Harlem and Harlem

[2008] FamCA 375

FAMILY COURT OF AUSTRALIA

HARLEM & HARLEM [2008] FamCA 375

FAMILY LAW – CHILDREN – Parenting orders

FAMILY LAW – PROPERTY SETTLEMENT

APPLICANT: Mrs Harlem

RESPONDENT: Mr Harlem

FILE NUMBER: BRF 3862 of 2005

DATE DELIVERED: 23 May 2008

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Bell J

HEARING DATE: 15-19 November 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Kirk SC

SOLICITOR FOR THE APPLICANT: Hopgood Ganim Lawyers

COUNSEL FOR THE RESPONDENT: Mr Favell

SOLICITOR FOR THE RESPONDENT: Hirst & Co

ORDERS:

PARENTING ORDERS

1. The Mother and Father have equal shared parental responsibility for the children E born … February 1995 and W born … June 1997 (after this referred to as “the children” or individually by name).

2. That the children live with the Father and Mother at all such times as agreed between the parties and failing agreement then during school term as follows:

   2.1 with the Father each alternate weekend from 4.00pm on Friday until 4.00pm on Sunday;

   2.2 For E, each Tuesday evening from 4.00pm until 7.00am the following day; and

   2.3 For W, each Wednesday evening from 4.00pm until 7.00am the following day;

   2.4 That save as otherwise provided in these orders the children live with the Mother.

   School Holidays

3. That the children spend time with each party during school holidays as agreed between the parties and failing agreement as follows:

   3.1.The Father spend time with the children in the first half of all school holiday periods in 2008 and in each alternative year thereafter (“even years”) commencing at 4.00pm on the last day of school term. 

   3.2.The Mother spend time with the children in the second half of all school holiday periods in 2008 and in each alternative year thereafter (“even years”) commencing at 4.00pm on the day that is the first day of the second half of the school holiday period.

   3.3.The Father spend time with the children in the second half of all school holiday periods in 2009 and in each alternative year thereafter (“odd years”) commencing at 4.00pm on the day that is the first day of the second half of the school holiday period.

   3.4.The Mother spend time with the children in the first half of all school holiday periods in 2009 and in each alternative year thereafter (“odd years”) commencing after school on the last day of school term.

4. Order 2 herein shall be suspended during all school holiday periods and the Easter holiday period and:

   4.1.If the children spend time with the Father for the first half of any school holiday period, then his time with the children should recommence on the first weekend of school term; and

   4.2.If the children spend time with the Father for the second half of any school holiday period then his time with the children should recommence on the second weekend of the school term.

   Special Occasions

5. On Christmas Day, the children are to spend time with the parent that they are not living with between 9.00 am and 2.00 pm on that day.

6. On Father’s Day, should that day fall during a day when the children would otherwise be living with the Mother, the children spend time with the Father from 9.00 am to 9.00am the following day.

7. On Mother’s Day, should that day fall on a day when the children would otherwise be living with the Father, the children spend time with the Mother from 9.00 am to 9.00 am the following day.

8. On the Father’s birthday, should this fall on a day when the children would otherwise be living with the Mother, the children spend time with the Father as follows:

   8.1.If the birthday falls on a school day, from 4.00pm to 8.00pm; and

   8.2.If the birthday falls on a non-school day, from 9.00am until 9.00am the following day with the Father to collect the children from and return the children to the Mother’s home.

9. On the Mother’s birthday, should this fall on a day when the children would otherwise be living with the Father, the children spend time with the Mother as follows:

   9.1.If the birthday falls on a school day, from 4.00pm to 8.00pm; and

   9.2.If the birthday falls on a non-school day, from 9.00am until 9.00am the following day with the Mother to collect the children from and return the children to the Father’s home.

10. On each of the children’s birthdays, the children are to spend time with the parent they are not living with as follows:

    10.1.If the child’s birthday falls on a non school day for four hours on that day as agreed by the parties and failing agreement between 10.00am and 2.00pm; and

    10.2.If the child’s birthday falls on a school day for no less than 4 hours as agreed by the parties and failing agreement between 4.00pm and 8.00pm.

    Collection and Delivery

11. The arrangements to transport the children between the Father’s home and Mother’s home be as follows:

    11.1.The Father or his agent is to collect the children from the Mother’s home at the commencement of the time the children beginning living with the Father;

    11.2.The Father or his agent is to return the children to the Mother’s home or the children’s school (as the case may require) at the conclusion of the time the children recommence living with the Mother.

    Specific Issues

12. That each party keep the other party informed of changes to the respective party’s residential addresses and/or home telephone numbers and/or mobile telephone numbers within 24 hours of any such change.

13. The parties be restrained and an injunction be granted restraining the parties from denigrating the other party or the other party’s partner or children in the presence or hearing of the children.

14. The parties use their best endeavours to ensure that no third party denigrates the either of the parties, the parties’ partners or children in the presence of hearing of the children.

15. The parties be restrained and an injunction be granted restraining the parties from discussing any Court proceedings between them in the presence or hearing of the children.

16. That each party keep the other party informed of the names and addresses of any and all medical practitioners who are involved in treating or caring for the children.

17. That each party authorise each of the children’s medical practitioner to discuss with the other party the children’s health and medical treatment.

18. That the Mother and Father inform the other as soon as it is reasonably practicable of any medical condition, significant health issue and/or illness suffered by any of the children and authorise any treating medical practitioner to give the other parent such information that he or she may reasonably request pertaining to such condition.

19. That the Mother and Father authorise the children’s schools to provide to the other parent copies of all school reports and any other reports on the children’s progress and behaviour issues and all notices received from the school including newsletters, parent letters and general notices.

20. That the Mother and Father authorise the children’s schools to inform the other parent of all extra curricular activities that occur at the children’s school including parent/teacher meetings, sporting/special events and any other activities to which the parents are invited.

21. That the Mother and Father authorise the children’s schools to contact the other parent in respect to school photographs and that provision of such photographs must be arranged by the Father and Mother with the school directly.

22. In the event the children bring to the respective home of the Mother or Father, any school, sport or other social activity newsletters, parent letters or general notices, the Mother or Father shall provide a copy of the same to the other parent.

23. That both parties shall be entitled to attend any public or school social, sporting or educational event involving the children, including but not limited to theatre performances, sporting events, school activities and functions, Christmas parties and other special occasions and that both parties:

    23.1.inform the other party of such events in a timely manner; and

    23.2.communicate to the other if arrangements are made for the children to attend such an event whilst the child is not in that party’s care.

24. That each party shall facilitate the children being present at special events for their extended family in Australia.

25. That the Mother and Father notify the other of any proposed holiday location out of Queensland where it is intended that they will take the children and provide a contact telephone number where the children may be contacted during such period.

26. That pursuant to section 65Y(2) of the Family Law Act 1975 each party shall be permitted to take the children out of the Commonwealth of Australia for holidays upon four (4) weeks written notice to the other party of their intent to do so, and shall provide to the other at least thirty (30) days prior to that departure:

    26.1a general itinerary and telephone numbers at which the children may be contacted during such absences from Australia;

    26.2copies of the pre-paid return tickets for travel; and

    26.3in the event that there is a material change in that itinerary or telephone number, the party shall forthwith notify the party that remains in Australia of such change.

27. Within fourteen (14) days of a written request from the other party, each party do all such acts and sign all such documents as may be required to apply for a passport or any other documents deemed necessary for the purpose of travel.

28. That neither party relocate the children’s home from a 50 kilometre radius of the Brisbane General Post Office without the prior written consent in writing of the other party or by Order of the Court.

    PROPERTY SETTLEMENT AND MAINTENANCE

29. That as and by way of property settlement and maintenance, the Husband and Wife receive and/or retain the property and resources as set forth in the following orders.

    Property to be Retained by the Wife

30. That within 7 days of the date of this order the Husband do all things and sign all documents necessary to transfer to the Wife, free of any encumbrance, all of his right, title and interest in the property located at C in the State of Queensland more particularly described as Lots … and … on Registered Plan …, County of …, Parish of … together with the contents of that property provided that the preparation of any necessary documents be undertaken by the Wife and the Wife be solely responsible for the costs of and associated with the said transfer;

31. That within 7 days of the date of this order the Husband do all things and sign all documents necessary to transfer to the Wife, free of any encumbrance the Toyota Landcruiser motor vehicle, registration number … currently in her possession provided that the preparation of any necessary documents be undertaken by the Wife and the Wife be solely responsible for the costs of and associated with the said transfer;

32. That except as these orders provide to the contrary as against the Husband, the Wife is the owner and the Husband has no interest in:

    32.1.Any monies standing to the credit of the Wife in any bank accounts in her sole name;

    32.2.Monies paid to the Wife’s solicitors, Hopgood Ganim Lawyers, in the amount of $250,000.00;

    32.3.All furniture, furnishings, jewellery and chattels currently in her possession;

    32.4.Her entitlements in the Harlem Superannuation fund (“the Super fund”) provided that the Husband and Wife as trustees of the Super fund shall take such steps as may be necessary to transfer her such interest to a fund nominated by the Wife her entitlements in the Super Fund;

    32.5.Her shares in publicly listed companies;

    32.6.The Toyota Landcruiser motor vehicle currently in her possession;

    32.7.The payment received by her pursuant to paragraph 33 of these orders.

33. That the Husband pay to the Wife or as directed by her in writing within 7 days of the date of these orders the sum of $279,932.30.

34. That the Husband be responsible for and pay the interest arising on the advance taken by the Wife from Impact Capital forthwith and by no later than within seven days of the Wife providing to the Husband a letter from Impact Capital specifying the interest payable provided that the Husband be responsible for the payment of interest only from the date of the advance by Impact Capital to the Wife to the date of payment by the Husband of the amount payable by him pursuant to paragraph 33 of these orders (except in the event of default by the Husband in which case he will be responsible for all interest payable and indemnify the Wife in relation to same until he complies with this order).

    Property to be Received and/or Retained by the Husband

35. That the Wife within 45 days of the date of these orders do all things and sign all documents necessary to transfer to the Husband or at his direction all interests held by her in M Pty Ltd, the Harlem Family Discretionary Trust (of which M Pty Ltd is the trustee), the Harlem Property Trust (of which the Husband is trustee), the Harlem Investment Trust (of which Harlem Property Holdings Pty Ltd is trustee) and A Pty Ltd (hereinafter referred to collectively as “the [Harlem] Group”) and resign from all positions held by her therein.

36. That upon the transfer of the Wife’s superannuation entitlement from the Super Fund in accordance with paragraph 32.4 the Wife shall forthwith resign as a trustee and from all other positions she may have held in the Super Fund.

37. That except as these orders provide to the contrary as against the Wife, the Husband retain as his property the following:

    37.1.The entitlement of the Husband as a member of the Super Fund;

    37.2.The shares and other interests held by him in the Harlem Group;

    37.3.The money standing to the credit of the Husband in any loan accounts of beneficiary accounts of the entities within the Harlem Group;

    37.4.His interest in:

    37.4.1.The property situated at N in the  State of Queensland being more particularly described as Lot … on Building Unit Plan …, County of …, Parish of … together with the contents of that property;

    37.4.2.Units 9, 10 and 16 M Street in the State of Queensland more particularly described as Lots 9, 10 and 16 on Building Unit Plan … County of …, Parish of … and share in common property as shown on Certificate of Title Nos. …, … and …; and

    37.4.3.The property situated at L in the State of Queensland more particularly described as Lot … on Building Unit Plan … and share in common property as shown on Certificate of Title No. ….

    37.4.4.His interest in the motor vessel and the sailing yacht;

    37.4.5.The money standing to the credit of the Husband in any bank accounts in his sole name including but not limited to:

    ·          the US dollar account;

    ·          the E and W account;

    ·          the cheque account.

    37.4.6.All furniture, furnishings and chattels situated in the residential dwelling at H; and

    37.4.7.The shares held in his name in publicly listed companies.

    Indemnities

38. That the Husband be solely responsible for and indemnify the Wife and keep her indemnified against all liabilities, actions, claims, suits and/or demands of any nature whatsoever:

    38.1.Arising directly or indirectly out of or ancillary to or in anyway connected with the Harlem Group or the Super Fund;

    38.2.In relation to any debt loan account or debt owing to any of the entities in the Harlem Group whether past, present or future including but not limited to any liability that might be occasioned to her by reason of her holding any office in any of the entities in his Harlem Group or the Super Fund or as guarantor in respect of any guarantee (if any) given on behalf thereof jointly with the Husband or otherwise and the Husband shall take such steps as shall be necessary to have her released;

    38.3.Including any liability occasioned to the Wife arising out of any transaction or transfer resulting from these orders or by reason of any distribution to the Wife as a beneficiary to any of the trusts within the Harlem Group, such liability to include stamp duty, income tax, capital gains tax and related charges and/or taxes.

    Miscellaneous Orders

39. That except as these orders provide to the contrary:

    39.1.All documents necessary to transfer any property or give effect to any transaction pursuant to the terms of these Orders be prepared by the party receiving such property of the benefit of such transaction;

    39.2.That the party receiving such property or the benefit of such a transaction be responsible for the payment of taxation, stamp duty, registration fees, legal costs and outlays in relation to effecting the transfer of any property or the receipt of any benefits in such a transaction pursuant to the terms of these orders;

    39.3.That the Husband and Wife mutually release the other in respect of any actions, claims, suits, demands and debts as against the other.

40. That the parties comply with all requisitions issued by the Office of State Revenue in relation to any document executed or transaction entered into pursuant to, or to put into effect, by these Orders.  In default of either of the parties complying with any requisition so issued within 14 days of the date upon which any requisition issues, the party not in default shall be entitled to comply with any of the outstanding requisitions and recover from the other party in default, the costs and outlays incurred in complying with the requisition, such costs to be calculated in accordance with the Family Law Rules. 

41. That in the event that any party to these orders refuses or neglects to comply with any or all of the provisions of these Orders, the Registrar or a Deputy Registrar of the Family Court of Australia at Brisbane is hereby appointed, pursuant to s.106A of the Family Law Act, to execute all deeds and documents in the name of the Husband, the Second Respondent and/or the Wife and to do all acts and things necessary to give validity and operation to these Orders.

42. That unless otherwise specified in these Orders and save for the purposes of enforcing any monies due under these or any subsequent orders:

    42.1.Each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession and/or name of such party as at the date of these orders;

    42.2.Insurance policies remain the sole property of the owner named in the policy;

    42.3.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 these Orders;

    42.4.Any joint tenancy of the parties in any real or personal estate is expressly severed.

    Spousal Maintenance

43. That the application of the Wife for periodic and/or lump sum spousal maintenance be dismissed.

    Child Maintenance

44. That the application of the Wife for Orders for a departure from the administrative assessment of child support be dismissed.

    Procedural and Other Orders

45. That all applications be otherwise dismissed and the proceedings removed from the pending cases list.

46. That the orders of this Honourable Court dated 16 March 2006 and 2 August 2006 be discharged 30 days after the Husband does both of the following things:

    46.1.Makes the cash payment to the Wife pursuant to paragraph 33 of these orders; and

    46.2.Executes a transfer in favour of the Wife pursuant to paragraph 30 of these orders.

47. Certify for Counsel and Senior Counsel.

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

FAMILY COURT OF AUSTRALIA AT BRISBANE

FILE NUMBER: BRF 3862 of 2005

Mrs Harlem

Applicant

And

Mr Harlem

Respondent

REASONS FOR JUDGMENT

Background to the Proceedings

1.The Applicant Wife and the Respondent Husband are aged 39 and 47, respectively, and commenced their relationship in October 1992.  The parties dispute the precise date when cohabitation commenced.  The Applicant Wife alleges September 1993, whereas the Respondent Husband alleges May 1994.  In any event, the parties married in September 1994.  Shortly thereafter in December of the same year the Applicant Wife ceased her employment as a personal assistant.  Their first child was born in February 1995, and their second child in June 1997.  These children are the subject of parenting proceedings in this matter.

2.The Applicant Wife's sister passed away in November 2000, which reportedly caused significant distress to the Applicant Wife.  A significant consequence of this development was the extent to which it exacerbated the Applicant Wife's alcohol consumption.  The parties separated under one roof in October 2002, but the Respondent Husband moved out of the family residence in November 2002.  In August 2004 the Respondent Husband commenced a relationship with another woman.  Some time later in the same year the Applicant Wife learned of that relationship and accordingly altered her sleeping arrangements with the Respondent Husband.  On 29 December 2005, the Applicant Wife commenced these Family Court proceedings.

3.It is uncontested that the Respondent Husband had established his entrepreneurial business prior to the commencement of the parties' relationship.  The parties disputed the valuation of the business at that time but it has since been the subject of a joint statement from the adversarial experts in this case, who have come to an agreed figure.  The present value of that business, however, remains contested and is at large.  Each of the experts has returned divergent figures with a difference of approximately $1 million.  In addition to the family business, the Respondent Husband has caused the acquisition of various real estate properties through the vehicle of a family trust, both during and subsequent to the parties' relationship.

4.Applications subsist before this Court in the form of parenting, financial, and child support.  They are each addressed in turn.

Parenting matters

5.In these proceedings the Court is well assisted by the Family Report prepared by Dr M who recommends that the status quo continue on foot.  Having read the report, I adopt his findings and the reasons thereto.  Mindful as I am, however, of the need to articulate the extent to which the best interests of the child are served in relation to relevant s 60CC factors, I make the following observations.  In this regard, I note that I have not reviewed the entirety of those factors listed in s 60CC but have merely emphasised those factors that best highlight the facts, which I discuss below, that have persuaded me to make such findings and conclusions in relation to the parenting component of this matter as I have made.

6.The Respondent Father amended his application from one for spending time with the children, to one seeking shared parental responsibility during the course of the proceedings, but this was not strongly pressed.  Nonetheless, it is of particular benefit for each of the children to have a meaningful relationship with both of their parents.[1]  In this regard it is suggested that the parents will ultimately put the needs and wants of their children above and beyond any conflict that has subsisted whilst litigation has remained on foot.

[1] Family Law Act 1975 (Cth), s 60CC(2)(a).

7.From the material before the Court there is some indication that there is a threat of harm to the attitudes of the children from the high conflict relationship between their parents.  This may manifest itself as psychological harm.[2]  The high conflict manifest itself most grossly in an incident reported in the affidavits where the Applicant Mother drove her vehicle through the boom gate at the Respondent Father's work, so enraged was she upon learning of the latter's relationship with his new partner.

[2] Family Law Act 1975 (Cth), s 60CC(2)(b).

8.The children are both of an age where there views should be taken into proper consideration by a court that purports to alter their living arrangements.[3]  The views held by the children, as reported to the Court by Dr M, are that they do not wish for any change to the current parenting regime.  Dr M endorses those views in his Family Report, and I accept and adopt them.  In this regard I note that the Respondent Father's application for shared parental responsibility substantively calls for only a minor variation to the existing arrangements.  It is suggested that the Respondent Father's relationship with his children will not suffer for not ceding to that application, but instead maintaining the status quo as proposed by Dr M and the children themselves.

[3] Family Law Act 1975 (Cth), s 60CC(3)(a).

9.As to the nature of the relationship of the children with each of their parents,[4] it cannot be said more plainly than that both children love each of their parents dearly.  All that they ask for is to share in that love in a non-contentious environment and without the ongoing conflict that has been present whilst these proceedings have subsisted.  To that end, the Court ultimately believes that both of the parents will rise above the conflict in which they have become entrenched for the sake of their two children.[5]

[4] Family Law Act 1975 (Cth), s 60CC(3)(b).

[5] Family Law Act 1975 (Cth), s 60CC(3)(c).

10.As noted above, and for the foregoing reasons, it is not purported to alter the existing parental arrangements.  Those arrangements shall concretise as final orders, save that both parents shall have equal shared parental responsibility for the long-term care of the children, and each parent shall have day-to-day parental responsibility individually whilst either or both of the children are in their respective care.

Financial matters

11.The determination of financial matters between the parties involves a three step process of long-standing authority.[6]  These steps include the identification of the property of the parties, an assessment of the parties' respective contributions as per s 79(4) of the Act, and a consideration of the parties' needs and resources as per s 75(2) of the Act.  There is a final additional requirement that the Court be satisfied that the settlement is just and equitable.[7]

[6] See, for example, In the Marriage of Clauson (1995) 18 Fam LR 693.

[7] Family Law Act 1975 (Cth), s 79(2).

Identifying the property of the parties

12.Based upon the submissions of counsel, it is apparent that there is no real dispute as to the assets and liabilities of the parties save for the family business, which has been the subject of protracted dispute between adversarial expert witnesses.  Given that all other values are agreed, the remainder hereto focuses solely on the question of the value to be ascribed to that business.

The value of the business at the commencement of the relationship

13.The adversarial experts in this matter issued a Joint Statement to the effect that there was no substantial difference between their valuations of the business at the inception of the parties' relationship and, further, that any such valuation ought to not include any goodwill component having regard to insufficient earnings.[8]  Such expert evidence exists in the context of assertions by the Respondent Husband that the product and business connections that constitute the subject business existed prior to the commencement of the relationship.  In light of the absence of goodwill, however, it is apparent that the business cannot be said to constitute a substantial initial contribution to the property of the relationship.  Notwithstanding that fact, I prefer to adopt the valuation ascribed by the expert for the Applicant Wife – as I do for the present valuation of the business – in the sum of $34,234.

[8] Joint Statement of Experts, p 3.

The value of the business at the dissolution of the relationship

14.The most contentious issue as to the valuation of the parties' assets pertains to the value of the family business as it presently stands.  There are three areas of dispute to be addressed, including the value of goodwill subsisting in the business, the extent of future maintainable profits of the business, and the capitalisation rate to be applied.  The overall value that I would ascribe to the business, however, necessary encapsulates the concerns in each of these respects to the extent that I prefer the evidence of Mr D over that of Mr O.  I cannot possibly accept the suggestion of Mr O that the business has no value to anyone other than the Respondent Father.

15.Whatever apparent difficulties there might be in crystallising the otherwise ephemeral agreements-by-handshake that hold the business together, as a matter of law it can be safely said that a court of competent jurisdiction would have no difficulty in solidifying such agreements based upon the history of the company's trading relationships.  In any event, there is value in the business.  That value is as assessed by Mr D and, further, includes his findings in relation to goodwill, future maintainable profits, and capitalisation rate.  In this regard I reject the evidence of Mr O outright. On Mr D’s analysis, the business is valued at $4.1 million.

Superannuation entitlements

16.Cognisant of the comments of the Full Court in Coghlan,[9] the superannuation entitlements of each of the parties must be considered in assessing the contributions of the parties; that is, the manner and extent to which the parties each contributed to the superannuation entitlements of both of them must be considered in accordance with s 79.  Beyond that, however, that case retains the trial Judge's discretion as to whether superannuation should be included as a single-line asset in a global approach to the property pool or, alternatively, considered as a separate pool unto itself.

[9] (2005) 33 Fam LR 414.

17.Having regard to the Respondent Husband's submissions in this respect, however, in the instant case it is unnecessary to separate the superannuation entitlements from the overall pool of assets.  The Respondent Husband has directly contributed to and managed the parties' superannuation himself, and the division of property set forth in the attendant Orders is such that the Applicant Wife will retain the entitlement to her superannuation as part of her share in the matrimonial property.  There is no need to draw upon the Respondent Husband's superannuation entitlement in order to satisfy the Applicant Wife's share.  In this respect, therefore, it is appropriate that the Respondent Husband do all things necessary to transfer the Applicant Wife's superannuation entitlements under his control to a nominated superannuation fund of the Applicant Mother's choice.

Assessing the parties' contributions

18.In assessing contributions pursuant to the exercise of the Court's discretion to alter the parties' property interests, the Court must assess the contributions of the parties as identified in s 79(4) of the Act.  These contributions may take the form of financial contributions to the acquisition, conservation, and improvement of property, and non-financial contributions to property and contributions to the welfare of the family.

Global or asset-by-asset approach

19.In assessing the parties' contributions, counsel for the Respondent Husband urged the Court to adopt an asset-by-asset as opposed to a global approach.[10]  As was clarified by the High Court in Norbis v Norbis it is upon the trial Judge to adopt that approach that will best ensure a just and equitable result for the parties and that neither approach is prescriptive.[11]  It was also noted in that case that whilst the application of a particular approach is not an appealable error of law, the global approach is preferred in the majority of cases.[12]  Counsel for the Respondent Husband urged the adoption of the asset-by-asset approach having regard to the following factors:[13]

·   The relatively short nature of the marriage (8 years)

·   The length of the separation (over 5 years)

·   The discrete nature of the assets owned by the Husband at the date of the marriage

·   The discrete nature of the contributions made by the parties during the marriage

·   The discrete nature of the parties [sic] contributions since separation

·   The nature of the change in the asset position of the parties since separation

·   The ability of the Court in this case to make an assessment of those factors set out in s79 as applied to the individual assets of the parties.

[10] Written Submissions of the Respondent Husband (Property), 36.

[11] (1985) 161 CLR 513.

[12] Ibid.

[13] Written Submissions of the Respondent Husband (Property), 36.

In support of these arguments counsel for the Respondent Husband cited Full Court authority in the form of McMahon and Zalewski, respectively focusing on the duration of the relationship and the delay between separation and instituting of property proceedings as grounds for deviating from the global approach.[14]  Mr Kirk for the Applicant Wife does not address this matter in his written submissions.

[14] In the Marriage of McMahon (1995) 19 Fam LR 99; Zalewski v Zalewski (2005) 34 Fam LR 296.

20.Despite Mr Favell's argument on behalf of the Respondent Husband that the contributions should be assessed on an asset-by-asset basis, I believe that there are compelling reasons for adopting a global approach to the property pool.  Not only is the process far less painful for all involved, but further that the vast majority of the assets in the pool were acquired by the Respondent Husband during or after the separation.  Such an approach would unduly prejudice the interests of the Applicant Wife in these proceedings and, in the interests of justice, it is appropriate that a global approach be applied.

Initial contributions to the property of the relationship

21.The major initial contribution to the property of the relationship was by the Respondent Husband, with the Applicant Wife contributing little to no assets that have been evidenced.  As noted above, the adversarial experts in this matter issued a Joint Statement to the effect that there was no substantial difference between their valuations of the business at the inception of the parties' relationship and, further, that any such valuation ought to not include any goodwill component having regard to insufficient earnings.[15]  The findings in respect of the extant to which the business can be said to constitute an initial contribution on behalf of the Respondent Husband are thus such that any such contribution must be limited to the agreed valuation.

[15] Joint Statement of Experts, p 3.

22.Further, the Respondent Husband contributed real property in the form of the matrimonial home, which still exists as one item amidst the family's real estate holdings and is the subject of this dispute.

Contributions during the subsistence of the relationship

23.Contributions of the Applicant Wife.  It is necessary to have regard to the Applicant Mother's non-financial contributions to the matrimonial property and the welfare of the family.[16]  Whilst acknowledging that such contributions must be treated as significant and not merely token as a matter of principle,[17] it is necessary that the evidence reflect the fact that such a contribution actually occurred.  Nonetheless as Justice Nygh noted in In the Marriage of Aroney:[18]

It cannot be doubted that [the Wife] did contribute to as a homemaker and parent. She is not disqualified as a homemaker because she had domestic help and did little physical work around the house. … She acted as hostess and organised the household.  There was no allegation that she failed as a parent.

[16] Family Law Act 1975 (Cth), s 79(4)(b)-(c).

[17] In the Marriage of Prpic (1994) 18 Fam LR 388.

[18] (1979) 5 Fam LR 535 at 544 per Nygh J.

24.Therefore, despite the Applicant Wife's inconsistent statements referred to by counsel for the Respondent Husband as to the level of external support she received in the form of nannies and housekeepers,[19] that fact of itself is insufficient to disentitle the Applicant Wife to a share in the matrimonial property.  The Applicant Wife contributed to the relationship through childminding and domestic duties, and made minor contributions to the family business in the form of administrative support.  These contributions entitle the Applicant Wife to 20% of the matrimonial estate.

[19] Written Submissions of the Respondent Husband (Property), 7.

25.Contributions of the Respondent Husband.  It is not disputed that the Respondent Husband has contributed to the material well-being of the marriage through his management of the family business and his financial contributions thereto.  The sizeable profits and maintainable future earnings of that business, which is entirely of his creation, constitute the vast majority of the matrimonial assets.  As noted above, that business is valued at approximately $4.1 million.

Contributions since the separation of the parties

26.The Applicant Wife has made no contribution post-separation that has been raised before the Court.  Indeed, as noted elsewhere, the Applicant Wife appeared to only incur more debt on the part of the matrimonial estate.  That increased debt constitutes part property settlement unto her, and she will be entirely independently responsible for servicing that debt.

27.The Respondent Husband, to the contrary, has acquired a number of real estate holdings through the family investment trust vehicle.  These properties include those at B and G. Indeed, these acquisitions stand in stark contrast to the claims made by Mr O as adversarial expert for the Respondent Husband that the family business is of little to no current or future value.  Certainly the monies to purchase such holdings – and a yacht – must be derived from that business's profits.  These contributions necessarily form part of the matrimonial estate, but the Respondent Husband's role in solely bringing them into existence is duly noted.

Considering the parties' needs and resources

28.Insofar as the amount to be allocated to the Respondent Husband by virtue of his contributions to the marriage is indisputably sufficient to cover his own needs, it is not necessary to consider the s 75(2) factors in relation to him.[20]  The following discussion therefore focuses solely on the Applicant Wife and her needs and resources.  Counsel for the Respondent Husband appropriately concedes in his written submissions that the Applicant Wife is entitled to an adjustment with due regard to the s 75(2) factors.[21]

[20] In the Marriage of Kelly (No 2) (1981) 7 Fam LR 762 at 774 per curiam.

[21] Written Submissions of the Respondent Husband (Property), 50.

The income, property, and financial resources of each of the parties

29.Having regard to the contributions to the marriage as outlined above, it is abundantly clear that the Respondent Husband will possess a vast accumulation of wealth whereas the Applicant Wife will have little in the form of income or property beyond that conferred upon her in these proceedings.  This vast disparity is certainly a matter for consideration, however.  Despite Mr O’s concern as to the financial position of the Respondent Husband, on any view of the evidence he will be in a very good position from such an enormous amount of money.  Conversely, the Applicant Mother will likely be unable to engage in much by way of gainful employment, but considering her position under the Orders made herein she will be in a much stronger financial position.  Consequently, the Applicant Wife should receive a further 2.5%.  This might appear somewhat harsh on the face of it, but I note that the amount the Wife will receive in capital, if invested, would deliver a return similar to the monthly rate of spousal maintenance that she originally applied for.

The care and control of the children of the marriage

30.The Applicant Wife will have the care and control of both children of the marriage, but the elder child will be an adult comparatively soon.  The younger child, however, has some many years to go.  Notwithstanding that the Applicant Wife will have the physical possession of the children, it is common ground that the Respondent Husband has paid for and will continue to pay for much of the major expenses in the children's lives, including school fees and medical expenses.  It is apparent in this regard that the Applicant Wife would only need to cater for their day-to-day expenses.  In that light, I am minded to increase the distribution to the Applicant Wife by 5%.

A standard of living that in all the circumstances is reasonable

31.As noted elsewhere, the Respondent Husband will continue to live an entirely reasonable – if not more than reasonable – lifestyle in financial terms.  The Applicant Wife, though not endowed with the same financial resources as her former partner and not likely able to attain gainful employment, will nonetheless be well provided for under the terms of this s 79 distribution.  This is all the more apparent when one considers that the vast majority of the children's major expenses will continue to be paid by the Respondent Husband directly into the future.

The terms of any order made or proposed to be made under s 79 of the Act in relation to the property of the parties

32.During the course of the trial, the Applicant Wife received moneys from the Respondent Husband in partial property settlement to allow her to pay out the outstanding debt on her credit cards so that she could live comfortably until the final property settlement had been determined.  In defiance of this Order, however, the Applicant Wife paid out those debts but shortly thereafter had accrued indebtedness to her allowed maximum once more.  The Applicant Wife's conduct in this regard must necessarily inform the Court's discretion.

33.The Respondent Husband also raises the assertion that the real estate holdings he has acquired since separation are pregnant with capital gains tax and that liability, which will eventually become due upon subsequent sale, should be taken into account when assessing the value of the property for the purposes of s 79.  In this regard, I refer to the principles as stated in Rosati v Rosati, and note that insofar as there is uncontested evidence before the Court that the properties were "acquired solely as an investment and with a view to its ultimate sale for profit",[22] the capital gains tax liability should be taken into account.  Thereto, it is suggested that to the extent that the properties cannot be said to have been purchased as a primary residence or for business purposes, the properties must be taken to have been acquired as investments.  Therefore, the capital gains tax liability should be considered in assessing their value.

[22] In the Marriage of Rosati (1998) 23 Fam LR 288 at [6.36].

A just and equitable result

34.Having regard to the contributions of the parties and the totality of the s 75(2) factors,[23] it is purported to declare a 27.5% interest in the property pool in favour of the Applicant Wife.  The total value of the property pool is $9,866,097, including legal fees and partial property settlements.  The Applicant Wife's 27.5% share of that pool thus totals $2,713,177.  It is further noted that the after-acquired real estate are assets of the trust vehicles and, to that end, their value is considered therein.  The property pool in its entirety is set out as follows, reproduced from Annexure A of the Applicant Wife's written submissions and, on advice from both counsel, as agreed inter partes (and adjusted to reflect the views contained above):

[23] In the Marriage of Lawler (1988) 12 Fam LR 319 at 327 per Gee J.

1	Realty
(a)	Former home – C property (J)	$1,800,000
Mortgage	(377,529)
(b)	N Property	$1,050,000
Mortgage	(205,000)
(c)	Units 8, 10 & 16 M Street (H)	$705,000
Mortgage	(455,000)
(d)	L property (½ H)	$165,000
Mortgage	(19,336)
…
2	Corporate/Trust Interests
(a)	M Pty Ltd	$4,116,724
(b)	Harlem Family Discretionary Trust (HFDT)	$35,866
(c)	Harlem Property Trust (HPT)	$325,381
(d)	Harlem Investment Trust (HIT)	$2,089,937
(e)	A Pty Ltd	…
(f)	Loans to / by:
M Pty Ltd to Husband	(1,089,764)
HFDT to Husband	(52,001)
3	Superannuation Entitlements (Harlem Super Fund)
Wife's Interest	$151,665
Husband's Interest	$643,139
4	Yacht / Boats
(a)	Motor vessel (½ H)	$8,833
(b)	Yacht (½ H)	$125,000
Mortgage	(125,000)
5	Other Assets
(a)	Share Portfolio
Wife's Interest	$1,752
Husband's Interest	$211,717
Mortgage	(97,561)
(b)	Furniture
Wife	$5,695
Husband	$10,080
N property	$7,670
(c)	Wife's Jewellery	$1,950
(d)	Wife's Motor Vehicle (Land Cruiser)	$23,500
(e)	Bank Accounts
Wife's NAB 221	$5
Wife's NAB 561	$1,060
Husband's NAB 223	$4,722
Husband's NAB 209	$143,251
…
6	Liabilities
…
(b)	Husband's Credit Card	(7,500)
ACTUAL POOL	$9,199,256
Notional Adjustments
(a)	Legal fees paid by Husband	$316,841
(b)	Legal fees paid by Wife (incl. in 7(c)(i) below)
(c)	Partial property settlement payments
(i) to the Wife	$250,000
(ii) to the Husband	$100,000
NOTIONAL POOL	$9,866,097

35.The question of whether or not the property settlement is just and equitable requires adherence to established principles.[24]  Consideration is not to be had to the conduct of the parties during the course of the relationship.[25]  It is entirely relevant to consider, however, whether orders made pursuant to s 79 of the Act deprive a party of an entitlement he or she would be accorded as a result of contributions to the property in question.[26]  It is in this regard that the lion's share of the property pool remains with the Respondent Husband, and justly and equitably so.  As demonstrated above, the Respondent Husband contributed to the establishment of his successful commercial venture with only minimal direct assistance from the Applicant Wife.  The efforts of the Applicant Wife as homemaker and child carer are not, however, overlooked and have been catered for by reference to her contribution, needs, and resources.  The financial orders as stated are thus just and equitable.

[24] In the Marriage of Neale (1991) 14 Fam LR 861 at 866 per curiam.

[25] In the Marriage of Ferguson (1978) 4 Fam LR 312.

[26] In the Marriage of Black and Kellner (1992) 15 Fam LR 343.

36.This is so notwithstanding the Kennon argument raised by counsel for the Applicant Wife.  It was raised by Mr Kirk during argument and in written submissions that "It is little wonder [the Applicant Wife] felt violated, lacked self-esteem and struggled to shoulder the unfair burden the Husband placed upon her."  As counsel for the Respondent Husband points out in his written submissions, however, the Applicant Wife has not led any evidence neither corroborating the reported effects of the alleged abuse, nor demonstrating the manner in which any alleged domestic violence during the course of the relationship has impacted adversely upon her capacity to contribute.[27]  It is not appropriate in these circumstances to make an adjustment for Kennon factors.

[27] Written Submissions of the Respondent Husband (Property), 28.

Child support matters

37.Section 116 of the Child Support (Assessment) Act 1989 (Cth) ('the CSA Act') allows for an application for a departure from an assessment of child support to be brought in the Family Court of Australia where an application is pending in this Court, and the Court is further satisfied that "it would be in the interests of [both parties] for the court to consider whether an order should be made … in the special circumstances of the case".

"Special circumstances"

38.The meaning of the phrase "special circumstances" is not defined in the CSA Act. The Full Court in In the Marriage of Gyselman approved the observations made by Justice Kay in In the Marriage of Savery to the following effect:[28]

Whilst it is not possible to define with precision the meaning of that term, as a generality it is intended to emphasise that the facts of the case must establish something which is special or out of the ordinary. That is, the intention of the Legislature is that the court will not interfere with the administrative formula result in the ordinary run of cases. In Savery's case … Kay J, adopting the view in In the Marriage of Philippe (1977) 4 Fam LR 153 … at … 155 … in a different context, said that “special circumstances” were “facts peculiar to the particular case which set it apart from other cases”. The approach to the interpretation and application of the particular grounds in s 117(2) must be guided by that qualification.

[28] In the Marriage of Gyselman (1991) 15 Fam LR 219 at 224-225 per curiam; In the Marriage of Savery (1990) 13 Fam LR 812 at 815 per Kay J.

39.The Full Court has further held that it cannot be said that the circumstances of a given case are "special" merely because either the applicant has "little, if any, earning capacity" or has the care of the children, or that the respondent will receive funds from a property settlement.[29]  Much of the cases on point denounce certain circumstances as being not special, rather than proposing certain circumstances as being special. Justice Lindenmayer, however, eloquently canvassed two situations that might be paradigmatically considered "special circumstances".[30]  These included "asset rich, income poor" circumstances in relation to underutilisation of funds, and "swings and roundabouts" circumstances in relation to seasonal income.

[29] In the Marriage of Prpic (1994) 18 Fam LR 388 at 397 per curiam.

[30] Dwyer v McGuire (1993) 17 Fam LR 42 at 58 per Lindenmayer J.

40.As noted by the Respondent Husband,[31] the Applicant Wife in her submissions does not address this point.  Neither of Justice Lindenmayer's propositions operates in this case.  Notwithstanding that the Respondent Husband possesses extensive real estate holdings that might be invested in more lucrative assets, it cannot be said that he is "income poor" as a result.  In any event, I am not persuaded that special circumstances exist under the guidance of the Full Court's observations in Gyselman that warrant intervention by this Court.

[31] Written Submissions of the Respondent Husband (Child Support), [7].

Grounds for departure

41.In the event that such an observation is incorrect it is necessary to consider whether or not one or more of the grounds of departure in s 117(2) of the CSA Act are made out and if they are, further, that it be just and equitable and otherwise proper that a departure order be made. The grounds for departure relied upon by counsel for the Applicant Wife as stated in his written submissions are the children's needs and the husband's capacity to meet those needs.[32] These submissions would appear to correlate with the grounds in s 117(2)(b)(ia) and (c)(ia).

[32] Written Submissions of the Applicant Wife, [7.2]-[7.3].

42.In relation to s 117(2)(b)(ia), "in the special circumstances of the case, the costs of maintaining the child are significantly affected … because of special needs of the child", Justice Kay stated in In the Marriage of Blamey that "special" ought to be interpreted in the Gyselman sense.[33]  That is, the children must be seized of some need that requires particular financing.  The orders sought by the Applicant Wife include that the Respondent Husband pay for the children's private health insurance premiums and education costs, as well as an additional sum of $3,940 per month.[34]  The written submissions prepared by counsel for the Respondent Husband, however, concede that the Respondent Husband will pay "the children's private health insurance premium … together with school fees",[35] inter alia.  The dispute appears to centre on the additional sum.

[33] (1994) 18 Fam LR 481 at 488 per Kay J.

[34] Written Submissions of the Applicant Wife, [7.1].

[35] Written Submissions of the Respondent Husband (Child Support), [13].

43.The needs of the children as suggested by the Applicant Wife are set out in her affidavit.[36]  It is not necessary to reproduce the schedule here.  Counsel for the Respondent Husband challenges the reasonableness of these claimed needs,[37] but Mr Kirk for the Applicant Wife maintains that their reasonableness is now beyond question insofar as the deponent was not challenged under cross-examination.[38]  Notwithstanding the question of whether the "needs" are in fact reasonable it is not readily apparent that any of the needs listed could be said to be "special" in order to satisfy the ground for departure.  The written submissions of the Respondent Father do not address the point expressly, but appear to assert that whatever special needs that exist are adequately covered by existing or future payments undertaken by the Respondent Father.[39]

[36] Affidavit in Chief of the Applicant Wife, [362].

[37] Written Submissions of the Respondent Husband (Child Support), [10].

[38] Written Submissions of the Applicant Wife, [7.2].

[39] Written Submissions of the Respondent Husband (Child Support), [19].

44.The thrust of Mr Kirk's second argument, however, is that the Respondent Husband should pay more by way of child support because he has the income, property and financial resources to do so.[40]  The ground that the Applicant Wife appears to relies on requires that the "administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided" by the Respondent Husband.[41]  It is also relevant to consider, however, any other payments that are made for the benefit of the children,[42] as raised by Mr Favell for the Respondent Husband.[43]  These payments include "car registration, car insurance, petrol, the wife's private health insurance and dental costs, all mortgage payments, rates, mower/yard expenses, pool expenses, cleaning costs, broadband internet connection and [subscription television]."[44]  The Respondent Husband has also undertaken to pay for "the children's private health insurance premium [as noted above], medical, dental and orthodontic expenses together with school fees [as noted above], computer costs including broadband connection and extracurricular activities."[45]

[40] Written Submissions of the Applicant Wife, [7.3].

[41] Child Support (Assessment) Act 1989 (Cth), s 117(2)(c)(ia).

[42] Child Support (Assessment) Act 1989 (Cth), s 117(2)(c)(ii).

[43] Written Submissions of the Respondent Husband (Child Support), [10].

[44] Ibid.

[45] Ibid [13].

45.I am not persuaded that the children are possessed of any special needs that dictate a departure from child support as assessed. This is particularly so in light of the additional payments that the Respondent Father presently makes and has undertaken to make into the future. Further, I am not moved to find that the support obligations are unjust and inequitable having regard to the evidence of those additional payments just referred to. In addition, the CSA Act also demands reference to "any transfer or settlement of property made or to be made" to the Applicant Wife.[46]  In this regard it is noted, in concurrence with counsel for the Respondent Husband, that upon finalisation of these proceedings in light of the above, the Applicant Wife "will be a very wealthy woman".[47]

[46] Child Support (Assessment) Act 1989 (Cth), s 117(2)(c)(ii).

[47] Written Submissions of the Respondent Husband (Child Support), [23].

46.Having regard to the foregoing I am not persuaded on the evidence before the Court that any ground for departure from child support as assessed has been made out.  It is therefore strictly unnecessary to consider the further matters of whether it is just and equitable or otherwise proper to so depart.  In the event that I am incorrect in that finding, however, I would consider not consider that either of those criteria are made out for the reasons stated above.  The application in respect of child support is thus dismissed.

I certify that the preceding forty-six (46) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Bell.

Associate: 

Date: