Gillim and Gillim & Ors (No 2)

FAMILY COURT OF AUSTRALIA

GILLIM & GILLIM AND ORS (NO 2)

[2014] FamCA 701

FAMILY LAW – PROPERTY SETTLEMENT IN RELATION TO MARRIAGE – PRESUMPTION OF ADVANCEMENT – DOCTRINE OF RESULTING TRUST – where there is a dispute regarding the beneficial ownership of particular properties – consideration of the presumption of advancement and when this may be rebutted – consideration of the circumstances in which a resulting trust arises

FAMILY LAW – PROPERTY SETTLEMENT IN RELATION TO MARRIAGE – DEFENCE OF LACHES –where the respondents allege that the husband has significantly delayed bringing his claim – where the husband brought claim within the limitation period in the Family Law Act1975 (Cth) – where the husband has not caused another to alter their position or incur expense – where the defence of laches is not made out

FAMILY LAW – PROPERTY SETTLEMENT IN RELATION TO MARRIAGE – ASSESSMENT OF CONTRIBUTIONS – where the parties have been married for almost 50 years – where three are three children to the marriage – where numerous properties were bought and sold during the marriage – where there were contributions by both parties’ parents – where the wife, and not the husband, will benefit from an estate and the parties made a contribution to the assets of the estate. – where there is a slight adjustment in favour of the husband

Family Law Act 1975 (Cth), ss 44, 75, 79 Family Law Rules 2004 (Cth) rule 17.03 Limitation Act NSW (1969) ss 14, 63
Archbold v Scully (1861) HLC 360 Calverly v Green (1984) 155 CLR 242 Hourigan v Trustees Executors and Agency Co (1934) 51 CLR 619 Markoska & Markoska [2011] FamCA 572 Ogilvie v Adams [1981] VR 1041 Stanford v Stanford (2012) 247 CLR 108 Vadisanis & Vadisanis and Anor [2014] FamCAFC 97

APPLICANT HUSBAND:

Mr D Gillim

1^ST RESPONDENT WIFE:	Ms J Gillim
2^ND RESPONDENT:	Mr N Gillim
3^RD RESPONDENT:	Ms Kemery
4^TH RESPONDENT:	Mr A Gillim

FILE NUMBER:

SYC

6124

2011

DATE DELIVERED:

29 August 2014

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Rees J

HEARING DATE:

4 and 5 August 2014

REPRESENTATION

THE APPLICANT HUSBAND:

In Person

COUNSEL FOR THE RESPONDENT WIFE:

Mr Harper

SOLICITOR FOR THE RESPONDENT WIFE:

Farrar Gesini Dunn

COUNSEL FOR THE 2^ND, 3^RD AND 4^TH RESPONDENTS:	Mr Jones
SOLICITOR FOR THE 2^ND, 3^RD AND 4^TH RESPONDENTS:	Barkus Doolan Family Lawyers

Orders

IT IS DECLARED

That the wife is beneficially entitled to 34.09 per cent of the property known as C Street in Suburb D (“D property”).

IT IS ORDERED

That the wife forthwith do all acts and things required to transfer to the husband her right, title and interest in the property known as E Street, Suburb F.
That the wife assign to the husband her interests as a beneficiary in the Mr D Gillim Family Trust and resign as a director and shareholder of Mr D Gillim Pty Limited (the trustee of the Mr D Gillim Family Trust).
That within 90 days of the making of these orders the wife pay to the husband the sum of $321,389.
That upon payment of the sum referred to in Order 4, the husband shall do all acts and things required to transfer his right, title and interest in the property at G Street, Suburb F (“the former matrimonial home”) to the wife.
That in the event that the payment referred to in Order 4 is not made by the due date, the husband and the wife shall do all acts and things required to sell the former matrimonial home and, from the proceeds of sale, to pay to the husband the sum of $321,389 together with interest from the due date until the date of payment at the rate prescribed by Rule 17.03 of the Family Law Rules 2004 (Cth) and to pay the balance to the wife.
That other than as provided in these orders, each party is solely entitled as against the other to any property in the possession of that party.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Gillim & Gillim & Ors has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 6124 of 2011

Mr D Gillim

Applicant Husband

And

Ms J Gillim

1^st Respondent Wife

And

Mr N Gillim

2^nd Respondent

And

Ms Kemery

3^rd Respondent

And

Mr A Gillim

4^th Respondent

REASONS FOR JUDGMENT

Mr D Gillim (“the husband”) married Ms J Gillim (“the wife”) in 1965. They separated on 6 November 2000 after cohabitation of almost 36 years, which produced three children, the youngest of whom is aged 43 years.
The husband at the time of the trial was aged 77 years and the wife was aged 73 years.
The husband and the wife variously bought and sold properties and engaged in business. Those transactions are relatively uncontroversial and can be detailed briefly.
Both parties submitted that, in relation to the asset pool which comprised of property acquired by the parties’ own efforts, there should be an equal distribution between them.
The three adult children of the marriage are joined as respondents (“the respondents”) to the proceedings in their capacity as executors of the estate of the wife’s late mother and trustees of the B Trust which is the testamentary trust of the estate.
The dispute between the husband, the wife and the respondents relates to the estate of the wife’s late mother. The respondents are the executors of her estate and the trustees of her testamentary trust (“the B Trust”). Transactions involving the wife’s mother and, subsequently, her estate, are more complex and the subject of a dispute that involves not only the husband and the wife but their children. It is convenient to detail those transactions separately.
In these reasons, the parties will be referred to as the husband, the wife and the respondents.

THE FINANCIAL DEALINGS OF THE HUSBAND AND THE WIFE

In 1949 when the husband was 11 years old his father died intestate. The husband inherited two thirds of his father’s estate and his mother inherited one third. The husband’s father’s estate included a farming property of 848 acres near Suburb F (“the family farm”) and a farming business was conducted upon that property. Prior to the marriage the husband entered into a partnership with his mother to carry on the farming enterprise under the name of “Gillim”.
Immediately prior to the marriage the husband purchased a home for his mother in H Street, Suburb F, for 10,000 pounds. The husband had a half interest in a business which operated in Suburb F.
At the commencement of the marriage the wife did not have any significant assets.
When the parties married the husband’s mother moved out of a home which she owned at I Street, Suburb F and allowed the husband and the wife to occupy that property rent free, from the date of the marriage.
The parties’ first child was born in 1967 and their second child in 1968.
Where property was purchased after the marriage, there is no significance in whether it was purchased in the name of either or both of the parties and the purchases and sale will be referred to as purchases or sales by the parties.
After the marriage, the parties formed the partnership of Ms J & Mr D Gillim (“the partnership”) and carried on their various business and farming enterprises through the partnership.
In 1968 the parties purchased 640 acres of farming land at J Town (“J Town”) for about $20,000.
The parties’ third child was born in 1971.
In December 1971, the husband’s mother sold the property at I Street, Suburb F and gave the sale proceeds of $18,000 to the husband and the wife who used that money to purchase a property at G Street, Suburb F (“the former matrimonial home”) for $18,250. The parties still own that property.
In 1973 J Town was sold.
In 1974 the parties purchased a property adjacent to the family farm comprising 1,100 acres of land and known as “K” for $84,700. The purchase was financed by borrowings from the State Bank.
In 1974 the husband caused to be formed the Mr D Gillim Family Trust (“the Family Trust”) and the husband and his mother transferred their respective interests in the farming partnership (but not the real estate of the family farm) to the Trust. The husband was the appointor of the Family Trust and the beneficiaries were the husband, the wife, their children and their other relatives, including their mothers.
Also in 1974 the husband, with two partners from his business, built four strata units in L Town. In the same year they purchased a commercial building in M Street Suburb F known as “N Pty Ltd”. The purchase price of both of these investments was entirely borrowed.
In 1978 part of K was sold and the money paid to reduce debt. Also in 1978 with one other partner from his business the husband purchased two investment homes in L Town. The purchases were negatively geared.
In April 1982 the wife, through the vehicle of the Family Trust, started a business in Suburb F. Until 1986 the business was run in partnership with a friend. The parties contributed funds to start the business and, from time to time, to provide capital. In 1988 the wife purchased a similar business in Suburb O and in 1990 another in Suburb P. The Suburb O and Suburb P businesses were later sold and the wife continued to run the business in Suburb F until it was eventually closed in 2009, after the separation.
In 1982 the husband sold K for $150,000 and the husband and his mother sold the family farm at Suburb F for $130,000. The husband’s mother gave the husband her share of the proceeds of sale of the farm being one third or $44,333.
Also in 1982 the husband and his partner sold the N Pty Ltd premises for $160,000.
At about the same time, the husband, using the proceeds of sale of the farming properties, purchased a block of eight home units in Suburb Q in the Australian Capital Territory for $250,000 and four strata units in L Town for $90,000. In order to finance those purchases the husband borrowed $220,000.
In March 1983 the husband’s mother died. She left her residuary estate, including the home in H Street Suburb F to the husband. He sold that property in late 1983 for $45,000.
In June 1985, the husband, then suffering from ill health, resigned from the business and received $140,000 for his interest. He entered into a restraint of trade for a period of three years.
The sum of $140,000 received by the husband was used in part to purchase five contiguous blocks of land in R Street, Suburb F (“R Street”). Two blocks were purchased in the wife’s name, one in the husband’s name and two in the name of the parties’ eldest son. The parties’ eldest son contributed $25,000 to the purchase and the balance was paid from the funds of the husband and the wife.
In the latter part of 1985 the parties purchased 250 acres of land at S Town and 900 acres of land at T Town. The total purchase price of the two properties was $315,000 and the whole of the amount was borrowed.
In 1986 the husband commenced work as a financial planner.
In 1987 the parties purchased 1,100 acres of land at U Town for $495,000 and that land was farmed until it was sold in 2000.
In 1987 the 900 acres of land at T Town was sold for approximately $360,000 and the proceeds used to reduce the debt incurred for the purchase of U Town.
In 1987 the parties purchased a three bedroom property at E Street, Suburb F (“E Street”) in the name of the wife for $33,000. They borrowed $30,000 to complete the purchase and carry out renovations. Initially their house was rented and the rent applied towards the mortgage.
In 1988, 100 acres of the land at U Town was sold for $90,000.
Also in 1988 the husband commenced employment again. Later in the same year, the property at E Street was converted into offices, (at the cost of the husband’s business) and the business then paid $250 per week rent to the wife and occupied the premises.
The husband continued to conduct his business and, when the parties’ eldest son graduated, he was employed by the husband. In addition the farming partnership continued and a share farmer was engaged.
In about June of 1989 the parties bought a farming property consisting of 1,430 acres in Suburb P for $550,000. The whole of the purchase price was borrowed.
In December 1993 the husband had a further serious episode of ill health and was unable to work until February 1994.
In 1996 the property at 2 E Street, Suburb F (“2 E Street”) was purchased, again in the name of the wife, for $55,000. The whole of the purchase price was borrowed. 2 E Street was rented as a residence for about three years and then converted into offices and amalgamated with E Street. The husband moved his business into the amalgamated premises in 1999 and thereafter paid rent to the wife of $450 per week.
In 1998 the parties purchased a residential property in V Street, Suburb F for $75,000 in the name of the wife (“V Street”). Approximately $15,000 was provided by the parties and the balance of about $60,000 was borrowed.
In October 1999 the husband suffered a further episode of serious ill health and was unable to work for two months.
When the husband returned to work in early 2000 various of the assets of the parties were sold:
·The eight Canberra units were sold for approximately $900,000
·The rest of the U Town property was sold for $403,000
·Suburb P was sold for $576,000
·The land at S Town was sold for $80,000
As a result of those sales and the application of the sale proceeds to reduction of debt, all of the property then owned by the parties, other than V Street, was free of debt.
On 17 May 2000 the husband transferred his business to the parties’ eldest son. For a period of time the husband received $1,250 per week and then $650 per week but no other monies have been paid to the husband as a result of that transaction.
The parties separated on 6 November 2000.
At the time of separation the parties had the following property:
(a)The former matrimonial home at G Street Suburb F which was unencumbered;
(b)Premises at 1 and 2 E Street (unencumbered);
(c)Premises in V Street Suburb F subject to a mortgage;
(d)A 32 acre residential block in R Street Suburb F;
(e)Two 10 acre residential blocks in R Street Suburb F;
(f)Two AMP policies on the husband’s life;
(g)The partnership of J and D Gillim;
(h)The Mr D Gillim Family Trust;
(i)Shares; and
(j) The husband’s superannuation of $50,000.
In addition, the husband claimed that the wife had an interest in the property at C Street in Suburb D (“D property”) of which the wife’s mother was the registered proprietor. This claim will be considered separately in these reasons.
When the parties separated, the wife was solely responsible for the management of D property. She received the rent and also took responsibility for the payment of interest on the loan of $160,000 from Advance Bank, which had been raised by the parties for the purchase of D property, and on which there had been a further advance of $60,000, leaving a liability of $220,000. The rent continued to be paid from time to time into the partnership account but nothing turns on this.

AFTER SEPARATION

The wife remained living in the former matrimonial home and continued to receive the rent from the two E Street properties.
In November 2000 the husband moved to W Town and was employed there.
At some time after separation, the husband formed a relationship (which had ended by the time of the hearing) with his former partner Ms X.
In 2001 the husband moved to Sydney and lived in rented premises and was employed there.
In 2002 he and Ms X purchased a home in Suburb Y (“Suburb Y”) for $475,000. To finance the purchase they raised $380,000 by way of mortgage and the husband used $50,000 from his superannuation together with further borrowings on his credit cards to contribute his half share of the purchase price.
In 2005 the husband commenced business in his own right in Sydney.
In 2008 the husband commenced employment in L Town.
In 2009 the husband and Ms X sold Suburb Y and each received $100,000. This money, together with a mortgage of $200,000, was applied to the purchase of a property at Suburb Z (“Suburb Z”) for $385,000.
In August 2009 the husband ceased full-time work. He then did occasional consulting work.
After the purchase of Suburb Z, the husband was not employed and he drew down on his superannuation entitlements and used his credit cards to meet his half share of joint outgoings including mortgage payments.
In March 2013 Suburb Z was sold and the husband received a share of the proceeds as set out later in these reasons.

THE PURCHASE OF UNITS BY THE WIFE AND HER MOTHER

On 7 May 1976, the wife and her mother, as tenants in common, purchased a unit in the “AA” building at BB Street, Suburb D (“AA”) for $41,000. The purchase was financed entirely by the wife’s mother who had sold an investment property in Suburb F. The wife was the only child of her parents.
The beneficial ownership of AA prior to the sale of the property in 1999 is in dispute in these proceedings.
It is the husband’s case that, by virtue of the presumption of advancement, the wife, both beneficially and legally, owned a half share of AA. The wife disputes that assertion.
The wife’s evidence in relation to the purchase of AA is set out at paragraph 11 of her affidavit sworn 9 December 2011 where she says:
I do not believe that my mother gave me one half of the proceeds of the sale of the [Suburb F] investment property. My mother looked after all of her affairs and was very astute. She managed her investments carefully and got maximum interest on her deposits. I do not recall my mother saying anything about the unit being mine “eventually”. We bought it as tenants in common in equal shares though my mother paid the entire purchase price. I do not believe that we borrowed any money for the purchase. My mother may have borrowed money in her own name to make up the small difference between the proceeds of [Suburb F] and the purchase price of [Suburb D]. If she did she paid it off herself. (The husband) and I did buy some furniture for the unit. We used the unit as a family and my mother stayed there from time to time, sometimes with us but generally on her own. I do not believe we repainted it more than once during the time that my mother and I owned it. We did not change furniture. As far as I was concerned it was my mother’s unit and as her only child she allowed me and my family to use it.
In 1991 the AA unit was sold for $342,500.
The whole of the proceeds of the sale of AA were invested in the purchase of D property.
D property, which was purchased for $472,500, was purchased in the sole name of the wife’s mother. The whole of the proceeds of sale of AA were applied to the purchase of D property. In order to fund the balance of the purchase money, the husband and the wife borrowed $160,000 from the Advance Bank (later the St George Bank “St George”), on the security of D property.
Of the $160,000 which was borrowed on the security of D property, the husband and the wife applied $130,377 towards the balance of the purchase price for D property and a further $16,000 for stamp duty, a total of about $146,000. Some of the balance of the amount which was borrowed was used to buy furniture for D property.
The husband acted as the solicitor for the purchase. It is the husband’s evidence that he had a conversation with the wife’s mother, in the presence of the wife where the husband said to the wife’s mother at various times “the unit will be in your name but you will hold it on behalf of both yourself and (the wife).” The husband says that the wife’s mother responded “whatever (the wife) wants to do is all right with me. It will be hers anyway.”
The wife had no recollection of those conversations or indeed of almost any of the detail of the transaction. However, the wife was adamant that the parties did not lend her mother any of the $160,000 which was raised by borrowing.

After the settlement of the purchase of D property, the wife’s mother agreed that the husband and the wife would manage the lettings and all rent received was paid to them. From the rental income they paid the interest on the loan of $160,000 and the outgoings on D property. If the rent was insufficient to pay the outgoings, they met the shortfall from their income.
After the purchase had been settled the wife’s mother made a will in which she left D property to the wife with the provision that if the wife predeceased her, the husband would have a life interest in D property and, on his death, it would pass to the children of the husband and the wife.
That will was changed after the parties separated and a new will was executed, leaving the estate of the wife’s mother to the B Trust of which the beneficiaries were the wife and her adult children. The wife’s adult children are the trustees of the B Trust.

THE HUSBAND’S CASE IN RELATION TO D PROPERTY

The husband asserts that the wife was a half owner of AA, by operation of the presumption of advancement. He submits that when AA was sold and the wife’s half share of the sale proceeds (representing 34.09 per cent of the purchase price of D property) was used for the purchase of D property, the wife became, by operation of resulting trust, the owner of 34.09 per cent of D property. Further, he asserts, the contribution by the husband and the wife of approximately $146,000 to the purchase of D property (representing 31.8 per cent of the purchase price) gave rise to a resulting trust in favour of the husband and the wife of an additional 15.91 per cent share each of D property. (The parties agreed that the husband’s calculations of the percentage interests were correct if his argument were accepted).
Having regard to the above, the husband’s case may be framed as an assertion that:
a)the wife beneficially owns 50 per cent of D property by virtue of her contributions of the AA net sale proceeds (34.09 per cent of the D property purchase price) and half of the joint borrowings (15.91 per cent of the D property purchase price); and;
b)the husband beneficially owns 15.91 per cent of D property by virtue of his contribution of half the joint borrowings.
Alternately, having regard to the husband’s evidence that the reason he was a party to the D property loan was because the Advance Bank would not lend money solely to the wife and the wife’s mother, and to his evidence of conversations he had with the wife’s mother where he explained that her and the wife would be the owners of D property, it appears that the husband’s asserted 15.91 per cent share in D property (outlined above) was, on his own evidence, a contribution by him on behalf of the wife. Therefore, the husband’s case would better be framed as an assertion that the wife beneficially owns 65.91 per cent of D property by virtue of her contributions of:
c)her share of the AA sale proceeds, representing 34.09 per cent of the purchase price of D property, and;
d)the borrowings from Advance Bank, representing 31.82 per cent of the purchase price of D property.
Thus, on the husband’s case, the residuary estate of the wife’s mother includes only 34.09 per cent of D property and the wife’s share of D property is an asset of the parties for the purpose of the proceedings.

THE WIFE’S CASE IN RELATION TO D PROPERTY

The wife denies that she was a beneficial owner of AA.
She denies that she is a beneficial owner of D property.
She denies that the parties lent any money to her mother for the purchase of D property but she admits that $146,000 was applied by them to the purchase.

THE LAW

As the learned authors of Jacobs Law of Trusts in Australia 7^th edition paragraph 1210 set out:
A resulting trust will be presumed where, on a purchase, the legal title to real or personal property is vested in someone other than the person who is approved (by parol or other evidence) to have provided the purchase money. Thus where A purchases land from X and directs X to make the transfer to B which X does, there is a presumption of a resulting trust in favour of A, except as will be seen later, where A is the husband or parent of, or stands in loco parentis to B. The classic authority is Dyer v Dyer in which Eyre LCB said:
The clear result of all the cases, without a single exception, is, that the trust of the legal estate, whether freehold, copyhold, or lease hold; whether taken in the names of the purchases and others jointly, or in the name of others without that of the purchaser; whether in one name or several, whether jointly or successive, results to the man who advances the purchase money. This is a general proposition supported by all the cases, and there is nothing to contradict it; and it goes on a strict analogy to the rule of the common law, that where a feoffment is made without consideration, the use results to the feoffor.
That this represents the law today in Australia was confirmed by Aickin J (with the concurrence of Stephen, Mason and Murphy JJ) in Napier v Public Trustee (WA), where his Honour said:
The law with respect to resulting trusts in not in doubt. Where property is transferred by one person into the name of another without consideration, and where a purchaser pays the vendor and directs him to transfer the property into the name of another person without consideration passing from that person, there is a presumption that the transferee holds the property upon trust for the transferor or the purchaser as the case may be. This proposition is subject to the exception that in the case of transfers to a wife or a child (including someone with respect to whom the transferor or purchaser stands in loco parentis) there is a presumption of advancement so that the beneficial as well as the legal interest will pass. Each of the presumptions may be rebutted by evidence.
The learned authors of Jacob’s Law of Trusts in Australia 7^th Edition at paragraph 1213 say:
The presumption in favour of a resulting trust in the case of a voluntary transfer of realty or a transfer to a person other than the purchaser and the presumption against a resulting trust in the case of a transfer to the wife or child of ,or person in loco filii, to the purchaser may be rebutted – that is where the presumption of a resulting trust arises, evidence is admissible to prove that no trust was intended, and where there is a presumption against a resulting trust, as in the case of a transfer to the wife or child of the purchaser, evidence will be admitted to show that the wife or child was intended to be merely the nominee of the purchaser … the law endeavours always to give effect to the intentions of the parties, but in the absence of any evidence of such intention except the bare fact of the transfer to someone other than the purchaser, it presumes, until the contrary is proved, in the first case, in favour of the person providing the purchase money and, in the other, in favour of the wife or child or person in loco filii.
In order to ascertain the true intention of the person who has paid the purchase money, the court apart from receiving testimony from that person as to that person’s intention, will admit evidence (written or parol), of the circumstances surrounding the transfer: for example, the relationship of the parties, and statements made by the parties. Evidence of acts and declarations of the parties before or at the time of the purchase or so immediately after it as to constitute a part of the transaction will be admissible either for or against the actor or declarant. But for subsequent acts and declarations this is not so. In regard to the latter, the rules of evidence relating to declarations against interest will apply. The decision of the House of Lords in Shephard v Cartwright makes it clear that in rebutting either the presumption of a resulting trust or the presumption of advancement subsequent acts are inadmissible in favour of the person doing those acts that are admissible against that person. The High Court in Calverly v Green reaffirmed this as the law in Australia.
The learned authors go on to say:
It should be emphasised that the task is to ascertain property rights at the time of acquisition or purchase of the property concerned and that the right so ascertained cannot be altered by subsequent events without an enforceable agreement or a conveyance. Hence the relevant intention is the intention at the time of the acquisition or purchase. The time of creation of a resulting trust is important, since once it is established, from the date of its establishment the beneficiary has, in equity, a proprietary interest in the trust property, enforceable against any later claimant except a bona fide purchaser for value of a legal estate without notice.
In Calverly v Green (1984) 155 CLR 242 (“Calverly v Green”) Gibbs J said:
Where a person purchases property in the name of another, or in the name of himself and another jointly, the question whether the other person, who provided none of the purchase money, acquires a beneficial interest in the property depends on the intention of the purchaser. However, in such a case, unless there is a such a relationship between the purchaser and the other person as gives rise to a presumption of advancement, i.e., a presumption that a purchaser intended to give the other a beneficial interest, it is presumed that the purchaser did not intend the other person to take beneficially. In the absence of evidence to rebut that presumption, there arises a resulting trust in favour of the purchaser.
Deane J, in Calverly v Green, in relation to the equitable presumptions of resulting trust and advancement, said:
The law embodying them has been seen in this Court to be so clear that it “can … no longer be subject of argument”: per Dixon CJ, McTiernan, Williams, Fullagar and Taylor JJ, Charles Marshall Pty Limited v Grimsley (93).
The onus lies upon the wife to rebut the presumptions.
Therefore, the legal issues for determination before me are these:
·    In circumstances where the wife’s mother provided the whole of the purchase price of AA, does a resulting trust arise in her favour such that the law would hold that the wife held the property on trust for her mother?
·    Is the presumption of resulting trust rebutted by the presumption of advancement?
·    What was the beneficial ownership of the proceeds of sale of AA used for the purchase of D property?
·    Does a resulting trust arise in favour of the wife from the use of funds of the wife to purchase D property in the name of the wife’s mother?
·    What interest arises in the wife, or the husband and the wife, from their contribution of the sum of approximately $146,000 to the purchase price of D property?

standard of proof

Murphy J in Markoska & Markoska [2011] FamCA 572, considered the standard of proof applicable in rebutting the presumption of advancement. I respectfully adopt his Honour’s reasoning, commencing at paragraph 114:
Conclusions about intention are not to be gleaned however, from suspicions or what is assumed to be true; such a conclusion must be based on the evidence to a satisfaction on the balance of probabilities.
Heydon JA held in Damberg v Damberg & Ors [2001] NSWCA 87:
[42] There is a presumption that where one or more parents convey property to a child, the parent or parents intended to give the child the beneficial interest in the property, not merely the legal title. That presumption can be rebutted by showing, on the balance of probabilities, that the parent or parents did not have that intention. In the present circumstances, where the husband alone transferred the property, it is his actual intention alone which is to be ascertained: Calverley v Green (1984) 155 CLR 242 at 246-251 per Gibbs CJ.
[43] It has been said that although the presumption is rebuttable, it does "not ... give way to slight circumstances": Shephard v Cartwright [1955] AC 431 at 445 per Viscount Simonds, quoted in Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353 at 365 by Dixon CJ, McTiernan, Williams, Fullagar and Taylor JJ. According to Viscount Simonds, the quoted words were uttered by Lord Eldon LC in Finch v Finch (1808) 15 Ves Jun 43; 33 ER 671; in fact they were not, though they appear in the headnote, though the expression "slight circumstances" was used by the losing counsel, Sir Samuel Romilly, in argument (at 48 and 673), and though Lord Eldon LC said that the "presumption is not to be frittered away by nice refinements" (at 50 and 674). There are other authorities suggesting that the standard of proof is higher than the normal civil standard. In Grey v Grey (1677) 2 Swans 594 at 598; 36 ER 742 at 743, Lord Nottingham LC said:
"the natural consideration of blood and affection is so apparently predominant, that those acts which would imply a trust in a stranger, will not do so in a son; and, ergo, the father who would check and control the appearance of nature, ought to provide for himself by some instrument, or some clear proof of a declaration of trust, and not depend upon any implication of law; for there is no necessity to give way to constructive trusts, but great justice and conscience in restraining such constructions."
(By "constructive trusts" he meant "resulting trusts".) In In Re Kerrigan; ex p Jones (1946) 47 SR (NSW) 76 at 87 the presumption was said by Davidson J to be "a strong one".
[44] However, A W Scott and W L Fratcher, The Law of Trusts (4th ed) vol V para 443 p 194-p196 said:
"It has been said in a number of cases that the presumption of a gift where property is purchased in the name of a relative can be rebutted only by evidence that is strong and clear, or as it is said in some cases by conclusive or indubitable evidence. There is no reason, however, why the payor should be required to produce evidence of this character. The better view is that it is necessary to produce such evidence as is required to establish any other fact. As the court said in one case: 'It is the intention of the parties in such cases that must control, and what that intention was may be proved by the same quantum or degree of evidence required to establish any other fact upon which a judicial tribunal is authorised to act'."
The quotation was from Hartley v Hartley 117 NE 69 at 73 (1917, SC Ill). See, to the same effect, R P Meagher and W M C Gummow (eds), Jacobs' Law of Trusts in Australia (6th ed, 1997) para 1216 p 300. Hence the standard of proof to be met in order to rebut the presumption does not call for application of the principles discussed in Briginshaw v Briginshaw (1938) 60 CLR 336, or rest on any analogy with the high standard of proof in rectification. But it does call for proof of a "definite intention" to retain beneficial title, not a "nebulous intention to rely upon the ... relationship as a source of control over the property": Drever v Drever [1936] ALR 446 at 450 per Dixon J (dissenting, but not on this point).

THE DEFENCE OF LACHES

Although the 2^nd to 4^th respondents did not plead laches as a defence they relied on the defence at trial.
The husband, in his written submissions, submits that the late reliance on the defence is unfair to him because he was denied the opportunity to put evidence before the Court of the negotiations between the parties, from a time shortly after their separation, where the issue of the wife’s interest in D property was raised. Because of the conclusion I have reached about the defence, it is not necessary to consider whether procedural fairness would demand that the matter be adjourned and the husband given opportunity to put that evidence before the Court.
In written submissions, the respondents asserted that the husband had significantly delayed in bringing his claim. The respondents assert that the claim was brought 20 years after the property (D property) was purchased, 11 years after separation and three years after the death of the wife’s mother.
The respondents relied upon the judgement of Rich J in Hourigan v Trustees Executors and Agency Co (1934) 51 CLR 619 at 630 where his Honour said:
If a party in a position to claim an equitable right which is not undisputed lies by and acts in such a way as to lead to the belief that he has no such claim, or will not set it up, and thus encourages the party in possession to so deal with his own affairs that it would be unfair to him and to others claiming under him to tear up the transactions and go back to the position which might originally have obtained, the Court of equity will not, even where the claim is that an express trust is created, disregard the election of the party not to institute his claim and treat as unimportant the length of time during which he has slept upon his rights and induced the common assumption that he does not possess any. In Blake v. Gale (1), , Bowen L.J. said:—"When we find that a long time has elapsed during which the right has never been insisted upon, and when neither the Statute of Limitations applies, nor can the analogy of the statute be invoked according to the well known way in which Courts of equity occasionally invoke it, what have we to do? We have to look at the delay which has taken place, coupled with the circumstances under which it has taken place, in order to see whether or not the true inference to be drawn from such delay under such circumstances is that the party claiming the right either agreed to abandon or release his right, or else has so acted as to induce the other parties to alter their position on the reasonable faith that he has done so. If that is the inference to be drawn, the claim will, for the purpose of quieting possession, be treated as abandoned." (See also Clarke and Chapman v. Hart(2) a case of partnership; Archbold v. Scully(3); Brooks v. Muckleston(4)Rochefoucauld v. Boustead(5); Kent v. Jackson (6) ).
In the present matter, it could not be said that the husband has acted on a way that constituted an abandoning of his claim or that, by his delay, he has induced other persons to alter their positions.
In Archbold v Scully (1861) HLC 360 at 383, Lord Wensleydale said:
I take it that where there is a Statute of Limitations the objection of simple laches does not apply until the expiration of the time allowed by the Statute. But acquiescence is a different thing: it means more than laches. If a party, who could object lies by and knowingly permits another to incur an expense in doing an act under the belief that it would not be objected to, and so a kind of permission may be said to be given to another to alter his condition, he may be said to acquiesce; but the fact of simply neglecting to enforce a claim for the period during which the law permits him to delay without losing his right, I conceive cannot be any equitable bar.
The Family Law Act 1975 (Cth) (“the Act”) imposes a limitation period in relation to applications such as the present. The claim must be brought within one year of the date upon which a Divorce Order is made. These parties are not divorced and therefore the limitation period still runs. Whilst the limitation period in itself is not necessarily conclusive to a determination that laches does not apply, nothing suggests that the husband, in not bringing his claim earlier, has led another party to incur expense or “alter his condition”.
Courts exercising jurisdiction under the Act are required to consider and determine the parties’ existing legal and equitable interests in property.
In Stanford v Stanford (2012) 247 CLR 108, the unanimous judgment of the High Court made clear the duty of the trial judge in the following manner:
First, it is necessary to begin 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. So much follows from the text of s 79(1)(a) itself, which refers to "altering the interests of the parties to the marriage in the property" (emphasis added). The question posed by s 79(2) is thus whether, having regard to those existing interests, the court is satisfied that it is just and equitable to make a property settlement order.

I do not consider that the defence of laches is made out. The wife’s equitable rights in relation to D property exist, regardless of whether the husband seeks to have them declared or not, and the Court is obliged to identify those rights.

DID THE A RESULTING TRUST ARISE ON THE PURCHASE OF AA SUCH THAT THE WIFE’S INTEREST IS HELD BENEFICIALLY FOR HER MOTHER?

The wife’s mother provided the whole of the purchase price of AA. Absent the presumption of advancement, the law requires that the wife’s interest in one half share as tenant in common in AA be held on trust for her mother unless there is evidence to rebut the presumption. The evidence of the husband and the wife is set out in the discussion dealing with the rebuttal of the presumption of advancement.
The presumption is not rebutted by the wife’s evidence that she did not know the circumstances of the transactions or that she did not know that she had acquired an equity in AA. The resulting trust comes about by operation of law as a result of the actions of the wife’s mother in purchasing the property as she did.
Absent the presumption of advancement, there is no evidence to rebut the presumption that a resulting trust arose.

IS THE PRESUMPTION OF A RESULTING TRUST REBUTTED BY THE PRESUMPTION OF ADVANCEMENT?

The onus is upon the wife to rebut the presumption of advancement that arises in relation to the purchase of AA.
In her affidavit sworn 9 December 2011, the wife says, “I do not believe that my mother gave me one half of the proceeds of the sale of the [Suburb F] investment property”. However that is not the issue. It is not asserted that the wife’s mother gave her funds for the purchase of AA. The assertion is that the wife’s mother paid the whole of the purchase price of AA. That is not disputed.
The husband’s evidence is that the wife’s mother said to the wife, in his presence, “I have given you half of the unit. You do not have to pay for it. It will be all yours eventually”. The wife in response says, “I do not recall my mother saying anything about the unit being mine “eventually”. The wife says, referring to AA, “We bought it as tenants in common in equal shares”. She also says “As far as I was concerned it was my mother’s unit and as her only child she allowed me and my family to use it”.
The wife brings no evidence of actual intention at the time of the purchase, either her own intention, or that of her mother. Only such evidence could rebut the presumption of advancement.
On behalf of the respondents it was submitted that the presumption of advancement in relation to AA was rebutted. Firstly the respondents submit that at the time of the purchase of AA, the wife was not in need of financial assistance. The respondents did not refer to any authority that suggested this was a relevant consideration. It is not.
Secondly, it is submitted that the fact that the wife’s mother purchased D property solely in her own name is evidence of the fact that she did not regard the wife as having an interest in AA. That argument is circular. Evidence of what occurred in 1991 when D property was purchased cannot be evidence of the intention of the wife’s mother in 1976 when AA was purchased.
The presumption of advancement is not rebutted.
Accordingly, the wife held one half share of AA both legally and beneficially.

WHAT WAS THE BENEFICIAL OWNERSHIP OF THE PROCEEDS OF SALE OF AA?

It follows from the conclusion above, that the wife was the owner of one half of the proceeds of sale of AA or $171,250.

DOES A RESULTING TRUST ARISE IN FAVOUR OF THE WIFE FROM THE APPLICATION OF $171,250 TO THE PURCHASE OF D PROPERTY?

The husband negotiated the purchase of D property with the vendors. He was the solicitor acting for the purchaser. He deposes to conversations with the wife’s mother, in the presence of the wife where he said “The unit will be in your name but you will hold it on behalf of yourself and (the wife)”. The wife responds to this evidence in her affidavit sworn 9 December 2011. She says “I deny that I told my mother that she would hold the unit on trust for me. I would never have said such a thing to her”.
In his affidavit sworn 13 December 2013 the husband says:
I said to (the wife’s mother) in the presence of (the wife); “You will both contribute your half share of the [AA] sale and the bank will lend us the balance of $130,000 to buy the new unit. You will not have to pay any cash. The unit will be in your name but you will hold it on behalf of both yourself and (the wife).” I recall (the wife’s mother) saying “Whatever (the wife) wants to do is all right with me. It will be hers anyway”.
In response to that evidence the wife in her affidavit sworn 4 February 2014 said: “I do not admit. I cannot recall having had the conversation described, nor my mother saying the words quoted.”
The only evidence of the actual intention of the parties to the transaction is that of the husband. The wife gives no evidence which is capable of rebutting the presumption that the parties who contributed the purchase money should hold on resulting trust in the proportion in which they contributed.
On behalf of the respondents, it is submitted that the only rational inference to be drawn from the facts is that the wife intended to make a gift to her mother of one half of the proceeds of sale of AA, resulting in the wife’s mother being the sole owner of D property. However, that was not the wife’s evidence.
Nothing in the circumstances surrounding the transaction of the purchase of D property is inconsistent with the husband’s evidence and his explanation to the wife’s mother of the manner in which D property would be held.
On behalf of the respondents it is submitted that the evidence of the wife in cross-examination that she left all the arrangements to the husband and had no recollection of any conversation with him or with her mother about the details of the transaction, gives rise to an inference that the wife intended her mother to benefit from the application of the AA sale proceeds. That evidence is equally consistent with the husband’s version of the transaction.
As the Full Court stated in Vadisanis & Vadisanis and Anor [2014] FamCAFC 97:
The correct time to determine the beneficial interests in a property is at the time of acquisition. This is to be ascertained by evidence of the acts and declarations before or at the time of purchase or so immediately after it as to constitute a part of the transaction (Calverly v Green at 262). However, as was explained in Trustees of Property of Cummins (a bankrupt) v Cummins (2006) 227 CLR 278 at [65]:
… whilst evidence of subsequent statements of intention, not being admissions against interest, are inadmissible, evidence of facts as to subsequent dealings and of surrounding circumstances of the transaction may be received. [footnote omitted]
The wife’s evidence that the husband and the wife borrowed $160,000 and contributed that money to the purchase price is consistent with the husband’s version of the transaction and inconsistent with the wife’s assertion that she had no interest in D property. Rhetorically, why would the husband and the wife borrow $160,000 for the purchase of a property in which they, or the wife, had no interest?
The fact that the husband and the wife paid any shortfall between rental income and outgoings in relation to D property is also consistent with the version of events for which the husband contends.
The presumption that a resulting trust arose from the wife’s contribution of purchase money for D property is not rebutted.
The wife had an interest in D property of 34.09 per cent by virtue of her payment of that proportion of the purchase price.

WHAT INTEREST ARISES IN THE HUSBAND AND THE WIFE FROM THEIR CONTRIBUTION OF THE SUM OF APPROXIMATELY $146,000 TO THE PURCHASE PRICE OF D PROPERTY?

There is no dispute that the husband and the wife borrowed $160,000 secured against D property and contributed $146,000 towards its purchase. $16,000 was contributed for stamp duty and $131,748 was contributed on settlement of the purchase.
There was no dispute that neither the wife nor her mother would have been able to borrow $160,000 at that time.
The wife was adamant that the money was not lent to her mother. She did not otherwise attempt to characterise the advance.
It was not disputed by the wife that, if the husband and the wife, on behalf of the wife, contributed $146,000 towards the purchase price of D property, then a resulting trust arose in favour of the wife.
On behalf of the respondents it was submitted that the sum of $146,000 was a loan from the parties to the wife’s mother. The doctrine of resulting trust does not apply where a person lends money to another person who then uses that money to acquire property.
The husband disputes the assertion that there was a loan but carried the advance as a loan in his partnership accounts.
The wife gave evidence, both in her affidavits and orally, that there was no loan to her mother.
The husband relies upon the document dated 13 June 1991 produced by the Advance Bank noting the purpose of the borrowing as being to assist with the purchase of D property for $472,000. That document does not assist the husband to prove that the money was not lent to the wife’s mother as he asserts in his accounts referred to below and, as he asserted on the death of the wife’s mother, when he made a claim against the estate.
In his affidavit sworn 30 September 2011, the husband says “On (the wife’s mother’s) death I claimed the $145,000 which (she) owed the [D and J Gillim] partnership as a debt of the estate”. The executors declined to accept the claim as they determined the debt was statute barred.
The respondents rely upon entries in the financial statements of the partnership between the husband and the wife. In 1998 and 1999 the Balance Sheet lists, under the heading “Non-Current Assets”, “Loan – [Ms B] (Debt on Unit) of $145,490.02. The same entry appeared on the Balance Sheets for 2003, 2004 and 2005.
The husband was cross-examined in relation to those entries. He agreed that he used those financial statements to base the taxation returns of the partnership and held them out to be correct.
In his affidavit sworn 15 April 2014 the husband says that, after the purchase of D property, he had a conversation with his accountant about the way in which the $160,000 was to be reflected in the partnership accounts. He says:
I did not instruct him to include any loan except our loan from the Advance Bank. I do not know why he included a loan of $145,490.02 to (the wife’s mother). I do not know the relevance of that amount. It is not the amount we borrowed from the Advance Bank and is not the amount we contributed towards the purchase price of the [D property] unit.
The husband cannot, on the one hand, assert for the purpose of the financial statements of the partnership that the money was lent to the wife’s mother and, on the other hand, assert that the advance was part of the purchase money of D property so as to create a resulting trust. I cannot, in light of the husband’s failure to provide an alternate explanation for the loan entries in the financial statements and his attempt to make a claim against the estate, find that the $146,000 represents part of the purchase price of D property so as to create a resulting trust in favour of the wife or the husband.
Accordingly, it is necessary to consider whether the funds provided by the husband and the wife to the wife’s mother for her purchase of D property may be characterised as a loan which is currently enforceable against the wife’s mother’s estate.
The respondents assert that the funds provided by the parties should be characterised as a loan which is statute barred. The husband and the wife dispute the existence of the loan and accordingly have not provided any evidence to dispute the respondent’s contention that the asserted loan is statute barred. There is no evidence before the Court regarding the terms of the asserted loan, particularly as to whether it was repayable on demand or on the happening of some agreed event.
The applicable law in the present case is the Limitation Act NSW (1969) (“Limitation Act”). Section 63(1) of the Limitation Act provides that:
Subject to subsection (2), on the expiration of a limitation period fixed by or under this Act for a cause of action to recover any debt damages or other money, the right and title of the person formerly having the cause of action to the debt damages or other money is, as against the person against whom the cause of action formerly lay and as against the person’s successors, extinguished.
Therefore, the legislation applicable in the present case operates to extinguish the cause of action rather than to simply bar the availability of a remedy.
Section 14 of the Limitations Act provides that the limitation period for a cause of action founded on a contract not being a cause of action founded upon a deed is six years running from the date on which the cause of action first accrues to the plaintiff.
As there has been no contrary evidence provided to the court, it will be assumed that if there was a loan by the husband and the wife, the cause of action for the repayment of that loan would have arisen in 1991 when they provided the funds to the wife’s mother. This accords with the reasoning of Fullagar J in Ogilvie v Adams [1981] VR 1041, where he stated at 1043 that:
In order to prevent a cause of action for recovery arising in A instantaneously on paying the money, the parties must expressly contract out of that situation by words clearly inconsistent with that situation. The courts have long since settled it that a mere statement or agreement that the money is repayable on demand (or request or at call) is not sufficient to contract out of that situation where all else that is known of the terms of the contract is that A has paid money to B by way of loan. The lender’s cause of action still arises instanter on the receipt of the money by the borrower, so that the lender’s cause of action becomes statute barred at the expiry of six years after the receipt of the money
In light of the assertions of the husband and the wife that there was no loan, and in the absence of any evidence before the Court to show that, if there were a loan as contended by the respondents, that loan is not statute barred, I cannot find that the $146,000 provided by the parties to the wife’s mother is a loan which can be enforced against her estate.
However, having regard to the fact that the provision of approximately $146,000 by the husband and the wife to the wife’s mother upon her purchase of D property is not in dispute, these funds should be given proper weight as a contribution pursuant to section 79 of the Act.

WHAT WAS THE BENEFICIAL OWNERSHIP OF D PROPERTY?

The wife is therefore the beneficial owner of 34.09 per cent of D property. The agreed value of D property is $1,250,000. The value of the wife’s interest is $426,125.

THE BALANCE SHEET

There is no dispute between the husband and the wife about the value of the assets they jointly accumulated.
Because both the parties are over 70 years of age, superannuation is included as an asset.
The wife asserts that sums should be “added back” to the Balance Sheet. Those matters will be dealt with in the consideration of section 75(2) factors and not as assets.
Having determined the value of the wife’s interest in D property and the amount of the debt owed to the husband and the wife, their assets are:

Ownership		Description	Value
1	Joint	G Street, Suburb F	$400,000
2	Wife	E Street, Suburb F	$150,000
3	Wife	2 E Street, Suburb F – sold (settlement pending)	$150,000
4	Wife	NAB Accounts x 2	$4,859
5	Wife	3019 Beach Energy Shares (BPT)	$5,300
6	Wife	600 Telstra Shares- See Note 1	$3,300
7	Husband	1823 IAG Shares	$11,357
8	Wife	AMP Policy No … on husband’s life- Wife is assurer. Husband has borrowed against policy.	$23,432
9	Wife	AMP Policy No … on husband’s life- Wife is assurer. Husband has borrowed against policy. Wife pays interest. Surrender value at 26.1.13 – Husband's affidavit Annexure S	$9,236
10	Wife	Motor vehicle 1	$5,000
11	Husband	CBA Bank Accounts	$22,215
12	Husband	Two AMP (formerly AXA) Life Policies on the life of the husband (Annexure SA H's affidavit)	$5,032
13	Husband	Motor Vehicle 2 registration no. …	$8,000
14	Wife	Interest in D property	$426,125
15	Husband	51 Tabcorp Shares	$176
16	Husband	Shares in Mr D Gillim Family Trust – 600 Telstra	$3,300
17	Husband	Monies held in Trust on account of costs
18	Husband	Shares in Mr D Gillim Family Trust – 600 Telstra	$3,300
19	Husband	Monies owed to Husband from sale of Suburb Z property as per annexure G of Husband’s affidavit filed 26 April 2013	$34,445.50
20	Husband	Superannuation	$26,347

Total

$ 1,291,424,50

The assets in the control of the husband, including his superannuation, are valued at $114,172.50 ($114,173).
The balance of the assets are in the possession or control of the wife.
LIABILITIES
There is no dispute that the balance of the St George loan is $131,298.
The husband does not dispute the liability for capital gains tax on the sale of 2 E Street.
The wife claims a debt to the B Trust which is the testamentary trust of her late mother. There is no evidence to base that claim but it appears on the Balance Sheet to be admitted by the husband as a liability.
The liabilities of the parties are:

Joint	Loan to St George-secured over Suburb D property (recent drawings by husband plus interest)	$131,298.00
Wife	Debt to B Trust	$16,000.00
Wife	CGT Liability on sale of 2 E Street	$11,700.00
$158,998

The net asset pool is $1,132,426.50 (1,132,427).
The wife will be responsible for the repayment of the liabilities.

SECTION 79(2)

It was not contended on behalf of either party that it would be appropriate for the assets of the parties to remain when they lie. It is necessary to deal with their jointly held assets, being the assets of the Family Trust, and to account for the significant contribution by the husband toward the wife’s present interest in D property.
Having regard to the massive disparity between the assets in the control of each of the parties, at the end of a marriage of nearly 50 years where the wife has the control of all of the assets of significance, it is appropriate to make a more equitable distribution of the assets.

CONTRIBUTIONS ON BEHALF OF THE HUSBAND AND THE WIFE BY THEIR RESPECTIVE MOTHERS

On behalf of the wife it is contended that the husband’s initial contributions and the contributions made by the husband’s mother should be given no weight because they have been overtaken by the numerous and substantial contributions made since that time by the parties. Those contributions have been set out in the consideration of the parties’ joint and several property and business dealings.
However, Counsel for the wife submits that the contribution by the wife’s mother of the wife’s share of the purchase price of AA is a significant contribution such that the Court should find that the contributions to AA and thus to D property should be assessed as 90 per cent to the wife and 10 per cent to the husband.
That submission has no logic as can be shown when the relevant contributions are directly compared.
AA was purchased by the wife and the wife’s mother as tenants in common in equal shares in May 1976 for $41,000. Thus, the contribution of the wife’s mother towards the wife’s acquisition of the wife’s interest was $20,500 in 1976. The wife’s interest in AA carried forward to D property without any further contribution by the wife’s mother. Indeed it was the parties who contributed the difference between the sale price of AA and the purchase price of D property to enable the purchase.

The value of the unit investments has increased beyond that of the investments which the husband and the wife made using the money from the husband’s mother. However, the evidence is that the decision to sell AA and buy D property, and the negotiations which led to the purchase of D property were conducted entirely by the husband and thus he made a significant contribution to the increase in value of the unit assets. The wife does not claim to have made any contribution to those negotiations or to the increase in the value of either of the unit properties.
It is not disputed that from the time D property was purchased in 1991 until separation in 2000, it was the husband who was responsible for the management of the property and that any shortfall in rent available to meet the outgoings in D property was contributed from the joint funds of the husband and the wife.
The husband’s mother gave the parties $18,000 in 1971 to buy the former matrimonial home. In 1974 she transferred her interest in the farming partnership to the Family Trust. In 1982 she gave the parties $44,333 from her share of the sale of the family farm and the husband inherited her home in H Street in 1983 and sold it for $45,000. This latter contribution alone was later in time than the contribution of the wife’s mother and more than double the value.
However, in circumstances where the husband does not suggest that there should be any adjustment in relation to that disparity of contribution, it is appropriate to make none.

CONTRIBUTION ASSESSMENT

This is a very long marriage. The parties married almost 50 years ago.
They bought and sold numerous properties, engaged in businesses and raised and educated their three children.
They agree that their contributions to the property they have acquired, with the exception of the wife’s interest in D property and in the estate of her late mother, should be regarded as equal.
The issue regarding the manner in which the contribution by the wife’s mother of a half share in AA should be treated and the wife’s assertion that this contribution significantly outweighs both the husband’s initial contribution and the contributions of the husband’s mother has been dealt with above. There will be no adjustment in favour of the wife for the contribution by her mother toward AA.
However, it is appropriate that there be an adjustment in favour of the husband to account for his contribution toward the acquisition of D property by the wife’s mother, where the wife retains an interest in the B Trust and the husband does not. The B Trust includes the majority interest in D property. That is the major asset of the estate. The contribution of the husband and the wife of $146,000 towards the purchase of D property in 1991 was a contribution of approximately 31.8 per cent of the purchase price. Thus, there was a substantial contribution made by the parties to the assets of the estate. The money was borrowed and the loan was ultimately paid out from the sale of 2 E Street. The husband and the wife do not have the benefit of the proceeds of sale of 2 E Street but the wife has the benefit of her interest in the estate, albeit as a discretionary beneficiary, and the husband, who contributed to that interest, will derive no benefit from his contribution.
The wife’s beneficiary interest in the B Trust is a financial resource. The documents which were tendered indicate that between November 2009 and November 2013 the wife received payments from the B Trust totalling $174,397. There is no reason to conclude that the wife will not continue to receive substantial payments from the B Trust, as she has in the past.
It is appropriate that the husband’s contribution to the wife’s financial resource should be recognised.
An adjustment is required in favour of the husband. The amount of the adjustment recognises the fact that the contribution was made in 1991 and the parties made other significant contributions after that time. It also recognises that, although the parties paid the interest on the money they borrowed to make the contribution until they separated, the wife was responsible for payment of the interest (albeit using the rent from D property) after separation. There will be an adjustment of 2 per cent.

PROPERTY DISPOSED OF AFTER SEPARATION – SECTION 75(2)

After separation, each of the parties used joint property.
The wife asks the Court to “add back” or otherwise take into account the sum of $150,000 which the husband drew from the mortgage to St George in March 2012 but to disregard the amounts that she received from the sale of jointly acquired property.
The appropriate manner for those matters to be taken into account is in considering the section 75(2) adjustment.
The wife sold V Street and the 32 acre block in R Street. In her Financial Statement sworn 25 July 2014, the wife says “We have sold the V Street property and the 30 acre block. I cannot recall the details but the remaining amount was about $18,000 from which I paid legal fees of $10,000.”
The husband’s unchallenged evidence is that the 32 acre block on R Street sold for $136,000 in July 2008 and V Street sold for $150,000 in November 2008. Having regard to the wife’s bank statement to which reference is made in the following paragraph, and remembering that there was a mortgage over V Street, it may be that those dates should be reversed.
Annexure D to the affidavit of the husband sworn 15 April 2014 is a copy of the wife’s bank statement showing payment into her account of $62,383 on 21 July 2008 and $130,000 on 24 November 2008. On 2 January 2009, the balance of the wife’s account was $197,741.56.
On 7 October 2011 the husband filed an application seeking an interim payment from the wife of $150,000. He was not working at that time.
Annexed to the affidavit of the husband sworn 13 December 2013 at page 142 is a copy of a bank statement which the husband says is for an account in the name of the wife. At 15 November 2011 that account had a balance of $180,812.80 which the husband deposed to be the proceeds of sale of V Street and R Street. He was not challenged in relation to that evidence.
On 30 November 2011 the wife, without notice to the husband, paid $160,000 to St George to reduce the loan which had been taken out by the parties in relation to D property and extended by a further $60,000 to cover farming losses. That left a balance owing to St George of $61,326.50 according to the statement which is annexed at page 166 of the husband’s affidavit referred to above.
Thus, the wife has accounted for the proceeds of sale of V Street and R Street with the exception of approximately $37,000 (the difference between the $197,741.56 she had in January 2009 shortly after the sale of the properties and the $160,000 paid to St George in November 2011).
In March 2012 the husband drew down on the St George account and withdrew a total of $150,000.
His accounting for that sum is found at paragraph 127 of his affidavit sworn 13 December 2013. It was not challenged.
·$80,000 was paid towards the payment of mortgage instalments relating to the property at Suburb Z;
·$14,600 was paid to lawyers;
·The balance was spent on living expenses including repayment of credit card debts which had been used for living expenses and the husband’s share of the outgoings related to Suburb Z.
The amount of $80,000, paid towards Suburb Z, was later drawn down and $50,000 was paid by the husband for legal fees, meaning that the husband retained $30,000 of the drawings. On settlement of the sale of Suburb Z the husband was entitled to $50,176 from which a further $30,000 was paid for legal fees and the husband retained $20,000.
Thus, the husband received $50,000 from his investment in Suburb Z after the payment of legal fees totalling $80,000.
The husband brings into account in these proceedings savings of $22,215 and a claim for money from the sale of Suburb Z of $34,446, a total of $56,661. Thus, the husband has accounted for the whole of the money received by him from the sale of Suburb Z.
The wife sold 2 E Street shortly before the hearing for $150,000. In her evidence-in-chief she said that she paid $131,298 toward the debt secured over D property. There were no agents’ fees or commission as the property was sold privately. The wife retained the balance of about $18,000. (In the Balance Sheet the parties have included the property at 2 E Street and the mortgage to St George as if that transaction had not been completed. This makes no difference to the net asset position.)
From the sale of jointly owned assets, the wife has retained for her own use about $55,000 ($37,000 from the sale of R Street plus $18,000 from the sale of 2 E Street). She has also had the sole use of the income from the two E Street properties and occupied the most significant asset that the parties had acquired, the former matrimonial home. In addition, the wife has received distributions from her late mother’s estate. Bank statements tendered in the wife’s case show payments to the wife between November 2009 and November 2013 totalling $174,397. Some of the money received by the wife has been used to pay legal fees but it is not possible to ascertain what amount.
The husband received $150,000 which, taking into account the purchase and sale of Suburb Z, was used by him to pay legal fees of $94,600 and the balance has been used for living expenses. He brings back into account the $56,661 received from Suburb Z.
In addition to the $55,000 retained by her after the sale of the jointly held R Street and 2 E Street properties, the wife has also had the use of $174,397 from her mother’s estate. Therefore, the wife has received funds totalling $229,397 after separation. She has also had the rental income from the E Street properties. In addition, from separation in 2000 until the trial, the wife has had the use and occupation of the former matrimonial home which is one of the parties’ most significant assets.
The wife was not in paid employment and since 2009, the husband has not had income from employment.
I am not satisfied that it is appropriate for there to be any adjustment on the basis of those transactions to which reference has been made in this context.

SECTION 75(2)

The husband does not contend that there should be any adjustment.
The wife contends for an adjustment in her favour in the event that she is found, as she has been, to have an interest in D property.
The wife retains her interest as a beneficiary in the residuary estate of her late mother. Thus far, she has received the whole of any income available for distribution from the estate. There is no reason to assume that this will not continue for her life time.
The husband will have no earning ability from personal exertion and no source of income comparable to that which the wife receives from the estate.
Neither party is capable of employment.
No further adjustment for section 75(2) factors is warranted.

CONCLUSION

The net asset pool is $1,132,427. The husband is entitled to 52 per cent of the net assets of the parties, or $588,862. He has $114,173. Therefore the wife must transfer to him money or assets to the value of $474,689.
The wife wishes to have the opportunity to retain the former matrimonial home.
She proposes to transfer to the husband her interest in E Street valued at $150,000 and to assign to him her interest in the Family Trust. The only asset of the Family Trust is Telstra shares. The wife’s interest in these shares is valued at $3,300. Thus, the wife will transfer property to the value of $153,300 to the husband and pay to him a further amount of $321,389.
She should have three months to pay the amount due to the husband. In default of payment, the matrimonial home should be sold to satisfy the payment to the husband.

ANCILLIARY ORDER SOUGHT BY THE HUSBAND

The husband seeks orders for the winding up of the partnership formerly operated by the husband and the wife and the taking of partnership accounts.
The partnership has no assets. There is no utility in taking partnership accounts.

I certify that the preceding two hundred and seven (207) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rees delivered on 29 August 2014.

Associate:

Date: 29 August 2014

[2014] FamCA 701

29 August 2014

Key Legal Topics

Areas of Law

Family Law

Equity & Trusts

Legal Concepts

Constructive Trust

Limitation Periods

Reliance

Res Judicata

Restitution