Gallagher & Gallagher
[2022] FedCFamC2F 18
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Gallagher & Gallagher [2022] FedCFamC2F 18
File number(s): DGC 4566 of 2020 Judgment of: JUDGE BURCHARDT Date of judgment: 21 January 2022 Catchwords: FAMILY LAW – PARENTING – Father seeking overnight time with 6 year old son – mother only agreeing if father addressing concerns over his alcohol use – orders made for overnight time contingent upon provision of clear hair follicle test.
PROPERTY – Dispute following 12 year relationship – wife seeking 55/45 – whether wife’s initial contribution acted as a springboard – husband’s endeavours to sabotage parties’ joint business - contributions assessed 52.5/ 47.5 in favour of the wife – wife having predominant care and responsibility for the child – 10% future needs adjustment – 62.5/37.5 division just and equitable.
Legislation: Family Law Act 1975 (Cth) Cases cited: Kowaliw & Kowaliw (1981) FLC 91-092
Stanford & Stanford [2012] HCA 52Division: Division 2 Family Law Number of paragraphs: 79 Date of last submission/s: 22 December 2021 Date of hearing: 22 December 2021 Place: Melbourne Counsel for the Applicant: Mr Sweeney Solicitor for the Applicant: MDL Law Counsel for the Applicant: Mr Kiernan Solicitor for the Applicant: Ian Brooks ORDERS
DGC 4566 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS GALLAGHER
Applicant
AND: MR GALLAGHER
Respondent
ORDER MADE BY:
JUDGE BURCHARDT
DATE OF ORDER:
21 JANUARY 2022
THE COURT ORDERS THAT:
Property
1.The property matter be adjourned to this Court for mention before Judge Burchardt on 31 March 2022 at 9.30 am.
Parenting
2.The mother have sole parental responsibility for the child X born in 2015 (“X”).
3.The mother is to notify the father in writing of any major long term decisions in relation to the child’s health and/or education and allowing the father time to comment on the same.
4.The child live with the mother
5.The child spend time with the father as follows:
(a)Each alternate weekend on Saturday between 10.00 am and 5.00 pm and Sunday between 10.00 am and 5.00 pm until such time as set out in Order 7;
(b)Such further times including Christmas Day and Boxing Day as the parties agree upon.
6.The father’s time with the child will increase 21 days after he produces a hair follicle test capable of showing results dating back at least three months which does not indicate excessive consumption of alcohol as follows:
(a)Each alternate weekend from 10.00 am Saturday until 5.00 pm Sunday.
7.The father does not consume alcohol in the 12-hour period before or at any time during his time with the child.
8.X spend time with the father from 10.00 am to 5.00 pm on Father’s Day
9.X spend time with the mother from 10.00 am to 5.00 pm on Mother’s Day
10.The parties are at liberty to remove X from the Commonwealth of Australia for a holiday on the following conditions
(a)Removal shall occur during the time that the party otherwise has care of X in accordance with these orders save with the written consent of the other party. The party is to respond to the request for written consent within seven days of the request being made. In the absence of a response the consent is deemed to have been given.
(b)The removing party give 90 days' notice to the other party of their intention to remove X.
(c)Not less than 30 days prior to the proposed trip the removing party provide the other party the copy of the return travel tickets, or if booked online a copy of the online booking details, and an itinerary at the proposed travel, including but not limited to, the following details:
(i)The addresses and land line telephone numbers of where X will be staying. and
(ii)A mobile number or an alternative number for the other party to contact X.
(d)The party with whom X is not spending time be at liberty to telephone or Skype two times per week, and the removing party facilitate all calls and requests for calls and any request for X to telephone the other party.
11.Both parties be at liberty to attend all of X's school activities including parent teacher interviews.
12.Both parties are entitled to receive and make arrangements to receive reports and other documents provided by X's school and to receive school photographs at their expense.
13.Each party provide the other with their mobile telephone numbers and email addresses and advise of any changes within 24 hours of the occurring. This form of communication is only to be used for emergencies in relation to X’s health including but not limited to hospital admissions and medical interventions.
14.That communications in relation to X otherwise occur by AppClose.
15.Each party shall without delay advise the other of any significant injury or illness suffered by X while in their care together with details of those treating him and by this Order each party is entitled to speak with and obtain reports from those Treaters.
16.Each party is entitled to receive school photographs at their expense.
17.The parties shall forthwith do all acts and things to enable renewal of the passport for X. The passport shall be held by the Wife.
THE COURT NOTES THAT:
A.Pursuant to ss.65DA(2) and 62B of the Family Law Act 1975, the particulars of the obligations these orders create and the particulars of the consequences that may follow if a person contravenes these orders are set out in Attachment A and these particulars are included in these orders.
B.If in any proceedings there are allegations of family violence and the provisions of section 102NA of the Family Law Act 1975 apply (see attached Family Violence Information Sheet), any unrepresented party will not be permitted to personally cross-examine the other party/parties.
C.Affected unrepresented parties may apply to the Commonwealth Family Violence and Cross-Examination of Parties Scheme (“the Scheme”) for representation but any such application must be made at least 12 weeks prior to the Final Hearing.
D.Further information about the legislation and the Scheme can be found at Part 4 of the attached Family Violence Information Sheet.
E.If section 102NA applies and a party becomes unrepresented after trial directions have been made, that party is required to promptly advise the Court.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym Gallagher & Gallagher has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE BURCHARDT
INTRODUCTORY.
This is a bitter dispute between parties who were in a relationship from 2008 to 2020. The most keenly contested part of the proceeding is the property dispute, although there are also some matters in dispute in relation to their child, X, who was born in 2015. The applicant wife seeks, in effect, that the parties' property be divided 70/30 in her favour, whereas the husband seeks a 55/45 division in her favour.
That is only half the story, however. The net effect of the wife's position would be to retain the former matrimonial home and the husband to receive a caravan and motorbike.
So far as parenting is concerned, both sides seek an order for equal shared parental responsibility. But the mother's position is that X should not spend overnight time with the father until a number of preconditions, arising from the father's alcohol abuse, are met. The father seeks orders for overnight time without qualification.
For the reasons that follow, I am going to order the parties be divided as to 62 and a half per cent to the wife and 37 and a half percent to the husband. I also propose to make same of the parenting orders that the mother seeks.
AGREED OR UNCONTROVERSIAL MATTERS.
The wife was born in 1972 and is employed in a position of office worker. She has also been an admin officer for the parties' business, B Pty Ltd (B Pty Ltd) for which she has been paid a salary. The husband was born in 1972 and is employed as a transport worker. It will be necessary to return to his employment prospects in rather more detail.
The wife bought a house and land package in 2006 at C Street, Suburb D, into which she moved with her daughter, E, in 2007.
As earlier indicated, cohabitation between the parties commenced in 2008.
The husband's four children, then aged from about 12 to 4, spent alternate weekends and other time with them. E lived with the parties for only a relatively brief period of time.
The husband received at or about the time of commencement of cohabitation a sum of approximately $10,000 from the outcome of prior first matrimonial proceedings. The parties then bought a property at F Street, Suburb D for $380,000 with a mortgage of $350,000. That property was sold in 2014 for $485,000 and the net proceeds re-applied towards the purchase of the former matrimonial home, which was bought for $650,000 with a mortgage of $575,000. The property at C Street, Suburb D was sold with a net outcome of $152,000 in 2017, of which about $118,000 was applied to sundry debts and purchases. The remainder was spent for the benefit for the family over the next three years.
The parties had bought the B Pty Ltd business in 2010 for $60,000, plus the cost of a truck. The husband worked for income predominantly, it would appear, as a sub-contractor for Company G. The amounts of money earned in that capacity were not insignificant, but there have always been high running costs. In April 2020, the parties engaged Mr H to drive nights with the Gallagher truck and the husband drove days. However, shortly thereafter in May 2020, the husband recommenced interstate work and drove for a number of employers, including Company J up until December 2020. His wages were initially paid into the Gallagher account.
In December 2020, the husband established a new business, K Pty Ltd (K Pty Ltd) and although he did not work thereafter for B Pty Ltd, he continued to be paid $735 per week by B Pty Ltd until 30 June 2021.
The husband bought a prime mover on 3 May 2021 and ceased work for Company J at that time. The prime mover cost approximately $70,000 and is fully financed. The purchase price of the prime mover was guaranteed not only by the husband in his own capacity but also, without the authority of the wife, that of B Pty Ltd. The husband withdrew $36,000 from the B Pty Ltd GST account on 18 December 2020, shortly after separation on 8 September 2020. It would appear to be uncontroversial that he paid about $22,000 of that to his lawyers.
He says he has repaid the rest one way or the other to B Pty Ltd. The wife abstracted $19,000 from the parties' redraw account in June 2021.
The proceeding has been marked by strenuous interlocutory fighting, including significant debates about discovery and the alleged intentions of the husband to drive the B Pty Ltd business into the ground. It should be noted that the husband has sent a number of text messages to various parties from time to time (see the wife's affidavit) in which he has both expressed an intention to seek to ensure that the wife receives nothing or as little as possible out of this property proceeding and has sought to undermine the operation of the B Pty Ltd business by substituting his own company and/or a different truck in place with Company G.
The wife is presently seeking to sell the business, a matter I shall return to when I deal with the evidence given at court.
THE PARTIES'S AFFIDAVITS.
Much of what the parties have said in their all too voluminous affidavit is covered in the agreed matters above. The wife has additionally, from time to time and most particularly in her trial affidavit, tendered photographs going to prove that the husband has been seeking to sell the truck and trailer owned by B Pty Ltd for nothing. She has also appended to her affidavit a lengthy list of alleged over-expenditure by the husband, both generally and more particularly in relation to his alleged excessive consumption of alcohol.
THE SECTION 11F REPORT.
This report was tendered as exhibit A1 by the mother. It traverses allegations made by the mother of family violence, which the father denied. It traversed the alleged excess alcohol use by the father, which once again the father denied. Details of the father's alleged excessive consumption of alcohol and its sequelae are contained in the wife's affidavits. It should be noted that X, when interviewed, noted that his parents were not friends because, "mummy doesn’t like daddy drinking beer." X also stated he felt sad when Mr Gallagher "drinks beer", although he stated, "but I haven’t seen him do it for a while." X reported himself being happy and safe with each of his parents.
The report went on to recommend time with the father once a fortnight on Saturday and Sunday from 10.00 am to 5.00 pm with, "overnight spend time to be congruent with Mr Gallagher having produced ongoing clear drug and alcohol testing "
THE EVIDENCE GIVEN AND SUBMISSION MADE AT COURT.
I appreciate that recitations of this sort may make tiresome reading. But it should be noted that this is a methodology which has enabled me over the time to produce timely judgments, and I find this process as being extremely helpful to me in formulating my conclusions. What follows is taken from my notes.
The Opening and Evidence of the Applicant
Counsel indicated that the question of a child support departure application was no longer pressed as the matter was in hand with the agency.
The wife seeks to retain the matrimonial home at a value of $950,000 with a mortgage of $581,000. The husband is to retain the caravan, valued at $85,000, and his motorbike, which had competing values of $15,000 and $21,000 respectively. The husband had previously wanted to retain the business but now does not wish to do so. The wife seeks to transfer her shares to the husband. The truck and trailer are to be sold. The husband has tried to hinder that process. L Valuer had given a very limited value to the business of $155,000 less loans of $26,000. The truck and trailer will sell for $230,000. The wife's Motor Vehicle 1 has a loan of $51,000, and the car is owned by the company. The husband can keep his Motor vehicle 2.
BAS is owing in the sum of approximately $54,999 and possibly a further $12,000 from the BAS statement in December 2021. Anything left over, the husband can have. The wife seeks an equalisation of superannuation. She now seeks sole parental responsibility in respect of X and to continue the current orders in respect of alternate weekends. Hair follicle tests have been ordered, but the husband has done nothing about it.
The wife was called and adopted her trial affidavit and financial statement as true and correct.
Cross-examination commenced with questions as to how the wife had been able to obtain the texts she had appended to her affidavit. The wife said that the husband left his Apple Watch in her son's bag, and she went through it, an explanation I found entirely credible.
The wife said she had bought her first home in 2007, as a single parent, in C Street, Suburb D. She bought the land and got a house built on it. It settled in 2007. She agreed that the land had cost $105,000 and the house $133,000. She had a mortgage of $230,000 and had equity of $8000. She lived with the husband at C Street, Suburb D. He obtained a settlement later that year in the sum of $9000. They were living together from May 2008 onwards. She does not remember the date upon which they bought the first property in Suburb D but agreed that C Street, Suburb D was rented thereafter. The rent covered the mortgage.
It was put by Counsel that this was not correct because it did not cover the rates and repairs, and the wife agreed that part of the expenses did come from other sources. She conceded that the husband built the pergola and did a side pathway. When it was put that he had helped topping up the mortgage on C Street, Suburb D, the wife said he never paid her board for living in her home. This was for a period of over 12 months. He changed the dishwasher. The tenants did the garden. The pergola cost about $1200. C Street, Suburb D was sold in 2017 with net proceeds of $152,000.
The wife conceded the husband had four children who attended each alternate weekend. She has an older daughter who was living with her and the husband for six months, and then he drove her away. She came back when she was about 18 or 19 for six months. The husband's two older children spent time with them until they were 18, and the two younger children ceased time much earlier. Both of them had cared for his children. She had been the primary carer of X. When it was put that the husband was the primary income earner, the wife said she was also an income earner. He brought his income through the business and drove the truck. She did the bookkeeping. She agreed that the matrimonial home was now valued at $950,000. She agreed that the business was a question mark.
The wife was cross-examined about her endeavours to sell the B Pty Ltd business. She was in negotiations about the sale of the business. The potential purchaser wants the truck and the trailer, but she says that they must pay more for the business as a whole. Offers are going backwards and forwards. They want the equipment, but she wants to sell the whole business. She is hopeful this will finish soon. The broker deals with Company G daily. The purchaser would have to do their own deal with Company G.
The wife was cross-examined about the $36,000 that the husband withdrew from the Gallagher GST account. She was aware that some monies had been paid back by the husband. Counsel put it that $24,000 of the $36,000 had been paid to the husband's solicitor. The wife noted that that is what the husband said. It appeared to be agreed that he had paid back $4000 in two tranches, although the evidence was slightly confusing. The wife said she was aware of claims that the husband had paid back additional funds but had not checked all of them. There had been so much shifting of money.
Cross-examination turned to the $29,000 allegedly spent by the husband from company funds on his own purposes in 8 September 2020 and 17 June 2021, being annexure I to the wife's trial affidavit. Counsel endeavoured to put it that this was in part consistent of the $735 per week paid to the husband between 8 September 2020 and 17 July 2021. The wife said she had not included that amount and that he spent the $29,000. Detailed cross-examination took place about the husband's expenditure and, indeed, that of the wife. It was put that the wife had borrowed $48,152 in September 2021 and replaced $37,631. The wife said she removed the Company G money weekly. As expenses come out as debits, she puts it back. This is to keep the company working. She pays the superannuation out of her personal money because there is not enough in the company.
Counsel put it that the reason the husband ceased working driving the B Pty Ltd truck was because of COVID and lockdown restrictions. The wife said that he had told her there was less work. It was put that the husband says there was not enough work for him and Mr H because of COVID. The wife again said that that was what he says. She has been told otherwise. Transport is busier than ever. Counsel put it that the husband did not want to be away from his family. The wife said that he had been saying for the last few years that he missed the big trucks. He wanted to get back on the road. Counsel asked how it was that the husband was paid $735 a week as a transport worker, and she was paid $430 as an admin officer when, previously, figures had been $900 and $215. The wife said he wanted to decrease his income and that what the husband said was not true. She agreed that, at separation, he was earning $750 a week, and she had $1100 a week, inclusive of her wage. She agreed that she had applied for an intervention order and excluded the husband from the home.
She agreed that the husband was working long hours. It was put that sometimes the husband was sleeping in the truck, and the wife said that that was what the job entails. He was living in a caravan. It is possibly true that he could not rent. Counsel put it that the husband had negotiated to start K Pty Ltd to obtain increased income. The wife conceded that this was the case but said she does not see why it was relevant. Counsel put it that the husband bought another truck to earn more funds and get a reasonable lifestyle, but she did not agree. He had stopped the Company J money going to B Pty Ltd.
In re-examination, the wife confirmed that the husband's four children came each weekend and school holidays. When asked about the sale of the business, the wife said, "The debts will come out of the sale of the business, but the Motor Vehicle 1 and Motor Vehicle 2 will not be sold."
The Opening and Evidence of the Husband.
Counsel indicated that the case outline had only been filed the previous day. The husband was in Sydney. He was no longer seeking the business which owns the truck and trailer. He seeks a fifty-seven and a half, forty-two and a half per cent division. The husband is happy that the wife keeps the home. There are negotiations underway through the broker, and the husband is prepared to sell the business. Each party should keep their cars. He indicated that he sought the parenting orders in the case outline.
The husband was called and adopted his affidavits are true and correct.
Under cross-examination, it was put that the relationship between the parties was acrimonious, and the husband said they did not get on too well. It was put that they are unable to communicate, but the husband said they did. When it was put that he trusted the mother to make decisions about X, the father said, "Not solely." He had not been present in Court on 12 August 2021, but he had read the orders made. He was aware that there was an order for hair follicle testing. This was when he read the orders. He knew about the allegations about his alcohol consumption. It is her assumption that he is a drunk. He challenges this. He said he had taken a hair follicle test, but it did not come through because there were insufficient amounts of hair taken. He had given it to his solicitor. He had to grow his hair, but it was not enough. It was taken from under his arm. He was unable to say which month this took place. The test will have to be redone. He forwarded proof he had taken the test to his solicitor.
The husband confirmed that he knew that property issues were before the Court. He set up a new company in December 2020. Following the separation, he went his own way. When it was put that there was no recent financial statement, he said, "That was the accountant's job." He knew child support was an issue. He had made two payments of child support in the last month and a further $400 on Monday. He denied being $950 in arrears. Child support payments are $42.50 a week. He is not in arrears. He has spoken to the child support agency, and they are fixing it up. His business is not making money. He has not been paid for three weeks. They (the agency) had contacted him, but he could not give the month. There was a significant amount outstanding, and they said there had been no payments since June, but he had been making payments. They were talking hundreds.
Counsel put it that the mother supported X since separation. The husband agreed but said the house is his also. Counsel put it the mother had done a good job. The husband said he could not tell as he was not there. X jumps into his arms and does not want to go home.
Counsel put it that, in February 2021, he had sought to retain the company. The husband said there had been three offers made, and they have been the same. He would have liked to have had the business. Counsel traversed the texts and emails in which the husband had boasted that he would “fuck the wife over”. He said these were private conversations. He had heard her give the evidence. He conceded saying the things recorded in the wife's affidavit at paragraph 52 (the texts showing his endeavours to minimise the wife's outcome in these proceedings). The business was his sole work. He was going to take off. These remarks were tongue-in-cheek and heat-of-the-moment stuff. They were just words. If he ruins her, it will ruin his son's life.
The husband conceded that he does want the matrimonial home sold. He has said he would keep the business and caravan, but it is the Judge's decision. The house will have to be sold. Counsel put it that he had only changed his mind to force the sale of the house. He said it was not the first time he had changed his mind about the business. Company G makes the decision. He was just thinking out loud in a private conversation, weighing up his options. He does not intend to slip back in with a new truck. Mr M (with whom the husband had communicated) is not Company G. He has said this, but that is it. He did not act on it.
The husband considered that he had bought a new truck. He bought it under the new company name and he just signed the paperwork. It was put that he had given guarantees on behalf of B Pty Ltd, but he said he signed under K Pty Ltd. He did not realise that he had pledged the security of B Pty Ltd. There was no reason for him to take over the shares in B Pty Ltd. He has already got one company all set up. She is not going to hold the truck against the business. He conceded that he had not released the wife from the guarantee. He said if he sells the caravan, he can pay out the truck. Once the business is dissolved, he has to refinance. He conceded that when the truck and trailer are sold, the company's debts will have to be paid, as will tax.
The husband noted the wife drives the Motor Vehicle 1 and he has the Motor Vehicle 2. They will have to discharge the Motor Vehicle 1 debt to get it out of the company. He is not allowed to contact Company G at the moment. He is employed by Company G, not the company. Company G is not interested. He has worked for them for 10 to 11 years. He is not able to say how much he had paid in legal fees (but his Counsel gave the details in a total of $32,000).
Counsel put it to the husband that the $32,000 had come from the company, but he denied this. He paid $22,000 to N and the rest was paid on insurance. Twenty thousand came from B Pty Ltd and he took out a loan of $10,000. He is also borrowing from his father and mother. He has another loan taken out last week to pay for the proceeding, which is paid to his lawyers. He could not say how much he paid for valuations. He paid for half the costs. He then paid $10,000 last week.
Counsel cross-examined about monies drawn on the company's account, but the husband said he used this for entertaining. Counsel put it that he paid $7500 in an Apple store, but he said he needed a computer. When asked about expenditure at the Hotel, he said these could be business meetings. Ever since the date he was told not to use the business account, he has not done so. She had told the child support agency he was in arrears when he was not. He said they used to go out to dinner two to three times per week. A lot came out of the business. He conceded that the wife had just built her house when the relationship started. He had not paid his former wife anything, but she had paid him out. He had to pay the costs of a car accident of more than $8,000. He had put money into Suburb D and they used C Street, Suburb D as a security.
Counsel cross-examined about the Facebook posts about the truck. He did put one on with the message "Free" so as to avoid workmates knowing the price. He had not put it on Facebook after the order.
When asked what contribution the wife had made to his own children, he said she was not a good mum to them. They looked after them. When it was put that the wife's solicitors were seeking to be paid $270 a week for dental treatment for X, the husband said he did not have the money.
There was no re-examination.
Final Submissions by Counsel for the Husband
Counsel submitted it was a twelve year relationship. They met in 2008 and cohabited, and separated on 8 September 2020. The wife seeks orders that she gets the family home, which has an equity of $368,000. She also wants to keep her Motor Vehicle 1, but have the debt paid from the sale of the trucks. If the wife's orders are made, the husband gets nothing apart from the caravan. He will still have the debt on his Motor Vehicle 2. It would approximate to an 85 or 90 per cent division in her favour. It was submitted that it was just not that sort of case. The husband seeks 57.5 to 42.5 per cent. There will not be a large discrepancy in earnings. The husband is a transport worker. The small asset pool reflects the parties' low earnings. The wife is the primary carer for X and an adjustment under section 75(2) would be appropriate. So far as contribution issues were concerned, the wife had bought C Street, Suburb D in 2007, but it was sold later for $152,000. So there was very limited equity in C Street, Suburb D at the commencement of approximately $8,000, which would not have increased much more by 2008. The husband had not had the primary care of his four children and the wife's child had been there for two years of the relationship. He conceded that each party did their best. The husband was employed throughout. Counsel queried whether this was a wastage case and said this was not a Kowaliw & Kowaliw (1981) FLC 91-092 case. The husband is not seeking the sale of the home if the wife can pay him out. If she cannot, the property must be sold.
So far as parenting is concerned, the husband sought to continue the current regime, but once a hair follicle test is taken, then he can move to overnight. There could be further nights when the husband has re-established himself.
Final Submissions by Counsel for the Wife
Counsel submitted that the wife's evidence had been explicit. From paragraphs 106 to 116, she had detailed the husband's alcohol difficulties. There had been no cross-examination about parenting issues. The husband lapses into drinking after periods of sobriety. He has not undertaken hair follicle tests and cannot even tell what month he took his test. Sole parental responsibility had always been an issue.
Turning to finances, Counsel submitted that the husband had given no new financial statement and no information about his new business or his earnings. The old business earned $127,000 in 2020, but he set up another company and had given personal and B Pty Ltd guarantees. The wife had not been removed from the guarantee and the husband should have the business. The husband's conduct was consistent with his emails. Once the business is sold, the husband can slip another truck in. The husband had been undermining the wife's efforts to sell the business as indicated in paragraph 46(f) of her trial affidavit. The current offer is $230,000 and the wife wants $290,000. The $230,000 would pay everything out except possibly tax. The husband is in arrears of child support.
The caravan is worth $85,000 and the Motorbike is worth either $15,000 or $21,000 as the wife asserts. So far as the Motor Vehicle 2 is concerned, the payout figure still gives an equity of $13,500. The husband's legals are paid. The wife would get her car and her home. Counsel pointed out that there was so little to divide. He referred to authority in this regard. The wife does not earn what the husband earns. The $569 she receives from the company each week will not continue when the business is sold. The ownership of C Street, Suburb D had been a springboard.
The wife has cared for X since separation. She is paid very small child support and the child is only six. She is seeking a 70/30 division, but in any event, she needs a home. The husband is to keep his shares in the company, as he has not removed the guarantee.
In submissions in reply, Counsel pointed out that there were no allegations of untoward behaviour by his client while X has been in his care. The regime has been in place for a long time and this is not a major move to overnight.
Some Very Brief Observations about the Witnesses.
The wife struck me as being a good witness in that she was direct and responsive to questions put. She was wholly unable to conceal the very considerable personal bitterness that she feels towards the husband. Given the messages he has sent from time to time, which he was feckless enough to allow her to access, this bitterness is readily understandable. It has undoubtedly infused the proceeding more generally and is reflected in the numerous interim stoushes that the parties brought.
The husband struck me as being relatively straightforward as a witness, but some of his lack of recall was quite astounding. He was unable, merely by way of example, to remember when he had endeavoured to take his hair follicle test. Given that the orders for him to do so were only in August and that there must have been some delay while his hair was attempted to be grown, his failure to recall in December which of September, October and November, or even December, the test had been taken was quite extraordinary. He presented as a very simple person. He presented as being generally extremely unsophisticated.
PARENTING ISSUES
The first matter in issue is the question of parental responsibility. The wife has deposed to family violence and was not cross-examined. Accordingly, I am obliged to find on the unchallenged admissible evidence of the wife that family violence did indeed take place as she alleged from time to time during the relationship. This, of course, means that the presumption as to equal shared parental responsibility is rebutted.
The husband himself conceded, as the wife indeed herself alleges, that communication between the parents is execrable. The relationship between them was and still is extremely acrimonious. Realistically, the wife has exercised sole parental responsibility since separation. I propose in the circumstances to make an order for sole parental responsibility as the mother seeks, but require her to give proper notification to the husband of any major decisions and take any views he expresses into account.
The Spend Time and Communicate Regime
This not a case where it is necessary to traverse each of the primary and secondary considerations seriatim. That is because the dispute between the parties is, in essence, a very limited one. The wife seeks orders that X spend time with the father on each alternate Saturday between 10.00 am till 5.00 pm, and each alternate Sunday between 10.00 am and 5.00 pm:
until such time as he has provided an alcohol hair follicle test which does not indicate excessive consumption of alcohol when the time will increase to 10 am Saturday to 5pm Sunday provided that he also provided a certificate of satisfactory completion of the alcohol rehabilitation course.
She also seeks a further order that the husband does not consume intoxicating liquor in the period of 12 hours before or at any time during his time with X.
Somewhat was said by Counsel for the wife in final submissions about the undesirability of the father retaining to his own discretion the question as to when this sort of test should be undertaken. In substance, however, everybody seems to agree that if the father can stay off drink, then time should from be from Saturday to Sunday night.
I accept that there is room for trenchant criticism of the husband's conduct in this regard. His evidence about his having endeavoured to take the hair follicle test was unconvincing, and his incapacity to remember when it took place is, as I have indicated, quite extraordinary. In the end, however, the bridge must either be crossed or not. I have no doubt that the husband will continue to consume alcohol. He has not said, even in the most passing way, anything to indicate that he proposes to address his significant alcohol dependency difficulties. I note that it is his position that he does not drink to excess but this is simply inconsistent with the wife's unchallenged relevant evidence. Furthermore, it flies in the face of what X had to say to the 11F reporter.
Bearing in mind that he will continue to drink, what is one then to do? X is not scared of either of his parents, as he told the 11F reporter, and is happy with both his parents. The 11F report indicated that overnight time should be, "Congruent with Mr Gallagher having produced ongoing clear drug and alcohol testing."
The order that the mother seeks, making time contingent upon completion of a rehabilitation process by the father is simply not a practicable one. I am going to order that the father's time increase to Saturday night over time some 21 days after he produces a hair follicle test capable of showing results dating back at least three months. The 21-day period will give the mother time to come back to Court if there is any dispute as to the validity of the test. I will further make the order imposing the restraints on alcohol consumption before and during the spend time regime in any event.
PROPERTY - STANFORD & STANFORD [2012] HCA 52
The Court's first task is to ascertain the legal and equitable interests of the parties in determining whether a property adjustment is appropriate. However, in this case both parties seek that there be a property adjustment and it is clear that both of them regard it as just and equitable that an adjustment be made even though what they seek is radically different.
The Pool
The aspects of the pool seem to me to be (all agreed save for (g) and (h),
(a)the former matrimonial home, $950,000;
(b)caravan, $85,000;
(c)Motorbike, $15,000 (taken as a concession against interest);
(d)husband's Motor Vehicle 2, $64,000, encumbered as to $50,379;
(e)wife's Motor Vehicle 1, $51,150, encumbered as to $51,568;
(f)funds taken by the wife from the redraw fund, $19,622,
(g)$26,000 of the $36,000 withdrawn by the husband from the GST account (see paragraph 69 below)
(h)B Pty Ltd funds used by the husband to operate his own business, December 2020–June 2021, $14,000 (see paragraph 70 below)
The mortgage on the property is agreed to be worth $581,537.
The wife's superannuation is worth $90,388 and that of husband is worth $155,890.
The first area of disagreement is the $36,117 withdrawn by the husband from the GST account on 18 December 2020. It is conceded that $22,000 of this was applied by the husband to his legal costs. The husband has says that he repaid about $10,000 of this to the B Pty Ltd Company account and otherwise to the benefit of the company. This aspect of his evidence was the not the subject of any significant challenge in cross-examination so far as I can recall. I will include therefore the $26,000 that the husband withdrew and did not repay.
The wife also seeks the inclusion as wastage in effect of $29,831, being the figures referred to in annexure I to her trial affidavit. It is hard to know quite what to make of these kind of schedules. Many of the expenses seem to me to be, on their face, legitimate expenses arising out of the operation of the traveling that the husband necessarily had to do in his work as a transport worker. Nonetheless, of course, these were monies spent on the operation of his own business, following cessation of his work for Company J in December 2020. Doing the best I can to make sense of what, on any view of the matter, is a somewhat confused picture, I note that at least $5600 of the expenses which were private involved Mr Gallagher buying a new computer, something which in my view was reasonable in the circumstances. Doing the best I can amidst a welter of entries and assuming, with the exception $5600, a reasonably lineal, so to speak, and continuing expenditure, bearing in mind that this was a 10-month period in total and therefore expenses of approximately $2400 a month (bearing in mind that I have decreased the $29,800 by $5600). I will included a rounded off total of $14,000 under this hearing. This reflects the approximately 6 months during which the husband was operating his own business and still using the funds of B Pty Ltd to do so.
Contributions
One of the more off-putting aspects of this unfortunate case has been the degree to which each side has striven to make mountains out of mole hills in their endeavours to ensure that they get as much as possible and the other party gets as little as possible out of the property settlement. The amount of care given by the wife to the husband's children was not enormous but was certainly of some benefit to him and the same, it must be said, is true of such care (which I suspect was very little given that he says he was working long hours and hard at that) in respect of the mother's child. In my view what they did in this regard falls fairly and squarely into the warp and woof of the weave of any marriage and is part of a process whereby both of them generally did their best. There seems little doubt that the husband's excessive alcohol consumption must have made something of a drain upon the parties' finances from time to time and I note that his evidence, which was effectively unchallenged, was that they were slightly extravagant in their lifestyle (eating out numerous times each week). Indeed, one of the striking aspect of the parties' finances is that they never seemed to get ahead. Their properties always, remained very significantly encumbered and it is difficult to avoid the impression that these were parties who spent as they earned. They both continue to drive more expensive cars than one might have expected given their incomes.
Having said this, the wife has worked throughout as well as being the primary carer for X but the husband at all times made more money than she did. The fact that this was then split through the business in tax advantageous ways (which unpleasantly make also have diminished the husband's child support to his first partner) is just part of the overall scene.
While I have referred to the possible diminution of funds arising from the husband's alcohol consumption, I do not think it rises in the scheme of things to a Kowaliw case as Counsel for the father has correctly submitted. This is a relationship of some 12 years. The parties did undoubtedly benefit to an extent from the fact that the wife owned a property at commencement. True it is that there was but little equity but it seems clear to me that, as the wife says, this was part of the security which enabled them to obtain their first matrimonial home. Calibrating all of these matters together is a matter of assessment and weight and in my view the contributions should be assessed 52-and-a-half per cent to the wife and 47-and-a-half per cent to the husband, reflecting both her initial contribution (and I have not ignored the husband's very small one) and the benefit that C Street, Suburb D ultimately represented, albeit that it appears to have been somewhat frittered away.
Future Needs
Although there is suggestion in the materials that both of these parties may have some ongoing mental health issues these have not been given any prominence. They are roughly the same age and appear to be able to continue working for the foreseeable future. The wife will not make as much once the business is sold and in my view her income will always be smaller than the husband's.
There is no doubt that the wife will continue to have the predominant care and responsibility for the upbringing of X for a long time come. This in my view is the decisive consideration. In my view she should obtain a loading of 10 per cent in this regard.
Other Matters
One of the matters in issue between the parties is what is to happen when the business is sold. In the end, while this is anomalous in that it is the wife who is selling it and the husband who has historically always wanted it, the position in my view is clear. The husband has, on what must be described as a frolic of his own, encumbered the business by giving a guarantee not only his own behalf but on behalf of B Pty Ltd. Whether this gives rise to any direct cause of action as against the wife personally, of course, is very open to doubt. There is nothing to suggest that B Pty Ltd has been trading while insolvent and the guarantee can not go further than such property as B Pty Ltd itself owns. Nonetheless, to the extent that this guarantee gives rise to any kind of contingent liability it is plainly just and equitable who bears it. I will order that the wife's shares be transferred to the husband upon the sale of the business, whether that is simply its chattels and/or such additional good will as the wife is able to persuade the purchaser to buy. The matter not addressed by either party is whether the party having the benefit of the guarantee should be given notice of the share transfer.
The wife seeks that her Motor Vehicle 1 car be paid out of the sale of the business but that the husband retain his car which is encumbered very substantially. I have observed in passing that the fact that both these parties want to drive such expensive cars when their overall property holdings are so limited only goes to reinforce the remarks I have earlier made about the parties' approach to finances generally. They are living beyond their means. In my view there is no reason why the Motor Vehicle 1 and its debt should not both be taken by the wife. If she wishes the debt to be paid out of the sale of the business, then it will nonetheless count as part of her share of the pool.
Superannuation
As I understand it both parties agree there should be an equalisation of superannuation and that this, as it were, stand alone rather than be included as a part of the overall percentage division between the parties.
CONCLUSION
This is a messy case. Discovery is incomplete. Many of the schedules that the wife in particular has prepared are not, at least to me, easy to fully construe. It is plain that a final conclusion cannot be brought to the matter until the business is sold and its outcome is ascertained. There is after all still tax to be paid. I will hear from the parties before making orders to progress the property component of the matter.
I certify that the preceding seventy-nine (79) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Burchardt. Dated: 21 January 2022
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