Harcourt & Costin
[2022] FedCFamC2F 1053
Federal Circuit and Family Court of Australia
(DIVISION 2)
Harcourt & Costin [2022] FedCFamC2F 1053
File number(s): ADC 3535 of 2019 Judgment of: JUDGE DICKSON Date of judgment: 11 August 2022 Catchwords: FAMILY LAW - Property – long marriage – difficult and protracted litigation history – add backs – withdrawal of funds from off set account by both parties post separation - where contributions during the relationship were equal – where husband has made minimal effort to pay the mortgage post separation and has had unfettered use of the former matrimonial home while wife has had to rent - wife has made significant post separation contributions which warrant an adjustment in her favour – future needs –wife to receive an adjustment for her continued care of the youngest child of the relationship – application for sole trustee for sale of former matrimonial home by wife – where on the basis of the husband’s conduct in these proceedings the wife should be permitted to sell the parties’ properties as sole trustee – justice and equity Legislation: Family Law Act 1975 (Cth) Pt VIII ss 75, 79
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 12.06
Cases cited: Stanford & Stanford (2012) 247 CLR 108 Division: Division 2 Family Law Number of paragraphs: 162 Date of hearing: 12 May 2022, 28 June 2022 and 14 July 2022 Place: Adelaide Counsel for the Applicant: Mr Bowler Solicitor for the Applicant: Johnston Withers Respondent: Appeared in Person ORDERS
ADC 3535 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS HARCOURT
Applicant
AND: MR COSTIN
Respondent
order made by:
JUDGE DICKSON
DATE OF ORDER:
11 AUGUST 2022
THE COURT ORDERS THAT:
1.The real estate properties, being the whole of the land comprised in Certificate of Title Register Book Volume … Folio … described as B Street, Town C (‘the B Street, Town C property’) and Volume … Folio … being the property at D Street, Town E (‘the D Street, Town E property’) hereinafter referred to together as "the properties" be sold forthwith, and for that purposes the wife is appointed as Trustee (‘the Trustee’) for the sale of the properties.
2.In the event that the husband fails, refuses or neglects to execute any document necessary to implement the terms of these orders and to deliver them to the solicitors for the wife as requested then upon proof by affidavit of such failure, refusal or neglect within 7 days a Judicial or Deputy Registrar of the Federal Circuit and Family Court of Australia is appointed pursuant to section 106A of the Family Law Act1975 (Cth) to execute any such document and do whatever acts and things that may be necessary to give validity and operation to the terms of these orders.
3.The Trustee sell the properties by private treaty or by public auction as she may be advised by the real estate agent selected by her subject to the following provisions:
(a)The offering price or reserved price in relation to the D Street, Town E property not be less than the sum of $150,000.00;
(b)The offering price or reserved price in relation to the B Street, Town C property not be less than $300,000.00;
(c)The Trustee may incur advertising expenses in relation to the properties up to the amount of $5,000.00 with respect to each property;
(d)The Trustee may incur costs for the purposes of redecorating or improvement of the presentation of the properties for the purposes of the sale to such amount as may be advised by the agents acting on the sale but not exceeding the amount of $2,500.00 for each property unless the parties agree in writing;
(e)The Trustee may retain Mr F of Company G for the purposes of acting as the agent for the sale of the D Street, Town E property;
(f)The Trustee may retain Ms H of J Property for the purposes of acting as the agent on the sale of the B Street, Town C property;
(g)The Trustee may enter into appropriate Agency Agreement with respect to an agent at an agreed sales commission of 2.7% or less for each of the properties;
(h)The Trustee may retain a solicitor and/or conveyancer of her choice to act for the Vendor on the sale;
(i)The Trustee is authorise to enter into a Contract for Sale on such terms as advised by the solicitors acting upon the sale;
(j)Liberty to apply to the Court be reserved to the Trustee to apply to the Court in respect of the terms and conditions of the sale for further directions in the event that it proves necessary;
(k)Upon completion of the sale of each of the properties the proceeds of sale shall be distributed as follows:
(i)In payment of the agent's commission on sale;
(ii)The amount required to discharge any existing mortgage;
(iii)The amount required for normal conveyancing adjustments as to municipal and water rates on sale;
(iv)The amount required to discharge the wife’s personal loan with Bank AD;
(v)Such sum to the Johnston Withers Trust Account for and on behalf of the wife representing SIXTY PERCENTUM (60%) of the parties total net non-superannuation assets after bringing to account the assets to be retained by the wife valued at $6,000.00;
(vi)The balance remaining to the husband.
4.The wife do otherwise retain as her sole property free from all claim and demand by the husband ;
(a)Her Motor Vehicle 2;
(b)Her furniture and effects;
(c)Her personal savings and investments; and
(d)Her superannuation entitlements with K Super Fund;
5.The husband do otherwise retain as his sole property free from all claim and demand by the wife:
(a)His Motor Vehicle 1;
(b)His Furniture and effects;
(c)His Tools;
(d)His Company L and Company M shares;
(e)His Personal savings;
(f)His Boat; and
(g)His superannuation entitlements with N Super Fund subject to paragraph 7 herein.
6.The parties do indemnify each other and keep each other indemnified in relation to any liability incurred in their sole name.
7.In relation to the husband's (MR COSTIN) superannuation entitlements with N Super Fund member number … paragraphs 7(a), 7(b), 7(c), 7(d) and 7(e) (inclusive) herein are binding on the Trustee of the N Super Fund, ("the Fund"):
(a)The court allocate as required by section 90XT(4) of the Family Law Act 1975 ("the Act") a base amount of ONE HUNDRED THIRTY FIVE THOUSAND NINE HUNDRED AND NINETY ONE DOLLARS ($135,991.00) to the wife out of the husband's entitlement in the Fund.
(b)Pursuant to 90XT(l)(a) of the Act whenever the Fund makes a splittable payment out of the husband's interest in the Fund the Trustee shall:
(i)pay to the wife (MS HARCOURT) or to her legal personal representative the entitlement calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001 using the base amount specified at paragraph 7(a); and
(ii)make a corresponding reduction in the entitlement the husband would have had in the Fund but for this Order.
(c)That paragraphs 7(a) and 7(b) of these Orders have effect from the operative time.
(d)The operative time for the purposes of Order 7(c) of these Orders is four (4) business days after the date of service of these orders upon the Trustee of the Fund.
(e)That the Trustee of the Fund shall do all such acts and things and sign all such documents as may be necessary so that in accordance with the obligations set out under the Act and Family Law (Superannuation) Regulations 2001 the Trustee can calculate the entitlement of and make payment to the wife in accordance with paragraph 7 of these Orders.
(f)That the wife shall do all things necessary including but not limited to exercising her request pursuant to Regulation 7A.06(1) of the Superannuation Industry (Supervision) Regulations 1994 for the rollover or transfer of the transferable benefit out of the husband's interest in the Fund to a fund nominated by the wife in accordance with Regulation 7A.12 of the Superannuation Industry (Supervision) Regulations 1994.
(g)In the event that the superannuation split to the wife pursuant to these Orders can be rolled over into a separate account to the wife each of the parties do all such acts and things and execute all such documents as may be necessary to facilitate and to implement that rollover.
(h)That pursuant to Regulation 14F of the Family Law (Superannuation) Regulations 2001 any payment from the husband's superannuation interest made after the Trustee has rolled over or transferred the transferable benefit to a fund nominated by the wife is not a splittable payment.
8.The parties shall comply with all reasonable advice and direction provided by the selling agent or agents for the said B Street, Town C property and the said D Street, Town E property including the mode of sale, any work required to prepare the said properties for sale and open inspections.
9.The husband shall comply with all reasonable requests made by the wife as Trustee and/or the sales agent in relation to the sale of either or both properties, including making the property available for open inspections or any appointments required for the purpose of selling the said properties in accordance with the orders set out herein.
10.The husband shall pay all outgoings for the B Street, Town C property pending sale.
11.The husband shall ensure that the B Street, Town C property is maintained and presented in a clean and tidy state prior to all open inspections.
12.All extant applications be dismissed.
13.Each party bear their own costs of and incidental to these proceedings.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym Harcourt & Costin has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE DICKSON:
INTRODUCTION
These proceedings concern applications for property settlement.
These are the Court’s reasons in relation to the parties’ competing applications for property settlement.
RELATIONSHIP BACKGROUND
The wife Ms Harcourt (‘the wife’) was born in 1973 and is aged 48 years. The respondent husband Mr Costin (‘the husband’) was born in 1962 and is aged 60 years.
The parties commenced a relationship in 1992 and thereafter cohabitated for about six months after which the husband moved into the wife’s rented unit.
In 1993, the parties purchased a car and caravan and went travelling. They lived in Western Australia from around 1993 to 1998.
The parties married in 1998 at Location O, near Town P in South Australia.
The parties had three children of their marriage, namely Ms Q born in 2001, Ms R born in 2003 and X born in 2006. X is the only child of the relationship who has not reached an age of majority. He is currently 16 years old and lives full time with the wife.
The parties travelled to Darwin in 1999, where both parties lived in the Town Y Caravan Park. They then moved to City Z in Queensland, where the wife became pregnant with their first child. When the wife was seven months pregnant, they moved to the Region AB in South Australia with the wife’s sister. The parties lived with the wife’s sister until shortly before the birth of the parties’ first child Ms Q, when they moved in with the wife’s parents at Town P.
When Ms Q was three months of age, the parties moved to Suburb AC, as the husband had obtained work at Suburb AN. They remained living at Suburb AC until they moved to B Street, Town C in 2003. The parties rented in B Street, Town C before purchasing the former matrimonial home in joint names at B Street, Town C in 2006 (‘the former matrimonial home’).
The former matrimonial home was purchased for the sum of $228,000.00 using a deposit of $7,000.00 from joint savings, the First Home Buyer’s Grant and a loan from Bank AD.
In or about 2007, the parties purchased a property at D Street, Town E (‘the D Street, Town E property’), utilising the equity in the former matrimonial home. The D Street, Town E property was purchased for the sum of $120,000.00. The D Street, Town E property was developed to include the planting of fruit trees and the installation of a large shed, which doubled as living accommodation for family holidays.
The wife was a stay at home mother caring for the children until 2009 when she returned to work on a part time basis. After six months of working part time, the parties purchased the business “Company AE” for the sum of $50,000.00, borrowed from Bank AD.
In or about 2015, the parties undertook renovations to the former matrimonial home. The parties, with the assistance of friends and family, connected the rumpus room to the house and two further bedrooms and a second bathroom. The parties funded the renovations using funds received by the wife from Centrelink in the sum of $30,000.00, which was paid retrospectively for unpaid Family Tax Benefit.
The parties separated on 17 June 2017, on which date the wife left the former matrimonial home.
At separation, the wife vacated the former matrimonial home with the three children and moved into a rental property paying $380.00 per week.
There is no dispute between the parties that the husband has spent very little time with the children since separation or at all since 2020.
The wife presently works as a self-employed beauty therapist. The husband now works as a tradesman, but has qualifications as a tradesman.
Five years post separation, the parties are yet to finalise their property settlement.
HISTORY OF PROCEEDINGS
The history of the litigation is set out hereunder because it has relevance as to the final orders which will be made acceding to the wife’s application that she be appointed as sole Trustee of for the sale of the said properties. As will become evident, the matter has had an unnecessarily protracted pathway through the Court with the wife alleging that the husband has deliberately failed to engage so that he may remain living in the B Street, Town C property, whilst the wife pays private rental for herself and the parties’ children.
The wife filed her Initiating Application on 20 August 2019. The wife’s Initiating Application first came before his Honour Judge Cole on 21 October 2019 when his Honour made the following orders and notations:
UPON NOTING THAT:
A. The matter was called in the precincts of the Court and there being no appearance by or on behalf of the respondent,
THE COURT ORDERS THAT:
1. The respondent file and serve his responding documents within sixty (60) days.
2.The wife solicitors serve copy of these orders upon the respondent by way of email (if known) and registered post.
3.In the event the respondent fails to comply with paragraph 1 hereof the wife have leave to apply to proceed on an undefended basis on the next occasion.
4. The proceedings are adjourned to 24 February 2020 at 9:15am for directions.
5. The wife’s costs of today are hereby reserved.
On 8 January 2020, the respondent filed a Notice of Address for Service which noted Adelaide Family Lawyers as his solicitors.
On 21 February 2020, the respondent filed his Response to Initiating Application with a supporting affidavit and Financial Statement.
The matter next came before Judge Cole on 24 February 2020 when the following notations and orders were made:
UPON NOTING the wife has foreshadowed seeking an argument time in respect of the husband’s failure to pay the mortgage in respect of the sale of the [D Street, Town E] property,
THE COURT ORDERS BY CONSENT THAT:
1. Within twenty eight (28) days the parties provide mutual and informal discovery of all documents in their respective custody and control.
2. With respect to any asset the value of which is not agreed, the parties agree to a joint written valuation at their joint expense to be available at least fourteen (14) days prior to the Conciliation Conference.
3. The parties are restrained and an injunction is hereby granted restraining each of them from disposing of, encumbering or otherwise dealing with any assets in his or her sole name or the joint names of the parties.
4. The parties attend a Conciliation Conference with a Registrar of the Federal Circuit Court of Australia on 17 April 2020 at 11.00am.
5. The wife pay the Conciliation Conference fee in accordance with the Family Law (Fees) Regulation 2012 at least twenty-eight (28) days prior to the Conciliation Conference unless otherwise exempted from payment.
6. The respondent reimburse the wife one half of the Conciliation Conference fee within fourteen (14) days thereafter.
7. All valuations or any other relevant documents that the parties wish to rely upon be exchanged fourteen (14) days prior to the Conciliation Conference.
8. Further consideration of the proceedings is adjourned to 21 April 2020 at 9.15am.
9. The wife’s Costs of today be reserved.
On 1 June 2020, the husband’s solicitors at the time, being Adelaide Family Lawyers, filed a Notice of Withdrawal as Lawyer.
On 3 June 2020, AF Law Firm filed a Notice of Address for Service confirming that they were acting for the husband in these proceedings.
On 17 June 2020, the matter again came before Judge Cole who made orders for the further informal exchange of disclosure within 14 days and for the parties to attend an informal ‘without prejudice’ conference with their legal representatives on 14 August 2020. The proceedings were adjourned to 2 September 2020 for directions.
On 2 September 2020, the parties’ solicitors appeared before Judge Cole and a notation was made on the orders that the parties have reached agreement and the wife’s solicitors were preparing the minute. The matter was adjourned to 13 October 2020 for the making of consent orders.
At the hearing on 13 October 2020, interim consent orders were made as follows:
THE COURT ORDERS BY CONSENT THAT:
1.Within twenty-one (21) days the wife and respondent shall do all acts and things and sign all necessary documents to effect the sale of the property located at:
1.1.[B Street, Town C] in the State of South Australia (“the [B Street, Town C] property”);
And for that purpose the following shall apply:
1.2.The [B Street, Town C] property shall be listed for sale on such terms and conditions and with such agent as agreed within 21 days by the parties and in default of agreement as recommended by the President of the Real Estate Institute of South Australia.
1.3. The parties are to co-operate in every way with the real estate agent in relation to the marketing of the property for sale including making the key readily available, allowing inspection of the property at all times reasonably requested by the agent and ensuring that the property is clean, neat and in good order at the time of inspection by any prospective buyer.
1.4.The respondent husband do forthwith commence paying the mortgage periodic payments in such amount as required by the financier on the [B Street, Town C] property.
1.5.Upon the sale of the [B Street, Town C] property the net proceeds of sale after payment of the costs of sale and the mortgage be invested in a joint interest bearing account pending final Order or agreement of the parties.
2. The proceedings are adjourned to 12 February 2021 at 9:30am for directions.
The matter did not come back before his Honour on 12 February 2021. Instead, the matter was heard on 15 March 2021 when his Honour noted that the wife would be filing an Application in a Case and it would be assessed in Chambers. The proceedings were adjourned to 1 June 2021 at 9:15am.
The wife filed the foreshadowed Application in a Case (as they were then known) on 28 May 2021. In the said Application, the wife sought orders as follows:
1. That the respondent husband vacate the property at [B Street, Town C] in the State of South Australia ("the said property") within fourteen (14) days of the date of this Order.
2. That the wife be solely responsible for the marketing and sale of the said property.
3. That the respondent husband continue to pay the mortgage instalments on the said property as and when they become due until the date of settlement of the sale of the said property
4. The respondent husband do pay the costs of and incidental to this application.
5. Such further or other order as this Honourable Court deems fit.
The first return of the wife’s Application in a Case came before his Honour on 1 June 2021. At that date, the husband had not filed any Response, however noting that the wife’s application was only made some three or so days before the hearing. His Honour made orders that the husband file and serve responding documents within 28 days and the proceedings were adjourned for interim argument to 11 August 2021 at 11:00am.
At the hearing on 11 August 2021, his Honour made the following substantive orders with respect to the wife’s Application in a Case:
5. The parties joint in obtaining a report on the progress of the sale of the [B Street, Town C] property from [Ms H] on or before 1 October 2021.
6. The [B Street, Town C] property be listed for $350,000 NOTING the parties will entertain all reasonable offers.
His Honour otherwise listed the matter for a Conciliation Conference on 18 October 2021 and a Trial callover hearing on 30 November 2021.
The parties attended a Conciliation Conference before Deputy Registrar AG. On 26 November 2021, Deputy Registrar AG filed a Certificate of Dispute Resolution noting that the matter had resolved before her at the said conference.
The matter first came before me on 30 November 2021. On that occasion, Mr Bowler of counsel appeared for the wife and there was no appearance by or on behalf of the husband. On that occasion, I made orders and notations as follows:
UPON FURTHER NOTING:
a) The Certificate of Dispute Resolution dated 26 November 2021 signed by Deputy Registrar [AG] confirming that the parties reached agreement at a recent Conciliation Conference;
b) The failure by the husband to appear at today’s hearing; and
c) In the event that the husband fails to attend at the adjourned date for hearing, the Court will consider setting down the wife’s application for property settlement on an undefended basis
THE COURT ORDERS THAT:
1. Within 7 days, the wife do serve the husband with a sealed copy of the orders made this day together with a covering letter confirming that should the husband fail to attend, orders will be made in his absence.
2. The wife’s solicitor do file and serve an Affidavit of Service during the period of the adjournment.
3. The wife’s oral application for costs thrown away, fixed in the sum of $550, be adjourned for consideration to the adjourned date.
4. Further consideration of the matter is adjourned to 9.30am on 17 December 2021 before Judge Dickson for directions.
On 16 December 2021, the wife’s solicitor Mr AH filed an affidavit confirming the attempts of service on the husband pursuant to the orders of 30 November 2021.
On 17 December 2021, the matter came back before me when the husband appeared in person. Pursuant to the notations made that day, the husband advised the Court that he was in error as to the hearing time on 30 November 2021 and apologised for his non-attendance. Further, the husband provided advice to the Court that the agreement reached by the parties at the Conciliation Conference on 11 November 2021 remained in place and that minor amendments were required by him. The Court noted on the order that if signed minutes of order were not prepared so that final orders could be made prior to the adjourned date, the matter would be listed for Trial. The proceedings were adjourned to 4 February 2022 at 9:30am.
On 4 February 2022, the husband again failed to appear. Mr Bowler, counsel on behalf of the wife advised the Court that the Minutes of Order had been forwarded to the husband seeking his consent on 19 January 2022 and 2 February 2022 and no response had been received. As foreshadowed by the notations made on the order of 17 December 2021, the Court listed the parties’ competing applications for Trial on 12 May 2022, noting two days allowed. The matter was adjourned to 8 March 2022 for directions and the wife’s oral application for costs in the sum of $550.00 was adjourned to that hearing.
At the Trial directions hearing on 8 March 2022, the husband again failed to appear. Trial directions were made on this occasion for the filing of Trial material and the preparation of the matter generally for the Trial listed on 12 May 2022.
An order was made for the wife to personally serve the husband with sealed copies of any amended Initiating Application, Trial affidavit and Financial Statement and a copy of the orders made that day within 7 days of those documents being filed with the Court.
On 11 and 22 April 2022, the wife filed her Trial material consisting of an Amended Initiating Application, Trial affidavit and updated Financial Statement.
On 3 May 2022, the matter came before me for a Trial management hearing. On that occasion, the Court raised concern with the wife’s counsel as to the wording of the wife’s Initiating Application with respect to the superannuation splitting order and the evidence required in relation to the assets and liabilities available at Trial. Orders were made for the wife to file and serve any Application in a Proceeding to dispense with personal service on the husband prior to the Trial. Further orders were also made for the wife to file and serve a further amended Initiating Application setting out with specificity the orders sought by her in relation to superannuation splitting prior to Trial.
At the said hearing, counsel for the wife also made an oral application for the wife to give evidence by Microsoft Teams, given that she is located at B Street, Town C, which is a some six hour drive from Adelaide. This oral application was acceded to by the Court on the condition that the wife gave her evidence at the office of her solicitor in B Street, Town C.
Pursuant to the orders of 3 May 2022, the wife filed an Application in a Proceeding with respect to dispensing with personal service on 5 May 2022. She also filed her Further Amended Initiating Application on 9 May 2022. On the same date, further affidavits confirming service on the wife were filed by her solicitor.
The Trial proceeded as listed on 12 May 2022. The husband did not attend and he did not comply with orders for the filing of Trial material. The Trial proceeded in his absence and was adjourned part heard to 28 June 2022 in person for the sole purpose of receiving into evidence a letter confirming procedural fairness on the Trustee of the husband’s superannuation fund.
On 28 June 2022 the husband appeared in person. The husband confirmed that he had been served with documents as directed in paragraph 1 of the orders as made on 12 May 2022. The husband advised that he wished to participate in the Trial and be heard in relation to the proposed orders for property settlement. Accordingly, the Court then adjourned the Trial part heard to 14 July 2022 for one day and extended the time for the husband to file and serve his Amended Response, Trial affidavit and Financial Statement to 6 July 2022, together with an extension of time granted for the filing of an Outline of Case document to 12 July 2022. The wife’s costs arising from the hearing on 12 May 2022 fixed in the sum of $6,000.00, plus GST, were reserved.
The Trial proceeded before me on 28 June 2022. The wife was represented by Mr Bowler of counsel. The husband appeared in person and was self-represented.
DOCUMENTS RELIED UPON AT TRIAL
The wife relied upon the following documents at Trial:
(1)Further Amended Initiating Application filed 9 May 2022;
(2)Amended Financial Statement filed 22 April 2022;
(3)Trial affidavit filed 22 April 2022;
(4)Trial affidavit filed 9 May 2022; and
(5)Outline of Case document.
The husband relied upon the following documents at Trial:
(1)Response to Application for Final Orders filed 21 February 2020;
(2)Affidavit filed 6 July 2022; and
(3)Outline of Case document filed 11 July 2022.
In addition, the wife tendered the following exhibits:
(1)Letter dated 5 May 2022 from Johnston Withers to N Super Fund (Exhibit A1);
(2)Bundle of emails from Johnston Withers to the husband (Exhibit A2);
(3)Letter from N Super Fund dated 10 June 2022 in relation to the superannuation splitting order (Exhibit A3);
(4)Impairment Assessment Report dated 5 November 2021 from Associate Professor Mr AJ in relation to the husband (Exhibit A4);
(5)Bank AD home loan account statement ending #...00 for the period ending 5 October 2017 (Exhibit A5);
(6)Return to Work SA payment advice dated 6 October 2021 (Exhibit A6);
(7)Company G payslip in the name of the husband dated 29 June 2021 (Exhibit A7); and
(8)Affidavit of the wife filed 20 August 2019 (Exhibit A8);
The husband tendered one exhibit, namely Outline of Case Document (final hearing) filed by the husband on 11 July 2022, marked as Exhibit R1.
ORDERS SOUGHT BY THE WIFE
As contained in her Further Amended Initiating Application, the wife sought the following orders at Trial:
l.That there be a division of the non superannuation assets of the marriage such that the wife receives 70% of the same, and the superannuation assets of the parties be divided equally.2.That the Respondent do pay the Applicant's costs of this Application and incidental thereto.1.That there be a division of the nett non superannuation assets of the marriage such that the applicant wife receives 65% and the respondent husband receives 35%.
2.
That the superannuation assets be divided equally between the parties.2.That in relation to the Respondent's ([MR COSTIN]) superannuation entitlements with [N Super Fund] member number … paragraphs 2(a), 2(b), 2(c), 2(d) and 2(e) (inclusive) herein are binding on the Trustee of the [N Super Fund], ("the Fund"):
(a)The Court allocate as required by section 90XT(4) of the Family Law Act 1975 ("the Act") a base amount of ONE HUNDRED THIRTY FIVE THOUSAND NINE HUNDRED AND ONE DOLLARS ($135,991.00) to the Applicant out of the Respondent's entitlement in the Fund.
(b)Pursuant to 90XT(l)(a) of the Act whenever the Fund makes a splittable payment out of the Respondent's interest in the Fund the Trustee shall:
i.pay to the Applicant ([MS HARCOURT]) or to her legal personal representative the entitlement calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001 using the base amount specified at paragraph 8(a); and
ii.make a corresponding reduction in the entitlement the Respondent would have had in the Fund but for this Order.
(c)That paragraphs 2(a) and 2(b) of these Orders have effect from the operative time.
(d)The operative time for the purposes of Order 2(c) of these Orders is four (4) business days after the date of service of these Orders upon the Trustee of the Fund.
(e)That the Trustee of the Fund shall do all such acts and things and sign all such documents as may be necessary so that, in accordance with the obligations set out under the Act and Family Law (Superannuation) Regulations 2001, the Trustee can calculate the entitlement of, and make payment to, the Applicant in accordance with paragraph 2 of these Orders.
(f)That the Applicant shall do all things necessary including, but not limited to, exercising her request pursuant to Regulation 7A.06(1) of the Superannuation Industry (Supervision) Regulations 1994 for the rollover or transfer of the transferable benefit out of the Respondent's interest in the Fund to a fund nominated by the Applicant in accordance with Regulation 7A.12 of the Superannuation Industry (Supervision) Regulations 1994.
(g)In the event that the Superannuation split to the Applicant pursuant to these Orders can be rolled over into a separate account to the Applicant, each of the parties do all such acts and things and execute all such documents as may be necessary to facilitate and to implement that rollover.
(h)That, pursuant to Regulation 14F of the Family Law (Superannuation) Regulations 2001 any payment from the Respondent's superannuation interest made after the Trustee has rolled over or transferred the transferable benefit to a fund nominated by the Applicant not a splittable payment.
3.That the respondent pay the applicant's costs of this Application and incidental thereto.
4.That the real estate properties, being the whole of the land comprised in Certificate of Title Register Book Volume […] Folio […] described as [B Street, Town C] ("the [B Street, Town C] property") and Volume […] Folio […] being the property at [D Street, Town E] ("the [D Street, Town E] property") hereinafter referred to together as "the properties" be sold, and for that purposes the wife is appointed as Trustee for the sale of the properties.
5.The husband do transfer and assign to the Trustee for the purposes of paragraph 1, the properties and that he forthwith execute a Memorandum of Transfer to be prepared by the solicitor for the wife of his interests to the Trustee within 7 days of a copy of this Order and of the transfer of land being served upon him personally and that he forthwith deliver the said transfers duly executed to the solicitors for the wife, [Mr AH], Johnston Withers, 17 Sturt Street Adelaide SA 5000.
6.In the event that the respondent fails to execute the transfer and to deliver them to the said solicitors within 7 days, the Registrar is appointed pursuant to Section 106A of the Family Law Act to execute the transfer in the name of the respondent and do whatever acts and things that may be necessary to give validity and operation to the said transfer.
7.That the trustee sell the properties by private treaty or by public auction as she may be advised subject to the following provisions:
7.1The offering price or reserved price in relation to the [D Street, Town E] property not be less than the sum of $150,000.00;
7.2The offering price or reserved price in relation to the [B Street, Town C] property not be less than $300,000.00;
7.3The Trustee may incur advertising expenses in relation to the properties up to the amount of $5,000 with respect to each property;
7.4The Trustee may incur costs for the purposes of redecorating or improvement of the presentation of the properties for the purposes of the sale to such amount as may be advised by the agents acting on the sale but not exceeding the amount of $2.500 for each property;
7.5The Trustee may retain [Mr F] of [Company G] for the purposes of acting as the agent for the sale of the [D Street, Town E] property;
7.6The Trustee may retain [Ms H] of [J Property] for the purposes of acting as the agent on the sale of the [B Street, Town C] property;
7.7The Trustee may enter into appropriate Agency Agreement with respect to an agent at an agreed sales commission of 2.7% or less for each of the properties;
7.8The Trustee may retain a solicitor and/or conveyancer of her choice to act for the Vendor on the sale;
7.9The Trustee is authorise to enter into a Contract for Sale on such terms as advised by the solicitors acting upon the sale;
7.10Liberty to apply to the Court be reserved to the Trustee to apply to the Court in respect of the terms and conditions of the sale for further directions in the event that it proves necessary;
7.11Upon completion of the sale of each of the properties the proceeds of sale shall be distributed as follows:
7.11.1 In payment of the agent's commission on sale;
7.11.2 The amount required to discharge any existing mortgage;
7.11.3The amount required for normal conveyancing adjustments as to municipal and water rates on sale;
7.11.4 The payment of legal costs of acting on the sale;
7.11.5The remaining balance is to be held on trust in the Johnston Withers Trust Account pending further Orders of the Court.
8. Such further or other orders as this Honourable Court deems fit.
In her oral evidence and under cross-examination by the husband the wife amended her position to seek 60% of the parties’ net non-superannuation assets. The wife was not re-examined by her counsel. I accept her evidence as therefore being the actual percentage sought by the wife at Trial.
ORDERS SOUGHT BY THE HUSBAND
The husband had not filed an Amended Response as directed by the Court in preparation for the Trial. The order contained in the Response to Initiating Application filed on 21 February 2020 simply sought the following:
1.That there be a division of superannuation assets of the marriage such that there is a fair and equitable division between the parties.
2.That there be an equalisation of superannuation assets.
The husband did articulate however in his evidence that he consented to the following orders:
(1)That the former matrimonial home and D Street, Town E be sold. The husband was opposed to the wife’s order that she have sole control of the sale process; and
(2)That there be an order for superannuation splitting in the terms provided in paragraph 2 of the wife’s Further Amended Initiating Application such that there be a splitting order in favour of the wife from the husband’s superannuation with N Super Fund in the sum of $135,991.00; and
(3)That the parties do otherwise retain all other assets within their respective possession or control.
The husband also stated that he proposed by way of final order that the wife receive an adjustment of 55% in her favour of the parties’ net non-superannuation pool and with the husband to receive the remainder.
ISSUES IN DISPUTE
The parties were in dispute at Trial in relation to the following :
(1)Whether or not the sum withdrawn by the husband in the sum of $55,000.00 from the parties joint Bank AD Offset account ending …40 should be added back into the pool or not;
(2)Whether or not the wife’s personal loan with Bank AD and with a balance of $14,905.00 should be adjusted as a joint liability;
(3)Whether or not the wife’s Bank AD visa with a balance in the sum of $8,500.00 should be added back into the balance sheet;
(4)Whether or not there was a value attached to the wife’s salon business “Company AE”;
(5)Whether or not the sum of $10,000.00 withdrawn by the wife from the parties joint Bank AD Account number …40 prior to separation should be added back into the pool; and
(6)Whether there should be a 60/40% split in favour of the wife of the non-superannuation assets as sought by the wife, or a 55/45% split of the non-superannuation assets in favour of the wife as sought by the husband.
To their credit, the parties were able to agree a large number of values for various assets by the conclusion of the Trial.
EVIDENCE
The wife
The wife adopted the terms of her Trial affidavits and Financial Statement during examination in chief.
The husband was given the opportunity to cross examine the wife.
The husband cross examined the wife with respect to the history of their respective employment during the marriage. The wife conceded that during the relationship the husband had worked in paid employment and that she had been a “stay at home mother” for seven years. During this period the wife remained at home undertaking domestic duties and caring for the parties’ three children.
The wife denied that her business is on the market for sale, adding that this last occurred approximately 10 years ago.
The wife stated that she had declared all of her bank accounts when challenged by the husband as to her financial disclosure.
The wife stated that she did not know and could not admit as to the level of communication between the husband and the children post separation, as the communication took place between the husband and the children direct.
In relation to the Asset and Liabilities schedule, the wife stated that the personal loan with a balance of $14,905.00 was the balance of a loan taken out by the wife in the sum of $40,000.00 for the purchase of furniture and effects when she and the children vacated the home at separation. At the time that the litigation commenced in June 2019, the said loan had a balance of $30,632.00.
The wife conceded that the sum of $8,500.00 owing on her Bank AD VISA represented credit utilised by her to purchase items for her business post separation.
The wife strongly disputed that her business “Company AE” had any value. The wife’s evidence was that she works as a sole trader, has only private individuals as clients and that all of her plant and equipment were aged. Furthermore, the wife rents premises and the business does not own any other assets.
Finally, the wife conceded that her motor vehicle would now have a value of $3,000.00.
The husband declined to ask any further questions.
Otherwise, the wife’s evidence supported the matters raised in her Trial affidavit.
The husband
The husband relied upon his Trial affidavit. The husband’s Outline of Case Document filed 11 July 2022 was also received as an Exhibit and marked R1 as the Outline contained matters which would normally be set out in a Trial affidavit.
The husband was cross examined by the wife’s counsel. He confirmed that he sought a 55/45% adjustment of the net non-superannuation assets in favour of the wife and furthermore, that he agreed with the superannuation splitting order proposed by the wife.
A significant amount of time was taken cross examining the husband in relation to withdrawals made by him from the parties’ joint Bank AD Offset account number ending …40 post separation. The husband denied withdrawing the sum of $10,000.00 on 15 March 2017, stating that this sum was withdrawn by the wife. The husband conceded that during the period 6 June 2017 to 11 July 2017 he had withdrawn the total sum of $55,000.00 from the parties’ joint account. The husband asserted that those funds were utilised for the payment of renovations on the former matrimonial home. The husband also stated that as the wife had been taking money, he also “took some”. The husband conceded that he had not produced at Trial any evidence confirming his assertion that the funds were spent on renovations, stating that he had provided the evidence to his former solicitor.
In addition to the transactions described above, significant cross examination was undertaken by the wife’s counsel regarding the husband’s self-described “hobby” of gambling. The husband was challenged as to whether or not he had a gambling problem. The husband replied “only when I don’t win”. The husband conceded that all of the entries contained in the parties’ joint offset account with reference to “Ladbrokes” or “Sportsbet” were funds spent by him pursuing gambling.
The husband stated in his evidence that the wife had always been aware of his gambling “hobby”, although conceded at one point in his evidence that she would not have been aware that he “blew $800 in one day”. The husband stated that he had always paid outgoings for the support of the family and that his gambling activities had not detrimentally affected the family whilst the parties resided together.
The husband conceded that he had ceased paying the mortgage secured over the former matrimonial home post separation. The husband’s evidence in this regard was confusing and at times, conflicting. Initially, the husband stated in his evidence that he could not afford to pay the mortgage, but then later conceded that he had ceased paying the mortgage because in his view, the wife should have been paying half of the repayments as the mortgage was in joint names. The position taken by the husband in this regard ignores the fact that he continued to have sole use and occupation of the former matrimonial home whilst the wife and the children rented accommodation elsewhere. It also flies in the face of the wife’s demonstrated efforts to sell the former matrimonial home as evidenced in this Judgment under the heading “History of Proceedings”.
Notwithstanding orders having been made by the Court for the sale of the home, it remains on the market for sale. The husband denied that he had made it difficult for the wife to sell the home. He conceded however that he did not agree with the advice provided by the selling agent to market the property at a lower value than that promoted by him. The husband stated in his evidence that he “still” disputed the advice provided by the selling agent to market the property at a range of between $290,000.00 and $320,000.00. The husband stated that the former matrimonial home is listed at $370,000.00.
Since being placed on the market for sale in 2020, the parties have only had one open inspection and no offers made.
The husband denied that he has delayed the sale of the former matrimonial home because he was in effect residing there without any consequent cost to him. The husband stated that he “paid for upkeep”, council rates, Emergency Services Levy and undertook maintenance such as mowing the lawns.
The husband’s evidence was that he now made interest only payments for the mortgage.
The husband agreed that it was in the parties’ best interests to try to achieve the best possible sale price for the home and stated that his reserve price was “$345,000.00”. When asked if the property did not sell at $345,000.00 whether he would agree to a reduction to $290,000.00, the husband was adamant the he would not.
The husband stated that he wished to remain living in the former matrimonial home pending settlement. When asked by the wife’s counsel, the husband agreed that he would facilitate all requests for inspection and would ensure that the property was well presented for sale. The husband would not agree to the wife having access to the former matrimonial home, in his absence or at all, particularly if he was working in Western Australia. The husband agreed that if he was interstate for work, then he would facilitate the sales agent having access to the property. The husband also conceded that he would continue to pay the mortgage “as I can” until the date of settlement. According to the husband, he is currently paying the sum of $350.00 per month representing interest only payments on the principal amount.
Exhibit A5 evidences the mortgage balance as at the date of 19 June 2017 being $102,938.32. The parties agree that the mortgage balance is now $100,064.00 as at 1 July 2022.
The husband gave evidence that he had been employed by “Employer AK” for the period from January 2021 to October 2021 as a tradesman. When asked as to the production of his tax returns to confirm his income during that period, the husband stated that he had not lodged his tax returns. He described undertaking some “small jobs” in 2022. The husband hoped to return to Western Australia to undertake further employment and had delayed returning to Western Australia due to attending at Court for the Trial.
The husband was cross examined in relation to his Work Cover payments and the injury leading to those payments being made. A report prepared by Associate Professor Mr AJ dated 5 November 2021 was tendered into evidence by the wife and marked Exhibit A4. Associate Professor Mr AJ is a Consultant Orthopaedic Surgeon. An assessment of the husband was undertaken by Associate Professor Mr AJ on 25 October 2021. On page 5 of the said report Associate Professor Mr AJ concluded:
In my opinion, there is no whole person impairment as a result of the right knee injury that occurred on 8 July 2020.
The husband conceded that he had accepted Associate Professor Mr AJ’s opinion “at the time” the report had been prepared. The husband complained that he now has a “arthritic knee” which plays up “when he gets cold”. The husband went on to add that he could not find work “if I have an impairment”. Despite this impairment caused by the arthritic knee, it was obvious from the husband’s evidence that he intended to return to Western Australia within “a couple of weeks of the Trial” for employment purposes earning $50.00 to $60.00 per hour.
In relation to the husband’s contact with the parties’ children, the husband conceded that he has had minimal contact with the children since the date of separation. The youngest child X is now 16 years of age. The husband conceded that he last saw X for his birthday in 2020. To his credit, the husband agreed that the wife has had “100%” care of the children for the past five years. He described the wife as a “good mum” and that “absolutely” the wife should be given credit for her care of the children.
The husband disputed that his boat stored at D Street, Town E had any value. The husband ascribed a nil value in his oral evidence. The husband’s evidence was that the motor on the boat had “blown” and that it was not insured. The wife’s counsel then suggested that if the boat had nil value, that the wife be able to sell the boat and retain the proceeds of sale. In response, the husband conceded that the wife could sell the boat but on the proviso that the money was added back into the pool available for division at Trial.
ASSETS AND LIABILITIES
The initial Schedule of Assets and Liabilities at Trial being Annexure 1 to the wife’s affidavit filed 9 May 2022 and Part D of the husband’s Outline of Case (Exhibit R1) was as follows:
Description Ownership Applicant’s value Respondent’s value ASSETS Former matrimonial home at B Street, Town C (Husband residing) Joint $ E 300,000.00 350,000.00 Property at D Street, Town E Joint E 170,000.00 150,000.00 Motor Vehicle 2 Wife E 3,000.00 5,000.00 Furniture Wife E 1,500.00 Agreed Bank AD savings account no …40 as at 22 April 2022 Wife 500.00 Agreed Motor Vehicle 1 Husband E 13,000.00 Agreed Furniture Husband E 2,000.00 Agreed Tools Husband E 1,000.00 Agreed Company L 2,346 @ $47.44 (as at 4.5.22) Husband 111,294.00 90,297.00 Company M Shares 2,346 @ $4.65 (as at 4.5.22) Husband 10,908.00 8,750.00 Bank Account at November 2021 Husband 6,000.00 7,175.00 Boat (stored at D Street, Town E) Husband E 5,000.00 Nil Net total of monies withdrawn by husband from Bank AD joint offset account at separation 55,000.00 Nil Company L Share Dividends 2017-2019 – Total dividends received $12,182.00 12,182.00 Agreed Business “Company AE” Wife Nil 60,000.00 Monies withdrawn by wife post separation from Bank AD joint offset account Wife Nil 10,000.00 Assets subtotal $ 693,884.00 711,404.00 LIABILITIES Bank AD Home Loan
Loan account number … at 22 April 2022Joint 100,064.00 100,064.00 Personal Loan at 22 April 2022 Wife 14,905.00 NK Visa Bank AD at 22 April 2022 Wife 8,500.00 NK Liabilities subtotal $ 123,469.00 100,064.00 SUPERANNUATION Name of Fund Type of interest Member Applicant’s value Respondent’s value N Super Fund – 30.06.21 Accumulation Husband 396,811.00 405,000.00 K Super Fund – 30.06.21 Accumulation Wife 124,830.00 NK Superannuation subtotal $ 521,641.00
In relation to the Schedule of Assets and Liabilities above, it is appropriate that some of the line items be subject of findings of the Court and in light of the parties’ evidence.
The former matrimonial home at B Street, Town C and the property at D Street, Town E
At Trial, the parties were in agreement that the said properties be sold. The wife seeks an order that she be appointed sole Trustee for the sale of the said properties. It is the wife’s case that the husband has deliberately obstructed the sale of the former matrimonial home and will not cooperate with orders of the Court, given that the former matrimonial home has been on the market for three years and with no offers having been made in the intervening period. Both parties agree that it is in their best interests to maximise the net proceeds of sale.
I am satisfied having regard to the evidence of the parties and the difficult trajectory up to the date of Trial regarding the marketing and sale of the former matrimonial home, that it is appropriate to appoint the wife as sole Trustee of the sale process. Having heard the husband’s evidence, I have no confidence in the parties’ ability to navigate further negotiations in relation to the sale price. The parties separated five years ago. The wife has continued to reside in rental accommodation with the children. The wife’s desire to move on with her life and to purchase a home for herself is both reasonable and understandable in the circumstances. The wife did not seek an order that the husband vacate the former matrimonial home during the sale process. I should indicate in these Reasons that had such an application been made, I would have likely made such an order.
Under cross examination, the husband conceded that he would cooperate with the sales agent and would also maintain the property and make the property available for open inspections. I intend to make orders in those terms to ensure that there is no further delay. If the husband is working interstate during the marketing of the property, then this should not be an impediment to open inspections, offers being made and ultimately settlement of the property in the circumstances of this case. The Court is confident that the wife will discharge her role as Trustee of the sale of the said properties appropriately and diligently so as to bring about the best possible price.
Boat
The wife ascribed an approximate value for the husband’s boat at D Street, Town E of $5,000.00. The husband stated in his evidence that the boat has no value. In circumstances where the boat has some sentimental value for the husband and given the manner in which the husband’s evidence was given on this topic, I do not consider it appropriate to make an order for the wife to seize the boat and sell it, unless the parties are in agreement that this should occur.
In the absence of a formal valuation or an agreement as to value, I am not inclined to ascribe any value to the husband’s boat and the husband is at liberty to retain this item without further adjustment. Any arrangement which would see the boat seized and sold is likely to be highly fraught and not cost effective, noting the modest value ascribed by the wife and potential legal fees which will be incurred.
Monies withdrawn by husband from joint Bank AD Offset account
The husband conceded in his evidence that he had withdrawn the sum of $55,000.00 from the said account post separation. It was his evidence that those funds had been applied for renovations and maintenance to the former matrimonial home. The husband conceded that he had not produced any evidence at Trial in relation to this assertion and that all documents were with his former solicitor.
The state of the evidence of the withdrawals post separation and where the monies were disbursed was unsatisfactory. The addback was not included in the Balance Sheet attached to the wife’s Trial affidavit filed 9 May 2022. The entry as a separate line item first appears in the wife’s Outline of Case Document.
I decline to exercise my discretion to add back in the sum of $55,000.00 into the asset pool. The evidence on these transactions is less than clear given that the wife did not seek to cross examine the husband on his personal bank statements and noting that the withdrawals occurred five years ago.
Monies withdrawn by the wife from the Joint Bank AD Account
The husband asserts that the wife withdrew $10,000.00 from the parties’ joint account and deposited the money into her business account shortly before separation. The wife was not cross examined on this topic and it is not referred to her in her Trial affidavit.
I decline to exercise my discretion to include this item in the Balance Sheet. The state of the evidence does not permit a finding as to how the wife dispersed these funds or even if she agrees that the funds were deposited into her account.
Wife’s business “Company AE”
The wife’s beauty business was purchased by the parties in or about 2009/2010. The parties borrowed the sum of $50,000.00 in order to complete the purchase.
The wife’s unchallenged evidence is that she operates the business as a sole trader, has no private contracts and undertakes beauty treatments for private individuals. The wife does not currently employ any staff and rents the business premises.
The wife’s evidence, which was unchallenged by the husband, is that the minimal plant and equipment which is associated with the said business is aged and has no value.
I accept the wife’s evidence that the business operated by her has no value, other than stating the obvious, which is that it provides a source of income for the wife. No valuation was obtained by the parties throughout the course of the litigation and accordingly I intend to ascribe nil value to the said business.
Wife’s personal loan
The balance of the wife’s personal loan as at 22 April 2022 is in the sum of $14,905.00. The wife’s evidence is that this sum represents the balance of funds borrowed by her post separation in order to establish a home independently for herself and the children. The wife’s evidence was not challenged by the husband. I will therefore keep this item in the balance sheet in the sum described by the wife, noting that the husband retained the balance of the parties’ furniture and effects at separation. The wife has reduced the balance owing on this loan since proceedings commenced when the balance was $30,632.00. It is appropriate to include this liability as a joint debt given that the husband retained the contents of the home at separation for his sole benefit.
Bank AD VISA liability in the name of the wife
The wife claims the sum of $8,500.00 in the Balance Sheet being an outstanding Bank AD VISA debt as at 22 April 2022. The wife conceded that the debt associated with this credit card was for the purchase of items for her beauty salon and was incurred post separation. In those circumstances, I do not consider it appropriate to bring the VISA debt to account and will exercise my discretion to exclude it from the Balance Sheet accordingly.
Legal fees
Neither party provided a Cost Notice in accordance with rule 12.06 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (‘the Rules’). Neither party raised the issue of legal fees as an add-back at Trial. I therefore propose not to have reference to any paid legal fees in the Balance Sheet.
REVISED ASSET POOL
Accordingly on the basis of the findings above and the parties evidence at Trial when concessions were made, the revised Asset and Liabilities schedule is as follows:
Description Ownership Value ASSETS 1 Former matrimonial home at B Street, Town C (Husband residing) Joint To be sold 2 Property at D Street, Town E Joint To be sold 3 Motor Vehicle 2 Wife 4,000.00 4 Furniture Wife 1,500.00 5 Bank AD savings account no … as at 22 April 2022 Wife 500.00 6 Motor Vehicle 1 Husband 13,000.00 7 Furniture Husband 2,000.00 8 Tools Husband 1,000.00 9 Company L Shares 2,346 @ $47.44 (as at 4.5.22) Husband 90,297.00 10 Company M Shares2,346 @ $4.65 (as at 4.5.22) Husband 8,750.00 11 Bank Account Husband 6,000.00 12 Boat (stored at D Street, Town E) Husband Nil 13 Company L Share Dividends 2017-2019 – Total dividends received $12,182.00 Husband 12,182.00 14 Company L Share Dividends from 2019-2022 Husband $15,000.00 15 Wife’s business Wife Nil Assets subtotal $ 154,229.00 16 Bank AD Home Loan
Loan account number … at 1 July 2022Joint 100,064.00 17 Personal Loan at 22 April 2022 Wife 14,905.00 Liabilities subtotal $ 114,969.00 Name of Fund Type of interest Member Applicant’s value 18 N Super Fund – 30.06.21 Accumulation Husband 396,811.00 19 K Super Fund – 30.06.21 Accumulation Wife 124,830.00 Superannuation subtotal $ 521,641.00
Accordingly, as per the table referred to above, the assets to be retained by the wife in items 3, 4, 5 and 15 total $6,000.00. The personal assets to be retained by the husband in items 6, 7, 8, 9, 10, 11, 12 13 and 14 total $148,229.00.
SUBMISSIONS
The wife
The wife’s counsel’s submissions were consistent with the wife’s Case Outline.
The wife’s counsel submitted that the Court could be confident in making an order appointing the wife as sole Trustee of the sale of the real properties, given that it is in the wife’s interests to achieve the best possible price. Reference was made to the fact that some three years after litigation commenced, neither property has been sold, notwithstanding previous orders made by this Court. Simply put, the wife’s position is that if the husband is given any opportunity, he will frustrate the sale process.
The wife acknowledged through her counsel the husband’s “understandable” disappointment in relation to the value of the former matrimonial home. It was submitted however that “in reality” the price sought by the husband was simply not achievable.
It was submitted that the rent paid by the wife per week post separation was at times greater than the mortgage payments paid by the husband in one year.
It was noted by the wife’s counsel that the Asset and Liabilities Schedule was now largely agreed. The wife’s counsel strongly submitted that the $55,000.00 withdrawn by the husband post separation should be added back into the pool, as the husband had provided no evidence to the Court explaining what had occurred with those funds. The uncertainty about the disbursement of those funds was said to be made more problematic given the husband’s gambling “hobby”. It was submitted that the cross examination of the husband’s expenditure on gambling was put before the Court to highlight the husband paying for anything other than monies towards the mortgage rather than a “wastage” argument. The amounts referred to in the annexures to the wife’s affidavit filed 20 August 2019 (Exhibit A8) were said to show a “snapshot” of what occurred in that time when the husband gambled monies from the joint offset account.
In relation to the husband’s employment, it was submitted that the husband had accepted that the medical assessment provided by Associate Professor Mr AJ was correct, albeit that the husband had qualified his answer by saying he had agreed it “at that time”. It was submitted that the husband has the capacity for employment and whilst it was difficult to determine with any precision his future income, the Court could have confidence in assessing the husband’s capacity to earn an income commensurate with that currently enjoyed by the wife.
The husband
The husband submitted that he had “always” presented the former matrimonial home in a neat and tidy state for open inspections. Whilst conceding that at times he had not paid the mortgage, the husband submitted that he had been responsible for meeting council rates, Child Support and legal fees. The husband acknowledged that the wife had paid rent since separation, but observed that the wife is now in a new relationship and was likely to share expenses with her new domestic partner.
As to the allegations of gambling, the husband submitted that this was a hobby that he had engaged in since the parties first commenced their relationship. The husband submitted that he tried “not to lose too much” and to gamble “within my means”.
Finally, the husband submitted to the Court that he just “wanted a fair go” and considered that the parties property dispute “could have resolved months ago”. The husband blamed the wife’s legal representatives for the lack of agreement, ignoring his less than diligent engagement in these proceedings after he had become self represented.
APPLICABLE LEGAL PRINCIPLES
Part VIII of the Family Law Act 1975 (Cth) (‘the Act’) governs property, spousal maintenance and maintenance agreements as it relates to married parties.
Section 79(1) of the Act provides:
(1)In property settlement proceedings, the court may make such order as it considers appropriate:
(a) in the case of proceedings with respect to the property of the parties to the marriage or either of them--altering the interests of the parties to the marriage in the property.[1]
[1] Family Law Act 1975 (Cth) s 79(1).
Section 79(2) provides:
That the Court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.[2]
[2] Ibid s 79(2).
In considering what order (if any) the Court should make pursuant to section 79(1) of the Act, there are a range of factors that are to be taken into account. These factors are:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e)the matters referred to in subsection 75(2) so far as they are relevant; and
(f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.[3]
[3] Ibid s 79(4).
Section 79(4)(e) requires the Court to consider the factors set out in section 75(2) of the Act. These are colloquially known as the ‘future needs’ factors and are:
(a)the age and state of health of each of the parties; and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant; and
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party's role as a parent; and
(m)if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
(naa)the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i) a party to the marriage; or
(ii) a person who is a party to a de facto relationship with a party to the marriage; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement that is binding on the parties to the marriage; and
(q)the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
The leading case as it relates to matrimonial property matters is the High Court decision of Stanford & Stanford.[4] In Stanford, the High Court confirmed that the interference with legal and equitable interests of parties must adhere to principled reason.[5]
[4] Stanford & Stanford (2012) 247 CLR 108 (per French CJ, Hayne, Kiefel and Bell JJ).
[5] Ibid [41].
In considering whether it is just and equitable to make an order where an application is made for property settlement, the High Court stated:
In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of martial property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable to make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).[6]
[6] Ibid [42].
In this case, I find it just and equitable to make an order for property settlement given the parties’ competing applications for property settlement.
CONTRIBUTIONS
Section 79(4)(a) and (b) – Financial Contributions
The evidence does not permit a finding that the parties had any assets or liabilities at the commencement of cohabitation.
There is no dispute that for a period of seven years during the relationship the wife did not engage in paid remuneration. Instead, the wife was responsible for undertaking domestic duties and caring for the parties’ three young children.
In paragraph 12 of the wife’s Trial affidavit, she refers to the husband accepting a redundancy from his then employer, Employer AL in 1993. No quantum is ascribed and it was deposed by the wife that those funds were used for the purchase of a motor vehicle and caravan before the parties departed on what could be described as “working holiday”.
In or about 2015, the wife received the sum of $30,000.00 by way of back pay from Centrelink for unclaimed Family Tax Benefit. Her evidence is that those funds were utilised to renovate the former matrimonial home.
Aside from the lump sums referred to above, there were no other significant lump sum contributions made by either party during the period of their relationship.
The husband worked throughout the period of the relationship and only recently has alleged having difficulties securing full time employment.
The evidence supports a finding that each of the parties have worked hard during the course of their very lengthy relationship and have made significant contributions towards the acquisition, maintenance and conservation of assets now available for distribution at Trial.
There is no dispute that the husband has remained living in the former matrimonial home since separation. Immediately post separation, the wife continued to pay the sum of $500.00 per week towards the mortgage until October 2017 in addition to meeting her rental repayments. The husband ceased paying the mortgage during the period from August 2017 until October 2020, thereafter, the husband made the following mortgage repayments:
(a)The sum of $8,209.00 between the period 6 October 2020 to 5 April 2021;
(b)The sum of $6,000.00 between the period 6 April 2021 to 5 October 2021; and
(c)The sum of $4,589.95 between the period 6 October 2021 and 5 April 2022.
The wife deposes in paragraph 67 of her Trial affidavit that the monthly mortgage payments post separation were as follows:
(a)From the date of separation until 5 April 2019, the sum of $1,744.00 per month; and
(b)From 5 April 2019 to April 2022, the sum of $1,572.00 per month.
The current mortgage balance is $100,064.00 as at 1 July 2022, with a balance as at the date of separation recorded as $102,938.32 as at 19 June 2017 (Exhibit A5).
The evidence supports a finding that the husband has not made a proper financial contribution to the payment of the mortgage debt post separation in circumstances where he continued to be the sole occupant of the former matrimonial home. I reject the husband’s assertion that the wife should have been meeting half of the mortgage repayments following separation, when she was responsible for paying rent in the sum of $380.00 for herself and the children, whilst also repaying a personal loan taken out post separation for furniture and effects and supporting the children.
The evidence supports a finding that the husband’s financial contribution post separation has been problematic and that the husband has been less than enthusiastic in trying to sell the former matrimonial home, unless it is on his terms.
Section 79(4)(c) – Contributions to the welfare of the family
The parties had three children. There is no dispute that for at least seven years following the birth of the parties’ first child, the wife was the undisputed primary caregiver to the children and undertook all domestic duties.
Post separation, the care of the three children fell exclusively to the wife. To his credit, the husband conceded under cross examination that the wife had been a “good mother” to the children and had been solely responsible for their care, save for the payment of periodic Child Support by the husband.
Neither party provided any evidence to the Court in relation to the husband’s non-financial contributions to the welfare of the family.
Section 79(4)(d) – The effect of any proposed order upon the earning capacity of either party to the marriage
Not relevant.
Contribution conclusion
Both parties have made contributions to the acquisition, conservation and improvement of the parties’ property and to the welfare of their family over the course of a very long relationship. Their respective contributions were at times made in different, but still important ways. During their relationship, I assess their respective contributions as equal.
Importantly, since separation the wife has made a far greater contribution given her primary care of the children and the irregular payment of Child Support by the husband. The husband has also had total unfettered enjoyment of the former matrimonial home while the wife has rented. The wife’s post separation contributions to the care of the children warrants a 7.5% adjustment in her favour based on all of the evidence available at Trial.
SECTION 75(2) ADJUSTMENT
As at the date of Trial, the wife was 48 years of age and the husband was 60 years of age. The wife is in good health. The husband is also in good health, save for an alleged arthritic right knee.
There is no dispute that the wife will remain the full time caregiver to X. The evidence supports a finding that it is unlikely that the husband will play any meaningful role in X’s life pending him attaining the age of majority.
Based on the evidence (or lack thereof) provided by the husband at Trial, I am unable to make any definitive finding in relation to the husband’s future income. The husband did not comply with orders made for the filing of an updated Financial Statement in preparation for Trial.
Whilst the husband had been in receipt of Work Cover payments, up and until late 2021 he confirmed under cross examination that he intended to return shortly to Western Australia to work for a company earning $50.00 to $60.00 per hour. Based on the husband’s working history, and the lack of medical evidence to the contrary, the evidence supports a finding that the husband will continue to engage in paid remuneration into the future.
The wife works as a self-employed beauty therapist, earning a gross average weekly income of $1,174.00. The wife’s average weekly drawing from her business is $1,000.00 gross per week. In addition the wife receives Centrelink entitlements totalling $174.00 per week. The wife receives sporadic Child Support from the husband for the support of their youngest child X, now aged 16 years. In her oral evidence in chief, the wife alleged that as at 12 May 2022 the husband was $4,500.00 in arrears of his Child Support obligations.
In paragraphs 61 to 64 of the wife’s Trial affidavit, the wife sets out payments made by the husband toward the support of the children since separation. Significantly, during the period from the date of separation on 17 June 2017 until 28 January 2020, the wife received no financial support for the parties’ children. The wife refers in her Trial affidavit to not receiving any Child Support from the husband since December 2021 to the first day of Trial on 12 May 2022.
The husband has been less than diligent in meeting his financial responsibilities for the care of the parties’ children, which has been the sole responsibility of the wife, save for the payments referred to in her Trial affidavit.
The wife has repartnered with a Mr AM, but no information is provided in the wife’s Financial Statement as to his average weekly income and nor did the husband cross examine the wife on this topic.
The wife has paid rent since separation in the sum of approximately $380.00 per week. The husband has made some effort towards the payment of the mortgage, but that issue is not without controversy and as at the date of Trial, the husband conceded that he was only making interest only payments on the principal sum owed to Bank AD in the sum of $350.00 per month.
Given that the wife retains the primary care of X, without any proper payment of Child Support by the husband a further adjustment in the sum of 2.5% is just and equitable in favour of the wife.
THE OVERALL EFFECT OF THE ORDERS
My assessment of the parties’ contributions pursuant to section 79(4) of the Act and the section 75(2) factors lead me to a conclusion that the parties’ net non-superannuation assets should be divided 60% to the wife and 40% to the husband.
The wife will retain her motor vehicle at $4,000.00 and her savings at $500.00 and her furniture at the value of $1,500.00. The wife’s total assets to be retained are therefore a total of $6,000.00.
The husband will retain his motor vehicle, furniture, tools, savings, shares and dividends, and the boat at a total of $148,229.00.
The parties are in agreement that the former matrimonial home and the D Street, Town E property are to be sold. The wife is to receive 60% of the net sale proceeds after bringing to account the $6,000.00 worth of assets to be retained by her.
I also find it is just and equitable to make the superannuation splitting order in the terms as agreed by the parties.
Given the litigation history and the husband’s ongoing occupation of the former matrimonial home, I propose to make orders to ensure the husband’s compliance with the sale process and will make orders for the husband to continue to meet all outgoings for the former matrimonial home pending settlement.
JUSTICE AND EQUITY
I am satisfied that given the length of the marriage, the parties’ contributions throughout the marriage and post separation and my findings thereon and the section 75(2) factors that the orders set out herein providing for an adjustment of the parties’ property interests are just and equitable.
CONCLUSION
For all of the above reasons, I make the orders as set out at the commencement of this judgment.
I certify that the preceding one hundred and sixty-two (162) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Dickson. Associate:
Dated: 11 August 2022
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