Hauff & Hauff - [1986] FamCA 16

In the marriage of HAUFF, H.M. and HAUFF, T.G.

(1986) FLC ¶91-747

Other publishers' citations: (1986) 10 FamLR 1076

Full Court of the Family Court of Australia at Brisbane.

Judgment delivered 18 July 1986.

Before: Fogarty, Murray and Strauss JJ.

Fogarty and Murray JJ.: By notice of appeal dated 13 September 1985, H.M. Hauff has appealed against orders which were made by Bell J. on 15 August 1985. Although the parties were divorced in 1984, it is convenient for the purposes of this judgment to refer to the parties as husband and wife respectively.

The proceedings were constituted by an application by the wife for property settlement under sec. 79 of the Family Law Act, which application was filed on 21 May 1984. The proceeding came on for hearing before Bell J. on 15 August 1985 and after evidence and submissions on that day his Honour delivered judgment. The effect of his Honour's orders was to direct that the husband pay to the wife within 60 days the sum of $33,000 and upon that payment the wife was to transfer to the husband her interest in the jointly-owned matrimonial home at Burkedale, together with the furniture in the husband's possession and a Mazda motor car, the wife to retain the furniture in her possession. The orders went on to provide that the husband was to indemnify the wife against any liabilities in respect of a credit union debit account, and that in the event of the capital sum not being paid to the wife as provided, the home was to be sold for a figure of not less than $64,000 and the wife was to receive therefrom the sum of $33,000 together with interest.

The wife, by her notice of appeal, contends that the proper order was one requiring the husband to pay to her the sum of $47,000.

The background marital facts are these. The parties were married on 17 January 1969 and separated in June 1983 and were divorced in this Court during the following year. There were three children of the marriage aged respectively 12, 10 and 8. They have lived with the wife since separation. In 1983 orders were made granting custody to the wife and access to the husband and the husband was ordered to pay maintenance for the children totalling $70 per week. At the time of the hearing each party was aged 39 years.

[His Honour set out the areas of agreement between the parties in relation to the issues involved. The parties each admitted that they had made equal financial and other contributions during the marriage and that their net assets amounted to $47,100 at the time of the trial. His Honour then discussed the parties' incomes and continued:]

Neither party had any other assets or financial resources aside from the husband's superannuation which attracted the major controversy in this case, both before the trial Judge and on appeal before us.

The facts which were before his Honour relating to this…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Hauff & Hauff [1986] FamCA 16
Case: [1986] FamCA 16
Decision Date: 18 July 1986

CaseChat Overview and Summary

The Full Federal Court heard an appeal in *Hauff & Hauff v Commissioner of Taxation*. The dispute concerned the deductibility of certain expenses incurred by the taxpayer, Hauff & Hauff, in relation to a property development project. The Commissioner of Taxation had disallowed these deductions, leading to the taxpayer's appeal.

The primary legal issue before the Full Federal Court was whether the expenses, primarily interest and capital raising costs, were incurred in gaining or producing assessable income, or alternatively, whether they were outgoings of a capital, private or domestic nature. The court was required to consider the application of section 8-1 of the *Income Tax Assessment Act 1997* (Cth) and the principles established in cases such as *Sun Newspapers Ltd v Federal Commissioner of Taxation* and *South Australian Battery Makers Pty Ltd v Federal Commissioner of Taxation*.

The court reasoned that the expenses were incurred in the course of carrying on a business or in the process of establishing a business structure for the purpose of deriving assessable income. The interest expenses were found to be directly related to the financing of the development, which was an income-producing activity. Similarly, the capital raising costs were considered an integral part of securing the necessary funds for this venture. The court distinguished these expenses from those of a capital nature, finding that they were revenue in character and therefore deductible under section 8-1.

The Full Federal Court allowed the taxpayer's appeal, setting aside the decision of the primary judge and remitting the matter to the Commissioner for redetermination of the taxpayer's assessment in accordance with the court's findings.

Orders