has worked since he left school.  The Company was incorporated in 2012 and the husband is the sole director and shareholder. The Company trades as S Pty Ltd and the husband continues to work in the business.

8. It is the case of the husband and the second respondent that the business is held by the husband on trust for the second respondent and that he works in the business as an employee. This was ultimately conceded by the wife.

9. The husband deposed, in his first affidavit, to “owning” the factories located at 2 Q Street, Suburb R (“Factory 1”) and 1 Q Street, Suburb R (“Factory 2”).  The husband deposed that each of these factories are worth $280,000 with $350,000 finance secured against them both, resulting in equity totalling $210,000.[3]

   [3] Affidavit of the husband filed 28 April 2018, par 87.

10. The second respondent claimed that the factories were purchased as a form of superannuation and that S Pty Ltd funded the loan repayments with the loans for the factories taken out in the husband’s name because the second respondent could not obtain finance.  The wife ultimately conceded that the factories were held on trust for the second respondent.

11. It was common ground that the wife is not responsible for the business or any debts of S Pty Ltd or the Company.  The evidence of the husband and second respondent about the history of the business and the Company was not challenged.

12. During the marriage in 2012 the husband purchased an investment property at N Street, G Town (“the N Street property”) which he registered in his name.  The property was purchased by way of a mortgage with U Finance. The husband retained the contents of the N Street property after separation.

1. The husband is the president of T Club Inc. which operates as T Club (“the Club”).  It was incorporated on 20 September 2012 under the Associations Incorporation Act1981 (Vic).  The Club holds an annual event at V Town.  The first event was held in 2015. It is not asserted by the wife that this Club has any value or forms part of the joint property pool.

2. The parties had previously been in dispute about the relocation of the children to F Town.  The husband was unsuccessful in an interim application before Bennett J in June 2015 for a court order requiring the wife to return with the children to reside in the N Street property. The husband maintains that the N Street property was vacant because of the relocation proceeding and that he suffered a loss of income from the property during that time but this was ultimately not pressed in submissions.

3. The L Street property was purchased in November 2009 for approximately $182,500 and registered in the husband’s name. A loan was taken out in the name of the husband because the second respondent and Mr P Fiore could not obtain finance. The second respondent and Mr P Fiore paid the deposit for the property. In 2010 the second respondent and Mr P Fiore sold their property in Suburb R and received $465,000 in net proceeds. The second respondent paid the husband approximately $146,000 in September 2010 to reduce the mortgage over the property.

4. A house was constructed at the L Street property and was paid for by the second respondent and Mr P Fiore. The second respondent and Mr P Fiore moved into the house in September 2011. Mr P Fiore moved into a nursing home in June 2014 on the evidence of the husband and in 2015 on the evidence of the second respondent.

5. The husband’s father, Mr P Fiore, died in 2017.

The evidence

1. The documents relied upon by the parties are listed in Annexure A to these reasons. The husband annexed a valuation for the Company by Mr W dated 23 August 2017 to his affidavit filed 13 September 2017.  This valuation   was inadmissible but he did not rely on that report.

2. Numerous written objections to evidence were made in the Case Outlines of each of the parties.  However on day one of the trial, the parties jointly proposed not to seek rulings on those objections but for the Court to attach appropriate weight to the evidence in the light of the objections.  There were ultimately no submissions made about the objections to evidence in closing submissions.

3. Each of the parties were cross-examined in the trial.  The husband relied on the evidence of his friend Mr X who was also cross-examined.  Because the wife abandoned two aspects of her case the other witnesses for the husband became irrelevant. A number of exhibits were also tendered in evidence.

4. In determining the facts, I have applied s 140 of the Evidence Act 1995 (Cth), which is the civil standard of proof. Where I have made findings, I am satisfied that the facts have been proven on the balance of probabilities.

The issues

1. The parties settled the following financial issues amended in writing on 13 November 2017 for determination in the trial:

   1.The beneficial ownership of the property that [Ms K Fiore] lives in – [L Street, G Town].  The property is in the husband’s name. The husband asserts that this property was purchased by his parents from funds received from the sale of their home;

   2.Liabilities; and

   3.Division of assets.

2. The parties also produced a written document of Issues Not in Dispute amended on 13 November 2017 as follows:

   1.That the husband owned [M Street] [property] before he met the wife.

   2.That the husband was running the business and the factory 1 [sic] before he met the wife.

   3.If it is found that the husband owns the business and the factory then these represent a significant contribution by the husband.

   4.There is no issue that the husband’s parents purchased the property at [L Street] and built a house using some of their funds from the sale of the property at [Y Street, Suburb R].

3. After settling these documents and by the afternoon of 13 November 2017, as outlined previously, it was ultimately conceded by the wife that the husband holds the factories, the business S Pty Ltd and the Company on trust for the second respondent.

4. As discussed previously, in closing submissions counsel for the husband and counsel for the wife made further concessions about the contributions of the parties to the property of the marriage and about the s 75(2) factors under the Act. They ultimately agreed in final submissions that any adjustment to take account of section 75(2) factors under the Act should favour the wife by up to 20 per cent. Counsel for the husband conceded that the husband was indebted to the wife for child support in the sum of $5,000.

5. It appeared then that the real outstanding issues for determination in the trial were the identification of the joint asset pool, joint liabilities of the husband and wife and the alteration of property interests as between the husband and wife. The additional issue was beneficial ownership of the L Street property.

The evidence of the husband

1. The affidavit evidence of the husband was unclear and at times confusing as it changed between his first affidavit filed 28 April 2016 and his second affidavit filed 13 September 2017. The husband relied on both affidavits.

2. In the husband’s first affidavit he described the assets he owned before the commencement of the relationship.  Having regard to the concessions made by the wife, the only relevant property at the commencement of the relationship deposed to by the husband is the M Street property. There was no evidence about the purchase price or value of the M Street property at the commencement of the relationship.

3. In his second affidavit the husband deposed that the settlement of the M Street property was in July 2000 and that he obtained a loan from the Commonwealth Bank in 2001. The husband annexed a copy of the Complete Home Loan schedule from the Commonwealth Bank dated 2 July 2001 which records the total amount of credit as $215,000.[4] He deposed that the home was built in 2002, before the relationship began.

   [4] Affidavit of the husband filed 13 September 2017, annexure TJF7.

4. The husband deposed that he commenced the relationship with the wife in 2003 and after they began their relationship the wife moved into the M Street property with him. He deposed that they married in 2008 and lived together at that property for approximately 10 years.  He deposed that they separated in or about September 2013.

5. The husband deposed and there was no dispute that at the commencement of the relationship the wife did not own any significant assets or have any bank savings, save for superannuation entitlements.  In his first affidavit the husband deposed that prior to the relationship he was working as a tradesman and the wife was engaged in paid employment.

6. The husband deposed relevantly that neither party had liabilities of note, save for the mortgage on the M Street property to which he contributed solely.

7. In closing submissions the current liability for the mortgage on the M Street property was ultimately agreed between the parties as a joint liability valued at $145,688.

8. The husband’s evidence about the purchase of the N Street property was unclear. In his first affidavit the husband deposed that in about 2012 he purchased the N Street property “using all of my funds which I had accumulated”[5] and that he solely contributed to the mortgage for this property. The husband later in his first affidavit denied ever discussing the purchase of the N Street property with the wife before the purchase and deposed that it was “mostly funded by refinancing the mortgage”[6] against the M Street property.

   [5] Affidavit of the husband filed 28 April 2016, par 15(d).

   [6] Affidavit of the husband filed 28 April 2016, par 78.

9. The husband deposed in his second affidavit that the balance of the mortgage with U Finance on the N Street property as at 1 June 2017 was $317,578.   This was ultimately accepted by the wife in closing submissions as a joint liability of the husband and wife valued at $317,578.

10. In his second affidavit the husband deposed that the N Street property is currently rented at $300 per week and the mortgage repayments are $485 per week. The husband deposed that during the proceedings the property was vacant for 12 months and that he met the mortgage repayments during that time of $27,160.

11. The husband deposed in his first affidavit that during the relationship he was employed fulltime through S Pty Ltd and “contributed solely to the parties’ living expenses”.[7] He further deposed to providing “monetary allowances” to the wife and assisting with general household tasks at home.

    [7] Affidavit of the husband filed 28 April 2016, par 15(e).

12. The husband reiterated in his second affidavit that he maintained the M Street property inside and outside. Further he deposed that he helped to cook meals, feed the children, change nappies and bathe the children. He also deposed to taking one of the children to swimming lessons on Sunday.

13. In his first affidavit the husband denied the wife’s affidavit evidence that he had “very little to do” with the children and rarely assisted with tasks at home. The husband went on to describe tasks he performed inside and outside the house.

14. In cross-examination during the first day of trial the husband conceded that there was an agreement between the parties that the wife would be “a stay at home Mum” and that he worked in the family business six days per week and for long hours.

15. In relation to the contributions of the wife during the relationship the husband deposed to the following in his first affidavit:

    ·    That the wife worked full time for the first three years of the relationship, but that she did not contribute significant funds to the parties’ living expenses;

    ·    That the wife received a payout of approximately $26,500 from her employer which she retained for her sole use and benefit and did not contribute any sums to the parties’ living expenses;

    ·    That the wife received Centrelink benefits following the birth of their child B;

    ·    That the wife undertook the role of home duties and looked after the children while he was at work;

    ·    That the wife assisted with general household tasks;

    ·    That the wife only made “very rare contributions to our living costs”; and

    ·    That the wife received an inheritance of approximately $20,000 which she retained for her sole use and benefit and did not contribute any sums to the parties’ living expenses.

16. In his second affidavit the husband qualified his statement about the wife’s contribution to the home duties of cooking and cleaning and stated she did not “take on this role completely and most of the time we either had takeaway food for dinner or a meal that my mother prepared for us”.[8]

    [8] Affidavit of the husband filed 13 September 2017, par 115.

17. In closing submissions, however, counsel for the husband conceded the contributions of the wife in the following submission:

    It has always been conceded…. that the mother made a significant contribution to the household, both financial and from a welfare point of view. There was no challenge to the mother at all about her parenting, her contribution or her capacity for further employment.

18. In response to the wife’s assertion that she used her inheritance of $20,000 to pay for “things for the children”, the husband deposed in his first affidavit that occasionally the wife used to “dip into” her funds to buy things for the children, but he paid her back that money in cash. He deposed that he paid for the medical expenses and the wife collected rebates in her bank account, and prior to that she collected cash rebates from Medicare.

19. In relation to the payments the wife received from Centrelink, the husband in his first affidavit conceded these amounts were paid into his bank account, but explained this was because the wife did not have a bank account for a number of years and that he would withdraw all the money received from Centrelink and give it to the wife.

20. In response to the wife’s assertion that she worked for S Pty Ltd and was not paid, the husband deposed in his first affidavit that the wife was “never formally employed by S Pty Ltd, but worked there part-time for approximately three and a half years, during which time she was paid for her work via a number of ways”.[9] Later in his first affidavit he deposed to the wife being paid for all detailing jobs she performed and receiving a new motor vehicle worth approximately $42,000, a fuel card, a fully paid mobile phone and meals while working.

    [9] Affidavit of the husband filed 28 April 2016, par 74.

21. In his first affidavit the husband admitted that after separation he did not pay child support until April 2015.

22. The husband in his first affidavit at paragraph 85(f) denied having an interest in a business with Mr X. However in his second affidavit in referring to the Club the husband referred to the Club as a business.[10] The husband in his first affidavit denied he had a business venture with Mr X and deposed that the only interest in the Club is that of a “hobby” and it is a “not-for-profit organisation”. In his second affidavit at paragraph 80 he deposed that he arranged for his friend Mr X to make repayments on the Company Z loan and the loan against the L Street property. He deposed that this amounted to $55,637. He deposed that Mr X “expects to be reimbursed once I have the finance available to do so.”  In his version of the asset pool, the husband claimed this liability to his friend Mr X as a joint liability in the sum of for $55,00.

    [10] See affidavit of the husband filed 13 September 2017 par 76.

23. The husband in his first affidavit denied hiding funds or secreting cash.

24. The husband in his second affidavit deposed that he suffers from asthma, a sore back and joints. He deposed that “due to the nature of my occupation, my health will deteriorate”. He referred to the detrimental effects of the chemicals that he handles and inhales and the noise. This was not supported by any medical evidence and was not pressed in closing submissions. As outlined earlier counsel for the husband made a concession in closing submissions that the s 75(2) factors under the Act favour the wife by 20 per cent.

25. In relation to the L Street property, in his first affidavit, which was sworn prior to the death of his father, the husband deposed that the property is his parents’ home although the mortgage is in his name. He deposed that it is “equitably wholly owned by my parents”.[11] He deposed at paragraph 115 of his first affidavit that in November 2009 he purchased the L Street property as a block of land for $182,500 and that his parents paid the deposit. He deposed that his parents could not obtain finance for the property when it was purchased and therefore the land was purchased in his name and he obtained finance.  The husband did not provide any clear evidence about any loan in his name. 

    [11] Affidavit of the husband filed 28 April 2016, par 128.

26. He deposed that in late 2010 his parents sold their unencumbered Suburb R property for $485,000 and that his parents “almost discharged the loan I took out to help them purchase” the block of land at the L Street property.  He deposed that “(h)owever it was decided to then not fully discharge that mortgage/re-draw facility in case they needed more money”.  The husband deposed that in early 2011 his parents contracted to have a dwelling built on the L Street property and stated that he did not assist in paying for the building of that home. He deposed that from “conversations I have had with my parents” they used the proceeds of sale from their property in Suburb R to build that home.  He deposed that his parents moved into the L Street property in 2011 and his mother continues to live there. He deposed that his father moved into a nursing home in June 2014.

27. He deposed that at one point the “mortgage was basically nothing” on the L Street property but that he withdrew funds with his parents’ consent to invest in Business O, which was a “very bad investment”.[12]

    [12] Affidavit of the husband filed 28 April 2016, par 87(a).

28. The husband deposed in his first affidavit that he purchased the business Business O in 2012 for $85,000 and that he had a half interest with his friend Mr BB, but that the business was solely in the name of Mr BB. In his second affidavit at paragraph 78 the husband deposed that the purchase price of his share in the Business O was $86,500. He deposed that he further utilised $18,000 of his own funds for capital investment. The husband deposed in his first affidavit that in December 2013 the business was sold for $80,000 and that all of the net proceeds, approximately $70,000 were applied to his own debts and the debts of Mr BB.  

29. In his second affidavit the husband deposed that the mortgage over the L Street property was $129,038 which is a liability with CC Bank for which he is responsible due to his borrowings on the property for him to invest in the Business O. The husband at Annexure TJF11 annexed a copy of the current mortgage liability with CC Bank. The closing balance at 19 June 2017 is $129,038.57 and the Home Loan Statement is in the husband’s name addressed to Factory 1 and Factory 2.

30. In relation to the joint loan application to the Company Z for $41,087 (Annexure MNF16 to the wife’s affidavit filed 6 April 2016) the husband deposed in his second affidavit that “we substantially inflated the values” of the factories, the M Street property, and the N Street property. Further he admitted that the value of the vehicles was inflated in the joint application. In his first affidavit the husband deposed that this debt is in the names of the husband and wife and that the loan was taken out so he could pay out debts and bills relating to Business O.[13] The husband in cross-examination sought and obtained the benefit of a s 128 Certificate under the Evidence Act 1995 (Cth) to answer questions about the loan application.

    [13] Affidavit of the husband filed 28 April 2016, par 82.

31. In response to questions about the joint personal loan application from the Company Z, the husband asserted that he lied in the application made 4 September 2013.[14] In that application the husband’s motor vehicles were listed at a value of $1.3 million and the N Street property valued at $1.9 million. He acknowledged that the loan application listed liabilities totalling $742,000.  He maintained that this was also not accurate. When asked if the personal loan application was a “complete lie” he responded “not all of it”.

    [14] Affidavit of the wife filed 6 April 2016, Annexure MNF 16.

32. In cross-examination the husband stated that he had the Business O for only 12 months until December 2013.

33. The husband’s evidence about credit card liabilities was confusing. In relation to the credit card liabilities in his first affidavit the husband deposed to one credit card liability as $22,666.58 as of 4 February 2016 and another credit card liability of $11,014.54 as of 22 February 2016. He deposed that both credit cards are in his name. In his second affidavit the husband deposed that the credit card debts were approximately $55,000 for both credit cards.

34. Ultimately after hearing all the evidence in the trial and in final submissions the husband claimed that the parties had a joint liability of $35,000 by way of  credit card debt in his version of the joint asset pool (Exhibit C3).

35. The husband deposed that he left the M Street property about three to four weeks after separation. He deposed that the wife continued to live in the M Street property with the children for about one and a half years. He deposed that he continued to pay the mortgage, rates and bills for the M Street property. He deposed at paragraph 79 that he also paid for the insurance and land tax. He deposed that he paid the water usage, water rates, house insurance, mortgage and council rates on the M Street property until late 2015.

1. The husband deposed that for the first two months following separation he provided “monetary contributions” to the wife for her “general living expenses and for her to use to look after the children”.[15] The husband deposed to this amount being approximately $300 per week for her general living expenses.

   [15] Affidavit of the husband filed 28 April 2016, par 11.

2. Further he deposed that:

   For about eight months…following our separation I paid for the phone at the [M Street property], [the wife’s] mobile phone and e-tag and the registration and insurance for [the wife’s] [4WD], and the insurance for [the wife’s] [Motor vehicle 1].[16]

   [16] Affidavit of the husband filed 28 April 2016, par 11.

3. However in his second affidavit the husband deposed that he continued to make financial contributions to the wife “for over a year”.[17] He deposed that he paid for the electricity, water, house insurance, house phone, mobile phone, health insurance, life insurance, car insurance, eTag bills and council rates which was approximately $700-$800 per quarter. This was in addition to the $300 he deposed that he provided to the wife for general living expenses for two months.

   [17] Affidavit of the husband filed 13 September 2017, par 112.

4. In cross-examination the husband ultimately conceded that he had stopped paying expenses, utilities and mortgage payments for the wife and children approximately six months after separation.

5. In the husband’s second affidavit he conceded that he owes the wife $5,000 by way of court ordered costs.

The evidence of the wife

1. The wife relied on three affidavits; the first affidavit filed 6 April 2016, a second affidavit filed 16 March 2017 and a third affidavit filed 13 October 2017.

2. The wife deposed that she commenced living with the husband in 2003, they married in 2008 and separated in September 2013.

3. Concerning assets held at the commencement of the relationship, the wife deposed that she owned a vehicle which she was paying off and she had superannuation funds.

4. The wife deposed in her first affidavit that she worked for Company DD for 11 years and when she left in 2005 she received a payout of $26,500 which she used to “purchase furniture for the family home, to pay for living expenses and some of [the] funds were used to buy a motor vehicle”.[18]  The wife deposed that from 2005 she worked for Company EE.  The wife deposed that the income she received from Company DD and Company EE during the relationship was spent on living expenses, food, entertainment and savings. She conceded that the husband would also pay for “many of our living expenses from the business account”.[19]

   [18] Affidavit of the wife filed 6 April 2016, par 35.

   [19] Affidavit of the wife filed 6 April 2016, par 37.

5. She conceded at paragraph 40 of her first affidavit that while she worked at S Pty Ltd from 2006 until 2010 and afterwards, the husband paid for the bills and mortgage from the business and “brought home cash for me to take care of the shopping and other incidental bills”.[20] She described this as continuing during the marriage, but that the husband “arbitrarily” stopped providing money to her and the children two months after separation.

   [20] Affidavit of the wife filed 6 April 2016, par 40.

6. The wife deposed in her first affidavit that after the husband’s father had a stroke, in 2006 she gave up her employment at Company EE and worked at S Pty Ltd performing office work and “any other jobs as required”.[21] She deposed that during the time she worked for S Pty Ltd she did not receive an income. She deposed:

   …I worked on [sic] the business as it was our family business and it provided the income and lifestyle that we shared. I did not think twice about working for no income as I saw the business as our future. I never thought of [S Pty Ltd] as just being [the husband’s] business, it was our livelihood.[22]

   [21] Affidavit of the wife filed 6 April 2016, par 36.

   [22] Affidavit of the wife filed 6 April 2016, par 37.

7. Later in her first affidavit she conceded that she was provided with a petrol card to pay for fuel. In her third affidavit the wife deposed to undertaking numerous jobs for the husband at S Pty Ltd. In her third affidavit the wife denied being paid for any car detailing.

8. The wife deposed that she stopped working for S Pty Ltd in April 2010 as she was suffering severe morning sickness while pregnant with the first child of the marriage and that she was not well enough to return to work during the pregnancy. She deposed that since then she has been at home full time looking after the children. She deposed that the husband had told her that he did not want her to go back to work and he wanted her to be a “stay at home mum”.

9. The wife deposed in her first affidavit that the husband rarely assisted in the general household tasks. She deposed that she performed all the homemaker duties. She deposed that the husband left for work early and would often not see the children because he was “too late coming home”. She deposed later in her first affidavit that she undertook the “bulk of general household tasks”. The wife denied the contents of paragraph 115 of the husband’s second affidavit in which he deposed that she did not take on the role of the home duties “completely”, amongst other things, and also that he bathed the children nightly and read to them and settled the children in bed. She deposed that he was rarely home to bath or read to the eldest child.  She deposed that the husband was only home on Sundays and he worked six days a week leaving early in the morning and returning at about 7:30 pm or 8:30 pm.

10. In relation to the L Street property, the wife deposed at paragraph 43 that the husband used his parent’s money to purchase the land. She deposed that his parents “then built a house using some of the funds which they had obtained from the sale of their house” in Suburb R.[23] She deposed:

    …It appears that [the husband’s] parents were refused their loan application for additional funds to build the house at the property, so [the husband] obtained the loan in his name…[24]

    [23] Affidavit of the wife filed 6 April 2016, par 43.

    [24]Affidavit of the wife filed 6 April 2016, par 43.

11. The wife deposed that she has not been provided with “any record of [the second respondent] paying any of the ongoing outgoings of this property, such as insurance or rates or repaying this loan and it appears likely that those payments have been made by…[S Pty Ltd]”.[25]

    [25] Affidavit of the wife filed 6 April 2016, par 43.

12. In cross-examination regarding the L Street property the wife conceded that the house was built with money from the second respondent and that the second respondent had always lived there.  She also conceded that the funds from the sale of the second respondent’s Suburb R property were used to purchase the L Street property.  However the wife maintained that “the costs have come out of the business to pay for the house”. It is important to note that the wife ultimately conceded that the business was effectively owned by the second respondent.

13. The wife deposed that the husband purchased the N Street property in 2012 and prior to the purchase they discussed it.  She deposed that they agreed to purchase the N Street property as an investment for the first child of the marriage and that it would be his property in the future. She deposed that they agreed to secure a loan on the M Street property to purchase the N Street property. She deposed in her first affidavit that she was not aware of what the husband has done with the rental income from the N Street property, but presumed it was used to pay off the loan.

14. Following separation, the wife deposed that she continued to live at the M Street property for two months. She deposed that the husband gave her $300 per week to support the family. She deposed that she received no income during this time save for the remainder of a maternity payment from Centrelink. She deposed that the husband continued to pay the mortgage and bills. She deposed that he stopped paying on 25 November 2013.  Presumably the wife is referring to the payment of the $300 per week ceasing in November 2013 as she later deposed that on 31 March 2014 the husband ceased paying all the outgoings of the M Street property.  She deposed that the husband cancelled electricity, all utilities, the house telephone, her mobile phone, her health insurance, the registration and insurance on the 4WD motor vehicle she drove and her etag account. She deposed that she was left with only a Motor vehicle 1 vehicle to drive. She deposed that the husband collected the 4WD in early May 2014 and gave it to his new partner. The wife deposed that she stopped using the petrol card in November 2013.

15. The wife deposed that the husband did not pay any child support until April 2015. Later in her affidavit she deposed that the husband frequently pays his child support late and that she received no child support for December 2015 until March 2016. She deposed that since separation the husband has made no contribution to any school or kindergarten fees, swimming lesson payments or payments of other activities for the children. In her third affidavit filed in October 2017 the wife deposed she has not received child support from the husband since 2016 and that she is currently owed $4,409.84 in child support. This was supported by a document annexed to her affidavit as at 13 October 2017.  Counsel for the husband later conceded in closing submissions that the husband owed the wife $5,000 in child support.

16. The wife deposed that in August 2012 her parents gifted her $20,000 and these funds were used as “extra money to pay for things for the children and to get a refund of Medicare rebates if we had doctor’s appointments”. She deposed that at the time of separation this amount was approximately $17,000 but that after separation she “lived on” the funds, in particular after the husband stopped meeting the expenses of the property in March 2014.  She deposed that it was then that she decided to move to her parents’ home in F Town. The wife denied in her third affidavit that she received other “large cash deposits” from her parents.

17. In her first affidavit the wife deposed to and annexed the joint application for a loan with Company Z (Annexure MNF 16).  She deposed that the husband completed the details in the application and set out their joint assets with the residence valued as $850,000, investment properties valued at $1,920,000, vehicles $1,300,000 and liabilities as $742,000. As discussed previously the husband gave evidence about inflating the value of the assets in relation to this application.

18. The wife deposed that she does not have ongoing financial support from her family. Whilst her family have accommodated her and the children since January 2015, she deposed that her parents are retired and they do not have “a lot of money in the bank that they could support me with”.[26]  In her third affidavit the wife deposed she now lives at her uncle’s house and she pays rates and water and that she pays school and kindergarten expenses and all costs of the children’s activities.

    [26] Affidavit of the wife filed 6 April 2016, par 71.

19. The wife deposed that she plans to study once the second child commences kindergarten and that she relies solely on Centrelink payments as her source of income.

20. In her first affidavit the wife deposed that the husband set up the Club on 20 September 2012. She annexed a copy of the certificate of incorporation.[27] She deposed that the husband is the president and his friend Mr X is the Secretary. She annexed what she deposed is a copy of the Club’s application for a bank account which lists the husband as the president and Mr X as the secretary.[28] The wife deposed that the Club holds a raffle and in 2015 the raffle prize was one of the husband’s motor vehicles, a motor vehicle 2, valued at $130,000. This was not denied in the husband’s first affidavit. In relation to this vehicle the husband deposed to the following in his second affidavit:

    I do not own this vehicle. The vehicle was offered as the first prize, of 3, in a competition run by the [club event] as part of a T Club promotion. The majority of the parts required to construct this replica car were purchased in approximately 2013, from [Company FF], at cost, as [Company FF] were joint promoters of this competition. I constructed this vehicle at [S Pty Ltd] over the course of 9 months. For the competition we received ticket payments of approximately $75,000 taking into account the cost of the vehicle build, advertising, etc. We had hoped to raise $130,000. We made a loss on this competition and vehicle but despite this, the competition raised awareness of the business and the Club.[29]

    [27] Affidavit of the wife filed 6 April 2016, Annexure MNF 38.

    [28] Affidavit of the husband filed 13 September 2017, Annexure MNF 39.

    [29] Affidavit of the husband filed 13 September 2017, par 30.

21. The husband deposed that the vehicle was never registered to S Pty Ltd.

22. In her third affidavit the wife deposed that she does not agree with the valuations for any of the real estate as the valuations were made over two and a half years ago however she deposed she is unable to afford new valuations.

23. Much of the wife’s second affidavit related to her previous case which was abandoned.

24. The wife deposed in her first affidavit that pursuant to orders made by Bennett J on 3 June 2015 the husband was ordered to pay her costs fixed at $600 and that the husband has failed to pay her this amount. In her third affidavit the wife deposed that on 21 November 2016 the husband was ordered to pay legal costs as agreed but that the husband’s “then solicitor refused to respond to a request to ascertain how much legal costs would be, so we have estimated legal costs in the amount of $4,318.36, which [the husband] has not paid”.[30] The wife deposed that on 14 June 2017 the husband was ordered to pay her legal costs of $3,300 which he has failed to pay. The husband’s counsel conceded in closing submissions that the wife’s costs had not been paid.

    [30] Affidavit of the wife filed 13 September 2017, par 17.

25. The wife deposed that she believes the husband is trying to hide funds and that he has always done “a lot of cash business and he always held large sums of cash at home during the marriage”.[31]

    [31] Affidavit of the wife filed 4 April 2016, par 72.

26. In relation to the Business O the wife deposed that the husband failed to disclose to her the sale price or what happened to the proceeds.  She deposed to bank statements from Mr BB showing periodic payments to the husband in 2013 which have not been explained.

27. The wife was not cross-examined extensively by the husband and was not cross-examined at all by the second respondent. She gave evidence that she intended to return to part-time work when her daughter is in four-year-old kindergarten.

28. Although she originally maintained that the signature on the Company Z loan from 2013 was not hers, the wife accepted that this had not been put to the husband in cross-examination and her counsel conceded that the wife could not remember whether she had signed the loan application or not.

Evidence of Ms K Fiore, the second respondent

1. The evidence of the second respondent was effectively unchallenged.  I accept her evidence in the following terms.       

2. The second respondent deposed that in October 2006 her husband, Mr P Fiore, suffered a major brain haemorrhage.

3. The second respondent deposed that in early 2009 she tried to purchase a block of land in G Town and the plan was for her and Mr P Fiore to build a house on that land. She deposed that despite owning an unencumbered property in Suburb R they were not approved for a loan to purchase land in G Town. She deposed that their financial adviser suggested the husband obtain the relevant finance for them and that the husband agreed to do so.

4. The second respondent went on to depose that in late November 2009 she purchased the block of land at L Street for about $182,500 and that she and Mr P Fiore paid the deposit of $18,250. She deposed that CC Bank approved the purchase of the L Street property but required the land to be registered in the husband’s sole name. She deposed that “it was always understood that [Mr P Fiore] and I actually owned the land and that it would be paid for from the pending sale of the Suburb R property”.[32] She deposed that she and the husband planned to transfer the land into her name and Mr P Fiore’s name but that the “costs and duties associated with that were significant, so we did not follow through on doing that”.[33]

   [32] Affidavit of the second respondent filed 13 April 2016, par 39.

   [33] Affidavit of the second respondent filed 13 April 2016, par 40.

5. The second respondent deposed that in about early September 2010, she and Mr P Fiore sold the Suburb R property for about $485,000 of which they received $465,000 in net proceeds. The second respondent annexed a contract of sale for the property however this listed the price as $480,000.[34] She deposed that in September 2010 she and Mr P Fiore paid $146,351.16 to the husband to reduce the mortgage. She annexed a copy of a bank statement detailing the withdrawal of funds she deposed were given to the husband to pay down the mortgage. The bank statements record a withdrawal of $146,356.56 on 14 September 2010. She deposed at paragraph 44 of her affidavit filed 13 April 2016, that “[The husband] and I decided to then not fully discharge the mortgage/ re-draw facility in case we needed more money for something else down the track”.

   [34] Affidavit of the second respondent filed 13 April 2016, Annexure WEF-7.

6. The second respondent deposed that the total cost of the construction was $235,000 and that the construction contract was between herself and Mr P Fiore and that the husband was not a party to the contract and did not contribute to the costs of building the house. She went on to depose that she and Mr P Fiore paid for all the construction and associated costs from the net proceeds of sale of the Suburb R property. The second respondent annexed copies of invoices received from M & J Childs Construction P/L which were addressed to “J & W FIORE”.

7. She deposed that in or about September 2011, she and Mr P Fiore moved into the L Street property where she remains living. In her affidavit filed 13 April 2016 she deposed that Mr P Fiore went into a nursing home in 2015.

8. The second respondent deposed that she and Mr P Fiore have spent the net proceeds from the sale of the Suburb R property and that she is now living on a government pension. She deposed that all of the utility bills for the water, electricity, gas and phone are in her name solely and she pays for them without the assistance of the husband. She deposed that the rates are in the husband’s name as the property is registered in his name but that she gives him money in cash to pay for the rates.

9. The second respondent deposed the following:

   Despite the [L Street] Property being in [the husband’s] name, I assert that this is my home that [my husband] and I have worked our entire lives for. [The wife] is very well aware of this.[35]

   [35] Affidavit of the second respondent filed 13 April 2016, par 56.

10. This was reiterated in her affidavit filed 13 September 2017 where the second respondent deposed that the wife is “well aware of the fact this property is and always was ‘our’ home, meaning mine and my husband’s, and that our son was there in ‘name only’ due to the problems of getting finance”.[36] She deposed that at no time during the marriage did the wife ever suggest that the husband was the true owner of the L Street property or “that, as a result, she had an interest in it”.[37]

    [36] Affidavit of the second respondent filed 13 September 2017, par 7.

    [37] Affidavit of the second respondent filed 13 September 2017, par 7.

11. In her affidavit filed 13 September 2017 the second respondent further denied that the husband owns the L Street property. Further in this affidavit the second respondent deposed that she is aware S Pty Ltd is not doing very well and as a result council rates for the L Street Property and some other expenses are still outstanding.

1. The second respondent deposed in her affidavit filed 13 April 2016 that the mortgage against L Street arose when the husband started Business O. She deposed that:

   It did not work out and [the husband] asked if he could redraw from the mortgage over my home to pay for the [business] debts. I agreed as we are the type of family that helps each other out and our word is as good as a contract. I believe that [the husband] will always do the right thing by me and pay the debt out.[38]

   [38] Affidavit of the second respondent filed 13 April 2016, par 57.

2. The second respondent deposed that Mr P Fiore died in 2017.

3. In cross-examination by counsel for the wife the second respondent agreed that the loan secured against the L Street property is in the husband’s name. 

4. The second respondent agreed that any repayments of the mortgage were not at her direction.

5. The cross examination of the second respondent was brief and she was not challenged about any other details of her evidence.

Evidence of Mr X

1. Mr X filed two affidavits, one on the 13 September 2017 and the second on the 14 September 2017.

2. Mr X deposed that he made a total of $55,637 in payments against loans in the name of the husband with Company Z and CC Bank as the husband could not service the loans. He deposed that he made the payments because of an agreement with the husband that he will pay him back in full when the husband “is back on his feet”.[39] Mr X annexed receipts from the Commonwealth Bank of Melbourne that showed payments made from Mr X investments to “[Company Z] FINANCE” and “[GG BANK] LTD HOME/BUSINESS LOANS”.

   [39] Affidavit of Mr X filed 13 September 2017, par 2.

3. Mr X deposed that he is an equal owner with the husband in the business “HH”.

4. In closing submissions, counsel for the wife conceded that Mr X had paid the sum of $55,000 for the benefit of the husband.

5. In cross-examination Mr X stated that there was “no time frame” for the repayment of the money that he had paid on behalf the husband and that the husband came to see him “with deals with cars” and asked him for a favour. He stated that he bought a few cheap cars from the husband and that he “moved them quickly”. He essentially stated that the husband buys a car in the owner’s name and “sells it on for a customer”.  Mr X stated that he made some money with the husband buying and selling cars.

6. He agreed that HH event will continue in 2018 and that the participants pay $90 per head and that about 800 people attend.  In re-examination he maintained that no profit was made from any of the events but that the second event “paid for itself” from the ticket sales.

Assessment of the parties

1. There is a clear obligation under the Rules to make a full, frank and complete disclosure of all relevant financial circumstances in a timely fashion. The need for each party to understand the financial position of the other party is at the very heart of cases concerning property. Unless each party adopts a positive approach in this regard, delays will ensue with the consequent escalation of legal and other expenses.  Some of the husband’s conduct in this regard did not reflect well on him. 

2. Counsel for the wife submitted that the husband’s credit was brought into question concerning the Company Z loan application. The husband was guarded in his evidence and sought the benefit of a s 128 Certificate under the Evidence Act 1995 (Cth) concerning his loan application to Company Z in 2013. However I note that the wife was a co-borrower for that loan.

3. The husband conceded that he had lied about his assets and liabilities in making the application for a personal loan from Company Z in September 2013 about the time of the parties’ separation.  This application however also bears the signature of the wife.

4. There was very little cross-examination of the second respondent by the wife and no cross-examination by the husband. 

5. I found the second respondent to be a credible witness.

Legal Principles

1. Section 78 of the Act provides for declaration of interests in property. It provides that in proceedings between parties to a marriage with respect to existing title or rights in respect of property, the court may declare the title or rights, if any, that a party has in respect of the property.

2. Section 79 of the Act provides for the discretionary alteration of property interests between the parties to a marriage. Under s 79(2) of the Act, an order cannot be made unless the Court is satisfied that, in all the circumstances, it is just and equitable.

3. The relevant factors under s 79(4) of the Act which must be taken into account in considering what order (if any) should be made are as follows:

   (a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and

   (b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and

   (c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and

   (d)the effect of any proposed order upon the earning capacity of either party to the marriage; and

   (e)the matters referred to in subsection 75(2) so far as they are relevant; and

   (f)any other order made under this Act affecting a party to the marriage; and

   (g)any child support under the Child Support (Assessment) Act1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.

4. In Bevan & Bevan (2013) FLC 93-545 (“Bevan”) at 87,232, the Full Court of this Court considered s 79 of the Act and set out the three fundamental propositions in relation to this section which the High Court of Australia laid down in Stanford & Stanford (2012) 247 CLR 108 (“Stanford”).  These are as follows:

   1.Determination of a just and equitable outcome of an application for property settlement begins with the identification of existing property interests (as determined by common law and equity);

   2.The discretion conferred by the statute must be exercised in accordance with legal principles and must not proceed on an assumption that the parties’ interests in the property are or should be different from those determined by common law and equity;

   3.A determination that a party has a right to a division of property fixed by reference only to the matters in s 79(4), and without separate consideration of s 79(2), would erroneously conflate what are distinct statutory requirements. (original emphasis)

5. In applying those principles, the parties’ legal and equitable interests in property must first be identified.

The Approach  

1. In Bolger & Headon (2014) FLC 93-575, the Full Court emphasised that

   
   

   s 79(4) of the Act requires a holistic assessment of the parties’ contributions. The Full Court referred to the authorities and the well-established recognition that s 79 of the Act requires the Court to exercise a wide discretion, and not perform a mathematical or accounting exercise. The Full Court cautioned against “over-zealous attention to the ascertainment of the parties’ contributions”.[40]

   [40] Bolger & Headon (2014) FLC 93-575 at 79,058, quoting Norbis & Norbis (1986) 161 CLR 513 at 524.

2. It is not possible to ascribe a mathematical value with any precision to the comparable weight of the differing contributions between the parties and this would be inconsistent with the holistic approach required by s 79 of the Act.

3. There are a number of factors to be taken into account under s 75(2) of the Act when considering what, if any, order should be made under s 79 of the Act. These factors are considered later in these reasons.

Findings about the second respondent’s case

1. The second respondent seeks to prove that the L Street property is held by the husband on trust for her.  The quantum of the mortgage liability for the L Street property was agreed by counsel for the wife in final submissions at $129,038.

The L Street property and mortgage liability

1. The L Street property is registered in the name of the husband. The wife conceded that the financial contribution made by the second respondent and Mr P Fiore to the L Street property amounts to approximately $400,000. Counsel for the wife therefore conceded that the husband holds a beneficial interest in the L Street property on trust for the second respondent at least to the extent of $400,000.

2. I am satisfied on all the evidence that the second respondent and Mr P Fiore, who is now deceased, entered into a contract of sale on 22 November 2009 for the purchase of the L Street property which was a block of land for $182,500 and that they included provision for a nominee.[41] I find that the second respondent and Mr P Fiore paid the deposit of $18,250 for the purchase of the property. 

   [41] Affidavit of the wife filed 6 April 2016, Annexure MNF 08.

3. I accept the evidence of the second respondent and the husband that his parents could not obtain a loan after trying several borrowers and that the husband made an application in his own name for a housing loan on that property.  I am satisfied that the husband made an application in his sole name for a home  loan of $146,000 on 9 February 2010 with CC Bank which was conditionally approved on 28 January 2010.

4. I find on the unchallenged evidence of the second respondent that in September 2010 the second respondent paid the husband the sum of $146,351 to reduce the mortgage taken out to purchase the land.  The source of these funds was the proceeds of sale of the second respondent’s family home in Suburb R which sold for $485,000 in September 2010.

5. I find that the second respondent and Mr P Fiore contributed $235,000 to the cost of constructing a house on that property.  I find that the second respondent and Mr P Fiore moved into that property after the house was constructed and the second respondent has lived there ever since.

6. There is no evidence that the wife has made any contribution to the purchase of the L Street property.

7. In closing submissions counsel for the wife conceded that the husband and second respondent were not challenged in cross-examination about their intentions when the L Street property was registered in the name of the husband.   I accept the evidence of the husband and the second respondent, which was unchallenged, that their intention when the property was purchased was that it was to be held on trust by the husband for the second respondent.   I accept their evidence that the L Street property was registered in the husband’s name because the second respondent could not obtain a loan and the mortgage was in his name. The evidence is that the second respondent provided all of the purchase money for that property and paid for the home to be constructed. She has always lived at the property. I am satisfied that the elements of the trust are made out on the unchallenged evidence of the husband and the second respondent as to their intentions at the time.

8. I reject the argument of counsel for the wife in closing submissions that the fact that the transfer of land for the L Street property did not disclose any trust arrangement supports the case that the property is not held on trust. 

9. I accept the submissions of counsel for the second respondent that the presumption of advancement is rebutted by the evidence of the intention of the husband and the second respondent. 

10. In these circumstances where the L Street property is registered in the husband’s name and held on trust for the second respondent I find that the L Street property is therefore not matrimonial property.  I find that the L Street property does not form part of the joint non-superannuation asset pool of the husband and wife.

11. Exhibit 8 was a copy of the last will of the husband’s father, Mr P Fiore tendered by counsel for the wife.  The will bequeathed to the husband all of the testator’s jewellery and motor vehicles and motor bikes owned by him at the time of his death.  The residue of the testator’s real and personal property was bequeathed to the second respondent. There was no evidence of any will produced for the second respondent.  Counsel for the wife relied on the fact that there is no mention of the L Street property being held on trust by the husband in that will.  I reject that argument and accept the evidence of the husband and the second respondent previously outlined.

12. Counsel for the wife submitted in closing submissions that “the reality” is that the L Street property will pass to the husband on the death of the second respondent. She submitted that “no evidence was given by the second respondent that the property should go to her daughter if she dies”.

13. As there is no evidence of the testamentary intentions of the second respondent this submission carries no weight.

14. Although the second respondent sought further orders there is insufficient evidence to make the orders she sought other than the declaration of trust.

15. There is no evidence that the husband intends to stop paying the mortgage for the L Street property or to draw down further funds on that mortgage. Any issues about the payment of the mortgage on the L Street property can be negotiated between the husband and the second respondent.  In any event it would appear that this may well be paid by the husband as part of the family business arrangement between him and the second respondent.   

16. I find that in 2012 the husband purchased a half share in a business “Business O” with Mr BB.  I find that the husband’s share of the purchase price was $86,500. I accept the husband’s evidence that he utilised funds from the mortgage on the L Street property to make that purchase.[42]

    [42] Affidavit of the husband filed 13 September 2017, par 78.

17. I accept the evidence of the husband that he utilised $18,000 of his personal funds for capital expenditure as part of the agreement with Mr BB.  The husband at paragraphs 57 and 78 of his second affidavit maintained that the CC Bank loan was a loan taken out by him and that he “drew down the mortgage” on his parents’ house.  

18. I accept on all the evidence that the husband borrowed money by way of  drawing down from the mortgage on the L Street property to pay his debts for the Business O and that he continues to pay for that mortgage.  There is no evidence that the wife knew anything about this mortgage and the evidence was unclear as to whether this mortgage is paid by the husband through the business or the husband personally. The second respondent at paragraph 44 of her affidavit filed 13 April 2016 deposed that the husband and she “then decided not to discharge the mortgage/redraw facility in case they needed more money”.  In circumstances where the financial arrangements between the husband and the second respondent appeared to be intermingled with those of the family business, and the business and the L Street property are held by the husband on trust for the second respondent, I do not accept that the mortgage liability for the L Street property is a joint liability of the husband and the wife.    

19. I find on all the evidence therefore that the L Street property is registered in the husband’s name but held on trust for the second respondent.  It is appropriate to make a declaration to that effect.  The L Street property does not form part of the joint non-superannuation asset pool of the husband and wife and the mortgage on that property is not a joint liability of the marriage.

Is it just and equitable to make an order under s 79 of the Act?

1. Both the husband and the wife are asking the Court to make orders here.  The husband seeks to retain the real properties registered in his name but proposes that he make a payment to the wife of $200,000.  The wife does not agree with the husband’s characterisation of the joint property pool and proposes that the three real properties registered in the name of the husband be sold and that, after a payment to the second respondent of $400,000, the balance of the proceeds of sale be distributed between the husband and wife on the basis of 70 per cent to the wife.

2. The husband and wife have lived together in a relationship since 2003 and married in 2008. They separated in September 2013.  The duration of the relationship is approximately 10 years during which time they had two children.  The husband and the wife have each made contributions of a different kind to the property of the marriage during the marriage and post separation. 

3. I am satisfied that it is just and equitable to make an order under s 79 of the Act.

Identification of property interests, liabilities and superannuation of the husband and wife

Assets

1. The husband and wife were requested since the beginning of the trial to settle a single balance sheet setting out the asset pool of the parties and disclosing the disputed property.  

2. The valuation and identification of the non-superannuation and superannuation assets together with liabilities were initially set out by the husband and wife in a table at the beginning of the trial on 14 June 2017 as Exhibit C1. In that table the husband and wife agreed the valuation of the real properties, but the only property valuations were quite stale.  This table was abandoned by the parties when the case was adjourned part-heard.

3. On the resumption of the trial on 13 November the wife no longer accepted the valuations of the real properties and purported to rely upon “drive by valuations”.  The only evidence in the trial were the valuations which had been obtained at a very early stage and no updated valuations were ever obtained. The valuations are confusing for the M Street property. The husband annexed an “appraisal” to his first affidavit at JTF-6 which was from January 2015.  This document provided a range between $720,000- $780,000 and the parties agreed in June 2017 to a valuation of $750,000.  The wife’s affidavit filed 6 April 2016 at annexure MNF 05 dated 30 December 2014 valued the property at $745,000.

4. The valuation for the N Street property was annexed to the wife’s affidavit of 6 April 2016 at annexure MNF 14 and that property was valued at $350,000 in January 2015.

5. On 13 November 2017 the husband and the wife were reminded again about the request to produce a single balance sheet setting out the asset pool and liabilities in dispute.

6. The wife subsequently abandoned her case that the Company or S Pty Ltd should be regarded as part of the joint property pool. As discussed previously counsel for the wife filed a Case Outline on 14 November 2017 which she substituted for the original Case Outline.  Counsel for the wife amended the final orders sought in the Case Outline filed 14 November 2017, but the wife’s List of Assets and Liabilities contained in her original Case Outline was never amended when she also abandoned her case that the husband owned an expensive collection of cars.

7. On 14 November 2017 counsel for the husband produced a table which purported to clarify the differences between the parties. This table was disputed by counsel for the wife but counsel for the wife did not produce a new table to reflect her case.  This table was identified in the trial as Exhibit C2.   The differences between the husband and the wife seemed to be reflected in this table but the wife did not accept the liabilities. 

1. That table in Exhibit C2 was as follows:

   Husband version of the Asset Pool

   14 November 2017

ASSET	Husband	Wife	ISSUE
M Street, G Town ...	E $750,000	$830,000	Valuation agreed in June 2017 and now challenged by wife
Real property situate at N Street, G Town, Victoria (“the unit”)	E $350,000	$400,000	As above
L Street, G Town	$595,000	$685,000	As above
$1,695,000	$1,915,00

LIABILITY	Husband	Wife	Issue
U Finance Mortgage over the Former Matrimonial Home	$145,688.00	$145,688.00	Agreed
U Finance Mortgage over the [N Street property]	$317,578.00	$317,578.00	Agreed
Company Z Loan	$16,000	Disputed
Credit card	$35,000	Disputed
CC Bank Loan	$129,038	$129,038	Agreed
Total Liabilities As agreed	$643,304	$592,304
Net assets	$1,051,696	$1,323,000

SUPERANNUATION As agreed	VALUE
Superannuation entitlements (Husband’s name)	E $8,000
Superannuation entitlements (Wife’s name)	E $48,000

ISSUE IN DISPUTE

LIABILITY	VALUE
Husband asserts money owed to Mr X	E $119,847

1. This table was amended in final submissions and produced as the husband’s version of the asset pool. After the cross-examination of Mr X and in final submissions counsel for the husband conceded that the evidence in the trial did not support a liability of the husband to Mr X in excess of $55,000.

2. The table in Exhibit C2 became Exhibit C3 in final submissions. No further table was produced by the wife after she changed her case.

3. Exhibit C3 was tendered on the final day of trial on 15 November 2017 and is as follows:

Husband version of the Asset Pool

14 November 2017

ASSET	Husband
M Street, G Town ...	E $750,000
Real property situate at N Street, G Town, Victoria [N Street property]	E $350,000
TOTAL ASSETS	$1,100,000

LIABILITY	Husband
U Finance Mortgage over the Former Matrimonial Home	$145,688
U Finance Mortgage over the [N Street property]	$317,578
CC Bank Loan	$129,038
Company Z	$16,000
Credit cards	$35,000
Mr X	$55,000
TOTAL LIABILITIES	$698,304
NETT ASSETS	$401,696

SUPERANNUATION As agreed	VALUE
Superannuation entitlements (Husband’s name)	E $8,000
Superannuation entitlements (Wife’s name)	E $48,000

1. The husband and wife agreed that each should retain their respective superannuation entitlements.  Both parties appeared to assume that the superannuation should be treated separately and this was not specifically addressed in final submissions.

2. I have adopted the approach referred to in Coghlan & Coghlan (2005) FLC 93-220 and treated the superannuation entitlements separately from the non-superannuation assets of the parties. Different considerations apply to the assessment of the respective contributions to the non-superannuation assets and superannuation benefits.

Findings about the property of the husband and wife

1. Ultimately the evidence in the trial was not focussed on S Pty Ltd or the value of motor vehicles in the possession or otherwise of the husband.  These issues were not pursued in the trial. The parties agreed that the Company and the business of S Pty Ltd is not property of the marriage.

2. The wife conceded the joint case of the husband and second respondent that the factories, the Company and the business S Pty Ltd are held on trust for the second respondent by the husband however she sought a declaration to that effect.

3. The husband proposes to continue to operate the business S Pty Ltd.  The husband is the sole director and shareholder of the Company but the evidence concerning what arrangements if any existed between the husband and second respondent concerning the ownership of the factories does not allow me to make any finding about the nature of the relationship between the second respondent and the husband or the ownership of the business as between them.  There is also no evidence of the wife being involved with S Pty Ltd by way of any guarantees.

4. On all the evidence I find that the husband has worked in the business since he left school and that the business S Pty Ltd was established by his parents. 

5. The wife sought a declaration that she is not responsible for the debts of S Pty Ltd but it is unnecessary to make such an order because the wife has no legal liability for S Pty Ltd as she is not a director or shareholder of the Company and there is no evidence that she is a guarantor.

6. The wife’s evidence of “drive by” valuations cannot be accepted.  The husband and wife agreed to the valuations of the real property at the outset of the trial as previously outlined. The husband was not cross-examined about why further valuations were not obtained.  The trial was adjourned part-heard because of the non-disclosure by the husband of liabilities of the business.  In the absence of any other evidence I am satisfied that the value of the real properties is approximately as follows:

   13   M Street, G Town           E$750,000

   N Street , G Town      E$350,000

Joint non-superannuation assets of the husband and wife

1. I find that the real property of the husband and wife comprises the M Street property valued at approximately $750,000 and the N Street property valued at approximately $350,000.  Both properties are registered in the husband’s name. 

2. There was no dispute about the value of the superannuation entitlement of each party or that each party should retain their superannuation entitlement.  The husband has a superannuation entitlement of $8,000 and the wife’s superannuation entitlement is $48,000.

3. The wife in her List of Assets and Liabilities in her Case Outline filed 14 November 2017 appeared to accept the husband’s valuation in his initial Financial Statement of $50,000 for the furniture at the M Street property.

4. The wife in her Case Outline filed 14 November 2017 originally sought that the furniture form part of the asset pool of the parties and that it be sold but after changing her case ultimately did not press or make any submissions about the furniture.

5. Counsel for the wife appeared to suggest that the value of the furniture set out in the Company Z loan application should be accepted as the value of that property, although this was not specifically submitted. 

6. The husband was cross-examined at length by counsel for the wife about the valuations that he ascribed to the contents of the M Street property in the Company Z loan application.  The husband stated that he guessed the value of the contents of the home.  The contents value is $100,000 on the loan application but the husband’s evidence was that he lied about many things and inflated the value of the assets in that joint loan application.  This estimate cannot be accepted as the value of the contents.

7. I cannot make any finding as to the value of the furniture retained by the husband from both properties. However I have taken into account that there would be some value in the contents of both properties.

8. Accordingly I also find that the furniture and contents of the M Street property and the N Street property at separation is joint property of the husband and the wife.  However I can ascribe no value to that property. Accordingly I find that the total non-superannuation assets of the parties amount to approximately $1,100,000. 

Contributions

1. As to the contributions of the husband and wife to the property of the marriage, I find that the husband purchased the M Street property for an unknown value and built a house which was completed in March 2002 before the parties met.  The husband borrowed $215,000 from the Commonwealth Bank in 2001 secured over that property.   This house subsequently became the family home. Whilst the M Street property might be regarded as an initial financial contribution made by the husband, there is no evidence that the husband had any equity in that property when the relationship commenced.

2. The husband was working in the family business when he met the wife. I find that the husband was the primary breadwinner for the family and that his financial contribution was substantial having regard to his long working hours. I am satisfied on the evidence of the wife, conceded by the husband, that the husband generally worked six days a week leaving early in the morning and returning at about 7:30 pm or 8:30 pm.

3. The wife conceded that the husband made some non-financial contributions by mowing lawns on Sunday and spending time with the family. I find that the husband also made a non-financial contribution in maintaining the home and assisting with the care of the children when he was not working.

4. I find on the evidence of the wife which was conceded by the husband that the wife made a financial contribution by way of her income from her employment with Company DD until 2005 and Company EE between 2005 and 2006.  I also find that the wife made a financial contribution of $26,500 which she received when she left Company DD in 2005.  I find that she used those funds to purchase furniture for the family home and to pay living expenses and to purchase a motor vehicle.  I also find that the wife made a financial contribution when she received approximately $20,000 from her parents just prior to separation which she used to pay living expenses for her and the children.

5. I find that the wife made a contribution by working for S Pty Ltd from 2006 until she became ill due to her pregnancy in April 2010.  I accept the evidence of the wife and find that when she worked there she worked five days a week from 9:30am until 5:00pm  in that business performing office work, car detailing and any other jobs as required.  I find that the wife was provided with a petrol card to pay for fuel for the family car from the business.

6. I find that since the birth of the eldest child that the wife made a non-financial contribution as the primary carer of the children and in the role of homemaker.  I find that the wife remained the full-time carer and homemaker by agreement with the husband and that she undertook all the general household tasks at home having regard to the husband’s hours of work.  This allowed the husband to concentrate his efforts on the business full time and to make a significant financial contribution for the benefit of the family. 

7. I find that the husband continued to pay the mortgage repayments on the M Street property and the N Street property after separation together with land tax and utilities which is a post separation contribution. 

8. I find on the evidence of the wife that post separation the husband continued to support the family for a period of approximately two months by paying the wife the sum of $300 per week and continuing to pay the mortgage and utilities for six months.  However I find that the husband ceased providing financial support to the family on 31 March 2014 and until he was assessed to pay child support.

The joint liabilities of the husband and wife

1. In closing submissions counsel for the wife conceded the quantum of the joint liabilities of the husband and wife by way of the mortgages on the M Street property and the N Street property. This was set out in Exhibit C3.  I find that the U Finance mortgage secured by the M Street property amounts to approximately $145,688 and that the U Finance mortgage secured over the N Street property amounts to approximately $317,578 and that these are joint liabilities.

The Company Z Loan

1. I am satisfied that the husband made an application for a joint personal loan in the sum of $41,088 on 4 September 2013 to Company Z and that the wife was named as a co-borrower.   The wife refers to this loan at paragraph 50 of her affidavit filed 6 April 2016.  Annexure MNF 16 of the wife’s affidavit filed 6 April 2016 is a copy of that loan application which bears the signatures of both the husband and the wife.  I find that the wife was a co-borrower and that she signed the application with the husband on 6 September 2013.  The husband was not challenged about this and counsel for the wife conceded at the conclusion of the trial that although the wife did not remember signing the loan application that the application bears her signature and that the wife was named as co-borrower on the application.

2. The husband maintained in cross-examination and I accept that this loan was to pay a debt for his venture at the Business O which was unsuccessful.  The husband also referred to this loan in his affidavit material and at paragraph 82 of his first affidavit he deposed that the loan was taken out “to pay debts and bills relating to Business O”. The husband conceded that he exaggerated the figures in the document and that he lied about the extent of his liabilities which were more than what was stated in the application.

3. The amount outstanding on that loan is now $16,000. I find that the Company Z loan is a joint loan of the husband and the wife which amounts to approximately $16,000.  This is because the proceeds of the loan were used to pay for the Business O business which was purchased during the marriage and the wife was a co-borrower. 

The husband’s credit card liability

1. The husband claimed a credit card liability of $35,000 as a joint liability but on all the evidence I am not satisfied that this is a joint liability of the husband and the wife.  Counsel for the husband conceded that the evidence in support of this contention was weak and I accept the submission made on behalf of the wife that there is no evidence that the liability was incurred by the wife.  I do not accept the husband’s claim that the credit card liability of $35,000 is a joint liability.

The alleged liability to Mr X

1. Counsel for the wife spent a great deal of time during the trial focussing on the husband’s involvement with the Club without any real explanation of the relevance of this evidence.  It appeared to relate to the contested liability originally claimed by the husband to Mr X which was ultimately amended to the reduced amount of $55,000.  In closing submissions counsel for the wife conceded that the husband owed Mr X $55,000 but did not concede that it was a joint liability of the parties.

2. The wife did not claim that there was any value in the Club.  The wife’s case regarding the Club remained unclear to me despite directing questions to counsel for the wife for an explanation.  In closing submissions counsel for the wife submitted that Mr X was a credible witness, but maintained that the husband had not disclosed the true nature of the business or the way he is deriving income suggesting that the husband has another income selling cars with Mr X.

3. Regarding the husband’s claim to a joint liability of $55,000 to Mr X, I am not satisfied on all the evidence that this is a joint liability of the husband and the wife.

4. Because of the lack of clarity around the wife’s case I make findings about the Club in explanation of the evidence.  I find that the husband is the president of the Club which was incorporated on 20 September 2012 under the Associations Incorporation Act 1981 (Vic).[43]  I find that the husband’s friend Mr X is the secretary of the Club.[44] I find that the Club has organised the HH annual event V Town since 2015.

   [43] Affidavit of the wife filed 6 April 2016, Annexure MNF 38 and Annexure MNF 39.

   [44] Affidavit of the wife filed 6 April 2016, Annexure MNF 39.

5. I find on the evidence of Mr X that he began the Club as a business with the husband with the intention of making a profit but that at this stage there has not been any profit made.  On the evidence of Mr X there is a commitment to continue to hold the annual HH event at V Town into 2018. 

6. There is no evidence that the Club has any value.

7. I find on the evidence of the husband that he built a car which was offered as first prize in a competition organised by the Club at HH event in 2015.  I find that the Club continued to raffle cars at the annual event until 2017.  After the 2015 HH event, I find on the evidence of Mr X, that Mr X contributed the prizes for those raffles.

8. I accept the evidence of Mr X that, as a friend of the husband, he has paid $55,000 on behalf of the husband when the husband could not make some of the repayments for the joint Company Z loan and the CC Bank loan on the L Street property post separation. 

9. On the evidence of Mr X both he and the husband are involved in buying, improving and selling cars both as business associates and friends and there is a very loose arrangement whereby they help each other financially.  There was no evidence of any demand made by Mr X for repayment of the money he gave the husband to meet the repayments on the Company Z loan or the CC Bank loan and on his evidence there is a continuing business relationship and friendship where they have confidence in each other and payments are made and favours exchanged. Although the husband denied ever giving any money to Mr X, I am not satisfied that the evidence supports the claim that the $55,000 paid on behalf of the husband by Mr X was a loan rather than part of a business arrangement and accordingly I am not satisfied that it should be taken into account as a joint liability of the husband and wife. 

10. As outlined previously the mortgage on the L Street property is not a joint liability.  Accordingly on all the evidence I find that the joint liabilities of the parties total approximately $479,266, comprising the Company Z loan of approximately $16,000, the mortgage of $145,688 for the M Street property and the mortgage of $317,578 for the N Street property. 

11. I find therefore that the net non-superannuation matrimonial property is approximately $620,734.

12. I also find on all the evidence that the husband is in arrears in the payment of child support in the sum of approximately $5,000 which was conceded by his counsel in closing addresses. The husband has failed to pay costs to the wife ordered by Bennett J in the sum of $600 and costs ordered in the sum of $3,300 by way of consent orders made on 14 June 2017. I find that the husband is currently not paying child support.

13. Counsel for the wife submitted that because of this history that in the event that the husband cannot pay any sum ordered to be paid by way of adjustment to the wife that the husband’s real properties must be sold.  Counsel for the husband conceded this in closing submissions.

14. I find that the wife as the full time carer of the children was not in a position to improve her education or income earning capacity but that based on the exhibits tendered in evidence on her behalf she has made efforts in that direction.

Findings as to identification of ownership and value of existing non-superannuation assets liabilities and superannuation of the husband and wife

1. The matrimonial property and liabilities of the husband and wife and the respective approximate values I have found are detailed in the following table of assets and liabilities:

   OWNERSHIP  ASSETS  VALUE

   HusbandM Street, G Town    $750,000

   HusbandN Street, G Town   $350,000

Total joint non-superannuation assets   $1,100,000

LIABILITIES

HusbandU Finance Mortgage M Street, G Town        $145,688

Husband         U Finance Mortgage N Street, G Town  $317,578

Joint           Company Z Loan  $16,000

Total joint liabilities  $479,266

Net joint non-superannuation assets  $620,734

Superannuation

Husband’s entitlement    $8,000

Wife’s entitlement              $48,000

Conclusion as to assessment and quantification of s 79(4)(d)-(g) factors

1. The husband and wife were living together in a relationship for approximately ten years having been married for approximately five years.  The husband owned the M Street property when he met the wife but the evidence is unclear as to the equity in that property when they met.  The wife had no real property or other assets of significance, save for some superannuation, at the commencement of the relationship.

2. The parties have each made different contributions to the property of the marriage and the welfare of the family during the marriage and post-separation as previously outlined in my findings.  I have concluded that the contributions made by each of the parties overall are equal. 

Findings about relevant s 75(2) factors under s 79(4)(e) of the Act

1. The wife and children now live at her uncle’s home and the wife pays for rates, water utilities, school and kindergarten expenses and all costs of the children’s extracurricular activities. She has received no child support from the husband since December 2016 and counsel for the husband conceded that the child support is in arrears in the sum of $5,000.

2. The husband is aged 41 and the wife is aged 40 and both are in reasonable health.  The husband suggested that his health may deteriorate but there was no medical evidence to support his claim that he suffers from back and joint problems.

3. I accept the evidence of the wife that her weekly income is $633.85, and her weekly expenditure is a total of $787.50.[45]

   [45] Financial Statement of the wife filed 24 March 2018.

4. The wife has no income other than Centrelink payments and the husband deposed in his latest Financial Statement to receiving income estimated at $798 per week.  He deposed to expenditure of $2,652 per week.  The husband’s income was not clear on all the evidence and it would appear on the evidence of Mr X that the husband is engaged in other business unrelated to S Pty Ltd.

5. The husband has the capacity to continue to work in the S Pty Ltd business and to earn an income.

6. Taking into account the small asset pool of the husband and wife, the disparity of income earning capacity which favours the husband, the wife’s financial support of the children post separation and the fact that the wife has been the primary carer of the children post separation, I am satisfied that a 20 per cent adjustment should be made in favour of the wife for the relevant factors under s 75(2) of the Act outlined above. This was proposed by the wife and conceded by counsel for the husband in closing submissions as open on the evidence.

7. Accordingly taking into account that the contributions of the parties to the property of the marriage are equal this would provide for a settlement to the wife of 70 per cent of the net non-superannuation assets and for the husband to receive 30 per cent of the net non-superannuation assets. 

8. I have taken into account the superannuation of the parties separately and consider that the proposals of the parties for each party to retain their superannuation entitlement is appropriate and just and equitable having regard to the husband’s greater potential earning capacity and the wife’s role as primary carer.

Conclusion

1. I have found that the L Street property is held by the husband on trust for the second respondent and that it does not form part of the matrimonial property.  The liability for the mortgage on that property is not a joint liability of the marriage.  There is insufficient evidence about the relationship between the Company, the business, the husband and the second respondent and the liability for that mortgage to make the order sought by the second respondent for the payment of that mortgage or the order sought by the second respondent that the husband be restrained from further encumbering or drawing down the loan secured by the registered mortgage on the L Street property.

2. It is important to stand back after making my findings and consider the practical outcome for the husband and the wife.  No submissions were made about the furniture or any personal assets of the husband and wife other than those outlined in the balance sheet Exhibit C2.  The husband did not challenge the wife’s evidence that he retained the contents of the former matrimonial home and the N Street property and I have taken this into account. 

3. It was agreed between the husband and wife that each should retain the vehicle which they drive. 

4. I have not included the value of the contents of the M Street property or the contents of the N Street property or the value of the motor vehicle which each party drives in the asset pool as this was not ultimately sought by the husband or the wife.

5. The wife sought that the contents of the M Street property and the N Street property be sold and the husband maintained that the value of the contents of the M Street property was approximately $50,000 in his initial Financial Statement which was accepted by the wife in her List of Assets and Liabilities contained in her Case Outline filed 14 November 2017. I consider it just and equitable for the husband to retain the contents of the M Street property and the N Street property without ascribing a particular value to that property given there is no admissible evidence as to the value.  The husband may choose to sell the contents of those properties if the properties are to be sold to meet the payment to the wife.

6. As discussed above, I find that the total joint non-superannuation asset pool of the husband and wife is approximately $1,100,000.  I find that the joint liabilities are approximately $479,266.  Accordingly I find that the total joint net non-superannuation assets of the husband and wife are approximately $620,734.

7. As discussed above I am satisfied on all the evidence, taking into account the contributions of the parties and the factors under s 75(2) of the Act, that it is just and equitable to make a distribution of net non-superannuation assets of 70 per cent in favour of the wife.

8. I am satisfied therefore that it is just and equitable for the husband to pay the wife $434,514 from the joint net non-superannuation asset pool of $620,734.  This would leave the husband with 30 per cent of the joint net non-superannuation assets being $186,220 and the contents of the former matrimonial home and the N Street property.

9. The parties made no submissions about the superannuation.  By agreement the wife is to retain her superannuation entitlement of $48,000 and the husband is to retain his superannuation entitlement of $8,000.  The superannuation has been treated as a separate joint property pool and I have taken into account the disparity between the entitlements.  

10. The husband will continue to receive income from his work in the business which he holds on trust for the second respondent.  The wife has the full time care of the children and the husband is owing child support to the wife which will be enforced through the Child Support Agency. 

I certify that the preceding two hundred and forty-nine (249) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Thornton delivered on 17 April 2018.

Associate:

Date:  17 April 2018

Annexure A

The applicant husband relied upon the following documents:

• Amended Initiating Application filed 12 October 2015;

• Affidavit of the husband filed 28 April 2016;

• Affidavit of the husband filed 13 September 2017;

• Financial Statement of husband filed 9 November 2017;

• Affidavit of Mr X filed 13 September 2017;

• Affidavit of Mr X filed 14 September 2017.

The respondent wife relied upon the following documents:

• Amended Response to Initiating Application filed 5 April 2016;

• Affidavit of the wife filed 6 April 2016;

• Affidavit of wife filed 16 March 2017;

• Financial statement of wife filed 24 March 2017;

• Affidavit of wife filed 13 October 2017.

The second respondent relied upon the following documents:

• Response to Amended Initiating Application filed 26 October 2015;

• Affidavit of the second respondent filed 13 April 2016;

• Affidavit of second respondent filed 13 September 2017.