HANSI & HANSI

[2020] FCCA 2087

FEDERAL CIRCUIT COURT OF AUSTRALIA

HANSI & HANSI [2020] FCCA 2087

Catchwords:
FAMILY LAW – Property – parties divorcing in 2018 after 41 year marriage – matrimonial home being the only ascertainable asset of the parties – major dispute about parties’ assets in Sri Lanka – wife’s assertion that husband retains significant assets in Sri Lanka denied by the husband – husband selling house in Sri Lanka and retaining entire proceeds of sale to his own benefit – sale proceeds roughly commensurate with equity in the matrimonial home – husband failing to disclose and not complying with orders for financial disclosure – Court’s conclusion that it is just and equitable for the wife to retain the matrimonial home to the exclusion of the husband. 

Legislation:

Family Law Act 1975 (Cth), s.75(2)

Cases cited:

Baglio v Baglio [2013] FamCA 105

Chang & Su (2002) FLC 93-117

Stanford v Stanford [2012] HCA 52

Applicant: MS HANSI

Respondent: MR HANSI

File Number: DGC 731 of 2019

Judgment of: Judge Burchardt

Hearing date: 10 July 2020

Date of Last Submission: 10 July 2020

Delivered at: Dandenong

Delivered on: 5 August 2020

REPRESENTATION

Counsel for the Applicant: Ms Teicher

Solicitors for the Applicant: Lawyers By The Bay

Counsel for the Respondent: Self-represented

Solicitors for the Respondent: Not applicable

ORDERS

1. The parties forthwith do all things and sign all documents necessary to transfer the Respondent’s interest in the real property situate at C Street, Suburb D in Victoria to the Applicant at a time the Applicant requests and that the costs of such transfer be paid by the Respondent.

2. Pending the transfer contemplated by Order 1 above, the Applicant have the sole right to occupy the real property situate at C Street, Suburb D in Victoria and during such right of occupation the Applicant shall pay all instalments pursuant to the mortgage together with all rates, taxes and like apportionable outgoings of the real property as and when they fall due and maintain all insurances in respect of the real property.

3. In the event that the rules of lending change such that the Applicant becomes unable to obtain permission from a lending institution that will allow her to take full title to the real property situate at C Street, Suburb D, the parties shall forthwith do all such acts and things and sign all such documents required to list the real property situate at C Street, Suburb D for sale at a time and by a method of the Applicant’s choosing. The sale proceeds shall be applied as follows:

   (a)Firstly to pay all costs, commissions and expenses of the sale and conveyancing;

   (b)Secondly to discharge any mortgage and any other encumbrance affecting the real property; and

   (c)Thirdly the remainder to be paid 100% to the Applicant

4. Unless otherwise specified in this Order except for the purposes of enforcing payment of any money due under these or any subsequent Orders:

   (a)Each party shall be solely entitled to the exclusion of the other to all property in the possession of such party as at this date including any jewellery, furniture, furnishings, shares and motor vehicles;

   (b)Monies standing to the credit of the parties in any bank accounts to be the property of the party in whose name such bank account is held;

   (c)Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to this Order.

5. Either party have liberty to apply as to implementation or enforcement of these orders upon the giving of 7 days written notice to the other.

6. In the event that the husband fails to comply with orders 1-3 hereof, pursuant to s.106A of the Family Law Act 1975 (Cth), a Registrar of the Federal Circuit Court of Australia at Dandenong forthwith execute the necessary documents in the name of the husband.

7. Any application for costs supported by written submissions of no more than 3 pages be filed and served on or before 12 August 2020.

8. Any written submissions in reply of no more than 3 pages be filed and served on or before 19 August 2020.

IT IS NOTED that publication of this judgment under the pseudonym Hansi & Hansi is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

DGC 731 of 2019

MS HANSI

Applicant

And

MR HANSI

Respondent

REASONS FOR JUDGMENT

Introductory

1. This is a property dispute between a couple who were married for over 41 years.  There are no dependent children. Ordinarily, one might imagine that absent any particularly unusual features, the division of the parties’ property would be likely to be approximately 50/50.  That is indeed the position of the respondent husband.  The applicant wife, however, seeks to retain the matrimonial home to the entire exclusion of the husband, this being the parties’ only asset of any great significance. 

2. The reason for this position on the mother’s part is that the husband, as she asserts (the parties are divorced but it is convenient to continue to use this nomenclature), has kept entirely to himself all assets that the parties formerly owned in Sri Lanka.  These are said to amount to assets worth in excess of $500,000 that were to be brought to Australia pursuant to a declaration made in a migration application in 2003.  Additionally, the husband is asserted to have retained to his own benefit entirely the proceeds of the sale of the property formerly owned by the parties in Sri Lanka. 

3. There is a dispute as to how much the net proceeds of sale were, but they were worth either over $300,000 (wife’s version) or $200,000 (husband’s version).  It is put that because of this abstraction of assets, it is just and equitable that the wife should retain the matrimonial home to the entire exclusion of the husband.

4. It is also put that the husband has contumeliously failed to comply with his obligations of disclosure, and that this buttresses the wife’s position.

5. For the reasons that follow, I think that the wife is correct to say that the husband’s approach to disclosure has been dilatory at best.  It is not possible for the Court as a result to say exactly what assets there may have been in Sri Lanka.  In all the circumstances, in my view, it is just and equitable that the wife should have the relief that she seeks.

Agreed or Uncontroversial Matters

1. The wife was born in 1951 and the husband was born in 1953.  They married in 1977 and were ultimately divorced on 19 November 2018 after a separation, albeit, under one roof, of one year.  They have two children, Mr E, born in 1978, and Mr F, born in 1995. 

2. The parties are both of Sri Lankan extraction, and although it appears clear that Sinhalese is the husband’s first language, it appears that they spoke in English throughout their relationship.

3. In 2003, the parties applied to come to Australia, where their eldest son was already living.  In the course of that application, they indicated that assets to the value of $500,000 would be brought to Australia with them. 

4. In 2016, the husband sold the former family home in City G, Sri Lanka, although there is, as I have indicated, a dispute as to how much the nett funds were. 

5. There are a number of other matters that may not themselves be the subject of so great a dispute, but this gives some framework of the parties’ positions.

6. The wife worked until very recently as an health care worker.  The husband ceased work following an injury at work in 2011, for which he appears to have received a nett payout in the ultimate of some $40,000.

The Parties’ Affidavits

1. I have of course read the parties’ affidavit material carefully and had regard to all of it.  Much of what the parties have to say is indicated in the agreed matters above.  The following points emerge from the parties’ affidavit material. 

2. The wife’s first affidavit, filed 12 March 2019, deposes to the commencement of her relationship with the husband in 1977, in Sri Lanka, and their marriage and divorce.  She deposed the purchase of the former matrimonial home in City G in 1980, funded from the parties’ savings.  It would appear that what was bought was a block of land, and the wife asserted that they moved into the property in 1983, at the time of the birth of their second child, H, who tragically died in 1989.  The wife deposed that their eldest child came to Australia to study in 1997 and that they visited him in 2001 and obtained visas to move to Australia in 2005 through the Contributory Parent visa scheme.

3. Following the move to Australia, the wife deposed to her own work at, inter alia, Employer J, this being of assistance to enable Mr F to attend that school.  She deposed to the husband being injured in 2013 but not knowing how much he received by way of compensation.  She went on to depose to the sale of the home in Sri Lanka in 2016 for 37 million rupees, or about $400,000.  She deposed that the sale documents showed a price of 35.890 million rupees, and that this was a common tax minimisation practice.  She deposed to the purchase of the matrimonial home in Suburb K and its sale in 2017, following which the current matrimonial home in C Street, Suburb D was bought with a loan of $280,000.  The wife deposed that the funds obtained from the sale of the property in Sri Lanka were put into accounts in the husband’s name because that was the custom in Sri Lanka.  She deposed the husband insisted the money from that sale was his alone.

4. The wife went on to complain of non-disclosure on the husband’s part as to the monies from the sale of the home in Sri Lanka.  The husband passed through his solicitor a statutory declaration to the wife’s solicitor saying that the accounts from which the sale of the Sri Lankan money were paid into were stolen from his briefcase, and that he would have to attend Sri Lanka personally to obtain new statements.  The wife deposed to the capacity of the husband to obtain these statements from the internet.

5. The wife’s financial statement, filed 12 March 2019, relevantly discloses superannuation of $63,710. 

6. The husband’s first affidavit, filed 11 April 2019, deposes the move to Australia in 2005 and to the Australian citizenship of all the parties.  He deposed to the purchase of a first home in Sri Lanka using funds allegedly from his savings.  He deposed to the purchase of a home in Suburb K in 2007 for $525,000, and its sale in 2017 for $970,000, with a nett profit of approximately $330,000.  He confirmed the purchase price of the C Street, Suburb D property at $555,000 and a $280,000 mortgage.

7. The husband deposed to his work until 2013 when he sustained serious back injuries, eventually receiving a settlement of $60,000 in 2015, of which $20,000 was used to pay for legal fees.  He deposed to the fact that since he had ceased employment, he was using his WorkCover compensation and superannuation which he cashed in in 2013 in the sum of approximately $30,000, together with “sale proceeds from Sri Lanka to fund daily living expenses.”  He went on to depose that since January 2017, he had been receiving Centrelink payments under the Newstart scheme, and since January 2019, an aged pension.

8. The husband went on to depose to the sale of the Sri Lankan home in May 2016 for approximately $205,000, being 22,500,000 rupees.  He annexed as “H-1” a copy of the instrument of sale and transfer signed in April 2016, it would appear, by the vendor and purchaser, showing a sale price of 35,890,000 rupees.

9. The exhibit also has a registration of title dated 27 May 2016, showing a sale price of 22,500,000 rupees.  Annexure “H-2” is purported to be a letter from the solicitor who handled the sale of the property confirming a sale price of 22.5 million rupees. 

10. The husband went on to depose that those funds were lodged into his accounts with the L Bank and M Bank in May and June 2016.  He deposed to withdrawing $203,000 of that money out of those accounts in June 2016.  At paragraph 19 of his affidavit, he went on to depose: 

    From the withdrawals I made from Sri Lankan bank accounts the following amounts were paid into my CBA account, ending in #...15 –

    and details sums of $49,975 on 6 June 2016 and $39,975 on 16 June 2016, obviously, a total of just under $90,000.  He went on to depose that he brought in $20,000 in cash after withdrawals from Sri Lanka in two entries of $10,000 each time.  He deposed to a holiday in 2016 in the USA for the family at a cost of $33,000.

11. At paragraph 22, he deposed again: 

    The balance of my withdrawals I spent in Sri Lanka whilst there, for living expenses and to give to my family.  From 2013 to now, I have been back to Sri Lanka on a yearly basis to visit my elderly and sick mother and extended family.

12. It should be noted that even on the figures provided by the husband, only about $140,000 of the monies from the alleged sale price are accounted for, save to the extent that the husband asserts that between 2016 and 2020, he must be assumed to have spent $60,000 while being in Sri Lanka.

13. The husband went on to depose that his workers’ compensation money was expended as a gift to his son, Mr F, or otherwise expended to Mr F’s benefit.  He goes on to assert having paid for renovations at the C Street, Suburb D house in some $10,000, and $10,000 for the wife’s motor vehicle in August 2016. 

14. The husband went on at paragraph 30 to vigorously deny that he received $290,000 from the Sri Lankan house sale, superannuation, WorkCover, and other income.  He went on to say that he had spent half of all the living expenses and had assisted his son, Mr F.  He asserted at paragraph 30: 

    The fact is all the money is gone and there is no hidden money anywhere.  I spent everything in living expenses.

15. Under the heading Disclosure, the husband went on to depose, at paragraph 32: 

    After 2016 when our home in Sri Lanka was sold I returned to Australia with the necessary documents for its sale for my records.  Unfortunately, my briefcase was stolen and as a result I lost all records of the sale.  Hence, I was unable to disclose exactly how much it sold for and what amount was deposited into the Sri Lankan banks.  Since sustaining my injuries my memory often fails me.

16. He went on to depose to his endeavours to comply with his obligations of disclosure.  The wife’s next affidavit, filed on 18 April 2019, responded to these assertions.  I note that the wife also deposed to injury, resulting difficulty and a WorkCover period of incapacity.  I note that she said that she had applied at age 67 for an aged pension.  She basically put in issue all the husband’s assertions as to financial contribution.  In relation to the difference between the two prices for the sale of the property, being 37 million and 22.5 million rupees, respectively, the wife said at paragraph 15: 

    That is a common practice in Sri Lanka for minimising cost associated with sale of real property. The Sri Lankan solicitor who signed exhibit H2 of the Respondent’s affidavit is the same solicitor who prepared the property transfer document that understated the sale price.  I have asked the broker who handled the sale of the property to confirm in writing the true sale price.

17. The wife then put in issue such matters as the cost of the Country N holiday, the amount advanced to the son, Mr F, and other matters.  She complained of the non-provision of bank records from Sri Lanka, and asserted that the husband has $400,000 in term deposits in Australia and Sri Lanka.  She pointed to the fact that the statutory declaration first provided by the husband, dated 31 October 2018, asserted:

    …original receipts and records were stolen from my briefcase –

    and the fact that the husband was now asserting that his briefcase was stolen.  She complained of the husband’s failure to disclose his accounts in Sri Lanka. 

18. The husband’s next affidavit, filed on 23 July 2019, responded.  He again repeated the sale price of the Sri Lanka property as 22.5 million rupees.  He went into greater detail about the Country N journey and the assistance he had given to both Mr F and the wife.  He set out his own living expenses, which I note he deposed were approximately $1,200 a month (paragraph 22).  He deposed to $12,000 spent on renovations to the Sri Lankan house in 2016, $10,000 on broker’s commission and incidentals, and rates and utilities paid for in cash in the sum of $12,000.  He deposed that documents relating to those expenses were stolen from his briefcase.

19. I would interpolate and say that rates and expenses on that scale are utterly unbelievable.  They would be extremely improbable even on a significant property in Australia.

20. The husband went on to depose at paragraph 27: 

    I have spent over $210,000 as outlined above from the above expenses.  This is more than the property in Sri Lanka sold for.  The rest of the expenditure were obtained from the pension I receive from Centrelink.

21. The wife’s next affidavit was filed on 14 August 2019.  It annexed relevantly as “H1” a letter from the sales agent who sold the Sri Lankan property, and an affidavit made by the purchaser at the time of sale.  These both support a sale value of 37 million rupees, and I note that agency commission was asserted to have been 3 per cent or 1.11 million rupees.  The annexure includes what purports to be an affidavit from Mr O, the alleged purchaser, sworn on 23 April 2016, confirming the sales price.  Why Mr O would have felt it necessary to swear an affidavit to this effect in 2016 when he was purchasing the property remains wholly unexplained.

22. The affidavit traversed the provision of bank accounts from Sri Lanka which the wife deposed were unsatisfactory for a number of reasons, and deposed that the respondent could easily have obtained false accounts, in any event.  She traversed matters arising from the transactions in the respondent’s Commonwealth Bank account in Australia, and put in issue the expenditures both in the Country N and for Mr F that the husband had deposed to.

23. The husband’s next affidavit was filed on 16 August 2019.  It criticised annexure “H1” to the wife’s previous affidavit, and said that the sales representative was in fact the applicant’s nephew who was never involved in the sale of the property.  “H-1”, attached to his affidavit, purports to be an affidavit from Mr P as to the execution of the sales document, and that its price was reduced to $22.5 million.  He also provided what was said to be an updated affidavit from the purchaser in June 2019, confirming the lower price.

24. He went on to assert that he had indeed complied with his obligations to disclose his accounts with the L Bank and M Bank, and tried to explain differences in the form of documents so provided.

25. The wife’s next affidavit was filed on 17 October 2019.  She deposed to the fact that on 19 August 2019, the court made orders by consent as to disclosure.  The affidavit put in issue the alleged shifting positions put by the respondent as to his capacity to obtain records from Sri Lanka, and complained of the respondent’s failure to comply with the orders made on 19 August 2019.  The first order made on that date was:

    Within 48 Hours of these orders being made the respondent shall attend the office of his solicitor with all log-in and password details for his accounts with any bank not based in Australia.

26. The affidavit noted the explanation provided by the solicitor for the husband that the husband did not have access to online facilities.  That matter was put in issue.  Vivid complaint was made of the ongoing failure of the husband to make disclosure.

27. The husband, unsurprisingly, responded by an affidavit filed on 22 October 2019.  He deposed that he did not have online banking facilities with either the M Bank or the L Bank and could not log-in or get password details.  He deposed to his endeavours to obtain such online passwords and as to his failure to obtain these from the L Bank in Sri Lanka.  A purported refusal on the part of the M Bank was annexed at “H-3”.

1. He deposed as to the difficulties he was undergoing in his endeavours to obtain further details.  He did depose that he had been informed he had two other accounts in Sri Lanka, which he said he had forgotten, and went on to depose to his continuing endeavours to obtain details.

2. The wife responded again by further affidavit filed 24 October 2019.  I note that she responded to an assertion by the husband that he became an Australian citizen in 2009 and is therefore not a Sri Lankan citizen and does not obtain dual citizenship, this being an inhibitor for obtaining access to a Sri Lankan bank account.  The wife, however, exhibited as annexure “H1” a copy of the husband’s dual citizenship certificate.  She also pointed to the fact that the applicant had told his solicitor in August 2019 that he would need to go to Sri Lanka in person to set up internet banking, when in fact he had been there in July 2019 and could have done anything necessary to access his accounts.

3. The husband responded on 24 October 2019.  At paragraph 2, he deposed:

   At paragraph 4 of my affidavit of 22 October 2019, I stated that I did not obtain dual citizenship.  I remember having applied for dual citizenship, but I never followed it up.  As far as I was aware, it was not granted.  I do not recall having seen the document called “Dual Citizenship Certificate” attached to Ms Hansi’s affidavit at annexure H1 before.  I do not have this document in my possession.  I do not know if this document is authentic, and I ask that Ms Hansi produce the original document to me.  As previously stated in my affidavit of 11 April 2019, I have memory loss and find it difficult to concentrate for long periods of time.

4. The affidavit went on to depose as to his ongoing difficulties in obtaining access to his accounts in Sri Lanka.

5. The wife filed a trial affidavit on 27 March 2020.  Unsurprisingly, it is largely a repeat of earlier materials.  I note that at paragraph 11, she dealt with the migration to Australia and asserted that the parties owned substantial assets before that migration.  She annexed as “H1” a true copy of the migration application.  I note that at question 28, under the heading, Your Main Language, English was provided and it was described as better than functional for both applicants (i.e. the husband and the wife).  I note that in response to question 32:

   What is the value of money, goods and assets which you (and your spouse) intend to bring to Australia? –

   the answer was 32.5 million rupees, described as Australian equivalent $500,000.  It is clear, in fact, that this passage referred to the husband alone (see page 26 of 74 of the affidavit).  The document was plainly signed by the husband (see page 34 of 74 of the affidavit).

6. The wife went on, as it were, to upgrade the $500,000 to an asserted present value of just under $2 million, and repeated again the husband’s alleged failures to disclose.  I note that the house in C Street, Suburb D was ascribed a value of $575,000 with a home loan of $263,000.  I further note that the wife has $36,900 in the bank, “including her former superannuation account which was cashed in on retirement as per recent balance”, which seems a little surprising given that it was $63,000 when she filed her financial statement.

7. The husband filed a further affidavit on 18 June 2020.  He denied having any monies in bank accounts in Sri Lanka.  He deposed to the sale of the property in Sri Lanka for 22.5 million rupees.  He sought a 50/50 division of the parties’ properties, and for the first time, asserted loans to his brother of $20,000.  The affidavit appended again affidavits from Mr O, the purchaser of the Sri Lankan property, and the affidavit from Mr P to which reference has already been made. (It also appended a without prejudice letter from the wife’s solicitors to which I have paid no regard).

8. The husband filed yet a further affidavit on 22 June 2020.  It was not, as indeed was the previous one, in proper form as he is no longer represented.  It is predominantly designed to prove the costs of the holiday in 2016 and monies advanced to the wife to buy a car in 2016, together with materials relating to his superannuation and common law claim.

9. On 3 July 2020, the husband filed yet a further affidavit which in my view takes the matter no further. 

10. It is readily apparent that the parties have been indefatigable deponents, but in a general sense, the matters of controversy raised before them are repeated rather than further explained.

The Submissions Made and Evidence Given at the Court

1. What follows is taken from my notes. 

The Opening and Evidence of the Wife

1. Counsel for the wife opened the case and said there were three aspects to it.  It was a marriage of 40 years with two adult children.  The parties migrated to Australian in 2003, and at that time, the declaration of assets revealed $500,000.  There is no evidence to suggest any money came across to Australia, and there has been no disclosure.  In 2016, the home in Sri Lanka was sold but the money was not transferred to Australia to pay the mortgage.  Even if the lower figure for sale was accepted, there is no evidence as to what happened to it.  It is still under the husband’s control.  She seeks the whole of the matrimonial home.  She seeks that various costs previously reserved be paid and seeks her costs for the proceeding.  Counsel noted the husband’s non-disclosure.  She referred to orders made by Registrar Riddiford on 19 August 2019 and 25 October 2019.  The husband had travelled to Sri Lanka and there was no reason for his non-disclosure.

2. The wife was called and adopted her affidavits as true and correct.  She is now retired. 

3. Under cross-examination by the husband, who was self-represented, the wife conceded that they arrived in Australia in 2005.  She said everything in Sri Lanka was under the husband’s control and in his name.  She only knew what he told her.  After they lodged their joint application to migrate, their activity is in Australia.  They bought a property in Suburb Q.  The details are in her documents.  She had agreed that there were joint assets, but said everything was in the husband’s name.  He was the one who handled everything.  Assets were in his name.

4. It was put that the price of the sale of the property in Sri Lanka had been dropped.  The wife said she only knew it was sold for 37 million rupees.  He had asked for 40 million, but the agreement was for 37 million.  The documents have been sent.  When it was put to her that she had subpoenaed his accounts, the wife said, “Only in Australia.”  She had not seen any money in Sri Lanka or the proceeds of sale. 

5. Cross-examination was fairly brief, and there was no re-examination. 

The Opening and Evidence of the Husband

1. The husband said he disagreed with the lady lawyer.  She had said he was dishonest about his Sri Lankan bank accounts.  He said he was quite open about all details.  Also, he completely did not agree with their claim that bank statements were forged.  They were genuine documents.  He referred to their letter at “H-5”.  It was the M Bank.  They sought bank details.  Therefore, they wanted a subpoena.  They did not inform him what he had done wrong about the bank statements, so he would like the other party to point which documents he had forged.  They did not have clear grounds.  His wife had had a divorce which ended a 41-year marriage.  She is asking for money from him.  He does not have money.  He is staying with his son at the moment, and there is an Intervention Order against him.

2. The husband was affirmed and adopted his affidavits as true and correct.  The husband was challenged about the alleged non-disclosure of his accounts in Sri Lanka in his financial statement.  He denied any incompleteness and asserted that he was very clear about the money he received when he sold the property in Sri Lanka.  When it was put to him that his assertion that his disclosure of his accounts in Sri Lanka was false, he responded, “Prove it.” 

3. When it was put to him that there were no bank statements detailing the sale prices from Sri Lanka, he said he had given them to his lawyers.  They had submitted them to Mr Galloway (solicitor for the applicant), who said that they were not genuine and forged.  He had been to Sri Lanka and obtained his statements.  He wrote to the bank and they posted copies of the statements.  Then in 2019, he went to Sri Lanka.  They said his documents were still disingenuous, and they issued subpoenas.  His former lawyers had forwarded all the bank documents. 

4. When it was put to him that his bank statements from 2016 had not been disclosed, he disagreed.  It was put to him that the reason he said the price of sale was 22 million rupees was to minimise stamp duty.  The husband said this had been discussed previously.  The original agreement with the buyer was about $35 million.  After he went to Sri Lanka, the buyer was in Country R.  He claimed that the property was close to City G cemetery and so he did not agree to the original price.  At the time, he was quite desperate.  He was retired.  He had a back injury and really wanted to sell.  He had to agree to reduce the price to 22.5 million rupees. 

5. When taxed with the statement from City S Property at page 41 of the wife’s trial affidavit, the husband said that attachment was provided by the wife’s nephew.  It is her sister’s son.  When it was put to him that there was an attempt to evade stamp duty, the husband completely disagreed.  He recalled the original approximate $35 million price, but for the reasons given, it was reduced to $22.5 million.  He said that what was being suggested was against the law.  When it was put to him that the original contract ended up with a reduced price, he said he had provided these documents to the judge earlier.  He said the price was verbally agreed and things changed after he went to Sri Lanka.  He had to amend it.  The sales agreement 140 was from May or June 2016 and was the final agreement.

6. It was put to the husband that there was no loan from his brother in the financial statement.  He said he borrowed money in 2018 and 2019.  He borrowed cash in 2018 and 2019.  The financial statement only mentioned money deposited in 2016.  There was no need to refer to other borrowings.  There was no reason to mention it.  He borrowed from his mother.  He has to return this money.  These are personal matters.  He borrows from his son.

7. The husband was cross-examined about the application in 2003.  He said it was a joint statement.  He said that both he and his wife and their son had applied for the visa.  When it was put to him that this disclosed $500,000, he said it was goods and assets.  They had to pay the department big money because they were aged parents.  He conceded the figure of 691,000 rupees in his accounts with M Bank in 2003, as set out at page 63 and 74 of the wife’s trial affidavit.  When he was asked when he transferred these funds to Australia, the husband gave no direct answer.  It was put to him that he had left the funds in Sri Lanka.  He said he wished he could remember.  It was 17 years ago.  He appeared to suggest that the monies were ultimately transferred to Australia.  He provided all the documents to the wife’s lawyer, but they were not accepted.  They were said to be forged.

8. I would interpolate and say that these answers were unbelievable and had all the appearance of being made up on the run.

9. When cross-examined about “H-3” to his affidavit of 16 August 2019, the husband said the figures were in Australian dollars.  When it was put that there was no deposit of the sale proceeds of 2016, he referred to the $49,997.  He said to look at the L Bank records.  He said he had borrowed money, so he had to pay.  He had other commitments.

10. It was put to the husband that this was not in his affidavits, but he said he did.  It was referred to in the affidavits.

11. It was put to him that there was no bank in Australia showing withdrawals, and that the money was still sitting there.  The husband said, “I think you have seen the subpoenaed records.  It is in the CBA.  I don’t have to answer this question.”

12. The husband went on to refer to the attachments to his affidavits.

13. It was put to the husband that the wife asked him to bring the money to Australia to pay the mortgage and he refused.  The husband did not in fact respond to the question directly.  He said originally he expected 35 million rupees, but unfortunately, it was only about 22 million rupees.  He intended to bring dollars to Australia.  That is what he did after settling his debts.  The rest of the money went to his Australian account.

14. It was put that the home in Suburb K had to be sold.  He said the first mortgage was about $500,000 with NAB.  It was a huge mortgage.  The maximum they could pay would be $100,000 from Sri Lanka.  It was pointless to invest this to pay off the mortgage.  And therefore, they realised they had to downsize and purchase C Street, Suburb D.

15. When it was put that these latest remarks were not in his affidavits, the husband was non-responsive.  He said he had to pay $30,000 for his son’s University and K School fees.  These were not HECS.  K School was a private school.  He said the wife had only arranged reduced fees for about six months. 

16. When it was put to him that his migration application suggested his first language was English, the husband said this might be right.  He said his mother tongue is Sinhalese, but he is fluent in English.  He completed the application to the best of his ability.  He conceded that he and the wife talked mainly in English.

17. I offered the opportunity to the husband to clarify any matters for me at the cessation of cross-examination.  The response was not easy to understand.  The husband said that the main allegation was that he was dishonest and had hidden money in foreign banks, which he completely denied.  He said that the Court has access to all his bank accounts in Sri Lanka and Australia.  He told the wife to prove her case.  He said he had subpoenaed and obtained the details.

18. In final submissions, counsel pointed to the material non-disclosure alleged.  No bank accounts show where $500,000 went.  It never came to Australia.  They sold the home in 2016 and the amount was 34,890,000 rupees.  The registration transfer 140 was not even stamped.  It was an attempt to reduce stamp duty.  The affidavit of the purchaser in the court book was sworn at the time of the transaction.  There was no evidence money came to Australia.  The husband retains all the monies earned that he has not disclosed.  There had been no compliance with orders for affidavits by the respondent’s solicitor and himself.

19. In final submissions, the husband denied non-disclosure.  The full amount of the sale of the house was put in the bank and transferred to Australia.  Not all of it was transferred because there were debts to be paid.  They said his accounts are dodgy, but she never said she would divorce him.  There was no reason to hide things from him.  She was in Sri Lanka in June 2016.  He sought a 50/50 division.

Brief Observations about the Witnesses

1. The wife was a composed witness whose answers were not moved by any of the questions put to her by the husband. 

2. The husband was at times voluble.  Understandably, perhaps, he was more so when he was speaking in Sinhalese through the interpreter.  He was in the habit of giving non-responsive and self-serving answers.  Some of his answers were, I regret to say, completely unbelievable.  This was most particularly obvious, I think, when he was being cross-examined about his 691,000 rupees.  He failed to answer directly at first, and then said he could not remember.  These were on any view of the matter substantial amounts of money and making every allowance for the husband’s age and health difficulties, I found what he said and the way that he said it completely unbelievable.  As I have said, some of his answers were made up on the run and his answers increasingly became rambling and self-serving as cross-examination continued.

Stanford v Stanford [2012] HCA 52

1. The Court’s first job is to ascertain the legal and equitable interests of the parties in determining whether a property adjustment is appropriate.  Both parties seek a property adjustment, and in this case, it is plain there should be one.  The question of what the parties’ legal and equitable interests are is, however, far more difficult. 

The Pool

1. The only asset of any real moment owned by the parties is the matrimonial home with a value of some $575,000 and a mortgage of $263,000.  The husband has used up, one way or the other, all of his $40,000 payment arising out of his injury (this figure is supported by the solicitor’s correspondence, and I accept it) and also his superannuation.  The wife has drawn down her superannuation and while she has $36,000 in the bank, that is all she has.  I would infer that she will have to pay substantial legal costs, in any event.

2. The real question is what happened to funds in Sri Lanka? 

3. The husband was keen to say that the migration form only referred to $500,000 of cash and assets.  He seemed to imply that the use of the phrase “and assets” meant that there did not have to be $500,000 in specie.  That is of course true, but to the extent that he may have been seeking to suggest that the $500,000 included the value of the matrimonial home in Sri Lanka, that is plainly incorrect.  The migration application plainly contemplates the transfer of assets to Australia in order, as it were, to justify the issuing of the visa.  The property in Sri Lanka was not sold until 2016 and the proceeds were never transferred to Australia, save as to approximately $90,000.

4. Even in 2016, the property in Sri Lanka was only worth at an absolute maximum about $300,000 on the wife’s version.  There must have been other assets and funds in Sri Lanka unless, as is indeed entirely possible, the migration application was untrue.  As I find, doing the best I can in an evidentiary wasteland where the truth is all but impossible to discern, the husband had relatively substantial other assets in Sri Lanka including the sum of at least 691,000 rupees in 2003.  Those assets remained under his sole control at all material times and appear to have been dissipated by him over time.

5. I strongly suspect that the migration application was, in part, simply untruthful.  There were some funds in Sri Lanka but more probably than not, nowhere near $500,000. There is nothing in the parties’ materials that suggests they had been able, by in 2003, to amass so large an amount.  Nonetheless, the only reason I am unable to say how much there was in excess of the 691,000 rupees is the lack of evidence provided by the husband.

6. That brings us to the vexed question of the sale of the Sri Lankan home.  There is no question that one or other of these parties has produced forged documents.  The wife has asserted that it is not difficult to obtain forged documents in Sri Lanka, and that assertion accords entirely with my understanding of the matter based on a long history of hearing migration cases from Sri Lanka in which reports to this effect have been substantiated.

7. I am not able to say with any certainty what the sale price of the property in Sri Lanka was.  The husband’s explanation for the diminution in price has about it one level of attraction.  It is at least internally consistent.  What is not clear, however, is quite why it was so desperately necessary to sell quickly in 2016.  The parties were living in Australia.  He had recently had the benefit of a $40,000 net payment to him of injury entitlements.  There is nothing to suggest that the parties were not then meeting their bills. None of the funds from the sale other than about $90,000 were transferred to Australia and even then none were applied to the Suburb K mortgage. A diminution in price amounting to almost 50 per cent is inherently incredible.  The documents asserting the higher price are not reconstructions later, but appear to be documents from the time of the sale.

1. In the end, I think the higher price posited by the wife is the true one. I have heard the husband’s version and I do not believe him. What is clear, moreover, is that whatever the price of sale was, the husband kept all of it.

2. I roundly and completely reject the husband’s assertion as to the expenditure of the funds to the extent that it is in issue.  It is true some funds may have been spent on a holiday to America, but that holiday was relatively contiguous also to the receipt of the $40,000 WorkCover payment. 

3. Furthermore, while it is clear that funds may well have been advanced to their son from time to time, the husband has in my view comprehensively failed to prove the figures for which he contends.  I am reinforced in this by the fact that I found the wife to be an altogether better witness, and I am inclined to entirely accept her assertions as to the various disbursements that are in issue.  I am further reinforced in this finding by the fact that the husband’s evidence about alleged loans from his brother was given at the absolute death knock of the case and had all the appearance of being made up on the run, as I have no doubt it was. Further again, the husband’s denial of his dual citizenship is ridiculous.

4. I further find that this is a case in which the husband has comprehensively failed to disclose.  The litany of complaints made by the wife are in my view made out.  The husband entered into consent orders and then simply failed to comply with them for reasons which I find completely unpersuasive.  Once again, the wife’s criticisms are ones I accept.

5. Taken together, all this means that the court is entitled to take a more robust approach to the matter, as the Full Court determined in Chang & Su (2002) FLC 93-117. Kaye and Dawe JJ in which Finn J agreed relevantly said at [70]:

   70.    In Weir v Weir (1993) FLC 92-338;16 Fam LR 154 the Full Court (Nicholson CJ, Strauss and Nygh JJ) dealt with an appeal against the refusal by the trial Judge to make orders in respect of unascertained property because he could not quantify it.  The Court said at 79-593:

"This Court has pointed out in a line of cases leading up to the recent decision of the Full Court in Black and Kellner (1992) FLC 92-287, that it is the duty of a party involved in property proceedings in this jurisdiction to make a full disclosure of their financial affairs. See also Giunti and Giunti (1986) FLC 91-759, and Mezzacappa and Mezzacappa (1987) FLC 91-853. It is clear enough from his Honour's findings in the present case that the husband had not done so and had in fact pocketed the proceeds of a substantial number of cash sales. It is obvious that in most cases of this nature it is difficult enough for the other party to establish that fact let alone establish the quantum of what has been taken. 

It seems to us that once it has been established that there has been a deliberate non-disclosure, which follows from his Honour's findings in this case, then the Court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature. 

1. It is clear from the terms of the judgment that Kaye and Dawe JJ endorse that approach.

2. Thus, in my opinion, the pool effectively consists only of the equity in the matrimonial home (just over $300,000). The wife has a car which may have been paid for out of joint funds, but in effect, it merely gives her a means of locomotion – it is not an asset she can realise.  The $36,000 she has in the bank is effectively her superannuation.

3. I am not minded to add back the sale proceeds of the Sri Lankan home or the unquantifiable funds that I have found the husband retained in Sri Lanka post-2003 (in the case of the latter, not least precisely because they are unquantifiable).  These are matters which in my view fall to be considered in the overall determination of providing a just and equitable settlement.

Contribution

1. These parties were married for 41 years.  I do not accept the husband’s evidence that he made a greater initial contribution.  The wife’s evidence was generally more cogent, and I accept it.  The parties had nothing of any moment at the commencement of the relationship, at which time the wife was employed as a public servant and the husband as some form of professional.  Through their joint efforts, they were able to buy land and build on it in City G.  There is nothing to suggest that over the 41 years of the relationship, the parties’ contributions were not equal, although I note that the wife plainly not only worked for substantial periods of time but also had the primary child-rearing responsibilities. 

2. Ordinarily, one would have assessed the parties’ contributions as equal, but the fact that the husband has retained all of the Sri Lankan funds is of course very significant.  I repeat that I am not able to say whether the husband still has substantial amounts of funds in Sri Lanka.  He may or he may not.  Nonetheless, whatever funds there were, and there were certainly well in excess of $300,000, they have all been retained by him and either retained in Sri Lanka sub rosa or spent by the husband for his own benefit.

3. It should be noted that over $300,000 at least of such funds were obtained in mid-2016, only four years ago. The husband’s assertion in part that the funds not brought to Australia were spent by him on living expenses in Sri Lanka is wholly unpersuasive.  Of the $90,000 brought to Australia, it is plain that the husband has retained it to his own benefit and spent it.

Future Needs Factors

1. The husband suffers from ill health, but so does the wife.  They are both on the aged pension and there is nothing to suggest that in any broad sense their future needs are sufficiently different to suggest any adjustment is appropriate. 

Just and Equitable

1. Thus far, I have followed the so called four-stage step indicated by the authorities.  It is not a mandatory pathway (see Baglio v Baglio [2013] FamCA 105 per Murphy J at [180]-[181]) but it is often helpful in coming to the assessment as to what is in truth a just and equitable outcome.

2. In the particular circumstances of this case, I have no doubt that the just and equitable outcome is that the wife retain the matrimonial home and other chattels in her position and that the husband retain his. The husband’s failure to disclose has been lamentable. He has had substantial funds to his benefit and has either simply dissipated them almost entirely to his own benefit or retained them and not revealed where they are. These are matters properly given appropriate weight pursuant to section 75(2)(o) of the Act.

3. While at first blush it might seem strange that the wife should obtain the only significant asset of the relationship in circumstances where the parties were married for so long a time and their contributions and future needs are equal, even a more conventional application of the standard 4 step methodology would produce something very much in the same result. If I were to add back the in excess $300,000 from the sale of the property in Sri Lanka, together with the unquantifiable (I repeat only because of the husband’s non-disclosure) additional assets he had in Sri Lanka, the reality is that the parties would be receiving roughly an equal amount in any event. This consideration only goes to reinforce my view that in the circumstances of this case the just and equitable requirement leads inexorably to the conclusion that it is just and equitable that the wife receive the matrimonial home, together obviously with its mortgage to the exclusion of the husband.

4. Although it puts the matter shortly, that is my view of this case and I will make orders accordingly.

5. I note that the wife has sought her costs, including reserved costs. I will hear further from the parties about this aspect of the matter.

I certify that the preceding one hundred (100) paragraphs are a true copy of the reasons for judgment of Judge Burchardt

Associate: 

Date: 5 August 2020