GRANATH and GRANAT

[2014] FCWA 49

JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA

ACT: FAMILY LAW ACT 1975

LOCATION: PERTH

CITATION: GRANATH and GRANAT [2014] FCWA 49

CORAM: CRISFORD J

HEARD: 7 & 8 AUGUST 2014

DELIVERED : 28 AUGUST 2014

FILE NO/S: PTW 2454 of 2007

BETWEEN: MRS GRANATH (by her Case Guardian - The Public Trustee)

Applicant

AND

MR GRANAT
Respondent

Catchwords:

PROPERTY SETTLEMENT – Where it is just and equitable to alter the parties’ rights and interests in their property – where both parties are in their late seventies – where the parties separated in 1990 and divorced in 2007 – where the respondent received an inheritance in 2011 – where the wife has high care requirements and has Alzheimer’s disease – where both parties’ contributions to property acquired during the marriage are equal – where both parties’ needs are similar – where the court found the wife had not contributed to the inheritance – where the parties’ matrimonial property and cash funds (including superannuation) were divided equally.

Legislation:

Family Law Act 1975 (Cth) - s 75, s 79

Category: Not Reportable

Representation:

Counsel:

Applicant: Ms G Anderson

Respondent: Self Represented Litigant

Solicitors:

Applicant: Calverley Johnston

Respondent: Self Represented Litigant

Case(s) referred to in judgment(s):

Stanford v Stanford (2012) 247 CLR 108

WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL
JUDGMENT - PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN
CHANGED

1Stanford v Stanford (2012) 247 CLR 108, in which the High Court pronounced judgment and delivered reasons on 15 November 2012, heralded the arrival of a greater number of cases grappling with the division of matrimonial property after the breakdown of relationships in an aging population.

2[Mr Granat] and [Mrs Granath] are each faced with the need to secure appropriate accommodation to suit their respective needs as they age.

Background

3Mrs Granath, the wife, now aged 78 years, and Mr Granat, the respondent, now aged 76 years, were married [in] 1961 in [Country S].

4They have two children, [L] born [in] 1965 and now aged 49 and [F] born [in] 1966 and now aged 48.

5The parties and the children migrated from Country S to Western Australia in 1971.

6[In] August 1983 they acquired the former matrimonial home [Property A] (“the property”). This remains the home in which the respondent lives.

7The parties separated in about 1990. The respondent left the property whilst the wife remained living there. Shortly after separation the wife went to [Country F] to work for a period of between 12 to 18 months. During that period of time the home was rented.

8A divorce order was granted on 21 June 2007. On 24 January 2008 the respondent commenced proceedings in the Family Court for the sale of the property. About a month later, on 26 February 2008, those proceedings were adjourned generally. The respondent agreed the wife could remain in the property at that time.

9In October 2010 the wife was admitted to Graylands Hospital via the Older Mental Health Ward of the Armadale Hospital. She was diagnosed with Alzheimer’s disease. She returned to live in the property in November 2010 due to the lack of an immediate permanent placement for her in an aged care facility.

10On 21 December 2010 the State Administrative Tribunal made an order appointing the Public Trustee as the wife’s plenary administrator. The Public Trustee is the applicant in these proceedings.

11On 27 December 2010 the wife was assessed by an aged care assessment team as low care. She was admitted to the Older Mental Health Ward of the Armadale Hospital.

12In early 2011 the wife was assessed by Centrelink as being entitled to permanent residential aged care. An assessment was carried out based on her half share in the former matrimonial home. She is required to pay a residential bond to the aged care facility of $129,578.

13In April 2011 the respondent returned to the property and he continues to reside there. Prior to moving back into the property he rented a flat in [Property B].

14In August 2011 the wife received a permanent placement at the [Starlight] Aged Care Facility (“Starlight”). She remains resident at that facility.

15On 30 November 2011 the wife was assessed by an aged care assessment team as high care.

16Sometime in 2011 the respondent’s mother passed away and he received an inheritance of a half share in her estate.

Orders sought at trial

17The Public Trustee is seeking that the property be sold. It seeks to conduct the sale of the property. It is willing to confer with the respondent as to the listing and sale price.

18In order to properly present the property for sale, it seeks orders for the respondent to vacate the property, leaving it clean and tidy. It wants the respondent to ensure he returns all keys and alarm codes and that he does everything to present the property in a good state of repair.

19The Public Trustee seeks that upon settlement of the sale of the property the costs of sale be paid and that the balance of the parties’ property be divided equally between the parties.

20The respondent opposes any sale of the property. He accepts that the wife requires money to ensure she can remain in Starlight. However, he proposes he makes the payments himself and thus preserves the property for his own use and occupation. He says he would like to have that option and remain living there as he has done for the past three years.

21The respondent says that he has made a greater post-separation contribution than the wife to their assets. Whilst he generally accepts a 50 per cent division is appropriate, he says that some of his post-separation contributions need to be taken into account and credited to him.

Applicable Law

22The High Court has reviewed the principles applicable to the determination of property settlements under the Family Law Act 1975 (Cth) (“the Act”) in Stanford (supra).

23The preliminary question which must be answered is whether it is just and equitable to make any orders altering the parties’ rights and interest in their property. If the answer to that question is yes, then it is necessary to consider the manner in, and the extent to, which it should be done.

24Next there is a need to identify the nature of the parties’ interests in their property, liabilities and financial resources at the time of the hearing. An evaluation of their respective contributions as set out in s 79(4)(a), (b) and (c) must be undertaken.

25The matters contained in s 75(2) insofar as they are relevant must then be evaluated. The final exercise is whether the outcome resulting from the orders to be made is just and equitable.

Balance sheet

26The property of the parties was not in dispute, although there was some discussion about the treatment of the respondent’s Country S bank account.

Property - description	Ownership	Value ($)
[Property A] (value at 7 February 2014)	Joint	360,000
Public Trustee Common Fund	Applicant	4,544
Shares in [K] Ltd	Applicant	475
Commonwealth Bank Account	Respondent	410
BankWest Savings Account	Respondent	6,150
BankWest Term Deposit	Respondent	7,000
BankWest Cheque Account	Respondent	2,273
Total Property	$380,852
Superannuation
First Choice Employer Superannuation	Respondent	777
BT Business Super	Respondent	1,000
Total Superannuation	$1,777
Total Net	$382,629

Inheritance 2011	Amount ($)
[Country S] account	Respondent	25,425

27The applicant has a number of liabilities:

Liabilities	Amount ($)
Outstanding Accommodation Bond	Applicant	129,578
Outstanding Interest on Accommodation Bond	Applicant	34,410
Public Trustee’s Legal Fees (excluding GST)	Applicant	3,480
Calverley Johnston’s Billed Fees (including GST)	Applicant	16,302
Counsel’s Unbilled Fees (excluding GST)	Applicant	15,000
Legal Aid Memorial	Applicant	1,563
Total liabilities	$200,333

28On the basis the accommodation bond is paid retention fees, presently owing of $10,762, are not required to be paid.

29The Respondent does not have any debts apart from ongoing expenses associated with upkeep of the property. He anticipates that he may have some tax to pay in the future but there was no detail about this at all.

Is it just and equitable to make orders altering property interests here?

30The marriage between these parties was of long duration. When the respondent initially commenced proceedings on 24 January 2008 he sought a 50 per cent share of the property. This anticipated its sale. The matter did not proceed to finalisation at that stage because the wife wanted to remain in the property and the respondent agreed.

31The position between the parties is now completely different. The wife is accommodated, due to mental health and aging issues, elsewhere. It is not free. She must pay an accommodation bond. The bond has not been paid and outstanding interest has accumulated on the unpaid amount. If the bond is not paid, retention fees become payable.

32The respondent also needs accommodation. At his age it is much easier for him to simply remain where he is in the property he acquired jointly with the wife. He says he will have difficulty finding alternate appropriate accommodation.

33The Public Trustee had instituted proceedings in the Supreme Court to realise the wife’s half share in the property given the parties were divorced. Understandably, that course was unsuccessful. The need to resolve the property entitlements of these parties and their impasse in negotiations make the present action appropriate. Without it the wife will not be able to access the money to which she is entitled.

34It is just and equitable to make orders dividing the parties’ property.

Contributions

35I will now turn to the respective contributions each party made to the property. The wife’s case was conducted through the applicant. The respondent represented himself. The evidence was less than fulsome.

36It is agreed that the contributions of the parties up until the date of separation in or about September 1990 are equal. After the parties separated the respondent left the property and the wife and children remained living there.

37I accept that the respondent continued to pay the mortgage which was then registered over the property and continued to make those payments for about seven years. At separation the mortgage was approximately $20,000.

38I accept the respondent’s evidence that he made other payments towards outgoings on the property from time to time. The wife also made payments for utilities and outgoings. She lived there and the impost of repairs and maintenance fell to her.

39There were one or two periods of time when the property was rented to others and the wife retained any payments made during those periods.

40The respondent has resided in the property for the last three to four years.

41The land area of the property is 979 square metres. It is zoned for a single residence despite its larger than average area. The property is described by the Single Expert valuer, Scott Grundmann, as being of below average street appeal and near original standard inside. The chattels are of a reasonable presentation and it is in a fair state of repair for its age.

42There is a paucity of information about the manner in which each party has contributed to the property since separation, but on the limited information I have I am satisfied that contributions to the property are likely overall to have been equal.

43The only other item to which contribution is an issue is that of the respondent’s inheritance from his mother’s estate received sometime in 2011.

44I accept that the respondent has failed to make a full and frank disclosure of all documents relating to his mother’s estate. This includes a complete set of bank accounts into which the proceeds of the inheritance were deposited and thereafter utilised by the respondent.

45The respondent’s evidence is that he received approximately $100,000. The applicant suggests there was more. The respondent says he has $25,000 left in a bank account. He said that there was tax payable on the original amount and there were also legal fees relating to the administration of the estate. There had been disagreement between himself and his brother over the estate. The Court is unsure about the gross amount the respondent received and what necessary payments were deducted from such gross amount.

46The respondent said he had paid approximately $7,000 on a new set of hearing aids and that from time to time he had provided the parties’ daughter, who is a single mother, with sums of around $1,000 each month. His present relationship with his children is poor. He has been close to L in the past and continues to assist her financially. He also said that recently he had withdrawn $1,000 in order to pay some upcoming bills.

47The applicant’s position is that given the respondent’s failure to disclose, it is likely there was a greater sum received by way of the inheritance and there may be money that is not properly accounted for.

48I am not satisfied on the balance of probabilities that this is the case. Whilst a failure to disclose allows the Court to adopt a robust approach to the drawing of adverse inferences, I am not persuaded I should do so here. I take into account not only the difficulties in language clearly experienced by the respondent, but the difficulty he has as a self-represented litigant in understanding the need to disclose documents for an asset he received from his deceased mother in 2011. The parties had separated in 1990 and divorced in 2007.

49The respondent is desperate to remain living in the property. To this end he has offered to pay the ongoing interest on the accommodation bond. This obviates the need to pay the whole lump sum amount. On this basis, however, retention fees would need to be paid. Whilst the respondent had factored in the payment of ongoing interest at nine per cent per annum or $31.95 per day, he had not realised that money was already owing for outstanding interest and the retention fees. In addition daily care fees of $45.63 are to be paid. The retention fees are $318 per month. When the Court drew his attention to this, rather than offering to “borrow” money from some fund overseas and thus suggesting other available funds, he simply said that he would take on more work.

50The respondent had canvassed various possibilities and said he would take on work as a trolley boy at $20 an hour or return to his old occupation of [bus driver]. The respondent’s work ethic at age 76 is laudable. He presently works for one day each week and earns $195. He receives two modest pensions. His total weekly income is $732. With the best will in the world it is clear to the Court and possibly, to the respondent, that he would not have the ability throughout the coming years to pay any currently outstanding money and the ongoing nine per cent interest. There are also daily care and retention fees. He would not have the ability to earn an income to support such outgoings and also live appropriately.

51I am not satisfied that there is a cache of money in an undisclosed account either in Australia or overseas.

52Given:

·the timing of the receipt of the inheritance;

·the relationship of the parties at that time; and

·no evidence that the wife made an indirect contribution to the inheritance

I intend to adopt an asset by asset approach and to quarantine that amount from the parties’ property acquired during their marriage. I intend to take it into account as the respondent’s sole property. I will consider it further in the primarily prospective factors of s 75(2) of the Act.

53The balance of the respondent’s bank accounts will be included in the balance sheet. The Public Trustee has agreed to the respondent retaining motor vehicles and various chattels in his possession. All are of modest value only.

54I find it appropriate based on contributions to divide the parties’ matrimonial property equally. I will leave the respondent’s inheritance with him. I do not consider the wife has contributed to it.

Section 75(2) factors

55Both parties are in their late seventies. The wife has high care requirements and has Alzheimer’s disease. The respondent presents as fit for his age, but has a desire and need for security and stability in his living arrangements.

56The wife resides in Starlight. Her half share of the property was taken into account when assessing the accommodation bond she needed to pay. She now has substantial liabilities resulting from these proceedings and the failure to pay the accommodation bond at that time of assessment. The applicant said that the assessment of the amount of her bond could be varied if the wife’s financial circumstances warrant it.

57I do not have before me any evidence of the amount by which the accommodation bond could change if the wife’s financial circumstances were less than at the time of the original assessment. However, I understood that it may be possible to reduce the amount owing and still make available to the wife a sum of money to pay her ongoing living expenses, over and above the Centrelink benefit she receives. The wife may also be entitled to a pension from Country F which would increase her overall income.

58It is not viable for the respondent to take over the wife’s accommodation expenses to allow him to remain in the property. I say this given his own financial circumstances. This scenario means he will have to find different accommodation. At best, any amount he receives may allow him to purchase very modest accommodation of his own. There was no evidence as to how, practically and financially, this would be accomplished. If it is not possible or of any appeal to him, then he faces finding rental accommodation, as he did some three to four years ago. The respondent is upset about this and questions his ability to access appropriate rental accommodation.

59At the present the respondent does not complain of any physical or mental difficulties. He works one day each week as a cleaner in a [shop].

60I am unable to discern any difference in the future needs of the parties based on the evidence presented to me. Their needs are similar. They require accommodation. The wife may have the ability to reduce her bond if her needs dictate this. The respondent will need ready money to find appropriate accommodation for the balance of his life, including aged care if appropriate in the future.

61There is an unhappy tension here.

Just and equitable

62The parties’ cash funds, including the superannuation, but without taking into account the bank account in Country S, is $22,629. Over and above this is the likely proceeds of sale of the former matrimonial home. Given my intention to divide all property, save for the inheritance, equally, the wife will receive immediately available cash of $11,314.50. The respondent will retain a like amount and the balance of the bank account in Country S.

63The wife currently has the value of her shares ($475) and money in the Public Trustee Common Fund ($4,544).

64I consider it appropriate that the respondent make an immediate cash payment to the wife of $6,295.50 which can be taken from any source he chooses, but is to be given to her in a lump sum. He will retain the balance of his accounts and his superannuation.

65The net proceeds of sale of the property will be divided equally. That amount will be determined after sale.

66In considering the proceeds of sale of the property it is necessary to also appreciate why the order for sale is, in this Court’s view, just and equitable.

67Each of the parties has a very different view about the use to which the former matrimonial home should be put. For her part, the wife relies upon an agreement she says was reached with the respondent after separation in 1990 to the effect she could retain all the property.

68On separation the respondent left the wife living in the property. He rented accommodation elsewhere. Even after he commenced proceedings for the sale of the property he agreed to allow the wife to remain living there. There were negotiations and she did not want to leave and rent accommodation. The respondent did not then pursue his application for its sale.

69The respondent has provided some correspondence from his solicitors at the time to show that he was willing to allow the wife to remain in the property until she died or moved into a nursing home. He deposes that if she re-married, then she would also have to move.

70He now says it was not his intention that if any of those possibilities eventuated, the property would then be sold. It simply meant he would then take it over himself. He deposes that the wife lived there for 21 years after separation and he now wants his 21 years. This position fails to take into account the wife’s contributions or present needs given she is in a nursing home and it is not free.

71I see no realistic or practical option other than this property be sold. The wife needs to have her accommodation needs met as does the respondent. The respondent has a greater range of options currently available to him, although these are unpalatable and difficult for him.

72I consider it appropriate that the respondent be given a period of time within which to make his arrangements for other accommodation, tidy the home and co-operate with the marketing of the property. However, he should be able to remain there, if he chooses, until sale on the basis that the Public Trustee can take appropriate steps to market it in a timely manner. The Public Trustee is willing to have discussions with the respondent about the listing and the price.

73The respondent has had some contact with [a real estate agent] and I consider it appropriate for the Public Trustee to liaise with this agency if, indeed, the respondent has already canvassed their views.

74Once the property has been sold then the mortgages already paid out need to be actually discharged utilising the joint proceeds of sale.

75I find the applicant should be responsible for the discharge of the Memorial to Legal Aid WA from the wife’s funds.

76I consider this outcome, distressing as it may be to the respondent, to reflect what is just and equitable. It is a practical reality of their situation.

Orders

1Within 21 days of the date of these orders, the respondent, [MR GRANAT], pay to the applicant, the Public Trustee as Case Guardian for [MRS GRANATH], $6,295.50.

2The former matrimonial home [Property A] (“the former matrimonial home”), be placed on the market for sale not earlier than two months from the date hereof and that:

(a)the Public Trustee as Case Guardian for the Applicant (“the Public Trustee”) conduct the sale of the former matrimonial home provided that the Public Trustee shall confer with the Respondent or his agent as to listing price and sale price with liberty to the parties to apply on urgent notice;

(b)the Public Trustee appoint an agent licensed under the Real Estate and Business Agents Act 1978 (WA) to act on behalf of the parties in respect of the sale of the former matrimonial home;

(c)prior to the former matrimonial home being placed on the market for sale, the respondent shall forthwith clean and tidy the property in preparation for it being placed on the market for sale;

(d)upon the former matrimonial home being placed on the market for sale, the respondent shall:

(i)make the former matrimonial home available for inspection by prospective purchasers at all reasonable times and/or upon receiving reasonable notice from the agent(s);

(ii)make door keys, garage door keys or remotes; alarm codes to the former matrimonial home available to the agent(s) to enable access to the interior and/or rear thereof; and

(iii)keep the former matrimonial home clean, tidy and in a good state of repair.

(e)upon settlement of the sale of the former matrimonial home, the proceeds of sale be applied in the following manner:

(i)in payment of reasonable costs, charges and expenses associated with the sale including agent’s commission and conveyancing costs;

(ii) in discharge of the:

(a)mortgage in favour of the [Westpac Bank], being mortgage number [1];

(b)mortgage in favour of the [Westpac Bank], being mortgage number [2]; and

(c)mortgage in favour of the [Westpac Bank], being mortgage number [3]; and

(iii) in adjustment of outstanding rates and taxes;

(iv)subject to (v) below, in discharge of the memorial secured against title of the former matrimonial home in favour of Legal Aid WA; and

(v)the balance be divided equally between the applicant and the respondent taking into account the payment in (iv) hereof which is to be from the applicant’s share only.

3Pending settlement of the sale of the former matrimonial home the parties be restrained by injunction from encumbering, or further encumbering, title of the former matrimonial home, or withdrawing any sums of money from any loan account, line of credit or similar secured by mortgage against title of the former matrimonial home.

4Liberty be granted to the parties to apply on reasonable notice for any consequential orders necessary to implement these orders.

5Each party is to retain the furniture, chattels, superannuation and other personal items currently in the possession or control of each of them.

6Subject to paragraph 1 hereof, any interest the applicant may have in the [Country S] account vest in the respondent absolutely.

7The application initiating proceedings filed 24 January 2008 by the respondent be dismissed.

8The amended application initiating proceedings filed 17 January 2013 by the applicant be dismissed.

I certify that the preceding [76] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court

Associate