Headon and Bolger

[2013] FCCA 172

FEDERAL CIRCUIT COURT OF AUSTRALIA

HEADON & BOLGER [2013] FCCA 172

Catchwords:
FAMILY LAW – Property – initial contributions – favour husband – wasting of assets – not found – a poor business venture – inclusion of capital gains tax liability – not applicable – no immediate sale on evidence.

Legislation:

Family Law Act 1975, ss.43, 75, 79, 81, pt. VIII

C & C (2005) FLC 93-220
In the marriage of Clauson & Clauson (1995) FLC 92-595
Kouper & Kouper (No. 3) [2009] FamCA 1080
Pierce v Pierce (1999) FLC 92-844
Rosati & Rosati (1998) FLC 92-804
Stanford & Stanford (2012) FLC 93-518

Applicant: MS HEADON

Respondent: MR BOLGER

File Number: BRC 5795 of 2011

Judgment of: Judge Cassidy

Hearing dates: 20 & 21 March 2013

Date of Last Submission: 21 March 2013

Delivered at: Brisbane

Delivered on: 17 May 2013

REPRESENTATION

Counsel for the Applicant: Mr Linklater-Steele

Solicitors for the Applicant: Best Wilson Family Law

Counsel for the Respondent: Mr Hamwood

Solicitors for the Respondent: Hede Byrne & Hall

ORDERS

1. That by way of property settlement adjustment, upon there being an accounting of the net assets of the Respondent Husband and Applicant Wife, there be a cash adjustment to the Applicant Wife calculated pursuant to Order 3 hereof, so as to effect a 49%;51% overall distribution of the net assets with 49% to the Applicant Wife.

2. That the cash adjustment described in Order 1 be paid by the Respondent Husband to the Applicant Wife within sixty (60) days of the date of these Orders by way of bank cheque made out to “Best Wilson Family Law Trust Account cr/acc Ms Headon”.

3. That the cash adjustment to be paid to the Applicant Wife, to achieve a distribution of the net assets pursuant to Order 1 hereof, be calculated as follows:

   X = [NP x 49%]-W:

   Where:

   “X” is the amount to be paid to the Applicant wife on the terms stipulated in Order 2 hereof

   “NP” is the net value of the total property and liabilities of the Applicant Wife and the Respondent Husband as at the date of trial in these proceedings; and

   “W” is the net value of the property and liabilities that the Applicant Wife will retain as set out in these Orders.

4. That the parties shall forthwith do all acts and things and sign all such documents as may be necessary (including but not limited to any relevant transfer and/or refinance documentation) to ensure that the Applicant Wife:

   (a)Receive and retain all right, title and interest in and to the following items for her sole use and benefit to the exclusion of the Respondent Husband:

   (i)The real property located at Property H, in the State of Queensland (more particularly described as Lot (omitted) on RP (omitted), County of (omitted), Parish of (omitted), Title Reference (omitted));

   (ii)The real property located at Property H, in the State of Queensland (more particularly described as Lot (omitted) on RP (omitted) and Lot (omitted) on RP (omitted), County of (omitted), Parish of (omitted), Title References (omitted) and (omitted)) subject to Orders 6 and 7 herein;

   (iii)The real property located at Property T, in the State of Queensland (more particularly described as Lot (omitted) on RP (omitted), County of (omitted), Parish of (omitted), Title Reference (omitted));

   (iv)The cash savings held in her individual name including but not limited to cash savings held in the following bank accounts:

   A.(omitted) Bank account number (omitted);

   B.(omitted) account number (omitted);

   C.(omitted) Bank account number (omitted);

   (v)Her interest in the company (omitted) Pty Ltd (ACN: (omitted));

   (vi)The furniture and contents in her possession; and

   (vii)The (omitted) Range Rover motor vehicle in her possession;

   (b)Retains sole responsibility for, and indemnifies the Respondent Husband in respect of, any and all liabilities (including but not limited to any taxation liabilities whether past or present and any credit card liabilities or personal loans) held in her individual name or encumbering any property which she retains pursuant to these Orders including but not limited to the:

   (i)(omitted) credit card held in her name (referable to account number (omitted));

   (ii)(omitted) Visa credit card held in her name (referable to account number (omitted));

   (iii)Everyday Woolworths credit card held in her name (referable to account number (omitted)).

5. That the parties shall forthwith do all acts and things and sign all such documents as may be necessary (including but not limited to any relevant transfer and/or refinance documentation) to ensure that the Respondent Husband:

   (a)Receive and retain all right, title and interest in and to the following items for his sole use and benefit to the exclusion of the Applicant Wife:

   (i)The real property located at Property S in the State of Queensland (more particularly described as Lot (omitted) on RP (omitted), County of (omitted), Parish of (omitted), Title Reference (omitted));

   (ii)The boat and trailer in his possession;

   (iii)The cash savings held in his individual name including but not limited to cash savings held in the following bank accounts:

   A.(omitted) Bank Account number (omitted);

   B.(omitted) Bank Account number (omitted);

   C.(omitted) Bank Account number (omitted);

   (iv)The furniture and contents in his possession;

   (v)His interest in the company (omitted) Pty Ltd (ACN: (omitted));

   (vi)His interest in the company (omitted) Pty Ltd; and

   (vii)Any superannuation entitlements held within his member’s account within the self-managed superannuation fund known as the “Bolger Superannuation Fund”;

   (b)Retains sole responsibility for, and indemnifies the Applicant Wife in respect of any and all liabilities (including but not limited to any taxation liabilities whether past or present and any credit card liabilities or personal loans) held in his individual name or encumbering any property which he retains pursuant to these Orders including but not limited to the (omitted) Bank Visa credit card held in his name (referable to account number (omitted)).

6. That:

   (a)The Applicant Wife indemnify and keep indemnified the Respondent Husband in relation to any liability with respect to the mortgage with the (omitted) Bank Account number (omitted) over the property situate at Property H, in the State of Queensland in the amount of approximately $144,417.00 and take such steps as may be necessary to cause the mortgage debt to be refinanced and the Respondent Husband to be released from any liability in relation to that mortgage debt;

   (b)Should the Applicant Wife be unable to refinance the mortgage debt within forty (40) days referred to in paragraph 6(a) herein so as to release the Husband, the property at Property H shall be sold and the balance proceeds of sale, after the costs of sale and the discharge of the mortgage debt, be divided 49% to the wife and 51% to the husband.

7. That should the Respondent Husband not facilitate the cash adjustment as contemplated by Order 2 and calculated in accordance with Order 3 within the prescribed timeframe then the Respondent Husband shall be deemed to have “defaulted under the Orders” and:

   (a)The real property located at Property S in the State of Queensland (in this Order 7 referred to as “the property”) shall be listed for sale by way of private treaty with an agent as agreed between the parties and if there is no agreement between the parties within fourteen (14) days of the date the Respondent Husband defaults under the Orders, the agent shall be nominated by the CEO of the Real Estate Institute of Queensland (and the costs of that appointment be borne solely by the Respondent Husband);

   (b)The listing price for the property shall be as agreed between the parties and if there is no agreement within fourteen (14) days of the date the Respondent Husband defaults under the Orders, the listing price shall be as advised by the agent appointed pursuant to the preceding subparagraph of this Order;

   (c)In the event that the property has not been sold by or before a date three (3) months after the listing of the property for sale, then the parties shall make all such arrangements and do all such acts and sign all such documents and the Respondent Husband will pay all moneys necessary to procure a sale by public auction of the property upon the following terms:

   (i)The auctioneer shall be as agreed between the parties and if there is no agreement within fourteen (14) days of the deadline date for sale by private treaty (which falls three (3) months after the listing of the property for sale by private treaty), the auctioneer shall be nominated by the CEO of the Real Estate Institute of Queensland (and the costs of that appointment be borne solely by the Respondent Husband);

   (ii)The auction shall take place within one (1) month after the deadline date for sale by private treaty;

   (iii)The reserve price shall, unless agreed upon by the parties within fourteen (14) days of the deadline date for sale by private treaty, be as proposed by the auctioneer;

   (iv)The Respondent Husband is to be responsible for payment of any auction expenses payable before the real property is auctioned.

   (d)In the event that the property has not sold by auction or by private negotiation within the fourteen (14) days following the said auction, then the parties shall do all acts and sign all necessary documents necessary to procure further auction within each subsequent six (6) month period upon the same terms and conditions as applied to the first auction save for the reserve price for the property being lowered by 10% at each auction described in this subparagraph of this Order;

   (e)That from the proceeds of the property the following amounts be paid and disbursed by the parties:

   (i)The reasonable costs, expenses, commissions, advertising fees and disbursements of the agent and/or auctioneer conducting the sale;

   (ii)The reasonable costs and fees of any solicitor acting for the parties in respect of such sale (who will be chosen by the Respondent Husband and to that end the Respondent Husband will pay for any fees payable to that solicitors which are due before the sale of the property);

   (iii)The balance to be distributed as follows:

   A.To the (omitted) Bank, the sum which is sufficient to discharge and release the mortgage (referable to account number (omitted)) encumbering the real property located at Property H, in the State of Queensland;

   B.To the Applicant Wife, the sum sufficient to give effect to Orders 1 and 3 hereof;

   C.The remainder thereafter to the Respondent Husband.

8. That from the date of these Orders, the Respondent Husband will be responsible for and indemnify the Applicant Wife from any outgoings or payments of whatsoever nature required to be made with respect to or in relation to the property located at Property S in the State of Queensland.

9. That from the date of these Orders, the Applicant Wife will be responsible for and indemnify the Respondent Husband from any outgoings or payments of whatsoever nature required to be made with respect to or in relation to the property located at:

   (a)Property H in the State of Queensland;

   (b)Property H, in the State of Queensland; and

   (c)Property T, in the State of Queensland.

10. That the Respondent Husband retain his beneficial interest in, and the Applicant Wife forever and irrevocably relinquishes any entitlement or right she has to be considered as a beneficiary of, the Bolger Trust (ABN: (omitted)).

11. That the Applicant Wife retain her beneficial interest in, and the Respondent Husband forever and irrevocably relinquishes any entitlement or right he has to be considered as a beneficiary of, the Headon Family Trust.

12. That in the event either party refuses or neglects to sign any documents to effect the terms of these Orders (within seven (7) days of a written request to do so), the Registrar of the Federal Circuit Court of Australia, Brisbane Registry, is hereby appointed pursuant to s.106A of the Family Law Act 1975 (Cth), to execute such documents on behalf of the defaulting party.

13. That unless otherwise specified in these Orders:

    (a)The Applicant Wife and the Respondent Husband are each entitled to be the sole legal and beneficial owners of all items of property including money, motor vehicles, insurances, equities, superannuation entitlements and personal effects currently in the possession or control of each of them respectively; and

    (b)The Applicant Wife and the Respondent Husband will each 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 or any liability held in their individual name.

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

FEDERAL CIRCUIT COURT OF AUSTRALIA

AT BRISBANE

BRC 5795 of 2011

MS HEADON

Applicant

And

MR BOLGER

Respondent

REASONS FOR JUDGMENT

Introduction

1. The parties in this matter have competing application for alteration of property interests pursuant to Part VIII of the Family Law Act1975 (Cth) (as amended) (hereafter “the Act”).

The Materials

1. The materials I have considered in this matter, on the applicant wife’s case, were:

   a)Her outline of case document filed on 13 March 2013;

   b)The initiating application filed 16 August 2011;

   c)The wife’s financial statement filed 28 February 2013;

   d)An affidavit of Ms Headon filed on 28 February 2013; and

   e)An affidavit of Ms S filed 13 March 2013.

2. The material that the husband relied upon is:

   a)The husband’s financial statement filed 26 February 2013;

   b)The husband’s response to final orders filed 20 October 2011;

   c)The affidavit of Mr J filed 26 February 2013;

   d)The affidavit of Mr Bolger filed 26 February 2013;

   e)The affidavit of Mr P filed 24 July 2012; and

   f)The affidavit of Mr J filed 24 July 2012.

3. I also considered a number of exhibits, including an updated list of agreed assets:

   a)Exhibit 1 – the wife’s updated list of documents to be relied upon at trial;

   b)Exhibit 2 – the wife’s updated list of assets with a disputed value;

   c)Exhibit 3 – the husband’s objections to the affidavit of the wife affirmed 27 February 2013;

   d)Exhibit 4 – the wife’s objections to the husband’s material;

   e)Exhibit 5 – the tender offer in relation to the (omitted);

   f)Exhibit 6 – the tender offer in relation to the (omitted) Hospital;

   g)Exhibit 7 – the husband’s timesheets;

   h)Exhibit 8 – the timesheets for Mr T and Mr J;

   i)Exhibit 9 – a memorandum from (omitted) dated 20 March 2013;

   j)Exhibit 10 – (omitted) – Business Valuation Information Memorandum; and

   k)Exhibit 11 – the wife’s updated list of assets with an agreed value.

Background Details

1. The husband is presently 58.  He was born on (omitted) 1954.  The wife is 37 and was born on (omitted) 1976.  The parties commenced a relationship in around (omitted) 1999.  They commenced living together on a full-time basis in around (omitted) 2002.  They married on (omitted) 2004 and separated in April of 2010. 

2. The wife’s case is that she and the children had been spending time with the husband from around February of 2001, although the wife lived at (omitted) during the (employment omitted) because of her commitment of having to (employment omitted) there.  The wife had three children when she entered into the relationship with the husband.  They were Mr Z, who is now eighteen years of age and twin girls, X and Y, who are presently fifteen years old.  When the parties commenced living together, Mr Z was seven years old and the twins were four years old. 

The Wife’s Illness

1. It is not in dispute that the wife suffered from depression.  She was diagnosed with depression in or around July of 2007.  In April 2008, the wife took leave from her employment as a (occupation omitted) and she commenced receiving 75% of her income from an income protection insurance policy.  The leave continued until April 2010.  The wife was diagnosed with suffering from a major depressive disorder during the time in 2009 and 2010, and the wife was also diagnosed in 2009 with having a permanent back injury that resulted from a ruptured disk.  The wife retired formally because of ill-health from the (employer omitted) on 13 July 2010.  In December of 2010, the wife received $510,712.69 net, from (omitted) Super, which represented a superannuation payout of $104,895.00 net and a permanent disability insurance payout of approximately $402,599.69.  The wife invested the majority of these funds in the purchase of the (business omitted).  There is very little of that payout remaining today. 

The Parties’ Real Properties

Property S

1. At the commencement of the relationship, there is no dispute that the husband was the registered proprietor of and owned Property S.  That property was the husband’s home and the wife and the children moved into that property when they all commenced residing with the husband full-time in (omitted) 2002. 

Property C

1. In 2003, the parties purchased an investment property at Property C.  They used the Property S property as security for the purchase.  In around August of 2005, the parties sold the Property C property and divided the proceeds of sale equally. 

Property J

1. In February of 2004, the parties purchased an investment property at Property J.  This purchase was in conjunction with the wife’s sister and her partner.  In around October 2010 the parties sold Property J.  The parties, upon sale, each received approximately $30,000.00 from the net proceeds of sale of the Property J property. 

Property H3

1. The husband, in June of 2004, purchased this property in the sum of $105,000.00 through an entity, (omitted) Pty Ltd.  The Property H3 property has been funded through the husband’s business and the wife accepts that she has made no direct financial contributions to that property. 

Property H2

1. On 4 March 2008 the parties jointly purchased Property H2 for the sum of $159,000.00.  The current mortgage on Property H2 is $140,097.00.  The wife accepts that she did not make any contributions to the mortgage from around September 2008 to June 2010. 

2. It seems that, from around 2010 onwards, the mortgage payments almost equalled the repayments on the loan.  I note that the husband alleges, and it does not seem to be disputed, that he, between 2010 and 2011, made payments totalling approximately $8,499.00 in relation to the property. 

Property H1

1. The wife initially purchased vacant land at Property H1, for approximately $16,000.00 in around 2004.  Then it was listed on the property market in 2008 and the wife’s aunt purchased the property and built a house on it.  In 2009, the aunt died and the wife received an inheritance of that property from her aunt’s estate.  It is currently valued at $250,000.00.  The inheritance was received in early 2010. 

The Husband’s Business

1. The husband runs his business, (omitted) Pty Ltd.  The company is a corporate trustee for the superannuation fund he holds.  The company holds Property H3.  The husband established the Bolger Trust by a trust deed in 2008 and (omitted) Pty Ltd is the corporate trustee of that trust. 

The Valuation of the Husband’s Business

1. Mr J, an expert who was appointed to provide an alternative valuation to that of the Court-appointed expert, valued the husband’s business at $399,790.00, excluding any debit for capital gains tax.  The value, if capital gains tax implications were taken into account according to Mr J’s valuation, was $264,790.00.  The total realisation and taxation costs of (omitted) Pty Ltd are $134,774.00. 

1. The husband argued through his counsel, Mr Hamwood, that I should take into account costs of sale.  Mr Linklater-Steel, counsel for the wife, submitted that I should not, given that there is no immediate intention on the part of the husband to sell the business and/or the property that the business owns.  The valuation of Mr J, at paragraphs 102 and 103, said:

   “General

   [102] Proprietors of small businesses may be eligible for a 50% capital gains tax exemption on the disposal of active business assets were (sic) their net assets do not exceed five million dollars.  This exemption would be in addition to any exemption outlined above.

   [103] Proprietors of small business may also be eligible for a 100% capital gains tax exemption on the disposal of an active asset where that asset has been held continuously for fifteen years.” 

2. The law with respect to this is set out in a case of Rosati & Rosati (1998) FLC 92-804 at paragraph 6.36:

   “[6.36] It appears to us that although there is a degree of confusion, and possibly conflict, in the reported cases as to the proper approach to be adopted by a court in proceedings under s 79 of the Act in relation to the effect of potential capital gains tax, which would be payable upon the sale of an asset, the following general principles may be said to emerge from those cases:—

   (1) Whether the incidence of capital gains tax should be taken into account in valuing a particular asset varies according to the circumstances of the case, including the method of valuation applied to the particular asset, the likelihood or otherwise of that asset being realised in the foreseeable future, the circumstances of its acquisition and the evidence of the parties as to their intentions in relation to that asset.

   (2) If the Court orders the sale of an asset, or is satisfied that a sale of it is inevitable, or would probably occur in the near future, or if the asset is one which was acquired solely as an investment and with a view to its ultimate sale for profit, then, generally, allowance should be made for any capital gains tax payable upon such a sale in determining the value of that asset for the purpose of the proceedings.

   (3) If none of the circumstances referred to in (2) applies to a particular asset, but the Court is satisfied that there is a significant risk that the asset will have to be sold in the short to mid term, then the Court, whilst not making allowance for the capital gains tax payable on such a sale in determining the value of the asset, may take that risk into account as a relevant s 75(2) factor, the weight to be attributed to that factor varying according to the degree of the risk and the length of the period within which the sale may occur.

   (4) There may be special circumstances in a particular case which, despite the absence of any certainty or even likelihood of a sale of an asset in the foreseeable future, make it appropriate to take the incidence of capital gains tax into account in valuing that asset. In such a case, it may be appropriate to take the capital gains tax into account at its full rate, or at some discounted rate, having regard to the degree of risk of a sale occurring and/or the length of time which is likely to elapse before that occurs.”

3. In the present case the husband did not provide any evidence of the asset being realised in the foreseeable future.  The husband provided no evidence of when he intends to retire and his counsel submitted that I should take the capital gains tax and costs of realisation into account.  I also note there may be some exemptions available to the husband and he produced no evidence in relation to them.  However in circumstances where I have no evidence of the husband’s intention to retire and/or wind up the company, I am not satisfied that, on the principles set out in Rosati & Rosati (supra), that it is available to me to do that.  I will therefore put the value of the business in at $399,790.00. 

Dealing with the Property since Separation

1. At separation the wife received about $510,712.69, which was made up of her superannuation and a disability insurance payout.  The amount was deposited in the (omitted) Bank on 9 December 2010.  The wife set out in her affidavit the use of that sum, which was effectively to purchase a (business omitted) and the real property attached to that, and there are various withdrawals that basically seem to go to the running of the (business omitted).  She also purchased her motor vehicle.  The reality is that there is very significant amount of that fund that has gone into a bad business investment.  The husband did run a case of wasting, in the sense that the wife’s investment was reckless.  There was no suggestion that the funds were used for gambling.  The cases with respect to this area are well summarised in a decision of Justice Murphy, Kouper & Kouper (No. 3) [2009] FamCA 1080. His Honour summarised the relevant principles in relation to add backs at paragraphs 90-113:

   “(b) Relevant Principles and the Arguments in this Case

   [90] The decision whether to add back to the pool of assets, property disposed of or money spent, occurs against a legal framework where the general principle is that the Court takes the property of the parties or either of them as it finds it at the date of trial.

   [91] Financial losses incurred by the parties or either of them during the course of the marriage should generally be shared by them, although not necessarily equally (Kowaliw & Kowaliw (1981) FLC91-092 at 76,643-4 per Baker J).

   [92] Adding back to the pool is the exception, not the rule.  An exception can exist where one party has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets; or where one of the parties has acted recklessly, negligently, or wantonly, with matrimonial assets, the effect of which has reduced or minimised their value or the pool assets (as to which see Kowaliw above).

   [93] Baker J’s comments in Kowaliw are widely known. It is important to observe that his Honour also there said:

   If, on the other hand, losses of a financial kind have been suffered by the parties to a marriage in the course of the pursuit of matrimonial objects, such as the gaining of income or the acquisition of assets, whether the liability for such losses be joint or several, then, in my view, such losses should be shared by the parties (although not necessarily equally) and taken into account when altering property interests.

   [94] The Full Court has rejected the notion that add-backs only arise where “waste” can be established. The issue of “add-backs” is but part of the s 79 exercise, and, accordingly, it is governed by the principles of justice and equity:

   Although [the statement of Baker J just referred to] correctly crystallised the legal position so far as the case that his Honour was dealing with was concerned, it should not, in my view, be taken as meaning that in a case such as the present one, it is not appropriate to take the fact that a party has received funds into account, simply because they have been expended in a way which does not fit within the categories described by His Honour.

   In my view, what occurred in this case, as I said during the course of argument was, in fact, a premature distribution of a proportion of the matrimonial assets. What the husband did was to distribute to himself an asset in which the wife had a legitimate interest. In such circumstances, I consider that it would be unjust in the extreme, to simply treat such conduct by the husband as a matter to which regard should be had under s 75(2). It seems to me that the husband has had the benefit of that money. Had he retained, for example, the taxi-licence instead of selling it, that would have been brought into account as an item of property which would have been dealt with in the same way as the remaining items of property in this case. Accordingly, I am of the view that the correct way in which to deal with the husband’s receipt of those monies, is to bring them into the pool of assets on a notional basis, and make a distribution accordingly.

   Townsend and Townsend [1995] FLC 92-569 per Nicholson CJ at 81,654.

   [95] Specifically, the matters referred to by Baker J in Kowaliw have been held not to constitute any form of fixed code and are no more than a guideline for use in the exercise of the s 79 discretion.

   [96] In Browne v Green (1999) FLC 92-873 the Full Court considered an appeal in which a trial judge had held a husband solely responsible for losses from investment by the husband in a particular project, which investment was lost. In allowing the appeal, the Full Court held that it was manifestly unjust to the husband to attribute the losses solely to him on the basis that he had initiated the investment and had control over it.

   [97] The Full Court in Omacini & Omacini (2005) FLC 93-218 noted that circumstances in which it is appropriate to notionally add-back to the pool of assets, fall into “three clear categories”: where the parties have expended money on legal fees; where there has been a premature distribution of matrimonial assets; and in the circumstances outlined in Kowaliw referred to above.

   [98] That Full Court rejected the notion that “the mere fact that a party has expended money realised from the disposition of assets that existed as at the date of separation, will result in that expenditure being added back…” as being unduly simplistic (at para 39).

   [99] That add-backs are exceptional has also been emphasised in the Full Court in C v C ([1998] FamCA 143) where, (at para 46) the Full court held:

   Whilst not seeking to place a fetter upon the exercise of discretion of a trial judge in individual cases, it seems to us that the concept of adding monies reasonably disposed of back into the pool, ought to be the exception rather than the rule. The parties are entitled to reasonably conduct their affairs post-separation in a manner that is consistent with properly getting on with their lives.

   [100] Moreover, in my view, it needs to be borne in mind that the adding back of a specific sum is a mathematical or accounting exercise that seeks to attribute against one party, in this case in 2009 dollars, expenditure incurred in a different, earlier context and in dollars with an earlier value. Difficulties arise immediately upon the contemplation of such an exercise.

   [101] An example of the difficulties was provided in this case. The wife’s attention was drawn to a number of specific items contained in her calculations, and she was asked to specify how those items constituted “waste”. The wife conceded during the course of the exercise, that a number of those specific items did not, on reflection, come within the heading of “waste”.

   [102] I accept the contention of Counsel for the wife that this evidence should not be determinative of what, it was submitted, is a question of law (perhaps, more accurately, a mixed question of fact and law). However, the evidence does serve to illustrate the potential for injustice when a mathematical or accounting exercise is attempted in respect of dollars spent long-ago.

   [103] In the decision of the Full Court in Norbis v Norbis (1983) 9 FamLR 385 (unaffected in this respect, by the subsequent High Court Appeal), Strauss J held (at 395):

   The orders which have to be made must be such as will bring about a just and equitable adjustment of the parties’ rights in all their property, having regard to the fact that their marriage has been terminated. The task in hand is not akin, and cannot sensibly be akin, to the taking of partnership accounts, nor can it be a tracing exercise in the course of which such matters as contribution and capacity of a home-maker or parent for the duration of the marriage, or other matters in s 75 are traced into separate items the property in order to establish “interest” therein, which differ from the legal or equitable interests of the parties.

   [104] Although said in a different context, his Honour’s words, in my view serve to appropriately underscore that which has been emphasised by other Full Courts, namely that the entire s 79 exercise is not a mathematical or an accounting exercise.

   [105] In Browne & Green (1999) FLC92-873, the Full Court held, in re-exercising the discretion that:

   [76] … The somewhat difficult question arises as to the manner in which the extensive losses suffered by the husband in the [investment] should be treated. We have earlier concluded that there is no justification in this case for departing from the general principle in Kowaliw that losses (like gains) should be shared except in the circumstances referred to by Baker J in that decision, none of which had been found to exist in this case. If in a case where economic losses have been sustained during a marriage, the Court concludes that one party should be solely responsible for those losses, than the preferred course would be to make an adjustment in favour of the other party pursuant to paragraph 75(2)(o) (as seems to be suggested by Baker J in Kowaliw).

   [77] However, where, as in this case, the losses are to be shared, that outcome is simply achieved through the existence of a smaller pool of assets available for distribution (than there would otherwise have been) between the parties accordingly to the contributions of the parties under s 79(2) matters. It may then be necessary when the Court comes finally to assess the overall justice of the award which it processes to make to have regard to the proportions in which losses will be borne by the parties.

   [106] The expression “add backs” is, of course, convenient enough and is in wide use.  Indeed, it might be observed that, increasingly, (and despite the Full Court seeking to emphasise that they are the exception and not the rule) there seem to be few cases in which it is not said that “add backs” of some significance should form part of the divisible assets. 

   [107] In the case of paid legal fees, that might, on the authorities, be understandable enough, particularly where, for example, it is clear that paid legal fees have come from funds or property otherwise potentially divisible between the parties. Leaving aside paid legal fees, however, it seems to me that, consistent with the authorities just referred to, an approach which starts with a proposition that the property of the parties should include add backs runs the risk of, jurisprudentially, putting the cart before the horse:  add backs are the exception, not the rule.

   [108] Whilst, clearly enough, the authorities make it plain that the manner in which any dissipation of funds should be dealt with is a matter for the trial judge’s discretion, and accepting that the discretion ought not, of course, be fettered, it nevertheless seems to me that (leaving aside the issue of paid legal fees) the authorities indicate that the issue can, conveniently, be approached by reference to five questions:

   (a) Is it contended that property (including money), that would otherwise be available for distribution between the parties if a s 79 order is made, has been dissipated with a consequential loss to the property otherwise potentially divisible between the parties at the date of trial?;

   (b) If so, is it alleged that the dissipation of property was in respect of things other than what, in the particular circumstances of this particular marriage, can be classified as “reasonable living expenses”?;

   (c) If it is asserted that any loss to the divisible property results from dissipation of property other than in respect of such expenses, why is it asserted that the result should be a sharing of that loss by the parties other than equally?

   (d) If it is contended that this be the result, why should there be an add back (which brings to account, dollar for dollar, such past expenditure in current dollars) as distinct, for example, from there being an adjustment being made pursuant to s 75(2)(o)?; and

   (e) How should either any “add back”, or adjustment pursuant to s 75(2)(o), be quantified?

   [109] It will be seen that, excluded from that dissection, is a reference to any such losses being taken up in the assessment of contributions.   The concept of “negative contributions” has effectively been eschewed by an early Full Court (and, generally, by the court since):-

   In our view, there is no room for such a consideration in para (a), (b) or (c) of section 79(4). It would be relevant in this context for the Court to take into account that the burden of contribution of one party was increased because the other party failed to made (sic) such contribution as was reasonably expected of him or her…

   (Antmann and Antmann (1980) FLC 90-908 at 75,744)

   [110] Despite the reference to “contributions” in the passage just quoted, the same Full Court went on to say (ibid), “The fact that a party has committed “waste” of the matrimonial assets may be a relevant fact or circumstance under para. (o) of s 75(2) in an appropriate case”.   As has been seen, that statement finds reflection, nearly twenty years later, in the judgment of a different Full Court in Browne v Green.

   [111] Reference to those earlier authorities reveals that the answer to the third of the questions just outlined might be, “because the party’s expenditure was ‘reckless’ or ‘wanton’ or ‘negligent’ or ‘wasteful’”.  

   [112] Those categories are, of course, convenient descriptors of circumstances in which justice and equity might demand an “add back”, but the consistent theme of the authorities is to the effect that it is the subsequent question to which attention must be directed – by reference to the particular circumstances of the particular marriage - rather than an examination of whether particular conduct might be classified in one manner or another.

   [113] Put another way, the task is not to examine conduct for the purposes of fitting it within a particular description, or to reward the prudent and punish the imprudent.  Rather, the task is to examine and make findings about the particular circumstances surrounding expenditure and to determine, within that context, the manner in which overall justice and equity indicates the diminution in the pool ought be treated.”

2. In the present case, I am not satisfied on the evidence that I have before me, that the wife’s conduct in purchasing the (business omitted) at (omitted) and expending the monies that she has in keeping it afloat, was in any way “reckless”, “wanton”, “negligent” or “wasteful”.  The husband gave no evidence to support this conclusion.  As a consequence of that, I am not satisfied that I should deal with the diminution in her funds, that were provided to the wife after separation, other than to simply accept that they are not available in the pool for distribution. 

3. This is a case of a poor business investment.  If the investment had proved successful, the husband would correctly have argued it should be included in the pool. 

Principles in the Application

1. Pursuant to s.79 of the Act, the Court has the power to “alter the interests of the parties” in the property of the parties or either of them.

2. I must be firstly satisfied that it is just and equitable to alter the interests of the parties to the legal and equitable property held by them. 

3. I must be satisfied that any orders that I make are just and equitable pursuant to s.79(2) of the Act. In achieving just and equitable orders, I must take into account matters specified in s.79(4) and the general principles referred to in s.43 and s.81 insofar as they are applicable.

4. In the High Court decision of Stanford & Stanford (2012) FLC 93-518, the majority of the Court said:

   “The operation of s 79

   35. It will be recalled that s 79(2) provides that “[t]he 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”. Section 79(4) prescribes matters that must be taken into account in considering what order (if any) should be made under the section. The requirements of the two sub-sections are not to be conflated. In every case in which a property settlement order under s 79 is sought, it is necessary to satisfy the court that, in all the circumstances, it is just and equitable to make the order.

   36. The expression “just and equitable” is a qualitative description of a conclusion reached after examination of a range of potentially competing considerations. It does not admit of exhaustive definition. It is not possible to chart its metes and bounds. And while the power given by s 79 is not

   [86641]

   “to be exercised in accordance with fixed rules”, nevertheless, three fundamental propositions must not be obscured.

   37. First, it is necessary to begin consideration of whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property. So much follows from the text of s 79(1)(a) itself, which refers to “altering the interests of the parties to the marriage in the property” (emphasis added). The question posed by s 79(2) is thus whether, having regard to those existing interests, the court is satisfied that it is just and equitable to make a property settlement order.

   38. Second, although s 79 confers a broad power on a court exercising jurisdiction under the Act to make a property settlement order, it is not a power that is to be exercised according to an unguided judicial discretion. In Wirth v Wirth, Dixon CJ observed that a power to make such order with respect to property and costs “as [the judge] thinks fit”, in any question between husband and wife as to the title to or possession of property, is a power which “rests upon the law and not upon judicial discretion”. And as four members of this Court observed about proceedings for maintenance and property settlement orders in R v Watson; Ex parte Armstrong:

   “The judge called upon to decide proceedings of that kind is not entitled to do what has been described as ‘palm tree justice’. No doubt he is given a wide discretion, but he must exercise it in accordance with legal principles, including the principles which the Act itself lays down”.

   39. Because the power to make a property settlement order is not to be exercised in an unprincipled fashion, whether it is “just and equitable” to make the order is not to be answered by assuming that the parties’ rights to or interests in marital property are or should be different from those that then exist. All the more is that so when it is recognised that s 79 of the Act must be applied keeping in mind that “[c]ommunity of ownership arising from marriage has no place in the common law”. Questions between husband and wife about the ownership of property that may be then, or may have been in the past, enjoyed in common are to be “decided according to the same scheme of legal titles and equitable principles as govern the rights of any two persons who are not spouses”. The question presented by s 79 is whether those rights and interests should be altered.

   40. Third, whether making a property settlement order is “just and equitable” is not to be answered by beginning from the assumption that one or other party has the right to have the property of the parties divided between them or has the right to an interest in marital property which is fixed by reference to the various matters (including financial and other contributions) set out in s 79(4). The power to make a property settlement order must be exercised “in accordance with legal principles, including the principles which the Act itself lays down”. To conclude that making an order is “just and equitable” only because of and by reference to various matters in s 79(4), without a separate consideration of s 79(2), would be to conflate the statutory requirements and ignore the principles laid down by the Act.”

   (Footnotes omitted.)

1. The approach involves the following inter-related steps:

   a)Firstly, the Court must consider whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property;

   b)Secondly, the Court should evaluate the contributions of the parties within the meaning of s.79(4)(a), (b) and (c) and determine the contribution-based entitlements of the parties expressed as a percentage of the net value of the property of the parties;

   c)Thirdly, the Court should identify and assess the relevant matters referred to in s.79(4)(d), (e), (f) and (g) (the other factors) including, because of s.79(4)(e), the matters referred to in s.75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution-based entitlements of the parties established at Step 2; and

   d)Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case.

2. In matters where there are superannuation interest (particularly, those interest that are superannuation pensions), the majority of the Full Court in C & C (2005) FLC 93-220 (at paragraph 65) suggested that the preferable approach to superannuation interest was to treat it somewhat differently and separately from the non-superannuation assets and the Court said:

   “[65] … the trial Judge has a discretion as to how superannuation interests will be treated in a particular case. If superannuation is not included in the list of property but rather made the subject of a separate pool, it will be necessary where a splitting order is sought, or extremely prudent where no such splitting order is sought (in order to ensure that justice and equity is achieved) to:

   (a) value the superannuation interest (according to the Regulations if an order under Part VIIIB is sought or according to the Regulations or otherwise if no order is sought);

   (b) consider and make findings about the types of contributions referred to in s 79(4)(a), (b) and (c) which have been made by the parties to the superannuation interests on either a global approach or an asset by asset approach depending on the circumstances;

   (c) consider the other factors in s 79(4) being the matters in s 79(4)(d), (e), (f) and (g); and

   (d) ensure that pursuant to s 79(2) the orders in relation to the parties' property, and any order under Part VIIIB in relation to superannuation interests are just and equitable.”

3. The Court, however, also said:

   “[61] Nothing we have said in this judgment would prevent a Court in the exercise of its discretion from including a superannuation interest as an item of property in the list of property which is drawn as ``the first step'' in the determination of proceedings under s 79, whether or not a splitting order is sought in those proceedings. This approach could be adopted where the parties agree that it should be adopted, or where the Court is satisfied that the superannuation interest is indeed property within the meaning of the definition of property contained in s 4(1), or if the interest is not within that definition, but is of relatively small value in the context of the value of the other assets in the case, or there are features about the interest which leads the Court to conclude that this would be an appropriate approach.”

4. For the reasons I will advance, I intend to approach this matter by dealing with the superannuation interests and non-superannuation interest of the parties together.  The husband’s superannuation interest is the only superannuation in the pool.  It is a relatively small amount of the total pool.  I am satisfied it is appropriate to include it in the assets to be considered together rather than dealing with it separately.  This is how both counsel dealt with the superannuation in submissions.  Furthermore, neither party sought a splitting order in relation to the superannuation.

Is it Just & Equitable to make an Order?

1. Reference to the assets and liabilities set out herein demonstrates the parties have acquired the legal and/or equitable title to significant assets.  The parties have lived separately since April 2010.  They no longer use the home they had occupied during their relationship.  I am satisfied, given both parties seek the Court’s intervention and given that their mutual use of property has ended, that it is just and equitable to make orders altering the parties’ property interests. 

The Property of the Parties

ASSETS & LIABILITIES WITH AN AGREED VALUE
Assets	Ownership	Value
Property S (per valuation)	Husband	$375,000
Property H1, (per valuation)	Wife	$250,000
Property H2, (per valuation)	Joint	$180,000
Property T, (per valuation)	Wife	$190,000
2008 Range Rover motor vehicle (per valuation)	Wife	$54,000
Boat & trailer (per valuation)	Husband	$38,500
Individual cash accounts: -   (omitted) Bank a/c (omitted) at 4 March 2013: $18,387 -   (omitted) Bank a/c (omitted) at 26 February 2013: $15,508 -   (omitted) Bank a/c (omitted) at 26 February 2013: $32,980	Husband	$67,325
Individual cash accounts: -   (omitted) a/c (omitted) at 24 January 2013: $2,858 -   (omitted) a/c (omitted) at 31 January 2013: $24,201 -   (omitted) Bank a/c (omitted) at 5 September 2012: $1,764	Wife	$28,832
Furniture and Contents (in Husband’s possession at Property S)	Joint	$29,900
Furniture and Contents (in Wife’s possession at Property H)	Wife	$3,000
Total		$1,216,557
Liabilities
(omitted) Bank (a/c (omitted)) mortgage encumbering Property H at 4 March 2013	Joint	($140,097)
Total Non-superannuation Assets		$1,076,460
Superannuation	Ownership	Value
Accrued benefits held in self-managed superannuation fund “Bolger Superannuation Fund” at 31 December 2012	Husband	$219,631
Total Superannuation Assets		$219,631
TOTAL		$1,296,091

ASSETS & LIABILITIES IN DISPUTED
Assets	Ownership	Wife’s Value	Husband’s Value
Joint cash savings (at separation in safe)	Joint	E$25,000	NIL
(omitted) Pty Ltd ATF Headon Family Trust: -   (business omitted)  and (omitted) Pty Ltd: NIL -   (omitted) overdraft facility account ((omitted)) encumbering Property Tat 31 January 2013: (-$31,028.18) -   Trade Creditors at 1 March 2013 (Minimal) -   Trade Debtors at 1 March 2013 (Minimal) -   (omitted) business loan facility (a/c (omitted)) encumbering Property T at 1 February 2013 (-$152,913.00) -   Stock/Plant and equipment related to (omitted) Pty Ltd as trustee for Headon Family Trust: $10,500.00 (per valuation) -   (omitted) Credit Card (omitted) ((omitted) Pty Ltd) at 3 February 2013: (-$9,518)	Wife	-E$182,959	NIL
Husband’s business per Mr J’s valuation[1]	Husband	$399,790	$264,790
(omitted) Credit Card (omitted) (Ms Headon) at 22 January 2013	Wife	($2,027)	NIL
(omitted) Visa Card at 15 December 2012	Wife	($295)	NIL
Everyday Woolworths Card at 4 November 2012	Wife	($7,991)	NIL
(omitted) Visa Card a/c (omitted) at 4 March 2013	Husband	($3,863)	NIL
TOTAL DISPUTED ASSETS & LIABILITIES		$227,655	$264,790

[1] The difference between the husband’s value and the wife’s value is the realisation of costs of sale.

The Contested Items

Whether I Should Include the (omitted) Pty Ltd as Trustee for the Headon Family Trust Value

1. The asset is valued at -$182,959.00, and the substantial part of that liability is a loan facility encumbering Property T which was valued at $152,913.00 on 1 February 2013 and a further overdraft encumbering Property T in the sum of $31,028.18 as at 31 January 2013.  I am satisfied that it is appropriate to include this in the liabilities as it is a debt relating to property that is included in the pool and it would not be appropriate to include Property T as an agreed asset without including the encumbrances that are currently attached to that property.  I am therefore satisfied that it is appropriate to include that liability.  I also note that even though it is in the disputed liabilities table (exhibit 11).  Mr Hamwood, in his submissions at paragraph 8, said:

   “[8] As to the value of (omitted) Pty Ltd, the husband accepts that this enterprise currently has a value of -$182,959.”

The Husband’s Business

1. As already determined at paragraph 19, I am satisfied to include the husband’s business at $399,790.00. 

The Credit Cards of the Wife

1. The husband has not included his credit cards.  The credit cards as set out in the disputed liabilities are credit cards relating to post-separation expenditure.  Given that the husband’s credit cards have not been included, I am satisfied that it is appropriate to exclude the wife’s credit cards from the pool. 

Joint Cash & Savings in the Safe

1. The wife argued that the husband had $25,000.00 in the safe in his home.  The husband disputed that.  I am not able to make a finding that the cash was held in the safe on the evidence that the parties have provided.  There is no independent evidence to support either contention.  So I do not intend to include that sum. 

2. The assets of the parties then becomes as set out below.

THE ASSETS OF THE PARTIES
Assets	Ownership	Value
Property S (per valuation)	Husband	$375,000
Property H1 (per valuation)	Wife	$250,000
Property H2 (per valuation)	Joint	$180,000
Property T (per valuation)	Wife	$190,000
Range Rover motor vehicle (per valuation)	Wife	$54,000
Boat & trailer (per valuation)	Husband	$38,500
Individual cash accounts: -   (omitted) Bank a/c (omitted) at 4 March 2013: $18,387 -   (omitted) Bank a/c (omitted) at 26 February 2013: $15,508 -   (omitted) Bank a/c (omitted) at 26 February 2013: $32,980	Husband	$67,325
Individual cash accounts: -   (omitted) a/c (omitted) at 24 January 2013: $2,858 -   (omitted) a/c (omitted) at 31 January 2013: $24,201 -   (omitted) Bank a/c (omitted) at 5 September 2012: $1,764	Wife	$28,832
Furniture and Contents (in Husband’s possession at Property S)	Joint	$29,900
Furniture and Contents (in Wife’s possession at Property H)	Wife	$3,000
Husband’s business interests (per Mr J’s valuation)	Husband	$399,790
Total		$1,616,347
Liabilities
(omitted) Bank (a/c (omitted)) mortgage encumbering Property H, at 4 March 2013	Joint	($140,097)
(omitted) Pty Ltd	Wife	($182,959)
Total Net Assets		$1,293,291
Superannuation
Accrued benefits held in self-managed superannuation fund “Bolger Superannuation Fund” at 31 December 2012	Husband	$219,631
Total Superannuation Assets		$219,631
TOTAL NETT ASSETS INCLUDING SUPERANNUATION		$1,512,922

Contributions, Discussion & Conclusions

Initial Contributions

1. There is no dispute that the husband had the Property S property at Property S at the time the parties began living together.  The wife, on her own evidence, had virtually no property at the commencement of the relationship and she had a HECS debt of approximately $13,000.00.  The husband also had his (omitted) business.  The husband had some furniture and contents of the house, as well as a motor boat. 

2. It was not challenged that, at around the time the husband and wife got together, the husband had obtained a loan for approximately $80,000.00 in order to finance a payment to his previous wife, Ms C, as part of her property settlement. 

3. The husband had not been able to produce any evidence of whether he had any encumbrance on the Property S property, or not.  It is some time ago and it is difficult to expect parties to provide documentary evidence that goes back as far as that. 

4. I intend to rely upon the decision in Pierce v Pierce (1999) FLC 92-844, in particular, paragraph 28:

   “[28] In our opinion it is not so much a matter of erosion of contribution but a question of what weight is to be attached, in all the circumstances, to the initial contribution.  It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and the wife.  In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use made by the parties of that contribution.  In the present case that use was a substantial contribution to the purchase price of the matrimonial home. …”

5. In the present case, the husband had a property at Property S, whether it was fully unencumbered or encumbered to the value of $80,000.00 as suggested by the wife is not clear on the evidence.  The reality is that they still have that property and that property is now valued at $375,000.00.  The husband’s business interests, including the property contained in that valuation at Property H, is now worth $399,790.00.  The total current value of these two assets is $774,790.00.  This represents about 50% of the current asset pool. 

6. In those circumstances, in my view, the husband’s initial contributions need to be recognised as significant.  I am satisfied that it is appropriate to attribute 7% to the husband’s initial contributions given that those two assets, the real property and the business that the husband had at the commencement of the relationship, went a long way to seeding the wealth that these parties have accumulated.  In particular, the Property S property formed a basis upon which the parties could borrow to purchase other properties and the business has grown to a significant value over that time. 

7. Seven percent of the pool is approximately $150,900.00. 

Contributions during the Relationship & Post-separation

1. It is apparent from the evidence that the wife’s three children enjoyed the benefit of residing in the Property S property during the course of the relationship.  The wife and the husband contributed income during the time that they were in the relationship including when the wife was unable to work.  The wife was in receipt of disability insurance, being 75% of her salary.  The wife made non-financial contributions in that her evidence is that she did a lot of the work in the house, assisted by a cleaner and that the husband’s role with respect to that was to simply sweep out the floor early in the morning. 

2. I am satisfied that the husband provided slightly more in contributions during the relationship than the wife in the sense that the husband provided a home for the wife’s three children.  The husband also, during the relationship when the wife was not well, continued to pay for the outgoings in relation to the investment properties the parties had.  The husband made a significant post-separation contribution to his superannuation fund.  I am satisfied as a consequence of those factors that the husband should obtain a further 4% by way of contribution, totalling 11% by way of contributions on behalf of the husband. 

3. The wife brought a very significant asset into the pool quite late, in that she received an inheritance from her aunt at around separation and that property is valued at $250,000.00.  I am satisfied and I adopt the submissions of the counsel for the wife, in the written outline, that 7.5% is an appropriate figure for that. 

Additional Factors Including Consideration of the Relevant s.75(2) Factors

1. Having regard to the guidelines in In the marriage of Clauson & Clauson (1995) FLC 92-595, I must, in assessing any adjustments for the relevant s.75(2) factors, consider of the real impact in money terms and not operate “within artificially delineated boundaries”. 

2. In the present case the wife sought in her material, a 5% increase in her favour for future needs, having regard to the parties’ ages, with the husband being presently 58 and the wife presently 37.  The wife also submitted that I should take into account the disparity in their respective incomes.  The husband’s earning capacity, according to his expert, is significant compared with the wife’s.  The wife has not worked in paid employment since she was paid her disability insurance as a consequence of her disabilities that arose during the time that she was a (occupation omitted) with (employer omitted). 

3. The wife relied upon the evidence of Dr H, affirmed 19 March 2013 and filed on that day, who is a psychiatrist.  His report for (omitted) Super dated 11 August 2010, diagnosed Ms Headon as suffering from a major depressive disorder with moderate to severe symptoms.  The Doctor expressed an opinion based on his objective findings, that the wife was permanently unable to perform her full-time role as a (occupation omitted).  He went on to say that:

   “Her depressive and anxiety symptoms including regular panic attacks prevent her from returning to work.  Her symptoms are usually aggravated by anything (employment omitted)-related or her previous employment.  She is reluctant to go outside.  She has ongoing poor energy, poor motivation and extremely poor concentration and attention.  She relies on a lot of support from her family.”

4. Dr H expressed the opinion that:

   “…she is not capable of returning to any sort of gainful employment in the future.” 

5. In the present case the husband submitted that I should not rely upon Dr H’s evidence, partly because the doctor’s opinion:

   “[35] … is far beyond and not supported by any of the conclusions of fact he comes to.”

6. The husband was at liberty to, and entitled to, require an expert to challenge the opinion of Dr H.  Indeed, a joint Court expert psychiatrist could have been appointed on the application of either party.  I am satisfied that the evidence I have supports the conclusion that the wife is not going to be able to work in the future.  Certainly the wife has not done so to date.  Her attempt at obtaining gainful employment for herself by purchasing the business by way of the (business omitted) has proved to be not viable.  However I cannot make a finding that the wife is able to return to work on the basis of the efforts that she has put into the running of the (business omitted). 

7. So I do accept the evidence of Dr H as the only evidence that I have. It supports the conclusion that the wife will have difficulty obtaining employment. I note that the husband is still working and has a (omitted) business that, on any view of the evidence, has been successful over the years and will no doubt continue to be successful at least for the next five – seven years whilst the husband continues to run it. As a consequence of that, I am satisfied that an adjustment of 2.5% in favour of the wife is appropriate under s.75(2) and in the circumstances, that amounts to a sum of approximately $37,800.00 which is quite a small dollar amount when compared with the husband’s potential for income.

The Overall Conclusion – Just & Equitable Orders

1. The overall distribution of the asset pool will be 49% to the wife and 51% to the husband. 

2. With respect to the orders, the husband sought that the property at Property H2, that is jointly owned be transferred to the wife and that the mortgage transfer to her.  In the event that she is unable to do that, then the property be sold.  The wife sought that the property be transferred to her but that the husband take responsibility for the mortgage.  I am not satisfied, given the orders that I am going to make in this matter, that it is appropriate to burden the husband with that liability.  If in fact the wife is not able to maintain funding for that property, then the property should be sold.  So I am going to make an order to that effect. 

3. Neither party asked for a superannuation split.  Given the age of the husband, I am satisfied that it is appropriate to leave him with all of the superannuation and not make any split with respect to the superannuation. 

4. I am otherwise prepared to make the orders set out in the draft provided by the wife, which provides for the husband to pay to the wife a sum that is equal to, on my calculation, 49% of the pool by way of a cash adjustment, taking into account the asset pool that the wife currently holds.  I am satisfied that is an appropriate order.  If the husband fails to pay that, then it is appropriate to sell the Property S property which is a property that the husband holds which is unencumbered.

I certify that the preceding fifty-seven (57) paragraphs are a true copy of the reasons for judgment of Judge Cassidy

Date:  17 May 2013