GALENA & GALENA
[2020] FCCA 432
•12 March 2020
FEDERAL CIRCUIT COURT OF AUSTRALIA
| GALENA & GALENA | [2020] FCCA 432 |
| Catchwords: FAMILY LAW – Property Settlement – assessment of contributions. |
| Legislation: Family Law Act 1975 (Cth), ss.75(2), 79, (2), (4) |
| Cases cited: Stanford & Stanford [2012] 247 CLR 108 |
| Applicant: | MS GALENA |
| Respondent: | MR GALENA |
| File Number: | LNC 550 of 2019 |
| Judgment of: | Judge McGuire |
| Hearing dates: | 3 & 4 February 2020 |
| Date of Last Submission: | 4 February 2020 |
| Delivered at: | Burnie |
| Delivered on: | 12 March 2020 |
REPRESENTATION
| Counsel for the Applicant: | Ms R Brown |
| Solicitors for the Applicant: | Legal Solutions |
| Counsel for the Respondent: | Ms J Higgins |
| Solicitors for the Respondent: | Frost & Associates |
ORDERS
That the wife shall:
(i)Within forty two (42) days of the date of these Orders pay to the husband a lump sum of $35,921;
(ii)Transfer and/or vest all her right title and interest in the following to the husband absolutely:
(a)All personalty and chattels in the possession of or under the control of the husband as of the date of these Orders;
(b)The balances of any bank accounts or like investments of the husband as of the date of these Orders;
(c)Any motor vehicle in the possession of or under the control of the husband as of the date of these Orders;
(d)The husband’s superannuation policy and entitlement with Super Fund A;
(e)The benefit of the outstanding loan to the husband’s family being an ANZ residential investment loan (balance $63,000E); and
(f)The balance of outstanding loan to the husband’s family ($30,000).
That contemporaneously with cash payment from the wife to the husband pursuant to Order 1 hereof, the husband transfer and/or vest all his right title and interest in the following to the wife absolutely:
(i)The property situate at B Street, Town C in Tasmania;
(ii)All personalty and chattels in the possession of or under the control of the wife as of the date of these Orders;
(iii)Any bank account or like investment in the name of or to the benefit of the wife as of the date of these Orders;
(iv)The wife’s motor vehicle; and
(v)The wife’s superannuation policy and entitlement with Super Fund D.
That the husband be solely responsible for and indemnify the wife in respect of the following liabilities:
(i)The outstanding Capital Gains tax liability of the husband;
(ii)Any and all liabilities attaching to any of the assets to be retained by the husband pursuant to these Orders; and
(iii)Any and all liabilities incurred by the husband since separation in either joint names or in his name alone.
That the wife be solely responsible for and indemnify the husband in respect of the following liabilities:
(i)Any liabilities attaching to any of the assets retained by the wife pursuant to these Orders but specifically in respect of the mortgage liability secured by the property at B Street, Town C in Tasmania and for these purposes the wife make her best endeavours to re-finance such mortgage in her name alone;
(ii)Any and all liabilities incurred by the wife since separation in either joint names or in her name alone.
That should the wife be unable or unwilling to retain the former matrimonial home at B Street, Town C in Tasmania on the Orders set out above then the husband have first option to retain that property together with its mortgage liability and there then be a distribution of the assets, liabilities and superannuation policies of the parties as set out above but with a cash adjustment between the parties so as to reflect the overall distribution of property pursuant to [63] of these accompanying reasons as to a net 53% to wife and a net 47% to the husband.
That the parties or either of them have liberty to apply in respect of Orders relating to the property situate at B Street, Town C in Tasmania and the mortgage secured by that property.
That pursuant to Section 81 of the Family Law Act 1975 the parties intend that these Orders shall as far as practicable finally determine the financial relationship between them and avoid further proceedings between them.
IT IS NOTED that publication of this judgment under the pseudonym Galena & Galena is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT LAUNCESTON |
LNC 550 of 2019
| MS GALENA |
Applicant
And
| MR GALENA |
Respondent
REASONS FOR JUDGMENT
Applications
These are property settlement proceedings commenced by the wife in an application filed 6 August 2019.
On her version of the property pool, the wife proposes that she retains 70% of the non-superannuation pool with the parties each retaining their superannuation entitlements which she calculates would result in roughly equality of distribution of property inclusive of superannuation between the parties with the husband having a far superior superannuation entitlement.
The husband, who takes a far different view than the wife as to the contents and value of the property pool, proposes a settlement whereby he receive 60% of the property pool on a 'one-pool' basis inclusive of superannuation.
The issues
The following can be isolated as the major issues between these two parties:
a)There is disagreement as to the ‘relevant date' for consideration by the Court in respect of the parties’ separation. The factual platform here is unusual. The parties agree generally that they separated emotionally in late 2012 or early 2013. At that time the husband left Tasmania to reside primarily in Darwin. Notably, the parties are not yet divorced. They both agree, albeit to different degrees, that they remained financially intertwined from the date of separation until about March 2019. The wife says that their income was ‘pooled' and that she continued to manage the finances including paying the bills for both of them whilst having access to the husband's bank accounts and credit cards. The husband is in general agreement as to the wife's proposition in respect of financial management although he does not go so far. He agrees that the wife managed his finances but does not agree that their incomes were 'pooled'. Essentially, he says that the wife had access to his monies, income and bank accounts but that he was not accorded the same privilege in respect of hers.
b)The husband claims that the parties are indebted to his father, Mr E, in respect of a debt of $100,000. The wife denies that there is any such debt. The parties agreed that they built the former matrimonial home on land that formerly belonged to the husband’s parents. The husband says that a ‘deal' was reached in about 2006–08 whereby the land at B Street, Town C would be transferred from the husband's parents to the parties and on which they would build their home. The husband says that the ‘deal' was conditional upon the parties repaying to the father the value of the land agreed at hundred thousand dollars but only upon the sale or transfer by them of the property. The home and land have at all times since its transfer from the parents been registered solely in the name of the husband. The mortgage obtained to build the home was in name of the husband only. The wife agrees that the land was transferred from the husband's parents to the husband at the relevant time and that they borrowed money to build a home (having also sold their former property at B Street, Town C) and that the mortgage was obtained solely in the name of the husband. She says, however, that some consideration was paid, and in her recollection it was a sum of $75,000.
c)There is a dispute between the parties as to the status of a $30,000 debt owing to the parties from the husband's family businesses being the residue of an original $50,000 loan drawn down by the parties from the mortgage account and paid to the husband's family. The husband says that the debt should be included as an asset of the parties and that upon repayment it then be distributed according to the overall percentage distribution pursuant to these orders. The wife says that my orders should have the husband retaining the benefit of the $30,000 as part of his entitlement given the historical personal and financial arrangements between the husband and his family and given the apparent precarious financial positions of the husband's family and their businesses.
d)In or about 2010 the respondent husband obtained an ANZ residential investment loan in the sum of $70,000. The wife was not a party to this loan although there is dispute between the parties as to whether or not the wife had prior awareness to the obtaining of the loan. It remains unknown on the evidence as to whether or not the loan is secured by the property at B Street, Town C registered in the name of the husband. The husband says that the loan monies were expended on the purchase of motor vehicles, a $35,000 family holiday to the Country F, and for renovations. He says its balance owing of $63,000 is therefore simply a debt of the marriage. The wife says that the loan was taken out without consultation with her and without her prior knowledge. She says that the husband's family was the beneficiary of the loan and that she and her family unit in no way benefited. The balance of that loan is currently agreed at an estimated $63,000. The wife says that, in the circumstances of the husband unilaterally obtaining the loan and the benefit going to his family, then he should be solely responsible for that loan and indemnify the applicant accordingly in the sense that the loan be the 'property' of the husband and not be included in the property pool for distribution as ‘matrimonial property'.
Background
The husband is forty nine years of age and the wife is fifty two years.
The parties commenced cohabitation in 1989 and were married in 1993.
There are two children of the marriage being X born in 1996 (age 23 years). X lives in Darwin and is financially independent. Secondly, there is Y born in 2004 (age 15 years) who lives in Town C with the wife.
The parties agree that they separated emotionally from their relationship in either late December 2012 or January 2013 when the husband left the former matrimonial home at B Street, Town C to live in Darwin. As mentioned above, however, the relationship has remained connected, at least on a financial basis.
The wife re-partnered in March 2019.
The wife commenced these proceedings by application filed 6 August 2019.
The wife is employed as an office worker with Employer G. She has an income of approximately $59,000 per annum.
There is no indication that the husband has re-partnered. He continues to live in Darwin and is employed as a professional and perhaps for one of the entities of his family’s group of companies. His evidence as to his actual beneficial income was vague given certain apparent contributions from his family. His most recent financial statement discloses an income of $57,200 per annum.
Relevant law
Matters of property settlement are dealt with by Section 79 of the Family Law Act 1975 ('the Act').
Pursuant to s.79(2) of the Act, the Court should not make an order under this section unless it is satisfied, in all of the circumstances of the particular parties, that it is just and equitable to do so. This consideration is not to be conflated with a simple consideration of the contributions of the parties pursuant to s.79(4) of the Act although those contributions may have contributed to the consideration.[1] In the matter before me, there are indeed a plethora of contributions of various types made by each of these parties and on their behalf in a marriage that has brought into the world two children. The relationship commenced as long ago as 1989 and those contributions have continued. A major asset being the former matrimonial home is registered solely in the name of the husband and the wife's interest, if any, sits in equity. There remains a dependent child of the relationship. I am satisfied that the marriage is at an end. In all of these circumstances, I am comfortably satisfied that it is just and equitable pursuant to s.79(2) to proceed to consider an alteration of the parties’ property.
[1] Stanford & Stanford [2012] 247 CLR 108
That being the case, I am to firstly determine the ‘property pool’. Property may be assets, liabilities or financial resources. Amendments to the Act provide that superannuation is to be 'treated as property' although, of course, not strictly an asset in the sense that it is usually not crystallised until a later time.
The Court is then to attribute value to the elements of the property pool and hence to the pool itself.
Next and pursuant to s.79(4)(a)-(c) the Court is to consider the contributions of the parties to the acquisition, conservation and improvement of any of the property of them or either of them. Contributions may be of a direct or indirect financial type. They maybe contributions of a non-financial type including as homemaker or parent.
After consideration of the contributions of the parties and the impact on the potential alteration of the property pool, the Court then considers whether there should be any further adjustments to either of the parties by reason of the matters set out in s.79(4)(d)-(g) and including any relevant considerations under s.75 (2) of the Act.
It is generally accepted that as a final step the Court will 'stand back' and consider whether the proposed orders themselves resulting from the above considerations are just and equitable as distinct from the proposed percentage distributions.
Credit
Issues of credit as well as the relative historical recollections of the parties are of some import in this matter. I did, of course, have the advantage of seeing and hearing each of the wife and the husband give their evidence. The wife was more confident and clear in her historical recollections than was the husband. The wife's evidence had the ‘ring of truth'. She was informed and spontaneous in her responses in cross-examination despite the financial complexities of the parties’ relationship and the flux of time. Her evidence generally and her responses in cross-examination were not framed in any form of criticism of the husband. She was able to particularise the unusual financial situation that continued after the physical separation in 2012 of the wife effectively managing the finances for both she and the husband. I accept the tenor of her evidence being that the husband essentially delegated the role of financial manager to her until about March 2019. She had access to his bank accounts. She had access to the mortgage account which was in the husband's name alone. Accepting, as I do, that she assumed and was delegated the role of financial manager for both of them, it is only natural to assume that she has a superior knowledge of the financial intricacies of each of them and a better recollection of the financial histories.
The husband's evidence was not so impressive as that of the wife. He was not prepared to go so far as did the wife in agreeing that she managed the entireties of his finances or that they 'pooled' their incomes. It seems that the husband sits at the lower level of a family group of companies and, whilst a director and shareholder of those companies, his evidence leads me to conclude that his brothers and/or his parents operated those companies without much or any involvement by the husband. His historical recollections and understanding of the intricate financial matters is not high For instance, he deposed that it was his father who gave land to the parties conditional upon the husband repaying a sum of $100,000 should the property be sold or transferred. The husband's father gave evidence that it was indeed his wife, the husband's mother, who was involved in this transaction. The husband seemed oblivious, or at least uninformed, as to the husband's father’s recent bankruptcy and the apparent voluntary administration of the family group of companies or some of them.
In summary and generally, therefore, the wife was a frank and informed witness where the husband presented as uninformed and at times prevaricating in his evidence. In issues of direct credit between these parties I therefore generally prefer the evidence of the wife over that of the husband.
Date of separation
The authorities make it clear, for obvious reasons, that generally speaking the court should take the date of the hearing as the relevant date in determining the elements of the property pool and the values of those assets and liabilities. The striking fact in this case is that the parties are in agreement that their emotional relationship ceased in late 2012 or early 2013. At that time the wife and the children remained in Tasmania and the husband moved to Darwin. Nevertheless, I am comfortably satisfied that they remained financially intertwined in the sense, as set out above, that the wife continued to manage the finances of both she and the husband. She had access to his bank account. She had access to his mortgage account. As she says, she 'paid the bills'. She received an inheritance of some $122,000 after separation in 2013 but deposited $110,000 of those monies into the home mortgage solely in the name of the husband. She agreed to at least one drawdown of $50,000 from the husband’s mortgage to members of his family where that re-draw facility was only available by reason of her injection of her inheritance monies.
Husband’s assertion of $100,000 debt to his father
The husband says that the parties are indebted to his father for a sum of $100,000 owing in respect of the land at B Street, Town C in which the parties build the former matrimonial home. The husband asserts that the land was transferred to him on the condition that the value of the land be paid to his father upon the sale or transfer of the property.
The wife disputes that there was such an arrangement. She agrees that the land was transferred to the parties. At [23] of her trial affidavit she deposes:
In 2006 Mr Galena’s father gifted us a block of land at B Street, Town C. I was never aware of any conditions on the block, or that any monies were to be repaid to Mr Galena’s father. It was (sic) generous gift to our family. It had a Government valuation of $75,000 at the time it was gifted to us. I thought at the time that Mr Galena did pay his father something for the property but I am not certain.
In her evidence in cross examination the wife responded that she thought the sum of $75,000 had been paid to the husband's father at the time of the transfer. She informed this evidence by saying that her recollection is of the husband and she being 'pleased with themselves' at the time that they were not in any way indebted to his parents.
It is proper to note, however, that in her case summary document filed with the Court appears a statement that the husband’s parents ‘gifted’ the parties the block of land. There is no reference there to any payment. That document, of course, is not, strictly speaking, evidence in that it is not a sworn statement and one most probably prepared by the wife’s solicitor. I also find it unusual that the wife’s recollection is vague and uncertain as to what if any payment was made to the husband’s parents where in other respects the wife is an excellent historian.
The husband says in his trial affidavit affirmed 20 January 2020:
61. In around early 2008 whilst still residing in Tasmania, discussions were had with my father, Mr E, where we were discussing my desires to build my own property to have as my family home.
62. I recall at the time my father owning various plots of land located throughout Tasmania and other States within Australia. It was during the above discussion where my father advised me the various agreements that he had made with my two (2) brothers, all of whom have their own families.
63. I recall my father stating that he had provided plots of land to my brothers on the promise that they would repay him the current market value of the land at the time it was given to his brothers.
64. With that, and knowing my desires to build my own property for my family, my father entered an agreement with me where he would transfer a plot of land to me for no purchase price, but rather when the time would come that I would sell the land or give it to someone else, that I repay the sum equating to the market value of the land at the time it would be given to me.
65. Given my lack of funds to purchase a plot of my own, I decided to accept the proposal from my father.
66. Thus, in around 2008, my father transferred to me, for no consideration, the block of land situated at what is now known as number B Street, Town C in the State of Tasmania, on the condition that I repay to him the value of the land at the date of transfer.
67. The transfer of the land is evident under the Premium Property Information Report provided by the Tasmanian Government. I annex and mark with the letter 'A' Premium Property Information Report for B Street, Town C.
The husband's evidence is that the debt to his father is $100,000 and presumably, following from the above, on that being its value at the date of the transfer.
No written contract has been adduced in evidence and, according to the husband, no written contract was even drawn.
Significantly, in his earlier affidavit affirmed 6 September 2019 in respect of this issue the husband deposes:
35. In or around 2008. my father, Mr E gifted a vacant piece of land to me that he owned (sic) no consideration. We would eventually build the matrimonial home, on this land to be addressed as B Street, Town C in the State of Tasmania, (‘marital home’).
36. My father transferred the above land solely into my name which is evident under the Premium Property Information Report provided by the Tasmanian Government. I note pursuant to the information report, my father purchased the land in or about 1988 in the sum of approximately $32,000
…
39. To my knowledge, the value of the property at the time it was transferred from my father to me was worth approximately $90,000-$100,000.
Interestingly, in his first affidavit, the husband claims a gift by his father to him of the relevant land. He did not claim a debt attaching to the advancement.
In his financial statement affirmed 10 September 2019 the husband does not disclose any debt to his father in a quantum of $100,000 or at all. In his financial statement affirmed 24 January 2020, the husband does not assert any debt owing to his father.
The husband's father, Mr E, provided an affidavit sworn 29 January 2020. He gave evidence and was cross-examined. He deposes to various 'deals' with his other two sons in terms similar to that claimed by the husband in respect of his land. The husband's father then deposes as follows:
22. Again, similar to my other sons, Mr Galena of I commenced discussions regarding the transfer of the block of land situated at B Street, Town C.
23. As result of my discussions with Mr Galena, in around mid-2008 I transferred the agreed land to Mr Galena for no purchase price, on the condition that Mr Galena would pay me the sum of the value of the land at the time of transfer when the property is sold or transferred.
…
26. It is my understanding that Mr Galena is currently seeking to achieve a property settlement with Ms Galena, and therefore Mr Galena may sell the property or transfer the property to another owner. As such, I will seek that Mr Galena pay to me all monies owed as agreed in around mid-2008.
Mr E was cross-examined. It was put to him that his son Mr Galena says that he owes Mr E $100,000? Mr E responded with “Yes, it was agreed between my wife and my sons”. His evidence in the witness box, contrary to his own affidavit, had his late wife as to a party to the ‘deal’ on the advancement of the land.
Mr E disclosed in his evidence that he is an undischarged bankrupt. He agreed that he had not disclosed this alleged debt from his son in his bankruptcy. His response was, “No because it's not a real actual debt”.
On consideration and on balance, I am not satisfied that the husband has proven on the balance of probabilities his assertion of the alleged debt to his father in a quantum of $100,000 or at all. The transaction was not in writing. The husband's affidavit evidence is inconsistent between his affidavits as to the existence of the alleged debt. Mr E’s evidence is contradictory between that on affidavit and that given in court as to the alleged creditor. Taking all of these matters into account, together with the inconsistencies and unusually poor recollection of the wife, I am comfortably able to find that there was an advancement of land from the husband’s parents to the parties but that no liability provable in contract attaches to that transfer. That is, I am not satisfied that the parties are contingently indebted to the husband’s parents or at all. That being the case, however, the advancement of the land will constitute contribution ‘by or on behalf of’ the husband.
ANZ Residential Investment Loan
The parties agree that the husband obtained a loan in his name from the ANZ bank in about 2010 and in the quantum of $70,000. They agree that the current balance owing is $63,000. There is little agreement otherwise between the parties in respect of this loan. The husband says that he obtained it with the knowledge and consent of the wife. She says that she had no knowledge of the loan until after it had been taken out. She says that she then challenged the husband as to the reason for the loan and says at [26] of her affidavit:
I was concerned and angry at the time, but Mr Galena assured me it would be met and serviced and eventually absorbed by the family business. I did not revive (sic) any benefit from the loan and the money went straight to the business. This was prior to my receiving my inheritance.
In his trial affidavit at [99] the husband deposes:
99 I say in around 2010, Ms Galena and I obtained a Residential Investment loan from ANZ bank ('personal loan'). I recall the original loan equating to the sum of $70,000, which I note is attached to the mortgage of the B Street, Town C property. I annex and mark with the letter ‘I' letter to Mr Galena from ANZ Bank regarding Residential Investment Loan.
Contrary to the husband's affidavit at [99], the annexure to that affidavit makes it clear that the loan was taken out only by Mr E and not by the husband and the wife. Secondly, the annexure does not disclose what if any security was provided for the loan. The husband was unable to clarify this situation in the witness box.
Contrary to the wife claiming that the benefit of the loan went to the husband's brothers/family business, the husband claims that the proceeds of the loan were used for the purchase of motor vehicles, a family trip to the Country F ($35,000) and improvements to the home.
Significantly both parties seem to agree that such repayments that have been made have come from the husband's brothers rather than the parties themselves or the husband alone. In circumstances where the wife claims that the benefit of the loan went to the husband's family and where they are clearly making the repayments, the husband's denials of such benefit to his brothers are not assisted by him not putting his brothers on affidavit in respect of this issue. There is no evidence that either of his brothers were unavailable to provide an affidavit or give evidence. As such, in the sense of this dispute I feel able to take an inference consistent with the well-known decision in Jones v Dunkel[2] where whilst the failure of a party to call a witness does not necessarily give rise to an adverse inference being drawn, an unfavourable inference can be drawn if the evidence otherwise provides such a basis. The husband does not explain his failure to bring apparently corroborative evidence from his brothers. Consequently, I do draw an inference that the truthful evidence of the brothers would not have assisted the husband's case. Further, in circumstances, not satisfactorily explained, whereby the brothers have been meeting the instalment payments on the loan, I prefer the evidence of the wife that the loan was taken out unilaterally by the husband with the benefit of those monies going to his brothers. I intend, therefore, to put the remaining $63,000 into the property pool as an 'asset' in the form of a debt owing to the parties by the husband's family. In the circumstances of me finding that the husband acted unilaterally in respect of that loan and where the complexity and status of the family companies has not, in my view, been adequately explained or disclosed by the husband, such ‘asset' should properly sit on the husband's side of the ledger.
[2] (1959)101CLR298
2014 – husband’s family loan from the husband's mortgage – $50,000
In about 2014 or 2015 a sum of $50,000 was withdrawn from the husband's mortgage account and provided as a loan to the husband's family businesses. Unlike the above transaction, the wife appears to have had some knowledge of this advance to the husband's family businesses. The parties agree that $20,000 has been repaid. The husband's father acknowledges the remaining debt at [33] of his affidavit where he deposes:
To this day, I say that my business owes Ms Galena: the sum of $30,000. I believe Mr Galena is willing to assist in the discharge of this loan.
The husband's father, of course, from the witness box now says that at least some of his 'businesses’ are apparently in voluntary administration. There is no evidence as to whether this intrafamily loan was disclosed as a creditor of the business? The general consensus, however, is that for the purposes of section 79 of the Act, the parties have an asset in the sum of $30,000 being a balance loan monies owing to them from the husband's family. Again, I expect that there were no formal documents created to evidence this loan. As such, I intend to include the outstanding loan of $30,000 as an ‘asset' of the parties in the property pool.
The husband says in his evidence that he has no knowledge of how the wife utilised to sum of $20,000 repaid to her by the husband's family in part payment of the loan with the implication being that she may have used it for her own benefit. The wife gives an explanation consistent with her general management of the family finances including the paying of the husband's credit card liability. I accept the wife's evidence generally as consistent with her management of the family finances up until March 2019.
Property pool.
I am now able to find the property pool to comprise of the following and at values:
B Street, Town C
$420,000
Respondent's motor vehicle
$5000
Applicant’s cash at bank
$500
Applicant’s motor vehicle
$10,000
Furniture and contents – applicant
$5000
Outstanding loan to husband’s family
$63,000
Outstanding loan to husband’s family
$30,000
$533,500
Superannuation
Applicant wife – Super Fund D
$95,043
Respondent – Super Fund A
$233,470
$328,513
Liabilities
Mortgage on B Street, Town C
$113,000
Capital gains tax – provisional
$8000
$121,000
Assets
$533,500
Superannuation
$328,513
Total property
$862,013
Liabilities
$121,000
Total – net property
$741,013
Contributions
This is a relationship that began some 31 years ago. Neither party had any assets of significant value as at the date of commencement of the relationship.
Until 1996 and the birth of the parties’ older child, both the husband and the wife were employed. The wife then took on the role of primary parent and homemaker whilst the children were infants. The wife has otherwise been in employment. The husband has been gainfully employed throughout the relationship.
I am comfortably satisfied that the husband's parents gifted the parties a block of land at B Street, Town C on which they eventually built the former matrimonial home. I accept the wife's evidence that the property was valued at some $75,000 at that time. As mentioned above, I am not persuaded that there is an outstanding loan to the husband's father in respect of that property. The transfer of this land occurred in about 2008.
The wife received an inheritance in about 2013 or 2014 and in a quantum of approximately $122,000. Despite the parties believing that they were separated by this time, I am satisfied that the wife contributed her inheritance to the benefit of the parties and, as noted above, with specific benefits to the husband's family.
In about March 2019 the wife disclosed that she was in a new relationship. This caused to end the parties' financial arrangements which had continued since their physical separation in about 2012. The wife continued to live in the former matrimonial home with the parties' younger daughter. The husband lived in Darwin. The husband 'froze' his mortgage account. I accept that the husband continued to make payments to that mortgage in a sum of $800 per fortnight. I accept the wife's evidence that she attempted to meet or contribute to the mortgage during this period but her offers were rejected by the husband. Nevertheless, this remains a post-separation contribution by the husband.
The husband argues in his documents that the wife has made unilateral withdrawals from the mortgage account with such monies used for her own benefit. I do not accept this evidence where the wife is not challenged to any great extent and also where the wife is the far better historian.
As in any 30 year financial relationship, there have been a myriad of contributions of various types. Notably, was the advancement to the parties of a block of land in 2008 which now sits with the matrimonial home and at some value. The benefit to the parties of this gift is obvious. Secondly, the wife's inheritance in about 2013 has also been a valuable contribution. The husband’s post-separation contributions to the mortgage should also be given weight albeit where he has benefited himself in respect of his ownership of the property but where the wife has effectively had rent-free accommodation for almost 12 months.
Taking all these matters into account and attributing weight, noting the timing, quantum and use of the various contributions, I am of the view that, on the basis of contributions, the property pool should be distributed as to 51.5% to the wife and 48.5% to the husband.
Section 75(2) factors
Both parties are in gainful employment. The wife has an income near $60,000 per annum. The circumstances of the husband's employment with his family business are more vague but I am satisfied that he receives benefits as a part of that employment. Notably, the husband's superannuation entitlement has increased significantly since the separation and in his evidence to the Court he admitted that this element of his salary package had been emphasised of late.
The husband claims some health difficulties but no medical evidence was adduced to suggest any limitations on the husband's employability.
The wife has the responsibility for the parties' dependent child, Y, who is 15 years of age. The best evidence is that Y is pursuing later secondary education and hence is likely to be in the care of the wife for another two years. The husband pays maintenance as assessed for Y in a quantum of $138 per week. In all of those circumstance, I am of the view that there should be a further adjustment to the wife of 1.5% of the property pool on account of the relevant section 75(2) factors with weight on her responsibility for Y.
Conclusion
Neither party asks for a superannuation split and in this sense it is proposed that I deal with the property on a ‘one pool' basis inclusive of superannuation entitlements. In circumstances where the husband has apparently set out on a course to maximise his own superannuation entitlement with significant increases over the last couple of years, and where his own evidence suggests that he views his working life to be limited by reason of his health (although, again, no evidence was adduced to convince me of this fact) and where the husband's superannuation entitlement significantly exceeds that of the wife, I agree that the one pool approach with each party retaining his and her superannuation entitlements is appropriate.
Secondly, each of the parties wishes to retain the former matrimonial home. Whilst I accept the husband may have something of an emotional attachment to the property given the advancement of the land from his family, the fact is that the husband has for some time resided in Darwin. He works in Darwin. He gives no indication of an intention or desire to return to Tasmania. To the contrary, the wife and Y have remained in residence in that property. Y is entering a crucial time in her education. In those circumstances, I am of the view that it is proper for the wife to be given the opportunity to retain the former matrimonial home. If she does not wish to remain there or cannot finance a settlement on the husband then the husband will be given the opportunity to retain the property.
After consideration of both contribution and relevant s.75(2) factors, I am satisfied that the just and equitable settlement would see the wife returning 53% of the property pool and the husband 47%. The net value of the property pool is $741,013. The husband is entitled to 48.5% or value of $369,391. The husband will retain his superannuation ($233,470); outstanding loan from husband’s family ($63,000); outstanding loan from husband’s family ($30,000); and motor vehicle ($5,000) together with the capital gains tax liability of (-$8,000) giving him net property of value of $323,470 meaning a cash adjustment to him from the wife of $35,921.
I certify that the preceding sixty-two (62) paragraphs are a true copy of the reasons for judgment of Judge McGuire
Date: 12 March 2020
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Family Law
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Equity & Trusts
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Res Judicata
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