Grattan and Grattan

FAMILY COURT OF AUSTRALIA

GRATTAN & GRATTAN

[2012] FamCA 1090

FAMILY LAW – PROPERTY – Settlement in relation to marriage – where one party claims that the other party has failed to disclose details of overseas assets – where one party has companies in liquidation.
FAMILY LAW – CHILD SUPPORT – whether funds garnished from the husband and held by the Child Support Agency should be released to the wife – whether a stay on the husband’s child support assessment should be lifted.

Family Law Act 1975 (Cth)

APPLICANT:

Mr Grattan

RESPONDENT:

Ms Grattan

FILE NUMBER:

SYC

5708

2009

DATE DELIVERED:

12 December 2012

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Justice Fowler

HEARING DATE:

15-16 March 2012 and 23 August 2012

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Levet

SOLICITOR FOR THE APPLICANT:

Avondale Lawyers

COUNSEL FOR THE RESPONDENT:

Ms Picker

SOLICITOR FOR THE RESPONDENT:

John de Mestre & Co.

Orders

Within 42 days of the date of these Orders the husband shall sign all documents and do all acts and things necessary to transfer to the wife all his right, title and interest in the property known as M Street, P in the State of New South Wales (the “P property”) and simultaneously with that transfer:
(a)the wife shall assume the whole of the mortgage liability to Westpac Bank charged over the P property and indemnify the husband accordingly and simultaneously
(b) the husband shall pay to the wife the sum of $70,870.
If the husband receives any benefit from the liquidation of the European companies G Pty Ltd, B Pty Ltd and E Business he is to notify the wife of that event and disclose the sum received by him within 48 hours of its receipt.
The wife is entitled to all the household contents at the P property and the husband is entitled to all the household contents at the property known as D Street, D in the State of New South Wales (the “D property”).
The husband is declared as against the wife the beneficial owner of the following artwork:
(a) Artwork 1 and
(b) Artwork 2
The wife is declared as against the husband the owner of:
(a) her diamond ring and
(b) her X brand Watch.
Other than as herein provided the husband and the wife each be declared the owner at law and in equity of all property including but not limited to money, household items and personal effects in their respective possession and control.
Other than as herein provided the husband and the wife each are declared the owner of such superannuation entitlements and pension benefits to which each of them is or might become entitled in his or her own right.
Other than as herein provided the husband and the wife each remain liable for any debts in his or her sole name at the date of the Orders and in this respect shall indemnify and hold harmless the other from any liability in relation thereto.
Order 2 made by Justice Le Poer Trench on 17 May 2011 is to be discharged such that the garnished funds in the sum of $8,573.19 held by the Child Support Agency are to be released to the wife.
With respect to the Orders made by Justice Le Poer Trench on 17 May 2011 which placed a stay on the collection and enforcement of the child support payable by the husband:
(a)the stay is to continue in place from the date and time that it was made until the date and time of the Orders herein
(b)the stay is to be dissolved from the date and time of the Orders herein
(c)the child support otherwise accruing under the assessment to the date and time of the lifting of the stay be deemed to have been paid and
(d)any future assessment for child support is to be assessed from the date of the lifting of the stay.
In the event that the husband or the wife refuses, fails or neglects to comply with any of the Orders herein requiring a party to execute a deed or instrument, a Registrar of this Court at its Sydney Registry is appointed pursuant to section 106A of the Act to execute in the name of the husband or wife as the case may be, any deed or instrument necessary to give effect to the Orders herein, or any of them, and to do all acts and things necessary to give validity and operation to the said deed or instrument.

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 5708 of 2009

Mr Grattan

Applicant

And

Ms Grattan

Respondent

REASONS FOR JUDGMENT

Introduction

Before the Court are proceedings between the parties to a marriage seeking an alteration of their property interests and certain orders in relation to child support.
The parties were married for approximately eight years and eight months.
The parties have two children: R Grattan (“R”), currently aged 11 years; and W Grattan (“W”), currently aged 7 years.
According to a parenting plan agreed to by the parties, the children spend time with the husband each alternate weekend from Thursday evening to Monday morning before school, and otherwise live with the mother.

Background Facts

Where in this judgment I make statements of fact they are, unless otherwise specified, my findings of fact.
In 1965 the wife was born. She is currently 47 years of age.
In 1968 the husband was born. He is currently 44 years of age.
In December 1992 the husband completed a business degree at university.
From 1992 to 1995 the husband was employed by his father (“Mr Grattan Senior”) and resided in southeast Asia.
In mid-1995 the husband resigned from his father’s company due to a difference with his stepmother, Mrs Grattan Senior.
In May 1996 the husband deposes that he was told of his father’s intention to leave him $500,000 and a property at D Street, D (“the D property”). The wife asserts that this occurred in 1997.
In September 1996 the husband received $500,000 from his father.
In 1997 the wife purchased a property at V Street, N (“the N property”) for $230,000 as an investment.
In May 1997 the husband commenced residing in the D property.
In 1997 the husband deposes that he co-founded the company MS Pty Ltd and that the business commenced trading from his D home.
In 1998 the husband’s mother gifted him an Australian painting for his 30^th birthday.
In December 1998 the parties met.
In January 1999 the parties commenced a relationship.
In late 1999 the wife asserts that the husband told her that Mr and Mrs Grattan Senior decided to give them the D townhouse as a wedding gift. The husband denies this.
After considering the evidence of Mrs Grattan Senior together with the evidence of the husband, which on this issue is preferred to that of the wife, the Court accepts the husband’s denial as being correct. The property was gifted to the husband.
It was noted that, when considering the gift, the donors had discussed that it would be for the use of the husband and any wife of his, but not that it would be the property of the husband and any wife of his. It seems clear that there was a similar gift of a similar apartment to the other child of the blended family. The gift of the townhouse was announced to the husband by the donors prior to his marriage to the wife in January 2000.
In January 2000 the parties married and commenced cohabitation at the D property. The wife asserts that her father, Mr Y, paid $100,000 for the cost of the wedding.
In 2000 the husband’s father advised his solicitor, Mr S, that he was providing for his two children and his stepchild Ms T $500,000 each and a house.
In 2000 the husband’s stepmother alleges that she and the husband’s father had a conversation in which they decided that they should gift two townhouses in D to two of their children, namely the husband and his stepsister.
The evidence of Mr S, the solicitor who acted on the transfer of the properties for the donees, but who was the long-time solicitor and friend of

the husband’s father, gave evidence that there was never any discussion by

the husband’s father to the effect that the property was a gift to the husband and his spouse. Mr S gave further evidence that, if that had been the intention of the husband’s father, he would have been told this. He also gave evidence that, after the death of the husband’s father, there had been a dispute between the husband and his stepmother.
In early 2000 the husband refinanced the mortgage on the wife’s N property.
In January 2000 the wife asserts that her ANZ Visa credit card had a balance of $2,000.
On 2 February 2001 the husband was registered as the sole proprietor of the D property.
In August 2001 the wife resigned from her employment with her family business when she was six to seven months pregnant with the parties’ first child.
In 2001 the husband and wife purchased a property at M Street, P (“the P property”) for $902,000. The husband contributed about $300,000 towards the purchase price and the parties obtained a loan for $600,000, secured by way of mortgage over the property.
In 2001 the parties’ first child, K, was born.
Between 2002 and 2007 the parties rented out the P property.
In 2003 the husband was offered a business opportunity in Europe.
Between 2003 and March 2005 the husband worked as a paid consultant of Mr L. He travelled to Europe about four times in this period, with all travel costs paid for by Mr L.
In March 2004 the husband was given a painting for his 36^th birthday. The wife disputes this, stating that they spent his birthday together and that he was not given any paintings. The husband also states that he received a painting from an unspecified Australian artist purchased in 1972 from the O Gallery in P.
In September 2004 the husband stood down as Managing Director of MS Pty Ltd.
Late in 2004 the husband’s father passed away.
In November 2004 the husband resumed his position at MS Pty Ltd.
In December 2004 MS Pty Ltd formed a joint venture company, SC Business, in Europe. MS Pty Ltd did not contribute the initial working capital so the joint venture agreement was voided.
In December 2004 SC Business was incorporated in Europe with the husband owning a third share in the company.
In late 2004 the parties’ second child, W, was born.
In March 2005 the husband resigned from MS Pty Ltd to pursue new business opportunities in Europe.
In May 2005 the parties and their children moved to Europe. It is the wife’s evidence that the husband told her they were only moving there for a

two-month trial period.
In September 2006 the wife deposes that the husband advised her that he would return to Australia in six months’ time. He in fact did not return for another two years according to the wife.
Early in October 2006 it is the wife’s evidence that the wife, the children and their housekeeper returned to live in Australia.
From November 2006 to October 2008 the wife and children resided in the D property while the P property was being renovated.
From December 2006 to January 2007 the husband returned to Australia. He purchased a prestige motor vehicle for the wife.
From February 2007 to February 2008 the husband lived in Europe and returned to Australia every eight to ten weeks.
In July 2007 SC Business made an agreement to sell 50 per cent of the company to U Investment Company subject to due diligence.
In September 2007 the wife’s N property was sold for $435,000. The net proceeds of sale were applied towards the renovations of the P property.
On 14 November 2007 an agreement was made to sell 50 per cent of SC Business to U Investment Company.
In 2008 the husband purchased two Australian artworks.
In March 2008 whilst living in Europe, the husband purchased a prestige watch for the wife for £8,000. The husband deposes that he also purchased other jewellery for the wife.
The wife’s evidence is that the parties first separated in May 2008 when the wife returned to Australia with the children.
At the end of May 2008 a Sale Purchase Agreement was signed confirming the sale of 50 per cent of SC Business to U Investment Company.
In August 2008 U Investment Company advised SC Business that it no longer wished to proceed with the purchase in its then format.
On 1 September 2008 the parties separated on a final basis according to the husband.
In September 2008 U Investment Company purchased more than 50 per cent of SC Business at a discount on the original purchase price. The husband deposes that he received no money from the sale.
On or about 16 October 2008, the husband asserts that he transferred to his mother, Ms G, €100,000 into her Westpac Bank account in Australia. The husband asserts that on or about 17 December 2008 his mother transferred these funds back to the husband in Europe.
In December 2008 the husband stood down from his position as Joint CEO.
In late 2008 or early 2009 the wife discovered that the D property was not registered in joint names and so she lodged a caveat.
In March 2009 the husband resigned from all executive duties within SC Business. At about the same time, SC Business effectively ceased to trade.
On 25 March 2009 the husband returned to Australia. He asserts that he attempted to obtain access to the D property as he had no other place to live but that upon arrival there he found that the property had been tenanted without his knowledge or permission. The wife disputes this and states that the husband told her to get a tenant for the property.
On 5 April 2009 there was an incident at the P property involving the husband taking the keys and allegedly being assaulted.
On 6 April 2009 the wife withdrew $238,711 from the mortgage redraw facility. On the same day, the wife purchased a motor vehicle for $37,000, paid legal expenses of $30,000 and allegedly paid her father $150,000.
On 6 April 2009 the husband deposes that he attempted to withdraw $500 from a Westpac ATM, and that the transaction was declined due to insufficient funds.
At or around the end of April 2009 the husband returned to Europe.
On 29 April 2009 the wife asserts that she paid the child K’s school fees on the husband’s American Express credit card.
On 6 May 2009 the wife asserts that she paid the child W’s school fees of $7,641.66 on the husband’s American Express credit card.
From May 2009 to October 2009 the husband searched for employment in Europe and England without success.
In June 2009 SC Business ceased day-to-day operations.
Sometime in 2009 the husband sold the prestige motor vehicle for €10,000.
On 7 October 2009 the wife paid $150,000 to her father. According to the wife, $100,000 of that sum was to repay her father for the cost of the parties’ wedding, which she says was a conditional gift, and $50,000 was to manage her spending. According to the wife, the wife’s father has spent $130,000 on paying the mortgage on the P property and the living expenses of the wife and children.
In 2009 the husband asserts that he borrowed €30,000 from Mr A, a lawyer in Europe.
In late 2009 the husband sold the second prestige motor vehicle for $11,000.
In January 2010 the tenant vacated the D property and the husband moved into it. The wife asserts that she was not consulted about this.
On 17 June 2010 parenting Orders were made by consent between the parties.
In October 2010 the husband asserts that he developed a business plan with

Mr Z to purchase a hospitality business. He asserts that he could not complete the transaction because he could not raise the finance due to the caveat on the D property.
On 11 December 2010 the husband asserts that he and his mother entered into a loan agreement in respect of a loan for $45,000.
In March 2011 the wife had a mastectomy as a result of breast cancer. The wife was certified as unfit for work thereafter.
It is the wife’s assertion that the marriage broke down irretrievably on 5 April 2011.
On 17 May 2011 Orders were made by Le Poer Trench J permitting the husband to refinance the mortgage over the D property in an amount not greater than $150,000 and ordering the wife to do all things necessary to enable this. Orders were also made with respect to child support with the effect that until the final determination of these proceedings or until the parties agreed otherwise:
a)the child support payable (current and arrears) by the husband to the wife in respect of the children K and W was stayed
b)the Child Support Agency was restrained from releasing to the wife the sum of $8,573.19 which had been garnished from the husband on 5 May 2009.

The issues to be determined with respect to alteration of property interests

What is the property of the parties to the marriage or either of them?
Is it just and equitable to make an order which alters the interests of the parties to the property identified above?
What is a just and equitable re-distribution of that property, having regard to the contributions made by each of the parties as described in s 79 of the Act?
Given the assets of the parties to the marriage or either of them, what, if any, is an appropriate alteration to their property interests which will do justice as between them, having regard to the matters required to be taken into account under s 75(2) of the Act?
Does the requirement of justice and equity require of the Court any further consideration to the alteration of property interests determined aliunde?

The Evidence

In his case outline document the husband stated that he relied upon the following material:
a)Amended Initiating Application filed 14 February 2011
b)
Affidavit of the husband sworn 24 November 2011 and filed

25 November 2011, together with earlier affidavits of the husband adopted therein
c)Affidavit of the husband sworn 19 January 2012 and filed 20 January 2012
d)Affidavit of the husband’s mother, Ms G, filed 20 January 2012
e)Joint balance sheet filed 21 June 2011 and an updated balance sheet provided at the hearing
f)Financial Statement filed 29 November 2011.
The husband also sought to rely on the unsworn and unfiled affidavit of Mr S, as and by way of a proof of evidence. Mr S was not a willing witness and was the subject of a subpoena to give evidence. Mr S gave evidence on the first day of the trial.
Mr S’s evidence related to the issue of two sealed envelopes produced by him pursuant to a subpoena. The two envelopes were addressed to the husband and Ms T, the husband’s step-sister. Mr S’s evidence was that the two envelopes were only to be opened in circumstances of a simultaneous death of the husband’s father and stepmother.
Mr S was directed to produce the two envelopes to the Court but the parties and their legal representatives were not given leave to inspect the documents at that stage.
There were issues as to whether these documents were privileged, whether the envelopes could be opened and whether the information contained therein would have a bearing on the proceedings currently before the Court.
The Court instructed Counsel for the parties to select an independent barrister to inspect the documents to ascertain whether they would be relevant to the proceedings. Ms Knox, Counsel was selected by the parties to hold the documents until further order of the Court.
The matter came before the Court again on 9 August 2012 to address the issues of the sealed envelopes. Ms Knox determined that the documents contained within the envelopes were “potentially relevant”. The husband made an application to view the documents and the wife supported this application.
The husband’s stepmother opposed showing the letters to the parties as she was an author of the documents which were of a private nature and of limited relevance.
The Court found it appropriate for the documents to be inspected by the legal representatives of the parties.
In her case outline document the wife stated that she relied upon the following material:
a)Response to Amended Initiating Application filed 17 May 2011
b)Financial Statement filed 21 June 2011
c)Financial Questionnaire filed 21 June 2011
d)Joint Balance Sheet filed 21 June 2011 and an updated balance sheet provided at the hearing
e)Affidavits of the wife filed 11 October 2011 and 28 October 2011
f)Affidavits of the wife filed 15 February 2012 and 22 February 2012
g)Affidavit of the husband’s stepmother, Mrs Grattan Snr, sworn 8 November 2011 and filed 15 November 2011
h)Affidavit of the wife’s father, Mr Y, filed 7 March 2012
i)the wife’s list of objections.

Credit

In relation to matters of credit, the Court makes no general findings as to credit. The preferred evidence will be evident from the findings and conclusions in the case in respect of particular issues.

The Orders sought

The husband sought orders that the P property be sold, in the first instance by private treaty and, in the event that the property is not sold by private treaty within three months, that it be sold by public auction.
The husband also sought orders to the following effect:
(3)The husband seeks that upon the sale of the property the proceeds of sale shall be paid in the following manner and priority:
(a)In payment of agent’s commission and auction expenses if any due on the sale
(b)In payment of legal costs of sale
(c)In discharge of the outstanding mortgage to Westpac Bank
(d)In payment to the wife of an amount equal to 60% of the net proceeds of sale
(e)In payment of the balance then remaining to the husband.
(4)That the husband be declared the sole owner to the exclusion of the wife of the property registered in his name at [D] Street, [D], being the whole of the land contained in Folio Identifier …
(5)Except as otherwise provided the husband and wife are entitled to be the sole legal and beneficial owners of all items of property including money, motor vehicles, insurances, equities, superannuation entitlements and personal effects currently in the possession or control of each of them respectively.
(6)That the wife pays the costs of the husband.

The wife sought orders to the following effect:
(1)That the husband do all things necessary to transfer to the wife an unencumbered interest in the property known as [M] Street, [P]
(2)Except as otherwise provided the husband and wife are entitled to be the sole legal and beneficial owners of all items of property including money, motor vehicles, insurances, equities, superannuation entitlements and personal effects currently in the possession or control of each of them respectively.
(3)That the husband pay the costs of the wife.

Property matters

The first step I must undertake is to identify the property of the parties or either of them available for division between them.

The Balance Sheet

The Court at the commencement of the hearing was provided with the balance sheet set out hereunder for its consideration.

Ownership		Description	Wife’s Value ($)	Husband’s Value ($)
ASSETS
1	Joint	P property	1,725,000	1,725,000
2	H	D property	1,050,000	1,050,000
3	W	Jaguar Motor Vehicle	37,000	$37,000
4	H	Harley Davidson … motor bike	30,000	15,000
5	H	Mercedes Benz motor vehicle	20,000	20,000
6	H	Artwork 3	16,500	16,500
7	H	Artwork 4	9,000	9,000
8	H	Artwork 1	Unable to be valued as the wife claims it not to be in her possession
9	H	Artwork 2	Unable to be valued as the wife claims it not to be in her possession
10	W	Prestige watch	11,500	11,500
11	W	Diamond bracelet	10,000	10,000
12	W	Diamond ring	Unable to be valued as the wife claims it not to be in her possession
13	W	X brand Watch	Unable to be valued as the wife claims it not to be in her possession
14	H	Household contents D property	20,000	20,000
15	Household contents P property	30,000	30,000
TOTAL:			$2,959,000	$2,944,000
ADDBACKS
16	W	Sum taken by wife from joint accounts	238,000	238,000
17	H	Sum husband has allegedly retained in Europe	354,000
TOTAL:			$592,000	$238,000
LIABILITIES
18	Joint	Home loan for P property (Westpac)	650,000
19	H	Loan from Ms G (Husband’s mother)	45,000
20	H	Loan from Mr A	45,000
TOTAL:			$740,000
SUPERANNUATION
21	H	Bankers Trust	$35,000

In relation to Item 16, being the monies taken by the wife from the joint accounts, the parties do not disagree as to the quantum, but rather whether this amount should be notionally added back to the balance sheet of property of the parties or either of them. There is nothing in the legislation which requires the Court to alter interests in notional property and accordingly notional property will not be added back into the balance sheet. The receipt of the money by the wife and the consideration of the evidence of its application will be undertaken by the Court in its considerations under the provisions of section 75(2).
In relation to Items 19 and 20, these appear to be debts incurred by the husband post separation and they will be taken from the balance sheet. The fact that the husband owes these debts is, however, a matter which will be taken into account under the Court’s consideration of section 75(2) factors.
The Court notes that Items 8, 9, 12 and 13 were unable to be valued by the parties.

Issues of disclosure

The wife asserts that the husband has failed to account for substantial withdrawals from both the company and family trust accounts in the sum of over $354,000. The wife also asserts that there is no explanation from the husband as to the whereabouts of €100,000 injected into the husband’s company in Europe. The Court accepts the evidence of the husband in relation to this sum – namely, that it was transported from Europe for reasons of security then thought to exist with respect to the global financial crisis in Europe and returned to Europe when those reasons no longer seemed important.
The property was not that of the husband in any event. The monies were negotiated through a trust account of a certain trust of his mother, Ms G. The Court finds that the husband had an influential role in the management of the affairs of the trust and that Ms G was naïve in relation to the niceties of the trust. However the Court does accept the husband’s evidence as to the export and repatriation of the funds.
The wife submits that there is no explanation from the husband as to the whereabouts of the proceeds of sale (or to the continued existence and value) of the first prestige motor vehicle and the “BL Development” in City H which was being renovated as at 17 September 2008.
The wife also submits that the husband has failed to disclose details of his European bank accounts and credit cards and details of the companies G Pty Limited, B Pty Ltd and E Business.
I find in relation to those matters as follows.
With respect to the prestige motor vehicle, the husband during cross-examination stated that the vehicle was a company car which had been sold and that he did not receive the proceeds from that sale.
With respect to house complex in City H, the husband during cross-examination deposed that the property is fully owned by the bank at the present time and that, while the property is being rented, the liquidator is receiving the rent on it.
With respect to the husband’s European bank accounts, the evidence is unclear. The husband has deposed that there are no funds in these accounts or otherwise held in accounts overseas that have not been accounted for and the wife has not produced evidence to the contrary.
The husband was however clear in his explanation of the failure of his European business interests which were in liquidation at the time of the hearing. He gave details of the liquidators’ seizure and use of the property in which the parties resided. If in the liquidation process the husband receives a substantial sum (which is not his evidence), the wife will have a right to apply under section 79A of the Family Law Act 1975 (Cth) for a setting aside of orders altering the parties’ property interests. To this end, the Court intends to order the husband to disclose to the wife any sum received by him as a result of the liquidation.
In relation to the Harley Davidson motor bike, no evidence was adduced as to its value. In those circumstances, the Court will accept the admission against interest of the husband as to its value.
I find the assets and liabilities of the parties are as follows:

Assets	($)
P property (j)	1,725,000
D property (h)	1,050,000
Jaguar motor vehicle (w)	37,000
Harley Davidson motor cycle (h)	15,000
Mercedes Benz motor vehicle (h)	20,000
Artwork 3	16,500
Artwork 4	9,000
Prestige Watch (w)	11,500
Diamond Bracelet (w)	10,000
Household contents, D property (h)	20,000
Household contents, P property	30,000
Superannuation: Bankers Trust (h)	35,000
Total assets (including superannuation)	$2,979,000
Liabilities
Home loan for P property (Westpac)	650,000
Total liabilities	$650,000
Net asset pool (including superannuation)	$2,329,000
Note: the net asset pool does not include assets which are said to exist but which cannot be located or valued.

Whether the parties’ property interests should be altered

The wife and the husband were married for approximately eight years and eight months but are now separated. The mutuality that was attendant between the parties during their marriage no longer exists and the parties’ current title to their property does not reflect what will allow each of them to manage their affairs into the future.
There will be as a consequence of the breakdown of their marriage a discontinuance of such fiscal unity and cooperation as previously existed.
The parties have no agreement as to the division of their assets consequent on the failure of their marriage.
In the circumstances, I find that it is just and equitable to make an order adjusting the property interests of the parties. The Court now turns to the nature of the order which should be made.

Section 79(4) contributions

Initial Contributions

The husband contends that he made the following contributions:
a)an initial contribution of $617,000 savings (net) and a motor vehicle valued at $50,000
b)the introduction of the block of land at D Street, D valued now at $1,050,000
c)an ongoing contribution throughout the marriage in applying his earnings for matrimonial purposes.
The D property was a gift from the husband’s late father and stepmother. There was an issue as to whether this was a gift just to the husband or to both parties. As discussed above, the Court favours the husband’s evidence in relation to this issue and finds that it was a gift to the husband only.
At the time of the marriage, the wife was the owner of a property at N. The proceeds of the sale of this property were put towards the renovation of the P property which was overseen by the wife.

Contributions to date of separation

The husband asserts that the wife’s conduct while the parties were in Europe (including while the husband was there on his own) had a significant negative effect on the financial well-being of the parties. The conduct of the wife is not seen by the Court as necessarily unreasonable, although it seems clear that it made more difficult the husband’s position and perhaps, for that reason, gave some greater value to his contribution.
The husband concedes that the wife has made a greater contribution as a homemaker and parent than the husband, although the husband’s contribution up to the time of separation is said to be not insignificant.
The wife was the primary carer for the children and cared for the children for approximately two years whilst the husband resided overseas. The wife asserts that the husband spent approximately 20 weeks with the children between 2007 and 2011.
The wife asserts that she was responsible for the management and improvement of the D property in the husband’s extended absence overseas, including management and oversight of the renovations that were conducted. She states that she contributed financially and non-financially to the property, including by her father’s contributions to the renovations.
The wife made contributions to the day-to-day upkeep of the P property and the parties’ motor vehicles. She also made a significant contribution to the P property from the proceeds of sale of her N property which were applied to the renovation of the P property.
The husband’s initial financial contributions were significant and amounted on his contention to savings of about $617,000 (net) and a motor vehicle said to have been worth about $50,000.
The husband brought into the marriage the property at D, which has a current value of about $1,050.000.
There is also no doubt that the husband’s income during the marriage was also a significant financial contribution by him.

Contributions post separation

The husband asserts that the wife’s conduct post separation, including the placing of a caveat on the D property, has had a negative impact on the husband’s financial position.
The husband deposes that he borrowed $8,000 from his mother to pay the school fees owing to the children’s school.
The wife paid the children’s school fees in April and May 2009 on the husband’s American Express credit card.
The wife asserts that, in March 2011, she paid the pre-school fees from the money that she had taken out of the joint account.
The wife has had the primary full-time care of the children from separation to June 2010.

Conclusion based on contribution

All in all, I assess the contributions of the parties to the acquisition, conservation and improvement of the property of the parties to the marriage or either of them, including such property which is no longer the property of the parties to the marriage or either of them, to be 40 per cent to the wife and

60 per cent to the husband to the date of their separation.
The wife seeks an adjustment in relation to a determination based on the financial and non-financial contributions to the property and welfare of the family.

Section 75(2) considerations

The husband is 44 years of age.
The wife is 47 years of age.
The husband is in good health.
The wife’s health is an issue. She has undergone at least five years’ ongoing oncology treatment for breast cancer. The wife also submits that she requires further gynaecological surgery related to her breast cancer. The husband submits that there is no evidence to suggest that the wife’s condition is of an ongoing or serious nature. The wife however deposes to her need for continuing medication for her condition.
The wife submits that her own treatment, together with her attendance to the child K’s health issues (a hernia on the brain), preclude the wife from entering into full-time work. The Court accepts that this is so, but does not ignore the possibility of the wife procuring some part-time work in the future.
The wife is gaining work experience in volunteer work at the children’s school.
The husband works as a company director through a company set up by him. The wife submits that the husband has not disclosed details of his income.
The wife has always been the primary carer of the two children and continues to be so. The husband concedes that the wife is in this position.
According to a parenting plan agreed to by the parties, the children spend time with the husband each alternate weekend from Thursday evening to Monday morning before school. The wife submits that this no longer is the case and that the husband has ceased seeing the children.
The wife submits that she is responsible for all costs and financial responsibilities associated with the care of the children, including K’s health expenses, and that she receives little or no assistance from the husband.
During cross-examination, the husband deposed that he was paying for his children’s “school fees, school clothes, tennis lessons and camping expeditions” and that he “will continue to do so.”
The wife concedes that the husband has commenced paying 50 per cent of the children’s school fees, however, she submits that the Court cannot be satisfied that the husband will provide adequate ongoing financial support for the children who are still very young. The wife seeks a substantial adjustment in her favour due to this factor combined with her poor health, her unemployment and the income disparity between the parties.
The wife argues that the husband is assessed to pay child support but that he has a history of non-payment. As at March 2012, the wife submitted that the husband was in arrears in excess of $8,000 for his child support liability. The husband obtained a stay on paying this figure until further order on 17 May 2011.
The Court notes that the wife has had the benefit of $238,000 which was withdrawn from the parties’ joint account. The wife’s evidence is that she applied that sum as follows.
a)in payment of the sum of $150,000 to the wife’s father. Her evidence is that, of that amount, a sum of $100,000 was paid back to him to reimburse him for the costs of the parties’ wedding reception. The wife states that she felt bound to repay her father this money since he had said to her at the time of the marriage, “If [the husband] walks out, then I want to be paid back.” There is no evidence of the wife’s acceptance of the money used for the reception on those terms; the evidence simply stands with the statement made by the wife’s father. The Court accepts that the husband was unaware of the statement and also accepts that he was neither party to nor condoned any such agreement, as is alleged. In all the circumstances, the Court will consider that the wife received the sum of $100,000 and applied those funds for her own use. In saying that, the Court acknowledges that some portion of the money paid by the wife has been applied to the repayment of mortgage payments on the P property. That property was one which was, after the separation, solely occupied by the wife and the children to the exclusion of the husband. In that regard, the wife deposes to having paid the sum of $4,000 per month for a period of 30 months. This was a reasonable living expense and constituted the cost of the accommodation for the wife and the children.
b)the wife further asserts that the $50,000 paid to her father was paid by her to enable her to “help me manage [her] spending”.
c)the wife applied the sum of $37,000 to the purchase of a motor vehicle and that amount is reflected in the balance sheet.
d)the wife applied the sum of $30,000 toward meeting her legal bills.
e)the balance the wife says was applied to mortgage payments.
The Court finds that the justice of the case requires the Court to take into account the amount received by the wife, however $67,000 of that amount is accounted for in either legal bills or assets. Of that amount, the assets are taken into account in the balance sheet, but the wife will clearly be attributed with the benefit of the legal expenses and to some part of the mortgage payments. The Court does not find it just that the husband should be required to assume any alleged liability to the wife’s father for the costs of the wedding. Since the wife asserts that as a result of the transactions there is now a debt to the father, she will be obliged to assume sole responsibility for that alleged debt.
It seems clear that the husband’s legal fees have also been considerable and funded from a loan from his mother or her trust. Repayment of that amount will be the husband’s responsibility, as will be repayment of the loan of $45,000 from Mr A.
The husband has some superannuation to the value of $35,000 and the wife does not.
The Court does not take into account the husband’s alleged failure to account for monies. The Court takes the view that, in the circumstances of the liquidation of the companies in Europe, the husband has given sufficient quittance of his position, given what appears to be his lack of power over the enterprise. It is clear that there is no evidence of undeclared assets. The Court will do what it can to seek to ensure that if the husband receives any benefit from the liquidation of the companies in Europe he will be under an obligation to inform the wife of that event.

Conclusion on section 75(2)

For the reasons referred to above and in the circumstances, the Court finds that there should be a section 75(2) adjustment in favour of the wife. That adjustment will take into account the clear differential in the parties’ earning capacities and the wife’s restricted earning capacity and her ongoing role in relation to the primary care of the children. Whilst the husband has had a period of unemployment, that now seems to be at an end. Also, whilst the husband’s income is not as high as it was, it nevertheless outstrips the wife’s income or earning capacity.
In the circumstances, the Court finds that it is appropriate to make an adjustment in favour of the wife to the extent of 13 per cent of the assets.

Overall division of assets

The above determination will see the wife receive 53 per cent of the parties’ assets and the husband receive 47 per cent of those assets.

Just and equitable

The division of assets would see the wife receive $1,234,370 worth of the net assets and the husband receive $1,094,630 worth of the net assets.
In the circumstances of this case I determine that result to be just and equitable.

Orders which should be made

I propose orders which will give effect to the following division of the parties’ assets.
The wife will receive:

Assets	($)
P property	1,725,000
Jaguar Motor Vehicle	37,000
Prestige watch	11,500
Diamond Bracelet	10,000
Household contents P property	30,000
Diamond Ring and X brand Watch	0
Payment by the husband to the wife	70,870
Total assets	$1,884,370
Liabilities
Amount due to the Westpac Bank for a home loan on P property	650,000
Total liabilities	$650,000
Net assets	$1,234,370

The husband will receive:

Assets	($)
D property	1,050,000
Harley Davidson Motor Bike	15,000
Mercedes Benz motor vehicle	20,000
Artwork 3	16,500
Artwork 4	9,000
Artwork 1	0
Artwork 2	0
Contents of D property	20,000
Superannuation – Bankers Trust	35,000
Total assets (including superannuation)	$1,165,500
Liabilities
Payment by the husband to the wife	70,870
Total liabilities	$70,870
Net assets (including superannuation)	$1,094,630

Child Support

The child support (both current and in arrears) payable by the husband to the wife in respect of the two children was stayed by orders of this Court on

17 May 2011. By the same orders, the Child Support Agency was restrained from releasing to the wife funds in the sum of $8,573.19 which were garnished from the husband.
On day two of the final hearing in these proceedings, the husband stated that he did not oppose the release to the wife of the garnished funds held by the Child Support Agency. The Court will therefore make an order that the funds garnished by the Child Support Agency should be released to the wife.
In relation to the assessment of child support, the wife seeks an order to have the stay on the child support payments lifted. The husband has not been reassessed for child support and had not consented to the stay being lifted by the time of the hearing.
The Court notes that since separation the wife has drawn significant funds from the parties’ joint accounts and that part of such funds have been utilised to meet her own expenses and those of the children. Through the use of these funds, the wife has been able to meet the needs and expenses of the children since the time that the stay on child support payments was ordered. The court also notes that the husband in his evidence deposed that he has been contributing, and that he will continue to contribute, towards the costs of the children through the payment of school fees and other expenses.
The Court will make an order that continues the stay on the husband’s child support payments from the date that the stay was ordered to the date of the Orders hereof, and an order that dissolves the stay as and from the date of the Orders hereof.
The Court also declares that the child support otherwise accruing under the husband’s assessment to the date and time of the lifting of the stay be deemed to have been paid, and that any future assessment for child support is to be assessed from the date of the lifting of the stay.

I certify that the preceding one-hundred and seventy-one (171) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Fowler delivered on 12 December 2012.

Associate:

Date: 12 December 2012

[2012] FamCA 1090

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Property Law

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