Hoebeek and Hoebeek and Anor
[2017] FCWA 69
•30 MAY 2017
JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA
ACT: FAMILY LAW ACT 1975
LOCATION: PERTH
CITATION: HOEBEEK and HOEBEEK & ANOR [2017] FCWA 69
CORAM: MONCRIEFF J
HEARD: 1, 2 & 3 MAY 2017
DELIVERED : 30 MAY 2017
FILE NO/S: PTW 3049 of 2015
BETWEEN: MR HOEBEEK
Applicant
AND
MS HOEBEEK
First RespondentAND
COMPANY A
Second Respondent
Catchwords:
PROPERTY SETTLEMENT – Contributions – where the husband and wife have lived separately for 12 years – where the actions of the wife have significantly diminished the available pool of assets for distribution – where there is uncertainty as to the available pool of assets that will be realised – where sale of the real estate is ordered prior to the finalisation of the proceedings – proceedings adjourned pending ordered sales of real estate – turns on its own facts
SPOUSAL MAINTENANCE – Where the wife has followed various pursuits since the husband and wife have lived separately – where the wife provides no account of her dealings with significant funds – where it is not possible to make any assessment of the wife's needs or her ability to satisfy the threshold requirements for such an order – application dismissed
ADULT CHILD MAINTENANCE – Where there is little evidence and in particular no evidence separate from that of the wife of the children's financial, education or medical circumstances or considerations upon which the Court can rely such as to satisfy the threshold requirements for such an order – application dismissed
Legislation:
Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth)
Category: Not Reportable
Representation:
Counsel:
Applicant: Mr S O'Brien
First Respondent : Self Represented Litigant
Second Respondent : No appearance
Solicitors:
Applicant: Patrick Legal
First Respondent : Self Represented Litigant
Second Respondent : Not known
Case(s) referred to in judgment(s):
Stanford v Stanford (2012) 247 CLR 108
WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL JUDGMENT - PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN CHANGED
1The parties to these proceedings seek to enliven the jurisdiction of the Court to resolve financial matters between them arising as a consequence of the failure of their marriage relationship.
2The applicant, [Mr Hoebeek] (“the husband”) and the first respondent, [Ms Hoebeek] (“the wife”) were married [in] 1990.
3They have been separated for not less than seven years, however, there remains a dispute as to the date of their actual separation in the legal sense, although essentially they have lived physically separate lives since 2005.
4I refer to the parties as husband and wife without intending any disrespect to them, given that they are now divorced. I do so, however, to avoid any confusion that may arise by referring to the parties as applicant or respondent, particularly in these proceedings where there is a further respondent, namely a corporate entity, [Company A], a private company incorporated in [Country A].
5Company A is accepted by the wife as being her “alter ego”. She is the sole shareholder of the company, its public officer and authorised to speak on its behalf. Whilst the company has another director, it is accepted that as the company was incorporated in Country A, that a Country A director was required to satisfy the relevant local laws.
6The parties have two adult children; [N] born [in] 1993 (now 23 years of age) and [M] born [in] 1991 (now 26 years of age).
7Notwithstanding the fact that the parties have lived separately for an extended period of time, there has been a significant post separation transactional history between them.
8These proceedings were not commenced until 8 June 2015, at which time the husband sought to bring the ongoing financial relationship between the parties to an end. In addition, the husband filed an application for divorce on 12 June 2015.
9A divorce order was made by Magistrate Monaghan [in] 2015. The wife subsequently appealed the divorce order, although that appeal was ultimately dismissed. The wife continues to maintain that the parties “true separation date was the 15 May 2015”.
10In the course of the proceedings the wife has been represented by two firms of solicitors, although for the last 18 months or thereabouts she has been unrepresented. During this period, in order to assist the wife, the court has provided and directed the wife to materials designed to guide self-represented litigants through proceedings.
11The husband has been represented throughout and his solicitor, Mr O’Brien, appeared as counsel at the trial.
12I observe at the outset that this is a matter that has occupied a disproportionate amount of engagement with the legal process by the parties when the issues between them are relatively uncomplicated. Those issues have been over complicated however, and in particular by actions of the wife, to which I refer later in these reasons.
The applications
13The husband’s position at the commencement of proceedings and throughout has remained relatively straight forward. Initially he had sought a division of property as between he and the wife on a 45/55 basis in his favour, but more recently on an equal basis.
14The principal assets of the parties are a real estate holding in [Country B] and real estate holdings in suburban Perth.
15Additionally, the husband has significant superannuation entitlements by virtue of his employment as a senior employee with [Company B].
16It was accepted by both parties that firstly, the husband’s superannuation entitlement is managed pursuant to the provisions of the laws of Country B, and is accordingly beyond the jurisdiction of this Court as property. Secondly, and more significantly, it was accepted by both parties that by virtue of the laws of Country B there will be an automatic split of the husband’s superannuation entitlements as a consequence of the dissolution of the parties’ marriage. Accordingly the matter has proceeded largely on the basis that the superannuation entitlements of the husband are not only beyond the reach of the jurisdiction of the Court, but should be effectively disregarded given the operation of the relevant law of Country B.
17The wife’s position was far less clear. Initially she sought a distribution of the “net assets and superannuation of the parties be divided as to 85% to the wife and 15% to the husband”. She sought the transfer to her of some of the properties held by the parties on the basis that she refinanced the same to the extent that they were security for a mortgage loan pursuant to which the husband had a liability. Curiously, the response document filed by the wife initially sought no orders with respect to two other parcels of Australian real estate owned by the parties, presumably (although not explained) as the wife had effected a transfer of the subject properties to Company A with the intent that she would retain the same for her benefit, thus she did not see a need to include the same in her proposed orders. She had not, however, sought any specific orders releasing the husband from any guarantee that had been offered by him for borrowings associated with the acquisition of the relevant subject property. I note that the wife’s initial orders sought broadly included that she “do all acts and things and sign all documents necessary to … release and discharge the Husband from all or any liability under this mortgage”.
18Additionally, the wife had sought spousal maintenance, said to be expressed pursuant to s 77A of the Family Law Act 1975 (Cth) (“the Act”), in the sum of $4,500 per week until 6 July 2018, and thereafter $3,500 per week until Friday, 3 July 2020.
19The position for the husband at trial was clarified with the filing of a minute of orders in the following terms: (Unless otherwise specified, all errors and emphasis in extracts are as in original).
APPLICANT HUSBANDS FINAL MINUTE OF ORDERS SOUGHT
DATED: 3 MAY 2017
1.Within 30 days of the date of these Orders, the Husband and the Wife do all acts and sign all documents necessary to apply the net proceeds from the sale of [Property A] [and] [Property B] [in Suburb A], in the State of Western Australia, towards the three home loans held with Lloyds Bank (L01, L02 and L03) (“the Lloyds Bank loans”).
2.The Husband be appointed sole trustee for the sale of:
a.[Property C] [in Suburb A];
b.[Property D] [in Suburb A]; and
c.[Property E] [in Suburb A].
3.The Husband shall do all acts and sign all documents necessary to forthwith place the properties at [Property C], [Property D] and [Property E] on the market for sale.
4. That Landgate accept the signature of the Husband for the purposes of transferring the title of the [Suburb A] properties to the new purchasers.
5.In the event that the Court does not appoint the Husband as sole trustee for the sale of the [Suburb A] Properties, pursuant to paragraph 2 above, the 2nd Respondent Company, by its agents, servants and Directors, shall do all things necessary to forthwith place the [Suburb A] properties on the market for sale and shall otherwise comply with paragraphs 7 a)—c) and 8 a)-f) below in lieu of the Applicant. The 2nd Respondent shall liaise with the parties and keep the parties fully informed with respect to the sale of the [Suburb A] properties.
6.Within 7 days of being served a copy of this Order, the caveators of the [Suburb A] properties ([Mr N] and [Mrs N]), at their expense shall cause to be removed the caveats lodged over the [Suburb A] properties.
7.For the purposes of listing the property for sale pursuant to paragraphs 3 and 5 above, the Husband shall:
a)list the [Suburb A] properties for sale by private treaty with a real estate agent nominated by him.
b)Execute any and all other documents necessary to complete the sale of the [Suburb A] properties.
c)In the event that any or all of the [Suburb A] properties is/are not sold by private treaty within a period of 70 days, then the Husband may at his discretion list the [Suburb A] property or properties for sale by public auction with a real estate agent nominated by him. In doing so the Husband shall:
i)Ensure that the auction takes place within 45 days after the listing of the sale by public auction.
ii)Accept any offer at or above the said reserve price, and in so doing accept the advice of the auctioneer or his nominee as to the acceptance of a reasonable price lower than the said reserve price.
iii)Execute the contract of sale.
iv)Co-operate in every way with the said agents in relation to the sale of the [Suburb A] property or properties, including making keys available, allowing inspection of the property or properties at all reasonable times as requested by the agent and ensuring that the property or properties is/are in a neat and clean condition at the time of the inspection by prospective purchasers.
v)Execute any and all other documents to complete the sale of the [Suburb A] properties.
8.Upon settlement of the [Suburb A] properties the proceeds of sale be applied as follows:
a)in payment of agent’s fees, commissions and costs of sale;
b)in adjustment for all outstanding rates and taxes;
c)in discharge of all monies due and outstanding to Lloyds Bank secured by mortgage against the titles of the [Suburb A] properties;
d)in discharge of the loan due and outstanding to [Mr N and Mrs N], pursuant to the Deed of Loan agreement between them and the 1st Respondent Wife, with such amount to be characterized as a distribution to the wife of the matrimonial assets;
e)in discharge of the loan due and outstanding to [Mr Hoebeek Snr];
f)in discharge of the loan due and outstanding to [Mrs Hoebeek Snr];
g)in discharge of the loan due and outstanding to [Mr F] up to the amount of $50,000;
h)In payment of any capital gains tax payable from the sale of the [Suburb A] properties and the sale of [Property A] and [Property B]; and
i)The balance of the net proceeds of sale, if any, be divided so as to effect an overall distribution of the matrimonial assets, excluding pension and superannuation entitlements, of 50% to the Wife and 50% to the Husband, with the wife’s entitlement to be calculated so as to take into account her 50% liability for the amounts re-paid by the Husband for the loans to [Mr Hoebeek Snr], [Mrs Hoebeek Snr] and to [Mr F], in addition to the payment to [Mr N] and [Mrs N] upon settlement of the sale of the [Suburb A] properties.
9.There be a declaration that the loan to [Mr N and Mrs N] pursuant to the Deed of Agreement between the 1st Respondent and [Mr N and Mrs N] (including any interest, penalties or legal fees associated with such loan) and any other loans or monies advanced by [Mr N and Mrs N] to the 1st Respondent, is owed solely by the 1st Respondent , and that the 1st Respondent be responsible for the repayment of such monies or loans.
10.There be a declaration that the loans from [Mr Hoebeek Snr], [Mrs Hoebeek Snr] and [Mr F] (up to $50,000) were joint debts of the marriage.
11.The wife’s share of the matrimonial property pursuant to this Order be calculated to take into account her liability for the joint personal debts referred to in paragraph 10 above, and that the wife’s share of the matrimonial property be reduced by such amount to take into account any repayments the Husband has already made with respect to those personal debts.
12.There be a declaration that any outstanding utility accounts, including but not limited to the Water Corporation and Western Power pertaining to [Property C, Property D or Property E] are the sole debts of the Wife whether or not such accounts are in the name of the husband and the wife indemnify the husband and keep the Husband indemnified with respect to any such debts or any legal proceedings that may have been commenced in relation to those debts.
13.That any outstanding utility accounts pertaining to the [Suburb A] properties, be paid by the wife from her overall distribution pursuant to this Oder.
14. The Husband and the Wife close all joint accounts in their names and divide the funds so as to effect an overall distribution of the matrimonial assets, excluding pension and superannuation entitlements, of 50% to the Wife and 50% to the Husband.
15.Within 60 days of the date of these Orders, the Wife do all acts and sign all documents necessary to transfer all her right, title and interest in the [Country B Property] to the Husband.
16.Upon the transfer of the [Country B Property] to the Husband:
(a)The Husband and the Wife discharge the mortgage secured against the [Country B Property], and the Husband refinance the loan the into his sole name;
(b)The Husband pay to the Wife an amount for her interest in the [Country B Property] so as to effect an overall distribution of the matrimonial assets, excluding pension and superannuation entitlements, of 50% to the Wife and 50% to the Husband; and
(c)the Husband indemnify the Wife and keep the Wife indemnified with respect to the mortgage and all outgoings associated with the [Country B Property].
17.Except as otherwise provided for in this Order, the Husband and the Wife shall retain all other personal property in their possession or registered in their respective names, including motor vehicles, furniture and funds in any bank accounts in their names.
18.The Husband and the Wife do all acts and sign all documents necessary to give effect to the Wife’s entitlement to the Husband’s pension fund, according to [Country B] Law.
19.Except as otherwise provided for in this Order, the Wife shall be solely responsible for and indemnify the Husband and keep the Husband indemnified with respect to all debts and liabilities in her name, including but not limited to monies owed to [Mr N and Mrs N], [Company C], credit card debts in her name, personal loans in her name and taxation debts.
20.Except as otherwise provided for in this Order, the Wife shall be solely responsible with respect to all debts or liabilities in the name of any company of which she is a director/shareholder and shall indemnify the Husband and keep the Husband indemnified thereto.
21.Except as otherwise provided for in this Order, the Husband shall be solely responsible for and indemnify the Wife and keep the Wife indemnified, with respect to all liabilities in his name, including but not limited to credit card debts and taxation debts in his name.
22.The parties shall do all acts and sign all documents necessary to give effect to these Orders.
23.The parties shall do all things necessary to facilitate and co-operate with the sale of the [Suburb A] properties. The wife shall ensure that she makes keys available and allows inspections times as requested by the listing agents for the [Suburb A] properties and that the [Suburb A] properties are in a clean and presentable state at inspection times.
24.In the event that a party does not execute a document or instrument required to give effect to this Order, a Registrar of this Honourable Court is hereby appointed pursuant to section 106A of the Family Law Act 1975 to execute all documents or instruments in the name of the parties.
25.The Wife pay the Husband’s costs, including interim costs reserved.
20The minute as set out above, nominates the husband as sole trustee for the sale of the properties. At the commencement of the trial his position had been that the parties be appointed as joint trustees, however, the husband amended his position at the close of the hearing.
21The position for the wife at trial, however, was far from clear. In fairness to her, she believed that she had filed an amended response with her trial affidavit, however, the same was embodied in volumes of annexures to the said affidavit and had neither been either separately identified nor accepted for filing as a separate document. At the commencement of the trial the position was somewhat confused as to whether the husband had received notice of the wife’s proposed amendment, however, at my request the wife prepared a handwritten minute of the orders that she was seeking at trial, very much in accord with that that she had attempted to file.
22She sought the following orders:
1.MAKE PAYMENT OF OUTSTANDING MEDICAL BILLS FOR MY SON.
2.[MR HOEBEEK] PAY OUTSTANDING IINET PHONE BILL.
3.[MR HOEBEEK] PAY ADULT CHILD MAINTENANCE FOR 2. CHILDREN OF THE MARRIAGE $1.250 PER WEEK.
4.[MR HOEBEEK] PAY SPOUSAL MAINTENANCE OF $5.500 PER WEEK.
5.[MR HOEBEEK] PAY GBP 150,000 INTO ACCOUNT TO TO COMPLETE RENOVATIONS.
6.PROPERTIES BE TRANSFERRED TO A IRREVOCABLE TRUST.
7ALL LIFE INSURRANCES BE TRANSFERRED TO AN IRREVOCABLE TRUST.
8.[MR HOEBEEK] DELIVER UP.
1.NECKLACE (AS SHOWN IN THE PICTURES).
2.[M] & [N’S] BEDROOM/ FURNITURES.
3.ALL CRYSTALS BOUGHT AND LEFT INCLUDING THE ONES BOUGHT FOR THE OFFICE.
4.TWO EASY CHAIRS [COMPANY J] FURNITURE BOUGHT WHEN WE ARRIVED IN PERTH.
5.FEMALE CUPBOARD IN THE MASTER BEDROOM.
23In the amended response that the wife had incorporated with her trial affidavit, she had sought orders for herself and on behalf of Company A in the following terms:
1ST RESPONDENT FINAL MINUTE OF ORDERS SOUGHT
1That an irrevocable trust be established. The purpose of the trust is that nothing can be changed after court by none of the parties. The following assets are to be transferred to the trust:
a.[Country B Property];
b.My share of the pension, lump sum payment, in British pound or Euro, to be specified closer to date;
c.My share of the [Company B] share scheme, to be transferred in the form of [Company B] shares;
d.My share of the cash savings [Mr Hoebeek] hold, from his salary, which is to date undisclosed;
e.My share of the $4,500,000 Which also to date undisclosed;
sIf [Mr Hoebeek] refuses to disclose this amount of cash [Mr Hoebeek] must deposit $150,000 per year into the trust to cover the expenses and to allow the growth of the cash held in the trust upto $2,250,000.00 that will then generate the income needed to pay for the expenses as listed.
f.My life insurance and will;
g..[Mr Hoebeek’s] life insurance after increase to the original level insured which was $3,000,000.00;
h.[N’s] life insurance, with a will that will state should anything happens to [N], it will be investigated to great detail and extent and brought to the surface;
I.[M’s] life insurance, with a will or whatever legal requirements, that if anything should happen to [M] it will be investigated to great detail and brought to the surface
2Within 30 days of the date of these Orders, [Mr Hoebeek] do all acts and sign all documents necessary to remove his membership from [Superannuation Fund A], unless he wish to remain member. In the latter case all necessary legal documentation need to be signed listing all legal obligations and rights; I am not sure how that latter will work because for me it is finished no more contact is preferred
3[Mr Hoebeek] pay into a trust account $75,000 for ongoing medical expenses .that will be needed, to support [M’s] recovery further.
4[Mr Hoebeek] pay $75,000 into an account held in [N’s] name as a loan between [Mr Hoebeek] and his daughter. so she can start sorting the things that need to be sorted in [Country C]. During the time she is studying she will continue to repay into that account and withdraw when she needs to. [N] can then repay [Mr Hoebeek] once she has finished her university education and has proper job, that will allow her to do so.
2ND RESPONDENT FINAL MINUTE OF ORDERS SOUGHT
1Within 30 days of the date of these Orders, the Husband ('[Mr Hoebeek]") and the Wife ("[Ms Hoebeek]") do all acts and sign all documents necessary to transfer the net proceeds from the sale of [Property A] and [Property B], in the State of Western Australia, to a fixed interest bearing account, In the name of the charity fund to be created within 30 days of these orders by [Ms Hoebeek];
2[Mr Hoebeek] pay the total amount of $5.833.88 plus $ 5,497.3 totalling $11,331.18 into the charity fund's account.
3[Mr Hoebeek] and [Ms Hoebeek] and the 2 children of the Marriage [M] and [N] be appointed as trustees for the charity fund
4[Mr Hoebeek] and [Ms Hoebeek] shall do all acts and sign all documents necessary to forthwith reverse the sale [Property A] and [Property B] and effect the transfer of the properties onto the name of [Company A].
5[Mr Hoebeek] shall do all acts to provide the finances necessary to forthwith reverse the sale [Property A] and [Property B] and effect the transfer of the properties onto the name of [Company A].
6[Property A];
[Property B];
7After [Mr Hoebeek] has complied with the interim order as enumerated in point 3, of the interim orders sought, Within 60 days of the date of these orders [Ms Hoebeek] do all acts and sign all documents necessary to re-register [Company A] in Australia
8Within 70 days of the date of these orders the wife do all acts and sign all documents necessary to transfer half the shares of [Company A] in Australia, reflecting the ownership of [Property C] and [Property A and Property B] to the superannuation fund [Superannuation Fund A].
24As can be seen, the orders are internally inconsistent in that on the one hand the wife seeks that the net proceeds of sale of the subject properties be transferred to a “charity fund” and on the other she seeks to reverse the sale in favour of Company A, despite the fact that Company A was never the registered proprietor of the subject property.
25The wife had previously on an interim basis sought to restrain the sale of the subject properties Property A and Property B, but her application was dismissed by order of Magistrate Calverley of 30 July 2015, with a further order that the proceeds of sale of Property A and Property B be held in trust pending further order.
26His Honour’s orders were not appealed by the wife; the sales were completed in 2015 to an unrelated third party. The proceeds of sale remain held pursuant to his Honour’s order.
27I identified to the wife certain difficulties she may face with the orders that she was seeking, as to their terms, the ability of the Court to make the orders that she was seeking and as to the lack of particularity.
28In particular, I advised the wife at the outset of the trial that the laws of Country B were not applicable to these proceedings, which are governed by the Act. In her papers for the judicial officer filed 1 May 2017, she submitted that under “[Country B] law [Mr Hoebeek] is required to pay half his salary to me in spousal maintenance and pay half the bills … According to [Country B] I am entitled to 12 years spousal maintenance”. Despite putting the wife on notice, I make the observation that the final orders the wife sought seemingly continue to reflect the rights she believes she would be entitled to in the Country B.
29At the conclusion of the trial the position adopted by the wife can be summarised thus:
·that she seeks orders for the transfer of all real estate in which the husband has an interest, whether in Australia or Country B to her, together with further cash payment to her of GBP 150,000 (approximately AUD $258,000);
·ongoing spousal maintenance at the rate of $5,500 per week or $286,000 per annum;
·maintenance for the parties’ adult children at a combined rate of $130,000 per annum; and,
·continuing payments to the mortgage secured debts of $70,000 per annum.
The wife’s capacity
30Early in the trial I had some concerns about the wife’s capacity to conduct proceedings given the procedural history, the nature of the orders sought by her and the material contained in her affidavit ultimately filed as her trial affidavit. In answer to my questions the wife was clear in her understanding that I was being asked to make orders by the husband and that I had the jurisdiction to make such orders, that would affect the sale of the properties in Australia, and as against the parties, to effect a sale of the property in Country B or a transfer of that property to either the husband or the wife. Further, that she ran a risk that I may make such orders notwithstanding her application that effectively she retain the same.
31She was clear in her understanding that I was being asked to make such orders and that it was within the exercise of my jurisdiction to do so if I was satisfied that such orders were just and equitably made in the circumstances of the parties.
32I further advised the wife that in her application for spousal maintenance she had a threshold issue that she must satisfy and advised her of the terms of that threshold issue by direct reference to s 72 of the Act. She was also advised of the threshold issues with respect to the adult child maintenance applications, having regard specifically to the terms of s 66L of the Act. The wife indicated that she understood and I was satisfied from her presentation and the words spoken by her that she did understand.
33During the course of the trial it further became clear to me that the wife did understand the issues involved and was able to argue quite strenuously, and appropriately, her point of view on any issue that she wished to have understood. This was particularly evident in her arguments relating to variations in foreign exchange rates and her perception of benefit arising therefrom.
Background
34Each of the parties were born in Country B, the husband [in] 1963 and the wife [in] 1964. They were 53 and 52 years of age respectively at trial.
35The parties married [in] 1990. At the time of the marriage the husband was employed under the umbrella of Company B and has continued in that employment throughout the parties’ marriage. He continues to be so employed.
36In the context of the husband’s employment the husband and wife have resided in various locations.
37As seen there are two children of the marriage; N and M.
38Prior to their move to Australia, the husband and wife acquired the Country B Property, which is still held by them and remains as security for borrowings.
39In 2001 the family moved to Perth.
40In April 2002 the parties purchased Property C in Suburb A which was registered in the husband’s sole name.
41Problems started to emerge during the marriage and in 2005 the husband was relocated within the context of his employment to [Country D]. The wife remained in Perth with the children. The parties ceased residing together at this time, although their financial relationship continued, and the status of their marriage was, to say the least, uncertain.
42In 2006 Property A was purchased in Suburb A, again in the sole name of the husband.
43In 2007 the wife established Company A, of which she is the sole shareholder. In that year the parties also purchased a duplex at Property D and Property E in Suburb A, however, ultimately the wife transferred both Property C and Property D and Property E to Company A.
44In June 2007, the husband’s employment was relocated from Country D to [Country E].
45It was the husband’s case that the parties finally separated in December 2010. Thereafter the wife undertook training as a [salesperson] and established a business, through one of her various corporate entities, which are discussed in detail below.
46On or around 9 April 2012, without the husband’s knowledge or consent, the wife borrowed $330,000 from Mr N and Mrs N pursuant to a loan agreement.
47On 3 December 2012, Mr N and Mrs N lodged caveats over Property C and Property D and Property E. It was about this time that the husband became aware of the wife’s loan agreement with Mr N and Mrs N.
48In 2013 the property at Property C was demolished after the husband’s mother lent the parties €93,000 (AUD137,500) in order to fund the demolition and complete the sale. It was the husband’s case that the advance from his mother was taken at the instigation of the wife, however, the wife now denies that the same is a loan and asserts that it was an advance on the husband’s inheritance from his mother.
49Subsequently there was correspondence between the parties in which the wife represented to the husband that the only relevant mortgages were those encumbering Property A and Property D and Property E.
50In September 2013 the wife advised the husband that she had a purchaser for Property C, and the husband was led to believe that a sale of the property had been effected in October of that year. In fact it was not.
51In 2014 the parties agreed to subdivide Property A into two lots; Property A and Property B. The wife requested the husband borrow further funds to assist in the subdivision of the property, which he did from a friend, Mr F. The property was subsequently demolished and the land subdivided.
52In 2014 the parties’ child M developed significant mental health issues.
53The financial position of the parties was somewhat uncertain and the wife, who held a power of attorney for the husband, entered into transactions without his full knowledge or prior consent.
54The husband continued to fund the various borrowings undertaken by the parties, as he has done throughout their post-separation relationship, other than where funds were separately borrowed by the wife without his prior knowledge.
55In an endeavour to reduce the financial burden that he was meeting, the husband proposed that Property A and Property B be sold. The wife initially indicated that she was agreeable to the sale and would find a buyer, however, she did not do so. Ultimately the husband effected a sale of the property. Prior to the sale, however, the husband had borrowed €40,000 from his father to assist with the demolition, sub-division and sale of Property A and Property B, and, further, to meet his obligations. He also reduced the wife’s credit card debt by some $97,000.
56The husband additionally borrowed a further $26,000 from his friend Mr F in order to pay out a loan on [a Mercedes Benz] motor vehicle purchased in M’s name.
57In the context of the sale of Property A and Property B, the now subdivided property, the husband learnt that the wife had in fact not sold Property C, as had been represented to him, nor was it unencumbered.
58In May 2015 Property A and Property B were sold, however, on 21 April 2015, the wife had lodged caveats on the titles, and refused to remove the same. It was in this context that proceedings were commenced.
59In November 2015, the husband’s employment was relocated from Country E to [Country F] at the husband’s initiation to increase his income to meet a growing debt burden, which is discussed below.
History of the proceedings
60The matter first came before the Court on the application of the husband in June 2015. At that time the wife was represented by [Ms A] of [Law Firm A].
61Settlement on the sale of the property at Property B was due to be effected on 5 June 2015, however, the sale was delayed as a consequence of the caveats lodged on the properties by the wife. Settlement on Property A, was due on 8 June 2015, and was similarly delayed.
62Despite the caveats being “warned” and the relevant period having elapsed, the wife was able to re-caveat the property in advance of the settlement.
63On 11 June 2015, Magistrate Calverley ordered that the wife file answering documents and adjourned the proceedings to 8 July 2015.
64The wife had not complied with his Honour’s order to file documents at the adjourned date and was given a further six days grace.
65The matter was further adjourned.
66On 17 July 2015, upon the undertaking of the wife as to damages, the proceedings were again adjourned and the time for the wife to file her answering documents was once again extended. At this time the solicitors originally representing the wife had been replaced and the wife was represented by [Ms K] from [Law Firm B].
67The immediate sale aspects of the matter were ultimately heard by Magistrate Monaghan on 30 July 2015, when after hearing argument, his Honour ordered that the wife’s application to restrain the settlements be dismissed and further that the proceeds of sale be held in trust. At that time the wife was represented by counsel, [Mrs F].
68On 12 June 2015, the husband had filed an application for divorce. On the first return of the divorce on 20 August 2015, the same was adjourned pending a hearing for an application to dispense with service, the wife’s initial solicitors having ceased to act and service therefore not being effected through them and the wife’s subsequent solicitors having not yet filed a notice of address for service.
69The husband filed an application to dispense with personal service and orders were made on that application dispensing with personal service upon the wife of the divorce application. An order for costs was also made in favour of the husband, although its enforcement was stayed pending the finalisation of the financial proceedings between the parties.
70[In] 2015, a divorce order was made and, as seen, the same was subsequently appealed by the wife, which appeal was dismissed.
71Interim financial proceedings between the parties continued before the Court but were again adjourned on 14 January 2016, for further hearing.
72On 29 June 2016, Mr N and Mrs N had sought to intervene in the proceedings, as the husband was seeking orders for the sale of the remaining Suburb A properties. This application was supported by the proposed interveners, provided their loan advanced to the wife, which was secured by caveats registered over the properties, was satisfied. The wife opposed the sale of the properties.
73On 4 May 2016, the matter, having been set for interim argument, was again adjourned with the following orders being made by Magistrate Calverley:
1Within 21 days from the date hereof, the Respondent, [MS HOEBEEK], file and serve a Minute setting out the interim orders sought by her.
2Within 21 days from the date hereof, the Respondent file and serve a schedule of the annexures that she intends to specifically rely on as attached to her affidavit of 24 February 2016.
3The Proposed Interveners [MR N] and [MRS N] have leave to file an application to Intervene in the proceedings.
4The proceedings be adjourned for interim hearing on 5 July 2016 at 11am with an estimated hearing time of 1 – 2 hours.
5The costs of the Applicant, [MR HOEBEEK], be reserved.
6The proceedings otherwise be transferred to the Family Court of Western Australia.
74By this time the wife had ceased to be represented.
75On 20 May 2016, the parties attended a conciliation conference, however no agreement was reached. Procedural orders were made referring the matter to a readiness hearing and the following schedule for the filing of affidavits in preparation for trial was ordered:
…
5By no later than 42 days prior to the date fixed for the Readiness Hearing, the Applicant shall file and serve the Respondent with:
(a)an affidavit setting out the party’s evidence;
(b)an affidavit of each witness;
(c)a list of the names of any proposed witness who has refused to provide and affidavit;
(d)an up-to-date Form 13 financial statement; and
(e)a Minute of Proposed Orders sought setting out with particularity the orders sought by him at trial.
6By no later than 14 days prior to the date fixed for the Readiness Hearing, the Respondent shall file and serve the Applicant with:
(a)an affidavit setting out the party’s evidence;
(b)an affidavit of each witness;
(c)a list of the names of any proposed witness who has refused to provide and affidavit;
(d)an up-to-date Form 13 financial statement; and
(e)a Minute of Proposed Orders sought setting out with particularity the orders sought by her at trial.
7If a party fails to file these documents on time, the other party may apply to a Judge or Magistrate for leave to proceed as if the case was not being defended or for other appropriate orders. The party in default (and their lawyer if represented) shall attend the hearing before the Judge or Magistrate.
8If there is a dispute involving expert evidence, the experts shall confer by no later than 14 days before the Readiness Hearing. Each party must provide to any expert they have instructed a copy of the document entitled “Experts’ Conferences – Guidelines for expert witnesses and those instructing them in the Family Court Of Western Australia”. The experts shall prepare and provide to the parties a joint statement setting out the issues that are agreed and not agreed, identifying the reasons for disagreement on any issue and identifying what action (if any) may be taken to resolve any outstanding issues. The report may be tendered to the Court as evidence of matters agreed upon and to identify the issues on which evidence will be called.
…
10No later than 7 days prior to the Readiness Hearing the parties file a joint schedule of assets, liabilities and resources, such schedule to identify where the parties agree or disagree. If the parties cannot file a joint schedule, then they each file a schedule of the parties’ assets, liabilities and resources.
…
16Within 60 days, the Applicant and the Respondent provide to the other party an up to date list of disclosure.
76The proceedings were before the Court again on 5 July 2016, at which time argument did not progress.
77At the further adjourned hearing before Magistrate Calverley on 1 August 2016 there were now two proposed interveners, Mr N and Mrs N and Company C. The applications were opposed by the wife. At that hearing, however, the proposed interveners did not pursue their application, observing that they “no longer want to be involved in what now they see more than ever as being protracted proceedings between the parties”.
78In the context of the proceedings the husband had also sought to join Company A as a party. The issue of the joinder of the third party company was adjourned to 5 September 2016, in light of the wife’s uncertainty as to whether or not she would agree to the joinder of the company. At that time, after argument, Magistrate Calverley ordered as follows:
1Within 7 days from the date hereof, the First Respondent, [MS HOEBEEK], provide to the Applicant, [MR HOEBEEK], and the Court the current registered office of the company [Company A].
2[COMPANY A] be joined as a party to the proceedings and henceforth be known as the Second Respondent.
3Until further order, the Second Respondent’s address for service in Australia be the First Respondent’s address but all documents that are required to be served on the Second Respondent must also be sent to the company’s registered office in [Country A].
4Within 28 days from the date hereof, the Second Respondent file and serve:
(a)a Form 1A response;
(b)a Form 13 Financial Statement ;
(c)an Affidavit;
(d)a Form 2A response; and
(e)an affidavit in support of any interim orders sought.
5The parties attend a Readiness Hearing on 15 November 2016 at 12 noon. (A copy of the Readiness Hearing Information Sheet is attached)
6The interim proceedings be adjourned to 30 November 2016 at 12 noon with an estimated hearing time of 1 hour.
7Within 35 days from the date hereof, the parties provide updated disclosure by list.
8Both parties’ costs be reserved.
9The proceedings otherwise be transferred to the Family Court of Western Australia.
79A readiness hearing was convened by Registrar Kuurstra on 15 November 2016.
80The matter was further before Magistrate Calverley on the application of the husband on 30 November 2016.
81Magistrate Calverley ordered as follows:
1Within 14 days from the date hereof, the First Respondent, [MS HOEBEEK], comply with paragraph 6 of the orders of 20 May 2016.
2In the event the First Respondent fails to comply with preceding order, then subject to further order of the Court, the Applicant, [MR HOEBEEK], have leave to proceed with his application on an undefended basis.
3Within 14 days from the date hereof, the parties file and serve an updated disclosure list.
4Within 14 days from the date hereof, the Second Respondent, [COMPANY A], comply with paragraph 4 of the orders of 5 September 2016.
5In the event a written request to relist the parties’ outstanding interim applications is not received from either party by close of Registry on 20 January 2017, then the Client Administration Officer shall refer the matter to the Presiding Magistrate in Chambers for orders to be made without further notice to the parties as follows:
(a)all outstanding interim applications otherwise be and are hereby dismissed.
6[Mr G] be appointed as Single Expert Witness to prepare a report as to the value of [Property C], [Property D] and [Property E], in the State of Western Australia (“the properties”).
7Until further order of the Court, the Applicant pay the Single Expert Witness’ costs with liberty to the Applicant to seek a contribution to such costs from the Respondent at trial.
8The Respondent do all such things as are necessary to facilitate the preparation of the Single Expert Witness report, by making the properties available for inspection.
9The Form 2 applications filed 25 October 2016 and 29 November 2016, otherwise be and are hereby dismissed.
10The outstanding interim applications of the parties stand adjourned generally.
11The Applicant’s costs be reserved.
12The proceedings otherwise be transferred to the Family Court of Western Australia.
82The time in which the wife and Company A had to comply with his Honour’s orders expired on 14 December 2016.
83The wife ultimately filed her trial affidavit on 15 December 2016, however, despite the wife’s late filing, the husband did not seek to proceed on an undefended basis.
84Throughout the interim proceedings and continuing at trial, the wife has resisted the sale of the remaining Suburb A properties. The parties have been subjected to applications for leave to intervene, which were subsequently discontinued for the reasons as represented to Magistrate Calverley, and the wife resisted the joinder of Company A, despite the same being the registered proprietor of the remaining Suburb A properties, each of which was subject to mortgage securing advances under the terms of which the husband was also a guarantor.
The composition of evidence
85The husband sought to rely on his affidavit and statement of financial circumstances both sworn on 30 September 2016.
86Additionally he sought to rely on notices to admit facts filed 14 September 2016, and 24 March 2017. In each case notice was also given to the wife to admit the authenticity of the attached document.
87The wife relied upon her trial affidavit filed 15 December 2016, both on her behalf and on behalf of Company A, together with a statement of financial circumstances affirmed by her on 14 December 2016, that was not separately filed and was contained in her trial affidavit.
88The wife’s trial affidavit had numerous annexures numbering some nearly 700 pages, including prior affidavits filed by her, various messages and correspondence, numerous photographs, particularly of the husband and any company he was keeping and her commentary thereon. The same appeared somewhat random in its selection, and the affidavit, like the annexures, did not follow a logical informative sequence, but was rather directed to argument, both material and spiritual.
89As discussed above, the wife had also sought to file what purported to be a further response, however, the same was caught up with the documents filed with her affidavit and not separately filed. Although no leave had been sought to file the further response, the same was overtaken and simplified by the handwritten minute of orders tendered by the wife to which I have referred.
90As seen, I have set out both above.
91The husband also relied on valuation evidence prepared by Mr G, a Single Expert appointed pursuant to the Family Law Rules 2004 (Cth) as annexed to his affidavit sworn 18 April 2017. Mr G had valued Property C and Property D and Property E, and his values were agreed by the parties.
92Similarly, during the course of the trial a valuation of the Country B Property was received, and although the same was in Country B language, the valuation figure was agreed between the parties.
93In their respective cases only the husband and the wife gave evidence, and the wife’s evidence was also that of Company A.
94The husband was cross-examined by the wife and the wife cross-examined by Mr O’Brien.
95The husband was an impressive witness. He was precise and attempted to answer questions, in my assessment, as fully and frankly as he could and was a significantly more reliable historian than the wife. The husband was prepared to make appropriate concessions against his interests and was prepared to accept, without hesitation, corrections to his evidence where appropriate.
96The wife was unimpressive as a witness. Her evidence was both confused and confusing, had little structure or logic in its presentation and as seen, I was concerned about her capacity at the commencement of the trial. My concerns regarding her capacity to represent herself were not sustained during the course of the trial, albeit that the wife’s presentation of her evidence could best be described as chaotic. One of the features of the wife’s presentation as a witness was that rather than accept a proposition put to her of a relatively straight forward fact, that was easily capable of acceptance or denial, she would choose to argue, or seek to excuse herself from doing so by virtue of some generally irrelevant fact or circumstance.
97The factual matrix of this matter was relatively straight forward, however, the wife’s conduct as a witness ultimately made the task of assessing what should have been straight forward matters more difficult.
98My concerns regarding the wife’s credibility were not strengthened by her open admission that she would lie “to keep [the husband] quiet”, nor by her manifest refusal to reality test not only her claims, but some of her financial theories, which appeared to lay the foundation for a somewhat extraordinary range of decisions taken by the wife and said to have advanced the family fortunes.
The approach to be adopted
99In Stanford v Stanford (2012) 247 CLR 108, the High Court of Australia mandated that prior to exercising jurisdiction pursuant to s 79 of the Act to vary property interests, the Court must be first satisfied that it is just and equitable to make an order to do so as a precursor to determining, by reference to the matters prescribed in s 79, what order for variation of property would in the circumstances of the parties produce a just and equitable outcome.
100In the consideration of this initial step the Court is directed to firstly identify the property held by the parties and the legal and beneficial interests in such property.
101It is a credit to the parties that the value of property held and the quantum of liabilities was able to be agreed for the most part. Some disputes remained, although they were limited and principally related to whether or not certain liabilities should be taken into account as against the parties by being found to be loans or who should bear responsibility for debt without calling upon the other to contribute thereto.
102A schedule of the parties’ assets and liabilities was tendered, however, as the items in dispute were few and I deal with those items below, I set out the final assets and liabilities as I have found them to be, in the following terms and utilising the same format and item numbers as in the tendered schedule:
All Values shown in Australia Dollars ($)
| Item | Particulars | Value | Ownership/Posession | ||
| Wife | Husband | Other | |||
| Assets | |||||
| Joint Assets | |||||
| 1 | [Country B Property] | $690,000 | $345,000 | $345,000 | |
| 2 | Westpac Choice Account [XXXXX X] | $30,662 | $15,331 | $15,331 | |
| 3 | Commonwealth Bank [XXXXX XXXXX XXXX] | $0 | $0 | $0 | |
| 4 | [Bank A] [XXXXX XXXXX XXXXX XXX] | $0 | $0 | ||
| Husbands Assets | |||||
| 5 | [Bank A] [XXXXX XXXXX XXXXX XXXX] | $18,254 | $18,254 | ||
| 6 | Commonwealth Bank Account [XXXXX XXXXX XXXX] | $310 | $310 | ||
| 7 | HSBC [Country E] [A] account [XXXXX XXXXX XX] | $57 | $57 | ||
| 8 | HSBC [Country E] [B] account [XXXXX XXXXX XX] | $5 | $5 | ||
| 9 | [Bank B] [XXXXX XXXXX X | $32 | $32 | ||
| 10 | Westpac Choice Account [XXXXX XXXXX XX- | $0 | $0 | $0 | |
| 11 | Standard Chartered Account [Country F] [XXXXX XXXXX ] | $3,952 | $3,952 | ||
| 12 | [Ford Falcon] motor vehicle in [Country F] | $20,316 | $20,316 | ||
| 13 | [Company B] Share Plan - performance shares | unknown | unknown | ||
| 14 | Furniture and chattels | $15,000 | $15,000 | ||
| Wife's Assets | |||||
| 15 | Westpac Account ending [XXXX] | $184 | $184 | ||
| 16 | NAB account ending [XXXX] | - | - | ||
| 17 | NAB account ending [XXXX] | - | - | ||
| 18 | NAB account ending [XXXX] | - | - | ||
| 19 | NAB account ending [XXXX] | -$1 | -$1 | ||
| 20 | NAB account ending [XXXX] | -$68 | -$68 | ||
| 21 | NAB account ending [XXXX] | $1.70 | $1.70 | ||
| 22 | NAB account ending [XXXX] | - | - | ||
| 23 | HSBC Account [XXXXX XXXXX ] | $4,426 | $4,426 | ||
| 24 | HSBC Account [XXXXX XXXX] | - | |||
| 25 | [Mercedes Benz] Motor Vehicle | $8,000 | $8,000 | ||
| 26 | [Ford Falcon] motor vehicle | - | - | ||
| 27 | Jewellery | $5,000 | $5,000 | ||
| 28 | Furniture and chattels – wife | $15,000 | $15,000 | ||
| [Company A] | |||||
| 29 | [Property D] | $450,000 | $450,000 | ||
| 30 | [Property E] | $440,000 | $440,000 | ||
| 31 | [Property C] | $690,000 | $690,000 | ||
| [Company E] | |||||
| 32 | Westpac Business Account ending [XXXX] | $1,000 | $1,000 | ||
| [Company D] | |||||
| 33 | ANZ business account | -$10,417 | -$10,417 | ||
| 34 | Westpac Business Account ending [XXXX] | -$660 | -$660 | ||
| [Company E] | |||||
| 35 | [Company E] - business account | unknown | unknown | ||
| Total Assets: | $2,377,349 (rounded) | ||||
| Superannuation | |||||
| 36 | CBA Business Transaction Account ending [XXXX] | $30 | $30 | ||
| 37 | [Superannuation Fund A] | Unknown | Unknown | ||
| Total Superannuation | $30 | $30 | $0 | $0 | |
| Total Assets incl. Superannuation | $2,377,380 (rounded) | ||||
| Item | Particulars | Amount | Person Liable | ||
| Wife | Husband | Other | |||
| Liabilities | |||||
| Joint Debts | |||||
| 1 | [Bank A] Mortgage (1) [Country B Property] [XXXXX XXXXX XXXXX XXX] | $315,000 | $157,500 | $157,500 | |
| 2 | [Bank A] Mortgage (2) [Country B Property][XXXXX XXXXX ] | $41,448 | $20,724 | $20,724 | |
| 3 | CBA credit card debt | - | - | - | |
| Husbands Debts | |||||
| 4 | Capital Gains Tax owing on sale [Property A and Property B] | tba | |||
| 5 | Commonwealth Credit Card | - | |||
| 6 | Coles Platinum Mastercard [XXXXX XXXXX XX] | $12,653 | $12,653 | ||
| 7 | [Mrs Hoebeek Snr] (mother) | $105,000 | $105,000 | ||
| 8 | [Mr Hoebeek Snr] (father) | - | |||
| 9 | [Mr F] (friend) | - | |||
| [Company A] | |||||
| 10 | Mortgage [Property D] | $364,112 | $364,112 | ||
| 11 | Mortgage [Property E] | $318,026 | $318,026 | ||
| 12 | Mortgage [Property C] | $618,369 | $618,369 | ||
| 13 | WaterCorporation Overdue account - July 2015: [Property D] | $2,138 | $2,138 | ||
| 14 | WaterCorporation Overdue account - July 2015: [Property E] | $3,996 | $3,996 | ||
| Wife's Debts | |||||
| 15 | David Jones American Express card | $5,527 | $5,527 | ||
| 16 | Woolworths Visa Credit Card | ||||
| 17 | HSBC Platinum Credit Card account | $6,327 | $6,327 | ||
| 18 | Citibank Platinum Credit Card account | $7,292 | $7,292 | ||
| 19 | [Mr N] and [Mrs N] Loan | $130,590 | $130,590 | ||
| 20 | Estimated Tax Liability | $7,500 | $7,500 | ||
| 21 | Pack and Send storage | $19,243 | $19,243 | ||
| Total Liabilities | $1,968,367 | ||||
| Total Nett Assets | $408,982 | ||||
| Financial Resources | |||||
| [Company B] Pension Fund | $1,388,804 | $694,402 | $694,402 | ||
| NET ASSETS INC SUPERANNUATION ONLY | $408,962 | ||||
| NET ASSETS INC. SUPERANNUATION & FINANCIAL RESOURCES | |||||
103As can be seen, assets are held by the parties jointly, separately and through corporate entities created by the wife, including Company A.
104Both the husband and the wife and the wife in her capacity as the controller of Company A seek to enliven the jurisdiction of the Court to vary property interests; the husband through a transfer of the wife’s interest in the Country B Property to him and the sale of the remaining property in Suburb A; the wife through a transfer of all property to a third party, presumably one of her companies as trustee for the wife’s unspecified trust, or otherwise for her to retain the same for her use and benefit absolutely whether in her own name or through the corporate entity Company A.
105Any presumptions as to the use, enjoyment or benefit of property held by the parties during the course of their relationship have now ceased. As the High Court of Australia observed in Stanford v Stanford (supra), that of itself may be sufficient to enliven the jurisdiction of the Court and to render the making of an order just and equitable.
106Absent any agreement between the parties it is necessary to enliven the jurisdiction of the Court to determine their respective applications. As the outcome advanced by either party requires a variation of existing property interests, I am satisfied that it is just and equitable to make an order and, further, I observe that without making an order the Court could not effectively bring to a conclusion the financial relationship of the parties, as is its obligation to the extent that it is practicable, pursuant to s 81 of the Act.
The items in dispute
107The parties were largely in agreement about the values to be ascribed to the various assets and liabilities.
108The dispute as to value was limited to the husband’s estimate of his furnishings and chattels (line 14). I accept that he gave an estimate in good faith, as he did of the wife’s chattels about which his estimate was not challenged. Logic would dictate that if his estimate of one grouping of chattels was not disputed and the other not challenged, then the same should be accepted, as I do.
109The second class of areas where there was a disagreement about the assets and liabilities schedule relates to bank account balances held or operated by the wife or a corporate entity that she controls. The difficulty arises as a consequence of the wife’s failure to disclose documents in accordance with her obligations, and in many instances she was “unsure” or could only provide approximations of the relevant bank account balances.
110Given that the husband’s overall assessment of the accounts operated by the wife was negative, and the uncertainty indicated by the wife on the assets and liabilities schedule relates to minor amounts, I propose to rely on the figures proffered by the husband, particularly as it was in the wife’s remit to provide account figures in accordance with her obligation to do so.
111On the husband’s case, one liability, however, was unknown and that is the husband’s liability to pay capital gains tax on the sale of Property A and Property B. The husband was unable to quantify the liability in the absence of documentation as to historical costs being provided by the wife. I note, however, a further uncertainty will arise in any event, though not in evidence before me, as it is unclear as to what the husband’s residential status is for the purposes of taxation and the impact that may have upon the liability. In any event, having regard to the relevant figures to which I refer below, I conclude that the worst case for the husband in terms of a tax liability, and on the assumption of an assessment at the highest marginal rate, is that it is unlikely to exceed $61,250, calculated thus:
Sale price (combined figures of [Property A] and [Property B] $925,000, less purchase price of $675,000, equals gross gain of $250,000, divided by two (as [Property A] and [Property B] [were] held for greater than a year), multiplied by .49 (representing the highest marginal tax rate plus Medicare levy), and without allowing for any allowances or relevant capital costs, for example stamp duty and subdivision costs.
112The other disputed items relate to the transactions entered into between the husband and his parents. Although there was no longer a remaining liability to his father, the same having been repaid to him, the wife disputed that it was a loan. In contrast she did not dispute that the husband borrowed money from the husband’s friend, Mr F, to assist him financially in circumstances to which I refer below. She disputed that there is any balance due to the husband’s mother, despite being called upon to admit the same by notice to admit fact filed 14 September 2016 and admit the relevant document where no notice of dispute was filed, and where the husband’s evidence was effectively unchallenged.
113Further, the wife’s email of September 2013 (detailed below) and the husband’s performance of the loan agreement, in the sense of the repayment he has made to date by reducing his indebtedness to his mother by €18,000, are consistent with his representation of the same as an agreement. On balance I find that the same is a debt due.
114Overall, I therefore conclude that the assets and liabilities schedule is as I have set out above. I do not include in the final assessment thereof the Company B pension fund, to which I have referred earlier in these reasons, given the wife’s separate entitlements pursuant to the terms of that fund as agreed.
115That is not to say, however, that I disregard the fact that it is likely that the husband’s superannuation benefit will increase with his continuing employment with Company B, but rather the same is to be treated as a financial resource in my consideration of the factors prescribed in s 75(2) of the Act.
Contributions
116Of the property held by the parties only one item of real estate appears not to have attracted any controversy, namely the Country B Property, which remains subject to the liability as specified in the schedule above. The same is jointly held and the husband sought to retain the same as his sole property, with the appropriate adjustment to the wife with respect to the parties’ equity therein.
117The wife sought that the Country B Property be transferred into her proposed trust, although in her closing submissions and in answer to questions from me, it became clear that however the property is held she wished to retain it, whilst offering no reason in support of her position, other than it being of assistance in her overall plans for wealth creation.
118In contrast, the husband faces the real possibility of being transferred to Country B in his employment.
119It is the wife’s generally vague and uncertain plan or plans for wealth creation, as she sees it, that caused the greatest controversy in the proceedings between the parties. As discussed below, the net effect to date of the wife’s plans in this regard has been to substantially increase the parties’ debt.
120On the one hand, the husband’s contribution to the asset position of the parties is easily defined and flows from his not insignificant earnings. The wife’s financial contribution, on the other hand, has been shrouded in complexity and in my finding a lack of understanding or reality testing.
121There is no doubt however, that the wife’s contribution in her capacity as primary caregiver, and indeed since 2005 she has effectively been the sole carer for the parties’ children, has been significant.
122The wife was entrusted to administer the parties’ financial affairs in the husband’s absence and the husband executed a power of attorney in her favour that enabled her to do so. His trust was misplaced and it is beyond doubt that at times the wife actively misrepresented transactions to the husband and the necessity for funds, for example the wife claimed that she needed $26,000 from the husband to discharge a loan on the Mercedes Benz motor vehicle.
123The husband secured the funds by borrowings from a friend, Mr F. The funds were transferred to the wife who then paid out the balance of the Mercedes Benz loan. The only evidence placed before the Court would suggest that the amount due was in fact less than $20,000. She was not able to account for the other $6,000. The husband has since discharged the debt to Mr F.
124The most significant misrepresentation by the wife, however, was that Property C was sold when in fact it was not. The husband, relying on representations made to him by the wife, had borrowed quite significant funds from his mother to assist in the sale process, by the demolition of the existing structure, which had been then rendered inhabitable by virtue of the wife’s “renovations”, and the associated costs of marketing for sale.
125The husband continues to repay the loan to his mother, which, as discussed above, I find to be a loan and a current liability properly taken into account in the assessment of the parties’ overall asset position.
126Throughout the trial the wife referred, albeit with a lack of precision, to the difficulties faced by M over the last three years. There is no doubt that M has had some significant mental health problems, however, the only cogent evidence about the same was advanced by the husband. The wife primarily sought to use M’s health issues as an excuse for failing in her obligations in the proper conduct of the proceedings and for aspects of her management of the parties’ assets, although this did not explain what I consider to be her mismanagement of the same prior to M’s ill health.
127The wife’s disclosure has fallen short of any reasonable expectation and that which has been disclosed serves only support a conclusion of the chaotic manner in which the wife has managed financial affairs and her inability to reality test her financial schemes and expectations. In this context, I also observe that a large body of the annexures to the wife’s trial affidavit did not advance the wife’s case, but rather served to corroborate that of the husband.
128I do not accept any suggestion that the wife did not understand her obligation of disclosure. It is disturbing that in the past solicitors previously acting for the wife have attempted to defeat complaint about her failure to comply with her obligations with protestations of failure on behalf of the husband. Such protestations were rendered the more shallow given the relative simplicity of the husband’s financial circumstances and the effective total control over the assets that was reposed in the wife.
129The first of the properties Property C was purchased in April 2002 for the sum of $456,000 and was registered in the sole name of the husband. It was the intention of the parties that the same be their home.
130It was the husband’s case, about which he was not challenged, that the property was financed with payment of a modest deposit, with the original mortgage representing some 80 to 90 per cent of the purchase price. As a term of the borrowings the husband was required take out a significant life insurance policy, for which he continues to meet the premiums. Whilst there was a dispute about the need for the said insurance continuing, or whether it was necessary at all, I accept that the policy was taken out and that the husband’s understanding was that the same was required, and accordingly has been maintained at his expense.
131In 2006 Property A was purchased for the sum of $675,000, again in the sole name of the husband. Eighty per cent of the purchase price was borrowed, namely the sum of $540,000.
132The property was sold in July 2015, by which time the mortgage had increased to $861,253 unbeknownst to the husband, who had been remitting significant sums of money from his income to the wife to meet the mortgage payments which, to the husband’s understanding, both of principal and interest had been made throughout. The net sale of proceeds of the property in the sum of $30,662 remain held in the Westpac Choice bank account referred to as item 2 of the parties assets and liabilities in the schedule appearing above.
133The wife’s unsuccessful attempts to prevent the sale of Property A and Property B cost the parties’ penalty interest of $11,331 and each incurred significant legal costs dealing with this interim matter.
134Property D and Property E was purchased in the parties joint names in 2007 for the sum of $750,000, supported by borrowings of $600,000. The wife disputed that the property was jointly purchased and asserted it was purchased in the husband’s sole name.
135The husband summarises the position as to borrowings and the meeting of mortgage liabilities as follows: (exhibit omitted)
56.The total purchase cost of all the [Suburb A] properties was $1,881,000. I estimate that the total cost of the initial loans to buy the [Suburb A] properties was approximately $1,504,800 in total, i.e. 80% of the purchase price.
Current Loan Situation
57.The loans 1, 2 and 3 to Lloyds Bank are currently $1,332,681. Annexed hereto and marked as Exhibit 1 is a true copy of the Lloyds Bank statement of 26 September 2016. If one adds on the mortgages for [Property A] and [Property B] ($861,253 which has now been discharged) the total of the mortgages had risen to more than $2,262,775. In fact I understand that at one stage the mortgage for [Property A] rose to $880,000.
58.Instead of the mortgage balances being reduced over time (with principal and interest repayments) there had been an increase of approximately $757,975 in the mortgages. As far as I am aware during this time we were always paying principal and interest on the loans. This amount does not include the loan to [Mr N] of $330,000 and the monies still owed. Nor does it include the debts to my parents and [Mr F].
59.As at September 2016 the mortgage repayments are up to date. For [Property C], [Property D] and [Property E], I currently pay approximately ([Country E] & USD exchange rate dependent) AUD$17,164 per quarter. From January 2017 this will increase to AUD$ 24,202 per quarter or AUD$ 96,808 per year.
136In the course of holding the properties the wife commenced “renovations” to the property at Property C in 2003. The husband deposed that the wife did so with “little or no consultation or discussion”. In the context of her renovating the property she removed fittings and fixtures including ceilings, air conditioners, windows, doors and carpet. The husband described the results as “living in a home that was very run down, half renovated and shabby”. The wife’s renovations on Property C remained in progress in 2005 when the husband was transferred to Country D. The renovations were never completed and before its demolition the property was the subject of complaint by neighbours about its state and lack of maintenance, with parts of the property described by the husband as “falling off”.
137Such was the state of the property by 2013 that a decision was taken to demolish the existing structure and sell the land. The husband understood the purpose of the sale was to reduce the borrowings and consequential financial stress that he was experiencing in meeting the family liabilities. It was his understanding that the wife and the children moved out of Property C at the end of 2013 into the duplex property at Property D and Property E.
138As seen, the wife misrepresented the sale of Property C and I refer to the same further later in these reasons.
139The annexures to the wife’s trial affidavit confirmed the husband’s repeated concerns raised about the financial stress upon him, however, were ultimately disregarded by the wife, who continued to argue, by way of notations to the annexures, that the husband’s claims were baseless. Her claims in this regard were not put to the husband in any meaningful way.
140The husband deposed that a similar process of “renovation” took place at Property A, to the point once again where the property there was in such a state that it required demolition, the block thereafter being subdivided into two lots.
141The husband deposed to the same “renovation” process being undertaken with respect to Property D and Property E.
142In particular, of his last visit to the property in October 2014, he described Property D and Property E as being:
74.… in very poor condition. The windows, ceiling, rafters and the toilet have been removed; the bathroom is semi renovated. … The properties are uninhabitable and are not lettable in their current condition.
143The husband, validly in my view, raised concerns about the state of the property in which M is residing with the wife and the impact that the same may well be having upon his recovery. The husband deposed to having sought medical opinion that supported his conclusion in this regard, and as a consequence offered to provide alternate accommodation in which the wife and M could reside, but his proposal in this regard was rejected.
144In the valuation prepared by Mr G he described the improvements broadly being that “Each duplex has been largely stripped and ceilings removed”.
145In Property D and Property E, where the wife and M reside, he opined that the “kitchen is dated but still usable. Single sink; no stove; cupboards”.
146Of the bathroom, “Toilet pan and cistern have been removed from both duplexes”.
147Of the bedrooms in both duplexes, “All bedrooms have no ceilings”.
148He described the appearance and presentation of the property as poor. It is apparent from the photograph forming part of the valuation that, from the street, the front garden appears to be overgrown with weeds to a significant height and rubbish and/or building material is piled on the driveway in front of what appears to be a carport. The photographs included in Mr G’s valuation present as consistent with a property that is in the stages of demolition and support his conclusions.
149Mr G also undertook a valuation of Property C, which is now vacant land, and this valuation was reflected in the schedule of assets and liabilities.
150Mr G concluded that Property D and Property E should either be demolished or be subject to significant renovation.
151During the course of her evidence the wife was asked about her future plans for the property. She said that she still planned to renovate the property, but such plans were “in my head” and no physical plan had ever been produced.
152It was clear that notwithstanding the fact that the wife was not licensed to do so, she had undertaken a significant portion of the physical removal of the building structure of Property D and Property E, as she had done with Property A and Property B and Property C.
153The wife had annexed to her trial affidavit portions of valuations previously undertaken of Property C and Property D and Property E in 2012. She had not attached pages two to seven of the valuation, thereby excluding evidence of the state of the properties, however, the cover photograph of Property D and Property E shows at least a clear driveway and a less overgrown front garden.
The purported sale of Property C
154The husband deposed that in or about September 2013, the parties agreed to sell Property C and the wife emailed the husband in the following terms:
[Darling], [an expression of affection]
You have to put the money in asap because I need to have knock down done before mid december. Else I will need to re-apply with government which can take 3 to 4 months. Lloyds cannot stop sale, only if the sale value is lower than the mortgage value. So you putting the money in asap is crucial.
You cannot loose that money it is only lost on the day of sale. Once you have transferred the money I can move also with the sales date. So as soon as knock down no later than 25th December. I want to move fast because every one can take actions including demolition company for not complying. [Business B] contractors.
So all lloyds needs it the mortgage to be reduced at the moment it needs to be reduced by $120K but I think it should reduce by 150K. The buyer ([Mr N]) offered $600K, with flexibility meaning depending knockdown. All offer approximately this price.
Sent me the notice of remittance as soon as you have done it and I will get started in parallel with waiting for lloyds approval (because I know they cannot disapprove then). I need to move in parallel because the demolition contractor needs to set the date.
155The husband anticipated that the demolition of the property would proceed and he remitted the requested funds, although he had expressed some concern about the quantum. The husband’s requests for particulars about the sale and purchaser remained unanswered, however, on 17 September 2013, the wife emailed the husband in the following terms:
[Darling],
This form I will send to them once it has been transfered. Under point 3 you need to write where the money is coming from but pls do not write loan. You think what suits your parents to write.
Once the funds have been transfered to Lloyds, you need to send me the remittance advise. I will then fill out the amount you sent and the date it was sent and e-mail to them. Once that is done and received by them they will send me notification and approval.
When you send me notice of remittance, I will start straight away with contractors so it can all happen in parallel and there is no delay. Already have a buyer for [Property C] this is good.
These are the remittance details. It is best to transfer in USD because the loan is in USD if you transfer in any other currency Lloyds will then make the exchange according to their exchange rate schedule, which will be worse than the [Country B] bank. Euro/ US is fairly good at the moment.
BENEFICIARY BANK NAME: USD Bank of America
156The husband borrowed €93,000 from his mother and transferred the funds to the mortgage account operated by Lloyds Bank who was the mortgagee. Based on email advice received from the wife, the husband thereafter believed that Property C was unencumbered by security for borrowings and he believed the property to have been sold to Mr N.
157It was not until April 2015 that the husband learned that the property at Property C had not been sold, but remained registered in the name of Company A, subject to a mortgage to Lloyds Bank and was subject to a caveat by Mr N and Mrs N.
158I refer to the transfer of the property to Company A in 2007 later in these reasons.
159The unchallenged evidence of the husband was that he was never informed that Property C had not been sold and as I have observed above, the wife made a conscious decision to mislead the husband about such a sale, “to keep him quiet”.
160One of the financial challenges facing the parties is that the mortgage loans for which they are liable have been negotiated in foreign currencies.
161It was strongly argued by the wife that the parties stood to “make money” by having arrangements in foreign currency, and in fairness to her she had renegotiated some of the mortgage secured loans at rates below what would have been payable in Australia. She was, however, gambling against foreign currency exchange rates and whilst the interest rate may have been less, movements in the exchange rate had not necessarily been favourable.
162Further, there was a fundamental flaw in the wife’s case. She argued that the properties “make money”, however, the benefit of any capital gain is only enjoyed when the same is realised. The vacant land at Property C is not generating income, nor is the duplex property Property D and Property E, although the wife and M are residing in one of the units.
163The wife struggled to come to terms with the fact that cash flow was required to service the mortgages otherwise any gain that may be made through a lower interest rate, and indeed on the assumption of a favourable exchange rate, would be lost through the increase in the principal amount due as a result of capitalisation on unpaid interest. Her presentation of blank disbelief was incomprehensible, until it became apparent that her presumption of wealth creation was based on an enduring and seemingly lifetime commitment by the husband to meet all the mortgage payments and the wife’s support without question.
164Further, the wife’s renegotiation of the mortgage secured loan has not resulted in a reduction in the parties’ borrowings, but rather a significant increase.
165In addition, the wife has borrowed $330,000 from Mr N and Mrs N, however, the use of such funds has not been disclosed, nor was the subject of any evidence by the wife.
166I accept that the husband was unaware of the borrowings and remains uninformed as to the use of the funds, but accepts that funds are due, by the wife, to Mr N and Mrs N.
167At the commencement of the trial before me Mr N attended the court. As seen, at an earlier stage in the proceedings he and his wife had contemplated intervening in the proceedings, however he indicated to me that he was not appearing in that capacity but that he had attended merely to be sure that the Court was aware of he and his wife’s claim for funds due to them by the wife, as secured by the caveats lodged over the properties at Property C and Property D and Property E.
168In or about April 2014, an agreement was reached between the parties to effect a subdivision of Property A, given the property’s then state of disrepair. The wife indicated to the husband that she had made enquiries of the relevant Shire Council as to the ability to subdivide and pressed that there was urgency to do so before the area was rezoned.
169To assist in the costs of the demolition and subdivision of Property A, the husband borrowed funds from his father in the amount of €40,000. He entered into a written agreement with his father in support of the loan and has since repaid it.
170The wife represented to the husband that the monies needed to be paid to a company, Company E, to undertake the demolition.
171Company E, however, is a company of which the wife is the sole director and shareholder. She did not disclose that fact to the husband, nor has she disclosed to him the use of the funds borrowed from the husband’s father which were transferred for her use at her request.
172Towards the end of 2014 it was agreed that the property would be sold and the wife indicated to the husband that she “had a buyer”, although she never provided particulars of the proposed purchaser to the husband despite his enquiry. In April 2015 the husband again enquired as to the particulars of the buyer and was advised by the wife that the buyer “could not complete the sale until the end of 2015”.
173As the husband remained the sole registered proprietor of Property A and Property B, which unlike the other properties in Suburb A had not been transferred to a corporate entity by the wife, he listed the properties for sale and entered into contracts for sale.
174As discussed above, the wife lodged caveats over the subject properties and these proceedings were commenced to enable the husband to conclude the sales.
175It remained the wife’s position at trial that the properties should not have been sold and, as seen, she sought to reverse the sales, as she believed that there were future wealth creation possibilities in the retention of the properties. Her aspirational claims in this regard were not supported by any evidence, and again appeared to proceed on the basis that the husband would continue to meet any expenses associated with the holding of the property.
176In addition to the loans taken by the husband from his parents, he has also borrowed funds from a friend, Mr F. In particular, and at the wife’s urging, he borrowed $26,000 to pay out the Mercedes Benz motor vehicle being driven by the wife and M, to which I have referred earlier in these reasons. Further, the husband borrowed $20,000 from Mr F prior to the sale of Property A and Property B to assist with the expenses he was meeting at that stage associated with the mortgages and other outgoings.
177It was not disputed by the wife that these funds were borrowed from Mr F nor was it disputed that the husband has repaid the same.
The husband’s income
178As seen, the husband relocated to Country D in the context of his employment in 2005 and he remained in Country D until 2007.
179Thereafter he was based in Country E and remained there until October 2015.
180The husband’s remuneration was initially calculated in Euro and he has annexed to his trial affidavit payslips and explanations therefor.
181He calculates that his net Australian Dollar salary per month whilst in Country E had reached a level of $21,377, in addition to which he received “bonuses, share entitlements, travel allowances and an accommodation allowance”. The additional payments and salary, however, were subject to deductions for accommodation, shares savings scheme and car parking fees.
182Additionally the husband received an annual travel allowance of €25,200 that could be utilised to reimburse for personal travel expenses, that is to say that the husband would meet the cost initially and then claim reimbursement from his employer.
183The husband deposed that in 2014 and 2015 the greater portion of his travel allowance was spent on travel between Country E and Perth, however, in June and July 2015 he utilised an option to “cash in” some of his travel budget, although the same was then subject to a 26 per cent tax deduction. It was his case that he did so to meet the ongoing costs in maintaining the properties in Australia.
184Similarly, the husband has cashed in some of his Company B share entitlement. In particular he encashed all his vested share entitlement in 2015 to meet a payment on the wife’s credit card debt of $97,000. He has also received bonus payments and has been reliant upon those bonus payments to continue to meet ongoing family expenses and repay funds borrowed from his family and Mr F.
185Prior to 2015 the husband was remitting funds directly to the wife on the understanding that she was meeting the household expenses and the mortgage payments therefrom.
186In light of what the husband perceived to be the misrepresentations to him about financial matters and the increase in the mortgage liability, the husband resolved to directly meet the loan payments and pay to the wife the sum of $5,000 per calendar month and an additional payment of $4,000 (in total) for the two adult children, that is to say a total sum of $9,000 per month. It is clear from the wife’s evidence, however, that the wife “managed” the children’s funds, and essentially converted the funds to her own use or they were paid at her direction.
187In effect the wife was receiving in excess of $100,000 per annum net of any taxation liability from the husband, in addition to the mortgage costs that he was meeting of $70,000 per annum for the Australian properties and $12,000 per annum for the Country B Property.
188I accept that the husband was experiencing financial stress.
189In November 2015 the husband relocated in his employment from Country E to Country F. He deposed that his job in Country E had come to an end and that he elected to accept a position in Country F as he would earn a higher salary. The option available to him was to return to Country B, however, he deposed to his salary in those circumstances being significantly lower and equating to approximately 26 per cent of that which he would receive by accepting employment in Country F.
190His current net salary in Country F is approximately $10,000 per week. I accept that there are fluctuations in this figure due to allowances, currency movements and performance bonuses. I accept however, that whilst the husband’s financial position has improved through his employment in Country F, the same comes at a cost in terms of personal security and danger.
191The husband deposed:
148. Working in [Country F] carries significant risk to my safety and even to my life. There are many restrictions in place whilst I am living in [Country F]. I need to live in a compound secured by walls and armed guards.
149. When I travel to the airport I have a security escort with heavily armed guards in front and behind my vehicle to protect me from kidnap, robbery or shootings.
192The husband’s contract to work in Country F is due to continue until 1 November 2019, however, he deposed as to uncertainty given the current state of the industry in which he is employed and in particular referenced to there recently being large staff cuts at Company B, including in Country F where recently he has had to retrench 37 per cent of his staff.
193It is clear in my finding that the husband has made a significant direct financial contribution to the acquisition, preservation and maintenance of the assets and to the family.
194The husband’s contribution has not been mirrored by a non-financial contribution by the wife.
The wife’s non-financial contributions
195As seen, the wife has a plan for wealth creation, however, any objective assessment of the wife’s plan is not possible as the same is both uncertain and exists only within the thinking of the wife.
196In furtherance of her plan, however, she has caused the properties at Property C and Property D and Property E to be transferred to Company A, a company that she arranged to be incorporated in Country A. Her rationale for incorporating the company in Country A was that the tax rates for corporations in Country A were lower than those in Australia, and therefore any capital gains she realised from the sale of the properties or taxation liabilities from the income earned from the properties would be less.
197None of the properties held by Company A have ever generated an income, nor have they been the subject of sale or generated any other gain.
198To maintain the company in Country A the wife has a liability to a Country A management company, [Company G], to maintain compliance with Country A’s statutory requirements for incorporated bodies and also to maintain a Country A shareholder, albeit in a “silent” role.
199It would appear that no consideration has been given by the wife to the consequences of any transfer of funds to her from the Country A entity if any income or capital gain was realised, given her status as an Australian resident.
200There is no presently perceptible benefit from maintaining Company A. Indeed the wife has unpaid fees due to Company G.
201In addition to Company A the wife has incorporated other corporate entities, in particular Company D, an Australian proprietary limited company of which the wife is the sole shareholder and director, said to have been incorporated by her to “generate income from rents”.
202The wife established Company E again as the sole shareholder and director, which was set up as a maintenance company to maintain rental properties.
203The wife has also incorporated the companies [Company H], Company F and [Company I].
204Additionally a corporate trustee, [Company J], for what appears to be a self-managed superannuation scheme, Superannuation Fund A has been created. The limited partial documents that were annexed to the wife’s trial affidavit show both the husband and the wife as members, but do not disclose any balances or financial statements, beyond the wife’s assertion that the fund owes accounting fees and appears to have no assets.
205The companies were established by the wife with various intentions, including tapping into the foreign student market for rental and education. No documents by way of financial statements or returns have been disclosed for any of the companies. Some bank statements were disclosed for Company D.
206To further the wife’s income ambitions she undertook a course, at the husband’s expense to the sum of $6,000, to train as a salesperson. She purchased, without the husband’s knowledge, a rental roll for $40,000 to be managed through Company D, with Company E providing the maintenance services.
207The wife was unable to retain the properties the subject of her required rental roll, although I accept that the properties that she was managing may have been problematic, as she suggests. There was no evidence before the Court as to the eventual fate of the rental roll, though the wife deposed to effectively having abandoned the same.
208The wife had sought to establish a [retail] business, and in the context of maintaining a retail business and her various corporate entities concluded that she must have an office presence. She consequentially expended sums to providers of both real and “virtual” office spaces, in particular serviced office providers “[Business B]” and “[Business C]”, for no disclosed or apparent return.
209The wife has opened and maintained numerous bank accounts and credit cards. She has nine separate accounts with the National Australia Bank, in addition to accounts with Westpac Banking Corporation, Commonwealth Bank of Australia and Macquarie Bank. When asked why she had so many bank accounts, the wife said that this was the “way I do things” and she had viewed it as a means of avoiding paperwork. As evidenced by the limited disclosure given, funds appear to be simply moved from account to account for no apparent reason and with numerous descriptors, such as “God is watching us”, which do not identify the transferee, nor was the wife able to identify the transferee when questioned.
210The accounts disclose significant withdrawals, in particular the sum of $60,035 in cash that the wife explained as being deposited in Mr N and Mrs N’s account as “that is the way I did it”, however, no deposit slip or other collateral evidence was provided. Overall the wife could account for very little of the transactional history on the accounts, to the very limited extent that they were disclosed.
211In addition to the funds being received by her from the husband, the wife managed to amass significant credit card debt, which was ultimately reduced by the husband in the sum of $97,000 on one occasion. The husband was also meeting a David Jones American Express card solely utilised by the wife.
212The wife’s bank accounts and credit card statements demonstrate significant elective expenditure and the ongoing maintenance of expenses for “virtual offices”, a fleet card for the running of a motor vehicle, and significant storage costs, about which the wife’s evidence was so confused as to be incomprehensible, as were her explanations for incurring significant freight costs to send furniture and pets to N whilst she was residing for a short time in Country C.
213I have already observed as to the absence of any evidence of the enhancement of the value of real estate holdings by the wife’s various “renovations” and note the observations of the Single Expert Witness as to the state of the “improvements” on Property D and Property E and the subsequent necessity for extensive renovation or demolition of the same prior to sale. Indeed, the partial valuation annexed to the wife’s affidavit shows a significant fall in the value of Property C, from $800,000 to the current value of $690,000.
214It is difficult to conclude that the wife’s non-financial contributions have in any way added to or maintained the value of any asset, the same must also be balanced against the unexplained additional borrowings taken by her.
215None of my above observations however, are to be taken to conclude that I find against the wife as a parent and carer of the parties’ two children. There is no doubt that she undertook the vast majority of that responsibility and that her contribution in that regard was significant.
216There is no doubt that the husband has contributed significantly to the financial support of the children and has maintained relationships with them, albeit fractured in recent years. He continues and offers to continue to support them financially.
217The husband’s position on contribution was that the same is balanced significantly in his favour, particularly subsequent to the parties’ separation, a conclusion that is irrefutable in my finding.
Section 75(2) factors
218The factors to be taken into account in assessing whether it is necessary to vary a proposed outcome based on contribution to effect a just and equitable outcome overall are as I have set out:
(2)The matters to be so taken into account are:
(a)the age and state of health of each of the parties; and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i)himself or herself; and
(ii)a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii)any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party’s role as a parent; and
(m)if either party is cohabiting with another person—the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i)the property of the parties; or
(ii)vested bankruptcy property in relation to a bankrupt party; and
(naa)the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i)a party to the marriage; or
(ii)a person who is a party to a de facto relationship with a party to the marriage; or
(iii)the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement that is binding on the parties to the marriage; and
(q)the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
219Not each of the above matters will apply in every case and accordingly I refer only to those that I consider to be relevant to the determination of these proceedings.
(a) The age and state of health of each of the parties
220Each of the parties appear to be in good health and are of an age where there should not be any impediment to them obtaining employment.
(b) The income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment
221The husband has a clearly identifiable income.
222The property and financial resources for division between the parties are those prescribed above.
223Upon the conclusion of the proceedings and the implementation of the orders that I propose to make, the wife will have a financial resource available to her by way of cash to re-establish herself.
224There was no evidence of any physical or mental capacity that would restrict the wife from undertaking gainful employment. She has qualifications and experience in the area of sales. It was the wife’s case that she “may never be employed due to no experience and looking after son”. Although she presented her case in the manner I have described, the wife is clearly highly intelligent and a strongly motivated person, who in my assessment, and particularly with a more structured approach, has the capacity to make a success of her endeavours.
(c) Whether either party has the care or control of a child of the marriage who has not attained the age of 18 years
225Neither of the parties has a child of the marriage who has not attained the age of 18 years.
(d) Commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain
226There is no doubt that the husband has the greater capacity to meet his necessarily incurred costs and those of his now partner, the husband having re-partnered and living in a de facto relationship.
227The wife has a yet unrealised capacity to earn, however, in my finding the lack of realisation of that capacity is not as a result of any impediment, but rather choices that the wife has made and through labouring under a flawed premise that she was entitled to support from the husband without question.
228It is not possible on the presentation of the wife’s evidence to make any definitive finding as to what her necessary commitments are. Despite seeking an order for spousal maintenance, she did not complete her statement of financial circumstances in a form that would assist the Court to make such an assessment. The wife’s limited disclosure does not assist the Court in making any assessment.
229The wife’s failure in this regard does not assist in the advance of her claim for spousal maintenance, to which I refer later in these reasons, acknowledging that the factors prescribed under s 75(2) of the Act are also relevant to that claim, subject to me being satisfied that the jurisdiction of the Court to make an order for spousal maintenance is properly enlivened.
230Whilst I accept that the wife assumes care for M, the extent of his need for care has not been established and I refer further to his entitlement to support in my consideration of the wife’s claim for adult child maintenance.
231I do accept that the husband has proposed to continue to offer financial support to each of the children and will do so without the existence of an order.
(f) Subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party
232I have referred to the parties’ respective entitlements pursuant to the Company B pension scheme. No doubt whilst the husband continues in employment his entitlements will grow. The wife’s separate entitlements will vest in due course and it is common ground that she will be entitled to a pension.
233The wife has established the Superannuation Fund A which appears to have a bank account of $30, although the wife suggests that it is overdrawn as the fund is in fact in deficit due to an obligation to pay accountancy fees, by virtue of her notation on the assets and liabilities schedule admitted as exhibit two.
234The wife has not disclosed any entitlement to superannuation and has disclosed nothing that would assist the Court in making a positive determination as to what her entitlements in the Superannuation Fund A might be.
(g) Where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable
235The standard of living that the wife enjoys by way of accommodation is poor, however, this has been of her own doing. Financially however, the wife has been able to enjoy a high standard of living subject to her election as to expenditure.
236In terms of accommodation it is likely that the wife will have to secure separate accommodation in the short term and during the implementation of my proposed orders, as short of the parties risking a significant investment in the renovation of Property D and Property E as contemplated by Mr G, the property is likely to have to be demolished for sale, subject to relevant advice as at the time of sale.
(h) The extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income
237The husband has previously paid for the wife to undertake a course that would enable her to be employed in the area of retail. The wife created a corporate structure in anticipation of her successfully conducting a business in that arena. There was no evidence of any physical or mental impairment that would prevent the wife from further pursuing her endeavours in that regard within the structure she has established. The wife asserted that her retail operating license had been suspended subject to her meeting the required continuing professional development courses.
(ha) The effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant
238In the orders I propose to make in this matter the wife will retain the liability to discharge the debt to Mr N and Mrs N. It is contemplated that the same will be payable on settlement of the Suburb B properties to secure a withdrawal of the caveats registered over Property C and Property D and Property E. In my finding, for reasons set out above, the wife should bear sole responsibility for that debt and the same will be deducted from her entitlements upon the sale of the Suburb B properties.
239The balance of the debt due to the husband’s mother is properly borne by both parties in my finding, for it was advanced specifically to assist the parties in the circumstances I have described above. As such, it is properly treated as a joint liability to be discharged upon the sale of the Suburb B properties or otherwise adjusted against any payment made to the wife by the husband on the assumption that he will meet the liability.
240The balance of the matters to be considered under s 75(2) of the Act have otherwise been considered above in the context of those matters to which I have referred or elsewhere in these reasons.
Discussion
241In the longer term the husband’s financial fortunes are likely to be better than the wife’s, subject to her utilising her energy and focusing upon the realisation of her earning capacity.
242There was no evidence before me as to what income the wife will realise from the utilisation of her earning capacity. The difficulty I face as a result of the wife’s failure to place proper or adequate evidence before the Court is evaluating her future earning capacity and financial responsibilities, however, based upon the parties’ likely differential in future earnings, particularly whilst the husband remains employed in Country F until the end of 2019, an adjustment in favour of the wife is warranted.
243If the husband thereafter is required by his employer to resume employment in Country B, I accept his income will be reduced by approximately two thirds.
244On balance the s 75(2) factors prevail in favour of the wife, however, as discussed below, I defer my final conclusion pending the sale of the Australian real property.
The wife’s spousal maintenance claim
245Section 72 of the Act prescribes as follows:
72Right of spouse to maintenance
(1)A party to a marriage is liable to maintain the other party, to the extent that the first‑mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:
(a)by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;
(b)by reason of age or physical or mental incapacity for appropriate gainful employment; or
(c)for any other adequate reason;
having regard to any relevant matter referred to in subsection 75(2).
(2)The liability under subsection (1) of a bankrupt party to a marriage to maintain the other party may be satisfied, in whole or in part, by way of the transfer of vested bankruptcy property in relation to the bankrupt party if the court makes an order under this Part for the transfer.
246The wife has not advanced any evidence that supports a claim for maintenance.
247The evidence that she has provided and the disclosure she has given, limited as it was, has served only to cloud the true financial circumstances of the wife with numerous unexplained transactions.
248The wife clearly sees herself as a resourceful woman, and I do not doubt that she is, but as of yet she has not elected to positively utilise those resources.
249I do not disregard the fact that the wife has principally been financially dependent upon the husband for a significant period of time, but that of itself does not negate her capacity to support herself.
250Nor was there adequate evidence before me that would demonstrate that the support she provides to M is of a nature that would limit her capacity to earn, such as to demonstrate any other adequate reason for making a spousal maintenance order in the wife’s favour.
251The quantum of the wife’s claim is fanciful and is commensurate with equivalent Australian gross earnings approaching $500,000 per annum. There was no evidence that supports such a need.
252That being said, given that I propose to order the sale of the Suburb A properties, I accept that in the short term the wife will be rendered without a place to live pending the sale, particularly as it would appear that demolition of Property D and Property E would be required and that it may be the case that upon the sale of Property C the secured creditors will take 100 per cent of the proceeds of sale.
253It would in those circumstances be appropriate for the husband to contribute to the rental of a property for the wife pending the sale of the property and I will hear from the parties as to an appropriate amount.
254I propose this course purely on an interim basis and, noting the husband’s offers in this regard, pending the sale of the Suburb A properties and the payment of the ordered sum to the wife. Otherwise the wife’s claim for spousal maintenance will stand dismissed.
Adult child maintenance
255As seen, the husband has contributed significantly to the financial support of the children in the past and, indeed, proposed to continue to do so in the absence of an order. He opposed the making of an order, but I accept that he continues to be committed to contribute to the children’s support.
256Section 66L of the Act prescribes the threshold requirements for the making of an adult child maintenance order thus:
66LChildren who are 18 or over
(1)A court must not make a child maintenance order in relation to a child who is 18 or over unless the court is satisfied that the provision of the maintenance is necessary:
(a)to enable the child to complete his or her education; or
(b)because of a mental or physical disability of the child.
The court may make such a child maintenance order, in relation to a child who is 17, to take effect when or after the child turns 18.
(2)A court must not make a child maintenance order in relation to a child that extends beyond the day on which the child will turn 18 unless the court is satisfied that the provision of the maintenance beyond that day is necessary:
(a)to enable the child to complete his or her education; or
(b)because of a mental or physical disability of the child.
(3)A child maintenance order in relation to a child stops being in force when the child turns 18 unless the order is expressed to continue in force after then.
257There was no clear or professional evidence before the Court that satisfied the criterion established by s 66L.
258I do not ignore the evidence of the difficulties that M has faced in recent years, however, there was no objective evidence before me as to the impact that this has had upon his capacity to support himself nor was there any evidence as to his future educational needs.
259As I have already observed, historically the wife has utilised the maintenance paid for the children for her own pursuits, I acknowledge that therefrom she has included expenses for the children, whether reasonable or otherwise.
260Further, in my finding the wife’s evidence regarding her adult child maintenance application was inherently unreliable. There was nothing before me as to neither N’s nor M’s financial circumstances.
261In the circumstances, I cannot be persuaded that I should make an adult child maintenance order, particularly having regard to the mandatory provisions as prescribed in s 66L of the Act.
262Accordingly the wife’s claims for adult child maintenance will stand dismissed.
Conclusion
263As I have noted above, I have concluded that the remaining Suburb A properties should be sold. There is no evidence of any future benefit to be had by the retention of the properties, which only the wife sought. Further, she does not have any demonstrated capacity to assume any liability attaching to the properties.
264As to the Country B Property, only the husband has advanced any reason of substance for his retaining of the same. His unchallenged evidence was that there is a real possibility that he will return to reside in Country B in the context of his employment; indeed this was a possibility prior to him commencing his employment in Country F and is evidenced by communications annexed to the wife’s trial affidavit.
265Pending the sale and likely demolition of Property D and Property E, the wife and presumably M will require alternative accommodation. The husband has previously offered to provide the same and I accept that his offer was genuine. I also accept that pending the sale of the Suburb A properties there is no disclosed financial resource that the wife could call upon to meet her costs of accommodation.
266In circumstances where it appears inevitable that Property D and Property E will need to be demolished, there will be further expenses incurred prior to sale of the same and again, in the absence of any disclosed financial reserve of the wife, these expenses will necessarily have to be borne by the husband. This additional cost incurred by the husband will to some extent be offset by the reduction in his monthly outgoings by way of spousal maintenance, as I propose to dismiss the wife’s claim for spousal maintenance other an appropriate allowance for the provision of accommodation for a limited period of time, the quantum of which I will determine after hearing from counsel for the husband and the wife.
267The husband has to date maintained the mortgage secured loan payments on all properties and were he to cease making these payments pending the sale of the properties, the same would only further diminish the already limited asset pool. I propose to order that the husband continue to meet the mortgage payments pending sale of the properties or until further order, whichever is the earlier in time.
268At the commencement of the trial the husband had sought orders that would appoint both he and the wife as joint trustees for the sale of the Suburb A properties. He altered his position at the conclusion of the trial, seeking orders that he be appointed as sole trustee. Given the wife’s history of prevarication and misrepresentation, I am satisfied that the appointment of the husband as sole trustee for the sales is the proper order.
269During the course of the trial, particularly given the relative uncertainties as to what the final asset position of the parties would be, I canvassed the possibility of ordering a sale of the properties and reserving determination of what the final distribution of the proceeds after payment out of the secured loans, the loan to Mr N and Mrs N and the husband’s mother.
270The husband agreed to such an approach. The wife did not, however I accept that from her position such an approach was incompatible with the final orders that she was seeking.
271I have a real concern that upon the ultimate sale of the properties there may not be sufficient funds, apart from the equity in the Country B property, such that were I to determine the matter on a percentage outcome basis at this point the same may ultimately produce a result that is not just and equitable in all the circumstances.
272In these circumstances, I am satisfied that I should defer the final exercise of my discretion as to the adjustment of the parties’ property interests pending the sale and settlement of the Suburb A properties on the terms that I have proposed.
273I will hear from counsel for the husband and the wife as to the appropriate terms of orders.
274I also have residual concerns about the Superannuation Fund A and its current status and whether or not an order is required by way of a superannuation splitting order that would vest the husband’s entitlements in the fund to the wife, to the extent that any exist.
275I will hear from counsel for the husband and the wife as to this issue, also whether the same should be made at this point or in the context of my final orders.
276For these reasons I determine the matter as I have foreshadowed.
I certify that the preceding [276] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court
Associate
30 May 2017
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