Hosey and Hosey
[2015] FCCA 579
•15 September 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| HOSEY & HOSEY | [2015] FCCA 579 |
| Catchwords: FAMILY LAW – Property – disputed marital liabilities – contributions – justice and equity – property adjustment. |
| Legislation: Family Law Act 1975, ss.79(2) and (4), 75(2) |
| Applicant: | MS HOSEY |
| Respondent: | MR HOSEY |
| File Number: | PAC 3154 of 2013 |
| Judgment of: | Judge Newbrun |
| Hearing dates: | 12 & 13 March, 21 May & 7 July 2015 |
| Date of Last Submission: | 7 July 2015 |
| Delivered at: | Parramatta |
| Delivered on: | 15 September 2015 |
REPRESENTATION
| Counsel for the Applicant: | Ms Druitt |
| Solicitors for the Applicant: | Watson Stafford Zipkis |
| Counsel for the Respondent: | Mr Henness |
| Solicitors for the Respondent: | Carters Law Firm |
ORDERS
That within three months from this date, the wife pay to the husband $38,743 and concurrently with the payment, the husband do all things necessary to transfer to the wife his interest in the property at Property M, New South Wales, being the whole of the land comprised in Certificate of Title folio identifier (omitted) provided always:
(a)that concurrently with the transfer the wife refinance the present mortgage secured over the property to her name so as to release the husband from all or any liability in regard thereto
(b)the wife shall indemnify the husband from any and all liability in relation to the mortgage
(c)that the wife pay as they fall due and payable all outgoings, insurances and mortgage payments in regard to the property pending transfer of the property to the wife
That within one month from this date, the wife assign to the husband the $25,828 insurance payment from (omitted) Insurance currently held in her solicitor’s trust account relating to the claim for flood damage in 2011.
The wife be declared solely liable to pay:
(a)the parties’ (omitted) Personal Loan account debt
(b)the parties’ (omitted) Credit Line account debt
(c)the wife’s (omitted) Bank MasterCard account debt
The husband be declared solely liable to pay:
(a)the (omitted) Bank MasterCard credit card account, number (omitted)
(b)the (omitted) Bank Personal Loan account, number (omitted)
(c)all other personal loans and all other credit card accounts in his sole name
That as between each other the wife and the husband otherwise shall be each respectively entitled to retain their interest or entitlement to personal property in her or his respective possession or control including any entitlement to superannuation.
Liberty to apply as to implementation or enforcement of these orders.
IT IS NOTED that publication of this judgment under the pseudonym Hosey & Hosey is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT PARRAMATTA |
PAC 3154 of 2013
| MS HOSEY |
Applicant
And
| MR HOSEY |
Respondent
REASONS FOR JUDGMENT
Introduction
These are property proceedings between Ms Hosey (“the wife”) and Mr Hosey (“the husband”) pursuant to section 79(1) of the Family Law Act 1975, as amended (“the Act”). There were no children of the relationship. The marriage was for some six years.
At the hearing, the wife relied on the following documents:
a)Affidavit of the Wife sworn 24 February 2015 and filed 25 February 2015.
b)Affidavit of the Wife sworn 4 March 2015 and filed 6 March 2015.
c)Financial statement sworn 24 February 2015.
The husband relied on the following documents:
a)Affidavit of the Husband sworn 26 February 2015 and filed 27 February 2015.
b)Affidavit of the Husband sworn 13 September 2013 and filed 20 September 2013.
c)Financial statement sworn 24 February 2015.
In the wife’s written submissions dated 27 March 2015, under the heading “Justice and Equity”, the wife proposed that the just outcome would be to allow the wife to retain the former matrimonial home, with the husband transferring the property to her name, and for the husband to be paid the insurance payout as currently held by the wife’s solicitors in return for the wife’s indemnity as to the pre-separation borrowings. These pre-separation borrowings were referred to in the wife’s written submissions and related to the mortgage to (omitted) Bank, the (omitted) Personal Loan and (omitted) Credit Line, the wife’s (omitted) Bank MasterCard, the husband’s (omitted) Bank MasterCard ((omitted)) and the husband’s (omitted) Bank loan ((omitted)).
In the husband’s written submissions dated 10 April 2015, under the heading “Division of Assets”, the husband proposed that the appropriate property adjustment between the parties, take into account the financial and non-financial competitions, the respective finances and liabilities of the parties, should be 60% in favour of the wife and 40% to the husband. The husband’s written submissions set out the manner in which the submitted division of 40% to the husband and 60% to the wife should be effected.
During the course of the hearing a number of documentary exhibits were tendered.[1]
[1] Exhibit A – Email to husband dated 16/8/13 from (omitted)
At the hearing, both the husband and wife were cross-examined. The expert valuer and licensed builder, Mr S, was cross-examined on his affidavit (exhibit F) through a telephone linkup to the court.
Evidence
The wife was born in 1960 in Sydney and is now aged 55 years. The husband was born in 1963 in (country omitted) and is now aged 52 years.
The wife became an (occupation omitted) in (employer omitted) in 1997 and has worked in that occupation since that time. Since 1999, the husband has worked as a (occupation omitted). The parties married on (omitted) 2004 and finally separated in May 2010.
The wife had three adult children from a prior relationship; X born in 1980, Y born in 1983 and Z born in 1994. She had separated from her former husband, Mr R, in 1995. The wife retained her surname “(omitted)”.
In 1997 the wife purchased a residential property at Property M $187,000 (the property). The source of funds for the purchase price, and related expenses, was $150,000 from Mr R and an amount of $50,000 was borrowed by the wife. The mortgagee was ((omitted)). In (omitted) 1998 the property was formally transferred into the name of the wife. The wife made the loan repayments from her income working as a (occupation omitted) at (employer omitted). In 2001 she began a second job as a (occupation omitted) at (employer omitted) (later to be known as (employer omitted)).
By January 2004, the mortgage on the property had increased to about $212,000 as the wife had borrowed a further $150,000.
The parties met in the early 2004. In about July 2004 the wife and her son Z lived in the husband’s two-bedroom rented apartment in (omitted) for a short period. This was whilst the property was listed on the market for sale. After a short time, there having been no interest from any prospective purchaser, the parties decided to move into the property in late 2004. The parties married on (omitted) 2004.
At the commencement of the marriage, the wife owned the property, valued at $400,000 (valuation of (omitted) Pty Ltd of 8 November 2004; annexure C to wife’s affidavit sworn 24 February 2015) less a mortgage of $212,000 (asserted by the wife in her said affidavit and which fact was agreed to by the husband in cross examination).
The wife also owned a Hyundai sedan, purchased in 2003 for about $2,000 together with the furnishings in the property. The wife also had superannuation at this time but its value was not revealed in evidence. The superannuation value had a value of $37,484 as at
30 June 2007.
The husband’s assets at the commencement of the marriage included a motor vehicle and furniture in his two-bedroom apartment that he was renting in (omitted). He had superannuation of about $26,135 (exhibit A).
The husband obtained a loan of about $20,000 a couple of months before the parties’ marriage. The wife’s affidavit evidence was that the husband’s parents had visited Sydney from (country omitted) in 2004 and that the husband told the wife that he had taken out a loan of about $20,000 before they had met to show his parents around. This evidence was not disputed by the husband. The court does not accept the husband’s oral evidence, belatedly in re-examination, that he used this loan “partially to pay a little bit for the car and the rest was when we started doing the renovation.” The court finds that this loan was utilised by the husband for the purpose stated to the wife, and accepts the wife’s evidence in this respect.
The parties decided to jointly refinance the mortgage on the property. They had decided to renovate the property. The husband would not commit to a mortgage if his name was not on the title to the property. The wife agreed to have the husband become a joint owner of the property. Title to the property was transferred into the names of the husband and wife as joint tenants in October 2005.
Accordingly, in October 2004 the mortgage on the property was refinanced with (omitted) Bank. In the relevant “Residential Loan Agreement” the mortgagor was stated to be the wife. The borrowers were stated to be the wife and the husband. The borrowing was stated to be $290,000.
The additional borrowings under the joint refinance with (omitted) Bank, some $78,000 (being the difference between $212,000 and $290,000.), were used to:
a)purchase a Toyota Corolla for the husband in the sum of about $20,000
b)pay out the loan of the husband in the sum of about $20,000, referred to above, and
c)conduct renovations to the property, including repainting of the property, installation of ducted air-conditioning, and construction of a rear awning
On about 29 November 2004, the mortgage loan on the property was increased by about $14,500 to over $304,000.
In February 2005 the mortgage loan on the property was increased by about $14,800 to over $319,000.
In April 2005 the mortgage loan on the property was increased by about $20,000 to over $338,000.
In 2004 and 2005 some repair and renovation work was carried out on the property. The husband carried out some work. The extent of his work was disputed by the wife. The husband adduced no documentary evidence in support of his alleged work. The court finds that the husband carried out the following work:
a)replaced some leaking taps
b)replaced some faulty power points
c)installed some light fittings
d)replaced the locks on screen door and front door
e)installed a new security alarm system
f)caused a person to install lighting in the interior roof
g)assisted to install a hi fi surround system in the lounge room
h)installed 2 televisions
i)installed a fish tank
j)repaired rails for a built in wardrobe in the bedroom
k)sprayed some pesticides inside the house
l)installed a window in the dining room after an air-conditioning unit had been removed
m)installed magnet door stoppers on 2 doors
n)made two garden beds for vegetables
o)erected a garden shed
p)erected 2 aviaries
q)installed sensor lights at the front door
r)pressure cleaned and resealed front and back and swimming pool area
s)installed a new pump, sand filter and automatic chlorinator for the swimming pool
t)assisted in painting a new carport with the rest of the family
u)repaired a crack in the swimming pool wall
v)installed some garden lighting
w)planted over 60 new plants in the garden after removing the wife’s plants
x)removed broken tiles and gravel after a bobcat had dug up the carport drive
The cost of the items relating to the husband’s above renovation and repair work was paid jointly by the parties.
The husband also alleged that further renovations to the property were carried out by trade persons during the relationship, and which were paid by the parties. The court finds that the following work, paid for by the parties, was carried out and which was conceded by the wife:
a)the installation of ducted air-conditioning;
b)moving a carport from the front of the property to the back;
c)entertainment awning;
d)the repainting of the house;
e)the re-concreting of the carport area;
f)the concreting of a small area within the swimming pool area
g)installation of ceiling fans in three rooms;
h)installation of satellite dish;
i)installation of new hot water system;
j)installation of new oven;
k)outdoor table and chairs;
l)kitchen dining table and 4 chairs;
m)some bedroom furniture for the youngest child;
n)an entertainment unit;
o)an inexpensive painting;
As stated above, the husband erected one of 2 garden sheds and the aviaries. He also jointly paid with the wife the entertainment awning. In this context, the husband relied upon the expert report of Mr S, valuer and licensed builder (exhibit F) to contend that those particular renovations (the 2 garden sheds, the aviaries, and the entertainment awning) had added value to the property. The expert had valued the “carport/entertainment awning” (85 m² at $450 per square metre) at $38,250 (less depreciation of 33%). He had valued the “Lawn locker/aviary area” (42 m² at $350 per square metre) at $14,700 (less depreciation of 33%) leaving $9,849.
In (omitted) 2005 the parties travelled to (country omitted), (country omitted) and (country omitted), staying for one month. The trip cost about $30,000 and the parties had a credit card for the trip with a limit of $5,000.
In about March 2008 a mortgage loan of $401,904 was advanced by the (omitted) Bank to the parties as borrowers. This loan was used to:
a)repay $4,015.72 off an existing (omitted) Bank loan
b)repay $357,423.85 to (omitted) Bank (it appears that the mortgage to (omitted) Bank was re-financed to (omitted) Bank at some time between April 2005 and March 2008)
c)repay a (omitted) Bank credit card (in the names of the parties) of $16,505.83
d)pay a (omitted) Bank credit card of $10,840.15
e)pay $5,444.45 to the parties
In about 2008 the wife underwent an IVF treatment program. The program was not successful. The program cost at least $7,000 which was substantially paid off by the parties during the relationship.
During the marriage the debts of the parties began to accumulate and finances became tight; although the husband had a more hands on role with the marital finances, both parties were aware that these events were occurring.
The wife worked two jobs as a (occupation omitted), working very long hours each week, often up to 100 hours. The wife would usually get home late in the evening and was exhausted. She was not at home for extensive periods.
The husband was usually working in the order of 50 hours each week during the marriage in his employment as a (occupation omitted). He cared for and supervised the child Z when the wife was not at home.
The wife’s youngest son Z lived with the parties during the marriage attending primary school and high school. The husband treated him like his own son, and helped him with his homework and extracurricular activities. The parties paid his living expenses, including school fees, uniforms, books and stationery. The child’s biological father paid child support in the sum of $35 per fortnight. The wife also received some financial assistance from the Department of Veterans Affairs.
The wage received by the wife from her full-time job was paid into a joint account at the (omitted) bank. The husband paid the various household expenses from this account.
The wage received by the wife from her second job, on a casual basis, was paid into her own bank account at the (omitted) bank. However each fortnight she withdrew cash amounts of about $400 to $800 and gave such amounts to the husband. The husband deposited those sums into his own (omitted) Bank account.
From about October 2004 until about mid June 2010, all of the mortgage repayments on the property were paid from the husband’s wages; all home loan repayments came from his account into which his pay was deposited.
For about the first four years of the marriage, the husband’s income was usually more than what the wife was earning in her two jobs; for example, as at April 2005 the husband’s income was $43,454 compared to the wife’s income at that time of $29,094.
X and her children lived with the parties on three separate occasions totalling about 12 months. X did not assist financially towards the household expenses during the periods that she and her children lived with the parties.
Y lived with the parties on three different occasions during the marriage for about two months in total. Throughout the marriage, the husband assisted him financially by way of giving him cash monies, registering his car, bailing him out of jail, and paying his legal fees. Y never assisted financially towards household expenses.
During the marriage both parties carried out the domestic duties including cooking, washing and cleaning. The husband did somewhat more of these duties because of the wife’s long hours of work in her two jobs.
In (omitted) 2009 the husband travelled to (country omitted) visiting friends and relatives and stayed 34 days.
In (omitted) 2010 the husband travelled to (country omitted) visiting friends and relatives for 21 days.
From about (omitted) 2009, although the parties shared the same bed, there was no intimacy. They also ceased attending social engagements together. However, the wife was trying to work out their marital problems up until about May 2010 when the husband moved out of the property, taking his personal possessions with them. The court finds that the parties separated in about May 2010.
Over the next few months after the separation, the husband returned to the property to collect some furniture and other goods.
The husband, after separation in May 2010, apart from his last mortgage repayment in about mid June 2010 (Exhibit E), did not make any payments towards the mortgage, or household expenses relating to the property.
At separation in May 2010 the husband had the following debts in his name, which had accrued during the marriage and should be regarded as marital debts:
a)(omitted) Bank personal loan (account number (omitted)) $25,326. The wife conceded in her written submissions that this debt should be taken into account in the asset pool as existing at separation. The parties have agreed, since the court reserved its judgment, that this account has a current balance of $13,342 (rounded up).
b)(omitted) MasterCard account (account number (omitted)) as at 28 May 2010 was $19,547.06. As at 24 September 2014 it was about $12,600; the wife concedes that the amount of $12,600 should be taken into account in the asset pool.
Since separation in May 2010, the husband has had 7 overseas trips; (omitted) 22 days, (omitted) 10 days,. (omitted) 6 days, (omitted) 21 days, (omitted) 8 days, (omitted) 14 days, (omitted) 35 days. He paid for the tickets through his own credit cards or loans. He stayed in hotels, apart from in (omitted). The husband’s trips are set out in the travel records (exhibit B). The husband’s oral evidence about these trips, including the length of time that he stayed in particular places, and alleged reimbursement by others for the cost of the trips, was vague, inconsistent and not persuasive. The husband produced no documentary evidence in respect to the alleged reimbursement of these trips by other persons. The husband’s Financial Statement of
24 February 2015 was inconsistent with his claim of reimbursement. The court is not satisfied that the husband was reimbursed. Further, the court is of the view that the travel records (Exhibit B) are the most reliable evidence relating to the overseas places that the husband travelled to after the parties’ separation and the length of time he stayed in those places.
The husband alleged he accrued a debt during the marriage to Mr T, an Australian resident. He alleged that at separation the debt was some $32,500. He also alleged that his brother in law had lent him monies in the order of some $6,000 after separation which indirectly related to the marriage. The wife had stated that at times during the marriage the husband told her that he had borrowed money from a friend without providing significant detail. Nevertheless, the husband produced no documentary evidence in any respect to support these allegations. The persons did not give evidence. The husband’s oral evidence on this subject was vague, inconsistent, and not persuasive. The court is not satisfied that the alleged debts exist.
When the parties separated in about May 2010, all the documents relating to the property and finance remained in the property.
In June 2007 the wife’s superannuation was $37,484, in June 2010 it was $48,516. On 18 January 2011 the wife withdrew $19,815 from her superannuation fund; an amount of $4,000 was used to pay tax and $15,000 was applied in reduction of the mortgage. Her superannuation balance as at 30 June 2011 was $39,030. As at 30 June 2014 it was $74,641.
In about mid April 2009 the (omitted) Personal Loan debt was about $32,457. The original amount borrowed was about $35,000. Thereafter the wife consistently made repayments and the debt at trial date was about $7,900. Similarly, the wife consistently made repayments on the (omitted) Credit Line account and the balance at trial date is about $5,500. The wife paid the (omitted) Personal Loan debt the whole time with her wages from her second job. Since separation in May 2010 the wife has been solely making payments on the (omitted) Personal Loan debt and (omitted) Credit Line account.
In 2011 the property was flooded in a storm. The wife made an insurance claim which was admitted. The relevant insurance policy was in the joint names of the husband and wife. Repairs to the property were undertaken through the insurer. A further amount of $25,828 is due to be paid under the policy and is held in the trust account of the wife’s solicitors.
The wife has been paying the (omitted) Bank MasterCard account in her name of $100 per week.
After separation in May 2010, the husband obtained two (omitted) Bank credit cards and one (omitted) Bank credit card; the total indebtedness at trial date was about $30,094. He also obtained two loans from (omitted) Bank after the separation in May 2010 which at trial date was about $25,935.
The mortgage balance as at May 2010 was about $390,000.
The mortgage balance as at 31 December 2014 was $353,891.
The wife’s expenses as at trial date are generally greater than her income. The wife receives financial assistance from her daughter X, about $300 per week. Her sister provides groceries weekly together with $30 per week for petrol.
Property Adjustment
Pursuant to section 79 (1)(a) of the Act, in property settlement proceedings, the court may make such order as it considers appropriate, in the case of proceedings with respect to the property of the parties to the marriage or either of them, altering the interests of the parties to the marriage in the property. Such order may include an order requiring either or both of the parties to the marriage to make, for the benefit of either or both of the parties to the marriage, such transfer of property as the court determines.
The court, in determining property proceedings, should firstly identify, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property that is available for distribution between them. The court should then determine whether it is just and equitable to make an order altering the parties’ interests in such property. If the court is satisfied that it is so just and equitable, the court should then consider the contributions made by each of the parties pursuant to section 79(4) of the Act before looking at their future needs by reference to the factors set out under section 75(2) of the Act.
The Parties’ Assets and Liabilities
Written submissions were provided to the court by the parties. Based upon those submissions, the competing contentions for the parties’ present assets and liabilities are set out below.
| Ownership | Description | Wife’s Value | Husband’s Value | ||||||
| ASSETS | |||||||||
| 1 | Joint | Property Property M | $650,000 | $650,000 | |||||
| 2 | Joint | (omitted) Insurance Money | $25,828 | $25,828 | |||||
| 3 | Wife | Car – 2003 Hyundai Accent Sedan | $2,000 | $2,000 | |||||
| 4 | Husband | Car – 2004 Toyota Corolla | $4,000 | $4,000 | |||||
| 5 | Wife | Household contents | $5,000 | ||||||
| 6 | Husband | Household contents | $700 | ||||||
| Total | $681,828 | $687,528 | |||||||
| LIABILITIES | |||||||||
| 9 | Joint | Mortgage to (omitted) Bank | $353,891 | $353,891 | |||||
| 10 | Joint | (omitted) Personal Loan | $7,900 | $7,400 | |||||
| 11 | Joint | (omitted) Credit Line | $5,500 | $5,500 | |||||
| 12 | Wife | (omitted) MasterCard | $4,400 | $4,400 | |||||
| 13 | Husband | (omitted) MasterCard | $12,600 | $12,600.93 | |||||
| 14 | Husband | (omitted) Bank Visa | $13,833.88 | ||||||
| 15 | Husband | (omitted) Bank Visa (omitted) | $11,185.58 | ||||||
| 16 | Husband | (omitted) Bank Visa (omitted) | $5,074.34 | ||||||
| 17 | Husband | Loans from (omitted) Bank | $25,935.27 | ||||||
| 18 | Husband | Mr T & brother in law debt | $37,500 | ||||||
| 19 | Husband | (omitted) Bank Loan (omitted) | $13,342 | $13,342 | |||||
| Total | $397,633 | $490,663 | |||||||
| Net non super assets | $284,195 | $196,865 | |||||||
| SUPERANNUATION | |||||||||
| Member | Name of Fund | Type of Interest | Wife’s Value | Husband’s Value | |||||
| 21 | Ms Hosey | (omitted) | $84,000 | $84,709.07 | |||||
| 22 | Mr Hosey | (omitted) | $94,299.64 | $94,299.64 | |||||
The wife did not include any amount for household contents in her balance sheet. The husband contended, based upon the parties’ respective amounts for household contents and referred to in their respective Financial Statements, that $5,000 should be included for the wife and $700 for the husband. Given the modest pool of assets and the absence of any valuation evidence regarding household contents, the court proposes to order that each party will simply retain the household contents in their respective possession and will not include these items in the parties’ list of assets and liabilities.
The wife’s figure for the (omitted) Personal Loan of $7,900, as referred to in her current Financial Statement, is relied upon by the husband in his written submissions (albeit incorrectly stated as $7,400). The figure of $7,900 will go into the parties’ list of assets and liabilities.
The husband’s (omitted) Bank personal loan ((omitted)) had a balance of $25,326 as at 16 May 2010 (bank statement, exhibit J, tag 1; exhibit K). The wife, in her written submissions, contends that this debt should be taken into account in the asset pool as existing at separation. The parties now agree that the current balance of that (omitted) Bank personal loan ((omitted)) is $13,342 (rounded up). The figure of $13,342 will go into the parties’ list of assets and liabilities.
The (omitted) Bank MasterCard account debt as at 24 September 2014 was about $12,600; the wife concedes that the amount of $12,600 should be taken into account in the asset pool as existing at separation and should be added as a loan to the balance sheet. The amount of $12,600 shall be placed in the parties’ list of assets and liabilities accordingly.
The (omitted) Bank Visa Card ((omitted)) debt of $13,833.88, the (omitted) Bank Loan ((omitted) and (omitted)) debts of $25,935.27, and the (omitted) Bank Visa Cards ((omitted) and (omitted)) debts of $16,259.92 were accrued by the husband after separation in May 2010. They did not relate to making payments on the existing debts accrued during the marriage, nor did they relate to assistance given to the wife with repaying the mortgage on the property, her rental expenses, household expenses or personal expenses. These debts do not relate to the relationship and they will not be included in the parties’ list of assets and liabilities. In this context, the court notes the husband’s overseas trips since separation in May 2010 which were paid by the husband on his credit cards.
As to the husband’s alleged debts of some $37,500 owing to Mr T and his brother in law, as discussed previously, the court is not satisfied that these debts exist. The amount will not be included in the parties’ list of assets and liabilities.
As discussed previously, in relation to the husband’s overseas trips after the separation, the court is not satisfied that other persons reimbursed the husband for any part of the cost of those trips. The husband paid for the cost of those trips himself through his loans or credit cards.
Thus the court finds the assets and liabilities of the parties to be:
ASSETS
The Property
$650,000
Wife’s Car
$2,000
Husband’s Car
$4,000
(omitted) Insurance payout
$25,828
Total Assets
$681,828
LIABILITIES
Mortgage Loan to (omitted) Bank
$353,891
(omitted) Personal Loan
$7,900
(omitted) Credit Line
$5,500
(omitted) MasterCard
$4,400
(omitted) MasterCard
$12,600
(omitted) Bank Personal Loan
$13,342
Total Liabilities
$397,633
Net Assets
$284,195
The court finds the parties net assets, excluding superannuation, to be $284,195.
The wife’s superannuation balance, according to exhibit Q of the wife’s affidavit of 24 February 2015, is $84,709.07. The court will treat that amount (rounded down) as representing the wife’s current superannuation entitlement.
The parties’ superannuation entitlements are:
·Wife: $84,709
·Husband: $94,300 (rounded up)
·Neither party asks for a splitting order. The parties’ superannuation entitlements will be discussed later in these reasons.
Section 79 (2) of the Act
The court is satisfied that it is appropriate in this case to alter the property interests of the parties in light of the breakdown of their marriage, the fact that they will no longer have the joint use and enjoyment of the property, and that the continuance of the current legal ownership of the property would not afford them justice and equity. The parties join in seeking orders for property adjustment.
Contributions
The parties’ relationship was for some 6 years.
The wife’s initial contribution relating to the property is important and should be given substantial weight. In 1997 she had purchased the property for $187,000 with a mortgage loan of $50,000. At the commencement of the parties’ cohabitation the property had increased in value to $400,000 less a mortgage of $212,000. The parties used the equity in the property as a vehicle to borrow further monies to fund their lifestyle, noting that the mortgage on the property had increased to about $400,000 by May 2009. The agreed present mortgage balance owing is about $353,891.
The wife worked very long hours in paid employment (two different employers) during the relationship. Her income, during the relationship, was used to pay the considerable household related expenses. The husband’s full time work hours were considerably less. His income during the first four years of the marriage was usually higher than the wife’s income and was used to make the mortgage repayments on the property.
The husband personally carried out some repair and renovation work to the property in 2004 in 2005, both internally and externally. In relation to the husband’s installation of one of two garden sheds and the aviaries, the expert valuation (exhibit F), relating to the value ascribed to the “Lawn locker/aviary area” (which the court assumes is a reference to the two garden sheds, only one of which the husband erected) applies a discrete value of $14,700 (subject to depreciation of 33%) leaving $9,849. It is apparent that this installation work only made a very modest contribution to the property’s overall present value. The court has taken into account the husband’s personal repair and renovation work, including the above installations, but is not satisfied that these contributions should result in a significant weighting of contributions in the husband’s favour.
The court also notes that the parties engaged third parties to install a rear carport/entertainment awning. The expert valuation (exhibit F) of the “Carport/Entertainment awning” applies a discrete value of $38,250 (subject to depreciation of 33%) leaving $25,627. It was the parties’ joint borrowings, utilising the available equity in the property, which allowed this installation to occur. The incomes of both parties were utilised in paying the mortgage (the husband) or household expenses (the wife). In these circumstances, the court cannot be satisfied that one party made a greater contribution than the other in relation to this particular installation and there should not be a weighting of contribution in favour of the husband in this respect.
During the relationship both parties worked in paid employment. The wife’s working hours were substantially longer than the husband’s, even though her income was less than the husband’s during the first four years of the marriage. Both parties carried out the domestic duties including cooking, washing and cleaning. The husband did somewhat more of these duties.
The court notes that the husband travelled to (country omitted) on his own in (omitted) 2009 and (omitted) 2010, being absent for a total of 55 days.
The wife, after the separation in May 2010, made the mortgage repayments on the property. The court also notes she paid some $15,000 from her superannuation to apply towards the mortgage repayments. The court notes that the wife has had the use of the property since separation. The court has taken into account the wife’s post-separation repayments on the (omitted) loan and (omitted) credit card loan.
It is contended on behalf of the wife that her equity in the property, at the commencement of the relationship, was utilised to support the way of life adopted by the parties after the marriage. The wife contends that the court should find that the husband did not contribute to the acquisition, maintenance or improvement of the home in the period of the cohabitation, as they received accommodation and all improvements were funded by the mortgage, as was the lifestyle of the parties in part funded by the increasing mortgage as well as their earnings. The wife contended that the court would determine that the contributions by the wife remained 100% at trial. Whilst the court accepts that the wife’s equity in the property enabled the parties to fund their lifestyle, including renovation work to the property, the court rejects the wife’s submission that her contributions remained 100% at trial.
The husband submitted that the appropriate property adjustment between the parties, taking into account the financial and non-financial contributions, the respective finances and liabilities of the parties, should be 60% in favour of the wife and 40% to the husband. The court is of the view that this submission represents an overly optimistic approach by the husband. This submission does not give sufficient credit to the wife’s initial contribution and post separation contributions spanning a period of about five years, a period approaching the length of the marriage.
The husband made a financial contribution to the reduction of the (omitted) Bank personal loan debt from $25,326 to $13,342. He made a financial contribution to the reduction of the (omitted) Bank MasterCard debt from $19,547 to $12,600.
After considering the evidence, the relevant contributions of the parties are:
a)The wife made a significant financial contribution at the commencement the relationship through her interest in the property.
b)During the relationship the wife worked very long hours in two jobs and utilised her wages to pay for household expenses, whilst the husband worked less hours in his job and used his wage to pay the mortgage. The husband’s wage income during the first four years of the marriage was higher than the wife’s wage income. Both parties contributed to domestic duties; the husband’s contribution in this respect was somewhat greater than the wife’s yet this facilitated the wife’s longer work hours. The court finds that overall the contributions in the above respects should be considered equal.
c)The husband expended his own labour improving the property by erecting a garden shed and aviaries, and he also carried out some repair and maintenance work.
d)The wife made significant financial contributions post separation (for some 5 years) both to the mortgage and to repayment of joint debts, noting that she continued to work two jobs.
e)The husband made a financial contribution to the reduction of the (omitted) Bank personal loan debt (from $25,326 to $13,342) and to the reduction of the (omitted) MasterCard debt (from $19,547 to $12,600) but these contributions were significantly less than the wife’s post separation financial contributions, noting the husband’s overseas travels during this period.
The view of the court is that overall contributions should favour the wife 85% to the husband’s 15%.
Section 75 (2) factors
The wife is aged 55 years and the husband 52 years. They both have remunerative employment. The wife’s current weekly income is about $1,600 per week gross in her two jobs. Her weekly expenditure, amounts to some $1,750.
The wife receives financial assistance from her daughter X of about $300 per week to pay household bills. Her sister brings groceries to her at least weekly, and gives her about $30 per week which she uses to pay for petrol. Her son recently paid a mobile phone bill of $140. She also received assistance from these family members if she has extra bills to pay, such as parking fines.
The husband earns $1,350 gross per week. His weekly personal expenditure is some $1,636, which includes repayment obligations for the personal loans and credit card debts in his name. The husband has weekly rental obligations of $330. The wife continues to live in the property and pays the mortgage.
The husband states that he has a heart condition, diabetes, high blood pressure, shortness of breath, a hernia, and problems with his feet and ankles. He adduced no medical evidence. He works as a security officer.
The wife states that during the marriage she developed rheumatoid arthritis and depression and sought treatment for both conditions. She states that she still suffers from shooting pains in her wrists and pains in her joints. She states that as she had to increase her working hours throughout the marriage, her rheumatoid pain worsened.
There is a brief report from a psychologist dated 22 June 2010 referring to the wife’s commencement of counselling for major depression and a long history of emotional disturbance.
The wife did adduce medical evidence through a very brief medical report from her general practitioner dated 3 March 2015. The report states that the wife “is suffering from multiple medical conditions” being: pelvic inflammatory disease (2002), iron deficiency, migraine, vertigo (2002), sinusitis (2005), overweight, urticaria, rheumatoid arthritis, lumbosacral pain (2005), basal cell carcinoma (2008), lumbar discopathy (sic discopathy) (2010), depression (2010), bilateral knee osteoarthrosis (2010), depression (2010).
The above medical report does not elaborate on the wife’s medical conditions in any way nor does it indicate how the above conditions might impact upon the wife’s work as a (occupation omitted). The wife has continued to work substantial hours in her two employments.
The husband supported the wife’s children during the relationship, in particular Z.
In consideration of the above matters, the court is not satisfied that there should be any adjustment pursuant to section 75(2) of the Act.
Justice and equity
The wife submitted that the just outcome would be to allow the wife to retain the property, with the husband transferring the property to her name, and for the husband to be paid the insurance payout in return for the wife’s indemnity as to the pre-separation borrowings. Further, that the wife would retain her superannuation, car, and household contents.
The husband seeks orders that:
a)the wife pay to the husband $150,000
b)the wife assign to the husband the (omitted) insurance payment: $25,828
c)the husband to retain his car and furniture: $4,700
d)the husband to retain his superannuation: $94,299
e)the husband to retain all debt in his name: about $121,630 (this includes the husband’s alleged loan debt to Mr T and his brother in law of $37,500 which sum the court has not included in the parties’ list of assets and liabilities)
The net property pool is $284,195 (which excludes the parties’ superannuation entitlements and the parties’ household contents). The wife should receive 85% of the net asset pool being $241,566.
On the basis that the wife retains the property, $650,000, her car, $2,000, and retain debts being the mortgage, $353,891, the (omitted) Loans $13,400, her (omitted) MasterCard debt, $4,400, her net position would be $280,309. Because her 85% share of the net asset pool is only $241,566, she should be ordered to pay the husband the difference, being $38,743.
The court’s proposed orders should not affect the earning capacity of the parties.
The court will order that each party retain their own superannuation interest. Given that both parties had superannuation before the marriage, they were earning income during the marriage and making regular superannuation contributions, the present superannuation interests of the parties are comparable, and noting the marriage was not of long duration, the court is satisfied that there should be no adjustment to the parties’ superannuation interests.
In the circumstances of this case, and for all the reasons set out above, the court considers that the orders proposed to be made will produce a just and equitable result as between the parties.
I certify that the preceding one hundred and three (103) paragraphs are a true copy of the reasons for judgment of Judge Newbrun
Associate:
Date: 15 September 2015
Exhibit B – Travel records of the husband.
Exhibit C – 2 photos
Exhibit D – (omitted) Account Statement 31/5/10
Exhibit E – (omitted) Account Statement 23/7/10
Exhibit F – Valuation Affidavit sworn 11/3/15, unsealed
Exhibit G – Balance Sheet of both parties
Exhibit H – (omitted) Bank orange tagged pages
Exhibit I – (omitted) Bank MasterCard Statements
Exhibit J – (omitted) Bank documents
Exhibit K – (omitted) Bank Statement (Husband)
Exhibit L – (omitted) MasterCard Statement
Exhibit M – (omitted) Bank husband current debt.
Key Legal Topics
Areas of Law
-
Family Law
-
Property Law
-
Equity & Trusts
Legal Concepts
-
Remedies
-
Costs
-
Injunction
-
Jurisdiction
-
Procedural Fairness
0
0
2