FONDA & COLTON

FAMILY COURT OF AUSTRALIA

FONDA & COLTON

[2020] FamCA 1085

FAMILY LAW – PROPERTY – Application by husband for a property settlement – Valuation of husband’s business – Superannuation – Waste – Add-backs – Short marriage – No children of the marriage – Parties’ contributions during the course of their relationship assessed as equal – No adjustments made – Orders that the parties be declared the owners of the property in their respective names, possession or control – Order that Registry Manager refer the matter to the Commissioner of the Australian Taxation Office for consideration as to whether any laws of Australia have been broken - Application otherwise dismissed

Family Law Act 1975 (Cth) ss 75(2) and 79

Stanford & Stanford (2012) 247 CLR 108

APPLICANT:

Mr Fonda

RESPONDENT:

Ms Colton

FILE NUMBER:

SYC

8422

2016

DATE DELIVERED:

4 December 2020

PLACE DELIVERED:

Launceston

PLACE HEARD:

Sydney

JUDGMENT OF:

Benjamin J

HEARING DATE:

24, 25 & 26 August and 7 September 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Ms Dart

SOLICITOR FOR THE APPLICANT:

Mr Doumanis
Diamond Conway Lawyers

COUNSEL FOR THE RESPONDENT:

Mr Grew

SOLICITOR FOR THE RESPONDENT:

Mr Goktepe
Coleman Greig Lawyers

Orders

BY DETERMINATION and by no later than 3.00pm Wednesday, 16 December 2020 Mr Fonda (‘the husband’) and Ms Colton (‘the wife’) do all acts and sign all documents to cause the proceeds from the sale of the B Street, Suburb C, D City, E State, USA property (‘the D City property’) totalling about $507,563.95 to be paid as follows:-
(a)as to one half to the wife via her solicitor’s trust account, Coleman Greig Trust Account, L Bank Bank, CG Solicitors Pty Ltd Law Practice Trust Account, BSB …, Account No. …13; and
(b)as to the other half to the husband.
BY CONSENT as against the husband:-
(a)the wife be declared the sole beneficial owner of the furniture and effects from the D City property held in storage; and
(b)the wife be declared the sole beneficial owner of the furniture and effects as are in the wife’s possession from the parties’ former home at S Street, Suburb J.
BY DETERMINATION the wife shall be liable for any presently unpaid storage fees and for any ongoing storage fees in respect of such furniture and effects, and the wife shall indemnify the husband in that respect, and BY CONSENT IT IS NOTED:-
(a)that the Husband has caused to be paid for the costs for the storage of the chattels from the D City property until 4 January 2021; and
(b)that the Husband has provided relevant documents to the Wife for her to transfer the ownership of the chattels of the D City property (and storage of those chattels) under cover of correspondence of 7 October 2020.
BY CONSENT and subject to the above Orders, the husband and the wife, as between each other, be declared the sole owner in all equity of any property in their respective names, possession and/or control, including superannuation entitlements, interests in their respective businesses and personal effects.
BY DETERMINATION the Sydney Manager Court Services or a Registrar of the Family Court of Australia shall refer to the below named Commissioner of Taxation, for consideration as to whether any of the laws of Australia have been broken, copies of the following documents:-
(a)this order;
(b)these Reasons upon which these orders are based;
(c)Trial Exhibit E8 being the credit card statements and schedule with regard to NN Bank;
(d)the husband’s Amended Case Outline document – Exhibit E1;
(e)the husband’s Trial Affidavit filed 10 August 2020;
(f)the husband’s Financial Statement filed 10 August 2020;
(g)the wife’s Case Outline – Exhibit E2;
(h)the wife’s Financial Statement filed 11 August 2020; and
(i)the wife’s Trial Affidavit filed 11 August.
For the purposes of order 5 herein the named Commissioner of Taxation is

Mr Chris Jordan AO, Australian Taxation Office, Locked Bag 6050 Dandenong VIC 3175 or his/her delegate.
The Commissioner of Taxation or his nominated delegate/s shall have photocopy access to all documents filed and/or in relation to these proceedings and leave is granted for the Commissioner and their delegate/s to obtain copies of transcripts of evidence given in these proceedings (at their own expense) for use in relation to any investigations pursuant to this referral.
The property proceedings between the parties are otherwise dismissed.
All extant applications be dismissed and BY CONSENT the application in a case filed by the husband on 11 December 2020 be withdrawn and dismissed and there be no order as to costs in respect of the husband’s said application in a case.
BY CONSENT each party pay their own costs of and incidental to these proceedings.
All subpoenaed documents be returned to the persons or institutions from which they emanated and all exhibits are returned to the person or persons who tendered the same after the expiry of six months from the latter of the date of these orders or the determination of any appeal from these orders.

IT IS NOTED

The costs of both the husband and the wife in respect of the sale of the D City property, including the proceedings in the Superior Court of E State, have been considered in the scope of this determination and that it is not open or available for either party to include such costs and expenses in any costs application pursuant to these Reasons.

IT IS CERTIFIED

Pursuant to Rule 19.50 of the Family Law Rules 2004 (Cth) it was reasonable to engage counsel to attend.

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 Fonda & Colton 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).

CORRIGENDUM

FAMILY COURT OF AUSTRALIA AT LAUNCESTON

FILE NUMBER: SYC 8422/2016

Mr Fonda

Applicant

And

Ms Colton

Respondent

JUDGE: Benjamin J

DATE OF JUDGMENT: 4 December 2020

WHERE MADE: Launceston

CORRIGENDUM: 17 December 2020

On 4 December 2020 this Court delivered Reasons for Judgment (‘the Reasons’) in these proceedings and set out the form of the orders the Court intended to make.
At the same time the Court caused an email to be sent to each of the parties in the following form:-
Please note formal orders will not be made until 11 December 2020. Should the parties with to make submissions as to any mechanical or arithmetical issues that generally arise under the Slip Rule please do so by COB (close of business) Thursday 10 December 2020. Please ensure that the other party is copied in on any such submissions.
By email received 10 December 2020 the solicitors for the wife made submissions.
On the same day the solicitors for the husband sent a letter to the Court saying the following:-
We refer to the Judgment of His Honour Justice Benjamin delivered on 4 December 2020. We note the Written Submissions by the Respondent through her lawyers seeking what appear to be amendments in the guise of mechanical adjustments to the Orders made by His Honour. We oppose the amendments sought by the Respondent and seek leave to further address the proposed amendments should leave be granted to our client to reopen for the reason set out below.
It has been brought to our client's attention in the last few days that the Respondent through Mr F of G Real Estate Agency has listed for sale property known as H Street, Suburb J for between $1,900,000 to $2 million, an interest that the Respondent did not disclose prior to or during the hearing before His Honour.
In the circumstances we are instructed to file an Application in a Case for leave to reopen and respectfully request that time to file the Application be extended to Thursday, 17 December 2020.
On 11 December 2020 the husband’s solicitors sent a further submission setting out:-
In respect of the Slip Rule in the above matter, we note that paragraph 115 has a typographical error as it refers to the husband having a number of law firms acting for him in previous proceedings. Diamond Conway was the only firm acting for the husband throughout these proceedings. It was the wife who since commenced proceedings had changed some six different lawyers …
The letter went on to say that they were preparing to file an application and affidavit in support of leave to re-open the hearing.
On Friday 11 December 2020 I caused an email to be sent to the solicitors for the husband and the solicitors for the wife in the following terms:-
Good morning,
His Honour has read the submissions on behalf of the wife forwarded by email on 10 December 2020, the email letter from Diamond Conway of the same date and a further email from Diamond Conway dated 11 December 2020.
On 4 December 2020 His Honour published reasons in the property proceedings and indicated the orders he proposed to make today.
His Honour invited submissions as to mechanical matters in the orders which would be consistent with applications under the Slip Rule.
In terms of the substantive property proceedings His Honour is functus officio. As such His Honour says that it is not open to him to entertain or grant an application to re-open the proceedings.
As to the submissions made on behalf of the wife regarding the mechanics of the orders, His Honour directs the solicitors for the husband to provide any submissions in reply by 12 noon Wednesday 16 December 2020.
On 11 December 2020 the husband filed an Application in a case seeking leave to re-open and adduce further evidence. That application was supported by an affidavit by the husband’s solicitor Mr Doumanis.
On 14 December 2020 the Court received a letter from the wife’s solicitors signed by them and the solicitor for the husband indicating that they had reached agreement with regard to the mechanisms for the Orders proposed 4 December 2020. They attached a minute of Order to that effect. That minute of Order provided the following:-
(a)a date for distribution of the proceeds of sale of the D City property;
(b)a reduction of the amount held in the bank being the balance of the proceeds of sale of the D City property from $510,321 to $507,563.95;
(c)that the wife’s share was to be paid to her solicitors, Coleman Greig;
(d)by agreement the parties asked for orders to be made to dismiss the husband’s application in a case filed 11 December 2020;
(e)the parties agreed that each party should pay their own costs including the costs of the husband’s recent application in a case; and
(f)The parties asked to have noted that the husband caused the storage of the D City chattels to be paid until 4 January 2021 and that he had provided documents to the wife to transfer those chattels to her.
The parties had also noted some errors in the Reasons namely:-
(a)that footnote 2 had an incorrect number; and
(b)that paragraph 115 referred to the husband as having other firms of solicitors when in fact it was the wife.
Consequently, these typographical errors have been remedied as follows:-
(a) on page 5, paragraph 41 of the Reasons for Judgment delete the sum of $510,760 in footnote 2 and insert the sum of $510,321; and
(b) on page 16, paragraph 115 of the Reasons for Judgment delete the word husband and insert the word wife.
The Orders have been changed to give effect to the mechanical issues set out above. The perfected Orders were made on 15 December 2020.

I certify that the preceding twelve (12) paragraphs are a true copy of the Corrigendum of the Reasons for Judgment herein of the Honourable Justice Benjamin.

Associate:

Dated: 17 December 2020

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 8422 of 2016

Mr Fonda

Applicant

And

Ms Colton

Respondent

REASONS FOR JUDGMENT

INTRODUCTION

This is a case about anger, retribution and avarice. It is about a couple who have come out of their relationship wreaking economic destruction on the other and ignoring the economic destruction to themselves.
There were arguments as to the credit of Mr Fonda (‘the husband’) and Ms Colton (‘the wife’).
Those arguments were successful in the extreme. I am satisfied the husband and the wife would say almost anything to achieve an outcome and that they are seemingly not constrained by notions of truth or accuracy.
If either one or other of them told me it was daytime, I would be forced to open the door and the window to check the veracity of such assertion.
The husband, in response to the end of his relationship with the wife, determined he would achieve the retribution by requiring the wife to return hundreds of thousands of dollars taken from the joint account and lost in, at times, pointless and wasteful litigation.
This is despite the husband taking significant cash from his business over the years in circumstances where he likely failed to disclose that cash to Australian revenue authorities. That cash fuelled profligate expenditure and a lifestyle enjoyed by both the husband and the wife.
The wife spent tens of thousands of dollars, if not hundreds of thousands of dollars, renovating their property at B Street, Suburb C, D City USA (‘the D City property’) without regard to the parties’ circumstances and likely with the knowledge that part of those funds came from untaxed income.
An Order was made in the Federal Circuit Court for the sale of the D City property and the wife did all within her power to prevent or circumvent that sale. The husband did all within his power to ensure that the D City property did not end up in the ownership of the wife.
During the Cold War the United States of America and the USSR engaged in threatening each other with nuclear destruction and with that threat, achieved world peace by mutually assured destruction (‘MAD’). In the context of these proceedings, the parties engaged in MAD behaviour, but it did not lead to a peaceful solution.
The husband and the wife met in 2005 and commenced cohabitation sometime between 2007 and 2009. They married in 2015 and they separated on 3 December 2016.
Shortly after separation the parties commenced proceedings in the Federal Circuit Court of Australia and adversarial litigation has triumphed since that time.
Each of the parties has spent hundreds of thousands of dollars in legal costs and have engaged in contested hearings in the Federal Circuit Court, the Family Court of Australia and in a superior court in E State.
At the end of the day there will be no winners or losers; there will only be the wreckage of the finances of the parties, such as it is, left to be distributed.
Had these parties adopted a less confrontational approach and looked for solutions rather than victories, they would have ended up far better off than what arises from this decision and the consequent orders. The root cause of the parties’ present circumstances arises from their failure to be sensible and offer each other the respect which was no doubt apparent at the commencement and early years of their relationship.
The end result of the litigation is that the parties will divide up about $510,321, being the proceeds of sale of the D City property and with most, if not all of that money being applied in payment of legal costs.
What is left? The husband retains his business, but given the disclosures in these proceedings there will inevitably be some form of investigation by the Tax Office and, if it finds significant cash receipts not disclosed, the cost to the husband will likely be economically catastrophic. The wife asserts she has some interest in that business, I have determined otherwise. Whilst she may have made some contributions it must be set off against her profligate expenditure.
The husband had been previously married to Ms K (‘the first’ wife). The husband and the first wife separated prior to the husband forming a relationship with the wife. The first wife and the husband settled their property issues. After the husband’s relationship with the wife ended in December 2016, the husband subsequently reconciled and later remarried the first wife. The wife asserts that the husband has equity in the home of the first wife. This was based upon the fact that the husband was a guarantor for the first wife in respect of a mortgage over his first wife’s home and that the wife asserted that the husband had been paying instalments in respect of that mortgage. I have determined that the husband has no legal or equitable interest in the first wife’s home.
The wife has a significant earning capacity which she chooses not to exercise.
What is realistically left for disposal is about $510,321[1] being the remnants of the parties’ equity in the D City property, the husband’s superannuation and some furniture and furnishings.
[1] When I express money in this form it is meant to be Australian Dollars unless the contrary is clear.
An adjustment of property is enabled by jurisdiction and power pursuant to the provisions of the Family Law Act 1975 (Cth) (‘the Act’). Property adjustment is a discretionary exercise of this Court’s powers. If the Court is to exercise such power pursuant to the Courts property jurisdiction, such discretionary powers must be exercised in a ‘just and equitable’ manner.
Under s 79(1) of the Act the Court may (emphasis added) make such property order as it considers appropriate.
Section 79(2) of the Act provides that in property settlement proceedings:-
The Court shall not make an order under this section unless it is satisfied that, in the circumstances, it is just and equitable to make the orders.
If the Court considers that it ought to make a property order it must take into account the matters set out under s 79(4) of the Act.
Neither of these parties come to this Court with any significant degree of bona fides and each endeavoured to use this Court as a device to ‘batter’ the other party.
Over the next 50 or so pages I explain my Reasons.
However, for the parties, I will make it clear. I decline to exercise the powers to adjust property between them. Their property will stay where it now rests or is otherwise agreed. Each party has a half interest in the proceeds of sale of the D City property. It will remain that way and I will put in place orders to enable an equal the distribution of those funds.
I will put in place consent orders that the D City property furniture and the Suburb J property furniture is to be retained by or is to be declared the property of the wife.
The husband’s business was created and acquired at or before the time the parties commenced cohabitation. It is the result of his hard work and the loan from his sister. The wife may or may not have made contribution to that business. If she did, it was modest and would have been well and truly eclipsed by the spending provided to her through the taxed and untaxed income of that business.
There is no consideration to be given to the factors under s 75(2) of the Act as the wife has an established track record for earning significant income.
The husband will retain his business, subject to the liabilities, including that of his sister and no doubt subject to an investigation by the Australian Taxation Office which I will be recommending in the context of these proceedings.
The wife will end up with skills developing from years of work in the property industry and as a business manager who acquires produce and sells it to retailers and in other areas, but with limited or no capital.

THE ISSUES

There were issues of credit raised about the veracity of the evidence of the husband and the wife. Given the reasoning set out herein, both will be both wounded and sobered by those findings.
Neither the husband nor the wife can survive the attacks on their credit given their respective cross-examination.
There is an issue about when the parties commenced cohabitation. The reality is likely somewhere in between the dates asserted by each of the parties. Their cohabitation was likely to be a process not a particular event on a particular day.
There are issues as to the balance sheet, contribution and issues of waste.
In relation to the balance sheet, the wife contends that a loan provided by the husband’s sister to him is not a loan. That assertion is an expression of hope over reality.
The husband claims significant add-backs resulting from expenditure by the wife in the 12 months leading up to separation and the sum of about $318,000 taken by her at separation.
In terms of contributions, the wife asserts that they ought to be assessed on a global basis and as being ‘at least equal’. The husband contends add-backs prior to separation from the joint account including expenditure of some $322,448, a rental bond of some $40,225, a withdrawal from the parties’ joint account of $318,000 and the cost to enforce an Australian court order in the United States of $84,000.
The husband also seeks some adjustment in relation to the sale by the wife of a Luxury motor vehicle in the United States, which was jointly funded, and the application of those sale funds towards the wife’s legal cost in the United States.
The parties’ position in relation to their superannuation is as set out in Exhibit E17. In items 32 and 33 the parties are in agreement. The husbands Super Fund 1 is $105,000 and the wife’s Super Fund 1 is nil.
The husband asserts that the property acquired by the parties during the marriage, now vested in the proceeds of sale of the D City property,[2] ought to be paid wholly to him. He claims the funds are equally owned, but that there ought to be some add-backs.
[2] Commonwealth Bank Account ending in …38 having agreed value of $510,321.
He contends that from the wife’s half interest in the net proceeds of the sale of the D City property there should be deducted:-
a)$159,000 (being one half of the $318,000 the wife withdrew from the parties’ joint L Bank account on separation), and
b)$161,412 (being one and half of the $322,842 that the husband asserts the wife withdrew from the parties’ joint L Bank account in the twelve months prior to separation).
The husband also seeks reimbursement, effectively, of one half the legal costs he incurred in bringing the proceedings in the United States
The wife contends that she should receive 55 per cent of the property on a contribution basis and a further 10 to 15 per cent in respect of the s 75(2) factors making a total of 65 per cent of the $510,321 being the proceeds of sale of the D City property.
There has been an interim distribution of $50,000 to each of the husband and the wife from the proceeds of sale of the D City property. That money has been spent long ago.

BACKGROUND

The husband was born in 1962 and is aged 57. He is a business manager by occupation and there are no health issues to which I need to have regard.
The husband was first married in 1985 to his first wife. There are three children of that relationship: a daughter aged 32, a daughter aged 29 and a daughter aged 20. The husband and his first wife separated in about 2006 and divorced in September 2009. The husband and his first wife settled their property proceedings, with his first wife retaining the proceeds of sale of a Suburb I property.
The husband was, and still is, involved in running a business at Suburb M (‘the Suburb M business).
In 2017, following the husband’s separation from the wife, the husband and his first wife reconciled and they re-married in 2018.
The wife was born in 1974 and is aged 46. The wife had previously been married and had separated from Mr N (‘her former husband’). The wife says, and I accept, that she had a property settlement with her former husband.
There are three children of that relationship: two boys aged 26 and 24 and a daughter aged 22.
The wife is in good health.
The wife has a very good work history. She was involved in the property industry in the early 2000s and then later developed a business wholesaling produce. The wife has earnt significant income from those occupations.
Given the concerns I have as to the wife’s evidence, it is not clear as to how much money was earnt, however, it was considerable and was sustained over many years.
The wife asserts that she and the husband commenced cohabitation in March 2007.[3]
[3] The wife’s trial affidavit paragraph 5 and the husband’s trial affidavit paragraph 8.
The wife filed a debtor’s petition on 15 March 2007 and became a bankrupt. Her only assets at that time were any superannuation entitlements, furniture and personal effects.
In about 2008 the wife incorporated a company called O Consultants Pty Ltd (‘O Consultants’) and commenced working as an agent with Company P.
On 1 July 2009 the husband entered into a loan agreement with his sister Ms Q (‘the husband’s sister’) and borrowed funds to acquire the whole of the interest in the Suburb M business.
In March 2010 the wife was discharged from bankruptcy.
I accept that between April 2007 and August 2008 the wife lived at R Street, Suburb J. I accept that in August 2008 the parties leased a property in S Street, Suburb J where they remained for about one year.
In October 2009 the husband and wife leased accommodation at T Street, Suburb J, and the husband maintained a larger residence in Suburb V. I accept that the husband and wife cohabitated at one or both of those homes.
From March 2012 until April 2014 the husband and wife lived at S Street, Suburb J.
In 2012 the wife worked as an agent through O Consultants conducting business with X Pty Ltd trading as X Business via a consultancy/profit share arrangement. This provided a significant income for the wife.
The wife received 50 per cent of the net profits of the produce transactions she negotiated between producers and Company CC.
I am satisfied that at that time the husband and the wife were each earning substantial incomes and this was reflected in their lifestyle.
In paragraph 33 of his trial affidavit the husband says that his mother and brother sold their jointly owned property and each of his siblings received $181,904.15.
At paragraph 47 of his trial affidavit the husband says his mother died in 2016 and he received $196,382. Of that amount he says he disbursed it as follows:-
a)to his daughter Ms ZZ - $77,071;
b)the renovation of his Suburb M business premises -$100,000 on renovations; and
c)the balance funds were given to a trust fund from which he paid the bond of $12,700 on his residence, an apartment, and purchased household effects and the like.
In April 2014 the husband and wife purchased a property at S Street, Suburb J (‘the Suburb J property’). They paid $1.5 million for this property. The husband provided $160,500 from his savings and the proceeds from the sale of a property. The wife says she provided $160,500. The parties borrowed $150,000 from the husband’s sister and borrowed $1,079,570 from the ANZ Bank.
The wife asserted that she contributed another $38,000 by way of personal loans and the like to assist in the acquisition of the property.
There is an issue between the parties as to whether the personal loans were for stamp duty or the like or for renovations. I am satisfied that the contributions by each of the husband and the wife to the acquisition of this property was essentially equal.
I accept that the husband deposited significant funds, approximately $176,000, into his NN Bank accounts from his business between 2014 and 2016.
In September 2015 the parties sold the Suburb J property for $2,325,000 and that property settled in March the following year. The parties received $1,116,827 which they deposited into their joint L Bank maxi saver account.
On the evidence before me I am satisfied, given the repayment to the husband’s sister of $100,000 and the evidence of the husband’s sister, that the loan was repaid.
Between April 2016 and 3 December 2016 the parties disposed of the whole of the proceeds of sale of the Suburb J property. I will deal with those transactions later in these Reasons.
In April 2016 the parties jointly purchased a condominium which is the D City property for USD1,150,000. The parties borrowed about USD864,000 to assist in that purchase.
There is an assertion that a piece of artwork was purchased at about that time. I will deal with that artwork separately.
In February 2016 the husband and the wife rented a property at Y Street, Suburb J.[4]
[4] Wife’s trial affidavit paragraph 69.
It is an agreed fact the parties separated on 3 December 2016 and that on the same day that the wife withdrew $318,000 from the parties’ joint L Bank savings account. The wife asserts that she paid rent up front $82,124 on Y Street Suburb J. The wife occupied that property to the exclusion of the husband from 3 December 2016 until she vacated that property in March 2018.
In February 2017 the wife commenced a relationship with Mr Z. The wife asserts that this relationship continued until early 2020.
In March 2017 the wife registered a new company called O Investments.
On 19 December 2016 the husband commenced these proceedings and sought orders for the return of the $318,000. Of that sum $150,000 was withdrawn in about February 2017 in cash by the wife. Her initial evidence was that this money was provided to one of her brother’s for a private reason. Her evidence at the hearing was that she did not give the money to her brother and that the money remained with her and that she disposed of it. As I have said elsewhere, I do not believe her.
In September 2017 the wife’s commercial arrangements with X Business concluded.
In her trial affidavit at paragraph 197 wife says that the rent she received for the lease of the D City property between 14 October 2016 and August 2017 was USD92,000. She went on to say in paragraph 198:-
198. … of the above rent received I paid the mortgage and other outgoings for the [D City] property. The rent was paid into my BB Bank Account ending in #...61, and, the AA Bank mortgage was paid from my BB Bank Account ending in account #...61. I also intermingled my income from other sources into my BB Bank #...61 account. The mortgage, however, was always paid from my BB Bank #...61 Account, as per the below.
In paragraph 208 the wife said, inter alia, that for the month of August 2017, she paid the mortgage in full.
At paragraph 209 of the wife’s trial affidavit she the set out her contributions to the D City property whilst it was untenanted. From August 2017 to November 2017 the wife asserts that mortgage payments of USD 5,393.46 were made by her from the parties Joint AA Bank # …16 account. No mortgage repayments were made for December 2017, January and February 2018. In that table the wife alleges that as at 16 March 2018 the mortgage was USD20,718.28 in arrears.
From March 2018 to January 2020 the wife claims that an amount of USD167,200.60 was paid by way of mortgage repayments which were made from her BB Bank account #...61.
At paragraph 210 of her trial affidavit the wife claims that for the period December 2016 to January 2020 the outgoings and costs associated with the D City property, inclusive of the mortgage, totalled for a period of 37 months USD316, 177.58. She then sets those out in a table.
In paragraph 211 of her trial affidavit the wife says:-
211. I have undertaken the following calculation in respect of my post-separation contribution towards the D City property:
(a) Rent received from December 2016 to August 2017 (as deposed to at paragraph 197 above): USD$92,000 (AUD$127,880);
(b)Outgoings for the period December 2016 to January 2020 (37 months x $8,545.34) equals USD$316,177.58 (AUD $439,486.03); and
(c)Outgoings less rent received = my contribution of AUD$311,606.
On 29 November 2017 orders were made in the Federal Circuit Court of Australia which provided for the sale of the D City property. There was no appeal against that Order.
At the same time proceedings took place in the Supreme Court of New South Wales between the wife and X Business.
Those proceedings eventually resolved, the details of which were not made available to me. As to those events the wife set out in her trial affidavit:-
282. As deposed to above, between 2012 to 2017, I (through my entity O Consultants Pty Ltd) conducted business with X Pty Ltd trading as X Business Services ABN … (“X Business”) via a consultancy/profit share arrangement.
283. In the course of these proceedings, a Consultancy Contract was produced under Subpoena by X Business. A profit sharing Agreement was discussed between the Directors of X Business and I, however, I did not ever sign the Consultancy Contract.
284. In or about 2017, I commenced feeling some doubt as to whether I wanted to continue with X Business. The reasons for this were that:
(a)A lot of my produce were being returned by Company CC. This caused considerable waste of product, and financial loss for me as I would still need to pay the market rate for their product. The loss of product being rejected was borne by me and deducted from my profit share.
(b)I began experiencing issues with the directors at X Business.
(c)I received little or no assistance from X Business and the stress was totally on me.
(d)I did not think that X Business were being fair with me in relation to the division of profits and my accountant had raised this issue with me.
285. In or about May 2017, I was unhappy with X Business. At that time, I had a meeting with the national buyer for Company CC in Melbourne. They told with words to the effect:
If you go out on your own we would have no problem dealing with you. We do not know X Business but we know you.[5]
[5] Given it is hearsay, I gave no weight to this paragraph.
286. As a result of my conversation with Company CC, I was provided with paperwork for my own Vendor number and it was granted. This coincided with the end of the harvesting season.
287. On 28 May 2017, [Mr Z] and I flew out to America. [Mr Z] and I returned on 17 September 2017.
288. In or about 8 September 2017, I phoned Mr DD at EE Pty Ltd. I said words to the following effect of:
I want to end my relationship with X Business. It is just not working out. You know that I have been complaining about Mr WW and Mr XX for years. I am happy to continue my relationship with EE Pty Ltd but I am not happy with this circus of X Business.[6]
[6] Ibid.
289. I then proceeded to explain to Mr DD examples of behaviour that I was unhappy with at X Business. I asked, “Can you please send me a letter confirming that my relationship with X Business is coming to an end”.[7]
[7] Ibid.
290. As a result, I received a letter dated 15 September 2017 by email. I received this letter as I was leaving for the United States of America.
291. Upon my return to Australia, I read the letter and the restraint of trade reference. I sent an email to Mr DD on 22 September 2017. After I sent the email, I telephoned and spoke to Mr DD. I said words to the effect:
Why are you referring to a restraint of trade? When we had our first meeting at FF Restaurant I told you that I did not want to sign a restraint of trade and everyone agreed. There is no restraint of trade.[8]
[8] Ibid.
292. Mr DD said:
Oh okay, when I get around to it I will redo it. I am visiting producers at the moment.
I did not hear from Mr DD about fixing the reference or removing the reference to the restraint of trade.[9]
[9] Ibid.
293. On or about 18 October 2017, I decided to part ways from X Business when I found “GG Warehouse” as a space within which I could operate in my own right. I decided to let the termination letter from X Business take effect on 15 October 2017, without entering into a new Contract with them or EE Pty Ltd (in the name of O Investments Pty Ltd).
294. I deny that I telephoned Mr DD and said anything about [the husband]. I did not at that time ask him to prepare an Agreement in the name of O Investments Pty Ltd. He said to me words to the following affect:
Do you want me to prepare an Agreement in the name of another company.[10]
[10] Ibid.
295. I said:
Yes but I don’t want to do anything with X Business. If the Agreement is between my company and EE Pty Ltd I would be happy with that.”[11]
296. I deny that I said anything about the company being of no value in relation to the divorce settlement.
297. I started trading under O Investments Pty Ltd from Tuesday 24 October 2017.
298. On 27 October 2017, X Business commenced proceedings in in the Supreme Court (proceedings number 2017/…) seeking, inter alia, an interlocutory injunction against me (with O Consultants and O Investments named as second and third defendants in the proceedings) (“the Supreme Court proceedings”).
299. On 15 November 2017, the application for interlocutory relief was heard by Justice Rein. On 24 November 2017, Justice Rein granted the restraint of trade.
300. [The husband] filed three (3) Affidavits in the Supreme Court Proceedings on behalf of X Business. [The husband] was not directly involved in X Business in any way that would warrant his involvement in those proceedings. This caused me considerable stress and I felt that it was another example of [the husband] being overly litigious towards me.[12]
301. On 10 February 2018, a confidential settlement was agreed to and I signed a non-disclosure agreement such that I cannot disclose the details of that Agreement in these proceedings.
302. I am aware that [the husband] contends that my conduct was such that I (as per letter from [the husband’s] lawyer to my former lawyer, HH Lawyers, dated 16 March 2018): “deliberately terminated her [my] agreement with X Business Service for the purpose of ultimately misleading the Family Court as to her [my] actual true financial position.” I say that is simply untrue, and, refer to the matters deposed to above.
[11]Ibid.
[12] I have given no weight to this final sentence.
I do not know what to make of the veracity of this evidence, given my concerns as to the overall reliably of the wife’s evidence.
There was an agreed fact between the parties that after the orders were made for the sale of the D City property, there were a number of offers made by the wife (between November 2017 and January 2020) to enable her to purchase the property from the husband. The parties could not agree on the terms for any such sale.
The wife filed an Application in a Case to vary the order of the Federal Circuit Court for the sale of the D City property and requesting that it be sold to her. The wife filed a Notice of Discontinuance in relation to that Application on 23 March 2018.
In March 2018 the husband commenced proceedings in the Superior Court of E State seeking enforcement of the Australian orders for the sale of the D City property.
The parties were divorced in April 2018. The husband and his first wife remarried in July 2018.
In March 2019 the husband’s first wife purchased a property at Suburb KK, the details of which I have referred to elsewhere in these Reasons.
On 9 October 2019 proceedings were heard in E State before a judge and orders were made appointing the husband as trustee for the sale of the D City property. On 23 January 2020 further orders were made by the judge enabling the sale of that property.
The sale was completed and the sum of $614,968 was paid into a joint account.
As indicated earlier, the wife asserts that she paid $311,606 to maintain the D City property. Clearly, had the wife complied with the order of the Federal Circuit Court made in November 2017 much of that expense would have been avoided.

The wife deposes that she and Mr Z separated in February 2020.
In March 2020 the matter was listed before a Judge of the Family Court who directed payment of $50,000 to each of the parties for the purpose of these proceedings.
Any statement of fact made in these Reasons is to be regarded as a finding of fact unless the contrary is clear from the context.

THE EVIDENCE

The husband relied upon the following documents:-
·his Financial Statement filed 10 August 2020;
·his Affidavit filed 10 August 2020;[13]
·an Affidavit of the his first wife filed 10 August 2020
·an Affidavit of the husband’s sister filed 10 August 2020; and
·an Affidavit of his daughter Ms ZZ filed 17 August 2020.
[13] Husband’s trial affidavit.
The wife relied upon the following documents:-
·her Amended Response to Final Orders filed 11 August 2020;
·her Financial Statement filed 11 August 2020;
·her trial affidavit and Exhibit bundle filed 11 August 2020;[14]
·an Affidavit of the wife’s friend Ms LL filed 10 August 2020; and
·an Affidavit of the wife’s son, Mr MM (‘the wife’s son’) filed 10 August 2020.
[14] Wife’s trial affidavit and Exhibits – Exhibit E4 (2 volumes).
A single expert was appointed for the purpose of valuing the husband’s business and the wife’ business. His reports are referred to later in these Reasons.
A number of documents were tendered in the trial, those being:-
Exhibit E1:the husband’s Amended Case Outline in word format prepared by Ms Dart of counsel dated 21 August 2020;[15]
[15] On the 8 September 2020 my legal associate wrote to the parties’ solicitors requesting that they provide copies of their client’s affidavits and case outlines filed in these proceedings in word format to Chambers. The husband’s solicitors provided their documents to Chambers on the 9 September 2020 and the wife’s solicitors provided their documents on the 14 September 2020. On the 15 September 2020 my legal associate wrote the wife’s solicitors about some differences between the word version of the husbands Amended Case Outline sent to Chambers on the 9 September 2020 and the husband’s Amended Case outline which had been filed on 21 August 2020. On the 15 September 2020 the husbands solicitors wrote to Chambers advising that the only change between the husband’s word version of his Amended Case Outline and the one which was filed on his behalf on 21 August 2020 is that in the word version “the parties date of marriage should read “10 October 2015” in both items 4 and 5”. On 16 September my legal associate wrote to the parties’ solicitors noting this difference and a further difference which was that the wife’s name had been deleted and substituted with the husband’s on the cover page and asked them to advise the Court whether they had any objection to the Court adopting the husband’s word version of his Amended Case Outline forwarded to Chambers on 8 September 2020 as Exhibit E1. On the 16 September 2020 the parties’ solicitors wrote to Chambers noting their agreement and consent in relation to same.
Exhibit E2:the wife’s Case Outline prepared by Joshua Grew of counsel dated 21 August 2020;
Exhibit E3:Exhibits to the husband’s trial affidavit;
Exhibit E4:Exhibits to wife’s trial affidavit (2 bundles);
Exhibit E5:the wife’s tender bundle;
Exhibit E6:the husband’s Costs Notice;
Exhibit E7:the wife’s Costs Notice;
Exhibit E8:this was in two parts: Part 1 being the cash payment schedule for NN Bank asserting cash payments of $165,500 and Part 2 which was the Commonwealth Bank of Australia streamline accounts together with a schedule;
Exhibit E9:Commonwealth Bank statements of the husband’s first wife from about December 2017 through to May 2020 and another account being her Smart Access account and other Commonwealth accounts of the husband’s first wife (pages 1 to 158);
Exhibit E10:      OO Bank account statements of the husband’s sister from June 2007 to June 2020 (39 pages);
Exhibit E11:      the husband’s objections to evidence of the wife and Ms LL;
Exhibit E12:      the wife’s BB Bank statements from account number ending …61 from November 2015 to June 2016 (18 pages);
Exhibit E13:      the Minute of Order sought by the husband;
Exhibit E14:      the wife’s L Bank complete freedom account from May 2016 to November 2016 (account number ending …41);
Exhibit E15:      the single expert report – Valuation of the husband’s Suburb M premises and business;
Exhibit E16           the valuation of the wife’s businesses (O);
Exhibit E17           a Joint Balance Sheet
Exhibit E18           cheque book stubs from the husband’s sister in relation to the OO Bank loan on her house which was lent to the husband;
Exhibit E19           a letter from the wife’s solicitors to the husband’s solicitors dated 10 July 2020 and reply dated 13 July 2020;
Exhibit E20           a schedule of the wife’s financial disclosure tendered by agreement;
Exhibit 21the husband’s amended short minute of order; and
Exhibit 22the wife’s minute of order.
As indicated elsewhere in these Reasons the parties agreed that their final separation occurred on 3 December 2016. The parties also agreed that, with regard to the D City property, after the orders were made in November 2017 for sale of that property, the husband and the wife exchanged a number of offers from then until January 2020. Those offers were in relation to the wife retaining the D City property.
The parties could not agree on terms.
In terms of the case outlines, objections and form of orders, I have treated those as merely the submissions of the parties. The only exception to that course is where they assert consistent dates such as birthdays, date of marriage et cetera.
As to costs, the husband asserted[16] that he had the following:-
·Costs incurred to 21 August 2020  $193,166.57
·Unbilled costs and disbursements  $40,235.00
·Estimate of costs for hearing  $44,500
[16] Exhibit E6 – The husband’s Costs Notice.
This means that the husband will have spent about $278,000 by the conclusion of the hearing.
In addition to the above costs, the husband incurred costs in relation to the proceedings in the United States in the sum of USD$56,609 which I accept equates to AUD84,002.
The wife incurred legal costs on preparing the matter for trial and the hearing of $195,749.[17]
[17] Exhibit E7 – The wife’s Costs Notice.
In addition the wife had a number of other firms of solicitors who acted for him in previous proceedings. The full details of those costs were not made available to the Court.
In evidence the wife said that she sold a Luxury motor vehicle purchased by the parties in the United States for USD21,000 which she applied to fund her legal fees in relation to the proceedings in the United States.
It is likely that the parties have between them spent more than $500,000 in legal costs in their conflict in Australia and the United States since separation.
Had the parties resolved the matter early in the piece then the amount that they could have been dealing with would have been a sum of about $1,000,000 or more in assets.
I have discussed earlier the acquisition of parties’ property at S Street, Suburb J. I am satisfied that each party in their own way contributed approximately equally to the acquisition of that property.
I accept the parties purchased furniture for that property, although the nature and extent of that purchase is not clear to me given my concerns about the veracity of the evidence of both the husband and the wife.
I am satisfied that the parties sold the S Street property and received a net sum of $1,191,599.

The husband

The husband provided evidence in terms of his trial affidavit and financial statement.
The husband gave evidence in chief that there were a series of invoices from his company.[18] These were allegedly paid invoices for breakfasts provided to the wife.
[18] Exhibit E5 volume 1 of 4, pages 2 to 44.
These invoices were no doubt provided by the wife to undermine the husband’s evidence about providing meals, breakfasts and the like to the wife and her business associates in the produce business.
The husband says that whilst these paid invoices were on his letterheads he had nothing to do with those invoices.
In cross-examination the husband said they may have arisen out of an old computer, but they were not done by him or on his behalf.
What I am left with is the implication, presumably as asserted by the husband, that this was evidence created by the wife to assist in her case. From the wife’s perspective it probably means that the husband’s assertions about the wife’s contributions were untrue and that she had made significant contributions to his business.
Given the concerns I have about as to the veracity of the evidence of both the husband and the wife I can really make nothing of those documents.
In cross-examination the husband conceded that the wife provided a celebration for the husband’s 50^th birthday, that the parties travelled overseas including to the United States and Bali and at times travelled business class and stayed at five star hotels, dined at high end restaurants and made purchases at shops such as Louis Vuitton, Jimmy Choo, Chanel and Gucci.
The husband conceded that sometimes they travelled with the husband’s children.
The husband denied that the wife worked with him at the Suburb M business. There is some evidence that she did, although the veracity of the evidence of the wife and the wife’s friend Ms LL is questionable.
The husband was cross-examined in relation to the type of litigation between the parties and in that respect was taken to correspondence between the wife’s then solicitors and the husband’s present solicitors.[19]
[19] Exhibit E4 pages 634 to 636.
In many ways, that shows there was high conflict and the husband, through his solicitors at that time, adopted an unconstructive and unhelpful approach. The solicitors for the wife made sensible suggestions which were arbitrarily rejected. That was unhelpful.
The husband was cross-examined in relation to the Fonda Kids Trust Fund which he set up for his children with the monies from his mother’s estate. I have mentioned this trust earlier in these Reasons.
As I say elsewhere in these Reasons I am satisfied that the funds were the property of the husband and he has given most of it away to his children. In terms of those funds much was made of it, although the wife made little or no contribution to the acquisition of those funds.
The husband was cross-examined about the arrangements with his sister. I am satisfied that they are legitimate arrangements and that the husband’s sister helps him from time to time in terms of those funds.
The husband was cross-examined in relation to the financing of his first wife’s property at Suburb KK. It is clear that the husband has made contributions towards the acquisition of that property through providing the status of his income to enable the loan. I am also satisfied that from time to time the husband makes modest payments to assist his first wife as to the ownership of that property.
However, given the evidence of the husband’s first wife, I accept and find that either his first wife or her family undertake the lion’s share of the repayments on that property. Further, the husband’s first wife borrowed an additional sum of $100,000 to facilitate the husband funding these proceedings.
There was much ado about the purchase of a Luxury motor vehicle by the parties in the United States. This was apparently registered in the name of the wife’s business in that country. I am satisfied that the husband was present when the car was collected and I am satisfied that he knew about its acquisition.
The husband was cross-examined in detail in relation to cash deposits made to his first wife’s account.[20]
[20] Exhibit E9.
In relation to all of the deposits made in Region PP of New South Wales the husband said they were not made by him. In relation to the ones made at Suburb M he said he cannot recall. This evidence was supported by the evidence of the husband’s first wife and I am satisfied with the veracity and reliability of her evidence.
The husband was cross-examined in relation to the cash deposits to his NN Bank account totalling about $165,500 to which I have earlier referred. I infer that they were likely cash deposits from his business.
The husband was at times glib in relation to his evidence and at times obfuscated in respect of questions.
There are multiple reasons why I have concerns about the veracity of the husband’s evidence.
The first was my observations of the husband giving evidence during the first two days of hearing and in particular his demeanour when responding to difficult questions.
Some other examples are when the husband was cross-examined about the correspondence between his solicitors and the wife’s then solicitors, Cappello Rowe, of 6 March 2018.[21] The husband seemed unconcerned about the impact of the ‘dog in a manger’ approach adopted by his solicitors on his instructions. Generally the practitioners who were involved in this matter at the time of the hearing operated in an effective and sensible way. However, there were some examples of poor communication and the conflict between the parties seemed to impact on those representing the parties.
[21] Exhibit E4 pages 34 onwards.
An example can be seen through Exhibit E19. This was a sensible and effective letter sent by the wife’s solicitors to find out what needed to be disclosed. It was met with an aggressive and a non-responsive letter which was, in all of the circumstances, unfortunate.
I am satisfied that the wife has made efforts to make disclosure as set out in Exhibit E20. However, I am not convinced that it is necessarily complete or reliable.
Another example of my concerns about the veracity of the husband’s evidence was in relation to the husband’s explanation about the acquisition of the Luxury motor vehicle in the United States. The husband initially dissembled and then obfuscated in relation to his knowledge about the purchase of that vehicle.
This was similar to his evidence in relation to the trips to the United States; he dissembled in providing answers to those questions.
Finally, in relation to the sale of the D City property, I observed the husband’s anger and I accept the evidence of the wife that he was determined not to allow her to acquire the property.
There may have been justifiable reasons for the husband’s anger, but it appears to have started at least at the time of separation most likely in the period leading up to 3 December 2016.
The husband did not subsequently tell the wife that he did not want the D City property sold to her and despite offers by the wife to do so he proceeded in a determined fashion to cause it to be sold to someone other than the wife.
In relation to the husband’s inheritance of about $196,000 from his mother’s estate, I infer on the evidence that the husband was determined to take it out of the pool of property. There was little point in doing so. His evidence in relation to that circumstance was equivocal.
I am not satisfied that the husband was frank in giving evidence and neither am I satisfied that he was wholly truthful in giving evidence. Given his answers to questions and his demeanour I find that it is likely that the husband will say whatever is necessary to get the result which he desires. I will treat his evidence as essentially unreliable.

The husband’s first wife

The husband’s first wife provided evidence in her affidavit sworn 3 August 2020 and filed 10 August 2020. The husband’s first wife is now aligned to the husband and is strongly supportive of him.
This witness gave evidence that she and the husband were first married in 1985 and separated in about 2006. They were divorced in September 2009.
The husband and his first wife have three children. After separation the husband’s first wife received a property at Suburb I which she sold and then purchased another property.
I accept the husband’s first wife’s evidence that there was a poor relationship between herself, their children and the wife.
The husband’s first wife gave evidence about the acquisition of her property at Suburb KK where she and the husband live. I accept that the husband made no direct final financial contribution to that property and that his first wife contributed approximately $820,000 to that purchase and borrowed the rest from a mortgagee.
I am satisfied that the husband assisted in that acquisition by joining in the mortgage and enabling his income to be used as part of the material upon which the mortgage application was based.
I am further satisfied that the husband borrowed an additional $100,000 against that property to partly fund these proceedings. To some extent that property is, and has been, treated as a financial resource of the husband.
I am satisfied that at the present time the Suburb KK property is owned by the husband’s first wife and that the husband has no legal or equitable interest in that property.
The husband and his first wife were cross-examined in relation to a significant amount of cash payments that were made against the mortgage.[22]
[22] Exhibit E9 Smart Access account ending in …98 pages 8 to 54.
The husband’s first wife acknowledged those cash payments into that account and gave plausible evidence as to the providence of those funds; that is from her wealthy family. On balance, I accept her evidence in that regard.
The husband’s first wife was cross-examined in relation to her income which is modest, although she now works again for the husband’s business.
On my observations of the husband’s first wife, whilst she is aligned with the husband, her evidence was not shaken and I am satisfied that she was endeavouring to be truthful.

The husband’s sister

The husband’s sister gave evidence in terms of her affidavit sworn and filed 10 August 2020.
In her evidence the husband’s sister said that she worked at the husband’s business (then a partnership) and was paid a wage depending on how many hours she worked. She was not challenged as to that evidence.
The husband’s sister supported the evidence of the advance to the husband of $181,904 in November 2013, which was used by the husband to purchase a property between himself and the wife.
The husband’s sister gave evidence as to providing a mortgage over her house to enable the husband to buy out his former partner’s interest in the Suburb M business.
The husband’s sister gave evidence that she and the husband entered into an agreement on 26 June 2007. This agreement provided for repayments to her plus interest.
The husband’s sister said that the husband did not always meet the repayments and from time to time the husband sought and received funds from that mortgage account.
This witness made it clear that she expected the loan to be repaid. She also frankly stated that she would assist the husband as he was ‘her brother’.
I accept her evidence in relation to the mortgage and accept that the mortgage is real and that this witness requires it to be repaid.
The OO Bank statement supporting the allegations of the loan and the advances to the husband was in evidence before me.[23] It very much supported the contentions of the husband’s sister.
[23] Exhibit E10.
There was an issue about a painting which was forwarded to the home of the husband’s sister. The husband’s sister gave evidence that when it arrived she made enquiries of the husband and he said he did not want it. The husband’s sister thought it looked like a picture of the wife naked and said she did not want the picture and eventually put it out for collection as trash.
The evidence given by the husband’s sister was frank and to the point and I am satisfied with the veracity of it.

Ms ZZ

The husband’s elder daughter gave evidence in terms of her affidavit sworn 13 August 2020 and filed 17 August 2020.
This affidavit was read into evidence without controversy subject to the deletion of the final part of paragraph 7 and the whole of paragraph 8 which were not read. I have treated the evidence of this witness as being uncontentious.

Ms ZZ observed that the husband and the wife spent time together on weekends from up to June or July 2007 when Ms ZZ found an apartment in Sydney. The wife provided a reference.
There is some form of interaction between the wife and Ms ZZ.
Ms ZZ said she received $50,000 from her father and later another $35,000.
I am satisfied as to the veracity of that evidence. I am satisfied that it supports the notion that the relationship between the husband and the wife developed over 2007 and 2008 and that sometime during that period they began cohabiting permanently together.

The wife

The wife gave evidence in terms of her affidavit sworn and filed 11 August 2020. It was a voluminous document of some 80 pages of typed evidence. Subject to objections, parts not read and weight, that affidavit was read into evidence.
The exhibits to that affidavit are Exhibit E4 which contain 636 pages of documents and are in two bundles. There is an index at the commencement of volume 1.
I am not critical of the length of that affidavit as the financial machinations of the husband and the wife are at times, complex. It is worthwhile to briefly reiterate the wife’s personal circumstances.
She is aged 46 years of age and she and the husband commenced cohabitation in 2007 or 2008 and were married in 2015. It is an agreed fact that they separated on 3 December 2016 and they were divorced in April 2018.
There are no children of her relationship with the husband, but she has three children of a previous marriage. Those three children are all adults.
The wife formed a relationship with Mr Z in February 2017 and she and Mr Z began living together in September 2007. That relationship apparently ended on 20 February 2020.
Mr Z is an undischarged bankrupt. The wife said he became bankrupt in 2018. Mr Z has not provided information to his trustee. Her evidence is that Mr Z is likely to remain a bankrupt until 2026.
The wife gave evidence as to the parties’ commencement of cohabitation. I am satisfied, as I said earlier, that it was a process rather than a single event and occurred over 2007 and 2008.
The wife gave evidence as to her initial financial contributions which were modest. The wife gave evidence as to the development of her business selling produce on a wholesale basis.
The wife gave evidence of the property in which she and subsequently the husband lived in up to April 2014.[24]
[24] Wife’s trial affidavits paragraph 42 and 43.
I accept that the husband and the wife travelled to D City at least annually.
As to the payment of airfares, given my concerns about the evidence of this witness and the evidence of the husband, it is not clear to me who paid what airfares.
I accept the evidence of the wife that she and the husband enjoyed a luxurious lifestyle which she and the husband worked hard to provide.
I am satisfied that the wife earnt a significant income from 2008 until separation and probably following separation. That income would be measured in hundreds of thousands of dollars, although the precise amount is not known given my concerns about the reliability and/or the completeness of the wife’s documents.
An example of this was the difference in the documents provided as to the value of the wife’s business and the lessor of the wife’s Luxury sports car 1 in 2020. A further, example included the difference between the wife’s stated income to the mortgagee for the purchase of the D City property and generally.
When questioned about these issues, the wife prevaricated, dissembled and endeavoured to blame others. I am satisfied that much of those explanations were disingenuous if not fabrications.
The parties purchased a property together at Suburb J for $1.5 million in April 2014 and each provided roughly half of the monies towards that purchase. It is likely the wife contributed a little more than the husband.
That house was renovated with money and work from both the husband, the wife and with assistance from the wife’s children.
About one year after purchase of the Suburb J property it was sold by the parties for $2,325,000, the gross difference of about $800,000.
The net amount retained by the parties after settlement of its sale was $1,016,827. This was also after the repayment of a loan to the husband’s sister of $100,000. The settlement of the Suburb J property was roughly concurrent with the parties’ purchase of the D City property. They paid $1,150,000 for the D City property, the acquisition of which I discuss elsewhere in these Reasons.
The D City property was tenanted from October 2016 until August 2017. As I indicated earlier in November 2017 an order was made in the Federal Circuit Court for the sale of that property.
I am satisfied that the wife did all that she could to delay, obfuscate and prevent the sale of that property as she wished to retain it herself.
The wife transferred funds from the parties’ joint bank accounts in the United States, which had a balance of over $1 million in February 2016, and a balance of about $318,000 on 3 December 2016. The wife took the balance of those funds.
In paragraph 88 of her trial affidavit the wife endeavoured to explain the expenditure of just under AUD700,000. It was not clear to me how that money was expended. Clearly some was used for the acquisition of the D City property, the mortgage payments, the Luxury motor vehicle, furnishing for that home, renovations on that home and other expenses.
The wife asserted she used some of her own monies which may or may not have been repaid. No clear picture was painted.
In his trial affidavit the husband said that on 3 December 2016:-
67. … I became aware that [the wife] transferred $318,000 from the Joint Maxi Saver Account to an account [the wife] had opened in her own name with L Bank Account No. #*** ("the L Bank #*** Account"). [The wife] has never accounted to me or this Honourable Court the whereabouts of the $159,000 being half of the monies I say I was entitled to in the Joint Maxi Saver Account.
The husband went on to say that he commenced proceedings in the Federal Circuit Court.
The husband says that the wife applied $150,000 as a partial property settlement, $82,124 as rent in advance on the premises where she lived and $20,845 to pay out a personal loan. There is no clear evidence as to what happened to the balance of about $65,000.
In respect of this evidence, practically about the disposition of the $150,000, I have grave concerns about the truthfulness of the wife’s evidence. This is given her differential evidence between her trial affidavit and her affidavit filed in early 2017. Her responses to questions in cross-examination had the sense of invention or fabrication.
The wife conducted business through various entities during the parties’ relationship. The wife has a current interest in O Consultants and says this company is solely owned by her and is currently not active.
The wife had an interest in O LLC Company in the United States. She says no business has been conducted through this company.
The wife has a current company called O Investments which is trustee for the O Trust which was established before the husband and wife separated. It seemingly has no meaningful assets.[25]
[25] See valuation Exhibit E16.
The wife gave evidence about the development of her business in produce sales.
The wife also gave evidence in respect of her support of the husband in his hospitality business. Given the evidence of the wife, the evidence of the husband and the evidence of the other witnesses I am satisfied that the wife provided some help in that business, but certainly not to the extent set out in her affidavit.
I am satisfied it is either exaggeration or fabrication to a large extent on the part of the wife.
The wife gave evidence as to the loan between the husband and the husband’s sister. I am satisfied it is likely that the wife’s evidence in that respect of conversations with the husband’s sister about that loan was fabricated. I form this view because of the wife’s answers and the equivocation of her answers to questions in the witness box. I prefer the evidence of the husband and the husband’s sister in relation to that loan.
The wife gave evidence as to significant assistance she provided to the husband and the husband’s mother, prior to the passing of the husband’s mother. I am satisfied that some assistance would have been given, but not to the extent asserted by the wife in her trial affidavit.
The wife gave evidence of overwhelming home duties and duties at work which she undertook during the course of cohabitation. I am satisfied that the husband and the wife each contributed about equally in non-financial ways as homemakers and parents of their respective children.
The wife persuaded a leasing company to provide her with a new Luxury sports car 1 in February 2020 and the previous year had purchased, but had not retained, a 4WD. In cross-examination the wife was asked about her assertion as to her income of $310,000. She gave explanations as to why that was incorrect.
The wife had asserted to lenders that she had a multi hundred thousand dollar income from 1 July 2019 until early 2020, an income of $350,000 in 2017/2018 and of $310,000 in 2018/2019. The wife asserts this came from an employee not her. I do not believe that evidence as it is inherently implausible that she did not know the amounts of income she asserted when buying expensive cars.
I am satisfied that the wife still enjoys a luxurious lifestyle, as to the wherewithal to fund such lifestyle; it remains elusive.
The wife said that when she formed a relationship with the husband she became involved in litigation with her former husband and spent about $350,000 in parenting proceedings. How that was funded, given her bankruptcy in about 2007, remains opaque.
The wife was cross-examined in relation to the sale and her willingness to engage in the sale of the D City property. She obfuscated, she fabricated and she dissembled in relation to the sale of that property.
The cross-examination of the wife was tedious and deflecting. She did not answer questions directly. Speeches were often made by the wife and no real effective reasons were given for not facilitating the sale of the D City property except that the wife said that she wanted the property. The wife did not appeal the decision of Judge Monahan that the husband sell the D City property and she eventually discontinued her application in this Court whereby she was seeking to acquire the D City property.
The wife simply engaged in the proceedings in the United States to prevent the sale of the D City property. She was unsuccessful in those proceedings. Her evidence as to her motives in this regard was deeply improbable.
The wife’s evidence in relation to that given to the Court in her affidavit of 27 February 2007 was similarly troubling. The wife said that she took the cash out and that the money was ‘used’.
The wife obfuscated in relation to that evidence and it is clear the money was used by her.
The wife was cross-examined in relation to the financing for the D City property. She provided information in respect of that purchase which was different from the documents in her tax returns.
I watched the demeanour of the wife giving evidence and I was troubled by some of her answers and the opportunities she took to make speeches.
Given my general concerns about the evidence of the wife I am satisfied it is likely that there is a level of exaggeration and fabrication by her in that evidence.
For the reasons set out above, I am satisfied that her evidence is generally unreliable and focused on an outcome rather than notions of truth. I treat it with great care.

Ms LL

Ms LL is a friend of the wife and she provided an affidavit affirmed and filed 10 August 2020. Ms LL is a relative of the husband’s first wife and it appears that they have been estranged since about 2006.
Ms LL gave evidence about the wife and the husband commencing a relationship in about 2006. At that time Ms LL and her husband operated two businesses with the husband, being the Suburb M business and a business at Suburb UU.
Ms LL gave some evidence which supported the wife’s contention that the parties’ cohabitation commenced in 2007.
I was concerned about this witness’ evidence. Her evidence seems to be, on the face of it and by watching her demeanour and listening to her answers, coloured by her perceptions of and her friendship with the wife. I have treated her evidence as partisan and I have treated it with some care and scepticism.

The wife’s son

The wife’s son provided evidence in his affidavit sworn and filed on 10 August 2020.
The wife’s son was an impressive witness. He was asked how he recalled his first meeting with the husband when he was about nine years old. He answered frankly and said that it was exciting to go to a business premises and to meet the owner. He gave evidence about his involvement with the husband and the wife and I have regarded his evidence as being generally reliable.
The wife’s son gave evidence about his work at the Suburb J property. He was an impressive young man and I regard his evidence as generally reliable and frank.

The single expert

Mr QQ (‘the single expert’) is a forensic accountant who provided evidence that he has expertise in the valuation of smaller and mid-sized businesses in a wide range of industries. His expertise was not put in issue by either party and his valuations were admitted in evidence by the consent of the parties.
The single expert was appointed to value the husband’s business and the consequent shareholding of the company which operates the business.
The single expert was also instructed as a single expert to value the wife’s business and shareholding in a series of companies called O.
Those valuations did not become available until 26 August 2020 in terms of the husband’s hospitality business and 2 September 2020 in relation to the wife’s produce wholesale business.
On 7 September 2020 the proceedings came back before the Court and the two valuations were tendered in evidence by consent. They were the valuations of the husband’s Suburb M premises and business [26] and the valuation of the wife’s O business and corporate structures.[27]
[26] Exhibit E15.
[27] Exhibit E16.
As to the husband’s business, the single expert valued the business at $197,500. The valuation was based on a capitalisation of earning method as set out in the valuation.[28]
[28] Exhibit E15 page 18.
In his valuation the single expert said that the value of the shares in the company which owned the Suburb M business were nil and the husband was owed $213,801[29] which the single expert said was recoverable.
[29] Ibid page 20.
The parties consequently agreed that the loan repayable to the husband was that sum,[30] subject to the advance by the husband’s sister of $357,904 which I have accepted and discussed elsewhere in these Reasons.
[30] Exhibit E17 item 9.
As to the wife’s business, the single expert valued it at nil.[31] In coming to this conclusion the single expert recognised the trend in the produce business from using agents, the financials of the business and the high reliance on the wife.
[31] Exhibit E16 page 14.
One set of financial statements was provided by the wife through her accountant to enable the valuation. A different set of financial statements for the financial years 2018 and 2019 were provided by the wife to facilitate the acquisition by her of a Luxury sports car 1.
The single expert expressed doubts as to the accuracy of the financials provided for the purchase of the Luxury sports car 1. He set out his reasons in that respect. The single expert expressed ‘surprise’ that a combined earnings difference of $794,067 was not discovered earlier.
The single expert went on to say that he doubted that the loan for the Luxury sports car 1 would have been approved based on the subsequent financials.
I am satisfied that the wife, despite her denials, was aware of the difference in the financials and provided financials to the car company which were wholly inaccurate.
I accept the valuations prepared by the single expert are reliable and I have had regard to that evidence.

FINDINGS

Cohabitation

In his trial affidavit the husband asserts that he and the wife commenced cohabitation in 2009.[32]
[32] Paragraph 8.
The wife asserts in her trial affidavit[33] that they commenced cohabitation in March 2007.
[33] Paragraph 5.
The wife goes on to set out that she met the husband in 2005 and that shortly after meeting the husband she left her career in the property industry and worked in the husband’s business at Suburb UU.
The wife sets out details of those circumstances in paragraph 26 of her trial affidavit, excluding paragraph (c)(ii) which was not read.
This evidence was supported by the evidence of the wife’s friend Ms LL in her affidavit filed the 10 August 2020.
The husband says that in about April 2007 the wife asked for assistance in obtaining accommodation. He said he arranged an apartment for her and her children at Suburb J which he rented for her.
The husband’s assertion is that cohabitation did not occur until some 20 months later.
The husband’s evidence is in part assisted by the evidence of his daughter Ms ZZ.[34]
[34] Affidavit 13 August 2020 which was read in without objection.
Having heard all the evidence and heard the cross-examination of the husband, the wife and Ms LL, I am satisfied that cohabitation was not a fixed time, but gradually occurred over the second half of 2007 and into 2008. I am satisfied that cohabitation was occurring by late 2007 early 2008.

The husband’s interest in property at JJ Street, Suburb KK

I accept the evidence of the husband’s first wife that at the time she and the husband reconciled in December 2017, she owned a property at U Street, Suburb V.
I accept that the husband’s first wife sold the property at U Street, Suburb V for $910,000 which left her with a net sum of about $819,470.
After the husband and his first wife reconciled and remarried, the first wife found a property at JJ Street, Suburb KK, which she purchased in her name for $1,800,000.
The husband’s first wife contributed $819,470 and she borrowed $1,050,000 from RR Bank. The husband provided his personal guarantees to enable this loan to be approved. I am satisfied that the loan would not have be made available to the first wife, but for the personal covenants of the husband.
The husband lives at that property with his first wife.
The husband’s first wife was not joined as a party to the proceedings. It was asserted by the wife that the husband had significant equity in that property and that I ought to take that equity into account in the context of these proceedings.
There is no evidence of the current value of the husband’s first wife’s property at Suburb KK other than the evidence that the husband and his first wife paid $1,800,000 for that property in 2019, about a year or so ago.
There is no evidence that the mortgage on that property has been significantly reduced.
The wife contended that the husband’s first wife did not have the capacity to meet the loan repayments on the Suburb KK property, which are currently about $5,700 per month, and said that the likely source of those repayments was from the husband’s Suburb M business.
I accept the evidence that the husband’s first wife had, until her remarriage with the husband, a very modest income and continues to have a very modest income and would not be able to pay or meet the mortgage expenses.
The husband gave evidence that he paid some monies towards the Suburb KK property from time to time, but not significant monies.
As I have said elsewhere in these Reasons, I am sceptical of the veracity of the husband’s evidence. The husband was taken through a series of cash payments made to his first wife’s bank account being:-[35]
[35] Exhibit E9 the husband’s first wife’s bank CBA account ending in …98.
(a)    27 March 2019 in the sum of $2,200;
(b)    19 April 2019 in the sum of $1,000;
(c)    13 June 2019 in the sum of $5,000;
(d)    27 March 2019 in the sum of $4,000;
(e)    9 April 2019 in the sum of $5,000;
(f)     30 April 2019 in the sum of $5,000;
(g)    15 May 2019 in the sum of $8,000;
(h)    25 June 2019 in the sum of $9,000;
(i)     18 July 2019 in the sum of $1,000;
(j)     27 August 2019 in the sum of $4,000;
(k)    24 September 2019 in the sum of $5,000;
(l)     11 November 2019 (from Company A) in the sum of $7,500;
(m)   12 November 2019 in the sum of $7,500;
(n)    14 January 2020 in the sum of $7,000;
(o)    24 January 2020 in the sum of $7,500; and
(p)    18 February 2020 in the sum of $6,500.

Interim property distribution

Pursuant to orders of the Family Court made earlier in 2020 each of the parties was paid the sum of $50,000 out of the proceeds of sale of the D City property.
I have determined not to ‘add-back’ those sums. However, I have taken this into account in terms of s 75(2)(o) of the Act. Given the matters that I have discussed elsewhere in these Reasons I do not intend to either add these back or give the sums any considerable weight in either contribution or the s 75(2) factors.

Luxury motor vehicle

Each of the parties sought to have the Luxury motor vehicle valued. No individual valuation was provided to the Court.
The Luxury motor vehicle was sold and the proceeds of USD21,000 was applied by the wife towards her costs defending the enforcement proceedings for the sale of the D City property.
The husband had an equitable interest in part of that sum. I have dealt with that in terms of the adjustment of property in relation to both contribution and the s 75(2) factors.

Value of wife’s business

The business has a determined nil value as discussed elsewhere in these Reasons.

Legal costs of the husband in the United States

The husband expended USD56,768 (AUD82,597). I have dealt with that in terms of contribution and in terms of the relevant s 75(2) factors.
The wife seeks an add-back in relation to the agency fees for the sale of the D City property totalling $86,660. This is presumably on the basis that she was prepared to buy the property without the intervention of an agent.
Given that the D City property was sold pursuant to orders of this Court and that sale was facilitated by enforcement orders in the United States, I will not be taking into account such add-back.

The D City property

The wife was reluctant to give up possession of the D City property. Her evidence about giving and allowing access to the D City property was such that she prevaricated and I am satisfied that it was necessary for steps to be taken by the husband, including the court proceedings, to enable access to the property which involved repairs and work undertaken on the door at a cost of $8,000.
I have had regard to this in the contributions and in relation to the s 75(2) factors.

Liabilities

The only liabilities to which I will have regard will be the loan from the husband’s sister. This was the money borrowed by the husband to acquire his interest in the Suburb M business.
I have determined the valuation of the Suburb M hospitality business as $197,500 as per the evidence of the single expert.[53] Overall the shares in the company which owns the business have a negative value.
[53] Exhibit E15.
Each of the parties claims liabilities in terms of credit cards. The husband asserts a liability of $21,048 by way of a NN Bank Visa Card and $10,148 in terms of a AC Bank credit card.[54]
[54] Husband’s further amended financial statement paragraphs 51 and 54.
The wife claims credit card liabilities with BB Bank Visa US of $25,603.
Each of the parties has spent significant monies on their lifestyle and other factors since separation. It is not clear what purposes these monies were used for following separation except that it was likely in continuation of their expensive lifestyles.
In those circumstances I do not intend to have regard to those amounts.

Add-backs

For the reasons I have expressed elsewhere in this judgment I note that each of the parties received an interim distribution from the proceeds of sale of the D City property in the sum of $50,000.
I have had regard to that sum however, I do not intend to add it back as requested.
In relation to the claim for the add-back of monies paid by the husband to provide for the storage and furniture in D City, I do not intend to add that sum back. It needed to be spent and ought to have been spent.
I have had regard to the wife’s removal of $318,000 from the parties joint bank account at the time of separation. Of that sum $150,000 has not been accounted for.
Given the broader comments I have made I have had regard to it, but I do not intend to order a repayment to the husband of all or part of that sum for the reasons set out clearly elsewhere in this judgment.
As to the liabilities I accept that the husband has a liability to his sister, which I have discussed elsewhere, a Visa card liability and an AC Bank Credit card liability. I accept the wife has a BB Bank Credit card liability. I have included them as liabilities in respect of each of the parties as set out above.

Superannuation

Neither party is seeking an adjustment of superannuation. The wife had a modest superannuation account which she has drawn against in the context of the COVID-19 permissions and has applied that to living expenses.
The husband has Super Fund 1[55] of about $105,000 which I will treat as an asset of the husband in a single pool.
[55] Husband’s further amended financial statement.

The proceeds of sale from the D City property

What is then left is essentially the $510,321 being the proceeds of sale of the D City property.
The husband’s case is that the whole of that amount of $510,321, ought to be paid to him.[56]
[56] Exhibit E21.
The wife seeks an order that she should receive the balance of those funds less an amount of $71,000 payable to the husband.[57]
[57] Exhibit E22.

CONTRIBUTIONS

At the time the husband commenced his relationship with the wife, that being 2007, 2008 or 2009, I am satisfied that he had acquired the whole interest in the Suburb M premises and business. I accept that the business, at that time, owed $166,000 to the Australian Taxation Office and, as I have said elsewhere, the husband had borrowed $450,000 from his sister. The business seemingly had some value at that time. The husband derived a good income from the business.
The husband said he had no other significant financial interest following his property settlement with his first wife.
I accept that the wife made some very modest contributions to the husband’s businesses.
I accept that the wife was bankrupt at the time the parties commenced cohabitation. The only assets of the wife were household furniture and appliances and her Super Fund 1 entitlements of about $38,000.
In addition to the Suburb M business the husband had owned or had an interest in a business at Suburb UU. It is clear from the evidence that that business folded in about 2009.
The husband deposed that in November 2003 his mother and brother sold a property at Suburb VV. The husband deposes that he and each of his siblings received a sum of $181,904.
This explains the husband’s ability to contribute towards the acquisition of the property located at S Street, Suburb J.
Counsel for each of the parties conceded that the contributions towards that purchase were about equal.
In his Financial Statement the husband says he has an Super Fund 1 of $105,000.
The husband’s mother died in April 2016 and the husband received from that estate the sum of $196,382.[58] Of that sum he says he gave $77,071 to one of his daughters and he spent $100,000 on his business. He claims this was set up as a trust for his children.
[58] Husband’s trial affidavit paragraph 47.
It was his money and I will not regard the sum of $100,000 he used in his business to be treated as a liability. I will however treat it as having been spent.
I accept, on balance, that he paid a bond of $12,700 as set out in his trial affidavit.[59]
[59] Ibid paragraph 47(c).
In relation to the husband’s late mother’s estate. I am satisfied that the wife made little or no contribution to this sum.
I accept that the husband made payments to his sister in relation to the loan to purchase the Suburb M business, but then from time to time withdrew funds from that account.
As at March 2007 the wife had a company called O Pty Ltd which was apparently deregistered in 2020.
In August 2008 the wife incorporated O Consultants Pty Ltd (‘O Consultants’) and this was the business she used as an agent for the sale of produce.
The wife has a company called O LLC in E State. There is no evidence that this company has any value.
I accept that each of the parties helped each other and their business, in a modest way, from 2008 onwards. Given the concerns I have as to the evidence of each of the parties I am unable to determine the extent of those contributions.
In April 2014 the husband and wife purchased a property at Suburb J which I have discussed elsewhere in these Reasons. They paid $1.5 million for this property. The husband provided $160,500 from his savings and the proceeds from the sale of a property. The wife says she provided $160,500. The parties borrowed $150,000 from the husband’s sister and borrowed $1,079,570 from the ANZ Bank.
The wife asserted that she contributed another $38,000 by way of personal loans and the like to assist in the acquisition of the property. I find the wife contributed another $38,000 by way of personal loans and the like to assist in the acquisition of the property.
There is an issue between the parties as to whether the personal loans were for stamp duty or the like or for renovations. I am satisfied that the contributions by each of the husband and the wife to the acquisition of this property was essentially equal.
I accept that the husband deposited significant funds, approximately $176,000, into his NN Bank accounts from his business between 2014 and 2016.
The parties made roughly equal contributions to the D City property. They otherwise made equal contributions in respect of their non-financial contributions.

The section 75(2) of the Act factors

(a)The age and state of health of each of the husband and wife;

The wife is aged 46 years and she is in good health.[60] The husband is aged 57 years and his evidence is that he is good health.

(b)The income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;
[60] Wife’s trial affidavit paragraph 381.

The husband lives in the home of his first wife and she provides accommodation for him and he helps, in a modest way, from time to time.
The husband has a valuable business which was acquired shortly before or at the time cohabitation commenced.
This business provides financial support for the husband and for the husband’s first wife. I note the valuation of the single expert.
I am satisfied that the husband’s business is likely to have been impacted by the COVID-19 Pandemic. It is not clear to me whether the husband and the husband’s first wife are in receipt of JobKeeper.
The wife has skills in the business of wholesaling produce. This enabled her to earn a substantial income from 2008 onward. That income was often measured in hundreds of thousands of dollars per year.
I am satisfied that the wife still has that capacity to earn income, albeit it is likely to be impacted by the current COVID-19 economic impact. However, the extent of that impact is unclear.
Each of the parties has engaged in adversarial litigation and each has spent hundreds of thousands of dollars in that capacity. The wife says that once these proceedings are completed then she wishes to live in the United States and set up a business in that country.
That is a matter for her however, as I have said, she has the capacity to earn substantial income in Australia.

(c)Whether either party has the care or control of a child of the marriage who has not attained the age of 18 years;

There are no children of the relationship and the parties are not responsible for any dependent children.

(d)Commitments of each of the parties that are necessary to enable the party to support:
(i)himself or herself; and
(ii)a child or another person that the party has a duty to maintain; and

The husband needs to support himself and to assist in the support of his first wife.
The wife has the responsibility to support herself. She asserts that she is no longer in a relationship.

(e) The responsibilities of either party to support any other person;

This was not the subject of relevant submissions.

(f)Subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii)any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;

and the rate of any such pension, allowance or benefit being paid to either party; and

This was not the subject of relevant submissions.

(g)Where the parties have separated or the marriage has been dissolved, a standard of living that in all the circumstances is reasonable; and

This was not the subject of relevant submissions.

(h)The extent to which the payment of maintenance to the party whose maintenance is under consideration will increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income;

This was not the subject of relevant submissions.

(ha)The effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and

This was not the subject of relevant submissions.

(j)The extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and

The husband has the benefit of occupation in the home of his first wife and was able to draw $100,000 against the home to, in part, fund this litigation
This was not otherwise the subject of relevant submissions.

(k)The duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and

The relationship was conducted over about eight years.

(l)The need to protect a party who wishes to continue that party’s role as a parent; and

This was not the subject of relevant submissions.

(m)If either party is cohabiting with another person – the financial circumstances relating to cohabitation; and

Insofar as the wife was concerned, this was not the subject of relevant submissions.
The husband lives with his first wife.

(n)The terms of any order made or proposed to be made under s 79 in relation to:
(i) the property of the parties; and
(ii) vested bankruptcy property in relation to a bankrupt party; and

This was not the subject of relevant submissions.

(naa)the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i)a party to the marriage; or
(ii)a person who is a party to a de facto relationship with a party to the marriage; or
(iii)the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and

(na)Any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, or is to provide, or might be liable to provide in the future, for a child of the marriage; and

This was not the subject of relevant submissions.

(o)Any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and

This was not the subject of relevant submissions.
I have considered all of these factors, including those referred to in other parts of these Reasons. The parties each have a capacity to earn a strong income. I see no reason or basis to make any overall adjustment in regard to these matters.

DISCUSSION

What do I make of all of this?
The husband has a hospitality business at Suburb M which produces huge profits. This Court will never know what those profits are as the husband has not made full and frank disclosure as to his income and, it is more likely than not, that he has tens of thousands if not hundreds of thousands of dollars secreted away through cash payments.
The Suburb M business was the husband’s business prior to the parties commencing cohabiting and any contributions made by the wife were minimal.
The husband was determined to ‘win’. I accept the wife’s evidence that the husband would take whatever steps were necessary to prevent her from acquiring the D City property. He succeeded and in doing so (and necessarily in concert with the wife) has undermined the value of the parties’ interest in that property.
The husband is an unreliable witness.
The wife is equally an unreliable witness. She chose to do whatever she could to secure the D City property notwithstanding Orders being made by the Federal Circuit Court of Australia and the Superior Court of E State.
What is clear is that the wife has a tremendous capacity to earn income. Whether that be in property, the produce business or possibly her beauty products into the future.
It is likely that over the years she was in a relationship with the husband that she, like the husband, earnt hundreds of thousands of dollars in income.
The wife is not afraid to manipulate the facts to suit her purposes. The loan applications for the Luxury sports car 1 acquired by her earlier this year reflected her use of figures and financial statements which were different to those she provided to the tax authorities. She blamed her accountant and her book-keeper and took no blame for herself.
Similarly, when loans were applied for with regard to the property in D City, she provided a different set of income tax returns from those which she actually lodged with the Taxation Office.
The wife’s evidence is troubling.
The husband and the wife engaged in a lavish lifestyle throughout their relationship. That is their choice. The Family Court is not a court of morals or some form of parsimonious social consciousness.
When their relationship broke down both parties engaged in high level conflict and high level dissipation of assets.
The wife fabricated evidence such as that to the Federal Circuit Court about the whereabouts of the $150,000 she took out in cash.
This Court will never know what the true financial circumstances of either of these parties are.
What the Court does know is that the only significant asset left, apart from the husband’s interest in the business which he had acquired well before the parties commenced their relationship and for which he owes his sister a considerable amount of money, was the interest in the property at D City.
In equity, parties seeking relief must have ‘clean hands’. In family law the parties have a jurisprudential obligation and a regulatory obligation to make full and frank disclosure.
In terms of the husband, as I said earlier, what he earns and how he disburses his income is unclear. It is likely that he earns significant amounts each year in cash which is not disclosed to the revenue authorities and which was probably not disclosed to the single expert preparing the valuations.
Therefore the valuations of the Suburb M business is substantially compromised.
Given the referral I intend to make to the revenue authorities it is likely that the husband may end up with a substantial liability to the tax authorities.
I have not treated any possible taxation outcome as a liability.
The wife walked away from her property business shortly before or at the time the parties commenced cohabitation. She engaged in high level conflict with her previous husband, the father of her three children and, on her evidence, spent hundreds of thousands of dollars in doing so.
It is unclear what the wife earnt in her property business.
The wife made relatively minor contributions to the husband’s business and then set up her own businesses as a produce wholesaler or acting as agent for a produce wholesaler.
It is clear that the wife likely made hundreds of thousands of dollars per year in that occupation until she ended up in Supreme Court proceedings with X Business.

After the litigation with X Business was resolved, the wife obtained a recognition from Company CC as a supplier. This enables her to wholesale produce to Company CC.
The wife is not exercising that earning capacity at the moment. The wife says she wishes to abandon that source of income and make money from skincare products.
The wife bought expensive items such as Hermes handbags, Gucci products, Chanel and other expensive products.
In the United States she purchased a Luxury motor vehicle, sold it and retained the profits. She withdrew $318,000 from the parties’ joint account on separation and used $82,000 or so paying rent on her premises. This is despite earning or having the capacity to earn significant income so she could meet that expense. As I said earlier the wife fabricated evidence in relation to her disposal of the $150,000 in cash.
This couple clearly entered into their relationship with enormous passion and enjoyed a wealthy lifestyle including business class trips overseas and expensive material items.
This Court will never know the truth or the facts of that relationship. It will only be given the partisan view of the now deep hatred each has for the other and the deep disrespect each has for the other. This Court is going to do that which the parties ought to have done in December 2016, that is, to divide the property equally.
All that is effectively left is the husband’s superannuation and the $510,321 from the sale of the D City property.
At the commencement of the submissions I was told that it was an agreed fact that the wife had used her superannuation (referred to in the hearing) of $12,199 for her support during the COVID-19 circumstances.
The parties said that they had, for all intents and purposes, agreed on the pool of assets. The evidence of the single expert was admitted without controversy and he was not required for cross-examination.
The parties indicated to the Court that they agreed that the furniture from the D City property was to be retained by the wife.
Counsel for the husband submitted that in terms of contribution, I should look at the property holistically. I have rejected that notion. I have endeavoured to deal with the property on an item by item basis and on an overall basis.
I am satisfied that the wife has made little or no contribution to the husband’s Suburb M business. I have treated that as a separate item notwithstanding that it is an overall debit of about $144,000.
The husband retains monies in the bank, SS shares and jewellery. Given that I propose to make no orders to effect any adjustment in property, he will also take about $255,000 from the proceeds of sale of the D City property. He will retain his superannuation and remain responsible for the loan to his sister and the credit card loans.
The wife will retain half the proceeds of the D City property, the household contents of the D City property and the Suburb J property totalling $70,000 and her jewellery of $15,000. She has liabilities of a credit card debt of $25,887.
I do not intend to add-back a half share of the Luxury motor vehicle nor I will add back the half share of the legal costs in relation to the proceedings in the United States.
I am satisfied overall that the parties contributions between 2008/2007 and 2008/2009 were equal.
The parties have both also been equally destructive of the wealth that they had accumulated during that time.
The husband retains the Suburb M business and it is clearly sufficiently strong enough for him to purchase a Luxury sports car 2.
The wife is not presently working however, she has a proven working capacity to which I have referred elsewhere.
I have considered all of the relevant s 75(2) factors and had I made a property order I would have made no adjustment in relation to the s 75(2) factors.
The wife claims that she made significant post-separation contributions to the property in D City. In the first year they owned the property it was tenanted and it was only towards the end of 2017 that the property became vacant. The wife had lived in the property from time to time after that date. There was an order made in the Federal Circuit Court in November 2017 that she sell the D City property.
The wife did not facilitate the sale as she wanted to purchase the property. The parties entered into negotiations from time to time, but never reached a settlement and in the meantime the wife paid the expenses to retain the home. This cannot be said to be a contribution because its value must be set off against the wife’s failure to comply with orders of the Federal Circuit Court. She did not appeal those orders nor did she ultimately pursue an application to vary those orders.

CONCLUSION

Pursuant to s 79(1) of the Act I am empowered to make, or not make, such orders as is considered appropriate. Section 79(2) goes on to say that any order I make must be in circumstances where the Court is satisfied that, in all of the circumstances, it is just and equitable to do so.
In the circumstances of these parties they come to the Court full of fabrication and the like. They use the proceedings a device to pursue their anger and bitterness against the other.
Where the property rests at the present is primarily equally, given what is left, apart from superannuation.
It would be contrary to the principles of equity that this Court reward either party by exercising it discretionary jurisdiction to adjust property. I do not consider that it is appropriate to do so. I will make orders as to personal property as the parties seek, but I will not otherwise do so and I implicitly dismiss their broader property applications.

COSTS

I do not know whether there will be an application for costs by one or other of the parties following these proceedings. I will make a standard order giving parties leave to make costs applications in accordance with the Rules.[61]
[61] Family Court Rules (Cth) 2004.
However, I have considered the claims by the husband for the wife to account to him for part of the proceeds of sale of the Luxury motor vehicle acquired in the United States.[62] The wife had used the proceeds of sale of that vehicle to meet her legal costs in the proceedings in the Superior Court of E State.
[62] Exhibit E17 item 24.
Further, the husband sought an adjustment in his favour in relation to the funds incurred by the parties having a United States attorney take proceedings to enable the sale of the D City property.
It is in that context of the narrow dispute that I have concluded that this Court ought not to make any adjustment of property having regard to the equities between the parties.
I have considered that the wife has already, in effect, paid one half of those costs. Given the overall approach I have made in regard to these proceedings I will not be ordering a further adjustment in that respect.
It is not open for either one or other of the parties to make a costs application and seek a further agitation of those United States legal and enforcement expenses.

REFERRAL TO COMMISSIONER OF TAXATION

Serious allegations were made by and on behalf of the wife that the husband had earned significant cash income from his hospitality business. The wife asserted in her material[63] that this included payments of cash by the husband into his NN Bank Cards accounts numbered ending in 9100 and 8423 totalling about $165,500. The wife says these were paid between 2015 and 2016 and are identified in Exhibit E 8(1).
[63] Exhibit E8 cash payment schedule from Citibank.
When cross-examined in relation to these transactions the husband declined to answer questions in respect of those payments on the basis that an answer may lead to him admitting some form of criminal offence. Consequently, I drew an adverse inference against him. If the wife’s allegations were accurate it is likely that the husband may be required to pay significant funds to the Commissioner of Taxation. I have not considered that outcome in this determination.
The clear inference for me was that the wife’s assertion in this regard was in fact correct.
I raised with counsel for the husband as to whether I ought or ought not to refer the papers and documents relating to the husband to the Commission of Taxation for consideration as to whether any of the laws of Australia have been broken.
The husband’s counsel submitted that I should not.
The evidence of the wife and the implicit and explicit allegation of tax evasion is of a serious nature. The amounts involved may be in the tens of thousands of dollars of tax evaded by the husband. I had considered that the husband had taken cash over a period of two or three years totalling about $165,500 and that if, as was inferred, it was not subject to tax, that the husband would be met with a significant tax bill penalties and interest.
Given the detail of the evidence and the nature of those submissions and notwithstanding the submissions made by counsel for the husband, I determine that it is appropriate for me to refer this matter in the manner which I had indicated.

I certify that the preceding four hundred and seventy nine (479) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Benjamin delivered on 4 December 2020

Associate:

Date: 4 December 2020

[2020] FamCA 1085

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