GIMONDI & GIMONDI
[2015] FamCA 506
•2 July 2015
FAMILY COURT OF AUSTRALIA
| GIMONDI & GIMONDI | [2015] FamCA 506 |
| FAMILY LAW – PROPERTY – property settlement – where issue of the present asset pool and financial resources of the parties – where the husband has an interest in a family owned company – assessment of contributions—consideration of relevant s 75(2) factors – where splitting order of superannuation considered and such order not made. |
| Family Law Act 1975 (Cth) ss 75, 79 |
| Aleksovski v Aleksovski (1996) FLC 92-705 |
| APPLICANT: | Mr Gimondi |
| RESPONDENT: | Ms Gimondi |
| FILE NUMBER: | PAC | 111 | of | 2012 |
| DATE DELIVERED: | 2 July 2015 |
| PLACE DELIVERED: | Parramatta |
| PLACE HEARD: | Parramatta |
| JUDGMENT OF: | Foster J |
| HEARING DATE: | 6, 7 and 8 May 2015 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Rosic |
| SOLICITOR FOR THE APPLICANT: | Rowlandson & Co Solicitors |
| COUNSEL FOR THE RESPONDENT: | Ms Christie |
| SOLICITOR FOR THE RESPONDENT: | Fox & Staniland Lawyers |
Orders
That within three months from the date of these orders the wife pay to the husband $498,153 and in consideration of such payment the husband do all things necessary to transfer to the wife his interest in the home at B Street, Suburb C NSW (Folio Identifier …).
Concurrently with the transfer to the wife as provided the wife shall do all things necessary to procure a discharge or refinance of the present mortgage secured against the home to the effect that the husband shall be relieved from all or any liability in regard to that mortgage.
That within 7 days from this date the husband deliver up to the wife’ solicitors all keys and door remotes for the property in his possession.
That pending payment to the husband and transfer of the property to the wife or sale of the property the wife have sole use and occupation of the property to the exclusion of the husband.
That upon payment to the husband of the sum provided for in Order 1 or upon completion of the sale of the property as provided whichever is the earlier date then interim orders made on the 4 June 2014 be discharged as and from that date.
That the wife shall make available for collection by the husband from the home his personal items of personalty as agreed by her still remaining at the home within 14 days from the date of orders on a date and time nominated by the wife and for this purpose the husband shall provide to the wife a list of items nominated by him as such within 7 days from the date of these orders.
That otherwise the wife retain:
(a) Contents at B Street;
(b) CBA account …;
(c) CBA account …;
(d) Japanese motor vehicle;
(e) Her Jewellery;
(f) Her Superannuation; and
(g) Wine in her possession.
That otherwise the husband retain:
(a) CBA account …;
(b) CBA account …;
(c) Chase account …;
(d) German motor vehicle;
(e) Shareholding in Gimondi Pty Ltd;
(f) Shareholding in Q Pty Ltd;
(g) Contents at Suburb P;
(h) His firearms;
(i) His Jewellery and watch collection;
(j) His book collection;
(k) His loan to current partner.
That in default of the wife paying to the husband the sum provided for in Order 1 above within four months from the date of these orders the husband and wife shall do all things necessary to sell the property at the best price reasonably obtainable and on sale the proceeds of sale shall be applied as follows:
(a) In payment of selling costs, legal costs on sale and commission;
(b)In discharge of the present mortgage in respect of which the wife shall continue to meet payments until sale;
(c) In payment to the husband of whichever is the greater of:
(i)$498,153 together with interest accrued thereon; or
(ii)The sum calculated as follows:
(498,153 divided by 2,000,000) multiplied by the gross sale price of the property;
(d)Balance to the wife from which she shall pay any outstanding outgoings by way of Council, Water rates and insurances in relation to the property as at date of settlement of the sale.
Liberty to apply as to implementation or enforcement of these orders.
That any application for costs be by way of Application in a Case supported by affidavit filed within one month from the date of these orders.
BY CONSENT IT IS FURTHER ORDERED THAT:
That the husband within one month from the date of these orders do all things necessary to transfer to the wife one half of his Frequent Flyer points as at the date of these orders and the wife do all things necessary to ensure that she is a member of such Frequent Flyer program or programs so as to facilitate such transfer or transfers.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Gimondi & Gimondi 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 PARRAMATTA |
FILE NUMBER: PAC 111 of 2012
| Mr Gimondi |
Applicant
And
| Ms Gimondi |
Respondent
REASONS FOR JUDGMENT
The present matter for determination is the competing applications for property adjustment as between the applicant husband and the respondent wife.
At trial the applicant husband sought orders that in summary provide:
a)That the property at B Street, Suburb C be sold and that on sale after payment of selling expenses and a discharge of mortgage $110,000 be paid to the husband and the balance divided equally between the husband and wife;
b)That pending sale the wife be solely responsible for payment of property outgoings;
c)That there be a splitting order as to 50 per cent of the husband’s interest in the MLC Wrap Super Fund in favour of the wife;
d)That within 7 days the wife make available for delivery up to the husband certain items of personalty;
e)That the husband and wife close Commonwealth Bank accounts …, … and … with the balances to be distributed equally to the husband and wife;
f)That the husband and wife close Commonwealth Bank account … and the balance be paid to the husband; and
g)Costs.
The wife for her part sought orders at trial in summary as follows:
a)That within 90 days from the date of orders the wife pay to the husband $110,000 and in consideration of that payment the husband transfer to the wife his interest in the B Street property;
b)That concurrently with the transfer the wife refinance the mortgage secured over that property so as to release the husband from all or any liability in relation to same;
c)That pending transfer of the B Street property to the wife the husband pay to the wife $260 per week by way of spousal maintenance and private health insurance premiums for the wife’s benefit;
d)That the husband transfer to the wife 282,662 Frequent Flyer points within 14 days from the date of orders;
e)That the husband and wife close Commonwealth Bank account … and the balance be paid to the wife;
f)That the parties close Commonwealth Bank account … with the balance to be paid to the wife;
g)That the husband indemnify the wife from all or any liability howsoever arising from Gimondi Pty Ltd (“the company”);
h)That the wife indemnify the husband from all or any liability in respect of the wife’s debt to her mother of $10,000; and
i)Costs.
At trial the husband relied upon the following documents:
a)His affidavit filed on 9 April 2015;
b)His financial statement filed on 9 April 2015;
c)Affidavit of Mr D Gimondi filed on 9 April 2015; and
d)Affidavit of Ms E Gimondi filed on 9 April 2015.
At trial the wife relied upon the following documents:
a)Her affidavit filed on 13 April 2015;
b)Her financial statement filed on 13 April 2015;
c)Affidavit of Mr F filed on 17 April 2015.
Context
At trial the wife was aged 54 and the husband 53.
The wife has various health issues but it is not asserted that they prevent her from continuing her current employment.
The wife is currently employed full-time as a secretary/administrative assistant earning an income of about $52,000 per annum. The wife also presently receives periodic spouse maintenance payments from the husband of $260 per week by way of interim order made on 4 June 2014. The husband is employed by his parents company earning about $294,000 per annum on average over the last 5 financial years.
The wife remained in full-time employment until she commenced maternity leave in February 1992 and with her mother’s assistance returned to part-time work in December 1992. The wife gradually increased hours to 4 days per week in 2009 and from 2011 she recommenced full-time employment.
The husband at all relevant times was in the employee of his parents’ company. During the relationship the husband was able to pursue further study, enrolling in university in 1994 and obtained a degree in 1999 and thereafter a second degree in 2003. He completed a graduate certificate in 2003 and was admitted as to a professional association in July 2003.
The wife supported the husband in his further studies undertaking a more onerous obligation in relation to the home and the children by reason of the husband’s unavailability due to his study, his work commitments and overseas travels.
In April 1977 the company was incorporated and the husband’s parents held one ordinary share each in the company. The husband’s father was chairman and governing director and the husband’s mother the other director.
In February 1978 the company issued 1000 more shares. 499 ordinary shares were issued to each of the husband’s father and mother, one D class share was issued to the husband and one C class share issued to the husband’s brother Mr G Grimondi. The C and D class shares entitled the husband and his brother to dividends at the discretion of the governing director.
The husband commenced working in the business of the company in about 1980. In 1983 the husband’s parents purchased premises at H Street, Suburb I and the business operated by the company moved to those premises.
In November 1989 the husband and wife purchased a property at Suburb J. The purchase price of about $200,000 comprised significantly funds provided by the husband’s parents’ by way of a gift of about $100,000, about $90,000 paid by the husband with the balance from the wife or her parents. Subsequent to purchase of this property it was renovated by the wife’s father with the assistance of the husband and his father.
In 1990 the husband and wife signed an agreement providing that funds gifted by the husband’s parents to the purchase of the Suburb J property would be repaid in the event that the husband and wife separated. In the same year the wife’s parents lent to the parties $20,000 that facilitated the completion of the renovation work on the property. This loan was paid back by the parties within three years.
The parties married in 1990 and commenced cohabitation from that time.
There are two children of the marriage now aged 23 and 21. Both children reside with the wife in the matrimonial home at Suburb C. The eldest is completing tertiary studies and works part-time for the husband in the company. The youngest is a fourth year apprentice.
The parties’ assets at the commencement of cohabitation were as follows:
Joint: The property at Suburb J
Husband: Japanese car
Husband: C class share in the company
Husband: Superannuation
Wife: Italian car
Wife: Modest savings
Wife: Superannuation
Wife: Piano
Wife: Furniture and personalty
In July 1993 the parties sold the Suburb J property for $320,000. Following the sale of this property and until the parties moved into the property purchased by them at B Street, Suburb C they resided at the wife’s parents’ home.
The B Street property was purchased for $400,000 with the purchase price comprising the net proceeds of the Suburb J property of about $315,000 and a mortgage advance of about $100,000.
Subsequent to the purchase of the B Street property, the property was renovated and improved by work undertaken by the wife’s father and the husband. Certain other renovation work was undertaken later in 2003 by the wife’s father and her brother. Funds for this later renovation were in part provided by way of an interest-free loan from the wife’s parents of $36,000. These funds were not paid back until 2010/2011.
In 1996 the parties refinanced the mortgage secured over the B Street property and borrowed by way of a line of credit $350,000.
In June 1994 the husband and his brother were both made directors of the company with the husband’s father retaining control as governing director. The husband’s father is 83 years of age and retains an active role in the control and conduct of the business and its finances.
In June 2002 the company Q Pty Ltd was incorporated with the husband, his brother and his parents all directors and equal shareholders. It is common ground that this company does not trade and the husband’s interest in the company is of no value.
Between December 2006 and October 2007 the parties received by way of gift from the husband’s parents funds totalling $450,000. The husband’s father’s evidence is that in this financial period the company was not in a financial position to pay a significant discretionary dividends to the husband which was the way that he had been historically remunerated by the company in addition to a modest PAYE salary. In the 2007 financial year the husband was paid a salary of $42,394 and a franked dividend of $72,000 (Exh T). In 2008 the husband’s remuneration was the same.
In such a circumstance the husband’s father drew against his loan account with the company and paid funds to the husband. The inference is that the funds paid to the husband were in part by way of remuneration for his work in the company and in part a gift from his father. The significance of the payments in a contributions sense is thus somewhat reduced.
Funds paid by the husband’s father were in part used to pay down $375,000 off the parties’ mortgage and provide for private school fees for the children. In addition the husband’s parents paid significant private health insurance premiums for the parties.
During the course of the husband’s employment with his father’s company he has received remuneration variously by way of a combination of a dividend to which he has a discretionary entitlement by reason of his C class shareholding and payment of salary. Historically he had been remunerated primarily by way of dividend. More recently in the 2013 and 2014 years as a consequence of accounting advice he has substantially been remunerated by way of salary and a modest discretionary dividend. His taxable income from salary and bonuses for the 2013 financial year was $278,277 per annum. His income for the last five years has totalled $1.47 million. As a consequence of the change in the way the husband’s remuneration is now structured his salary is tax-deductible to the company and the payment of a salary to him tracks superannuation contributions and an accrual of leave entitlements.
The husband also receives benefits from the company by way of motor vehicle expenses, mobile phone expenses and has an ability to draw as against a loan account with the company.
The parties enjoyed during their relationship a comfortable lifestyle with the children attending a private school.
The parties separated in January 2013 under the one roof and finally separated in April 2013 when the husband moved out of the home at B Street into rented premises at Suburb P. The wife has remained in occupation of the home at B Street to the husband’s exclusion thereafter.
At separation the parties’ joint CBA account had a credit balance of $44,896. Following separation the husband cleared his outstanding credit card bills and income tax commitments reducing the balance of the joint account by May 2013 to $6707. The husband made irregular payments into the joint account and in November 2013 sought a sale of the B Street property, notwithstanding that in October 2013 he had received a tax refund of $17,542 in relation to the 2013 financial year.
The wife made application for interim orders in April 2014 and orders were made by consent that facilitated the wife drawing down against the existing line of credit facility secured over the B Street property $110,000 and for the husband to pay to the wife by way of periodic spouse maintenance $260 per week and maintain her private health insurance. Of the $110,000 a fund of $10,000 was set aside to meet necessary repayments on this advance until final determination of the parties’ property entitlements.
The wife has substantially applied the $100,000 received by her for payment of her legal fees and single expert’s fees.
Property Adjustment
The approach to the determination of an application under s 79 of the Family Law Act 1975 (Cth) (‘the Act’) is set out in Stanford v Stanford [2012] HCA 52 and further considered by the Full Court in Bevan & Bevan [2014] FamCAFC 19 and Chapman & Chapman [2014] FamCAFC 91.
Thus the process ordinarily involves a staged process.
The Court must identify the existing legal and equitable interests of the parties in the property, the liabilities and financial resources of the parties at the time of the hearing and then whether it is just and equitable to make a property settlement order.
Such a consideration should not be guided by an assumption that the parties’ rights to or interests in property are or should be different from those that then exist. The question is whether those rights and interests should be altered.
There is no presumption that one or other party has the right to have the property of the parties divided between them or a right to an interest in marital property that is fixed by reference to the various matters in s 79(4) (Stanford (supra)). This consideration addresses the prohibition in s 79(2) of the Act.
The Court needs to conclude that it would be unjust or unfair to leave property rights intact. Such a conclusion cannot be informed by reference to s 79(4) and s 75(2) factors.
In many cases such as this one, this requirement is readily satisfied where the parties are no longer in a marital or de facto relationship and thus, for example, the common ownership or use of property by husband and wife will no longer be possible or the express or implicit assumptions that underpinned existing property arrangements such as the accumulation of assets or financial resources by one for the benefit of both have been brought to an end with the relationship.
In particular such a circumstance arises, as in this case, where both parties seek adjustive orders but are unable to agree as to same. It is clearly in this matter unjust or unfair to leave property rights of the parties intact where there remain joint assets and liabilities. Neither party contended otherwise.
Once the s 79(2) issue is determined the Court then considers the contributions made by the parties as defined in s 79(4)(a) to (c).
The Court must then consider the subjective considerations as to the parties by having regard to the provisions of s 75(2) in so far as they are relevant. Such a consideration can include arguments as to asserted add backs, alleged waste by a party or other financial resources that it is contended should be added to the actual pool as notional property or liabilities.
In the light of the reconsideration of the role of s 79(2) as a threshold question it would be appropriate for the court then to consider the “justice and equity” of the actual orders to be made (see Russell and Russell (1999) FLC 92-877, Teal & Teal [2010] FamCAFC 120) in the context of the Court’s obligation to make “appropriate orders” as provided for in s 79(1) of the Act.
The Present Asset Pool
Exh E provides an agreed balance sheet. The assets of the parties comprise:
Assets:
Joint B St Suburb C 2,000,000
Joint CBA account … 186
Husband CBA account … 154
Husband CBA account … 2,718
Husband Chase account … 538
Husband German motor vehicle 10,000
Husband Shareholding in the company *
Husband Shareholding in Q Pty Ltd Pty Ltd 0
Joint Contents at B Street 5,000
Husband Contents at Suburb P 5,000
Husband Firearms 8,000
Wife CBA account … 1,456
Joint CBA account … 8,278
Wife Drawdown from home loan 100,000*
Wife Japanese motor vehicle 21,000
Wife Jewellery 5,720
Husband Jewellery and watch collection 15,000
Husband Book collection 2,000
Wife Wine 1,770
Husband Loan to current partner 12,700
2,199,520
Husband Long service leave *
Husband Frequent Flyer points *
Liabilities:
Joint CBA mortgage loan 110,000
Wife Debt to her mother post separation 10,000*
Husband Debt to company post separation 23,000*
Superannuation:
Husband UniSuper 8,955
Husband MLC Wrap Superannuation 322,000
Wife Colonial FSS 50,600
Matters the subject of contention are marked *. They are considered below.
a)The husbands post separation loan: This was for legal fees and will be ignored for adjustment purposes.
b)The husband’s interest in the company: The company has a value of about $2.9 million. However the husband holds a mere right to receive dividends declared solely by his father as the governing director. Thus the husband’s interest in the company was valued at nil. However it was conceded by both parties that by reason of the husband’s past remuneration history and the closely held family shareholdings in the company and the age of his parents that the company represents to the husband a significant financial resource.
c)The wife’s drawdown from the mortgage $100,000: The husband contended that these funds should be regarded as a preliminary distribution to the wife. The wife paid the funds for her legal expenses in circumstances where she had little ability to meet her own legal fees other than from capital of the parties. The husband being in receipt of significant income could meet the majority of his legal fees from that source and a small loan from the company. The imbalance between the parties in this regard renders it appropriate that the wife’s distribution not be regarded as a preliminary distribution of capital to her. It will be removed for adjustment purposes.
d)The husband’s long service leave: The Single Expert report reveals long service accrued to the husband of $52,686. The wife offers no evidence as to its value. In any event the husband contended this is merely a future financial resource, representing paid leave. The wife makes a similar contention. It is appropriate that it be considered in the context of s 75(2) matters.
e)The husband’s Frequent Flyer points: It was agreed that half will be transferred to the wife.
f)The wife’s debt to her mother $10,000: The wife’s evidence was that these funds were borrowed and used for “food clothing and essential expenses” and repayment is required. She was not cross-examined on this assertion. In light of the significant disparity as to income it is proper to include this borrowing in the pool.
g)The husband’s debt to the company $23,000: These funds were for legal expenses. By reason of the use of funds to pay legal expenses, there being no evidence of pressing repayment necessity and the disparity in financial resources the debt will be excluded.
Thus the pool for adjustment is as follows:
Assets
Joint B Street, Suburb C 2,000,000
Joint CBA account … 186
Husband CBA account … 154
Husband CBA account … 2,718
Husband Chase account … 538
Husband German motor vehicle 10,000
Husband Shareholding in the company 0
Husband Shareholding in Q Pty Ltd 0
Joint Contents at B Street 5,000
Husband Contents at Suburb P 5,000
Husband Firearms 8,000
Wife CBA account … 1,456
Joint CBA account … 8,278
Wife Drawdown from home loan omitted
Wife Japanese motor vehicle 21,000
Wife Jewellery 5,720
Husband Jewellery and watch collection 15,000
Husband Book collection 2,000
Wife Wine 1,770
Husband Loan to current partner 12,700
2,099,520
Liabilities:
Joint CBA mortgage loan 110,000
Wife Debt to her mother post separation 10,000
Husband Debt to company post separation omitted
Superannuation
Husband UniSuper 8,955
Husband MLC Wrap Superannuation 322,000
Wife Colonial FSS 50,600
381,555
The overall pool including superannuation has a net value of $2,361,075.
The Parties’ Overall Submissions
Both parties submitted that it was appropriate to make adjustive orders.
Both parties submitted for the one pool of assets including the superannuation interests of the parties. Such an approach is appropriate.
The husband contended that overall contributions should favour him 60/40, asserting that the husband’s contributions post separation to superannuation support in part the adjustment in his favour. It was further contended that a s 75(2) adjustment back to the wife in the range of 5-7.5 per cent was appropriate leaving a final result of about 52.5-55 per cent in favour of the husband.
The wife contended for equality of contributions to trial and a 30 per cent adjustment in her favour for s 75(2) matters leaving an overall result 80 per cent in her favour.
Contributions
In assessing contributions:
The task of the court in proceedings under section 79 is not akin to an accounting exercise. To borrow a phrase used by McClelland J in Davey v Lee (1990) DFC 95-084; (1990) 13 Fam LR 688 at 689 in relation to section 20 of the De Facto Relationships Act 1984 (NSW) ''the Court is required to make a holistic value judgment in the exercise of a discretionary power of a very general kind”. (Harris & Harris (1991) 104 FLR 458 at 464)
The Full Court said some 20 years ago in Aleksovski v Aleksovski (1996) FLC 92-705, per Baker and Rowlands JJ at 83,437:
It is therefore necessary that trial Judges weigh and assess the contributions of all kinds and from all sources made by each of the parties throughout the period of their cohabitation and then translate such assessment into a percentage of the overall property of the parties or provide for a transfer of property in specie in accordance with that assessment.
It really comes down to questions of weight. Whilst weight would and must be given to a contribution which a party makes shortly before the separation, less weight may be given to a contribution made by one of the parties to a marriage early in the cohabitation period of a long marriage, particularly in circumstances where the contribution has gone into the parties' assets or been used up in the payment of family expenses.
and Kay J said at 83,443:
What is important is to somehow give a reasonable value to all of the elements that go to making up the entirety of the marriage relationship. Just as early capital contribution is diminished by subsequent events during the marriage, late capital contribution which leads to an accelerated improvement in the value of the assets of the parties may also be given something less than directly proportional weight because of those other elements.
The Full Court in said in Dickons & Dickons [2012] FamCAFC 154:
23. We wish also to refer to the approach of the Federal Magistrate in attributing percentages to differing periods within the relationship, or types of contribution made. There is in our view little to be gained, and much to be said against, approaching the task of assessing contributions by attaching percentages to components of it. (The same, it might be said, applies to attributing a percentage to each of the relevant s 75(2) factors).
24. There can be little doubt that the classification of contributions by reference to terms such as “initial contributions”, “contributions during the relationship”, and “post-separation contributions”, can be helpful as a convenient means of giving coherent expression to the evidence in a s 79 case and to giving coherence to the nature, form and extent of the parties’ respective contributions. However, the task of assessing contributions is holistic and but part of a yet further holistic determination of what orders, if any, represent justice and equity in the particular circumstances of this particular relationship. So much is clear from the terms of s 79 itself and, in particular, s 79(2). The essential task is to assess the nature, form and extent of the contributions of all types made by each of the parties within the context of an analysis of their particular relationship.
The history of the relationship is considered above in detail. The husband introduced significant equity in the parties’ first property into the relationship and notably significant funds in the 2006/2007 period as referred to above. Yet the wife and her family made other significant contributions both financially and otherwise.
The wife was the primary caregiver for the children and homemaker. Such is an irresistible conclusion for the husband’s own evidence as to his work ethic and obligations as to further studies undertaken during cohabitation.
The husband seeks a disparity of 20 per cent or about $470,000 to reflect contributions and the husband’s post separation contributions to his superannuation. Such an adjustment does not properly reflect the offsetting contributions made on the wife’s side over a long relationship. Nor do they acknowledge that the husband’s income capacity has accrued over the period of the relationship. He took that capacity from the marriage and as a consequence accrued ongoing superannuation.
The husband’s contributions, however, are deserving of recognition over that of the wife.
Contributions in relation to this modest asset pool will be assessed to trial in favour of the husband 52.5/47.5. Thus creating at this stage a disparity of about $120,000 between the parties.
Section 75(2) Factors: Relevant Matters
The parties are of similar age. The wife has underlying health issues but does not contend an inability to earn what is a modest income compared to that of the husband. The husband is able to continue in his present capacity. Otherwise he is a qualified legal practitioner.
The income and financial resources of the parties are set out above. The asset pool is dominated by the value of the matrimonial home. The income disparity between the parties is significant. The husband’s capacity to earn was generated over the whole period of the relationship and it is trite to say that one of the most valuable things that many husbands take away from the marriage is their capacity to earn. It is to be inferred that the husband may well earn about another $3 million by the age of 65 and by that time, subject to decisions by his father and mother, have control with his brother of the company. The husband’s shareholding in the company and the close familial connection provides a most significant financial resource to him as properly conceded by his counsel. He has long service accruing and he will continue to accrue same. The wife on the other hand has no such prospects. She will retain modest capital assets and have a very modest income into the future. This consideration alone calls for more than just a modest adjustment in favour of the wife.
The wife has commitments set out in her financial statement. She struggles to meet same and has had to borrow from her mother. The husband has strong financial resources to meet his commitments.
Both parties have accumulation superannuation benefits. The wife will accrue very modest future entitlements. The husband has significant superannuation and by reason of recent remuneration changes in the company will continue to accrue significant superannuation benefits into the future.
Both parties enjoyed a good standard of living during the relationship.
The wife in her capacity as homemaker and that of primary caregiver for the children has contributed to the husband’s income earning capacity and to his accruing superannuation.
The wife has had her income capacity impacted by her absence from the work force with young children and then her limited ability to return to part time employment until 2011 when she resumed full time employment. She has had no opportunity to follow a career or enhance or employment skills. She is now 54.
An assessment of contribution entitlements will see the wife with the lesser proportion of the property pool.
Otherwise the wife has in her household the two adult children of the marriage that she accommodates and to an extent provides for.
Overall considering the above matters an adjustment in favour of the wife of 15 per cent is called for. That adjustment in money terms creates a disparity of about $708,000 between the parties.
Overall
A consideration of the above matters leads to a final adjustment of the pool of assets in favour of the wife of 62.5 per cent to the husband’s 37.5 per cent.
The wife’s entitlement is $1,475,671. She seeks to retain the home. In that case she will retain:
B Street, Suburb C 2,000,000
Contents at B Street 5,000
CBA account … 1,456
CBA account … 8,278
Japanese motor vehicle 21,000
Jewellery 5,720
Her Superannuation 50,600
Wine 1,770
2,093,824
Less
CBA mortgage loan 110,000
Debt to mother post separation 10,000
$1,973,824
This would require an adjusting payment to the husband of $498,153. Her capacity to do so is not readily evident. However she will be given the opportunity to do so.
This payment to the husband would give him some cash contribution to the purchase of accommodation for himself and he would otherwise retain his present assets and financial resources.
Superannuation Split
The husband contends for a splitting order as to 50 per cent of his MLC superannuation. The trustee of the fund has been accorded notice of the intended splitting order (Exh P).
Part of the husband’s contention is that the making of a splitting order will see him receive a greater cash adjustment that he may put to the purchase of his own accommodation. He will receive in any event a significant capital payment from the wife.
The effect on the wife of a split will be that she will need in all probability to sell the home and purchase with modest capital a home for herself and at present the children. A superannuation split of about $160,000 in her favour will add to her present superannuation giving her about $210,000 in superannuation. She has modest income and is aged 54. Her prospects of any significant increase in her superannuation are poor.
The wife on retirement will at best have a very modest superannuation income stream with the inference that she will need to supplement that by accessing the capital component of her superannuation until it is exhausted and then her other capital.
Otherwise if she has the opportunity of retaining the home the reality will be that ultimately she will in all probability need to sell that to realise capital to live on in the years ahead. So a superannuation split will not enhance in any significant way her prospective retirement circumstances but simply replace present equity in the home with a modest superannuation balance. The wife seeks no splitting order.
Considering the above a splitting order is not appropriate or called for in the particular circumstances of this case.
Appropriate orders
The proposed orders do not impact on either party’s earning capacity.
The wife should be afforded the opportunity of retaining the home. If not it will be sold. The sum payable to the husband should be indexed to any increase in the value of the home on any default sale.
Orders will be made accordingly.
I certify that the preceding eighty-four (84) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Foster delivered on 2 July 2015.
Associate:
Date: 2 July 2015
Key Legal Topics
Areas of Law
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Family Law
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Equity & Trusts
Legal Concepts
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Remedies
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Costs
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Consent
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Injunction
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