GALLEGO & MACKWETH

FAMILY COURT OF AUSTRALIA

GALLEGO & MACKWETH

[2018] FamCA 787

FAMILY LAW – PROPERTY – Undefended hearing – Application for case guardian dismissed – Non-disclosure – Mental Illness – Where the husband’s conduct has delayed the proceedings – Where the wife has incurred significant legal fees to finalise the proceedings – Findings unable to be made due to non-disclosure – Contributions of the wife impacted by family violence – Where the husband has received significant funds post-separation – Where the wife will have sole responsibility to support children.

Family Law Act 1975 (Cth)

Britt v Britt (2017) FLC 93-764
Chang v Su [2002] HCATrans 446
Inthe marriage ofWeir and Weir (1993) FLC 92-338
Mackworth & Gallego [2017] FamCAFC 261
Medlow & Medlow (2016) FLC 93-692
Zane & Allan (2008) FLC 93-378

APPLICANT:

Ms Gallego

RESPONDENT:

Mr Mackweth

FILE NUMBER:

SYC

3015

2012

DATE DELIVERED:

27 September 2018

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Stevenson J

HEARING DATE:

22 August 2018

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Schonell SC

SOLICITOR FOR THE APPLICANT:

Diana Perla & Associates

THE RESPONDENT:

There was no appearance by or on behalf of the respondent

Orders

The husband and wife forthwith do all acts and things and sign all documents necessary to direct AB Lawyers, solicitors, to pay to the wife, the total proceeds of the controlled monies account which they hold on behalf of the husband and wife.
In the event that the husband fails to sign the direction provided to him by the wife's solicitor within 48 hours of such provision, the Registrar of this Honourable Court is authorised to sign the direction on his behalf, pursuant to section 106A of the Family Law Act 1975 (Cth).
Other than as ordered herein, the wife is declared the sole owner of the following property to the exclusion of the husband:
3.1the property at BC Street, Suburb E, New South Wales
3.2her superannuation with the Public Sector Superannuation Scheme
3.3jewellery in her possession
3.4furniture and household effects in her possession
3.5any motor vehicle in her possession
3.6all other personal property, monies, bank accounts and superannuation entitlement in her possession and/or under her control
Other than as ordered herein, the husband is declared the sole owner of the following property to the exclusion of the wife:
4.1any real property registered in his name
4.2jewellery in his possession
4.3furniture and household effects in his possession
4.4any motor vehicle in his possession
4.5all other personal property, monies, bank accounts and superannuation entitlement in his possession and/or under his control.
The wife will indemnify the husband in relation to all debts and liabilities in her name (or jointly with any other person or entity).
The husband will indemnify the wife in relation to all debts and liabilities in his name (or jointly with any other person or entity).

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 Gallego & Mackworth has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 3015 of 2012

Ms Gallego

Applicant

And

Mr Mackweth

Respondent

REASONS FOR JUDGMENT

The proceedings

Ms Gallego and Mr Mackweth have been parties to litigation in relation to parenting and property settlement issues since 2012. The parenting proceedings finally concluded on 8 December 2017, when the Full Court dismissed the husband's appeal against Orders made by Rees J on 20 January 2016 ([2017] FamCAFC 261). The Orders provided, in summary, for the children D, born in 2006, and B, born in 2009, to live with the wife and spend no time with the husband. These Orders also provided that the wife has sole parental responsibility for the children.
The parenting aspect of the litigation proceeded to hearing before Rees J in November 2015 and the matter was then adjourned part-heard until 19 January 2016 in relation to the dispute as to property settlement. The husband did not appear on 19 January 2016. The husband's mother, Ms G Mackweth (“the husband’s mother”), forwarded to the court a letter from a psychiatrist, Dr Y, which stated that he was unable to provide instructions to his lawyers. The property proceedings were adjourned to enable the wife to consider her position in relation to the appointment of a litigation guardian for the husband.
A chronology of procedural events, including various agitations by the husband and/or his mother for appointment of a case guardian, was set out in a document headed "Applicant Summary of Argument re appointment of case guardian and adjournment of proceedings" prepared by senior counsel for the wife. This chronology read as follows:

Date	Event
1.	18 January 2016	[The husband’s mother] writes to Justice Rees stating Husband is unable to give clear instructions, that the proceedings are too complex for her to be appointed Case Guardian and enclosing letter from Dr Y.
2.	19 January 2016	Hearing for Property Proceedings adjourned. Husband does not appear. Matter adjourned to 18 February 2018 to see if matter can be progressed in relation to appointment of Case Guardian.
3.	19 January 2016	Email from [the wife’s solicitors] to [the husband’s mother] re resolving the issues and requesting family member be the Case Guardian.
4.	29 January 2016	Further letter from [the wife’s solicitors] to Husband, [the husband’s mother] and family re: Case Guardian.
5.	17 February 2016	Husband files Notice of Appeal re parenting matter.
6.	18 February 2016	Mention before Rees J. Husband does not appear. Orders that wife to approach NCAT for an appointment of a Financial Manager to be a Case Guardian.
7.	16 March 2016	Husband files Application in Appeal seeking a Case Guardian in the Appeal matter and that no member of his family can be a Case Guardian.
8.	31 May 2016	Husband and [the husband’s mother] file Affidavits in Appeal consenting for [the husband’s mother] to be the Case Guardian in the Appeal.
9.	1 June 2016	Minutes of Order signed by [the husband’s mother] appointing her as Case Guardian in property proceedings as well.
10.	7 June 2016	[The husband’s mother] writes to the Court that she cannot be Case Guardian if Rees J is the Judge.
11.	20 June 2016	Parties informed that Stevenson J is now the Judge and matter listed before her 28 June 2016.

12.	24 June 2016	Notwithstanding that Rees J stood down as Judge, [the husband’s mother] sends email to Stevenson J stating that she cannot be Case Guardian for the Husband in the property matter.
13.	28 June 2016	Mention before Stevenson J. Neither the Husband, nor [the husband’s mother] attend. Orders that the Wife to make an Application to NCAT.
14.	1 September 2016	Further letter from [the wife’s solicitors] to [the husband’s mother] requesting updated reports from Dr Y and asking her to be Case Guardian for the property matter or would his sister, Ms Q consider it?
15.	16 September 2016	Wife applies to NCAT for the Appointment of a Financial Manager for Husband.
16.	February 2017	Hearing before NCAT for the Appointment of a Financial Manager for Husband. Application dismissed.
17.	30 March 2017	Wife files Application in a Case before Her Honour, Justice Stevenson, to relist the matter for Property Hearing
18.	30 May 2017	Mention before Stevenson J re: Wife’s Application in a Case. Husband attends and represents himself. The matter is adjourned.
19.	12 July 2017	Further Mention before Stevenson J. Husband appears and represents himself. The property matter is adjourned until after the Appeal is heard.
20.	14 November 2017	Parenting Appeal heard. Husband appears and seeks to discharge [the husband’s mother] as Case Guardian and runs the Appeal himself without the assistance of a Case Guardian
21.	21 February 2018	Mention before Stevenson J. Husband does not attend and emails a basic Medical Certificate from a GP. Her Honour makes Orders for filing of Financial Statements and exchange of disclosure by 28 March 2018.

22.	28 March 2018	Mention before Stevenson J. Husband does not appear and does not file his Financial Statement nor has he made arrangements for exchange of disclosure documents in accordance with Orders of 21 February 2018.
23.	16 April 2018	Mention before Stevenson J. Husband does not attend. The matter is listed for an Undefended Hearing on 23 May 2018.
24.	17 August 2018	Husband files application to adjourn the Hearing and seeks [the husband’s mother] to be Case Guardian.

Ultimately, the wife's application in respect of financial issues was listed for undefended hearing on 22 August 2018. On 20 August 2018 the husband filed an Application in a Case, by which he sought an order "That the property hearing listed on 22 August 2018 is to be adjourned". On 20 August 2018 the husband filed a document entitled Response to Initiating Application, by which he sought the same order for an adjournment in slightly different terms as set out in the Application in a Case.
On 20 August 2018 the husband filed an affidavit of some 33 paragraphs. This affidavit was a duplication of an affidavit filed on 17 August 2018, and sworn on 14 August 2018. A further affidavit was filed on 21 August 2018. The husband states in both affidavits that his mother assisted him in writing the affidavits, and that both affidavits were settled/prepared by him as the deponent.
On 21 August 2018 the husband's mother forwarded to the court an affidavit and report dated 14 August 2018 from Dr Y. In an accompanying email she stated "We will be relying upon this report to support [the husband]'s case for a case guardian and to adjourn the property hearing". This affidavit and report were also filed with the court on the same day.
On 21 August 2018 the husband’s mother forwarded to the court an "Outline of Case file on behalf of the husband" accompanied by an email which stated "[t]he husband will not be attending for reasons outlined in his submissions". The author of the written submissions was not identified in the document. This document was also filed with the court on 22 August 2018.
Affidavits of service were filed on behalf of the wife which indicated that the following documents were provided to the husband in accordance with directions made on 16 April 2018:
1.        Affidavit of the wife sworn on 9 July 2018 and exhibits thereto
2.        Financial Statement of the wife sworn on 26 March 2018
3.        Market Assessment of the property BC Street, Suburb E
4.        PSS 2016/2017 Annual Statement Pack
5.Schedule of claim payments for the husband between 13 November 2012 and 25 September 2015 from RS Insurance subpoena
6.Various documents by way of disclosure by the wife, for example, tax assessments, ANZ Home Loan statements, credit card and bank statements
7.Minute of Orders sought by the wife
8.Outline of Case document on behalf of the wife, balance sheet and financial chronology.
Despite the filing of his Case Outline document that morning, the husband did not appear in person or by a legal representative on 22 August 2018. Senior Counsel for the wife opposed the husband's written application for an adjournment, which I refused, and the hearing of the wife's application proceeded on an undefended basis. I indicated that I would set out my reasons for this ruling in my judgment and I now do so.

The husband's application for an adjournment of the hearing in relation to property settlement

It was submitted on behalf of the wife that the husband's application was merely “a delaying tactic" and that the present agitation for appointment of a case guardian is consistent with similar attempts by the husband and/or his mother in the past. Senior counsel for the wife pointed to the fact that the husband sought a discharge of the order by which his mother was appointed case guardian in the appeal on 14 November 2017. That order was discharged and the husband then proceeded to argue the appeal himself. The Full Court observed that:
17. The father engaged with the appeal issues appropriately. He was polite, responsive and, when asked, he was able to take us to relevant pages in the appeal books. In short we are satisfied that the father was able to conduct the appeal and the order discharging his case guardian did not operate to his disadvantage.
In his affidavit of 14 August 2018 the husband indicated that he seeks that his mother be appointed case guardian in the property proceedings, "subject to a lawyer being instructed on my behalf". The husband indicated further that he sought the release of a sum of $35,000 from a controlled monies account for payment of legal fees for that purpose. This account has a current balance of approximately $318,000, being net proceeds of sale of the parties' former matrimonial home.
Senior counsel for the wife submitted that "there is no guarantee that [the husband's mother] would remain in the proceedings" if she were appointed as case guardian. I accept that proposition, given the history set out above and the consequent inordinate delay in the finalisation of the property proceedings.
As previously referenced, Dr Y swore an affidavit on 21 August 2018, which annexed a report dated 14 August 2018. This affidavit was witnessed by Ms Q Mackweth who is the sister of the husband.
The report of Dr Y responded to seven questions, which purportedly were submitted to him by the husband’s mother as follows:
1.        You have previously mentioned that [the husband] is able to manage his day to day finances and does not require a financial guardian. In your opinion, what is the difference between managing his day to day finances and compared to [the husband] running a Family Court proceeding?
2.        In your opinion, is [the husband] able to run a Court proceeding on his own competently?
3.        Does [the husband] require a guardian to assist him in giving instructions to a lawyer in order to run a Court proceeding competently?
4.        If you do not think [the husband] is able to run a Court proceeding on his own, will the assistance of a lawyer allow him to run a Court proceeding competently?
5.        If [the husband] was to be summoned as a witness in Court, will he be able to give an accurate account of historical and current finances?
6.        If any, what are the factors or symptoms of [the husband]'s illness that impede him from running a Court proceeding on his own?
7.        If [the husband] was to run a Court proceeding on his own, what are the impediments if any, in impeding him from running the proceeding competently?"
At face value, the fluency of these questions does not sit comfortably with the husband's evidence as to his mother's capacity in the English language. The husband deposed in his affidavit of 14 August 2018:
23. [Ms G] was born in [the Middle East] where she had only studied in Arabic and French. She is not proficient in English as she had never been to school in Australia. She takes an enormous amount of time to read and write accurately and she is not able to speak English fluently let alone conduct a hearing or cross examination in court. On the day of the appeal hearing in November 2017, I had to read the submissions out myself as [Ms G] advised the judges that she would take a very long time to read and articulate herself. In the end, the judges consented that I could read the submissions out myself. My mother and I had been working on the material for numerous months and the Appeal hearing has lasted less than 2 hours in [Ms G's] recollection."
In his report of 14 August 2018 Dr Y stated inter alia as follows:
(7) Regards impediments for [the husband] to present his case, to respond to the "other side", I believe that [the husband]'s symptoms will mean that he will be severely disadvantaged because of his incapacity to properly cognitively function, intolerance of severe anxiety, and thus, experience difficulty to formulate analyses and opinions, to be able to respond to other arguments and assertions, create counter arguments, understand the nuances and implications of the many matters that will be discussed in the Court. All these matters have to occur, I believe, within a limited amount of time that the Court has allocated for the matters to be heard. This creates very much stress on a person suffering from the proneness to have severe, dysfunctional, are (sic) stress reactions. As stated previously, his severe anxiety, which would be likely to worsen, would be likely to result apart from being cognitively ineffective, to react in a way that would be too (sic) psychologically withdraw and isolate, i.e. "shutdown". This would prevent him from preventing his case, defending himself, asserting his perspective, competently.
As submitted by senior counsel for the wife, the case outline on behalf of the husband appear to have been prepared by a person with knowledge of the law. The written submissions contained therein include references to the Family Law Rules, a case known as Zane & Allan (2008) FLC 93-378 and legal concepts such as "non disclosures by the husband" and "a fair and equitable decision". A further example appears in a submission concerning the value of the Suburb E property, as follows:
"... There is no recent valuation being tendered in as evidence regarding this property. I understand [the wife] has tendered a property appraisal made by [EF] Partners Real Estate agent. This is not an independent valuation. They have in fact stressed that it is an opinion and not a sworn valuation. There is also a conflict of interest in obtaining a property appraisal from [EF] partners as they are the managing agent for this property. They had in fact listed this property for rent in July 2017."
The tenor of these written submissions suggests to me that the husband in fact has access to advice from a person with some knowledge of the law. It would seem that the husband and this person have elected to devote their efforts to achieving a further delay in the finalisation of the property proceedings, rather than preparation for trial.
It was submitted on behalf of the wife that the husband failed to satisfy the court that an order for payment to him of a sum of $35,000 would be capable of being reversed on a final hearing. Reference was made to the remarks of the Full Court in Medlow & Medlow (2016) FLC 93-692 (“Medlow & Medlow”) at 81,090 as follows:
85.We commence by referring to the following passage in Strahan at 85,646:
139.We also emphasise that in order to establish an appropriate case for an interim property settlement order more is required than the mere fact that upon a final hearing the applicant would receive the property being sought (or an amount in excess of the funds being sought) from the other party.
86. The onus was clearly upon the husband to establish that there were sufficient assets available for the interim distribution and that the effect of any interim order was capable of being reversed as part of the final hearing or at least would not defeat the wife's property claim. The onus was not on the wife to adduce such evidence."

Inter alia, the wife sought an order by way of final property settlement that she receive the whole of the funds held in the controlled monies account. The husband filed no evidence as to the extent and value of the net pool of property and gave no indication of the orders which he proposed to seek by way of property settlement on a final basis. At no relevant time has the husband filed a Financial Statement.
In these circumstances, I am satisfied and I find that the husband failed to discharge the onus which rests upon him as set out above in Medlow & Medlow. Accordingly, I will not order that the husband receive a sum of $35,000 from the controlled monies account.
Given that there will be no such order, no good purpose would be served by the appointment of the husband's mother as his case guardian in the property proceedings. The most likely result of such an order would be a further delay in finalisation of the property proceedings, too much of which has already been inflicted upon the wife.
For all of these reasons, I did not adjourn the hearing of the wife's application for orders for alteration of property interests. Ultimately, it seemed to me that justice required that no further delay and expense be inflicted upon the wife.

The application for orders for alteration of property interests

At the hearing on 22 August 2018 the applicant wife sought the following orders:
1.That the Husband and Wife forthwith do all acts and things and sign all documents to direct [AB Lawyers], solicitors, to pay to the Wife, the total proceeds of the controlled monies account that they hold on behalf of the Husband and Wife;
2.That in the event that the Husband fails to sign the direction provided to him by the Wife's solicitor within 48 hours of such provision, that the Registrar of this Honourable Court be authorised to sign the direction on his behalf, pursuant to section 106A of the Family Law Act;
3.That other than as ordered herein, the Wife be declared the sole owner of the following property to the exclusion of the Husband:
3.1The property at [BC Street, Suburb E], New South Wales;
3.2Her superannuation with the Public Sector Superannuation Scheme;
3.3Jewellery in her possession;
3.4Furniture and household effects in her possession;
3.5Any motor vehicle in her possession;
3.6All other personal property, monies, bank accounts and superannuation entitlement in her possession and/or under her control;
4.That other than as ordered herein, the Husband be declared the sole owner of the following property to the exclusion of the Wife:
4.1Any real property registered in his name;
4.2Jewellery in his possession;
4.3Furniture and household effects in his possession;
4.4Any motor vehicle in his possession;
4.5All other personal property, monies, bank accounts and superannuation entitlement in his possession and/or under his control;
5.That the Wife be responsible for as against the Husband and indemnify and keep indemnified the Husband in relation to all debts and liabilities in her name (or jointly with any other person or entity);
6.That the Husband be responsible for as against the Wife and indemnify and keep indemnified the Wife in relation to all debts and liabilities in his name (or jointly with any other person or entity);
7.That the Husband pay the Wife's costs of and incidental to these Property proceedings on an indemnity basis."

Background

The wife was born in 1968 in the Country DE and is currently 49 years of age. She came to Australia in September 1991 and commenced work as a public servant in January 1992. The husband was born in 1978 and is presently aged 39 years.
The parties married and commenced cohabitation in 2005 and separated in February 2011. They were divorced by an order made in January 2014.
In May 1998 the wife purchased a townhouse at BC Street, Suburb E for $249,950, using borrowed funds of $200,000 (“the BC Street property”). In 2003 the wife and her brother purchased jointly a property at FG Street, Suburb GH for $305,000. The wife made no contribution to the purchase price and paid no mortgage instalments. She transferred this property to her brother when he married in 2011.
In June 2004 the husband purchased a property at HI Street, Suburb IJ for $175,000. He borrowed $140,000 from the ANZ Bank. In December 2006, and unbeknown to the wife, the husband increased the mortgage debt on this property to $192,000.
Shortly after the marriage on 8 October 2005, the parties purchased jointly the former matrimonial home at JK Street, Suburb E for $620,000. The husband contributed $21,000 and the wife $144,000 to the purchase price of this property. The wife obtained this sum of $144,000 from a redraw on the mortgage on her Suburb E property. The balance of the purchase money came from loans in a total sum of $496,000 from Westpac Bank. This loan amount was divided between the husband and the wife in sums of $299,000 and $197,000 respectively.
In 2008 the husband requested that the wife refinance the BC Street property in a sum of $344,000. The wife deposed that the husband changed jobs during the marriage and worked at various times in finance and insurance. In 2009/2010 the husband purchased a business.
Exhibited to the wife's affidavit were the parties' tax returns for the 2009 financial year. The taxable incomes of the husband and the wife respectively were $5,545 and $47,178. The wife deposed that, otherwise, she was unaware of the level of the husband's income during the marriage.
On 24 November 2009 the wife was admitted to hospital for four days. On 25 November 2009 an application for a top up loan of $100,000 was submitted to the Westpac Bank. This document bore a signature which purported to be that of the wife but she has steadfastly maintained at all times that she did not sign this application form.
The wife made a complaint to the Financial Ombudsman in relation to this loan application. On 5 June 2015 the complaint was determined in her favour, by a finding that she did not sign the letter of variation of loan dated 25 November 2009. This finding rested in part on an expert report from a handwriting examiner, who concluded "it is my opinion that the questioned Ms Gallego signature appearing on the letter of variation is not genuine and is the result of fabricated signing behaviour." The wife deposed that the bank officer who authorised this loan, Ms FF, was in a de facto relationship with the husband at this time.
The wife deposed that inspection of documents produced on subpoena by the Westpac Bank showed that the husband received $100,000 from this top up loan. These documents demonstrated that the husband drew cheques for $34,245 to one Ms LM, $11,000 to Ms MN and $40,000 to his brother Ms BB Mackweth.
In July 2010 the husband requested that the wife agree to an additional top up loan of $150,000. The wife deposed that he pushed her head into a wall and kicked and punched her, in the presence of the children, when she questioned his reasons. Exhibited to the wife's affidavit was a copy of a bank statement which showed that the husband received a sum of $150,000 on about 27 October 2010. The wife gave uncontradicted evidence that she received no benefit from any of this money.
When the parties separated in February 2011, the wife was left with a credit card debt of $4,414. The wife deposed that she was the account holder and the husband held a supplementary card. The husband continued to use this credit card after the separation and, ultimately, the wife paid a total sum of $4,292 to discharge this debt.
A copy of a document dated November 2011, which was exhibited to the wife's affidavit, demonstrated that the husband transferred a one-third interest in the Suburb IJ property to his brother Ms BB Mackweth for a stated consideration of $354,000. A copy of a bank statement indicated that a sum of $279,489 was deposited into the husband's account on 18 November 2011.
A copy of a Transfer by Mortgagee under Power of Sale document exhibited to the wife's affidavit indicated that the National Australia Bank sold a further parcel of the Suburb IJ property for $170,000 in 2014. Similar documents demonstrated that the remainder of the Suburb IJ property was sold by ST Bank as mortgagee, which held a judgment against the husband in an amount of $255,399.
A copy of a transfer document and bank statement exhibited to the wife's affidavit demonstrated that the husband acquired the property OP Street, Suburb H for a consideration of $1,075,000 in November 2011. A sum of $107,500 was withdrawn from the husband's Westpac account on 22 November 2011. This sum of $107,500 would appear to be a deposit of 10 per cent of the purchase price.
On 16 November 2012 the parties consented to orders for the sale of the former matrimonial home for a sum of $894,500. The net proceeds of this sale are held in a controlled monies account by the husband's former solicitors. The current balance of this account is approximately $318,000.
The wife deposed that documents produced on subpoena established that the Suburb H property was sold for $1,675,000 in August 2015 and that the National Australia Bank had commenced proceedings pursuant to its mortgage. The wife deposed further that these documents contained a direction from the husband's solicitor to pay the following cheques upon settlement of this sale:
1.        Suburb YY Shire Council - $1,620.32
2.        Sydney Water - $363.91
3.        QR Legal Pty Ltd - $40
4.        Supreme Court of New South Wales - $1,158,913.92
5.        Mr Mackweth - $308,091.21.
Exhibited to the wife's affidavit was a copy of Proposed Short Minutes of Order in the Supreme Court of New South Wales "which are unsigned, undated and not stamped". These proposed orders provided that the sum of $1,158,913.92 from the proceeds of sale of the Suburb H property were to be paid to the National Australia Bank in the sum of $858,000 and Ms FF (by way of QR Lawyers) $273,913.92.
The wife commenced proceedings for parenting and property orders in the Federal Circuit Court on 24 May 2012. On 6 October 2012 the husband filed a Statement of Claim in the Local Court, by which he claimed a sum of $5,500 from the wife. He alleged that "Ms Gallego requested the services of Mr Mackweth from April to June 2009". No judgment was ever entered against the wife in respect of this Statement of Claim.
In October 2013 the wife refinanced the mortgage on her Suburb E property in the sum of $485,000 which, after payment of a break fee of $35,407, left her with surplus funds of $132,572. The wife deposed that she spent all of these funds on living expenses and legal fees.
In June 2015 the wife again refinanced her mortgage, this time in a sum of $580,000. She spent some of these funds on a security system at her home. The wife refinanced again in March 2018 in an amount of $679,789.
The wife deposed that she has spent a total sum of $327,844 on legal fees. She indicated that she borrowed $176,320 from an unnamed friend and $50,000 from her aunt to meet legal costs and living expenses. The Full Court ordered that the husband pay the wife's costs of $26,000 in relation to his unsuccessful appeal against the parenting orders. The husband has paid no part of this sum of $26,000.
The wife applied for a Child Support Assessment on 11 September 2013 and maintained that she was afraid to do so at any earlier time. Between the date of separation and September 2013 the husband paid a total of $1,648 for the financial support of the children. He paid a total of $6,211 by way of child support between 11 September 2013 and July 2018 and owed arrears of $9,453 when the wife swore her affidavit on 9 July 2018.
The wife deposed that the husband entered her home without her consent and assaulted her in the early hours of the night of 4 April 2014. She deposed that the children were in the home and that B was hitting the husband on the leg while he perpetrated the assault. The husband was charged and stood trial in the District Court, where his senior counsel cross-examined both of the parties' children. The husband was found not guilty of these charges but, in her Reasons for Judgment in the parenting proceedings, Rees J found on the balance of probabilities that the husband assaulted the wife on 4 April 2014.
In July 2015 the wife was contacted by a private investigator in relation to an insurance claim by the husband, arising from his alleged involvement as a victim of an armed robbery on 13 November 2012. The wife deposed that documents produced on subpoena by RS Insurance demonstrated that the husband received a total of $228,513 by way of workers compensation payments between 14 November 2012 and 14 March 2015.
The wife deposed that inspection of documents produced on subpoena by ST Bank indicated that the husband was entitled to a disablement benefit of $573,027. The file produced by ST Bank pursuant to a subpoena dated 2 November 2015 (Exhibit 6) contained a letter dated 19 May 2014 which enclosed two application forms for completion and return by the husband. There was no evidence that the husband ever returned these forms to ST Bank.
The wife deposed further that these subpoenaed documents revealed that a total sum of $74,080 of these funds was paid directly to the husband's brother Ms BB Mackweth by RS Insurance. These payments were made pursuant to an authority directed by Ms BB Mackweth to RS Insurance, which attached a garnishee order of the Local Court. Documents produced on subpoena by RS Insurance (Exhibit 5) showed that the husband received a lump sum payment of $37,125 on 30 September 2016.
In her affidavit the wife set out a history of alleged non-disclosure by the husband of relevant information and documents and difficulties in securing his compliance with orders and directions of the court. A large volume of correspondence between the parties and parties' solicitors was exhibited to the affidavit of the wife. I incorporate into these reasons paragraphs 90 to 136 inclusive of the affidavit of the wife sworn on 9 July 2018, together with the relevant documents exhibited thereto.
Senior counsel for the wife drew attention to certain observations by the Full Court in the judgment which dismissed the husband's appeal against the parenting orders. The Full Court said:
24. Her Honour found as follows:
20.There were a number of relevant matters which [the father] did not disclose to the Court.
21.He did not disclose in any affidavit, or to the single expert, that he had been convicted of assault occasioning grievous bodily harm arising out of an incident when he was 17 years old. His evidence in cross-examination, as will be discussed later in these reasons, minimised the seriousness of that incident.
22.He did not disclose in any affidavit that he had been the victim of an armed robbery on 13 November 2012. The matter was in Court for a conciliation conference on 16 November 2012. He did not disclose that he had made a workers' compensation claim arising out of that incident. He did not disclose that he had been assessed by six separate psychiatrists in the course of the workers' compensation proceedings.
23.He did not disclose that all six psychiatrists had diagnosed him as suffering from serious mental illness. (The opinions of the psychiatrists will be set out fully later in these reasons).
24.He did not remember seeing Dr Shillito in January 2013.
25.He denied having been referred by [Dr V ("Dr V")] for anger management counselling.
26.He did not disclose that he was in receipt of periodic payment of workers' compensation.
27.He did not disclose that his mother, [Ms G Mackweth], had been appointed as his case guardian in the workers' compensation proceedings on the recommendation of a psychiatrist who said he was not capable of giving instructions.
28.He did not disclose that he was being treated by a consultant psychiatrist, [Dr Y], who saw him as frequently as twice each week and, at the date of the hearing, three times each fortnight.
29.[The father's] evidence in his affidavit sworn 6 March 2013 about his ability to care for the children unsupervised was totally contrary to the statements both the husband and his brother [Ms BB] were making to various psychiatrists as to his impairment during the same period.
30.[The father] actively deceived the Court when he completed his parenting questionnaire in October 2013 and, in answer to the question "Do you suffer from any medical condition which requires supervision by a medical practitioner..." he answered "N/A". That statement was false and [the father] knew it to be false. He was regularly attending [Dr Y], at times, twice a week.
31.Also in October 2013 [the father] signed an undertaking as to disclosure stating that, to the best of his knowledge, he had complied with his obligations of disclosure. That statement was false and [the father] knew it to be false.
32.Further concerns about the reliability of [the father's] evidence arose during the hearing of the parenting proceedings. He said in cross-examination that after the robbery in November 2012, he had difficulty reading and concentrating and the medication he was taking took away his memory. However [the father] relied on five separate affidavits sworn by him in 2013 and made no mention in those documents of any impairment.
33.He could not name the firm of solicitors who currently act for him or the firm who act in his workers' compensation case.
34.He could not name the solicitors who acted for him in a nine day trial in the District Court.
35.He could not remember if he had studied or attended any college in 2014.
36.He said in cross-examination that he remembered "bits" of what happened on 4 April 2014, an event which will be referred to in detail later in these reasons, but later gave quite detailed evidence about that event.
37.He denied that he was the transferor of a property recently sold by him in [Suburb H] until he was shown the signed transfer. He could not tell the Court, or was unwilling to tell the Court, where some $700,000 being the net proceeds of sale of the property recently sold by him had gone.
38.He said, in relation to a recent Financial Statement upon which he was cross-examined, that he had never read the document and did not remember swearing an oath when it was executed.
39.It is not intended here to detail each and every unsatisfactory aspect of [the father's] evidence but to demonstrate that he was not a reliable historian.
25.As these findings demonstrate, the father's pattern of non-disclosure started years before the trial commenced and was pervasive. In this respect, at trial, the father relied on nine affidavits sworn by him, only one of which predates 13 November 2012. The significance of this date is that it is on this day that the father was the victim of an armed robbery following which he attended a number of psychiatrists in relation to his claim for workers' compensation arising therefrom. All affidavits are coherent, engage with the issues in the proceedings and answer the evidence given in the mother's affidavits. They were prepared and witnessed by solicitors retained by the father. There is nothing in them which would cause concern about the father's capacity to provide adequate instructions to his lawyers, suggest that he misunderstood the undertaking as to the disclosure he signed in October 2013 or otherwise excuse his lack of candour."
In her affidavit the wife also set out her allegations of a history of family violence perpetrated against her by the husband. She deposed that he kicked and punched a wall in her townhouse at Suburb E when she refused to sign a mobile phone contract. The wife alleged that the husband broke his hand and injured his leg during this incident and exhibited to her affidavit medical reports in relation to his attendances on a radiologist and physiotherapist. Rees J accepted that the husband "kicked a hole in the wall of the home in which the parties lived."

The wife deposed further that on 5 February 2010 the husband began shouting and swearing at her and she threw a cup in his direction to protect herself. The wife maintained that the husband then slapped her on both ears with his hands, which caused her to suffer a burst eardrum. The wife exhibited to her affidavit copies of medical reports in respect of this injury. Rees J accepted that "the assault occurred as the wife alleged."
The wife alleged further that on 2 July 2010, after she refused to agree to a top up loan of $150,000, the husband became angry and pushed her head into a wall. The wife claimed that she was holding B, who was an 18-month old baby at the time. The wife alleged that she lost consciousness during this incident and that the husband's mother and sister took her to a medical centre. The wife exhibited to her affidavit a copy of notes made by a general practitioner at this medical centre. Rees J accepted that "the incident on 2 July 2010 occurred as the wife alleged."
The wife alleged that on 22 March 2011 the husband became angry and destroyed a microwave oven with a hammer. She alleged further that in about 2011 he kicked in the security back door of the premises where she then lived with the children. Rees J noted that the husband denied these allegations and concluded that "... in the absence of independent evidence, no finding can be made."
The wife alleged also that on about 25 July 2011 she and the child B were in a car with the husband, when he became angry during an argument. She contended that he pushed her head toward his lap and hit her with one hand. She maintained that she had bruising and swelling on her face and attended upon her general practitioner. Exhibited to her affidavit was a copy of clinical notes dated 25 July 2011. Rees J accepted that "the incident occurred as [the wife] deposed."
I have referred above in these reasons to the incident on 4 April 2014. I have noted that Rees J found on the balance of probabilities that the husband perpetrated an assault against the wife on this occasion.
The wife set out in her affidavit a history of alleged verbal abuse of her by the husband. She deposed that he called her "whore", "prostitute", "you fucking whore", "bitch" and made offensive remarks to her such as "fuck off bitch. I'm sleeping now. Don't ring me again. I don't want you to disturb my sleep."
I am satisfied that the husband perpetrated family violence upon the wife both during the marriage and on 4 April 2014. The wife relied upon this evidence of violence inflicted upon her in support of a submission to the effect that her contributions were made more onerous by this conduct of the husband.

Approach to these proceedings

Senior counsel for the applicant wife set out the approach to determination of these proceedings as follows in his Outline of Case document:
6.In considering applications for alteration of property interests and transfer of property, the Court must, consistent with the High Court’s decision in Stanford v Stanford (2012) 247 CLR 108 undertake the following:
(a)identify the existing legal and equitable interests of the parties in property;
(b)whether it would be just and equitable in the particular circumstances to make an alteration;
(c)if an alteration should be made, consider the matters contained in ss.79 and 79(4) of the Act in coming to an adjustment; and
(d)analyse and consider whether the adjustment under consideration would be just and equitable.
In the past, both parties have sought orders for alteration of property interests. They have not intermingled their finances since the separation some seven

and-a-half years ago and have been divorced for approximately four years. At present, the parties have a joint entitlement to a sum of $318,000 held in a controlled monies account, which can be distributed pursuant to an order for alteration of property interests. For these reasons I am satisfied that it is just and equitable that there be orders for alteration of property interests.

The assets, superannuation, liabilities and financial resources

On behalf of the wife, a Balance Sheet was submitted in the following terms:

Owner-ship		Description	Wife / de facto partner’s value
ASSETS
1.	J	NAB Controlled Monies Account	$ 318,215
2.	W	BC Street, Suburb E	$ 820,000
3.	W	German motor vehicle	$ 35,000
4.	W	TU Bank cheque Account	$ 224
5.	W	ANZ cheque account	$ 19,000
6.	W	Household contents	$ 10,000
7.	W	Laptop, Camera	$E 5,000
8.	W	Shares	$ 9,400

Total

$ 1,216,839

$ 0

ADDBACKS
9.	H	Husband’s drawdown-November 2009	$ 100,000
10.	H	Funds received from Husband’s brother, Ms BB Mackweth not otherwise applied to acquisition of the Suburb H property	$ 106,500
11.	H	Monies received on sale of Suburb H by Bank Cheque on 6/10/15	$ 308,091
12.	H	Monies paid QR Legal on making of Consent Orders in Supreme Court $273,913.92	$ 273,914
13.	H	Deposit unaccounted for on sale of Suburb H property	$ 134,000
14.	H	Monies received from RS Insurance 11/12 to 3/15	$ 228,513
15.	H	Monies received from RS Insurance 2016	$ 37,125

Total

$ 1,188,143

$ 0

LIABILITIES
16.	W	ANZ Investment Home Loan Account	$ 679,789
17.	W	TU Bank Visa credit card	$ 12,480
18.	W	ANZ Visa credit card	$ 999
19.	W	Ms UV	$ 50,000
20.	W	Commonwealth Bank – Car lease	$ 22,000
21.	W	Personal Loan	$ 176,320
22.	W	ATO	$ 27,000
23.	W	Department of Human Services	$ 4,062

Total

$ 972,650

$ 0

SUPERANNUATION
Member		Name of Fund	Type of Interest	Wife / de facto partner’s value
24.	W	Public Sector Superannuation Scheme	$ 618,290
25.	H	ST Bank - Signature Super	$ 16,259 (as at 30/6/12)

Total

$ 634,549

$ 0

SUMMARY
Ownership		Description	Wife / de facto partner’s value
26.	Total net assets (including addbacks)	$ 2,404,982
27.	Total net assets + superannuation	$ 3,039,531
28.	Total assets less total liabilities	$ 2,066,881

Notes

In relation to any disputed items and all disputed values for items a party should state, using the item number as a heading:

Why an item should not be on the balance sheet.
Whether expert evidence is required to resolve a dispute as to value and what steps have been taken to agree upon and appoint a single expert.
Whether documents in the possession of the other party need to be provided before the value of an item can be agreed.
Any other comment a party wishes to make in relation to the disputed item.

Item No
2	Market Assessment EF Partners 10 July 2018
9	Paragraphs 10 – 12.4 of Wife’s Affidavit
10	Paragraphs 17 – 19 of Wife’s Affidavit
11	Paragraph 22 of Wife’s Affidavit
12	Paragraph 23 of Wife’s Affidavit
13	The deposit on sale of Suburb H is unaccounted for: 10 per cent = $167,500 and assume 2 per cent Agent’s commission of $33,500 = $134,000

The reality is that the wife has limited knowledge of the identity and value of the parties' total assets. The husband has elected not to make full and frank disclosure and both the wife and the court were left in ignorance as to his financial position. For example, information which the wife provided in relation to the sale of the Suburb IJ property and the acquisition and sale of the Suburb H property by the husband has been gleaned from subpoenaed documents rather than evidence which he has presented to the court.
In these circumstances, it is impossible for me to make findings as to the husband's assets, superannuation, liabilities and financial resources. Accordingly I cannot follow the ordinary course and set out a Balance Sheet to reflect my findings in these reasons.
I am reluctant to make findings in terms of "addbacks" as set out in the Balance Sheet submitted on behalf of the wife for a variety of reasons. For example, the payments made by RS Insurance appear to have been made because of the husband's injuries suffered in an armed robbery. If these payments were made as workers compensation, it seems to me that an inference must be drawn that the husband was unable partly or fully to engage in paid employment and these funds therefore constitute an income stream rather than an asset.
Further, there was no evidence that orders in fact were made in the Supreme Court which resulted in a payment of a sum of $273,914 to QR Legal. As noted above, the copy of these proposed orders which was exhibited to the wife's affidavit was "unsigned, undated and not stamped". As indicated earlier, however, it certainly appears that the husband received a sum of $308,091 from the sale proceeds of the Suburb H property on the basis of documents produced on subpoena by the solicitors for the purchasers.
Additionally, the circumstances of the husband's sale or transfer of a portion of the Suburb IJ property to his brother are far from clear on the available evidence. As noted above, the transfer recorded a consideration of $354,000 and the wife could identify a deposit of $279,489 into the husband's bank account on 18 November 2011. There was no evidence that the husband ever received the balance of approximately $74,500.
I am persuaded, however, that substantial funds have come into the husband's hands since the parties' separation and that he has elected not to make full and frank disclosure of these transactions and his financial position. That being so, I accept the submission on behalf of the wife to the effect that a robust approach to the resolution of these proceedings is warranted as described by the Full Court in Inthe marriage ofWeir and Weir (1993) FLC 92-338 at as follows:
Once it has been established that there has been a deliberate
non-disclosure ... the Court should not be unduly cautious about making findings in favour of the innocent party ... The court's jurisdiction to make an order going beyond the identified property arises once there is sufficient evidence to support a finding the party has not made a full disclosure of his or her assets.
I accept further the submission on behalf of the wife that the observations of Callinan J in Chang v Su [2002] HCATrans 446 as follows, are apposite to these proceedings:
"It does not matter what the principle might be seen to be, a court has to do the best it can. It does the best it can having regard to the evidence that is adduced and if the parties are not frank then naturally there is going to be a measure of imprecision about any findings that the court can make."

Contributions

The wife's uncontradicted evidence was that she owned the following assets at the commencement of cohabitation:
1.Townhouse BC Street, Suburb E subject to a mortgage to the ANZ Bank
2.cash savings of approximately $10,000
3.Shares
4.PSS superannuation benefit with a balance of $173,487.
The wife purchased the townhouse at Suburb E in 1998 for $249,950, using borrowed funds of $200,000. There was no expert evidence as to the value of this property at the date of the marriage. The wife gave uncontradicted evidence that she had reduced the mortgage debt to approximately $190,000 by the time of commencement of cohabitation. Accordingly, an inference can safely be drawn that the wife held equity of at least $60,000 in this property as at the date of the marriage. I have no reason to doubt the wife's evidence that she had savings of about $10,000, together with shares at that time.
I thus find that the wife had net assets with a minimum value of approximately $70,000 and superannuation with a value of $173,487 at the date of marriage. I accept the uncontradicted evidence of the wife that the husband brought into the marriage the property at Suburb IJ, which he had purchased in June 2004 for $175,000 using borrowed funds of $140,000. I accept the wife's evidence that the husband owned a motor vehicle which was subject to finance at the commencement of cohabitation.
Accordingly I find that the husband owned assets to a minimum net value of approximately $35,000 at the date of marriage. I accept, on the basis of the available evidence, that the wife's initial direct financial contributions exceeded those of the husband.
During the marriage the wife held paid employment, apart from two periods of maternity leave in 2006 and 2009. I accept the uncontradicted evidence of the wife that she received full pay during the ten-month period following the birth of D. I accept also that the wife received half pay for approximately twelve months after the birth of B. The wife's evidence was that the parents of each of the parties assisted with the care of the children after she returned to the paid workforce following their births.
It is impossible for me to make any findings as to the level of the husband's income during the parties' cohabitation, other than the fact that the wife earned a much greater salary in the 2009 tax year. Otherwise, I accept that the husband's income was largely unknown to the wife.
After the separation the wife has been substantially responsible for the financial support of the children. As noted, the husband owed arrears of child support of $9,453 in July 2018.
Since April 2014 the children have spent no time with the husband and, previously, they were never in his overnight care after the separation. Accordingly, the wife has been their primary carer with little or no assistance from the husband for the past seven years.
I accept the submission on behalf of the wife to the effect that her contributions were made more onerous by the violence which the husband perpetrated against her both during cohabitation and after the separation. I have regard to the remarks of the Full Court in Britt & Britt (2017) FLC 93-764 at 77,111 as follows:
The respondent submitted that the appellant's evidence was not relevant to an issue because even if it was evidence of family violence, the appellant had called no evidence to suggest that the violence had made her contributions more onerous. This submission overlooks the obvious point that the court can infer from appropriate evidence that there was an nexus between the conduct and the relevant contributions.
In the absence of evidence from the husband, it is impossible to undertake the exercise of weighing the various contributions made by the parties against each other. I find, however, that the wife made substantial contributions to the known pool of property by way of initial assets introduced to the marriage and her earnings during the parties' cohabitation. I find also that the wife made a substantial contribution as homemaker and parent, both before and since the parties' separation.

Section 75(2) factors

The wife is aged 49 and in good health. The husband is 39 years old and suffers from psychiatric disabilities. The wife is employed as a public servant and earns a net weekly salary of $1,448. The husband's current employment and income situation is unknown, as is his capacity to participate in the paid workforce. I note that in his affidavit sworn on 14 August 2018 he deposes to being on Centrelink benefits.
The parties' children are presently aged 12 and nine and the wife will be responsible for their care, without any assistance from the husband, for several years into the future. History demonstrates that it is highly unlikely the wife will receive meaningful assistance from the husband with their financial support in the future.
The wife has a superannuation benefit with a balance of $618,290 and this fund might reasonably be expected to increase by the time of her retirement. Accordingly, the wife will have a measure of financial security at that time. The husband's position in relation to superannuation is unknown due to his failure to make full and frank disclosure.
The wife has liabilities totalling $972,650, as set out in the Balance Sheet submitted on her behalf. Payment of a lump sum to the wife from the controlled monies account obviously would have the potential to alleviate her debt position.
I have referred above to the husband's receipt of substantial funds since the separation. For reasons indicated already, I am unable to quantify these funds with any degree of precision. The fact remains, however, that the husband has received money from his dealings with the Suburb IJ and Suburb H properties and chosen not to inform the court or the wife of these relevant matters. The husband has also received $228,513 by way of periodic payments and a lump sum of $37,125 from RS Insurance since the separation. It may be that the husband has an entitlement to a payment of approximately $573,000 from ST Bank.
I am satisfied that the wife's ongoing sole responsibility for the care of the parties' children constitutes a significant factor in her favour pursuant to section 75(2) of the Family Law Act 1975 (Cth). Similarly, I am satisfied that a significant factor in her favour is the improbability that the husband will make any meaningful contribution to the financial support of the children in the future.

Conclusion

In the particular and unusual circumstances of these proceedings I conclude that it is just and equitable that there be orders in accordance with the Minute submitted on behalf of the applicant wife, with the exception of costs in her favour. In reaching this conclusion I have regard inter alia to the wife's evidence as to the nature and value of the pool of matrimonial property, her contributions (made in circumstances of family violence), the relevant s 75(2) factors which weigh in her favour; her evidence as to the financial dealings of the husband since the separation, the non-disclosure of the husband and the effort and expense to which the wife has been put in her attempts to bring finality to these proceedings.
No submission was put on behalf of the wife in support of her application that the husband pay her costs of the proceedings for settlement of property. There was no evidence as to the suggested quantum of such costs. In these circumstances, I am not prepared to make the proposed order as to the costs of the wife.

I certify that the preceding eighty-nine (89) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Stevenson delivered on 27 September 2018.

Associate:

Date: 27 September 2018

[2018] FamCA 787

27 September 2018

Key Legal Topics

Areas of Law

Family Law

Equity & Trusts

Legal Concepts

Remedies

Injunction

Costs