Gare & Farlow - [2023] FedCFamC2F 109

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Gare & Farlow [2023] FedCFamC2F 109

File number: MLC 10265 of 2019

Judgment of: JUDGE FORBES

Date of judgment: 17 February 2023

Catchwords:
FAMILY LAW –PROPERTY – application for adjustment of property interests – establishing the asset pool – valuation of wife’s business – whether business to be valued according to net asset backing, capitalised earnings or “value to owner” – evaluation of competing expert evidence – whether loan repayment to wife’s father to be added back – whether parties have made proper financial disclosure – initial contributions of one party greater than the other – consideration of future needs including income earning potential of each party – whether superannuation disparity taken into account – where property adjustment just and equitable

FAMILY LAW – PARENTING – application for increased time with father – consideration of children’s wishes where loyalty conflict exists – whether increased time for siblings should be aligned or staggered – consideration of conditions for increased time and best interests of the children

Legislation:
Evidence Act 1995 (Cth), s 79

Family Law Act 1975 (Cth), s 60CC, 75, 79

Federal Circuit and Family Court of Australia Rules 2021, r 6.06

Federal Circuit Court Rules 2001, r 24.03

Cases cited:
Aitken and Murphy [2013] FamCA 3

Bevan v Bevan [2013] FamCAFC 116; (2013) FLC 93-545

Black & Kellner (1992) 15 Fam LR 343

Calverley v Green (1984) 155 CLR 242

C & C [1998] FamCA 143

Chapman & Chapman [2014] FamCAFC 91

Chick & Chick [1987] FamCA 69

Dasreef Pty Ltd v Hawchar [2011] HCA 21

Dickons & Dickons [2012] FamCAFC 154

Fields & Smith [2015] FamCAFC 57

G & G (1984) FLC 91-582

Guinti and Giunti (1986) 11 Fam LR 160 at 165; [1986] FLC 91-759

Harrison & Harrison (1996) FLC 92-682

Hickey v Hickey & Attorney-General of the Commonwealth (Intervener) (2003) FLC 93-143

In the Marriage of Briese (1985) 10 Fam LR 642; (1986) FLC 91-713

Lee Steere & Lee Steere [1985] FamCA 57

AJO & GRO (2005) 33 Fam LR 134

Reynolds & Reynolds (1985) FLC 91-632

Scott & Scott (2006) FamCA 1379

Spencer v The Commonwealth of Australia (1907) HCA 82; 5 CLR 418

Stanford & Stanford (2012) 247 CLR 108

Taylor & Taylor & Taylor [2000] FamCA 308

Turnbull & Turnbull (1991) FLC 92-258

Vass & Vass [2015] FamCAFC 51

Warne & Warne (1982) 8 Fam LR 388

Wallis & Manning [2017] FamCAFC 14

Weir & Weir (1993) FLC 92-338; (1992) 16 Fam LR 154

Wilde & Wilde [2007] FamCA 1044

Wender & Wender [2017] FamCAFC 48

Division: Division 2 Family Law

Number of paragraphs: 481

Date of last submissions: 9 August 2022

Date of hearing: 14 – 17 February 2022

Place: Melbourne

Counsel for the Applicant: Mr Hutchings

Solicitor for the Applicant: Garland Hawthorn Brahe

Counsel for the Respondent: Mr Williams

Solicitor for the Respondent: Cohrssen Partners Pty Ltd
ORDERS

MLC 10265 of 2019

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:
MS GARE

Applicant

AND:
MR FARLOW

Respondent

order made by:

JUDGE FORBES

DATE OF ORDER:

17 FEBRUARY 2023

THE COURT ORDERS THAT:
PROPERTY
Real Property
1.Within 90 days of the date of the making of these Orders, the Husband transfer to the Wife all of his right, title and interest in the former matrimonial home known as and situated at B Street, Suburb C, in the State of Victoria and more particularly described as Volume … Folio … on plain of subdivision … (B Street, Suburb C Property).
2.Contemporaneously with the transfer of the Husband's interest in the B Street, Suburb C Property to the Wife, the Wife:
(a)Either refinance the mortgage over the B Street, Suburb C Property into her own name, or otherwise arrange a discharge of the mortgage;
(b)make payment to the Husband of $410,542; and
(c)do all things and acts necessary to arrange a withdrawal of Caveat … lodged by her over the D Street, Town E Property.

3.Pending the transfer of the B Street, Suburb C Property to the Wife, the Husband be restrained from drawing down on the mortgage.
4.The Husband retain all his right, title and interest in the land known as and situated at D Street, Town E, in the State of Victoria and more particularly described as Volume … Folio … on Crown Allotment … (D Street, Town E Property) to the exclusion of the Wife.

Personal Property
5.The Husband retain, to the exclusion of the Wife, all his right, title and interest in the property and items taken by him from the B Street, Suburb C Property at the time of his departure from the B Street, Suburb C Property in December 2019 and January 2020.
6.Each of the Husband and Wife retain their right, title and interest in their respective motor vehicles.
7.Save for the purposes of enforcing any monies due under these orders, the Husband and the Wife are solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of them.
8.Any insurance policies in the name of the Husband and Wife remain the sole property of the beneficiary named therein.

F Pty Ltd
9.The Wife retain all of her right, title and interest in the business, F Pty Ltd, to the exclusion of the Husband.

Liabilities
10.The Husband and Wife be solely liable for, and shall forever indemnify the other in relation to, any liability currently owed by them and not otherwise dealt with in these Orders.

Miscellaneous
11.Unless otherwise specified in these Orders and save for the purposes of enforcing any monies due under these or any subsequent Orders:
(a)monies standing to the credit of either party in any bank account are to become the property of the owner named thereon;
(b)the parties shall each retain their own Superannuation interests;
(c)insurance policies remain the sole property of the beneficiary named therein; and
(d)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.

12.Pursuant to section 81 of the Family Law Act 1975, these Orders finally determine the financial relationships between the parties to the marriage and avoid further proceedings between them.

PARENTING
13.All previous parenting orders be discharged.
The parties have equal shared parental responsibility for the children of the marriage, X born in 2010 (“X”) and Y born in 2012 (“Y”) and collectively known as the (“children”).
14.The children live with the Wife.
15.Until such time as the Husband obtains his own residence (whether rental or otherwise) with separate bedrooms for each child, the children spend time and communicate with the Husband as follows:
(a)During school terms:
(i)Each Wednesday evening from the conclusion of school (or 3.30pm on a non-school day) until 8pm; and
(ii)Each alternate weekend, from the conclusion of school Friday (or 3.30pm if a non-school day) until 7pm Sunday.

(b)During the school term holidays, for one week as agreed, or failing agreement commencing on the Friday the children would ordinarily be spending with the Husband pursuant to paragraph 16(a)(ii) until 5pm on the following Saturday.
(c)During the long summer holiday period, for one half as agreed and failing agreement:
(i)In 2023 and each odd numbered year thereafter, with the Husband for the second half of the period between the end of the Government Gazetted school year and 2 January the following calendar year, and week about from 2 January until the conclusion of the school holidays; and
(ii)In 2024 and each even numbered year thereafter, with the Husband for the first half of the period between the end of the Government Gazetted school year and 2 January the following calendar year, and week about from 2 January until the conclusion of the school holidays.

(d)At other times by agreement between the parties.

16.Subject to paragraph 16 hereof, once the Husband obtains his own residence (whether rental or otherwise) with separate bedrooms for each child, the children spend time and communicate with the Husband as follows:
(a)During school terms:
(i)In week 1, from the conclusion of school (or 3.30pm if a non-school day) Thursday until the commencement of school Friday (or 9am if a non-school day); and
(ii)In week 2, from the conclusion of school Thursday (or 3.30pm on a non-school day) until the commencement of school Monday.

(b)During the school term holidays, in accordance with paragraph 16(b) hereof.
(c)During the long summer holiday period, in accordance with paragraph 16(c) hereof.
(d)At other times by agreement between the parties.

17.For the first 6 months after the Husband obtains his own residence (whether rental or otherwise) with separate bedrooms for each child, Y’s time with the Husband pursuant to paragraph 17(a) hereof be suspended and Y spend time and communicate with the Husband during school terms as follows:
(a)For the first, second and third months after the Husband obtains his own residence (whether rental or otherwise):
(i)In week 1, from the conclusion of school (or 3.30pm if a non-school day) Thursday until 8pm; and
(ii)In week 2:
A.From the conclusion of school Thursday (or 3.30pm on a non-school day) until 8pm; and
B.From the conclusion of school Friday until the commencement of school Monday.

(b)For the fourth, fifth and sixth months after the Husband obtains his own residence (whether rental or otherwise):
(i)In week 1, from the conclusion of school (or 3.30pm if a non-school day) Thursday until the commencement of school Friday; and
(ii)In week 2:
A.From the conclusion of school Thursday (or 3.30pm on a non- school day) until 8pm; and
B.From the conclusion of school Friday until the commencement of school Monday.

(c)At other times by agreement between the parties.

18.Following the expiration of 6 months after the Husband obtains his own residence (whether rental or otherwise), Y shall spend time and communicate with the Husband at the times set out in paragraph 17(a) to 17(d).
19.In the event the Husband or another adult member of his household is unable to personally deliver the children to school not more than 30 minutes before the start of the school day, his time concludes at 8pm on the day preceding and he return the children to the Wife unless otherwise agreed in writing and he notify the Wife in writing as soon as it is apparent that this will need to occur.
20.On special occasions the arrangements in paragraphs 16, 17 and 18 be suspended (and recommence after the special occasion as if the time had taken place during the special occasion) and the children spend time with each of the Husband and the Wife as follows:
(a)On Father’s Day weekend, with the Husband from 5pm on the Saturday until the commencement of school Monday;
(b)on Mother’s Day weekend, with the Wife from 5pm on the Saturday until the commencement of school Monday;
(c)On the children’s birthdays:
(i)if a school day, with the parent they would not otherwise be spending the night with from the conclusion of school until 8pm;
(ii)if a non-school day, with the parent they would not otherwise be spending the night with as agreed and failing agreement from 10am until 4pm;

(d)On the Wife’s birthday, with the Wife:
(i)if a school day, from the conclusion of school until from 8pm; and
(ii)if a non-school day, as agreed and failing agreement from 10am until 4pm;

(e)On the Husband’s birthday, with the Husband:
(i)if a school day, from the conclusion of school until from 8pm; and
(ii)if a non-school day, as agreed and failing agreement from 10am until 4pm;

(f)On Easter Long weekend:
(i)In 2023 and each odd numbered year thereafter, with the Husband from 3.30pm on the Thursday prior to Easter (or the conclusion of school if a school day) until 11am on Easter Sunday and with the Wife from 11am Easter Sunday until 7pm on Easter Monday; and
(ii)In 2024 and each even numbered year thereafter, with the Wife from 3.30pm on the Thursday prior to Easter (or the conclusion of school if a school day) until 11am on Easter Sunday and with the Husband from 11am Easter Sunday until 7pm on Easter Monday.

(g)For Christmas:
(i)in 2023 and each odd numbered year thereafter, with the Wife from 3pm Christmas Eve until 3pm Christmas Day and with the Husband from 3pm Christmas Day until 3pm Boxing Day; and
(ii)in 2024 and each even numbered year thereafter, with the Husband from 3pm Christmas Eve until 3pm Christmas Day and with the Wife from 3pm Christmas Day until 3pm Boxing Day.
(iii)Otherwise, by agreement between the parties in writing.

21.For the purposes of changeover, unless otherwise stipulated herein, where it does not occur at the children’s school, the Husband collect the children from the Wife’s residence at the commencement of the children’s time with him, and the Wife collect the children from the Husband’s residence at the conclusion of the children’s time with him.
22.Each parent facilitate the children communicating with the other parent via telephone or video chat at reasonable times upon their request to do so.
23.Unless otherwise agreed between the parties in writing, each of the Husband and the Wife are to ensure the children attend all of their extra-curricular activities during the times that the children are in their care, and the other parent is permitted to attend such extra-curricular activities to observe and encourage the child.
24.Each party keep the other informed of any emergency or any significant health issues concerning the children whilst in his or her respective care forthwith.
25.Each party be permitted to take the children for holidays intrastate or interstate during the periods they are in their care pursuant to these orders and such holidays not to exceed their ordinary time with the children unless otherwise agreed in writing, and:
(a)The travelling parent must provide to the other with not less than 14 days’ notice in writing of their intention to travel interstate; and
(b)The travelling party must provide the other with a written itinerary for interstate travel including flight plans, accommodation arrangements and emergency contact details not less than 7 days in advance of their departure; and
(c)Any international travel with the children must be agreed upon in writing and that without such consent, the travel will not occur. Neither party shall unreasonably withhold consent.

26.The parties communicate by text message, email or otherwise in writing or telephone in the event of an emergency, and that all such communications be child focussed only.
27.Each party be hereby restrained by injunction from denigrating the other in the presence or hearing of the children or permitting any other person to do so.

Costs
28.Any application by either party for costs shall be filed and served within 28 days of these orders.

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 Gare & Farlow has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA AT MELBOURNE
MLG 10265 of 2019
MS GARE
Applicant
And
MR FARLOW
Respondent
REASONS FOR JUDGMENT
TABLE OF CONTENTS
Orders
Introduction
Material relied upon
Background and procedural history
Family Law Proceedings
Final Hearing - Property
Relevant principles
Identifying the parties’ legal and equitable interests
Issues in dispute
Issues relating to disclosure
Valuation of the wife’s business
The wife’s expert Mr G
The husband’s expert Mr H
Add back of the “Loan Repayment”
Chattels retained by the husband
Husband’s application for leave to rely upon earlier affidavit
Chattels retained by the wife
Loans from family members post-separation
Expenditure on improvements to the business
Conclusions as to the property pool
Contributions
Future needs
Justice and equity
Parenting
Introduction
Relevant principles
Relevant evidence
Dr J
Consideration of the statutory requirements
Resolution of the outstanding issues
Costs
REASONS FOR JUDGMENT
JUDGE FORBES
INTRODUCTION

By an originating application filed on 10 September 2019 the applicant wife (Ms Gare) seeks an adjustment of property interests pursuant to section 79 of the Family Law Act 1975 (Cth) (“the Act”) and parenting orders under Part VII of the Act.
Ms Gare was married to the respondent husband (Mr Farlow) for almost ten years and the parties have two children who are both under the age of 13.
According to the wife, the total net asset pool is $3,115,465 including the parties’ superannuation. The husband, on the other hand, contends that the total net asset pool, including superannuation, is either $3,605,166 or $3,400,486 depending on the resolution of contested valuation and add back issues.
The principal assets of the marriage include the former matrimonial home located at B Street, Suburb C, Victoria (“the B Street, Suburb C property”) and a property situated at D Street, Town E, Victoria (“the D Street, Town E property”). The valuation of these properties is agreed at $2,175,000 and $550,000 respectively.
By reason of the parties’ separation, the nature and quantum of their respective contributions to the asset pool and family life and the fact that they will no longer enjoy common use of joint property, there is no dispute that it is just and equitable that there be orders for a property adjustment[1].
[1] Stanford & Stanford (2012) 247 CLR 108
In relation to the application for property orders, the main issues in dispute include the valuation of the business owned and operated by the wife, the value to be attributed to chattels removed by the husband from the former matrimonial home and to chattels retained by the wife, and whether the sum of $106,681.87 paid by the wife to her father, characterised as a ‘loan repayment’ and paid just prior to separation, should be notionally added back into the asset pool. There is also some contention between the parties surrounding a sum of $105,000 spent by the wife on renovations for the business in the period after separation. There are numerous other ancillary issues dealt with in these reasons.
There are also disagreements about the value and weight to be given to the parties’ contributions, in particular initial contributions. In terms of future needs and other s 75(2) considerations, the wife’s income and future earning capacity are among the issues in dispute.
The parties have similar superannuation balances and although no splitting order is sought the husband contends that the wife’s larger balance (+$60,000) should weigh in his favour in the exercise of the Court’s discretion.
The Court must also decide on the parenting arrangements for the two children of the marriage, X born in 2010 and Y born in 2012 (“the children”) who currently reside with the mother and spend time with the father pursuant to interim arrangements. The parenting dispute is largely centred on the husband seeking more time with the children and the process by which any additional time should be facilitated, including whether increased time should be graduated for Y.

The matter was heard over 4 days of extended hours commencing on 14 February 2022. The wife was represented by Mr Hutchings of counsel and the husband by Mr Williams of counsel.
Further written submissions on parenting issues were filed by each of the parties in late July and early August 2022.
The reasons which follow explain the basis for the property and parenting orders I have decided to make to finalise this proceeding.
Material relied upon
Prior to the hearing the parties filed a joint chronology and other materials, including competing outlines of case.
In her outline of case filed on 10 February 2022, the wife said that she relied upon the following documents for the final hearing:
(a)amended initiating application filed on 13 September 2021;
(b)trial affidavit of Ms Gare filed on 24 January 2022;
(c)financial statement filed on 10 February 2022;
(d)affidavit of forensic accountant, Mr G filed on 17 January 2022;
(e)affidavit of the wife’s father, Mr K filed on 28 September 2022;
(f)affidavit of property valuer, Mr L filed on 4 February 2022; and
(g)affidavit of psychologist, Dr J filed on 31 January 2022.
In his outline of case filed on 14 February 2022, the husband said that he relied upon the following documents:
(a)third amended response to initiating application filed on 4 February 2022;
(b)trial affidavit of Mr Farlow filed on 4 February 2022;
(c)financial statement filed on 4 February 2022;
(d)affidavit of Dr J filed on 31 January 2022;
(e)affidavit of Mr L filed on 4 February 2022; and
(f)two affidavits of business valuer, Mr H filed on 1 February 2022 and 11 February 2022.
On the fourth day of the Final Hearing, the husband also sought leave to rely upon paragraph 81 of his affidavit sealed on 1 October 2021. After an objection from counsel for the wife, I granted leave for this paragraph to be relied upon for the confined purpose of corroborating an answer given by the husband during his cross-examination. My reasons for granting leave on this limited basis and for not permitting further re-examination of the husband are dealt with later in this judgment.
The evidence in this case was extensive, particularly in relation to the property dispute. All witnesses, save for Mr L, were called to give evidence and were cross-examined at length. The expert evidence regarding the valuation of the wife’s business was contested, complex and detailed. In addition to the material filed prior to the hearing, various documents were tendered into evidence during the trial, amended balance sheets were produced and the parties, at my request, prepared short aide mémoir to guide their final addresses.
I have read all of the documents relied upon by the parties and taken all of the evidence and submissions into account. I have also reviewed the transcript where necessary. Where relevant matters of substance are in contest, I have discussed the evidence and my findings are in the body of these reasons. However, the Court is not required to refer to every piece of evidence relied upon by the parties, traverse every argument that is advanced or make findings in relation to all of the facts that are put in issue by them.
Background and procedural history
Unless otherwise stated, the following matters were uncontroversial or established on the documentary evidence and reflect my findings.
The wife is 45 years old and in good health. The husband is 44 and in reasonable health. He asserts a hip injury which may compromise his income earning potential.
The wife owns and operates F Pty Ltd (‘the Business’). She is employed in the Business as a worker and manager. She asserts that she currently earns approximately $62,000 per annum although her earnings have varied over time and her potential income potential remains an issue in dispute.
The husband is employed as a tradesman and earns about $107,711 per annum.
In 2006, the parties met through mutual friends at the Event M and commenced a relationship. They commenced cohabitation in 2009 and were married in 2009.
There are two children of the marriage, X who is aged 12 and Y who is aged 11.
The parties separated on 14 February 2019 and lived separately and apart under one roof until January 2020.
Since separation, the wife has re-partnered and continues to live in the former matrimonial home at B Street, Suburb C. At the time of the final hearing the husband was living with his mother in her home at Suburb N, approximately 10 minutes drive from B Street, Suburb C.
In 1998, some ten years before cohabitation, the wife purchased the Business with a friend and business partner, Ms O, in equal shares. Each of them contributed $25,000 towards the $50,000 purchase. The pair incorporated F Pty Ltd to run the Business. At the time of purchase, the business premises was subject to a third party lease for which the rental was $3,330 per month.
In 1999, the freehold for the business premises came up for sale and the wife’s father, Mr K, and Ms O’s father-in-law, Mr P, purchased premises.
No written lease was entered into between the business and the landlords and the wife and Ms O were permitted to carry on the business in the absence of a written lease. Notwithstanding, the wife and Ms O continued to pay commercial rent to Mr K and Mr P at the rate that was being paid to the previous landlord, namely $3,330 per month. The wife and Ms O were also required to maintain the property and pay all outgoings.
In 2002, the wife purchased Ms O’s interest in the Business for $75,000 and thereafter became the sole director and shareholder of F Pty Ltd. It is not disputed that between 1998 and 2002, the wife paid a total of $100,000 for the Business. Following the wife’s purchase of the business it continued to operate out of premises owned by her father, as it does to this day.
The wife contends that during her adult life, commencing in her late teens or early twenties, she has been the recipient of various loans from her father. These “loans”, ranging in amounts from a about $400 to $25,000 and totalling $114,885, were purportedly advanced by the father over a 20 year period for a multitude of reasons, including to assist with the purchase of assets, including a car and the wife’s first home, and to pay off tax debts, cover personal expenses and to purchase a car for the husband. According to the wife, each of these sums received from Mr K was advanced on the basis that it would be repaid. A repayment of the “loans” by the wife to her father, shortly prior to separation, is the subject of dispute in these proceedings.
Prior to the commencement of their relationship, each party owned a property. In 2003, the wife purchased a property located at Q Street, Suburb R for $350,000. The wife claims that she was loaned $29,000 by her father to assist with the purchase. In 2004, the husband purchased a property situated at S Street, Suburb R (‘the S Street, Suburb R Property’).
On 19 February 2008, the parties set up a joint ‘Maxi-I Direct Account’ with Westpac for the purposes of purchasing a property together.
In 2008, the wife sold her Q Street, Suburb R property and says that she received a sum of $465,000 upon settlement, after discharge of the mortgage. The husband contends that the net proceeds of that sale to the wife were $420,000.
The husband sold his S Street, Suburb R property for approximately $410,000 and received net proceeds of $207,000 upon settlement.
In the same year, the parties purchased a block of land at B Street, Suburb C (the B Street, Suburb C property) for $628,500. They subsequently built the matrimonial home on the land for approximately $390,000.
The wife contends that she contributed the $465,000 settlement proceeds from the sale of her Q Street, Suburb R property and personal savings of $112,296 towards the purchase of the land and construction of the former matrimonial home. The husband says he contributed the entirety of the net proceeds of the S Street, Suburb R sale (i.e. $207,000) towards the land purchase and build. The balance of the land and construction of the B Street, Suburb C property was financed through a Westpac Mortgage.
It is not disputed that the husband made non-financial contributions to the build of the former matrimonial home, using his skills as a tradesman, including by completing various works, preparing and installing the concrete slab for the outdoor shed and installing fire pumps and hose reels.
The parties married in 2009 and moved into the B Street, Suburb C property.
In 2010, the child X was born. X is currently 12 years old. After attending T School, X has been accepted into U School where he was expected to commence his secondary education this year.
In 2012, the child Y was born. Y is currently 11 years old and attends T School.
In or around 2014, the wife’s father Mr K purchased Mr P’s interest in the business premises. Mr K has never offered the wife a formal written lease and asserts that he has no intention of doing so. Nonetheless, despite there being no written lease in place, the wife continues to occupy the premises and pay rent at the rate of $3,330 per month and outgoings. She also gave evidence that she is required to keep the premises in good repair by re-doing the floors, painting and landscaping approximately every three years.
The husband contends that there is no written lease in place between the Business and the owner of the premises because of the father-daughter relationship, and argues that they have refrained from entering any formal arrangement in order to minimise the value of the business as an asset in these proceedings. This issue is relevant to the value to be attributed to the business and is explored later in these reasons.
In June 2018, the parties purchased a bush block at D Street, Town E for $370,000 (D Street, Town E property), drawing against the mortgage secured against the matrimonial home. The husband is the sole registered proprietor of the D Street, Town E property and it is common ground that he has met most of the expenses related to its upkeep. According to the husband, it was the parties’ joint decision to purchase the D Street, Town E property, however the wife asserts that it was the husband’s idea and that she acquiesced only because he agreed to cover all expenses and mortgage repayments.
Between July 2018 and January 2020, the husband was solely responsible for the mortgage repayments on the former matrimonial home, against which the D Street, Town E property is secured.
In July 2018, the husband received a redundancy payout of $56,569.45. He says that this sum was used to reduce the outstanding mortgage on the B Street, Suburb C property.
In August 2018, the wife says that her father “made a demand for repayment of a substantial portion of the loan”[2] owed to him. The wife transferred to Mr K a sum of $106,681 that she held in savings. The husband claims no knowledge of these savings or this transaction and contends that he did not become aware of it until it was unearthed during the course of these proceedings.
[2] Affidavit of Ms Gare filed 13 September 2021, para 117
In February 2019, the parties formally separated but continued to live under the one roof in the former family home at B Street, Suburb C. It is not contested that following separation, the husband spent considerable time in the shed at the property when he was not working. He says that this arrangement was in place to ensure that the living environment for the children in the home was amicable. The wife alleges however that the husband took to the shed to socialise with mates, smoke, get drunk and play loud music and contends that in the period post-separation he “exacerbated” the problems in their relationship.
The wife deposes to having unilaterally paid for the children’s school fees, uniforms, clothes and extracurricular activities since separation save for the costs of the children’s motorcycling which the husband contributes towards.[3]
[3] Affidavit of Ms Gare filed 13 September 2021, para 124
On 10 May 2019, the wife lodged a caveat on the D Street, Town E property.
Family law proceedings
On 10 September 2019 the wife commenced proceedings in this Court seeking parenting and property orders.
In her initiating application, the wife sought final orders that both parties have equal shared parental responsibility for the children, that the children live with her and spend time and communicate with the husband at such times as ordered by the Court, that all marital assets be divided as to 70% to the wife and 30% to the husband and that each party retain their current superannuation entitlements to the exclusion of the other. Interim Court orders were also sought that, inter alia, the children live with the wife and spend time with the husband each alternate weekend and on either a Tuesday or Wednesday after school, that changeover take place at the wife’s house and that the wife have sole use and occupation of the former matrimonial home with the husband to pay the mortgage repayments. The wife also sought an interim order that a forensic accountant, Mr G, be appointed to prepare a valuation of the business.
In his response filed on 9 October 2019 the husband sought the urgent preparation of a family report and that he be excused from particularising final parenting orders pending the completion of that report. The husband also sought that both parties exchange copies of all documents that reflect their financial circumstances within 14 days and that he be excused from further particularising property orders until that exchange.
On 6 November 2019, Mr G, the forensic accountant instructed by the wife, valued the business at $57,129, based on a valuation method developed by him over two decades[4]. As will be discussed in more detail later in these reasons, Mr G’s valuation was based on an assessment of the earnings before interest and taxation (i.e. EBIT) that could reasonably be expected to flow to a hypothetical purchaser as profit.
[4] Annexure “-1” of Mr G’s Affidavit filed 17 January 2022; Court Book (‘CB’), p 127
A few days later, Mr H, a property and business valuer instructed by the husband, valued the business as a going concern at $60,288 on a “fair market value” basis[5]. This valuation took into account information from Mr K that there was no lease in place, and that he would not offer a lease to any potential purchaser of the business because he wanted to convert the property into another business. Mr H otherwise opined that he would have adopted a value of $361,723 for the business if it had an industry standard lease in place.
[5] Spencer v The Commonwealth of Australia (1907) HCA 82; 5 CLR 418
On 18 November 2019 orders were made by consent for the children to live with the mother and spend time with the father on each alternate weekend from the conclusion of school on Friday until 7pm on Sunday and on each Wednesday from the conclusion of school until 7pm, until further order. The parties agreed to implement a week about arrangement for the 2019/2020 summer school holidays. As to property matters, it was agreed that the husband would vacate the former matrimonial home by 1 January 2020 and each party was ordered to pay one half of all mortgage instalments on the former matrimonial home. Orders were also made for the husband to retain, for his sole use and benefit, all items in the shed and shipping container.
Procedural orders were also made on 18 November 2019 directing the preparation of a family report and for the parties to attend a private mediation.
On 1 January 2020 the husband moved out of the former matrimonial home at B Street, Suburb C and removed all the items from the shed. The husband moved into his mother’s residence in Suburb N where he continued to reside up until the final hearing of this matter.
The items removed from the shed by the husband included tools, motorbikes, buggies and ski equipment and various toys and equipment enjoyed by the children. The wife says that the items removed were of significant value and included furniture, whitegoods, a generator and motor bikes. Although the wife did not put any expert evidence before the Court about the value of these chattels, her estimate of $80,200 is contested by the husband and is one of the issues to be determined by the Court.
On 25 May 2020 Mr H, instructed by the husband, prepared an amended valuation of the business, on this occasion assessing it to be valued as a going concern at $400,000 on a “value to owner” basis[6]. The valuation of the Business is a hotly contested issue in the proceeding. This valuation and earlier and subsequent valuations and the bases on which the valuations have been established are explored later in these reasons.
[6] Annexure “-2” of Mr H’s Affidavit sworn 25 January 2022
On 26 May 2020, the parties and the children were interviewed by Family Consultant, Dr J (“Dr J”) for the purposes of preparing a Family Report.
On 22 July 2020, Dr J’s Family Report was released to the parties. Dr J recommended that both parents should complete a ‘parenting after separation’ program, that arrangements should be made which limit face-to-face interactions between the parents, that the children spend time with the husband on a Wednesday overnight in one week and a Friday to Monday in the alternate week, and that the children spend half of their school holidays with the husband.
In August 2020 the parties attended a private mediation, which was unsuccessful.
On 28 September 2020, the wife filed a second amended initiating application in which she proposed that the husband should spend time with the children each Wednesday after school until 8pm and each alternate weekend from the conclusion of school on Friday until 5pm Sunday. In relation to property, the wife sought final orders for the husband to transfer to her all of his right, title and interest in the former matrimonial home at B Street, Suburb C, for the husband to retain the land in D Street, Town E and for the wife to pay the husband $32,238. Moreover, the wife sought to retain all her right and interest in the business to the exclusion of the husband.
Also on 28 September 2020 both parties filed and served trial documents including affidavits in anticipation of an October 2020 trial. The trial date was however vacated and relisted for final hearing on 20 May 2021.
At around the same time, October 2020, the husband inspected documents which had been subpoenaed from Westpac Bank in the previous month. The husband deposes that upon inspection of bank statements he discovered that in or about August 2018 the sum of $106,681.87 had been withdrawn by the wife from an account held by her which had not hitherto been disclosed in the proceedings.
In March 2021 the children commenced reportable counselling with a psychologist, Ms V.
On 6 May 2021, ahead of the forthcoming trial, the husband filed an amended response to the wife’s second amended initiating application together with a financial statement and updated affidavit. On this occasion the husband sought final orders broadly consistent with the recommendation of Dr J.
In relation to property matters, the husband sought various orders including that the amount of $106,681 (the amount transferred to by the wife to her father in repayment of loans) be “added back” into the asset pool. The husband otherwise proposed that he transfer his interest in the former matrimonial home to the wife, that she refinance the former matrimonial home in her name, that the wife remove the caveat on the D Street, Town E property and that she pay him $550,000. The husband also proposed that the wife retain her interest in the Business to the exclusion of the husband.
The trial did not proceed on 20 May 2021. That day orders were made by consent for the preparation of an updated family report and updated real estate valuations, with a view to the matter going to a final hearing on 18 October 2021.

On 13 September 2021 the wife filed a third amended initiating application and other trial material. By this most recent application the wife sought orders that the children live with her and spend time and communicate with the husband each Wednesday evening from the conclusion of school until 8pm and on each alternate weekend from the conclusion of school Friday until 7pm Sunday. In relation to property matters, the wife proposed that she make a payment to the husband of $39,932 and that she refinance the former matrimonial home into her sole name and remove the caveat on the D Street, Town E property.
On 27 September 2021 the matter was mentioned before Judge Howe. At the time the parties had been unable to obtain an updated family report due to COVID restrictions. The parties were ordered to attend upon a private mediation, the October hearing date was vacated and the matter was set down for Final Hearing to commence on 14 February 2022.
In late October 2021 the parties and the children interviewed with Dr J for the purposes of her preparing a supplementary Family Report.
On 25 November 2021 Dr J’s supplementary Family Report was released to the parties. That report and her evidence to the Court are discussed later in these reasons. However, in substance, Dr J supported the idea that the children should spend more time with their father and that the number and frequency of transitions between the parents should be reduced. Dr J proposed that the children should spend time with the husband on each alternate week from Thursday after school until Monday morning, and overnight on a Thursday in every other week.
On 17 January 2022, Mr G filed an affidavit in this proceeding on behalf of the wife which annexed an updated expert valuation valuing the business at $56,948.
On 1 February 2022 the husband filed a further report from Mr H in which he expresses the opinion, based on more recent financial accounts, that the wife’s business is valued at $429,500 on a “value to owner” basis.
In an affidavit filed on 4 February 2022 Mr L annexed valuation reports which assessed the former matrimonial home to be valued at $2,175,000 and the D Street, Town E property at $550,000. The parties do not contest Mr L’s valuations and he was not required for cross-examination.
On 4 February 2022 the husband filed a response to the wife’s third initiating application and other trial materials. Informed by the recommendations in Dr J’s supplementary report, the husband sought orders that the children spend time with him on each alternate Thursday from the conclusion of school until the commencement of school on Friday and each alternate weekend from the conclusion of school Thursday until the commencement of school on the following Monday. In relation to property, the husband now seeks an order that the wife pay him a sum of $630,000.
On 11 February 2022, the last business day before the trial, the husband’s solicitors filed a further affidavit of Mr H which annexed an updated business valuation and report in relation to the wife’s business, this time adopting the same “fair market” valuation methodology used in the preparation of his first report in November 2019. In this report, Mr H expresses the opinion that the realisable value of the business (absent a commercial lease) is $224,820 on a fair market value basis.
FINAL HEARING - PROPERTY
Relevant principles
The approach to the determination of an application for property orders is well-settled.
As set out in Stanford & Stanford (2012) 247 CLR 108, the starting point is a consideration of “whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property”.
Prior to the decision in Stanford, the orthodox approach taken when determining an application for adjustment of parties’ interests in property following the breakdown of a marriage was that set out in Hickey v Hickey & Attorney-General of the Commonwealth (Intervener) (2003) FLC 93-143 (at p 39). There the Full Court identified the following four inter-related steps:
(a)Identify and value, as at the date of hearing, the parties’ property, liabilities and financial resources;
(b)Identify and assess the contributions, under s 79(4)(a), (b) & (c) of the Family Law Act 1975 (“the Act”) (“the first limb – the contribution factors”), of the parties and express them as a percentage of the net value of the property (examined on either a global approach or an asset by asset approach, depending on the circumstances of the case);
(c)Identify and assess the other factors relevant under s 79(4)(d), (e), (f) & (g), (“the second limb – ongoing needs and effect of orders”) including, because of s 79(4)(e), the matters referred to in s 75(2), and determine the adjustment (if any) to be made to the contribution entitlements at step two; and
(d)Consider the effect of the above and resolve what order is just and equitable in all the circumstances of the case.
In undertaking the first step outlined above, the Court must act with reasonable precision in both identifying and valuing the property pool. However, in the subsequent steps, the Court is not required to assess contributions with mathematical precision: G & G (1984) FLC 91-582 (Nygh J).
This approach was revisited by the Full Court in Bevan v Bevan [2013] FamCAFC 116; (2013) FLC 93-545 (“Bevan”) in light of the High Court’s comments in Stanford. There, at [71], Bryant CJ and Thackray J stated:
“Stanford will also serve as a reminder that the four step process “merely illuminates the path to the ultimate result”. Any future restatement of that process should incorporate acceptance of the fact that the power to make any order adjusting property interests is conditioned upon the court finding that it is just and equitable to make an order.”
As was said in Bevan at [86], the requirement for justice and equity is “not a threshold issue, but rather one permeating the entire process”. However, as I observed in the introduction, if it be a threshold issue, there is no dispute between the parties nor any doubt in my mind that an order adjusting property interests in this case is just and equitable.
Identifying the parties’ legal and equitable interests
As a general proposition, the identification and valuation of assets and liabilities is at the date of the final hearing.[7] All property of the parties must be considered. There is no necessary distinction between ‘business’, ‘matrimonial’ or other categories of property[8].
[7] Warne & Warne (1982) 8 Fam LR 388 at 389 (per Simpson J; Strauss and Hase JJ agreeing); also see AJO & GRO (2005) 33 Fam LR 134 at 142 (per Holden, Warnick and Le Poer Trench JJ)
[8] See e.g. Lee Steere & Lee Steere [1985] FamCA 57 regarding the inclusion of a farming business and properties
The outlines of case filed by the parties each contained balance sheets which identified their respective contentions regarding the asset pool for the purposes of adjustment. During the proceedings amended and refined balance sheets were produced for the Court by the respondent which presented various alternative final positions. But in terms of the parties’ starting positions, combining their balance sheets reveals the composition of the asset pool and the points of agreement and differences between the parties is represented as follows:

ASSETS

Description Ownership Applicant’s value Respondent’s value

1. B Street, Suburb C[9] Joint $2,175,000 $2,175,000

2. D Street, Town E[10] Husband $550,000 $550,000

3. Westpac Classic Plus Account ending in #...97 Joint $4,291 $4,291

4. Motor Vehicle 1 Wife $70,000 $75,000

5. Motor Vehicle 2 Husband $50,000 $45,000

6. Applicant wife’s savings Wife Unknown Unknown

7. Westpac Choice Account ending in #...85 Husband Unknown $178

8. F Pty Ltd Wife
$56,948[11]
$429,500[12] or
$224,820[13]

9. Funds withdrawn by wife for “loan repayment” to father (to be added back) Joint Nil $106,682

10. Household chattels Wife $5,000 $80,000

11. Shed items retained by husband Husband $80,200 $28,400

Assets subtotal $2,991,439 $3,494,051[14]
$3,289,371[15]

LIABILITIES

12. Westpac Rocket Repay Home Loan (Mortgage) Joint $393,858 $393,858

13. ANZ Visa Credit Card Husband E$9 E$9

14. Westpac Bank Credit Card Husband E$9,222.23 E$9,222.23

15. Credit Cards Wife $2,434 $2,434

16. Loan from the wife’s father Wife $183,090 NIL

17. Loan from the husband’s mother Husband NIL $196,000

Liabilities subtotal $588,613 $601,523

SUPERANNUATION

18. Super Fund 1 Wife E$388,746 E$388,746

19. Super Fund 2 Husband E$323,892 E$323,892

Superannuation subtotal $712,638 $712,638

TOTAL (assets – liabilities) $2,402,626 $2,892,528
$2,687,848

TOTAL (assets – liabilities + superannuation) $3,115,264 $3,605,166
$3,400,486
[9] Per Company W valuation as at January 2022
[10] Per Company W as at January 2022
[11] Per valuation of Mr G filed 17 January 2022
[12] Per valuation of Mr H dated 6 December 2021 “value to owner”
[13] Per valuation of Mr H dated 11 February 2022 “fair market value”
[14] Accepting “value to owner’ valuation of business
[15] Accepting “fair market value” valuation
Issues in dispute

There is no dispute between the parties regarding the valuation of the principal assets of the relationship, namely the matrimonial home at B Street, Suburb C ($2,175,000) and the block at D Street, Town E ($550,000).
There is no dispute about the outstanding balance of the mortgage which is secured against the B Street, Suburb C property ($393,858) and it is accepted as common ground that a significant portion of that mortgage was used to help purchase the D Street, Town E property in 2018.
There is also no dispute about the amount held in the parties’ joint Westpac Classic Plus account ($4,292).
There is a difference in the valuations each party has attributed to their motor vehicles. The wife says her Motor Vehicle 1 is worth $70,000, whereas the husband says it is $75,000. The wife contends that the husband’s Motor Vehicle 2 is worth $50,000, husband says $45,000. Despite these small differences in valuations, the parties agree that the combined value of motor vehicles in the pool is $120,000 and counsel sensibly suggested that a median value of $72,500 for the Motor Vehicle 1 and $47,500 for the Motor Vehicle 2 would be an appropriate compromise. I agree.
In opening their respective cases, there was general consensus between counsel that the principal issues which fall to be determined in relation to the asset pool are:
(a)the proper valuation of the wife’s business and the methodology to be used for the purposes of establishing that valuation;
(b)whether the “loan repayment” of approximately $106,000 made by the wife to her father in August 2018 should be “added back” into the matrimonial asset pool;
(c)the valuation of the “shed contents” removed and retained by the husband post‑separation;
(d)the valuation of household chattels retained by the wife post-separation; and
(e)whether each party’s post-separation borrowings from family members (substantially in relation to legal fees) should properly be included as a liability on the matrimonial balance sheet.
In relation to contributions and section 75(2) factors there was also a general consensus that the principal issues to be determined include:
(a)the proper assessment of the parties’ initial contributions and the extent to which the wife’s initial contribution was greater than the husband’s;
(b)whether the wife’s greater initial contribution should be given weight as a springboard for the parties’ future accumulation of wealth;
(c)whether the husband’s financial contributions (principally to the mortgage) should be regarded as having been offset or diminished by his withdrawals for personal expenditure;
(d)the proper assessment of the parties’ non-financial contributions including the wife’s homemaker and parental responsibilities;
(e)in terms of future needs, the true future income potential for each of the husband and wife; and
(f)while no superannuation split is sought, whether the difference in superannuation balances should be taken into account as a discretionary adjustment in favour of the husband.
Each of these issues was the subject of considerable evidence and submissions and each is explored in greater detail below.
Counsel for the applicant wife contended that when all matters are taken into account justice and equity supports an adjustment of the parties’ property interests 70%/30% in her favour. Counsel for the husband on the other hand contended that justice and equity supported an adjustment of property interests 55%/45% in favour of the wife.
Issues relating to disclosure
Before embarking on an exploration of each of the contested issues it is appropriate to make some preliminary observations about the obligation that parties in family law proceedings have to make a full and frank disclosure of all relevant financial circumstances. This issue arises because each party has raised against the other allegations that the other party has failed to make ‘full and frank disclosure’ of their respective financial circumstances.
The Federal Circuit and Family Court of Australia Rules 2021 and the predecessor Federal Circuit Court Rules 2001 (“the Rules”) require parties to make full and frank disclosure of all relevant financial circumstances in financial proceedings.[16] Apart from requiring each party in financial proceedings to file a Financial Statement, the Rules also require the timely production and supply of relevant documentation. If one party fails to fulfil that obligation, it would theoretically be “open to that party to rely on the absence of satisfactory evidence to prevent the making of an order against him or her which otherwise justice and equity would require”.[17]
[16] Rule 6.06 of the Federal Circuit and Family Court of Australia Rules 2021 and Rule 24.03 of the predecessor rules
[17] Guinti and Giunti (1986) 11 Fam LR 160 at 165; [1986] FLC 91-759 at 75,555
As to the central importance of financial disclosure in proceedings of this kind, Smithers J in In the Marriage of Briese (1985) 10 Fam LR 642; (1986) FLC 91-713 stated:
“I believe that the conclusion of the House of Lords in the case of Livesey v Jenkins is apposite, namely that in financial proceedings between spouses each party must make a full and frank disclosure of all material facts. In that case it was made clear that full and frank disclosure was required as a matter of principle in the light of the fact that it was the duty of the court, taking into account a number of designated criteria, to make a decision which basically involved the exercise of discretion. This is quite different from common law litigation between strangers, in which such a general duty does not exist, and obligations would only exist in so far as statute or court rules required. In my view it is fundamental to the whole operation of the Family Law Act in financial cases that there is an obligation of the nature to which I have referred.”[18]
[18] In the Marriage of Briese (1986) FLC 91-713 at 75,181
The obligation for parties to make full and frank disclosure of financial information is fundamental to the task the Court is called upon to undertake in cases seeking an adjustment of property interests under s 79 of the Act. The task of doing justice and equity between the parties by the exercise of discretion is made all the more difficult and might even be undermined or frustrated[19] if one or other of the parties deliberately or recklessly misleads the Court or the other party about their financial interests and resources. Disclosure is a positive obligation which should weigh heavily on the conscience of parties between whom justice and equity is to be done. Disclosure must be full and it must be frank. No moral licence excuses a party from their duty to the Court.
[19] See e.g. Black & Kellner (1992) 15 Fam LR 343 at 347-348
Where it is established that there has been deliberate non-disclosure, then the Court should not be unduly cautious in making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this kind[20].
[20] Weir & Weir (1993) FLC 92-338; (1992) 16 Fam LR 154
Suffice to say I have borne these principles in mind in my consideration of the contested issues in this case and in the exercise of my discretion.
Valuation of the wife’s business
Based on the distance between the parties’ positions, the most significant issue to be determined in this case is the proper valuation of the wife’s business at Suburb N. In her outline of case the wife values her interest in the business at $56,948, a valuation based on the evidence of her expert witness Mr G. In his outline of case the husband values the wife’s interest at $429,500, although the husband has proffered an alternative valuation of $224,820 depending on the valuation method adopted. The valuations advanced by the husband are supported by the evidence of his expert Mr H.
As explained in the earlier background narrative, the wife purchased the Suburb N business with her friend Ms O in 1998 through the entity F Pty Ltd, each contributing $25,000 to the purchase price. When cross-examined the wife was unable to recall the turnover of the centre at the time of purchase. The business operates from leased premises.
Sometime after the business was purchased the wife’s father and Ms O’s father purchased the freehold of the Suburb N premises from which the business operates. No written lease was put in place or has ever existed between the business owners and their new landlords.
The wife confirmed that in 2002, 7 years before she commenced her relationship with the husband, she purchased Ms O’s share of the business for $75,000, thereafter becoming the sole shareholder and director. There was no evidence about the turnover of the business at the time of that transaction or at the time the parties commenced cohabitation.
Some years later, in 2013, the wife’s father became the sole proprietor of the freehold on the premises and the wife’s sole landlord. From 2002 the wife has continued to operate and grow the business at the premises now owned by her father. There is no written lease in place, although the business continues to pay what is asserted to be a commercial rent. The wife has had an interest in the business for nearly 25 years and her father has been the landlord for most of that time.
The wife’s case is that the business provides her with a source of income but that if she were to sell it she would not recover anything other than the cash value of the business assets. When cross-examined the wife agreed that she could realise a greater return for the business if her father entered a written commercial lease with her or a prospective purchaser, but she said that she had no intention of selling and that her father would not offer a written lease in any event.
The husband on the other hand contends that the business has a much greater intrinsic value, whether valued by its net asset backing or on a “value to owner” basis which would assume the existence of an industry standard commercial lease between the business and the landlord. The substance of the husband’s case is that the absence of a written lease between the wife and her father is a calculated and deliberate ploy to minimise the true underlying value of the business by presenting it as an unsaleable asset.
The gravamen of the husband’s case is that the Court should conclude, on the evidence, that in the event that the wife wished to sell her interest in the business, her father (as landlord) would provide a purchaser a suitable commercial lease for the continuation of the business at that site in order to maximise the financial return to his daughter by allowing her to realise the goodwill of a successful 20+ year investment.

Turning then to the evidence.
Lay evidence
The evidence of the wife and the financial records of the business confirm that it has been operating for nearly 25 years, for most of that time under her ownership and management and for most of that time on premises owned by her father. Over its many years of operation the business has proven itself to be a very good solid business with stable and steadily growing revenue. During cross-examination the wife was taken through financial records for the business which formed part of the court book. She was asked questions about and confirmed entries in those financial reports which revealed that in the last 7 years annual revenue had grown from $639,000 in 2014 to nearly $1m in 2020 and 2021. It is a profitable business and it has allowed the wife to draw a regular income of up to $130,000 per annum and some profits have been retained to fund repairs, maintenance and capital improvements to the property. The wife’s salary has been decreased substantially from about the time of the separation. There have been some recent significant expenditures on improvements to the premises (approx. $105,000), but these are matters about which I will comment later.
The wife confirmed that she had operated the business from the same premises in Suburb N for more than 20 years without a formal written lease and without ever being asked to vacate the premises. The wife gave evidence that the business is not a saleable asset and says that it effectively exists in order to provide her with a wage. She said that she has no present intention to sell the business. Although the business pays a commercial rent the wife says that she has been informed by her father and believes that he has no intention of offering the business a written lease. When it was put to the wife that her father would assist her to obtain the best possible price if she ever decided to sell, she disagreed and said “not at all”.[21]
[21] Transcript of 15 February 2022, p 95
Mr K, the applicant’s father, gave evidence about his ownership of the premises. In his affidavit filed on 10 October 2020, Mr K confirmed that he had not offered his daughter a lease when he became the sole owner of the freehold in 2013, but required her to continue paying commercial rent and to keep the premises in good repair. He deposed to owning a number of commercial properties and said that “If Ms Gare was to choose to close the Business, my intention is to convert the current business premises into a another business centre”[22] (my emphasis).
[22] Affidavit of Mr K sworn 26 September 2020, para 20
When cross-examined Mr K was asked whether he would provide a written lease to the business if his daughter approached him and said that she wanted to sell it for the best possible price. He said somewhat emphatically that he would not because he would rather repurpose the building into another business centre or something like that because it is in a prime position, it has a car park and that he could maximise his money that way. In any event, he did not think that his daughter wanted to sell the business because it provided her with a job and if she did sell it there would be significant capital gains tax consequences.[23]
[23] Transcript of 15 February 2022, p 140
When pressed on the question of whether he would provide his daughter a lease if it would help her maximise the realisable value of her business, the following exchange took place:
Counsel:Yes. Okay. So the situation is that you wouldn’t provide your daughter with a lease in the event that she said, “I want to sell”, to maximise the return for your daughter. You wouldn’t allow that lease process to move forward. Is that right?
Mr K: No. It would only be short term gain. Yes. Not worth it.
Counsel:Because the return to you is more important than the return to your daughter. Is that your position?
Mr K: End game. Yes.
Counsel:Yes. Yes. Yet you’re a generous father, you say. I suggest to you that…
Mr K: Yes. I am
Counsel: …You’re not telling the truth?
Mr K:Well, stick around and watch and it won’t be sold. I’m not selling it. Like, I’ve got other stuff. Why would I want to sell it? It’s just not…
Counsel:I’m not suggesting, sir, that you sell the property. I’m suggesting that you provide your daughter with a lease in the event that she wanted to sell the business?
Mr K: Well, if you knew the property…
Counsel:And that would be of great assistance to your daughter if she wanted to sell?
Mr K: I don’t think so long-term. No.
Mr K was at pains to impress upon the Court that he does not have leases with tenants in any of the properties in his $8-$9m portfolio. “As for leases, I’ve got other factories everywhere else and none of them have got leases…”[24]
[24] Transcript of 15 February 2022, p 140
Mr K was also asked a series of questions regarding his communications with the husband’s expert valuer Mr H. Mr K confirmed that he was present at the property when Mr H first attended to value the business and that, in response to questions from Mr H, he stated that there was no lease in place. Mr K also confirmed that he had other communications with Mr H, including informing him that he did not agree with his valuations and ensuring that he understood that if the business was not operating from the premises he was going to go and repurpose the building, just as he did with a building in Suburb R.
In giving his evidence Mr K presented as a direct, forthright and somewhat abrupt witness. I have little doubt that Mr K is a successful commercially-minded man and that in business he is unlikely to let emotion cloud his decision making. Nonetheless, on this issue and others, my overall impression of Mr K was that of a determined protective father who is aligned to his daughter’s interests in the current litigation.
In relation to the issue of whether he would offer a written lease to his daughter if she wished to sell the business, I felt that his answers in cross-examination, although confidently expressed, were tailored to a narrative that would minimise the value of the business in the asset pool. In giving his answers my impression was that Mr K was not prepared to seriously countenance the possibility that his daughter would ever contemplate selling the business as a going concern. Whilst he did give an answer to a question about a hypothetical request from his daughter for a lease, my impression was that Mr K did not really think it would ever happen and for that reason was confident to maintain the position that he would repurpose the building if his daughter did not want to continue operating the business. However, if confronted with the reality that his daughter’s business might realise well over $400,000 (on Mr H’s evidence) if sold with a lease, I have considerable doubt, given his previous acts of generosity, that Mr K would deny his daughter the opportunity to realise the fruits of her 25 year investment. His concerns about the capital gains tax consequences of a sale implicitly acknowledges inherent value in the business.
Expert valuation evidence
Both parties sought to adduce expert evidence to support their competing valuations of the business. Regrettably, there being no single expert agreed between the parties, the Court must resolve the valuation conundrum, including the methodology to be used.
Objections to expert qualifications
At the commencement of the hearing, Mr Hutchings, counsel for the applicant wife, raised an objection to the valuation evidence of the husband’s proposed expert, Mr H. The applicant’s objection was advanced on two bases. First, it was submitted that Mr H was not appropriately qualified as an expert and did not possess the requisite skill, training or experience to give opinion evidence[25]. On that basis it was submitted that the Court should reject all of Mr H’s evidence as inadmissible opinion, including each of the reports he had prepared and filed in the proceeding. Secondly, and in the alternative, the wife’s counsel objected to the receipt of Mr H’s second affidavit on the basis that it had been filed and served very late, indeed on the last business day prior to the hearing, thereby causing prejudice to the wife.
[25] Evidence Act 1995 (Cth), s 79
Counsel for the respondent husband argued that the objections had no proper basis. The Court was informed that notwithstanding the long history of these proceedings there had not been any earlier application to disqualify Mr H from giving evidence. Mr Williams said that it was an astounding proposition to suggest that Mr H lacked the requisite competence or qualifications to prepare a financial valuation.
Counsel for the respondent returned fire and raised issues about the wife’s expert Mr G, submitting that his valuation was based on outdated financial reports and for that reason should be regarded as hopelessly out of date, unreliable and lacking any probative value. Indeed, the husband’s counsel contended that the Court would be in serious error if it relied upon Mr G’s expert opinion because doing so would contradict the legal principle that the Court must establish the value of the assets at the time or as close as is practical to the time of the proceeding.
Furthermore, counsel for the husband submitted that, having regard to the lack of currency of Mr G’s evidence, if the Court did not allow the husband to rely upon Mr H’s evidence, the Court would in effect be left in a situation where it would have no expert evidence of the current value of the wife’s business and no proper ability to determine the asset pool in the case.
As to the husband’s objection to the Mr G evidence, counsel for the husband conceded that the issue is really one of weight rather than admissibility. He did not press any objection to Mr G’s qualifications or competence to give an expert opinion.
In order to resolve the wife’s objection to Mr H’s reports, the husband’s counsel was given an opportunity to call Mr H to adduce evidence from him on the discrete issue of his qualifications and experience in the field of business valuations. This approach was adopted because the requirement that an opinion be based “wholly or substantially” on the “specialised knowledge” of an expert witness is a precondition of admissibility under s 79 of the Evidence Act1995 (Cth) which is to be established by the party tendering evidence[26]. Counsel for the applicant wife was afforded an opportunity to cross examine Mr H on this discrete issue.
[26] Dasreef Pty Ltd v Hawchar [2011] HCA 21 at [90]
After hearing this preliminary argument and the evidence from Mr H about his experience and expertise in business valuation, I ruled against the wife’s objection and gave reasons ex tempore.
The wife’s expert Mr G
In November 2019 Mr G concluded that the business should be valued at $57,129[27]. Based on his examination of available financial records he concluded that the net tangible assets of the business were negligible, there were no positive earnings before interest and tax (EBIT) and no goodwill. He concluded that the business basically existed to provide a reasonable wage for the owner and that it had no value as a going concern. The value he attributed was essentially the net asset backing of the business as it stood.
[27] CB, p 144
In September 2020, Mr G rejected a “value to owner” valuation prepared by Mr H (discussed below), but indicated that he was prepared to agree to an updated net asset valuation of $73,057, subject to seeing the most current balance sheet.
On 17 January 2022 Mr G provided an updated report, confirming his previous methodology and on this occasion valuing the wife’s interest in the business at $56,948 which was represented mainly by cash. This net asset valuation was arrived at after adjusting the 30 June 2020 balance sheet to remove the wife’s loan balance and the book value of recent building improvements to derive a value. Mr G reiterated that there was no goodwill in the business.
When called to give evidence, Mr G confirmed that he had prepared a further set of calculations which took into account the profit and loss information for the business extended to the year ended June 2021. He confirmed that the source of information for this calculation was the financial statements provided during the last 2 or 3 years, including figures used in the report prepared by Mr H for the year ended June 2021.
In chief, Mr G said that having viewed the draft accounts for 30 June 2021, nothing caused him to alter any of the conclusions that he had reached in his earlier reports. Mr G observed that the final two years, 2020 and 2021, revealed, on average, negative earnings before interest and tax and, for that reason, no viable EBIT which could be capitalised to arrive at any value of the business or goodwill.
Mr G said that he had given an opinion of the intrinsic value of the business, rather than any market value.[28] He explained that he had produced an objective valuation based on the notion of a rational hypothetical purchaser meeting with a rational hypothetical vendor, both possessed of the same information and both intent on acting in a rational manner. He said that his valuation was based on what the rational purchaser would be prepared to pay and what the rational vendor would accept. One of the relevant considerations in such a hypothetical exchange of critical information would include the true profit of the business after remunerating the owner. The price to be paid by a rational purchaser would be derived by capitalising the true profit by the capitalisation rate. Based on that analysis a business with no viable EBIT would be considered unsaleable as a going concern.
[28] Transcript of 15 February 2022, p 151
Mr G agreed that one point of distinction between his valuation and the valuations undertaken by Mr H was that Mr H had looked at comparative market sales of businesses, whereas he had not. Mr G said that he did not need to look at comparative sales under his valuation methodology.[29]
[29] Transcript of 16 February 2022, p 2
Mr G also agreed that he had not undertaken any market research to establish how much potential purchasers are paying for businesses in Victoria. He accepted that there have been sales of businesses with a similar turnover and he also accepted that when they go on the market the income of the proprietor is a factor that is taken into account in calculating the market price. Mr G also conceded that in Australia small businesses often (or at least sometimes) change hands on the basis of the purchaser “buying themselves a job” where the value of the business is derived by applying a multiplier to the proprietors’ wages.
Nonetheless, Mr G remained steadfastly of the view that the approach taken by Mr H was flawed.
Mr G was invited to offer an opinion on Mr H’s conclusion that a fair market value on an adjusted balance sheet is $224,820. Cross-examination revealed that in terms of a “net asset value” approach to valuation, a material difference between Mr G and Mr H was that the latter had added back to the balance sheet the $105,837 expensed on renovations in the 2020/2021 financial year and allowed for amortisation of that expenditure over a 5 year life of the asset ($21,167 per annum). Mr G accepted the legitimacy of amortisation for the purposes of deriving a true profit, but he did not agree that the total expenditure should be added back to the balance sheet as a capital item in order to determine net assets.
Mr G said that the expenditure of $105,000 which had been expended on repairs and maintenance shortly prior to the end of the 2021 financial year should not be accounted under “property” on the balance sheet because improvements to the premises, albeit paid for by the wife’s business, would remain the property of the landlord and the capital value of those improvements do not accrue to the tenant in the long run. For that reason, in considering the value of the business, Mr G considered that the expenditure on improvements should be regarded as a revenue expense (i.e. an expense of doing business) not a capital spend.
Notwithstanding the above evidence, Mr G said that the net asset value of the business is just over $189,000, comprising the net asset backing of the business as at June 2021 of $182,486 plus a director’s loan of $7,000 (which should be seen as a liability because it is owed to the wife).[30]
[30] Transcript of 16 February 2022, p 10
When re-examined, it came as no surprise that Mr G was invited by the wife’s counsel to reconcile his answer in cross-examination that the net asset value of the business as at June 2021 was $189,486 with the evidence in his report of 17 January 2022 where he opined that the net asset value as at June 2020 was $56,948. Mr G said that in the valuation he gave during cross examination he had failed to deduct $63,444 and property improvements which he had excluded for the 2020 valuation. His evidence during re-examination was that the 2021 net asset valuation should be approximately $126,000 (i.e. $182,000 plus $7000 being the add‑back of the loan to the wife less $63,443 on property improvements). I found this evidence confusing and inconsistent.
Mr Williams, counsel for the husband, objected to continued re-examination on the basis that it was in effect cross-examination of the witness with a view to impugning his own evidence. In the absence of the witness, Mr Williams submitted that the re-examination was directed to undermining the credibility of the wife’s own witness and that Mr G was bound by his answer in cross-examination.
By reason of the late filing of the husband’s expert report which contended for an asset valuation of $224,820, I permitted Mr Hutchings to ask some further questions to clarify exactly what Mr G contended was the proper net asset value of the business and to explain the methodology he used to reach that conclusion. After some further reflection on the state of the balance sheet, Mr G opined that the net asset value of the business was closer to $95,000.
In answer to a question from the bench about the value of capital improvements to the business owner when the property is owned by another party, Mr G said that any such expenditure does not necessarily improve the value of the business because all of the value stays with the owner of the property. However, he clarified that if property improvements were transferable with the business and gave an incoming purchaser a head start rather than having to make the improvements themselves, a rational purchaser probably would be prepared to pay for the improvements if assured of their use. Mr G agreed that if the property and the business were transferred together, there is a case for saying that the expenditure on property improvements does have a value to a purchaser. He agreed that when the owner of the business and the property are one and the same, then the owner of the business would derive a significant benefit from the expenditure on capital improvements.[31]
[31] Transcript of 16 February 2022, p 18-19
Counsel for the father was afforded the opportunity to ask some further questions of Mr G. Mr G accepted without reservation the proposition that if the business had a lease, the improvements that have been made to the property would make it more saleable in the marketplace and more attractive to a purchaser. Notwithstanding, he maintained his view that if a purchaser approached him for a valuation of the wife’s business he would say “this business is worth nothing”.[32]
[32] Transcript of 16 February 2022, p 20
The husband’s expert Mr H
Initially, in November 2019 Mr H valued the business at $60,288 on a fair market value basis[33]. In that report he observed that businesses are location-based businesses and without a written lease the business would be of no interest to a purchaser and was basically unsaleable. Mr H opined that the value of the business was to be found only in its assets and for that reason he initially selected the Net Asset Backing method to determine a market valuation.
[33] CB, p 491

Y presented as a child inclined to anxiety and shyness, as a result of having been exposed to her parental hostility for most of her life. Y displayed a tendency to feel that she must compare the parents and choose between them. Dr J observed that this was consistent with the common dilemma for children in high conflict families. While Y was inclined to express a strong view about not wanting to spend additional time with her father, Dr J’s view was that these feelings did not relate to any risk of physical or emotional harm in the father’s care, but were probably the consequence of Y having been exposed to negative attitudes about her father.
Dr J concluded again that a cooperative relationship with the parents was unlikely and that communication difficulties encountered during their relationship were not likely to improve through their separation. Because conflict of loyalty continues to weigh so heavily on the children, Dr J did not consider it appropriate for additional time with the father to be dependent on the expression of any request by the children, as requests are rarely made due to the fear of disapproval by the other parent.
Dr J supported Mr Farlow’s proposal for weekend time to extend into Monday morning, at the commencement of school. In addition, to avoid too frequent changes and transitions between the parents, Dr J considered it might be better if the arrangements for the children included Thursday after school until Monday morning each alternative week and Thursday overnight every other week.
Dr J also expressed concern about the children’s reports and behaviours around questions about attending for psychological therapy and about potential risk of clinicians causing unwitting harm if not aware of parental motivations. For this reason, Dr J recommended against the children seeing any allied health practitioners unless there is consultation and agreement between the parents.
Cross examination by the applicant mother
In framing his cross examination, counsel for the applicant mother confirmed that the positions of the parties had narrowed substantially and these positions were described to Dr J.
Dr J said that she did see a necessary link between Y’s anxiety and difficulties with implementing arrangements for increased time with the father time. Dr J said that there may be other factors involved in Y’s anxiety.
Dr J also explained in some detail her concerns about the children being exposed to psychological therapy with Ms V. Dr J said that she was concerned that the children had perhaps been taken by the mother to Ms V with an agenda in mind. One piece of evidence going to that concern was Y’s explanation as to why she had attended Ms V, namely “it was to tell her that we don’t like going to dad’s”[90].
[90] Family Report dated 25 November 2021, p 11
Dr J opined that Ms V may have overstepped her role and ethical position as a psychologist by making recommendations about the children’s arrangements, particularly in family law proceedings where she had not met everyone in the family. She also said it was not appropriate for Ms V to make assumptions about the father based on what she had been told by the children because they came from high conflict family and faced loyalty conflicts. Dr J stated frankly that she did not like Ms V’s report and considered it worthless.
Dr J confirmed that the two children in this case very much present as living in high conflict family pre-and post-separation[91]. When questioned about the source of conflict between the parents, Dr J described the father as a difficult character who had communication problems and was difficult to understand. She said that living with the father “would probably do anyone’s head in"[92] and that she did not hold the mother solely responsible for the conflict.
[91] Transcript of 16 February 2022, p 84
[92] Transcript of 16 February 2022, p 85
Dr J observed that the mother appeared very responsive to children and listens to them. However, while the mother likes to listen to children she might not appreciate that her feelings towards the father might colour their views. Dr J opined that the children might be telling the mother what she wants to hear.
Dr J said that the real issue regarding spend time arrangement is not the number of nights, rather it was about ensuring fewer transitions and easier transitions for the children.
Explaining why the recommendations in her second report differed from those in the first, Dr J said that the mere fact that the parties had returned to her for a further assessment was evidence that the first recommendations had been unsuccessful and reinforced her prognosis for the parents agreeing about anything was very poor[93]. Dr J predicted that the parents were probably going to continue arguing and fighting and disagreeing into the future. This informed her decision to recommend fewer transitions for the children, where the parents would be kept apart and school would serve as the main way the children would move between households.
[93] Transcript of 16 February 2022, p 87
Dr J disagreed that the spend time arrangements proposed by the father would have a dramatic impact on Y. She observed the children to have a very similar behaviour with each parent and she did not accept that Y has a stronger attachment with the mother than the father. Nonetheless, Dr J said that if Mr Farlow accepts that a slower introduction for Y might be in her best interests, she sees nothing wrong with a stepped approach. In Dr J’s opinion, the most important thing is that the parents agree.
Cross-examination by the respondent husband
In response to a question from the wife’s counsel, Dr J reiterated that she did not think

Ms Gare fully appreciates the influence she has on her children and what they might tell her. She accepts that Ms Gare genuinely loves the children and is worried about them when she sees that they are uncomfortable and distressed or upset. However, in Dr J’s opinion, the mother does not really have an appreciation of the children’s relationship with their father.
Dr J was asked about the father’s proposal that the children increase time at the same pace. Dr J said that X and Y have a very strong sibling relationship, despite their different genders, different ages and different interests. She considers it very important that they have shared experiences. Being separated and being exposed to different experiences with each parent runs the risk of breeding jealousy and competition, including as between the parents. Spending time together is conducive to a better relationship between siblings. Dr J also added that treating Y differently, for example by spending less time with the father, is likely to send the message to her that she is a child who cannot cope with change. This may have an impact on her self-esteem and confidence and will only reinforce the narrative around her being vulnerable.
Dr J reiterated that in terms of spend time arrangements, the most important thing for the children is a reduction in the face-to-face contact between parents and a reduction in changeovers for them. She accepts that parental contact cannot be eliminated, but the objective of any spend time arrangement should be to minimise contact.
CONSIDERATION OF THE STATUTORY REQUIREMENTS
Parental responsibility
The parties agree that they should have equal shared parental responsibility.
Primary considerations
The evidence unambiguously supports a finding that the children currently have a meaningful relationship with both parents[94]. Both parents expect that relationship to continue over the long-term. Whilst the parents lived separately and apart under the same roof, they shared the care of the children. The father now seeks to increase his time with the children in the expectation that will provide them with the opportunity to grow their relationship with him.
[94] S 60CC(2)(a) Family Law Act 1975 (Cth)
Dr J expressed the opinion that the parental relationship may be fractured, and the children’s relationship and communication with each parent might vary, but the children enjoy good relations with each of them. The critical issue is to ensure structured spend time arrangements which minimise opportunities for conflict between the parents and which allow the children to be fully immersed and engaged with the parent with whom they are spending time.
As to the need to protect the children from harm[95], the wife has deposed to family violence perpetrated by the husband against her during the marriage, which she says occurred in the presence of the children. However, she does not allege that the husband has exposed the children to abuse or family violence since separation and does not allege that there is a risk of this occurring.
[95] S 60CC(2)(b) Family Law Act 1975 (Cth)
The father has expressed concerns regarding the mother’s parental capacity arising from her new intimate relationship and the potential impact on the children. There is no evidence before the Court which suggests that this is a risk factor.
Additional considerations
Views of the children s.60CC(3)(a)
The wife’s case is that X has expressed satisfaction to the family report writer about the current spend time regime, being every Wednesday evening from the conclusion of school until 8.00pm and each alternate weekend from the conclusion of school on Friday until 7.00pm on Sunday. On the other hand, the wife says that Y has struggled with that regime and has expressed concern that spending more time with her father would cause her to be upset
The father relies on the two family reports prepared by Dr J and her observation that the children react warmly towards and have a positive relationship with their father. The two reports are more than 16 months apart and in that time it was observed that the childrens’ relationship with their father had continued to grow and develop.
The two children are young, one still at primary school and the other just commencing secondary school. Dr J noted that they are very conscious of the parental conflict, including disagreement about how the children should spend time. In terms of having regard to the children’s wishes, Dr J powerfully cautions against placing weight on what each child may say to each parent. In this case, the children are confronted with loyalty conflict and this may result in them telling parents what they want to hear, fearing disapproval if they say the wrong thing. There is a significant risk that the views expressed by the children will be influenced by these pressures and are an unreliable indicator of what they truly feel.
In my view, the views of the children must be given limited weight in light of the above observations. The view which the Court does accept is that each of the children enjoys a good relationship with each of the parents.
Nature of the relationship of the children with each of the parents and other persons s.60CC(3)(b)
The children primarily reside with the mother and have a stable and secure relationship with her. They also have a stable and comfortable relationship with their father which has continued to develop since separation based on the spend time arrangements.
They also appear to have a good relationship with the paternal grandmother in whose residence they live when spending time with the father. Issues between the parents, while causing emotional conflict for the children, do not appear to impinge upon their ability to relate well with each parent individually.
The mother expresses concern that the husband’s living arrangements do not provide an optimum environment for developing his relationship with the children. The father acknowledges these concerns and accepts that his relationship with the children can only improve once he has his own residence, which he anticipates will be near the children’s school and will be of at least three bedrooms, so that the children will have privacy as they grow. This appeared a sensible and insightful concession at the time as it was based on agreement as to the dissatisfaction of the children (for various reasons) about the grandmother’s home.
The critical questions for the Court are whether an increase in the father’s time with the children should commence for both children upon the husband finding new suitable premises and whether Y’s time should be delayed.
The mother’s position remains that the children’s time with the father should increase only once he secures suitable accommodation. It was submitted that from the mother’s perspective it does not matter whether the father rents or buys and she does not seek to hinge any orders on that distinction. Rather, the important point for the mother is that increased time should only start once the father occupies his own home with sufficient bedrooms to accommodate the children.
Although initially the father sought an immediate increase in time spent, he has acknowledged a preparedness to accept that this occur upon him obtaining his own residence, whether it be rental or otherwise. His evidence is that upon determination of these proceedings, he will vacate the paternal grandmother’s residence and continue to live in the local area.
The extent to which each of the children’s parents has taken, or failed to take, the opportunity to participate in making decisions about major long-term issues, to spend time with the children and communicate with them s.60CC(3)(c)
The mother contends that during the relationship the husband spent minimal time with the children and failed to participate in making decisions about long-term issues affecting the children. She concedes that since separation the husband has taken more opportunity to spend time and communicate with them and she concedes that the father/child relationships have improved significantly.
On the other hand, the father submits that historically both he and the mother have participated in making decisions about long-term issues in relation to the children. Post-separation the children have lived with the mother and spent regular time with the father in accordance with interim parenting orders. The father has continued to communicate with the children when they are in the mother’s care.
I am satisfied on the evidence that both parents wish to and are capable of making decisions about the children’s welfare and both parents are desirous of spending significant quality time with the children as they grow and develop. There has never been an issue regarding the parents’ desire for equal shared parental responsibility. Furthermore, the consensus that the children should spend more time with the father is consistent with the confidence that each parent has in the other they can both act in the children’s best interests.
The extent to which each of the children’s parents has fulfilled, or failed to fulfil, the obligations to maintain the children s.60CC(3)(ca)
This particular consideration does not weigh heavily in relation to the issues which fall for determination. Despite the numerous issues raised in the trial affidavits filed by the mother and the father, for example in relation to the performance of domestic duties prior to separation or the payment of child support after separation, I do not take either party to be submitting that the other has failed to maintain the children or act in their best interests.
The likely effect of any change to the children's circumstances including the likely effect on the children of any separation from either of his/her parents or any other party (including any grandparent or relative of the child) with whom he/she has been living s. 60CC(3)(d)
The expert opinion of Dr J and the consensus of the parties is that an order should be made for increased time. The consensus view is that that time should move from three overnights per fortnight to five.
The father asserts that an increased time regime will provide greater stability and routine for the children than is otherwise provided by the current arrangements. On the proposal advanced by the father increased time will involve fewer transitions between the parents and, utilising school as the point of change over, fewer face-to-face interactions between the parents. These objectives are consistent with the recommendations made by Dr J in each of her first and second family reports.
The further issue which arises for consideration here is whether the spend time arrangements for the two children should be aligned or whether some graduated process should be adopted for Y.
The mother’s case, as has been articulated, is that Y is an anxious child and that any increase in time will cause her stress and adjustment difficulties. The mother submits that the separation caused between mother and child when Y spends time with the father has a detrimental impact on her, as evidenced by Y’s requests to come home or her complaints about the father’s behaviour.
The father acknowledges that the mother has legitimately held concerns for the welfare of Y and her capacity to move to a new regime. He has indicated a preparedness to move to a graduated process, but with the children’s spend time arrangements to be aligned within six months.
Dr J’s evidence about the impact of any changed arrangement is instructive. She says that the views expressed to the mother by Y are not necessarily reliable because of the tendency of the children to tell each parent what they want to hear. Secondly, Dr J points to the importance in this case of the siblings moving in tandem and sharing experiences as they develop. Any separation between siblings brought about by staggered spend time arrangements risks possibility of undermining the sibling bond and leaving one or other child to speculate about why they are being treated differently.
There is no evidence that moving from the paternal grandmother’s home to a different residence will cause any harm for the children. In fact, it is expected to be beneficial for them.
The practical difficulty and expense of the children spending time and communicating with the parent and whether that difficulty of expense will substantially affect the children's right to maintain personal relationships and direct contact with both parents on a regular basis s 60CC(3)(e)
The father submits, and I accept, that there are no concerns as to the practical difficulty and expense of the children spending time with either party.
The parties live in relatively close proximity to each other and to the children’s school. Both parties have sufficient means to meet the children’s needs when they have care of them.
The father works full-time but he has given evidence that his new employer is prepared to allow a level of flexibility in his working hours which will permit him to take the children to school. The father has proposed a partner should be permitted to do drop-offs or pickups in the event he re-partners, a proposal which should further enhance the ability of the parents to accommodate any difficulties which might otherwise arise.
The capacity of each of the parents and any other person to provide for the needs of the children, including emotional and intellectual needs s.60CC(3)(f) and the parents attitude to the children and to the responsibilities of parenthood s.60CC(3)(i)
In relation to this consideration, the father submits that he is an active father who has provided for the needs of the children since they were born and that he will continue to do so. I accept his evidence in this respect.
The mother’s trial affidavit contains a litany of allegations that the father has fallen short in providing for the needs of the children and in terms of the attention he has given them in the past. The thrust of the wife’s evidence is that the husband had very little involvement in the day to day care of the children, either due to his working commitments or his propensity to withdraw to the “man cave” where he hosted friends and engaged in long drinking sessions. These allegations seek to portray the father in a bad light and they reflect a level of antipathy aimed at diminishing his overall contribution to parenting and domestic life, a consistent theme of the wife/mother’s position in this litigation.

In her reports, Dr J cautions that the mother’s account of a problematic or non-existent relationship does not accord with the children’s own experience of their father. Dr J expressed the view that the children have probably been exposed to negative views about the father, but that should not be taken as evidence of the children’s lived experience.
I am satisfied that each of the parents has the capacity to provide for the needs of the children including their emotional and intellectual needs. In so far as the emotional needs of either of the children can be better met with counselling, is open to the parents to discuss and agree on a professional who might be engaged to provide that assistance.
Whether it will be preferable to make the Order that will be least likely to lead to the institution of further proceedings in relation to the children s.60CC(3)(l)?
It is preferable for the Court to make an Order that will be least likely to lead to the institution of further proceedings. Neither party contends otherwise.
RESOLUTION OF THE OUTSTANDING ISSUES.
In considering the parties’ competing parenting proposals, I have had regard to the evidence, the parties’ oral and written submissions and the statutory considerations which inform my view as to the best interests of the children.
Subject to the matters discussed below, I will make an order that the children live with the mother and spend time with the father during school term as follows:
(a)In week 1, from the conclusion of school (or 3.30pm if a non-school day) Thursday until the commencement of school Friday (or 9.00am if a non-school day); and
(b)In week 2, from the conclusion of school Thursday (or 3.30pm on a non-school day) until the commencement of school Monday (or 9.00am if a non-school day).
From when should the children spend increased time with the father from three overnights per fortnight to five per fortnight?
The increased time arrangement should commence from the time the father obtains his own residence, subject to that residence having a separate bedroom for each of the children.
It matters not whether the accommodation is rented or owned by the father. The condition for the commencement of increased time is that the accommodation is suitable and that it is appropriate to ensure that each of the children has a separate bedroom when they spend time with the father.
Until the father obtains that accommodation, the current live with and spend time regime will continue.
Whether the commencement of increased time should be conditional on the father obtaining his own residence and such residence having a separate bedroom for each child?
This issue is resolved by my ruling in relation to the previous question.
Although the report of Dr J is silent in relation to whether the children should each have their own bedroom, the evidence persuades me that it is in the best interests of the children that they do so. During cross-examination the father indicated that he envisaged any future accommodation secured by him will be configured so that each of the children have their own room and privacy. There was an implicit, if not explicit, recognition on his part that privacy at their age and going forward is an important element of their emotional well-being.
Should there be a slower progression of time for Y?
In the father’s third Amended Initiated Response, he seeks for both children to spend immediate increased time together. As has been discussed, the wife seeks a slower progression for Y, graduated over a period of two years.
My impression at the conclusion of the trial, based on the evidence of the husband and closing submissions made on his behalf, was that the father was content, for the purposes of compromise, to agree to an arrangement whereby for the first three months Y’s time would continue at three nights per fortnight, for the second three months her time would increase to four nights per fortnight and after six months her time would align with X’s spend time.
In further written submissions dated 9 August 2022, counsel for the mother contends that the father had resiled from the position advanced on his behalf by his counsel in his final address. That submission has substance and I agree that the father has not advanced any explanation for having done so. It was significant in my mind that when the compromise position emerged during the father’s cross examination he indicated a distinct willingness to proceed on that basis.
I have to observe that Dr J was not flushed with enthusiasm about the prospect of the children’s time graduating at a different pace. As mentioned earlier, she expressed strong views about the importance of the sibling relationship, shared experiences and the possibility that one sibling, if treated differently to the other, might be impacted adversely by the distinction.
Nonetheless, Dr J conceded in cross-examination that if the father was prepared to accept that a slower introduction for Y might be in her best interests (as he appeared to do in cross-examination), she saw nothing wrong with a stepped approach. Critically, in Dr J’s opinion, the most important thing is that the parents agree about something.
I am satisfied that an immediate move from three to five nights per fortnight may cause some anxiety for Y, a prospect which the father acknowledged in cross examination. While I am of the view that the childrens’ time should be aligned as quickly as possible, I see no harm in a short graduated transition over six months if that might mitigate some of the risk for Y.
I am strongly of the view that it is in the best interests of the children to adopt the position which I understood was all but agreed at the end of the trial. Accordingly, I will order that Y’s time with the father increase as proposed in the draft minute of order attached to the wife’s Further Written Submissions dated 9 August 2022.
Whether there should be an order made requiring the father to personally deliver the children to school not later than 30 minutes prior to commencement?
The mother’s evidence that the father left for work before 7.00am during the marriage has been superseded by his evidence that his new employer is prepared to extend flexibility to enable him to take the children to school. In my view, there is no persuasive evidence to suggest that in his current employment the father is not capable of personally delivering the children to school at a reasonable time.
During his evidence the father eschewed any intention to rely upon before-school care. Moreover, during cross-examination the father said that he would agree to an order that he personally deliver the children to school no more than 30 minutes prior to the commencement of the school day, save that he sought some flexibility so that if he re-partners in the future his partner can deliver the children to school. I note that the mother is prepared to accommodate that flexibility.
I will order that the husband or another adult member of his household deliver the children to school not more than 30 minutes before the start of each school day. I will otherwise adopt the wording proposed in the mother’s draft minute. In my view, the caveat that the parties may agree to an alternative arrangement in writing if the father is caught short is appropriate.
Whether an order should be made requiring the parents to enrol Y in counselling and, if so, the conditions which should pertain to that counselling?
I do not intend to make an order which compels the parties to arrange for Y to attend upon an agreed psychologist for counselling.
I note during the course of cross-examination, the father did not oppose the idea of Y attending upon a psychologist, provided it was not a psychologist with whom the mother had prior dealings, and that he be involved in the process. However, the father’s non-opposition to counselling is not evidence that it is required nor of compelling reason why the Court should make an order that it occur.
I need not restate Dr J’s concerns about the risks to a child of counselling by someone other than an appropriately qualified and experienced psychologist. Those observations have no doubt put the father on guard and explain why if a counsellor is to be engaged in the future he would want to approve of the professional and be involved in the process.
While I accept that Y suffers some anxiety, I am not satisfied on the evidence that counselling should be mandated by order of the Court. Rather, in circumstances where the parties agree that they should have equal shared parental responsibility, and each assert that they have the competence and capacity to parent effectively, it is incumbent upon them to discuss and agree on important decisions which impact upon the emotional and physical well-being of their children. If one or other of the parents believe that Y would benefit from counselling, the parties should demonstrate sufficient maturity and responsibility as parents to discuss her welfare and come to an agreement as to how her needs are best met.
Arrangements for school term holidays
The parties agree that the children should spend one week with the father during school term holidays.
The order sought by the father is that his time with the children should always commence at the conclusion of school on the Friday before the commencement of the holidays. The mother, on the other hand, seeks that the father’s time should commence on the weekend that the children would ordinarily spend with him during the school term, so as to maintain their routine.
The father has not made any specific submissions in relation to this issue and I agree with the mother that there is no apparent or obvious reason why the first week of the children’s holidays should always be with him.
There are advantages and disadvantages to the proposals which have been put forward by each party. Depending on the timing of school holidays there is always a risk that the children will spend consecutive weekends with one parent to the disadvantage of the other and in my view the father’s proposal increases that risk.
Predictability and routine should be a key objective of orders made for the benefit of X and Y. In my view, predictability is best maintained if during school holidays, time commences with the father on the Friday of the weekend the children would ordinarily have spent with him under the ordinary school term arrangement. That time with the father should then continue until 5.00pm on the following Saturday. I will of course make provision for the parties to reach an alternative agreement.
Arrangements for long summer holidays
In his written submissions, counsel for the mother reminded the Court of Dr J’s strong recommendation that the number of changeovers should be kept to a minimum, wherever possible. In the particular circumstances of this case, reducing face-to-face contact between the parents and the frequency of transitions for the children were important considerations underpinning other orders, including those increasing the children’s time with the father.
The likelihood of face-to-face contact between the parents will be greater outside school term time. The proposal advanced by the father which would involve the children changing homes every three or four days is unduly complicated and contrary to the objectives described above. I do not consider that proposal to be in the children’s best interests and therefore I will make orders in the terms sought by the mother, which will involve the period between the end of the school year and 2 January being divided in half.
Arrangements for special occasions
A key objective of orders made by the Court is that a meaningful relationship should be maintained between the children and their parents. Integral to that is that the children should be entitled to celebrate their birthdays and other special occasions in a meaningful way.
I note that the father has not advanced any submissions in relation to this issue. The wife submits that the period between 10.00am and 2.00pm on these days should be sufficient to allow a parent to arrange a party or the like without unduly impinging on the other parent’s time.
This issue only relates to non-school days. In my view the wife’s proposal is unduly restrictive and does not enable the children to enjoy a sufficient block of time to enjoy the occasion. The significance of the occasion should not be overwhelmed by an unnecessarily tight timeframe. It is always open to the parents to reach a sensible agreement, but in default of agreement, I will order that on birthdays the children spend time with the parent they would not otherwise be spending the night with from 10.00am until 4.00pm.
COSTS
The wife sought an order for costs against the husband in these proceedings.
It is not appropriate to deal with costs until after delivery of judgment and the parties have had an opportunity to consider and reflect on these reasons. My orders will make provision for any application for costs to be filed and served within 28 days.

I certify that the preceding four hundred and eighty-one (481) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Forbes.
Associate:
Dated: 17 February 2023

File number:	MLC 10265 of 2019
Judgment of:	JUDGE FORBES
Date of judgment:	17 February 2023
Catchwords:	FAMILY LAW –PROPERTY – application for adjustment of property interests – establishing the asset pool – valuation of wife’s business – whether business to be valued according to net asset backing, capitalised earnings or “value to owner” – evaluation of competing expert evidence – whether loan repayment to wife’s father to be added back – whether parties have made proper financial disclosure – initial contributions of one party greater than the other – consideration of future needs including income earning potential of each party – whether superannuation disparity taken into account – where property adjustment just and equitable FAMILY LAW – PARENTING – application for increased time with father – consideration of children’s wishes where loyalty conflict exists – whether increased time for siblings should be aligned or staggered – consideration of conditions for increased time and best interests of the children
Legislation:	Evidence Act 1995 (Cth), s 79 Family Law Act 1975 (Cth), s 60CC, 75, 79 Federal Circuit and Family Court of Australia Rules 2021, r 6.06 Federal Circuit Court Rules 2001, r 24.03
Cases cited:	Aitken and Murphy [2013] FamCA 3 Bevan v Bevan [2013] FamCAFC 116; (2013) FLC 93-545 Black & Kellner (1992) 15 Fam LR 343 Calverley v Green (1984) 155 CLR 242 C & C [1998] FamCA 143 Chapman & Chapman [2014] FamCAFC 91 Chick & Chick [1987] FamCA 69 Dasreef Pty Ltd v Hawchar [2011] HCA 21 Dickons & Dickons [2012] FamCAFC 154 Fields & Smith [2015] FamCAFC 57 G & G (1984) FLC 91-582 Guinti and Giunti (1986) 11 Fam LR 160 at 165; [1986] FLC 91-759 Harrison & Harrison (1996) FLC 92-682 Hickey v Hickey & Attorney-General of the Commonwealth (Intervener) (2003) FLC 93-143 In the Marriage of Briese (1985) 10 Fam LR 642; (1986) FLC 91-713 Lee Steere & Lee Steere [1985] FamCA 57 AJO & GRO (2005) 33 Fam LR 134 Reynolds & Reynolds (1985) FLC 91-632 Scott & Scott (2006) FamCA 1379 Spencer v The Commonwealth of Australia (1907) HCA 82; 5 CLR 418 Stanford & Stanford (2012) 247 CLR 108 Taylor & Taylor & Taylor [2000] FamCA 308 Turnbull & Turnbull (1991) FLC 92-258 Vass & Vass [2015] FamCAFC 51 Warne & Warne (1982) 8 Fam LR 388 Wallis & Manning [2017] FamCAFC 14 Weir & Weir (1993) FLC 92-338; (1992) 16 Fam LR 154 Wilde & Wilde [2007] FamCA 1044 Wender & Wender [2017] FamCAFC 48
Division:	Division 2 Family Law
Number of paragraphs:	481
Date of last submissions:	9 August 2022
Date of hearing:	14 – 17 February 2022
Place:	Melbourne
Counsel for the Applicant:	Mr Hutchings
Solicitor for the Applicant:	Garland Hawthorn Brahe
Counsel for the Respondent:	Mr Williams
Solicitor for the Respondent:	Cohrssen Partners Pty Ltd

MLC 10265 of 2019
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN:	MS GARE Applicant
AND:	MR FARLOW Respondent

order made by:	JUDGE FORBES
DATE OF ORDER:	17 FEBRUARY 2023

ASSETS
Description	Ownership	Applicant’s value	Respondent’s value
1.	B Street, Suburb C[9]	Joint	$2,175,000	$2,175,000
2.	D Street, Town E[10]	Husband	$550,000	$550,000
3.	Westpac Classic Plus Account ending in #...97	Joint	$4,291	$4,291
4.	Motor Vehicle 1	Wife	$70,000	$75,000
5.	Motor Vehicle 2	Husband	$50,000	$45,000
6.	Applicant wife’s savings	Wife	Unknown	Unknown
7.	Westpac Choice Account ending in #...85	Husband	Unknown	$178
8.	F Pty Ltd	Wife	$56,948[11]	$429,500[12] or $224,820[13]
9.	Funds withdrawn by wife for “loan repayment” to father (to be added back)	Joint	Nil	$106,682
10.	Household chattels	Wife	$5,000	$80,000
11.	Shed items retained by husband	Husband	$80,200	$28,400
Assets subtotal			$2,991,439	$3,494,051[14] *$3,289,371*[15]
LIABILITIES
12.	Westpac Rocket Repay Home Loan (Mortgage)	Joint	$393,858	$393,858
13.	ANZ Visa Credit Card	Husband	E$9	E$9
14.	Westpac Bank Credit Card	Husband	E$9,222.23	E$9,222.23
15.	Credit Cards	Wife	$2,434	$2,434
16.	Loan from the wife’s father	Wife	$183,090	NIL
17.	Loan from the husband’s mother	Husband	NIL	$196,000
Liabilities subtotal			$588,613	$601,523
SUPERANNUATION
18.	Super Fund 1	Wife	E$388,746	E$388,746
19.	Super Fund 2	Husband	E$323,892	E$323,892
Superannuation subtotal			$712,638	$712,638
TOTAL (assets – liabilities)			$2,402,626	$2,892,528 *$2,687,848*
TOTAL (assets – liabilities + superannuation)			$3,115,264	$3,605,166 *$3,400,486*