GILBERT & GILBERT
[2011] FMCAfam 1018
•21 September 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| GILBERT & GILBERT | [2011] FMCAfam 1018 |
| FAMILY LAW – Property – add backs – s.75(2) factors in wife’s favour – credit. FAMILY LAW – Spousal maintenance – wife’s earning capacity – husband’s capacity to pay. CHILD SUPPORT – Grounds for departure established. |
| Family Law Act 1975, ss.72, 74, 75(2), 79(4) Child Support (Assessment) Act 1989, s.117 |
| NHC & RCH (2004) FLC93-204 Gyselman & Gyselman (1992) FLC92-289 |
| Applicant: | MR GILBERT |
| Respondent: | MS GILBERT |
| File Number: | ADC 1267 of 2009 |
| Judgment of: | Kelly FM |
| Hearing dates: | 5, 6 August, 14 October, 26, 27 November 2010, 3 March 2011 |
| Date of Last Submission: | Written submissions received April 2011 |
| Delivered at: | Adelaide |
| Delivered on: | 21 September 2011 |
REPRESENTATION
| Counsel for the Applicant: | Ms D Morosini (now self represented) |
| Solicitors for the Applicant: | Di Morosini & Co |
| Counsel for the Respondent: | Ms N Hurley |
| Solicitors for the Respondent: | Clelands |
ORDERS
The net matrimonial asset pool be divided as to the wife 60% and to the husband 40% in the following manner:
(a)the wife retain the net proceeds of sale held in her solicitor’s trust account arising from the sale of the former matrimonial home;
(b)the monies deposited into Court pursuant to the Notice of Payment into Court filed 19 May 2011be divided as follows:
(i)as to the husband the sum of $68,148, less any arrears of Child Support outstanding as at 21 September 2011;
(ii)the balance remaining to the wife.
(c)The husband retain his business [I] for his sole use and benefit absolutely free from any further claim by the wife;
(d)The husband retain the [B] shares and indemnify the wife with respect to any liability associated with those shares;
(e)The wife do all things necessary to transfer her interest in the [B] shares to the husband at his expense;
(f)The wife retain the [F] motor vehicle and if necessary, do all things necessary to discharge or refinance the existing loan over that vehicle into her sole name at her expense;
(g)The husband retain the [B] motor vehicle in his name and if necessary, do all things necessary to discharge or refinance the existing loan into his sole name at his expense;
(h)Each party retain all such other assets, including household furnishings and effects, jewellery and bank accounts in their name;
(i)Pursuant to s.90MT(4) of the Family Law Act 1975 (as amended) the Court allocate to the wife the specified amount of $14,500 out of the husband’s splittable interest in the [G] Superannuation Fund and:
(i)pursuant to s.90MT(1)(a) whenever the Trustees make a splittable payment out of the husband’s interest in the [G] Superannuation Fund the Trustees shall pay to the wife the entitlement calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001 using the base amount of $14,500 and that there be a corresponding reduction to the entitlement that the husband would have had in this Fund but for this order;
(ii)this order has effect from the operative time;
(iii)the operative time shall be the fourteenth business day after publication of this order.
(j)The parties in their capacity as Trustees of the [G] Superannuation Fund shall do all such acts and things and sign all documents as shall be necessary so that in accordance with the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001 the Trustees can calculate the entitlement of and make payment to the wife in accordance with this order.
(k)Upon compliance with the above superannuation splitting order, the parties do all things and jointly meet all costs necessary to wind up [G] Pty Ltd and the [G] Family Trust.
(l)Each party do all things and sign all documents necessary to give effect to these orders and in the event either party fails to do so, a Registrar of the Federal Magistrates Court at Adelaide is appointed and empowered pursuant to s.106A of the Family Law Act 1975 to execute all documents and perform all acts necessary to implement the terms of these orders.
Pursuant to s.117 of the Child Support (Assessment) Act 1999 and upon the Court being satisfied that there are circumstances existing to depart from the administrative assessment of child support insofar as it relates to the children [X] born [in] 2000, [Y] born [in] 2002 and [Z] born [in] 2006:
(a)the current assessment is varied such that for the remainder of the current Child Support period the husband pay Child Support to the wife at the rate of $75 per child per week; and
(b)all future Child Support assessments are varied to provide that the husband pay Child Support to the wife at the rate of $75 per child per week, indexed in accordance with the Consumer Price Index (Adelaide All Groups) on each anniversary of the date of this order;
The husband do forthwith pay all arrears of child support assessed as owing to the wife as advised by the Child Support Agency, to be deducted from the husband’s settlement monies due and payable pursuant to paragraph (2) of these orders.
All proceedings with respect to property settlement, spousal maintenance and child support are dismissed as finalised.
IT IS NOTED that publication of this judgment under the pseudonym Gilbert & Gilbert is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT ADELAIDE |
ADC 1267 of 2009
| MR GILBERT |
Applicant
And
| MS GILBERT |
Respondent
REASONS FOR JUDGMENT
Ms and Mr Gilbert separated in January 2009 after a relationship of approximately 13 years. They have agreed upon the parenting arrangements for their children [X], [Y] and [Z] but have been unable to resolve financial issues between them with respect to property settlement, spousal maintenance and child support. It now falls to the Court to determine these matters.
Background
The husband is 39 years old and the wife is 41 years old. They began living together in 1996, in London. They returned to Adelaide in January 1997 and were married [in] 1998. They then moved to live in Sydney where their daughter [X] was born in 2000. Subsequently the family lived in Melbourne for three years where their second child [Y] was born in 2002.
The parties returned to Adelaide in 2004 when they purchased the former matrimonial home at Property P in the wife’s sole name. Their third child [Z] was born in 2006.
Shortly after returning to Adelaide the husband commenced employment as a [omitted] with [P] (“[P]”). The parties established the [G] Family Trust, together with [G] Pty Ltd. The parties subsequently purchased a one‑quarter share of [P] through the [G] Family Trust, for the sum of $200,000. They also established the [G] Superannuation Fund. [G] Pty Ltd is the corporate Trustee of the Superannuation Fund.
The wife is a qualified [omitted] and has worked as a [omitted] in the past. She worked during the marriage prior to [X]’s birth in 2000 and thereafter devoted her efforts to caring for the children. The wife was effectively out of the paid workforce for the remainder of the marriage.
Following separation in January 2009, the wife worked on a casual basis as a [omitted] and eventually obtained part time employment with [omitted] in November 2009. The wife gave evidence in August 2010 that she was presently working two days per week and expected to be offered a further day in the near future. She anticipated commencing full time employment in July 2011, once [Z] is enrolled in school. At that time she estimates her salary will be in the range of $42-45,000 per annum.[1]
[1] Exhibit W1, Letter from wife’s employer [omitted], 3 August 2010
The husband continued working as a [omitted] with [P] until late 2010, when the parties sold their interest in [P] to the three remaining shareholders. The Contract for Sale provided that the husband would retain a portion of his client list and the parties would otherwise receive the sum of $220,000 for their one quarter interest in [P]. The husband has taken those clients with him to his new financial consulting company, [I].
The parties’ separation was marked by a high degree of acrimony. The wife commenced proceedings in April 2009 seeking orders with respect to parenting issues, property settlement and spousal maintenance. Despite their intense interpersonal conflict, the parties were able to agree upon interim parenting arrangements in May 2009.
Interim financial issues were not resolved as easily. Immediately following their separation the husband met the wife’s household expenses and paid her the sum of $500 per week. However the husband soon ceased this arrangement, arguing it was unaffordable. On 2 June 2009 the Court ordered the husband pay to the wife interim spousal maintenance in the sum of $400 per week, together with various other payments, including the mortgage and car repayments.
The former matrimonial home was sold in September 2009 and the net proceeds of sale were deposited into the wife’s solicitor’s trust account. In November 2009 the parties’ competing applications were listed for trial in April 2010. Shortly thereafter Mr Gilbert filed an interim application seeking to discharge the existing spousal maintenance order. That application was resolved on the basis that the wife was at liberty to draw down a similar sum each week from the net proceeds held in her solicitor’s trust account, together with the monthly repayments due on her [F] motor vehicle. The attribution of those funds, as spousal maintenance or partial property settlement, would then be determined at trial.
A family assessment report was prepared by Ms H in March 2010. Following receipt of that report, the parties entered into negotiations with respect to parenting matters and ultimately agreed that the three children would live equally with each parent. Final parenting orders were made by consent on 20 April 2010.
Unfortunately the trial regarding financial matters was unable to proceed, as the parties had not yet obtained a valuation of their interest in [P]. The remaining applications were adjourned for final hearing to August 2010.
The parties’ interpersonal relationship remains fraught, despite their co-parenting responsibilities. There is little trust or communication between them. This was particularly evident during late 2010 when the parties were negotiating the sale of their interest in [P]. It was clearly in the parties’ interests to agree about the sale of their one quarter share in [P] as quickly as possible, if only to quantify the value of this asset for the purposes of these proceedings. Despite their mutual interests being aligned, it took the parties over three months to reach an agreed position between themselves that could then be translated into a Contract for Sale and Purchase with the remaining shareholders in [P].
A further example of their inability to communicate effectively arose around [Z]’s school enrolment. Clearly it was in [Z]’s best interests that his parents agree about which school he should attend, but the parties were unable to reach any agreement, ultimately handing this responsibility over to the Court.
Sadly, these proceedings seem to have become a venue where the parties’ lack of trust and mutual respect has been played out extensively, at considerable cost to each of them, both financially and emotionally.
The trial
The trial commenced before me on 5 August 2010. It was unable to conclude on the two days allocated for hearing and was adjourned part heard to 14 October 2010. On that date the possibility of the remaining partners offering to purchase the parties’ interest in [P] was first raised. The hearing proceeded nonetheless and further evidence was adduced from the parties, before the proceedings were again adjourned, to clarify the position with respect to the parties’ interest in [P].
The parties’ evidence concluded on 27 November 2010, but the situation regarding [P] was still unresolved. The proceedings were further adjourned until March 2011, when the parties confirmed the sale of their interest in [P] was proceeding. They then filed a Statement of Agreed Facts on that issue and informed the Court that no further evidence was required. The parties were ordered to file written submissions on 8 April and 20 April respectively and judgment was reserved.
The wife relied upon the following documents:
a)Amended Application filed 2 August 2010;
b)Trial Affidavit filed 30 March 2010;
c)Financial Statement filed 30 March 2010;
d)Three reports from Dr H dated 20 May 2009, 2 September 2009 and 22 February 2010[2].
[2] Exhibit W6
The husband relied upon the following documents:
a)Trial Affidavit filed 9 April 2010;
b)Financial Statement filed 14 May 2009;
c)Affidavit of Mr C filed 22 July 2010;
d)Financial Statement filed 10 June 2010;
e)Application in a Case and supporting Affidavit filed 24 November 2009.
The parties called Mr C, who gave extensive evidence regarding the value of their interest in [P]. Ultimately that issue was resolved with the sale of the parties’ interest, as recorded in the Statement of Agreed Facts filed on 4 March 2011. The wife called Dr H, her general practitioner, who gave evidence and was cross examined.
Both parties gave evidence and were cross examined. I am satisfied Mr Gilbert and Ms Gilbert endeavoured to give their evidence honestly but, as is so often the case in proceedings before this Court, both parties tended to interpret past events in a way designed to support their own case, or undermine the other party’s position.
This was particularly obvious during the husband’s evidence about his financial arrangements. Mr Gilbert’s evidence was singularly unhelpful, at times. He eventually made various concessions in cross examination, but only when presented with the bank records which challenged, and at times refuted, his original evidence.
The husband’s conduct during the interim hearing on 2 June 2009 was also concerning. On that occasion the Court heard argument regarding the wife’s application for interim spousal maintenance. In the course of determining that application, the Court recorded a notation, inter alia, that “the husband does not intend changing the present financial arrangements regarding the disposition of his salary into the [C] accounts”. This notation was based on submissions by Counsel for the husband, relying upon the most recent sworn evidence set out in
Mr Gilbert’s Affidavit and Financial Statement sworn 14 May 2009.
Everyone in the Courtroom on 2 June 2009 believed the husband’s income was still being paid into the [C] account, everyone that is, except Mr Gilbert. The husband had established a new bank account with [S] and as early as 19 May 2009 had arranged for his salary to be paid into this account and not into the [C] account. The only person aware of this change was the husband, who failed to disclose this to the Court. This behaviour, and Mr Gilbert’s subsequent evidence about these events did little to inspire confidence in the reliability of his evidence during the trial.
I will address the parties’ competing applications for property settlement before ruling on the wife’s further applications for spousal maintenance and Child Support departure orders.
Relevant legal principles
Section 79 of the Family Law Act 1975 sets out the factors that the Court must consider when deciding an application for property settlement. Various Full Court authorities have confirmed that the Court must follow a number of discrete steps when determining any adjustment of matrimonial property[3].
[3] Lee Steere & Lee Steere (1985) FLC 9-626
First the Court must identify the assets and liabilities arising from the parties’ marriage. Both parties argue that various funds access by the other party since separation should be added back into the asset pool as “notional property” held by that party. The husband argues that he did not have the capacity to meet any order for spousal maintenance and in that regard the spousal maintenance payments accessed by the wife since November 2009 should be treated as a premature distribution of the matrimonial assets and added back into the asset pool.
The wife argues that the husband has withdrawn funds from the parties’ cheque account and, more significantly, from their mortgage account to meet various outgoings at a time when he could meet his reasonable expenses from his own income. She argues these withdrawals should be treated as a premature distribution of matrimonial assets to the husband’s benefit and should also be added back into the matrimonial asset pool. Further, she argues that the husband has retained the sole benefit of the net proceeds of sale from the parties’ share portfolio and various [P] dividends which were paid to the husband after separation.
The law does not require that funds and assets held at separation must be preserved pending a final property settlement. In NHC & RCH[4] the Full Court quoted favourably from a previous decision, M & M[5], where an earlier Full Court said:
“There seems to be no appropriate basis for notionally adding back moneys that existed at separation but which have been subsequently spent on meeting reasonably incurred necessary living expenses. Neither the Family Law Act nor the case law require that parties go into a state of suspended economic animation once their marriage breaks down pending the resolution of the financial arrangements. Parties are entitled to continue to provide for their own support.”
[4] NHC & RCH (2004) FLC93-204
[5] M & M [1998] FamCA 42
The Court then referred to C & C[6] in which a differently constituted Full Court expressed a similar view, saying:
“Whilst not seeking to place a fetter upon the exercise of discretion of a trial Judge in individual cases, it seems to us that the concept of adding moneys reasonably disposed of back into the pool ought to be the exception rather than the rule. The parties are entitled to reasonably conduct their affairs post-separation in a manner that is consistent with properly getting on with their lives.”
[6] C & C [1998] FamCA 143
Equally, the case law has identified a number of areas where it is appropriate to add back into the asset pool as “notional property” assets that are no longer available to the parties. Those areas include where assets held at separation have been used to pay one party’s legal fees[7], where assets have been disposed of wantonly or recklessly, or where one party has had the benefit of “a premature distribution of a proportion of the matrimonial assets”[8]. The latter two areas may require the Court to consider whether the funds or assets expended were “reasonably disposed of” or directed to what could be described as “reasonably incurred necessary living expenses”, or not.
[7] D J M & J L M (1998) FLC 92-816; NHC & RCH (supra)
[8] Townsend & Townsend (1995) FLC 92-569
Once the asset pool has been identified, the Court must then assess each party’s contribution during the marriage. The relevant factors pursuant to s.79(4)(a)-(c) include the parties’ direct and indirect financial contributions, any other contribution the parties may have made to the “acquisition, conservation or improvement of the matrimonial assets” and their respective contribution to the overall welfare of the family as a whole – what is often described as the “homemaker or parent contribution”.
The third step requires the Court to consider a range of factors set out in s.79(4)(d)-(g) including the matters set out in s.75(2) and the parties’ future needs. Finally the Court must be satisfied that the orders to be made are just and equitable as between the parties in accordance with s.79(2). As was noted by the Full Court in D & D[9]:
“… the task of the court in proceedings under s.79 is not akin to an accounting exercise. The task is to examine the facts of each case carefully to decide what is appropriate and just and equitable in the circumstances. There cannot be expected to be a universal answer to that question on any given set of facts. It is of the essence of judicial discretion that different minds may comfortably arrive at different conclusions.”
[9] D & D (2003) FamCA 473 at 49
I will set out my findings regarding the first three steps and then consider the overall justice and equity of the proposed outcome. In order to assess each party’s claim for add backs, it is useful to provide some background to the parties’ financial arrangements.
Post separation financial arrangements
A great deal of evidence was received regarding the financial arrangements that were in place following the parties’ separation. These issues are relevant as each party is claiming that various payments or benefits received by the other party should be added back into the asset pool available for distribution between the parties, including the interim ‘spousal maintenance’ payments received by the wife and various repayments or cash withdrawals accessed by the husband.
The wife provided a detailed analysis of the parties’ bank accounts.[10] Counsel then presented various Aide Memoires[11] drawn from her analysis of these bank statements and relied upon this material in her closing submissions.
[10] Collated bank account/mortgage./credit card/ statements tendered ‘W9’
[11] Aide Memoires 1- 6, MFI ‘W15’-‘W20’
I am satisfied that the husband was in control of the parties’ financial arrangements, both prior to and following separation. I am further satisfied that he withdrew the wife’s access to the parties’ joint accounts at separation. This left the wife in a very difficult financial situation, albeit fixed expenses such as mortgage repayments, rates and her car repayments continued to be paid.
The husband argues, and has always argued, that the parties were effectively living on credit prior to their separation, a situation which could not be maintained in the long term. This pessimistic view of the parties’ finances seems at odds with the husband’s decision to lease a [B] motor vehicle shortly prior to separation, incurring a further repayment of $1,500 per month.[12] That decision suggests that the husband felt a level of confidence in the parties’ financial security during the marriage, notwithstanding their outgoings apparently far exceeded the income and dividend payments received by him from [P].
[12] Husband’s Affidavit sworn 14 May 2009, para. 20.7.7
The household income was derived from the husband’s employment with [P]. He received a salary of $800 per week and a [P] dividend payment of $650 per week. Both payments were deposited into the parties’ joint [C] cheque account, [omitted][13]. Prior to separation they generally met their day to day household and living expenses via withdrawals from their [C] Mortgage Power account, no [omitted][14] and from the [C] Visacard account.[15] Repayments into the Visacard account were apparently drawn from the [C] Mortgage Power account, or from the cheque account.
[13] [C] cheque account in parties joint names. Statements commencing Jan 2009 at Tab 5, W9
[14] [C] Mortgage Power account in wife’s sole name. Statements at Tab 2, W9
[15] [C] Platinum card Visa account in husband’s sole name. Statements at Tab 6, W9. See Aide Memoire #4. I note the Aide Memoire lists a payment from an unknown source of $20,000 on 3 May 2010, but that payment appears to have been drawn from the husband’s [S] account by a cheque withdrawal on the same date.
I note that the parties made a lump sum payment towards their [C] Mortgage Power statement account no. [omitted] in the sum of $35,535 on 27 October 2008, approximately three months prior to separation. I have no way of knowing the source of that lump sum payment. For example, it could have arisen from the sale of shares or represented a distribution of dividends from [P]. Whatever the source, the funds were available to the parties and drawn upon to meet their living expenses leading up to separation.
Little evidence was heard regarding the pattern of lump sum or dividend payments that the parties received from [P] prior to, or following separation. It may be that the husband’s sense of financial security was based upon a regular pattern of lump sum dividend payments received from [P], in addition to the weekly wages and dividend received by him. Certainly at least one dividend payment was received by the husband on 22 December 2009.[16] It seems likely that other such payments were also received.
[16] $6,000 paid into Ms W’s [N] account – described as [P] dividend
Following separation in January 2009, the Visacard repayments continued to be drawn from the Mortgage Power account and the Cheque account, until December 2010. Across that same period substantial repayments were also made from unknown sources on various occasions.[17] These unattributed payments exceed $40,000 across this two year period.
[17] Aide Memoire No 4, MFI W17 lists repayment of $2,000 on 16 February 2009, $5,000 on 27 April 2009, 2 x $10,000 on 8/2/2010, amongst others.
The husband received further payments from [P] in the sum of $2,500 on 5 May 2010 and $6,500 on 28 July 2010. Mr Gilbert claims these payments were ‘director’s loans’ from [P], as were the two $10,000 repayments made into the Visacard account in February 2010. No documentation has been presented by the husband to support this explanation. Clearly the husband received payments from [P] over and above his weekly wages and dividend payments, however one would expect some supporting documentation would have been presented, if these payments were indeed director or shareholder loans.
The husband also suggested that various other large Visacard repayments across 2009/2010 may have been paid by his partner
Ms W. No evidence was called from Ms W in that regard. An analysis of Ms W’s [N] account no [omitted][18] does not show any of the repayments were drawn from that account. No other financial records were presented from Ms W to support this explanation.
[18] Tab 9, W9 Statements available for Nov 2009-Sept 2010
Taken as a whole, these unexplained large repayments suggest that the husband may well have had other resources or income streams available to him that have not been fully disclosed to the Court. This is significant, not only in assessing the husband’s credit in the witness box, but in assessing his capacity to meet his own financial needs from his own resources and further, his capacity to contribute towards the wife’s support by way of interim spousal maintenance.
Should the wife’s interim spousal maintenance payments be added back into the asset pool as payments received by way of interim property settlement, rather than spousal maintenance?
An interim order for spousal maintenance was made by the Court on 2 June 2009, following argument on the papers. At the time this order was made the husband claimed that he was meeting the pre-separation expenses such as mortgage repayments, lease repayments, insurances, credit cards repayments and other outgoings for the former matrimonial home. These payments exceeded $1,700 per week, according to the husband’s Financial Statement filed 14 May 2009.
The financial records now before the Court indicate that some of those payments were actually drawn from the Mortgage Power account, not from the husband’s earnings, which were initially paid into the [C] cheque account.
On 21 November 2009 the husband filed an application to discharge the order for interim spousal maintenance. As previously discussed, that application was resolved on a pragmatic basis – the wife would continue to receive payments of $400 per week, together with the repayments on the [F] motor vehicle, but these monies would be drawn from the proceeds of sale from the former matrimonial home held by her solicitors. Whether the payments were to be deemed spousal maintenance or treated as an interim property settlement distribution would be determined at trial.
There can be no suggestion that payments received by the wife prior to 21 November 2009 should be added back into the asset pool, given that the order for interim spousal maintenance was not challenged until that date. Whether or not the payments received by the wife after 21 November 2009 should be treated as spousal maintenance or as an interim property settlement distribution depends upon whether an ongoing order for interim spousal maintenance was appropriate.
If the Court concludes that the wife was able to support herself adequately or that the husband did not have the capacity to contribute to her support, then the funds paid to the wife cannot be treated as spousal maintenance payments. If not, I must then consider whether the funds should be added back as an interim property settlement distribution.
The wife’s eligibility for spousal maintenance
From the date of separation until April 2010, Ms Gilbert was primarily responsible for the care of the three children, the youngest of whom was just three years old. In addition, she experienced a significant reactive depression arising from the separation, which was exacerbated by the husband’s aggressive and bullying behaviour towards her.[19]
[19] Medical reports and evidence from Dr H
I am satisfied that the wife needed a period of time to rebuild her self confidence and recover from her reactive depression. These conclusions are supported by the evidence from her general practitioner, Dr H. Ms Gilbert was also entitled to prioritise her parenting responsibilities to [Z] until he commenced school.
The wife commenced regular part time employment in April 2010. She has successfully combined that part time employment with her parenting responsibilities, despite her underlying depression. The wife anticipated moving to full time employment once [Z] commenced school in July 2011. Presumably this has occurred.
The wife’s bank records indicate she was earning approximately $285 net per week through her part time employment.[20] I disregard any other income she may receive by way of an income tested pension or benefit, in accordance with s.75(3). Ms Gilbert claimed weekly personal expenditure of $262 per week, which is not excessive. She also pays rent of $270 per week, which I consider should be included as part of her personal expenditure, insofar as she has an obligation to provide suitable accommodation for herself and the children. Accordingly her weekly expenditure of $532 exceeds her weekly income by approximately $250 per week.
[20] Exhibit H3, wife’s banking records showing net salary paid in by [omitted]
On that basis the wife remained eligible for interim spousal maintenance, at least until she commenced full time employment in July 2011. However I have determined that the wife’s entitlement across the period April 2010 – July 2011 should be fixed in the sum of $250 (together with the car repayments), rather than the $400 that she has been receiving. On that basis the wife received $150 per week more than she was entitled to, across this period, totalling approximately $9,750.[21]
[21] $400 - $250 = $150 excess each week. Approximately 65 weeks at $150 per week =$9,750
The husband’s capacity to contribute to the wife’s support
The husband argues that he is not reasonably able to contribute to the wife’s support at any level. He argues his income is limited to the payments received from [P] totalling $1,450 per week, or approximately $80,000 per year, plus a modest Family Tax benefit payment of $185 per week. From this he claims fixed outgoings of approximately $1,150 per week together with associated Part N expenditure of $700 per week[22].
[22] Figures drawn from the husband’s Financial Statement filed 10 June 2010
Based on these figures, the husband’s income exceeds his expenditure. However, many of these expenses appear to be met from the Visacard account, which we now know was being paid down from unidentified sources, at least in part.[23] Further the husband has not accounted for other lump sum payments received by him, as discussed above.
[23] Visacard statements W9, tab 7
On the evidence before me, I am unable to conclude that the husband’s only available income consisted of the weekly payments he received from [P]. Given the level of his own expenditure, as indicated in the banking records, and the various unexplained lump sum payments received by the husband, I consider it is more likely than not that
Mr Gilbert had the capacity to contribute to the wife’s support between November 2009 and July 2011.
If not spousal maintenance, should the funds received by the wife since 21 November 2009 be added back into the asset pool?
It must be remembered that the wife’s actual household expenditure includes her ongoing obligation to support the children while they are in her care. Ms Gilbert estimates those expenses exceed $370 per week. When combined with her reasonable personal expenditure of $532, her claimed total household expenditure exceeds $900 per week, excluding the monthly [F] motor vehicle repayments. The wife’s claimed expenditure clearly exceeds her weekly income, even when the ‘spousal maintenance payments’ and child support payments are taken into account.[24]
[24] The evidence indicates that the wife’s total income was approximately $830 per week consisting of her salary ($285), ‘spousal maintenance’ ($400) and child support ($143)
I accept that the weekly payments of $400 have been directed towards the wife’s household expenditure each week, but I am unable to be satisfied these funds were “spent on meeting reasonably incurred necessary living expenses”, on the limited evidence available to me.[25] In the circumstances a portion of the funds received by the wife should be added back into the asset pool.
[25] per M & M [1998] FamCA 42
I have considered whether to add back in the sum of $9,750, as calculated at paragraph 56, but I conclude that it is more appropriate to allocate the net proceeds of sale still held by the wife as at April 2011 as an item in the asset pool, in the sum of $168,000.[26] This enables the Court to define the asset pool with some greater degree of precision.
[26] As identified in the wife’s closing submissions dated 22/4/2011, p. 1
Insofar as the wife has continued to receive weekly payments from these monies after April 2011, those funds are already taken into account in the value attributed to the net proceeds of sale still held in her solicitor’s trust account. Therefore the amount to be added back is fixed at $7,800, calculated in the sum of $150 per week for a period of fifty two weeks, from April 2010 until April 2011.
I decline to add back any of the [F] motor vehicle repayments into the asset pool, as any additional benefit received by the wife will be offset against certain [B] motor vehicle repayments drawn on the husband’s behalf, as discussed in paragraph 75.
Should funds accessed by the husband since separation be added back into the matrimonial asset pool?
The wife argues that the following amounts withdrawn by the husband from the parties joint accounts should be added back into the asset pool[27]:
a)the balance of the parties’ [C] cheque account at the date of separation in the sum of $6,159;
b)funds withdrawn by the husband from the cheque account since separation for his personal use totalling $21,487;
c)funds withdrawn by the husband from the [C] Mortgage account totalling $50,466.
[27] These figures are drawn from the parties’ bank statements (W9), as summarised in the wife’s closing submissions.
I see no basis to simply add back in the balance outstanding in the cheque account at separation, given that various joint expenses continued to be drawn from these funds.
Mr Gilbert was cross examined about the financial transactions recorded in these accounts and largely conceded that the analysis put to him by Counsel for the wife was accurate. I am satisfied that the husband continued to draw upon the equity in the former matrimonial home to meet his obligations across 2009, including the two car repayments, the mortgage repayments and eventually the spousal maintenance payments.
This contradicts his earlier affidavit material suggesting that he was meeting these outgoings from his salary and dividend payments. This was certainly not the case after May 2009, when we know that these payments were redirected to his new [S] account, in lieu of the [C] cheque account [omitted].
While Counsels Aide Memoires were of great assistance, the wife’s calculations should not be accepted at face value, however. First, it must be remembered that for the period January – May 2009, the husband’s salary and dividend payments were paid into the [C] cheque account, totalling approximately $30,450. Mr Gilbert must be allowed some capacity to withdraw those funds for his own personal support, in addition to the various fixed outgoings that were also being withdrawn from the cheque account and/or the mortgage redraw facility.
From June to October 2009, the husband’s income was deposited into his new [S] account.[28] Across this same period the [B] motor vehicle lease repayments continued to be paid from the [C] Power Mortgage account, totalling $5,616. Similarly, numerous spousal maintenance payments due to the wife were drawn from the mortgage account, totalling $4,000.[29]
[28] W9, tab 7
[29] Aide memoire 3, MFI W16
The various Aide Memoires presented by Counsel for the wife indicate that the husband made cash withdrawals in excess of $13,000 from the [C] cheque account between January and May 2009. He also made cash withdrawals totalling approximately $18,500 from the [C] Mortgage in the period January 2009 to October 2009. None of these cash withdrawals include the various fixed expenses the husband was “paying”, such as mortgage repayments, car repayments, insurance repayments or the [B] repayment.
This suggests the husband was allocating to himself approximately $800 cash per week across this nine month period (averaged out), in addition to the other expenses that were paid on his behalf from these accounts. The husband’s Visacard debt increased from approximately $5,000 in February 2009 to more than $20,000 in October 2009, which suggests he was meeting most of his expenses on credit, not from his weekly income. This cannot be considered a reasonable allocation for his own self support, by anyone’s calculations.
It is difficult to determine what would be a reasonable allocation to the husband’s self support, in the circumstances. Rather than endeavour to undertake a detailed microanalyis of the husband’s expenditure across this nine month period, I am inclined to take a broad brush approach to the question of which funds should, or should not, be added back into the asset pool. I am satisfied this approach will allow the Court to achieve a just and equitable outcome between the parties.
I conclude that the husband’s cash withdrawals from the [C] Mortgage account in the sum of $18,500 should be added back into the asset pool, as these withdrawals have had a direct impact upon the remaining asset pool. When the husband’s available income is taken into account, together with funds he has accessed from other sources, it is impossible to conclude that these withdrawals were necessary to meet his reasonably necessary expenditure.
I decline to add back the monies withdrawn from the parties’ cheque account, bearing in mind the husband’s income was paid into the [C] cheque account until at least May 2009. The subsequent activity in this account was limited, aside from the Morgan Stanley deposit, which is discussed elsewhere.
Regarding the [B] motor vehicle repayments, the husband ceased paying his salary into the parties’ joint cheques account in May 2009. Thereafter he should have been meeting this expense from his own funds, particularly as he claims this expense as a tax deduction in any event. However, when these withdrawals are weighed up against the car repayments drawn by the wife from the net proceeds of sale from the former matrimonial home, I conclude it is just and equitable to offset the benefit received by each party, rather than add back either sum.
Further add backs claimed by the wife
The wife argues that various other funds should also be added back into the asset pool, including the net proceeds received from the sale of the parties’ share portfolio, in the sum of $43,965. Ultimately the husband transferred the sum of $36,982 into his [S] account.
Various payments were made from those funds in September 2009 to the joint benefit of the parties, or to the benefit of the wife alone. Accordingly it would be inappropriate to add back the full amount when the husband did not receive the benefit of those funds. However, I am satisfied that the net proceeds transferred by the husband into his own account were retained by him and used for his own benefit. Those funds should be added back into the asset pool in the sum of $36,982.
I am satisfied that the additional lump sum payments paid to the husband from [P] should also be added back into the asset pool. The husband argues that at least two of these payments received from [P] were by way of ‘director’s loans’ (more properly described as ‘shareholder loans’ given that the husband was not formally a director of [P]), and should not be added back. Even if this is the case, the shareholder in [P] was [G] Pty Ltd and these benefits should have flowed to both parties, not simply to the husband.
There is no evidence to suggest that he has ever been required to repay these “shareholder loans”. They do not appear to have featured in the negotiations regarding the sale of the parties’ interest in [P] to the remaining three shareholders. In the circumstances, I will add back the sum of $15,000[30] received by the husband from [P] by way of lump sum payments since separation.
[30] See notes to Aide memoire 5, MFI W19
The wife argues the husband’s taxation refunds received for the financial years 2009 and 2010 should also be added back, but I am not satisfied this is appropriate in the circumstances. She also seeks a further adjustment on account of the taxation deductions that the husband claims from various expenditure, but I see no basis to make such an adjustment.
Accordingly, the funds to be added back and attributed to the husband are as follows:
Cash withdrawals from the [C]
mortgage account$18,500 Share proceeds retained by husband $36,982
Lump sum/dividend payments from [P]
TOTAL
$15,000
$70,482
The sum of $7,800 should be added back and attributed to the wife.
Remaining assets and liabilities
At the time the hearing commenced before me in August 2010, there was a considerable dispute between the parties regarding the value of their one-quarter share in [P], owned through their company, [G] Pty Ltd. Extensive evidence was heard from Mr C on this topic. The parties have since sold their interest in [P] to the remaining shareholders in the business and accordingly the value of this interest has now been clearly quantified.
The parties have agreed the value of the following assets, which represent the bulk of the matrimonial asset pool:
Proceeds of sale of former matrimonial home as at April 2011
$168,000
Proceeds from the sale of the parties’ interest in [P]
$260,000
Value of husband’s business derived from the remnant of his client list in [P] and now trading in the business name “[I]”
$65,000
However, a number of disputes remain unresolved, such as the [A] Family Trust, the parties’ motor vehicles and the status of the [B] investment. Certain issues were not pursued at trial, such as the value of furnishings and household contents. I accept that the wife retained the furnishings in and about the former matrimonial home, whereas the husband had to re-establish himself, however I am not in a position to rule on those issues, in the absence of any valuation evidence. I will address this further when considering the parties’ future needs.
[A] Family Trust
The [A] Family Trust was settled in 2009. No documents or financial records have been produced in relation to this Trust and the only issue appears to have arisen from Mr C’s valuation report. The husband did not address this Trust in his trial Affidavit however I accept his evidence in chief on this topic.
The husband gave evidence that his partner Ms W purchased a motor vehicle in 2010 and that she did so through the Trust, in order to obtain taxation relief. If the Trust has any value, it can only arise from this vehicle. The wife provided no real challenge to this evidence and I decline to attribute any value to the [A] Family Trust.
[B] Investment
The parties purchased the [B] investment in May 2006 for the sum of $27,858, which is repaid by monthly instalments of $661. The husband argues that [B] was always intended to be a long term investment. Until it is actually producing income (through [omitted]), the investment has no on‑sale value and its value should be offset by the associated liability.
I am satisfied the parties entered into this investment as part of a longer term financial strategy. I am not satisfied that this investment has nil value, as alleged by the husband, but equally, I cannot simply allocate its value as the original purchase price. I have no basis to make any finding about the value, if any, of this investment. In the circumstances, I will exclude the [B] Investment from the asset pool in total, either as a liability or an asset.
The parties’ motor vehicles
Both parties have the use of a motor vehicle which is subject to finance. There is no valuation evidence presented regarding either motor vehicle and both parties seem to have proceeded on the basis that they will each retain the vehicle in their possession and ultimately retain responsibility for any outstanding liability still owing on the vehicle.
The husband’s final submissions sought to include the motor vehicles as net liabilities with each party to retain responsibility for any debt outstanding. The parties’ most recent Financial Statements indicate that approximately $25,000 remained outstanding on the [F] motor vehicle and approximately $80,000 on the husband’s [B] motor vehicle, however I note the husband’s closing submissions indicate that this debt has decreased to $36,000.
In my view it would be inequitable to include these debts without attributing a value to the vehicles themselves. In the absence of any evidence in this regard I will simply order that each party retain their motor vehicle and assume responsibility for the debt attached. I will not otherwise include these items within the list of matrimonial assets and liabilities.
Superannuation
The parties’ superannuation interests are held within their private superannuation fund, [G] Superannuation Fund. Their respective entitlements are relatively modest in value and in the circumstances I am satisfied to include the superannuation entitlements within the one asset pool, together with the tangible assets.
Asset pool as at trial
Accordingly the asset pool available for distribution at trial is as follows:
Tangible Assets Net proceeds remaining from the sale of former matrimonial home (as at April 2011)
$123,042 Net proceeds from sale of parties’ interest in [P]
$260,000 Husband’s business ([I]) derived from the parties’ share in [P] $65,000 TOTAL
Addbacks retained by husband
$448,042
Cash withdrawals from the [C] mortgage account
$18,500 Share proceeds retained by husband $36,982
Lump sum/dividend payments from [P]
TOTAL
Addbacks retained by wife
$15,000
$70,482 Portion of monies withdrawn from net proceeds of sale of former matrimonial hole
Superannuation interests
$7,800 $7,800 Wife’s interest in [G] Superannuation Fund $29,000
Husband’s interest in [G] Superannuation Fund
Total Net Asset Pool
$58,000
$87,000
$613,324
Contributions
The parties lived together for 13 years and were married for 11 years. Neither party brought any assets of significant value into the marriage.
Both parties made a significant financial contribution in the early years of their marriage through their paid employment. The husband continued in the role of primary bread winner during the marriage whereas the wife ceased paid employment when [X] was born. Thereafter the wife directed her energy to the role of parent and homemaker, together with some brief periods of part time employment.
I am satisfied both parties devoted all of their efforts to the family during their marriage, whether by way of paid employment or non financial contributions. I conclude the parties’ contributions should be assessed as equal during the marriage.
I take a similar approach to the period since the parties’ separation in January 2009. The wife continued in her role as primary caregiver until the consent orders in April 2010, when the parties implemented a shared care arrangement. The husband continued earning an income through his employment as a [omitted] with [P] until late 2010.
While the wife has not made a direct financial contribution in the period following separation, I am satisfied that she made a substantially greater parenting contribution, at least until the consent orders in April 2010. Once the parties implemented a shared care arrangement, she recommenced part time employment, to the extent that she was able to do so.
The husband has continued in paid employment since separation but the parties have also liquidated the bulk of their assets. It is not a situation where his ongoing earning capacity added to the asset pool available for division between the parties. On the contrary, the opposite seems to have occurred, as reflected in my decision to add back various funds received, withdrawn or retained by the husband.
The Court should be cautious not to “double dip” in considering the impact of the husband’s financial arrangements. While the wife is rightly critical of the husband’s post-separation financial dealings, I have addressed these matters in determining the asset pool and adding back various sums. In the circumstances, I decline to make any further adjustment with respect to the parties’ post separation contributions and conclude that the parties’ contributions should be assessed as equal.
Section 75(2) factors
The husband is 39 years of age and the wife is 41 years of age. Now that the wife’s emotional health has stabilised, both parties are in good health.
Both parties are able to participate fully in the workforce and are now employed on a full time basis. The wife’s income is in the region of $45,000 per annum.[31] The husband has previously earned income in excess of $80,000 per annum, and very likely much more.
[31] W1 Letter from [omitted] dated 2 August 2010
It is difficult to ascertain Mr Gilbert’s current income as he is in the process of re‑establishing his own business as a [omitted] but I am confident that he will continue to earn an income at similar levels, if not higher. I conclude his income earning capacity will continue to exceed that of the wife.
The parties share the care of the children equally and both contribute to the children’s financial support. Mr Gilbert has an ongoing child support liability to the wife on account of his greater income. His child support payments were in arrears at the time of trial. There are likely to be ongoing issues regarding future child support assessments as the husband’s taxable income does not necessarily reflect his actual available income. I will address this issue further when considering the wife’s application for a child support departure order.
The husband is living with his partner, Ms W. They began living together in December 2009. Ms W purchased a property at [omitted] in December 2009. Both Ms W and the husband deposit their income into Ms W’s line of credit secured against the property. To the extent that Ms W’s equity in that property may have increased since it was purchased, the husband has an equitable interest in that increase. I am not able to quantify the extent of that financial resource but I take it into account, to a limited extent.
The husband argues that the wife is in an ongoing de facto relationship with Mr F but I reject this submission. While the wife may enjoy a relationship with Mr F there is no evidence to suggest that they are living together. Ms Gilbert may well live together with a partner in the future, but I cannot speculate about that eventuality.
The wife is living in accommodation provided by her mother but pays a commercial rent. The wife has retained the furniture in and about the former matrimonial home, which is a considerable benefit to her, albeit I have not been able to allocate a value to those items.
Both parties will retain the property and financial resources allocated to them following this judgment. The husband will retain his interest in his [omitted] business, [I]. The business is still in its infancy, but the husband brought over existing clients from [P] and should be able to build on that foundation. The business has been allocated a modest value, however it should enable Mr Gilbert to earn a comfortable income into the future.
On balance, I conclude that an adjustment in the wife’s favour of 10% on account of s.75(2) factors is appropriate.
Conclusions regarding property settlement
Based on the above conclusions, the wife will retain 60% of the net asset pool, or assets and superannuation to the value of $367,994. The husband will retain 40% of the net asset pool, or assets and superannuation to the value of $245,330. Taking into account the assets that each party will retain, or has already received, the following calculations apply:
As to the husband
Net Asset pool
$613,324
Husband to retain 40% of the net asset pool
$245,330
Assets already retained by the husband:
Husband’s business [I]
$65,000
Addbacks:
Cash withdrawals from the [C] mortgage account
$18,500
Share proceeds retained by husband
$36,982
Lump sum / dividend payments from [P]
$15,000
$70,482
Husband’s superannuation
Assets held/received by husband
$58,000
$193,482
Further cash adjustment due
Assets retained by husband
(including funds already received and added back into asset pool)
$51,848
$245,330
As to the wife
Net Asset pool
$613,324
Wife to retain 60% of the net asset pool
$367,994
Assets already received by, or available for distribution to the wife:
Add backs
$7,800
Net proceeds remaining from the sale of the former matrimonial home
E$123,042
Net proceeds of sale from the parties’ interest in [P]
Wife’s superannuation
$260,000
$29,000
$419,842
Less adjustment due to the husband
($51,848)
Assets retained by the wife
(including funds already received and added back into the asset pool
$367,994
At this point, the Court must step back and consider the overall justice and equity of this outcome. On the present calculations, the bulk of the “assets” attributed to the husband are in fact funds already retained and utilised by him. He will receive a further modest cash settlement of $51,848, together with his business and his superannuation. By contrast, the wife will receive a significant cash settlement of approximately $360,000.
This clearly places the parties in a very different position, going forward. However, it must be remembered that this outcome has arisen because of the husband’s own actions. Over the eighteen months following separation in January 2009, he utilised the parties’ funds and credit facilities for his own benefit such that the available asset pool is significantly smaller than would otherwise be the case. I take this into account in concluding that the percentage adjustment between the parties is just and equitable, on a preliminary basis.
Even though the above calculations are based on one asset pool, the Court must nonetheless consider whether a superannuation splitting order is required to achieve a truly just and equitable outcome. The husband argues that any division of the assets should include a splitting order in the wife’s favour.
On the calculations set out above, the wife is retaining approximately 33% of the parties’ superannuation interests. The husband proposes that the wife retain 60% of the total superannuation, to the value of $52,200. This would require a splitting order in the wife’s favour of $23,200 and would lead to an increase in the cash settlement available to the husband by an equivalent amount. However, any increase in the husband’s cash settlement means a reduction in the cash settlement retained by the wife.
When considering the overall justice and equity of these outcomes, I take into account the parties’ respective income earning capacity and current housing situation. The husband has stable accommodation with his partner Ms W. The wife is presently in rental accommodation and no doubt hopes to re-enter the property market. Her income is modest and her capacity to re-finance may be limited. She will be retaining a much larger lump sum settlement figure, which will greatly assist her in purchasing a new home.
Equally, her modest income means that she has a limited capacity to provide for her long term retirement needs. On balance, I conclude that a more appropriate outcome would be for the parties’ superannuation entitlements to be divided equally between them with a splitting order in the wife’s favour in the sum of $14,500.
This would result in the husband receiving a larger cash settlement in the sum of $66,348, while still receiving 40% of the total asset pool overall. The wife will retain approximately $290,000 or approximately 65% of the tangible asset pool. I am satisfied this outcome is just and equitable overall.
Spousal maintenance
The wife sought spousal maintenance payments until July 2011, which date has now passed. Assuming the wife commenced full time employment in July 2011, she is no longer eligible for spousal maintenance. Any benefits received by her, whether by way of $400 per week payment or car loan repayments should have ceased at that time. If that has not occurred the further amount received by her is already factored into the property settlement, given that the net proceeds of sale have been allocated a value as at April 2011.
Child Support
The wife seeks a departure order pursuant to s.117 of the Child Support (Assessment) Act 1989. The relevant authorities make it clear that there is a three step approach in considering whether to exercise the Court’s discretion pursuant to s.117.[32]
[32] Gyselman & Gyselman (1992) FLC92-289
First, the Court must be satisfied that one of the grounds in s.117(2) exists, to justify departing from the Child Support assessment. Second, if such grounds are established, the Court must consider whether any proposed order is just and equitable pursuant to s.117(4), taking into account each parent’s responsibility to maintain the children and the overall financial circumstances of the parties and the children. Finally, the Court must be satisfied that it is otherwise proper to make the departure order taking into account the matters set out in s.117(5).
The relevant grounds for departure set out in s.117(2) are as follows:
(b) that in the special circumstances of the case, the costs of maintaining the child are significantly affected:
[(i), (ia) and (ib) not relevant]
(ii) because the child is being cared for, educated or trained in the manner that was expected by his or her parents;
(c) that, in the special circumstances of the case, an application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child:
(i) because of the income, earning capacity, property and financial resources of the child; or
(ia) because of the income, property and financial resources of either parent; or
(ib) because of the earning capacity of either parent; or
ii)because of any payments, and any transfer or settlement of property, made or to be made (whether under this Act, the Family Law Act 1975 or otherwise) by the liable parent to the child, to the carer entitled to child support or to any other person for the benefit of the child;
[(iii) & (iv) not relevant]
The wife is seeking an order that the husband pay Child Support fixed in the sum of $75 per week per child, indexed annually. She argues that a Child Support assessment based on the husband’s taxable income will dramatically underestimate the husband’s financial capacity to contribute to the children’s support.
Given his taxable income for the 2009/2010 financial year was assessed at only $43,162, I conclude the wife’s concerns are well founded. The husband acknowledged that he is able to earn a significantly greater income but enjoys the benefits of various legitimate taxation deductions, leading to the lower assessed income.
I am hampered in my capacity to determine this issue as there is very little evidence about the parties’ current financial circumstances. However, I conclude that the following findings can safely be made on the evidence before me:
a)The wife’s annual income is in the vicinity of $45,000;
b)The husband’s current annual income is unknown, given he has only recently commenced trading on his own behalf. However, the husband is proposing that the children attend private schools commencing in 2012, incurring annual fees in excess of $22,000. He is prepared to meet those fees himself, provided this contribution is offset against any other Child Support obligation. The husband is therefore confident that he has sufficient income or financial resources available to him to meet those fees on an ongoing basis;
c)School fees of $22,000 per annum equate to a weekly child support capacity in excess of $400, substantially greater than the Child Support departure order sought by the wife;
d)The husband is able to meet the Child Support order sought by the wife.
I am satisfied that the wife has established grounds for departure pursuant to s.117(2)(c) and that the husband has the income earning capacity and resources to meet the wife’s proposed departure order.
I am satisfied that the special circumstances of this case indicate such an order is just and equitable pursuant to s.117(4), taking into account my findings elsewhere in these reasons regarding the parties’ relevant financial resources and future income earning capacity. I am satisfied the order is otherwise proper.
In reaching this conclusion, I note that if the most recent sworn evidence regarding the parties’ income and current shared parenting arrangements were applied under the current Child Support formula, the husband’s weekly commitment would likely exceed $75.00 per child per week in any event.[33]
[33] Based on 3 children under 12, half time care (ie 182 nights with each parent). Payer’s income approximately $85,000 (as per husband’s Financial Statement) and Payee’s income approximately $45,000 (as per wife’s evidence)
I am not satisfied that the child support order proposed by the husband is appropriate or that he has established the necessary grounds for departure pursuant to s.117(2). While the parties may have hoped to educate their children at private schools, the wife has made it clear on numerous occasions since separation that her consent to private education was dependent upon their overall capacity to afford the associated school fees, in addition to providing for the children’s general needs.
The evidence before me raises a considerable doubt about the parties’ capacity to privately educate their children. It is not for one parent or the other to insist that their child support obligation should be attributed to school fees, rather than the children’s ongoing support. If the husband wishes to pursue private schooling for the children then those costs should be met in addition to his primary obligation to assist with the children’s general support.
Is this outcome just and equitable overall?
I take into account the wife will be retaining cash assets of approximately $290,000 together with 50% of the parties’ superannuation entitlements, to the value of approximately $43,500. The husband will be retaining cash assets of approximately $66,000 together with his business and equivalent superannuation.
I am satisfied the orders I now make are just and equitable. While the husband’s cash settlement is significantly lower than that received by the wife, he has had the benefit of the various funds now added back into the asset pool. These are funds that would otherwise have been available to distribute between the parties, had the husband not appropriated those funds for his own use over the intervening years since separation.
Both parties are directors of [G] Pty Ltd, the Trustee of the [G] Superannuation Fund. To that extent I am satisfied that publication of this judgment affords each party procedural fairness in their capacity as directors of the corporate Trustee [G] Pty Ltd and there is no requirement for orders to be formally served on either party. Once the superannuation split is effected, it would seem appropriate that the company [G] Pty Ltd be wound up.
The husband will retain the [B] investment, together with the associated liability. He was responsible for establishing the investment and appears to have an ongoing relationship with the entity, given he was able to negotiate some leeway regarding repayment schedules. Allocating this investment to one party further disentangles the parties’ finances.
The Child Support departure order provides certainty to the parties as the husband’s future child support obligations are clearly defined. This should avoid further disputes and conflict between the parties in the years to come.
I am satisfied this outcome is just and equitable in all of the circumstances. I now make orders as published at the commencement of these Reasons.
I certify that the preceding one hundred and thirty-six (136) paragraphs are a true copy of the reasons for judgment of Kelly FM
Date: 21 September 2011
Hickey & Hickey (2003) FLC 93-143
AJO v GRO (2005) FLC 93-218
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