GLEASON & GLEASON
[2019] FCCA 451
•21 February 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| GLEASON & GLEASON | [2019] FCCA 451 |
| Catchwords: FAMILY LAW – Property – alteration of property interests – assessment of contribution and future needs – just and equitable order. |
| Legislation: Family Law Act 1975 (Cth), ss.75, 79 |
| Cases cited: Bevan & Bevan [2013] FamCAFC 116 |
| Applicant: | MS GLEASON |
| Respondent: | MR GLEASON |
| File Number: | WOC 1216 of 2017 |
| Judgment of: | Judge Altobelli |
| Hearing date: | 8 February 2019 |
| Date of Last Submission: | 8 February 2019 |
| Delivered at: | Wollongong |
| Delivered on: | 21 February 2019 |
REPRESENTATION
| Counsel for the Applicant: | Mr Schroder |
| Solicitors for the Applicant: | Johnson Horsley Lawyers |
| Counsel for the Respondent: | Ms Gillies |
| Solicitors for the Respondent: | Hansons Lawyers |
ORDERS
Within 21 days, the parties are to submit an agreed Minute of Order reflecting the Judgment delivered orally today.
In the event that an agreed Minute cannot be submitted, then:
(a)within 28 days the Wife is to submit a proposed Minute of Order; and
(b)within 35 days the Husband is to submit a proposed Minute of Order.
The matter be adjourned to a date and time to be fixed.
IT IS NOTED that publication of this judgment under the pseudonym Gleason & Gleason is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT WOLLONGONG |
WOC 1216 of 2017
| MS GLEASON |
Applicant
And
| MR GLEASON |
Respondent
ORAL REASONS FOR JUDGMENT
Introduction
By way of introduction, these Reasons for Judgment are partly oral and partly ex tempore, and explain the basis for the order altering the property interests of the Husband and the Wife in this matter. In the somewhat unusual circumstances of this case, these Reasons for Judgment are delivered in the fashion they are and the parties will be directed to submit an agreed Minute of order, or failing that, individual proposed orders within a short time of delivery of these Reasons.
The initial preparation of these Reasons was expedited because it was felt at the time the Hearing that there was an urgent need for a quick decision in the circumstances where the evidence suggested that the parties had received a conditional offer to purchase the Property A property, at a figure that appeared substantially greater than that postulated by their Single Joint Expert.
Background
By way of background, the Husband is 61 years old. He is a self-employed tradesman and lives in Suburb B. The Wife is 55 years old. She describes herself as a customer service officer and she lives in Town C. The parties commenced cohabitation in 1993, married in 1995 and separated in 2016. They have two children aged 21 and 9, the latter of whom is in her Mother’s care. The Father pays child support.
Due to concessions made about the assessment of contribution, which I will discuss below, there is really no need to go into great detail by way of background facts. The Husband came into the marriage with some real estate assets and then inherited some more. The Husband and the Wife both worked to their respective capacities during the marriage. The Husband became a successful sole trader. The Wife worked in various jobs, assisting in the Husband’s business and attending to homemaking and parenting.
The contributions they each made may well have been different and varied, but the contribution they each made was valuable.
The evidence before the Court
The evidence before the Court is listed in the case outline documents. In the Wife’s case, she relied on the following documents:
a)Initiating Application filed on behalf of Ms Gleason on 23 November 2017;
b)Affidavit of Ms Gleason filed on 31 January 2019;
c)Financial Statement of Ms Gleason filed on 31 January 2019; and
d)Case outline document prepared on behalf of Ms Gleason received 6 February 2019.
In the Husband’s case, he relied on the following documents:
a)Response filed on behalf of Ms Gleason on 22 December 2017;
b)Affidavit of Mr Gleason filed on 5 February 2019;
c)Affidavit of Mr Gleason filed on 30 January 2019;
d)Affidavit of Mr D filed on 7 February 2019;
e)Affidavit of Mr E filed on 31 January 2019;
f)Affidavit of Mr F filed on 31 January 2019;
g)Financial Statement of Mr Gleason filed on 31 January 2019; and
h)Case outline document prepared on behalf of Mr Gleason received 6 February 2019.
A number of documents were tendered during the course of the proceedings:
a)Advertisement for car park spaces prepared by Ms Gleason;
b)Letter to Johnson Horsley from Hansons letter dated 5 February 2019;
c)Letter dated 22 March 2018 to Johnson Horsley from Hansons;
d)Individual Tax Return 2017 for Mr Gleason;
e)Financial Statement of Mr Gleason filed 22 December 2017;
f)ASIC Current Organisation Extract as at 4 Feb 2019 in relation to Company G;
g)Applicant Wife’s Costs Notice;
h)Respondent Husband’s Costs Notice;
i)ATO Activity Statement – Company G – Aug 2017 – Nov 2018;
j)Credit Union – Company G Account Balance 7 Feb 2019;
k)Account Summary Credit Union Account List as at 16 January 2019; and
l)Bendigo Bank Mr Gleason Account Dec 2018 to Jan 2019.
The applicable law
This is an application under s.79 of the Family Law Act 1975 which relevantly provides:
Alteration of property interests
(1) In property settlement proceedings, the court may make such order as it considers appropriate:
(a) in the case of proceedings with respect to the property of the parties to the marriage or either of them--altering the interests of the parties to the marriage in the property; or
(b) in the case of proceedings with respect to the vested bankruptcy property in relation to a bankrupt party to the marriage--altering the interests of the bankruptcy trustee in the vested bankruptcy property;
including:
(c) an order for a settlement of property in substitution for any interest in the property; and
(d) an order requiring:
(i) either or both of the parties to the marriage; or
(ii) the relevant bankruptcy trustee (if any);
to make, for the benefit of either or both of the parties to the marriage or a child of the marriage, such settlement or transfer of property as the court determines.
(2) The court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
(4) In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(a) the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c) the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d) the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
(f) any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
Section 79(4) incorporates the provisions contained in s.75(2) of the Act, which states:
(2) The matters to be so taken into account are:
(a) the age and state of health of each of the parties; and
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c) whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d) commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e) the responsibilities of either party to support any other person; and
(f) subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g) where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha) the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant; and
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k) the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l) the need to protect a party who wishes to continue that party's role as a parent; and
(m) if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n) the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
(naa) the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i) a party to the marriage; or
(ii) a person who is a party to a de facto relationship with a party to the marriage; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p) the terms of any financial agreement that is binding on the parties to the marriage; and
(q) the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
In Bevan & Bevan [2013] FamCAFC 116, the Full Court of the Family Court of Australia considered the High Court’s decision in Stanford & Stanford [2012] HCA 52, which provided guidance on how s.79 was to be interpreted and implemented. Bevan endorsed the continuing application of the four-step approach articulated by the Full Court in Hickey & Hickey & Attorney General for the Commonwealth of Australia [2003] FamCA395, but on the basis that it is a shorthand distillation of the words of s.79, as opposed to being a statutory edict. The four steps articulated in Hickey at paragraph 39 are:
a)Identify and value the property, liabilities and financial resources of the parties; and
b)Identify and assess the contributions of the parties and express them as a percentage of the net value of the property; and
c)Identify and assess the other facts relevant under s.79(4)(d)-(g) including s.75(2) and determine the adjustment (if any) to be made to the contribution entitlements at step two; and
d)Consider the effect of the above and resolve what order is just and equitable in all the circumstances.
The decisions in Stanford and Bevan also emphasise the importance of making findings that any order is just and equitable for the purposes of s.79(2), independent of the s.79(4) process. In most cases, such as the present one, it makes no difference to the outcome of the alteration of property interests exercise. Even if the just and equitable consideration were treated as a threshold issue in this case the parties have, by their actions (separation, and re-ordering of their financial lives since then), and claims (divergent claims about their property under s.79 of the Act), indicated that they themselves consider it just and equitable that some order be made under s.79 adjusting their property interests as presently held. It is clearly just and equitable in this case to make an order.
Both decisions also emphasise the importance of identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property. This is not inconsistent with step one in Hickey.
Sometimes the Court needs to decide whether a global or asset-by-asset approach to contribution is adopted. Indeed, that is reflected on the facts of this case. The High Court’s decision in Norbis v Norbis (1986) HCA 17 makes it clear that either approach is available to the Court.
One of the issues in this case, indeed possibly the most difficult issue, was how the Court should weigh and assess the initial contribution made in this case by the Husband. The Full Court’s decision in Pierce v Pierce (1999) FLC 92-844 is helpful in this regard, and perhaps even more helpful is the more recent decision of the Full Court in Williams [2007] FamCA 313 where, at paragraphs 26, 27, 28, 29 and 32, their Honours review Pierce & Pierce. I will incorporate those paragraphs into my reasons;
[26] We think that there is force in the proposition that a reference to the value of an item as at the date of the commencement of cohabitation without reference to its value to the parties at the time it was realised or its value to the parties at the time of trial, if still intact, may not give adequate recognition to the importance of its contribution to the pool of assets ultimately available for distribution towards the parties. Thus where the pool of assets available for distribution between the parties consists of say an investment portfolio or a block of land or a painting that has risen significantly in value as a result of market forces, it is appropriate to give recognition to its value at the time of hearing or the time it was realised rather than simply pay attention to its initial value at the time of commencement of cohabitation. But in so doing it is equally as important to give recognition to the myriad of other contributions that each of the parties has made during the course of their relationship.
[27] In Pierce v Pierce when speaking of the relevance to be paid to initial contributions the Full Court (Ellis, Baker and O’Ryan JJ) referred to Fogarty J in Money v Money (1994) FLC 92-485 at 81,054; (1994) 17 Fam LR 814 at 816:
…respective contributions of the parties over a long period of marriage “offset” the significance which might otherwise be attached to a greater initial contribution by one party…ultimately, when it comes to the trial such a contribution is one of a number of factors to be considered. The longer the marriage the more likely it is that there will be latter factors of significance and in the ultimate the exercise is to weigh the original contribution with all other, later, factors and those later factors, whether equal or not, may in the circumstances of the individual case reduce the significance of the original contribution.
[28] The Full Court (Ellis, Baker and O’Ryan JJ) then said at [28]:
In our opinion it is … a question of what weight is to be attached, in all the circumstances, to the initial contributions. It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and the wife. In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use made by the parties of that contribution.
[29] Pierce v Pierce was a case in which the husband brought in $200,000 cash into the relationship. He applied that money towards the purchase of a matrimonial home. He was employed throughout the marriage and supported the wife who, whilst in some paid employment primarily attended to domestic tasks and taking care of the children. The Full Court assessed the parties’ respective contributions to a pool of $320,000 as 70 per cent in favour of the husband and 30 per cent in favour of the wife at the end of a 10 year relationship.
…
[32] In Hunt v Zuryn (2005) FLC 93-226; (2005) 34 Fam LR 169 the Full Court (Kay, May and Boland JJ) allowed an appeal in a property case where a pool of assets of $1.12million had been assessed for contribution purposes as 75 per cent in favour of the husband and 25 per cent in favour of the wife. The Court in allowing the appeal indicated that an assessment of 75:25 fell outside the realms of an acceptable range saying at 79,730; 170:
Such an assessment ought adequately recognise that much of the parties’ wealth can be attributed to the capital growth in the assets introduced by the husband at the commencement of the marriage but at the same time bringing into consideration a myriad of other contributions each made in the course of their relationship.
In effect the task for the Court is not just to identify the contributions of each party, but also to assess the weight to be attributed to those contributions, having regarding to many factors, including what occurred after the alleged contribution.
Credit issues
I need to discuss credit issues in this case, though I acknowledge that perhaps these had become less significant, given the concession made in relation to the value of the Property A property.
Nonetheless, I found the Wife to be an unreliable historian on financial matters. She was frequently unresponsive in cross-examination and failed to make reasonable and sensible concessions. Her evidence on specific issues was found by this Court to be evasive and therefore unreliable, and in this regard, there are three examples, indeed, possibly four:
a)The Wife’s knowledge and involvement in discussions about the conditional offer to purchase Property A;
b)Her actual employment arrangements;
c)Whether she would, in fact, sell the Property A property; and
d)The income from the car parking spaces at the rear of the Property A property.
This makes the Court very cautious about the Wife’s evidence, but especially in relation to the Property A property. The Wife, like the Husband, had a tendency to exaggerate the contribution she made and minimised the contribution made by her husband. I emphasise that both the Husband and the Wife did this. I do not treat this as an adverse credit issue. It merely reflects human nature.
Except in relation to the Property A property, the Court finds the Husband to be a more reliable historian about financial matters. In relation to Property A, the Court does not believe that the Husband has disclosed the full nature and extent of his knowledge about the conditional offer to purchase this property, or his conversations and communications with the agent involved. Apart from this, I found the Husband to be responsive, cooperative and made appropriate concessions.
The Property A property
The Court’s strong impression is that both the Husband and the Wife engaged in a dangerous game of brinkmanship about the Property A property. They both knew more than they let on about its potential value and the conditional offer received. They both acted in ways to seek to maximise their potential gain from this property. Whilst this is understandable from the human perspective, it was unhelpful to the Court, who had a statutory role to make a just and equitable order, not just for one of them but for both of them. Nonetheless, the Court is heartened that agreement was reached about the value of the Property A property at $1.2 million, but after the close of the evidence.
For completeness sake, the Court records that it accepts the evidence of Mr D, whose only interest in the matter appeared to be securing a sale which would ultimately benefit both the Husband and the Wife. He gave evidence in difficult circumstances by telephone with little notice and under time pressure. Nonetheless, his evidence was businesslike.
For the sake of completeness, and should it become relevant in some other context, I make findings about the conditional offer to purchase Property A. The difficulty in establishing the value of this property has already been noted. It is, nonetheless, important to make findings about the conditional offer to purchase. The evidence in this regard came from the Husband, the Wife and Mr D. I found Mr D to be the more credible and reliable witness in this regard. The Court makes the following findings.
The Wife had first contact with Mr D, not the Husband, but Mr D initiated this contact. The Wife indicated she wanted $1.6 or $1.7 million in order to sell the property. I accept Mr D’s evidence that the first contact with the Wife was sometime in November or December 2018, i.e. three months before his Affidavit. Mr D then contacted the Husband. I accept Mr D’s evidence that the Wife said that she was looking to sell the Property A property. Whatever Mr D’s client was willing to pay before 7 February 2019, the Court accepts that a conditional offer was made at $1.4 million, inclusive of GST and subject to conditions including a 15 month delayed settlement, a subject to finance provision and subject to site inspection and specialist inspection reports.
The Court accepts Mr D’s evidence that the purchaser is a well-off and reputable buyer. Before an agreement was made about the value of the property, the implications of this evidence would need to have been considered. It casts doubt on the Single Joint Expert valuation. But the conditional offer certainly does not enable the Court to say what the value of Property A actually is, given the conditional nature of the offer. The bona fides of the purchaser is reflected in the fact that a contract was sought and provided.
These findings also reflect poorly on the Wife who, firstly, owns the property. Secondly, she wants to retain the property. Thirdly, she failed to disclose to the Court matters which were clearly relevant to the decision the Court has to make. By the time of closing submissions, but the Court notes before an agreement was reached about the value of Property A, Counsel agreed that crystallising the value of the Property A property was an option for the Court and the Court notes this was not necessarily inconsistent with giving the Wife the opportunity to purchase and therefore retain the property.
The Balance Sheet
The Court must consider the balance sheet. My Associate will have sent out by email the final balance sheet, which represents the Court’s findings.
The joint balance sheet that was provided by Counsel at the Hearing becomes the Court’s Exhibit X and is reproduced in Schedule One. I will focus in these Reasons on the contentious issues and by reference to the item numbers in the document known as the joint balance sheet.
Item 2, I note, is now agreed at $1.2 million. There was a dispute about items 5, 5(a), 6 and 7. The Wife contended that the figures represented actual balances in the stated accounts. The Husband contends that the accounts in question all relate to the business operated by him, which is agreed at item 6(b) to either have a nil or a nominal value. The existence of a business valuation undertaken by the Wife became known during the course of the Hearing. Any such report was not tendered. The inference the Court draws is that the valuation is consistent with her contention that the business had a nil value. It must follow, therefore, that it would be potentially double dipping, or certainly unfair, to include these items on the balance sheet. Accordingly, items 5, 5A, 6 and 7 should all read nil.
Item 9 on the joint balance sheet was a Bendigo Bank account. The most recent evidence of the account balance is an account statement for the period 1 January 2019 to 31 January 2019 which puts the balance at $28,445.51. No submission was made to explain satisfactorily why the Court would not adopt the most current evidence it has about the value of this particular bank account. Item 9, therefore, will be $28,438.51.
There is an issue about item 10A, the Husband’s Motor Vehicle H. The Wife adduces no evidence to support the contended figure of $3550. The Court adopts $1200 as the Husband’s concession against interest.
There is an issue about 28, a boat and trailer, and item 18A. Both items are in the Husband’s possession. There is no evidence of value and no explanation for how the Wife estimates $10,000. In the circumstances, all the Court can do is to list all of these items at nil.
At item 30, the Husband seeks an add-back of the Wife’s legal fees paid, using pre-separation funds in the sum of $32,000. The Wife, in fact, conceded that the funds came from pre-separation savings. Counsel for the Wife submitted that the authorities, specifically NHC v RCH (2004) FLC 93-204, made it clear that the add-back is a matter for the Court’s discretion. Counsel submitted that the discretion should be exercised in the Wife’s favour not to add back the moneys so expended because the Husband had control of the business in the post-separation period and this led, for example, to him making substantial contributions to superannuation after separation. But the evidence does not permit even an inference to be drawn that there was somehow something inappropriate about how the Husband used income in the post-separation period, including possibly for superannuation. The Court cannot see the basis for doing what the Wife contends. The value of the business is on the balance sheet. Issues of non-disclosure pertaining to the Husband’s business income went nowhere in cross-examination and, as I have already observed, if there are issues of credit in financial matters except as regards Property A, those concerns are greater for the Wife than for the Husband. There is simply no basis for not adding back the legal fees paid out of joint funds.
Indeed the issue raised by the Husband is that the Wife, in fact, conceded in evidence that the legal fees paid were $53,000 which came from the term deposit savings that the Wife accessed at the date of separation. The Court accepts this and, thus, item 30 should read $53,000, but it follows that item 31 should read nil, a matter conceded by the Husband.
Item 32 was not pressed and, thus, will read nil.
Item 34 deals with liabilities of the Wife. These should not appear on the balance sheet, but are relevant under section 75(2).
Items 39 and 40 of the joint balance sheet were not pressed.
Accordingly, the Court finds that the balance sheet in this case to be in accordance with the document that it will make Court’s exhibit Y entitled ‘Final Balance Sheet – Court’s Findings’ which is incorporated in the Second Schedule to these Reasons.
Assessment of contribution
Let me turn to consider assessment of contribution. It’s important to recognise at the outset and record a number of important concessions and agreements that were made. Firstly, that the Wife was not pursuing her contributions argument insofar it was based on the Full Court’s decision in Kennon & Kennon [1997] FamCA 27.
Secondly, the Respondent Wife conceded that items 1 and 21 in the balance sheet should be “quarantined” – and I put that in inverted commas because that’s the terminology used by the parties – so “quarantined” with the further concession that she made no contribution to it. From the Court’s perspective this means creating a separate pool of assets, which contains items 1 and 21, and making a finding that the Respondent Wife has made no contribution to this separate pool. The Court recognises and accepts the appropriateness of the concession made, having regard to the evidence before it.
Thirdly that both the Applicant Husband and Respondent Wife conceded that but for one issue – that is, the weight, if any, to be given to the Husband’s contribution in bringing assets into the marriage – that a broad-based contribution finding of equality to the date of the trial should be made. The Court recognises and accepts the appropriateness of this concession, having regard to the evidence before it.
The focus then turns to the impact on assessment of contribution that the assets the Husband brought into the relationship and subsequent events. The Court accepts the Husband’s evidence that at cohabitation he had two pieces of real estate: Property J; and Property K. The latter property was unencumbered and was valued at the time at $110,000. The former property was purchased in March 1993 for $114,250 with a mortgage of $30,000, the rest from savings at a time when cohabitation was very recent. The Property J property was then sold and then about $93,000 from the sale proceeds was used to reduce what was then the mortgage over Property A.
Counsel for the Wife submitted that a number of matters result in a finding that contribution should continue to be assessed as equal notwithstanding the above. He pointed out that it was a long relationship. He submitted that the evidence demonstrated that both the Husband and the Wife worked on renovations to the properties. There is some substance to both of these points.
The Court does not accept, however, that the Wife’s contributions to the renovations were as great as she contends. The Court notes, in fact, that she benefited from rental received from the Property J property. Counsel for the Husband submitted that the initial contribution was significant and indeed should result in a finding overall of 60/40 in his favour. This of course produces a disparity of 20 per cent on the main pool of assets, which translates in dollar terms to about $652,000.
The Court assesses contribution in favour of the Husband at 55 per cent, taking into account all the matters raised. Having regard to the Full Court’s decision in Pierce and in Williams, and recognising the diversity of the Wife’s contribution since those initial contributions were made, the Court still considers an adjustment of five per cent in the Husband’s favour, productive of a 10 per cent differential, is a just and equitable outcome for the parties. Accordingly, in relation to the main asset pool, contribution is assessed at 55 per cent in favour of the Husband and 45 per cent in favour of the Wife. In relation to the quarantined asset pool it will be 100 per cent to the Husband.
Future needs
The Court must assess future needs, i.e. the matters referred to under section 79(4) and 75(2). The Wife sought an adjustment in her favour of 15 per cent. The Husband suggested no more than 5 per cent. The evidence indicates that both parties are in good health. The Wife is six years younger than the Husband. The Husband will emerge from these proceedings with both a superior income and earning capacity and a greater asset base as a result of, for example, the quarantining of assets and of the contribution findings.
The Wife may well have a capacity to earn more than she is, but the Court does not believe that it will ever be as great as that of the Husband, even though his working life may not be as long as hers. The Wife has responsibility to care for their youngest child, [X], who is 9. The Husband pays child support at $286.40 per week, which is no doubt a substantial assistance, but which would probably not cover the totality of [X]’s needs. Both the Husband and the Wife’s commitments are disclosed.
The Orders proposed will not affect their earning capacity. I do not accept that in this case there are issues of standard of pre-separation living to be considered here. As mentioned above, the Husband will emerge with a greater capital base than the Wife irrespective of what section 75(2) adjustment is made, but the Wife will certainly not be unable to reaccommodate herself. There are no other relevant issues to consider. When all of these matters are put in the balance, the Court assesses a section 75(2) adjustment in the Wife’s favour at 10 per cent, noting that this produces a differential of 20 per cent.
This will be applied to all of the assets, super and non-super within the main pool of assets only. It was not contended in the Husband or the Wife’s case that superannuation should be in a separate pool. The Wife sought that the parties’ respective superannuation be split equally. The Husband did not seem to contend otherwise.
Just and equitable Order
The Court must make a just and equitable order. Putting aside the quarantined asset pool where contribution is assessed 100 per cent to the Husband, the focus turns to the main asset pool. Contribution is assessed at 55 per cent in favour of the Husband, but s.75(2) factors favour the Wife at 10 per cent. This means the Wife receives 55 per cent, the Husband 45 per cent of the main pool. The Wife’s 55 per cent amounts to $1,795,337 rounded off. The Husband’s 45 per cent becomes $1,468,912 rounded off. The total net pool of assets is $3,264,249. Now, of course, part of the Wife’s share would be one-half of the total super. The total super is $519,446 and, thus, $259,723 will be the amount of superannuation that the Wife receives as part of her pool at $1,795,337.
As I mentioned earlier in the Reasons, in the unusual circumstances of this case, it is appropriate to direct the parties to submit an agreed minute of order reflecting my reasons within 21 days because it could take a few days to get the judgment out. If they cannot submit an agreed minute, then the Wife must within 28 days, and the Husband within 35 days, submit a minute of the orders that they propose and the matter will then be relisted before me.
I certify that the preceding fifty-one (51) paragraphs are a true copy of the reasons for judgment of Judge Altobelli
Date: 28 February 2019
Schedule One
| Joint Balance Sheet | Name | Gleason & Gleason | |
| File No | |||
| Note: this document can be sent by electronic means between the parties prior to it being filed at court. | Date | 7/2/2018 | Time 10.00am |
| Before | Judge Altobelli | ||
| Ownership | Description | Wife / de facto partner’s value | Husband / de facto partner’s value | |
| ASSETS | ||||
| 1. | J | Property L (valuation) | $ 1,040,000 | $ 1,040,000 |
| 2. | J | Property A (valuation) | $ 950,000 | $ 1,500,000 |
| 3. | J | Property M (valuation) | $ 1,100,000 | $ 1,100,000 |
| 4. | J | Cash Management Account … | $ Nominal | $ Nominal |
| 5. | H | Credit Union account – Mr Gleason & Ms Gleason t/a Company G *(as at 16/1/2019 – statement) | $ 83 | $ see below items 6 and 6A |
| 5A | H | Credit Union account – Mr Gleason t/a Company G *(as at 16/1/2019 – statement) | $ 11,241 | $ see below items 6 and 6A |
| 6. | H | Credit Union Account – Mr Gleason *(as at 16/1/2019 – statement) | $ 3,579 | $1992.79 |
| 6A | H | Credit Union Business Bank Accounts ($7242.26) and ($0) | $ See Items 5, 5A and 6 | $ See below Company G |
| 6B | H | Company G business – sole trader | $ NIL | $ Nominal value |
| 7. | H | Credit Union (Member No …) *(now accounts disclosed at Items 5, 5A and 6) | $ NIL | $ NIL |
| 8. | H | Credit Union | $ 97,445 | $ 97,445.43 |
| 9. | H | Bendigo Bank #... | $ 49,895 | $ 28,438.51 |
| 10. | W | Bank Term Deposit Account ending #... | $ 30,701 | $ NK |
| 11. | W | Bank Access Account ending #... | $ 1,835 | $ NK |
| 12. | W | Bendigo Bank Account ending #... | $ 6,000 | $ NK |
| 13. | W | Bendigo Bank Account ending #... | $ 30,400 | $ NK |
| 14. | W | Bendigo Bank Account ending #... | $ 16,000 | $ NK |
| 15. | W | Bendigo Bank Account ending #... | $ 165 | $ NK |
| 16. | W | Bendigo Bank Account ending #... | $ 83 | $ NK |
| 17. | W | Bendigo Bank Account ending #... | $ 25 | $ NK |
| 18. | W | Saver Account ending #... | $ 85 | $ NK |
| 19. | W | Bendigo Bank Account ending #... (in trust for [X]) | $ 1,303 | $ NK |
| 20. | H | Shares N 4372 shares @ $23.95 | $ 104,710 | $ 104,710 |
| 21. | H | Shares Q (2,000 @ $1.50 per share) | $ 3,000 | $ 3,000 |
| 22. | W | Shares O (1000 @ $5.34) | $ 5,340 | $ 5,350 |
| 23. | W | Motor Vehicle P | $ 13,000 | $ 13,000 |
| 10A | H | Motor Vehicle H motor vehicle | $ 3,550 | $ 1,200 |
| 24. | H | Motor bike | $ 1,000 | $ 1,000 |
| 25. | H | Motor Vehicle R | $ 6,550 | $ 5,400 |
| 13A | H | Motor Vehicle S | $ 2,600 | $ 2,600 |
| 26. | W | Furniture | $ NIL | $ NIL |
| 27. | H | Furniture | $ NIL | $ NIL |
| 28. | H | Rowing boat / sailing boat and camper trailer | $ 10,000 | $ NIL |
| 18A | H | Jet ski | $ 1,500 | $ NIL |
| 18B | H | Hobby equipment | $ NIL | $ NIL |
| 29. | W | Funds paid for by Husband for Wife’s share of previous family law valuation | $ 500 | $ 500 |
| 30. | W | Legal fees paid by Wife using pre-separation funds | $ NIL | $ 32,000 |
| 32A | W | Funds held in trust | $ 19,572 | $ 19,572 |
| 32B | H | Funds held in trust | $ 24,750 | $ 24,750 |
| 32C | H | Shares account - closed | $ NIL | $ Nil |
| Total | $ | $ E |
| ADDBACKS | ||||
| 31. | W | Withdrew funds from term deposit savings account following separation and not otherwise accounted for | $ NIL | $ 70,000 |
| 32. | H | Reimbursement of funds withdrawn from joint accounts | $ 58,500 | $ Nil |
| 33. | ||||
| Total | $ 58,500 | $ |
| LIABILITIES | ||||
| 34. | H | Legal fees owing to date | $ | $ E21,000 |
| 35. | $ | $ | ||
| Total | $ 0 | $ 0 |
| SUPERANNUATION | |||||
| Member | Name of Fund | Type of Interest | Wife / de facto partner’s value | Husband / de facto partner’s value | |
| 36. | W | Super Fund T *(snapshot 5/2/2019) | accumulated | $ 13,306 | $ NK |
| 37. | H | Super Fund T *(printout 23/1/2019) | accumulated | $ 506,140 | $ 502,405 |
| 38. | $ | $ | |||
| Total | $ 519,446 | $ 513,181 |
| FINANCIAL RESOURCES | ||||
| Ownership | Description | Wife / de facto partner’s value | Husband / de facto partner’s value | |
| 39. | W | Potential Car Park Rental $100.00 per month for 9 car parking spaces | $ 0 | $ 10,800 |
| 40. | W | Market rental income for commercial letting of Property A inclusive of 9 car spaces | $ 0 | $ 42,987 |
| Total | $ 0 | $ |
Schedule Two
| FINAL Balance Sheet (Court’s findings) | Name | Gleason & Gleason | |
| File No | |||
| Date | 7/2/2018 | Time 10.00am | |
| Before | Judge Altobelli | ||
| Ownership | Description | |||||||
| ASSETS | ||||||||
| 1. | J | Property L (valuation) | $ 1,040,000 | |||||
| 2. | W | Property A (valuation) | $ 1,200,000 | |||||
| 3. | J | Property M (valuation) | $ 1,100,000 | |||||
| 4. | J | Cash Management Account #... | $ Nominal | |||||
| 5. | H | Credit Union account – Mr Gleason & Ms Gleason t/a Company G (Member No …) *(as at 16/1/2019 – statement) | $ NIL | |||||
| 5A | H | Credit Union account – Mr Gleason t/a Company G (Member No 97335 - S1.1) *(as at 16/1/2019 – statement) | $ NIL | |||||
| 6. | H | Credit Union Account– Mr Gleason *(as at 16/1/2019 – statement) | $ NIL | |||||
| 6A | H | Business Bank Accounts ($7242.26) and S55 ($0) | $ See Items 5, 5A and 6 | |||||
| 6B | H | Company G business – sole trader | $ NIL | |||||
| 7. | H | Credit Union (Member No …) *(now accounts disclosed at Items 5, 5A and 6) | $ NIL | |||||
| 8. | H | Credit Union (Deeming for …) | $ 97,445 | |||||
| 9. | H | Bendigo Bank #... | $ 28,438.51 | |||||
| 10. | W | Bank Term Deposit Account ending #... | $ 30,701 | |||||
| 11. | W | Bank Account ending #... | $ 1,835 | |||||
| 12. | W | Bendigo Bank Account ending #... | $ 6,000 | |||||
| 13. | W | Bendigo Bank Account ending #... | $ 30,400 | |||||
| 14. | W | Bendigo Bank Account ending #... | $ 16,000 | |||||
| 15. | W | Bendigo Bank Account ending #... | $ 165 | |||||
| 16. | W | Bendigo Bank Account ending #... | $ 83 | |||||
17. | W | Bendigo Bank Account ending #... | $ 25 | |||||
| 18. | W | Credit Union Access Saver Account ending #... | $ 85 | |||||
| 19. | W | Bendigo Bank Account ending #...(in trust for [X]) | $ 1,303 | |||||
| 20. | H | Shares N 4372 shares @ $23.95 | $ 104,710 | |||||
| 21. | H | Shares Q (2,000 @ $1.50 per share) | $ 3,000 | |||||
| 22. | W | Shares O (1000 @ $5.34) | $ 5,340 | |||||
| 23. | W | Motor vehicle P | $ 13,000 | |||||
| 10A | H | Motor vehicle H | $ 1300 | |||||
| 24. | H | Motor bike | $ 1,000 | |||||
| 25. | H | Motor vehicle R | $ 6,550 | |||||
| 13A | H | Motor vehicle S | $ 2,600 | |||||
| 26. | W | Furniture | $ NIL | |||||
| 27. | H | Furniture | $ NIL | |||||
| 28. | H | Rowing boat / sailing boat and camper trailer | $ NIL | |||||
| 18A | H | Jet ski | $ NIL | |||||
| 18B | H | Hobby equipment | $ NIL | |||||
| 29. | W | Funds paid for by Husband for Wife’s share of previous family law valuation | $ 500 | |||||
| 30. | W | Legal fees paid by Wife using pre-separation funds | $ 53,000 | |||||
| 32A | W | Funds held in trust | $ 19,572 | |||||
| 32B | H | Funds held in trust | $ 24,750 | |||||
| 32C | H | Shares account - closed | $ NIL | |||||
| Total | $ 3,787,802.51 |
| ADDBACKS | ||||
| 31. | W | Withdrew funds from term deposit savings account following separation and not otherwise accounted for | $ NIL | |
| 32. | H | Reimbursement of funds withdrawn from joint accounts (not pressed) | $ NIL | |
| 33. | ||||
| Total | $ 0 | $ |
| LIABILITIES | ||||
| 34. | H | Legal fees owing to date | $ NIL | |
| 35. | $ | |||
| Total | $ 0 | $ 0 |
| SUPERANNUATION | |||||
| Member | Name of Fund | Type of Interest | |||
| 36. | W | Super Fund T *(snapshot 5/2/2019) | accumulated | $ 13,306 | |
| 37. | H | Super Fund T *(printout 23/1/2019) | accumulated | $ 506,140 | |
| 38. | $ | ||||
| Total | $ 519,446 |
| FINANCIAL RESOURCES | ||||
| Ownership | Description | |||
| 39. | W | Potential Car Park Rental $100.00 per month for 9 car parking spaces | $ 0 | |
| 40. | W | Market rental income for commercial letting of Property A inclusive of 9 car spaces | $ 0 | |
| Total | $ 0 |
| Net non-superannuation assets | $3,787, 802.50 |
| Superannuation assets | $519,446.00 |
| Total Assets | $4,307,248.85 |
| POOL NUMBER 1 (“QUARANTINED” ASSETS) | |
| 1. Property K | $1,040,000 |
| 21. Shares Q | $3000 |
| Total | $1,043,000 |
| POOL NUMBER 2 (REMAINING ASSETS) | $3,264,248.80 |
| Total assets | $4,307,248.85 |
Key Legal Topics
Areas of Law
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Family Law
Legal Concepts
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Appeal
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Damages
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Remedies
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