Hughes v Egger
[2005] NSWSC 18
•4 February 2005
CITATION: Hughes v Egger [2005] NSWSC 18
This decision has been amended. Please see the end of the judgment for a list of the amendments.HEARING DATE(S): 19/07/04 - 30/07/04
JUDGMENT DATE :
4 February 2005JUDGMENT OF: White J
DECISION: Direct the plaintiff's counsel to bring in short minutes of order in accordance with the reasons of the judgment.
CATCHWORDS: De facto relationships - statutory power to make orders adjusting property interests of the parties - Matters to be considered in making adjustments - Parties making different contributions to acquisition of assets - Pre and post-relationship contributions - Assessment of financial and non-financial contributions - Determination of parties' beneficial interests in property under resulting trust - Relevance of incidence of domestic violence.
LEGISLATION CITED: Property (Relationships) Act 1984 (NSW)
Property (Relationships) Legislation Amendment Act 1999
De Facto Relationships Act 1984CASES CITED: Sullman v Sullman (2002) DFC 95-248
Jones v Grech (2001) 27 Fam LR 711
McDonald v Stelzer (2000) 27 Fam LR 304
Evans v Marmont (1997) 42 NSWLR 70
Roy v Sturgeon (1986) 11 NSWLR 454
Foster v Evans (1997) DFC 95-193
Green v Robinson (1995) 36 NSWLR 96
Nguyen v Schieff (2002) DFC 95-246
D v McA (1986) 11 Fam LR 214
Watson v Foxman (1995) 49 NSWLR 315
Calverley v Green (1984) 155 CLR 242
Ryan v Dries (2002) 10 BPR 19,947; [2002] NSWCA 3
Biviano v Natoli & Ors (1998) 43 NSWLR 695
Currie v Hamilton [1984] 1 NSWLR 687
Block v Block (1981) 180 CLR 390
Jacobs' Law of Trusts in Australia, 6 ed para 1211
Jackson v Jackson [2000] NSWCA 303
Killick v Killick (1997) DFC 95-180
Kennon v Kennon (1997) 22 Fam LR 1
Dwyer v Kaljo (1987) 11 Fam LR 785
Davey v Lee (1990) 13 Fam LR 688
Powell v Supresencia (2003) 30 Fam LR 463; [2003] NSWCA 195
Mallet v Mallet (1984) 156 CLR 605PARTIES: Desmond Barry Hughes
v
Sandra June EggerFILE NUMBER(S): SC 3618/01
COUNSEL: Plaintiff: G Richardson SC, M Kearney
Defendant: C M SimpsonSOLICITORS: Plaintiff: Broun Abrahams
Defendant: John de Mestre & Co, Solicitors
LOWER COURT JURISDICTION:
IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
WHITE J
Friday, 4 February 2004
3618/01 DESMOND BARRY HUGHES v SANDRA JUNE EGGER
JUDGMENT
1 HIS HONOUR: The plaintiff and the defendant were parties to a de facto relationship which terminated in September 1999. They have each applied for orders under subs 20(1) of the Property (Relationships) Act 1984 (NSW) adjusting their interests with respect to their property.
2 Subsection 20(1) of the Act provides:
- 20 Application for adjustment
- (1) On an application by a party to a domestic relationship for an order under this Part to adjust interests with respect to the property of the parties to the relationship or either of them, a court may make such order adjusting the interests of the parties in the property as to it seems just and equitable having regard to:
- (a) the financial and non-financial contributions made directly or indirectly by or on behalf of the parties to the relationship to the acquisition, conservation or improvement of any of the property of the parties or either of them or to the financial resources of the parties or either of them, and
- (b) the contributions, including any contributions made in the capacity of homemaker or parent, made by either of the parties to the relationship to the welfare of the other party to the relationship or to the welfare of the family constituted by the parties and one or more of the following, namely:
- (i) a child of the parties
(ii) a child accepted by the parties or either of them into the household of the parties, whether or not the child is a child of either of the parties.
3 The defendant also contends that in April 1996 the parties reached an agreement that if their relationship did not work out, they would share equally any property they acquired during their relationship and any increase in the value of property held by either of them at the commencement of the relationship. The plaintiff denies that such an agreement was made. It was not in writing, and, if made, could not be effective to exclude the Court’s jurisdiction under s 20 of the Act. (ss 47(1) and 48). However the defendant relies upon the alleged agreement in two ways. First, as creating rights at general law which define the interests of the parties in the property held by each of them in respect of which any adjusting order might be made. Secondly, as being material to what order adjusting the proprietary interests of the parties is just and equitable having regard to the matters in sub-paragraphs (a) and (b) of subs 20(1).
When Did the De Facto Relationship Commence?
4 The defendant contended that from May 1988 the parties entered into a de facto relationship. The plaintiff denied this and contended that such a relationship did not commence until July 1991. There was a great deal of evidence adduced on the question whether a de facto relationship commenced prior to July 1991. It was common ground that there was a de facto relationship between the parties after that date which continued until 7 September 1999. As that relationship continued after the commencement on 28 June 1999 of the Property (Relationships) Legislation Amendment Act 1999, the question of whether a de facto relationship commenced in May 1988, or did not commence until July 1991, is to be determined by the definitions now contained in the Property (Relationships) Act 1984, rather than those contained in the then De Facto Relationships Act 1984 prior to its amendment in 1999. (Sullman v Sullman (2002) DFC 95-248 at [47].) In my view the question of when the de facto relationship commenced is not of particular significance, as it is now firmly established that contributions made by either party to a de facto relationship prior to the commencement of that relationship should be taken into account if they are of a kind described in s 20(1)(a) or (b). (Jones v Grech (2001) 27 Fam LR 711 at 721, 731-732). Nor, is it necessary to decide that question when dealing with the defendant’s claim that in 1996 the parties agreed upon a method of division of their pre and post relationship assets. The parties were undoubtedly in a relationship of some kind from May 1988, even if it lacked the closeness and permanence of a de facto relationship.
5 However the issue has been raised and should be determined, if only because it is not clear on the authorities whether the same weight can be given to contributions made before the commencement of the de facto relationship, as to those made after its commencement. In McDonald v Stelzer (2000) 27 Fam LR 304 Priestley JA (at [39]) considered that pre-relationship contributions could be given some weight, but not fundamental weight, in considering what adjustment, if any, is just and equitable having regard to the contributions falling within subs 20(1)(a) and (b), on the same principles as those on which other matters relevant to the nature and incidents of a relationship as a whole may bear upon what adjustment is just and equitable having regard to the contributions of the kinds referred to in paras (a) and (b), as discussed by Gleeson CJ and McLelland CJ in Eq in Evans v Marmont (1997) 42 NSWLR 70 at 74-5. It was implicit in his Honour’s reasoning that pre-relationship contributions did not directly fall within paras (a) and (b) of subs 20(1). In Jones v Grech Davies AJA said (at [25]) that he agreed with the remarks of Priestley JA in McDonald v Stelzer. However his Honour went on to say (at [26]) that the factors specified in s 20 may include actions which have taken place prior to the commencement of the period of the relationship. If such contributions do fall within paragraphs (a) and (b) of subsection (1) there is no reason that they should be relegated to a subsidiary role, merely on account of their preceding the commencement of the relationship. Ipp AJA (as his Honour then was) said (at [82]) that there was no difference in principle between contributions made before the de facto relationship commenced and those made thereafter.
6 The question whether pre-relationship contributions may qualify directly under paragraphs (a) or (b) of subs 20(1), or whether regard may be had to them only as potentially relevant, but subsidiary, factors on a consideration of what adjustment is just and equitable, turns on the proper construction of paragraphs (a) and (b). In Roy v Sturgeon (1986) 11 NSWLR 454 Powell J (as his Honour then was) held (at 464-5) that although s 20 did not expressly limit the contributions to which the Court could have regard to those made only during the course of the de facto relationship, nonetheless, on the proper construction of the section, and consistent with the policy of the Act, the contributions to which regard could be had should be so limited. His Honour adhered to those views in Jones v Grech. However in Foster v Evans (1997) DFC 95-193 at 77,681 Bryson J disagreed with this view and the majority of the Court of Appeal departed from it in Jones v Grech. There is no express requirement that contributions under s 20(1)(a) or (b) be made during the period of the relationship. For the reasons given by Bryson J in Foster v Evans at 77,681 I am of the respectful view that there is no implied limitation as to the time at which contributions otherwise falling within those paragraphs must be made. I therefore respectfully consider that I ought to follow the opinion of Ipp AJA (as his Honour then was) in Jones v Grech that there is no difference in principle between contributions made before the de facto relationship commenced and those made thereafter.
7 For the same reasons I consider there is no difference in principle between contributions of the kind described in paras (a) and (b) made after the relationship has concluded and those made during its continuance. This point was decided by Bryson J in Foster v Evans (1987) DFC 95-193 at 77,681. It is a logical corollary of Jones v Grech, and is consistent with the view of Cole JA in Green v Robinson (1995) 36 NSWLR 96 at 115-116, cited with approval by Campbell J in Nguyen v Schieff (2002) DFC 95-246 at [105]-[109] and Sullman v Sullman (2002) DFC 95-248 at [247].
8 A de facto relationship within the meaning of the De Facto Relationships Act 1984 before its amendment in 1999 by the Property (Relationships) Legislation Amendment Act 1999 meant a relationship between a man and a woman who lived together as man and wife on a bona fide domestic basis although not married. After that amendment it means a relationship between two adult persons who live together as a couple and are not married to one another or related by family (s 4(1)).
9 A de facto relationship is a “domestic relationship” to which s 20 applies. Also included within the ambit of a domestic relationship is a close personal relationship (other than a marriage or a de facto relationship) between two adult persons who are living together, one or each of whom provides the other with domestic support and personal care. The defendant’s claim was that the parties were in a domestic relationship from about May 1988 constituted by a de facto relationship. She did not claim that there was a domestic relationship constituted by a close personal relationship within the meaning of the Act.
10 Subsection 4(2) sets out the matters to be considered in determining whether there was a de facto relationship between the parties. These factors were drawn from the judgment of Powell J (as his Honour then was) in D v McA (1986) 11 Fam LR 214, 227 which were thereafter frequently applied. (e.g Roy v Sturgeon (1986) 11 NSWLR 454 at 458-459). Subsection 4(2) provides:
4 De facto relationships
(2) In determining whether two persons are in a de facto relationship, all the circumstances of the relationship are to be taken into account, including such of the following matters as may be relevant in a particular case:
(a) the duration of the relationship,
(b) the nature and extent of common residence,
(c) whether or not a sexual relationship exists,(g) the care and support of children,
(d) the degree of financial dependence or interdependence, and any arrangements for financial support, between the parties,
(e) the ownership, use and acquisition of property,
(f) the degree of mutual commitment to a shared life,
(h) the performance of household duties,
(i) the reputation and public aspects of the relationship
11 Since the 1999 amendments those criteria are to be used to determine whether two adult persons, whether of the same or opposite sex, “live together as a couple”. It appears from the Second Reading Speech that the re-definition of de facto relationship was designed to include those living together as homosexual couples. So far as heterosexual couples are concerned, it does not appear from the Second Reading Speech that the changes to the definition of a de facto relationship were intended to make a substantive change to the then existing law.
12 I shall consider whether a de facto relationship existed from May 1988 by reference to each of the paragraphs in subs 4(2).
(a) The Duration of the Relationship.
13 The “relationship” referred to in paragraph 4(2)(a) refers to something looser than the de facto relationship (Sullman v Sullman at [194]). It is a criterion to be used in determining whether a de facto relationship exists. It is not of assistance in determining when the admitted de facto relationship commenced.
(b) The Nature and Extent of Common Residence
14 The plaintiff and the defendant met in 1987. The plaintiff was then a Professor of Economics at the University of Newcastle. He was then aged 45. The defendant was then employed as an adviser on the staff of the then NSW Premier, Mr Unsworth. She was then aged 40. The plaintiff was then living by himself at a property at 140 Sealand Road, Fishing Point on Lake Macquarie. The defendant lived at 8 Jenner Street, Seaforth. At that time she had separated from her husband, but was not divorced. She lived with her son Samuel, then aged 17. A Mr Piggott, who was a family friend, also lived on the property in a freestanding room in the back garden. At that time the property at 8 Jenner Street, Seaforth was jointly owned by the defendant and her husband.
15 The parties commenced a sexual relationship in March 1988. Up to March 1988 the plaintiff was a consultant to both the NSW Premier and the Commonwealth Treasurer, as well as holding the chair in Economics at the University of Newcastle. He was by profession a macro-economist and a labour economist. The consultancies which he then held terminated at or about 19 March 1988. This left the plaintiff free to accept other consultancies to the financial markets, although he was constrained by the terms of his employment with the University of Newcastle from spending more than a day per week on such consultancies. Shortly after 19 March 1988 he accepted a consultancy with Credit Suisse First Boston, then called First Boston Australia. He also did some consultancy work for Westpac in Sydney and some consultancy work for the Australian Finance Association also in Sydney.
16 The defendant in March 1988 was employed as a special legal policy adviser on the staff of the then NSW Premier, Mr Unsworth. She held a doctorate in psychology and a degree in law. The NSW Labour Government was defeated in March 1988 as a result of which the defendant ceased to be employed in her then position as policy adviser to the Premier. She took up employment with the NSW Law Reform Commission. In 1989 she took up part-time lectureships in law at the University of NSW and Macquarie University. From 1990 she was employed as a senior lecturer in law at the University of NSW.
17 In April 1988 the parties spent a week on holiday in South Australia staying at a house which the plaintiff owned in Hindmarsh in that state.
18 From late May 1988, when the plaintiff was in Sydney, which was frequently, he stayed with the defendant at her house at 8 Jenner Street, Seaforth. He moved some of his clothes and toiletries into a wardrobe in the defendant’s bedroom and shared the defendant’s bed. The plaintiff denied having left business suits or like clothing in the defendant’s house at this time, but I prefer the defendant’s evidence on this topic which was corroborated by her son Samuel. Given the frequency of the plaintiff’s visits to Sydney, to which I will refer below, it made sense for him to have moved some of his clothing into the defendant’s house.
19 Except when the plaintiff was interstate or overseas, from May 1988 until July 1991, the regular pattern of residence was that the parties spent each weekend either at the plaintiff’s property at Fishing Point on the western shores of Lake Macquarie, or at the defendant’s house in Seaforth. Usually this entailed overnight stays on the Friday and Saturday nights and often, when the plaintiff visited Sydney, an overnight stay by the plaintiff on the Sunday night, after which he returned to Newcastle on Monday morning.
20 The defendant claimed that on average the plaintiff also spent two days, that is one night, per week in Sydney during this period. The plaintiff attended to his consultancy work for clients in Sydney. He accepted that he did stay from time to time with the defendant at her house in Seaforth during mid-week periods, but estimated that the amount of such time was about ten per cent of such mid-week visits, that is about once a fortnight. This would seem to be a relatively narrow area of dispute. However a great deal of time and effort was spent on it. The parties analysed such records as were available to try to establish the frequency and length of the plaintiff’s stays in Sydney. This included analysing motor vehicle log books or records of travel claims and expenses to establish the frequency and length of travel of the plaintiff between Lake Macquarie and Sydney; analysing cash withdrawals from ATM machines and credit card transactions to seek to locate the plaintiff in either the Sydney or the Newcastle area; comparing telephone records for the Fishing Point property for the periods preceding and succeeding July 1991; and analysing records of water use at the Fishing Point property before, during and after the period from May 1988 to July 1991. None of this evidence was conclusive. Little of it was helpful.
21 The principal basis upon which the plaintiff denied the defendant’s contention as to the frequency and length of visits to Sydney was that from June 1988 until June 1991 he was head of the Department of Economics at the University of Newcastle, as well as being a professor with teaching responsibilities and a member of the University Senate Research Committee. He said that these duties precluded more frequent visits to Sydney, at least during the University term. He agreed however that there were quite a number of weeks when he spent a mid-week night in Sydney.
22 For the period 1989 to 1990 the defendant tendered a handwritten record prepared by the plaintiff recording the payment of Harbour Bridge tolls on seventy-two occasions during the periods from 17 July to 25 November 1989 and, it seems, between May and June 1990. Many of the records were for consecutive days during the week which would be consistent with the plaintiff then staying at the Seaforth property for a number of days together and crossing the harbour into the city for work purposes.
23 However, the evidence simply does not permit of a definitive conclusion as to the amount of time between May 1988 and July 1991 each spent at the house of the other. Nor is it necessary to attempt to reach a precise conclusion on the balance of probabilities. It suffices to conclude, as I do, that leaving aside the period of the summer holidays, the parties spent most weekends together, often alternating between their respective houses. I accept that more weekends were spent in Sydney than at Fishing Point, if only because the plaintiff had occasions to spend the next or the preceding business day in Sydney for work purposes. In addition, on average, the plaintiff spent between one night per week and one night per fortnight at the defendant’s Seaforth property.
24 When the plaintiff stayed with the defendant, she continued to carry out the cleaning, washing and ironing for the household of herself and her son. She also washed and ironed for the plaintiff. She continued to clean the house. They did some shopping together. The plaintiff made no contribution to the purchase of food and other household items. He did not contribute to outgoings of the Seaforth property, nor to new furnishings for that property which the defendant purchased. The defendant prepared the meals. On Sundays the defendant often did work in the garden. The plaintiff usually read newspapers, watched TV or worked in the study. He rarely, during this period, assisted around the house or in the garden.
25 However I do not regard these matters as a strong pointer against the existence of a de facto relationship. They were characteristic of how the parties conducted themselves after July 1991, when there is no issue that a de facto relationship existed.
26 When the defendant stayed with the plaintiff at the Fishing Point property the plaintiff, initially at least, paid for the groceries, although later the defendant did the bulk of the shopping on Saturday mornings and paid for groceries. She also did the laundry at the Fishing Point property and attempted to clean the property. She had more stringent housekeeping standards than did the plaintiff and endeavoured to apply them to his property as well as hers. The defendant did not contribute to any of the outgoings on the Fishing Point property. The same however is true for the period after July 1991.
(c) Whether or not a Sexual Relationship Exists
27 A sexual relationship existed at the commencement of the period and I infer that it continued throughout the period.
(d) The Degree of Financial Dependence or Interdependence and any Arrangements for Financial Support Between the Parties
28 Throughout the period the parties earned separate incomes. They owned separate property. They had no joint bank account. Neither was financially dependent on the other. However there was a degree of financial interdependence through a company whose shares they acquired on 4 July 1988 and in which, in later years, there was some pooling of consulting income. The company acquired motor vehicles which were used by the plaintiff and the defendant. The company was called Indecs Llwynog Pty Ltd.
29 Indecs Llwynog was established as a shelf company and was acquired for the plaintiff on 4 July 1988. The plaintiff and the defendant were the only shareholders. They each held one share. They were also the directors. The defendant was a shareholder because of the then requirement that a company needed at least two shareholders if the shareholders were individuals. The plaintiff was advised that the shareholding could be left as it was, or the defendant could execute a declaration of trust in favour of the plaintiff or his nominee, or she could transfer her share to a nominee nominated by the plaintiff. The plaintiff said that the situation was left unchanged due to a combination of inertia, an expectation that the parties would contribute equally to the company, and the small extent of business then being undertaken. The company was acquired to be a tax effective vehicle through which to channel the parties’ consulting income. The plaintiff also regarded it as an easier way of obtaining maximum tax advantages in relation to the use of motor vehicles. Although the defendant never executed a formal declaration of trust, in her oral evidence she said that at no time did she consider that she owned the share for her own benefit. She said that she told the plaintiff that “I’ll hold the share for you”. In a statement of financial circumstances sworn in the Family Court on 26 October 1989 the defendant stated that she held the share on trust for the plaintiff.
30 In the financial years ended 30 June 1989 and 30 June 1990 Indecs Llwynog derived income from the consulting activities of the plaintiff in the amounts of $45,575 and $53,122 respectively. It also earned interest on these monies. It paid or credited the plaintiff with a salary of $9,006 in the year ended 30 June 1989 and $7,360 in the year ended 30 June 1990. In the year ended 30 June 1991 it earned income from consulting work and royalties attributable to the efforts of the plaintiff for $57,602. It also derived income of $17,000 from consulting work carried out by the defendant. This was work which the defendant did for the Commonwealth Office of the Status of Women and for Australian Nationwide Opinion Polls. In the year ended 30 June 1991 the plaintiff was paid or credited with a salary of $7,680. The defendant was paid or credited with a salary of $5,000.
31 From May 1990 the defendant had the use of a company owned Hyundai Excel motor vehicle which was replaced in April 1991 by a company owned Nissan Pulsar sedan. Some of the costs of running the motor vehicles were met by the company. The plaintiff used a Mazda motor vehicle purchased by the company in about May 1990.
32 There was therefore from 1990 a degree of financial interdependence between the parties through their use of Indecs Llwynog as a vehicle to which to direct income which they otherwise would have earned personally, and from which they drew or were credited with salaries, and whose motor vehicles they used. Up to 30 June 1991 both the plaintiff and the defendant put more into the company than they drew from it. The appointment of the defendant as a director of the company in July 1988, and the transfer of a share to her without any written declaration of trust, are actions which indicate that the parties had a mutual trust in each other and in the future of their relationship, which is consistent with there then being a de facto relationship between them. Given that the defendant disclaimed any beneficial interest in the shares in the company, her directing her consultancy income to the company in 1991 is indicative of a degree of trust in the plaintiff and the future of their relationship which is consistent with there then being a de facto relationship between the parties.
33 Up to 30 June 1991 the defendant paid for food, groceries and other consumables for the benefit of the plaintiff although the extent of that contribution cannot be identified. I would not characterise such expenditure as the provision of “financial support”.
(e) The Ownership, Use and Acquisition of Property
34 Apart from the acquisition of shares in Indecs Llwynog and the use of motor vehicles owned by that company, and apart also from the use by each party of the other’s house, there was no material change to the parties’ ownership, use or acquisition of property during this period until July 1991. As at May 1988 the plaintiff had the following investments in real property:
(a) he owned a property at 140 Sealand Road, Fishing Point which he had acquired in June 1987 for $80,000.
(b) he owned a property at 7 Bowillia Avenue, Hawthorn, South Australia, which had been purchased in December 1969 for $15,000 and which had been improved by the addition of a second storey in 1983. The property was rented.
(c) he owned a property at 9 Batson Pde, Hindmarsh Island, South Australia which had been purchased in 1975 for $24,000 and had been improved by the addition of a second storey in 1980. This property was also rented. Both the properties at Hawthorne and Hindmarsh Island were subject to mortgages apparently taken out when the properties were acquired. The mortgages had been paid off, but had not been discharged.
(e) he held a 25% interest in a warehouse at 153-157 William Street, Beverley, South Australia acquired in November 1986 for $154,500. It was subject to a mortgage to a company (the previous owner) which he had guaranteed, where his share of the liability was $125,000.(d) he owned a block of investment flats at 32 Bussell Road, Wembley Downs, Western Australia. It was subject to a mortgage as at 15 March 1988 to Bisley Mortgage Corporation of $185,000.
35 The properties at 7 Bowillia Avenue, Hawthorne and 153-157 William Street, Beverley were also mortgaged to Standard Chartered Bank. The liability to Standard Chartered Bank as at 26 February 1988 was £36,526 or $90,500 at the then exchange rate.
36 In November 1990 the plaintiff acquired a 50% interest in 73 Sealand Road, Fishing Point for $40,000.
37 The plaintiff also had liabilities of $10,000 to the Flinders Credit Union and $10,305 to the ANZ Bank referable to his interest in the properties at 7 Bowillia Avenue, Hawthorne and 153-157 William Street, Beverley respectively.
38 In addition to these items of real property the plaintiff had an interest in a partnership called the Indecs Economics Partnership. This was a partnership of five South Australian economists who published independent economic surveys of the Australian economy. However so far as the evidence discloses this did not have any value as at May 1988. He was also a shareholder in Indecs Holdings Pty Ltd, having 27.5% of the shares in that company. That company owned a factory in Adelaide subject to a mortgage and received consulting income. The company later went into liquidation and there is no evidence that the shares had any value at the time.
39 The plaintiff had three bank accounts with credit balances totalling $10,465. He also had superannuation entitlements with the Macquarie Bank Personal Approved Deposit Fund ($188,689); the AMP Superannuation Fund ($30,136) and the University of Newcastle Professorial Staff Scheme ($11,003).
40 Finally he possessed certain furniture and household goods.
41 The defendant, as at May 1988, owned the property at 8 Jenner Street, Seaforth as joint tenant with her then husband. The property was valued in 1991 at $350,000. The property was subject to a mortgage of $46,000.
42 The defendant owned a Datsun Pulsar motor vehicle which was sold in May 1991 for $2,125.
43 The defendant had savings of $8,000. She also held half of the shares in a company called Centre For Health Promotion and Research Pty Ltd. In her submissions the defendant attributed a value of $148,000 to those shares. The evidence does not establish that the shares had that value. They were in any event later transferred by her to her husband as part of the divorce settlement.
44 The defendant also owned furniture. She had an entitlement to long service leave valued at $7,835 and an accrued redundancy entitlement worth $20,490. She also had a superannuation account with the State Authority Superannuation Board with a value of $65,155.
45 There was no transfer from either party to the other of any interest in any of their assets.
(f) The Degree of Mutual Commitment to a Shared Life
46 The defendant deposed to a conversation occurring on Monday 9 May 1988 immediately after the parties had returned from their holiday in South Australia. After spending the weekend at the plaintiff’s house they travelled to Lake Macquarie and spent the rest of the week there. According to the defendant the plaintiff said that he wanted to be with her always and for them to live as a family. According to her, the defendant said that they could try living together although the plaintiff would have to respect her obligations to her son. The plaintiff denied this conversation. I am not satisfied that it occurred. As McLelland CJ in Eq said in Watson v Foxman (1995) 49 NSWLR 315 at 319, the fallibility of human memory ordinarily increases with the passage of time particularly where disputes or litigation intervene such that processes of memory are overlaid, often subconsciously, by perceptions or self-interest as well as conscious consideration of what should have been said or could have been said.
47 Nonetheless, the parties’ conduct demonstrated quite a high degree of mutual commitment to a shared life. Except where the defendant’s work commitment precluded it, they lived together for the whole of this time, notwithstanding the frequent travel that this entailed. For the reasons I have already explained, the establishment and operation of Indecs Llwynog evidenced some mutual commitment to a shared life. The extent of their commitment was exemplified by events from mid 1991. The plaintiff ceased to be the Head of the Department of Economics in June 1991 and took six months sabbatical leave from the University in July 1991. Knowing that this was to occur, he and the defendant made arrangements from May 1991 for the defendant to acquire another property in Jenner Street, Seaforth (22 Jenner Street), into which they would both move. To assist with the financing of that property it was agreed that the plaintiff would purchase a 30% interest in the property at 8 Jenner Street for $130,000. That degree of commitment did not spring up out of nothing in June 1991. It reflects an existing mutual commitment to a shared life, just as does the conduct of the parties in relation to Indecs Llwynog.
The Care and Support of Children
48 There are no children of the relationship. The defendant lived at home with her son Samuel. Samuel turned 18 in July 1988. The plaintiff maintained fairly friendly relations with Samuel at this time. They played the occasional game of golf together. They watched television together. The plaintiff discussed with Samuel Egger what he should study at University when he finished his HSC. The plaintiff attended a dinner celebration for Samuel Egger’s 18th birthday. There were continuing discussions about university studies for Samuel. Again this evidence is consistent with an existing de facto relationship.
(g) The Performance of Household Duties
49 The defendant performed the household duties. When the plaintiff stayed at the defendant’s house at 8 Jenner Street, she, to use his words, “continued with what I took to be her normal weekend routine”. The plaintiff said that he did do some gardening at 8 Jenner Street at this time, but if he did, it was minimal. When the defendant visited the Fishing Point property she did the washing, and after a time did most of the shopping on the Saturday morning. The plaintiff did some gardening at that property as did the defendant, who also attempted to clean the property. The defendant did the washing up. The defendant’s activities are again consistent with an existing de facto relationship.
(h) The Reputation and Public Aspects of the Relationship
50 The defendant introduced the plaintiff to her friends and acquaintances as “her partner”. He accepted that description. They appeared to their work colleagues and friends to be persons who lived together as a couple. They were invited jointly to the defendant’s friends or colleagues’ places for dinner.
Conclusion on When the De Facto Relationship Commenced
51 Having regard to these matters, I conclude that the parties were in a de facto relationship from about May 1988 notwithstanding that they were only living together for parts of this time. They were only separate because of the plaintiff’s employment at the University of Newcastle. Even so, they spent most weekends and some part of the mid-week period together. They maintained a sexual relationship. In 1990 the plaintiff had an affair with another woman which, as he said, “not surprisingly caused difficulties in the relationship with the defendant”. Although that reaction to the plaintiff’s conduct is not inconsistent with the parties being in a looser relationship, it is consistent with their then being in a de facto relationship. For the reasons I have given they demonstrated a mutual commitment to a shared life. They conducted themselves towards each other and towards third parties as a permanent couple.
52 The plaintiff however relied upon contemporaneous statements by the defendant which were inconsistent with the existence of such a relationship. First, the plaintiff pointed to the fact that in the defendant’s tax returns for the periods to 30 June 1991 she did not disclose the plaintiff as her de facto partner, notwithstanding that the returns required the taxpayer to state the full name of his or her spouse, whether legal or de facto. However I think all that shows is that the defendant did not accurately complete her income tax return in this respect. She was not alone in that. The plaintiff did not identify her as his de facto spouse in his tax returns after 1991, even though in at least three years that information was required.
53 Of greater significance is that in her statement of financial circumstances filed in the Family Court in proceedings against her former husband, the defendant was required to state the income of members of her household. She identified as members of her household, her son and Mr Piggott who, it will be recalled, was a boarder. Her statement of financial circumstances was sworn on 26 October 1989. She gave evidence before me that at this time she regarded the plaintiff as being a member of her household. She acknowledged that she was wrong not to have referred to the plaintiff. She did not seek to make any distinction between the plaintiff being her de facto partner and a member of her household. It was submitted by the plaintiff that her statement to the Family Court was accurate. The material filed in the Family Court is certainly some evidence tending against a finding that there was a de facto relationship between the parties in October 1989. However, on balance, for the reasons which I have given, I think there was such a relationship.
54 It follows that even if I am wrong in relation to my earlier conclusion as to the weight to be given to contributions made before the commencement of the relationship of a kind falling within s 20(1)(a) and (b), nonetheless, I should give full weight to the parties’ contributions falling within paragraphs (a) and (b) of subs 20(1) during the period from May 1988 to June 1991.
May 1988 – June 1991 Contributions
55 During this period the balance of contributions to the acquisition of property, and to the welfare of the other party to the relationship favours the defendant. The plaintiff occupied her home more than she occupied his. She provided services as a homemaker. She made a greater financial contribution to his welfare during this period by purchasing food and groceries for his use, than did he for her. It is not however possible to put a figure on that expenditure. The defendant attempted to state her expenditures in the period from May 1988 to June 1991. However not only were the figures which she produced not consistent with the figures in her statement of financial circumstances filed in the Family Court, but there was no break up of the expenditures between those referable to the welfare of the plaintiff, and those referable to the welfare of herself and her son. Records for this period were missing.
56 During this period the defendant contributed more to Indecs Llwynog than the benefits which she derived from Indecs Llwynog. It is true that the plaintiff contributed more to that company than did she, but on what is now the case of both parties (although this did not become evident until well during the hearing), the shares in that company were beneficially owned by him.
Purchase of 22 Jenner Street, Seaforth
57 In February 1990, the defendant settled her proceedings in the Family Court with her former husband. Pursuant to that settlement he transferred his interest in the 8 Jenner Street property to her subject to the existing mortgage. She paid him $27,000 and transferred to him her shares in Health Promotion and Research Pty Ltd.
58 In late May 1991 the parties noticed that the property at 22 Jenner Street, Seaforth was advertised for sale. The defendant purchased the property for $405,000. With stamp duty, legal fees and other costs, the cost of the purchase was $421,168. In order to fund the acquisition, the plaintiff agreed to purchase from the defendant a 30% interest in the property at 8 Jenner Street. The plaintiff says that this was more than a 30% stake in the property was worth. On 23 July 1991 the property at 8 Jenner Street was valued at $350,000 by a valuer who prepared a valuation for the use of Barclays Bank Australia Ltd. The valuer advised that with the satisfactory completion of repairs or renovations at an estimated cost of $2,500 he considered that the property would readily sell for $355,000. The same valuer valued the property at 22 Jenner Street at $385,000 or $20,000 below the selling price, which was itself an arm’s length transaction. The plaintiff offered the sum of $130,000 for a 30% share in 8 Jenner Street after discussion with the defendant as to what would be a fair selling price for the property. In that sense it was an arm’s length transaction. However, a purchase of a 30% interest for $130,000 was below an amount which would represent 30% of the then market value of the property on the only evidence of its market value which was adduced. The payment can properly be regarded as a contribution by the plaintiff to the extent of about $20,000 which indirectly assisted the acquisition by the defendant of the property at 22 Jenner Street.
59 The fact that the plaintiff paid more than the market value for a 30% interest in 8 Jenner Street does not however mean that he acquired a beneficial interest of more than 30% in the property. Nor do the monies which the parties later spent on renovations of the property effect a change to their beneficial interests in it. Such payments, to the extent they differ from the parties’ respective beneficial interests in the property, should be recognised as contributions under paragraph 20(1)(a) to the conservation or improvement of the property of the parties, to be taken into account in considering what adjustment, if any, is just and equitable to the parties’ property interests.
60 The property at 22 Jenner Street was purchased in the name of the defendant only. The plaintiff told the defendant that he wanted it to be in her name for tax reasons. Although the defendant was the sole registered proprietor of the property she did not dispute that the plaintiff was entitled to a beneficial interest in it. The quantum of that interest was not then agreed between the parties. It is to be presumed that the defendant held the legal estate in trust for herself and the plaintiff as tenants in common in shares proportionate to their contributions to the purchase price. (Calverley v Green (1984) 155 CLR 242). The better view is that “the purchase price” includes the aggregate costs of the acquisition including incidental costs, fees and disbursements (Currie v Hamilton [1984] 1 NSWLR 687 at 691; Jacobs’ Law of Trusts in Australia, 6 ed para 1211; Ryan v Dries (2002) 10 BPR 19,947; [2002] NSWCA 3 at [53]).
61 There were slight differences in the parties’ estimates, or assertions, as to the total purchase cost, including incidental costs, of the 22 Jenner Street property. There were also minor differences in their assertions as to how the parties contributed to those costs. The principal differences were in respect of an amount of loan application fees and the rates adjustments on the sale. The latter is not an appropriate adjustment to take into account for the purpose of determining the beneficial interests of the parties in the property. As the loan application fees were paid by the plaintiff I think it more probable that they related to his borrowing of $135,000 to acquire a 30% interest in 8 Jenner Street, rather than to the defendant’s borrowing from the St George Bank of $105,000 to acquire 22 Jenner Street. In any event loan application fees do not represent part of the purchase costs. Accordingly I prefer the defendant’s calculations, although the ultimate difference is minimal. The “purchase price” was $422,385. The defendant borrowed $105,000 and applied $117,898 from the sale of the 30% interest in 8 Jenner Street together with other payments totalling $11,645 from her savings. Those amounts total $234,543. The balance of the purchase price was contributed to by the plaintiff either from monies which he held personally, or from monies he borrowed from Indecs Llwynog. As a result the defendant contributed 55.5% and the plaintiff 44.5% of the purchase costs of 22 Jenner Street.
62 At about the time 22 Jenner Street was purchased and the 30% interest in 8 Jenner Street was transferred, the defendant discharged the existing mortgage over 8 Jenner Street. She did so partly by using monies from her Macquarie ADF account and partly by using the balance of $12,101.64 from the payment which she received for her 30% interest in 8 Jenner Street from the plaintiff. However this is not an additional matter to be taken into account in considering either the parties’ beneficial interests in either property. Nor is it relevant to s 20. The defendant used her own money to discharge her own liability.
Renovations and Repairs to 8 Jenner Street
63 The idea of acquiring 22 Jenner Street was that the plaintiff, the defendant, her son and Mr Piggott would move to 22 Jenner Street and that 8 Jenner Street would be let.
64 After the parties moved into 22 Jenner Street renovations commenced to 8 Jenner Street. A builder was engaged. Mr Piggott assisted with the demolition work. The work to 8 Jenner Street involved the demolition of the back quarter of the house, the pouring of a concrete slab, and the construction of a new kitchen, bathroom and family room. Renovations were also carried out to the ceilings and walls of existing rooms. The exterior of the house was painted and the front lounge-room floor was re-polished. This work took place from about mid September 1991 to December 1991. The cost of the renovation work was asserted by the plaintiff to be $51,358 of which he contributed $39,355 and the defendant the balance. There was a dispute about the details of the claims. The plaintiff’s claimed contributions were not itemised, although the defendant’s were. I accept however, particularly in the absence of a denial, that the plaintiff paid the greater part of the cost of renovations to 8 Jenner Street. I adopt the defendant’s figure for the amount of her contributions to the cost of renovations to 8 Jenner Street and the plaintiff’s figure for the cost of his. On that basis the plaintiff paid $39,355 of total renovation costs of $53,400 or 73.7% of the cost of renovations. This was a contribution of about $23,000 in excess of his beneficial interest in the property, which should be recognised as a contribution to the conservation and improvement of that property for the purposes of s 20(1)(a) adjustments. The defendant’s contribution did not exceed her beneficial interest in the property and is not to be considered as a relevant contribution under s 20(1)(a).
65 Against that however the defendant points out that she continued to pay the whole of the gas, electricity and water costs for 8 Jenner Street during the period that the renovations were being undertaken. However the payment in excess of her beneficial interest was minimal (only $269). More important was the manual work which the parties did in relation to those renovations. They both did some painting. However the plaintiff left for overseas in November. The defendant, together with her niece, her son and Mr Piggott worked for 21 successive days in painting the house and its surrounds and doing other work such as oiling timber windows, cleaning the front and back yards, cleaning the windows, arranging for the timber floor to be sanded and varnished and creating a small rock garden. This manual labour was contributed by the defendant and by persons on her behalf and is to be recognised as a contribution under s 20(1)(a) in her favour to the conservation and improvement of the 8 Jenner Street property. At the same time it must be recognised that the property was 70% owned by her so that the value of her contribution and that made on her behalf must be discounted accordingly when considering its weight in the scales of a just and equitable adjustment of property interests.
Renovations to 22 Jenner Street
66 In August 1991 the 22 Jenner Street property was repainted and re-carpeted. The parties moved into the 22 Jenner Street property in February 1992. The defendant completed interior painting to the house. A new kitchen was installed in June 1992. The plaintiff paid for the new cupboards, stove, range hood, dishwasher and tiles and the defendant paid for under bench and ceiling lighting and electrical work. The plaintiff claims to have spent a total of $18,453 on renovation work of 22 Jenner Street to this stage and the defendant nothing. However the claim was not particularised. I accept that the plaintiff paid the bulk, but not all, of the costs of this work. It is impossible to attribute precise figures. Doing the best I can on the limited material available I infer that the plaintiff paid about $8,000 more for the cost of this work, than would be reflected in a contribution proportional to his beneficial interest in the property, but that the defendant and not the plaintiff completed the interior painting. These are contributions to be taken into account pursuant to s 20(1)(a) in relation to the conservation and improvement of 22 Jenner Street.
67 In 1993 the upstairs area to 22 Jenner Street was substantially rebuilt. This work continued into 1994. The plaintiff paid the costs of those works amounting to $72,468. This was almost $40,000 in excess of his 45.5% beneficial interest in the property and is to be treated as a contribution in that amount, to the improvement of the 22 Jenner Street property for the defendant’s benefit. Whilst this renovation work was proceeding the defendant continued to do the housekeeping work under difficult circumstances. She spent many additional hours trying to protect the carpets, furniture and clothes from the dust of the upstairs work. After the work was completed she cleaned the interior of the house. She purchased the paint and painted the ceilings and walls upstairs and cleaned the cement and paint specks left on the windows. She and Mr Piggott cleaned up the yard after the builder had left. She and the plaintiff oiled the cedar doors and windows and the cedar in the stairwell. The plaintiff drew original design plans for the renovations and engaged the draughtsperson to prepare the plans. He engaged the builder and transported slate floor tiles from his Fishing Point property for use in the renovation. The plaintiff sealed the slate areas and painted new downstairs timber decking erected in late 1994. So far as non-financial contributions to the 1993-94 renovations of 22 Jenner Street are concerned, I think there is some preponderance in favour of the defendant, but it is not of great significance.
68 In late 1998 and early 1999 further renovations were undertaken by the installation of a new bathroom. The plaintiff paid about $15,000 being the cost of this renovation. This should be recognised as a contribution of $8,000 for the benefit of the defendant.
69 During the period between 1991 and 1999 the defendant spent various monies on fixtures and fittings for the 22 Jenner Street property and for trades improvements and repairs. She asserted that she spent $28,243 on fixtures and fittings during this period, $12,238 in trades for improvements and repairs and $4,534 in hardware, paint and other like purchases. The plaintiff submitted that some of the amounts which the defendant listed could not be classified as payments of a capital nature, but related to items of routine maintenance which are part of normal domestic expenses. However although this distinction is relevant, it is not of great significance in the present case. Insofar as the defendant made contributions to normal domestic expenditure they benefited herself, the plaintiff, and to a certain extent her son. However Samuel Egger’s presence at 22 Jenner Street reduced after September 1993 as he spent many nights staying with his girlfriend. To an extent the defendant’s normal domestic expenditure also benefited her father who started living at the 22 Jenner Street property after he became ill in April 1997. Thus her payments towards normal domestic expenditure contributed to the plaintiff’s welfare by an amount which should be valued at less than half the amount of the expenditure. Given that the plaintiff had a 44.5% beneficial interest in 22 Jenner Street, her capital payments towards the improvement of 22 Jenner Street contributed to the improvement of his interest in the property by 44.5% of the cost of the improvements, (whilst recognising that the contribution to the cost of improvements would not necessarily equate to an increase in value to the same amount). It is not possible to make an accurate dissection of this expenditure as between capital and normal domestic expenditure. Taking a broad brush, I consider that it is appropriate to recognise 40% of this expenditure as a contribution made by the defendant to the improvement of the property of the parties or to the welfare of the plaintiff to be recognised for the purposes of subs 20(1). That amount is $18,000.
Overseas Travel in 1991
70 On 16 November 1991 the plaintiff departed overseas for study leave. He was joined by the defendant on 8 December 1991. They returned on 7 February 1992. The plaintiff paid for the defendant’s travel expenses and paid the costs of car hire and accommodation although most of their time was spent staying in college at Cambridge University. The defendant’s expenses to which the plaintiff contributed totalled $5,643. The defendant paid for holidays in Malaysia on their return home. She paid $2,952 for those expenses which covered both of them. There was a net contribution of just over $4,000 by the plaintiff. Against that the defendant did the cooking and washing whilst they were staying at Cambridge.
71 This last is a slight matter to be taken into account under s 20, although it cannot be excluded as irrelevant. It is part of the background to a letter written by the defendant to the plaintiff in early 1992. It is to be recalled that at this time the defendant was the sole registered proprietor of the property at 22 Jenner Street and was the holder of half of the shares in Indecs Llwynog. Her letter read in part:
“I have spent some time examining bank statements, receipts and sundry other documents but find that I am unable to unscramble our financial affairs. It is virtually impossible for me to establish our respective contributions and interests and therefore I must ask you to either undertake this task or alternatively arrive at an appropriate division for translation into a legally binding document.
I acknowledge freely and willingly the generous and overwhelmingly greater contribution you have made and wish this to be recognised in the division of assets. …. Given what I started with and taking into account current property values, financial contributions and non-financial contributions I would like to end up in an approximately equivalent position to that before I started. I would like to retain (and this is subject to negotiation if you think my claim is excessive) sole ownership of a house (preferably No. 8) subject to a mortgage of between $60,000 and $100,000 and a car (preferably the Nissan).
I am quite prepared for you to take full ownership of the companies, No. 22 Jenner Street and to sell the Hyundai. Any furniture you wish to claim is acceptable to me. If you believe my claim is excessive I am prepared to accept less.
…….
I am very grateful for everything you have done for me and the considerable material benefits I have enjoyed over the last four years. It does now, however, appear to represent a further complication in our already complicated relationship and I would like to sort it out as soon as possible. You are obviously anxious that your interests are unprotected …….”I would like you to seek legal advice and draw up a statement which gives legal effect to our respective interests as soon as possible. You may show this letter to (and file it with) your solicitor as evidence of my intentions.
72 There was no response to the letter and nothing was done to give legal definition to the parties’ respective interests. The defendant said that she was trying to be conciliatory and exaggerated the extent of the benefits which the plaintiff had given her.
73 The principal importance of the letter is in assessing the credit which should be given to evidence the defendant gave before me of conversations which she had with the plaintiff in 1991.
74 The defendant said that in 1991 she complained to the plaintiff that she was paying all the bills and that this was unfair. According to her, the plaintiff said:
“It only looks unfair. We’re using your money at the moment, but that’s because we are building up our cash reserves in the company. The company now has about $60,000 sitting inside it. Half of that money is yours.”
75 The defendant said that after an argument, she ultimately accepted the plaintiff’s position and continued to spend her money on domestic expenses for the benefit of both she and the plaintiff, whilst the plaintiff’s income was directed to the company such that it built up extensive assets. She complained to him that she didn’t know what the plaintiff spent his money on, as she never saw it, and that he had to start paying his way. She said that a few weeks later she again complained that she was doing all the work and that the plaintiff had never done anything. She complained that she was continually exhausted, that she had a demanding job which paid all their bills and that she could not continue in that way. She complained that the plaintiff had an expensive lifestyle at her expense; that she had no savings and no discretion as to how to spend her earnings because they were all eaten up in his lifestyle.
76 She said she had another conversation in which she complained about having to take all the domestic workload and the plaintiff said “I know it doesn’t look good, but the company is our joint savings account. We both earn it.” In the same conversation she said that she complained that she was nothing but a domestic slave: she had no holidays and no money.
77 I cannot reconcile this evidence with the letter written in early 1992. Those conversations were deposed to with a wealth of circumstantial detail. But their inconsistency with one of the few contemporaneous documents that were tendered emphasises the need for caution before accepting the defendant’s evidence of such conversations. In this case the processes of memory have been overlaid, even if subconsciously, by considerations arising from the later bitter breakdown of the parties’ relationship and the current litigation.
Discharge of Defendant’s Liability to St George Bank
78 On 19 October 1995 Indecs Llwynog paid $40,000 and on 17 May 1996 paid $55,000 to reduce the defendant’s obligations to St George Bank arising from her borrowing for the purchase of 22 Jenner Street. Initially in the accounts of Indecs Llwynog, the payments were treated as a loan from the company to the defendant. However full accounting records for the company were not kept. For example, there were no ledgers showing movements in the loan accounts of the plaintiff and the defendant. It is not possible to identify accurately what adjustments were made to the defendant’s loan account. However it appears from a working sheet in the handwriting of the plaintiff that against the debt of $95,000 there was offset amounts totalling $10,955 owed by the company to the defendant and there were further offsets totalling $3,155, which I infer were for company expenses paid by the defendant. This reduced the loan account to $80,890. There is then recorded a “transfer” to the plaintiff of $44,525, which appears to have been an assumption by the plaintiff of that part of the defendant’s debt owed to the company. This reduced the defendant’s debt to $36,365 which with interest was recorded as $37,842. However these figures do not tally with the figures in the balance sheet which recorded a debt owed by the defendant to the plaintiff at 30 June 1996 in the amount of $44,161. In the following year the loan to the defendant was recorded as zero. It appears that the defendant’s debt of approximately $81,000 owed to the company was assumed by the plaintiff. This is an amount which should be recognised as a contribution to her welfare made by the plaintiff.
79 Contrary however to the plaintiff’s submissions, the reduction of the St George Bank’s loan by $95,000 from monies borrowed from the company, and the subsequent assumption of the defendant’s debt to the company by the plaintiff, did not alter the beneficial interests in 22 Jenner Street. Nor was the plaintiff subrogated to St George’s rights as mortgagee. There was a small balance left owing to St George. Nor was there any basis for implying an agreement that the plaintiff, or Indecs Llwynog, would be entitled to a charge over the property to secure the indebtedness. Plainly no such charge was intended.
Alleged Agreement for the Division of Assets
80 The defendant complained that on about four occasions in 1994 the plaintiff slapped her across the face during arguments. There was a physical altercation in 1995. The relationship between the parties deteriorated. The defendant complained of similar incidents in 1996. In April 1996 she decided that she could not continue in the relationship. She left the Jenner Street property and rented a flat in Manly. She gave evidence that the plaintiff asked her to return, promising to pay his share of expenses and do work around the house and not to hit her again. She said that she agreed to return and give the relationship one more try but only on the condition that the plaintiff promised that if it did not work out and the parties broke up, the assets would be split. She said the following conversation occurred:
“The plaintiff said ‘I agree. If it doesn’t work out, we’ll split everything 50/50. I think that’s the only fair thing given how we have lived.’ I said ‘We need to be more precise than that. What does 50/50 mean?’ He said ‘Our pre-relationship assets should be immune, but everything we have acquired in the course of the relationship is to be evenly divided. The house, the company, the shares, everything.’ I said ‘It’s still not clear. What about the capital gain in pre-relationship assets?’ He laughed and said ‘We should probably do that as well, but it will benefit me rather than you. Most of my pre-relationship assets are in South Australia and Western Australia and the market has been completely flat. No. 8 Jenner Street has increased substantially in value. But if that’s what you think, the capital gain is to be divided evenly as well.’ ”
81 The defendant said that because of these promises she returned to the house.
82 The defendant initially pleaded this agreement as one whereby it was agreed that in consideration of her meeting the outgoings in respect of the property in which the parties resided and meeting all of the domestic expenses associated with the parties’ residence together, the plaintiff would share with the defendant any property acquired by or on behalf of himself or her, and any increase in the value of any of the property held by or on behalf of either of the parties. The pleading was contained in her cross-claim filed on 8 March 2002, some six months before the defendant swore her affidavit. The agreement as deposed to by the defendant was not couched in those terms. She did not depose to a conversation which expressed the consideration for the promises for the division of assets as being her promise to meet the outgoings in respect of the property and all domestic expenses.
83 In the amended cross-claim filed on 21 November 2002, after the defendant swore her affidavit, she alleged that the consideration for the agreement was the defendant’s continuing with the relationship and having met the outgoings in respect of the property in which the parties resided and the domestic expenses associated with their residence together.
84 Understandably, the plaintiff relied upon the differences between the way the alleged agreements were pleaded and the differences between each pleading and the defendant’s affidavit. However I am not persuaded that this is a sufficient ground for not accepting the defendant’s testimony. It is true that the defendant is herself legally qualified and an Associate Professor in Law with the University of New South Wales and that she verified each pleading. However she did not perceive there to be any relevant difference between the pleadings and her affidavit, and I think it more likely that the differences were due to an error on the part of the pleader. The consideration for the alleged promises about the division of assets was the defendant’s agreement to resume co-habitation with the plaintiff.
85 I do not regard the fact that the defendant did not meet or continue to meet all of the outgoings and domestic expenses as a ground upon which the alleged agreement would be unenforceable.
86 However, I am not satisfied that the agreement deposed to by the defendant was made. The plaintiff denied that such a conversation took place. There is no corroboration of it. There are three matters which tell against there having been an agreement to the effect alleged.
87 The first is that if the alleged agreement was made, it was intended to have legal effect. However, if the defendant had intended to make such an agreement with legal effect, it is probable that she would have taken steps to have the agreement reduced to writing. She had previously expressed the wish for the parties to define their legal relationship in writing. She appears to have been conscious of the need, or at least the desirability, for writing, if certainty were to be achieved. Since writing her letter in 1992, the parties’ relationship had deteriorated. According to her, she had been subjected to violence, and the plaintiff had repeatedly reneged on his promises to pay a reasonable share of expenses and to shoulder an appropriate share of the burden of work about the house. On her version of events, she could have had no confidence that the plaintiff would keep such an oral promise.
88 The second reason why I do not accept this part of the defendant’s evidence is that after the parties separated in September 1999 she made no request to the plaintiff that he honour the alleged agreement. Her cross-claim was not filed until two and a half years after the parties’ separation. Her only explanation for the failure to demand performance of the agreement was that she could not face approaching the plaintiff after she had obtained an apprehended violence order against him at the time of their separation. However both parties had legal representation and there is no sufficient explanation of why no demand for performance of the alleged agreement was made.
89 My third reason for not accepting this part of the defendant’s evidence is that I am not satisfied that her present memory of such an event is reliable for the reasons which I have given in relation to earlier evidence of conversations to which she deposed and which I have not accepted.
Acquisition of 10 Abernethy Street, Seaforth
90 In about mid 1998 the parties’ relationship was still bad. The defendant said that she wanted to sell 22 Jenner Street and move to a new house which was less work and which did not need constant renovation. They inspected a house at 10 Abernethy Street, Seaforth. According to the defendant, she said that she would not agree to a joint tenancy unless each of them put in the same amount. The plaintiff agreed, but said that he had not worked out precisely how he would do it, but that they would each put in the same amount and both go on the title. The parties purchased 10 Abernethy Street at auction on 19 September 1998 for $1,550,000. The total cost of the purchase (not including loan fees which are not a relevant cost for this purpose), totalled $1,622,223. (This figure also excludes the adjustments for rates etc. on settlement). The property was bought by both parties as joint tenants. However it is to be presumed, in the absence of contrary evidence, that the parties intended the beneficial ownership of the property to be held in the same proportions as that to which they contributed to the purchase price. Neither party submitted that it was their joint intention that they hold the property beneficially in equal shares. The evidence of the defendant indicates that the parties intended to hold the property in equal shares only if they made equal contributions.
91 The bulk of the purchase price was funded by joint borrowings from the St George Bank, from Indecs Llwynog, and by a personal borrowing by the defendant from her father. However a substantial part of this borrowing was intended to be bridging finance to be repaid from the sale of 8 Jenner Street and 22 Jenner Street. The property at 22 Jenner Street was listed for sale at the end of September 1998. 8 Jenner Street was listed for sale by auction on 21 November 1998. In my view, in calculating the parties’ respective contributions towards the purchase price it is necessary to consider not their initial joint borrowings, but their ownership of the proceeds from the sale of the two properties which were used, and which were always intended to be used, to discharge or reduce those borrowings. The position is analogous to a case where parties intend to acquire land freed from a mortgage, where the monies paid to discharge the mortgage must be taken into account when determining the beneficial interests of the parties. (Block v Block (1981) 180 CLR 390; Calverley v Green (1985) 155 CLR 242 at 263; Jacobs’ Law of Trusts in Australia, 6 ed para 1211).
92 The sale of 8 Jenner Street settled on 22 January 1999. The net sale proceeds received were $606,786. $605,805 was paid to reduce the St George Bank loan over Abernethy Street.
93 In relation to that sale, it should be noted that legal fees and expenses and agent’s commission and advertising costs totalled $17,214. Of these the plaintiff contributed $15,412 or $10,248 more than his 30% share of that property. That sum should be recognised as a contribution made by him to the acquisition of the proceeds of sale of the 8 Jenner Street property.
94 The sale of the property at 22 Jenner Street was settled on 23 April 1999. The agent’s commission was deducted from the deposit. The defendant paid legal search and survey fees of $1,386. Advertising costs of $11,175 were dealt with jointly. It is not necessary to cosider any s 20 adjustment in relation to these payments. The amount received after selling costs was $774,454. These monies were used to repay the loan from the defendant’s father ($85,000), to discharge the debt from Indecs Llwynog ($621,767.52), to reduce the St George Bank mortgage by $18,528, to discharge various other payments relating to the 22 Jenner Street and Abernethy Street properties, and to pay $14,000 to the plaintiff and $18,000 to the defendant. These payments are roughly in accordance with the parties’ beneficial interests in that property.
95 Treating the net sale proceeds of 8 and 22 Jenner Street as contributions to the purchase of Abernethy Street to the extent the payments were made in reduction or discharge of loans used to acquire Abernethy Street, it can be seen that the defendant’s contributions from these sources was 70% of $605,805 (the St George Bank loan reduction from the sale proceeds of 8 Jenner Street), or $424,063, and 55.5% of the sum of the three payments of $621,768, $85,000, and $18,528, (total $725,296), or $402,539. The defendant’s contribution to the purchase price of Abernethy Street derived from the sale proceeds of the two properties was thus $826,602.
96 The plaintiff’s contribution to the purchase price of Abernethy Street derived from the sale proceeds of the two properties was 30% of $605,805 ($181,741) and 45.5% of $725,296 ($322,757). This totalled $504,498. The plaintiff contributed an additional $23,292 from his own sources.
97 The balance of the monies were provided from joint borrowings from the St George Bank and Indecs Llwynog. After reduction of those borrowings from the sale proceeds, the joint outstanding borrowings totalled $295,797. I think it is appropriate to treat this amount as having been provided equally by the parties notwithstanding the events to which I will later turn. There is no evidence that at the time of the purchase there was any agreement between the parties that the plaintiff would be solely responsible for this debt. Therefore each party’s contributions to the purchase of Abernethy Street should include an additional sum of $147,898.
98 The figures thus arrived at exceed the purchase price of the Abernethy Street property by about $28,000, reflecting the fact that the loans were not discharged until some months after the purchase. The parties’ respective contributions to the purchase were: plaintiff, $675,688; and defendant, $974,500. Accordingly the plaintiff had a 41% beneficial interest in 10 Abernethy Street and the defendant had a 59% beneficial interest.
99 The plaintiff submitted that it was wrong, or at least unnecessary in principle, to seek to identify the parties’ beneficial interests in 10 Abernethy Street before deciding what, if any, adjustment should be made to the parties’ interests in property. It was submitted that such an exercise is not warranted by the Act, that it may lead to a position which is inconsistent with the Court’s obligation to finalise the financial matters arising between the parties, (s 19), if it is found that no adjustment to the interests is necessary, and was outside the boundaries of the dispute as pleaded.
100 However Subsection 20(1) refers to making such order adjusting the “interests of the parties in the property” as to the Court seems just and equitable having regard to the matters stated in paragraphs (a) and (b). “Property” is defined widely to include any estate or interest in real or personal property. This must include equitable estates and interests under implied trusts. There is authority that the Court is not required in all cases to first ascertain in full detail what are the parties’ property interests by reference to the general law, at least where the law of constructive trusts may define those interests. (Evans v Marmont (1992) 42 NSWLR 70 per Gleeson CJ and McLelland CJ in Eq at [84]. In Jones v Grech (2001) 27 Fam LR 711 Davies AJA said (at 722-3) that “the Court should start with an understanding of the property interests of the parties for it is those interests which are to be adjusted.” His Honour went on to say that in a simple case where both parties are on the title as joint tenants then, unless the issue as to title is raised, the Court should proceed upon the footing that the parties’ interests are as shown on the title. In that case his Honour went on to say why the parties’ beneficial interests coincided with their legal interests. In Evans v Marmont Gleeson CJ and McLelland CJ in Eq considered the likely beneficial interests of the plaintiff under a constructive trust to be relevant to the inquiry under the Act.
101 As the Court is required to consider making an order adjusting property interests there can be no inhibition on its first ascertaining what those interests are, even if there are cases where it is not necessary to carry out such an exercise because it would be subsumed by the inquiry under s 20. As Davies AJA said in Jones v Grech the Court should understand what are the property interests which are to be adjusted.
102 I find it of assistance in this case to identify the parties’ beneficial interests in 10 Abernethy Street by reference to their contributions to the purchase price, and then assess whether any adjustment to those interests is warranted by reference to their contributions falling within s 20 which have not been taken into account in determining those beneficial interests.
103 In my view, to do otherwise in this case would be an error because it would ignore the effect which the contributions to the purchase price have already had in determining the parties’ proprietary interests. To assume such contributions have had no effect on the parties’ proprietary interests, but are to be considered as part of a discretionary adjustment along with a mix of other factors, would be to treat s 20 as displacing rather than supplementing principles of equity.
104 The Act does not so provide. To the contrary, s 7 provides that nothing in the Act derogates from or affects any right of a party to a domestic relationship from applying for any remedy or relief under any other law.
105 In this case the evidence necessarily raises the issue of what the parties’ beneficial interests in the property at 10 Abernethy Street are. As both parties have sought orders under s 20, they have, it seems to me, raised the question of what the parties’ interests are of which each seeks an adjustment.
106 It is true, as counsel for the plaintiff submitted, that the attempt to identify the beneficial interests of the parties raises questions of law before the making of an adjusting order, which involves questions of discretion. This increases the chance of the trial judge committing appellable error. However that is not a relevant consideration. Nor do I accept that for the Court to ascertain the parties’ beneficial interests in property before making an order for adjustment under s 20 is inconsistent with the Court’s duty under s 19, particularly having regard to the width of the Court’s powers to make orders under s 38 and to make declarations as to title pursuant to s 7.
The Servicing and Discharge of the St George Bank Loan
107 The monthly interest and bank charges associated with the loan from St George Bank were met by the plaintiff. On 1 July 1999 the parties jointly borrowed $250,000 from Indecs Llwynog which was used to reduce the loan from the St George Bank. The defendant did not repay any of the principal or interest on these loans. As I understand the plaintiff’s evidence and submission, he has paid or accepts liability for amounts totalling $296,245 owed to St George Bank and Indecs Llwynog, being monies borrowed for the acquisition of the 10 Abernethy Street property or to refinance such borrowings. The plaintiff was not subrogated to the rights of the St George Bank as mortgagee. He was a joint borrower. Nor has Indecs Llwynog maintained any claim to be subrogated to the rights of the St George Bank. It is not clear whether it would be so entitled. In any event, the plaintiff accepts that as part of the orders to be made to finalise the financial matters arising between the parties, he should indemnify the defendant against any liability to Indecs Llwynog. The plaintiff would be entitled to contribution at law or in equity from the defendant for the amount which he paid in excess of 50% of the debt. However that is a matter which will be subsumed by the inquiry of what, if any, adjustment to the parties’ property interests is appropriate under s 20. For that purpose 59% of the payments made by the plaintiff, or an amount of about $175,000, should be taken into account as a contribution for the benefit of the defendant in relation to the conservation of the Abernethy Street property, or otherwise made for her welfare.
Defendant’s Occupation of 10 Abernethy Street After October 1999
108 After October 1999 the defendant has been in sole occupation of the property at 10 Abernethy Street. She has not paid rent or an occupation fee for that occupation. For the reasons I have given, I consider that contributions made by either of the parties to the welfare of the other after the termination of the relationship are to be taken into account under subs 20(1). It is unnecessary to decide whether the defendant would be liable in equity to account to her co-owner for an occupation fee. (Ryan v Dries [2002] NSWCA 3, 10 BPR 19,947; Biviano v Natoli & Ors (1998) 43 NSWLR 695). In my view the plaintiff has made a contribution to the welfare of the defendant by her occupying the house of which he is a 41% beneficial owner without fee. The defendant points to contributions she has made in respect of the maintenance of the property from 7 September 1999 by way of repairs to the house, the installation of curtains and floor-coverings, general maintenance to the house and garden, and the payment of council rates, water rates, house insurance and electricity. The total amount spent by her on the property comes to $41,923. The evidence of the rental value of the property was not very satisfactory, but it was uncontradicted. On 28 October 2002 a local real estate agent expressed the opinion that once certain defects to the 10 Abernethy Street, Seaforth property were fixed it should realise a rental of around $1,100 to $1,200 per week. The work which the agents considered should be attended to involved fencing near steep drops on the property, the repair of sandstone walls, and the repair of rotting wood on the terrace. Making a slight discount for the cost of such alterations, I accept that the rental value of the property for the period of about four years and nine months from the parties’ separation to the date of hearing is $271,000. The net contribution made by the plaintiff in relation to the defendant’s occupation of the property between separation and the hearing is thus 41% of $230,000 or $94,000. I assume also that the defendant has had the benefit of occupation of the property without fee between the hearing and the date of this judgment.
138 The plaintiff also said that in the first week of March 1999, following a disagreement, the plaintiff slapped her across the face causing her earring to rip out of her earlobe and that he pushed her down a small flight of stairs. She said that in May of that year the plaintiff slapped her across the face several times and she moved her clothes downstairs where she spent about half of the next five months. From June 1999 the defendant claimed that she avoided contact with the plaintiff because she was in fear of physical assault. She said that on about two or three occasions at about this time she was hit across the face and her fingers were bent back and injured. She said that on another occasion she was choked to the point of unconsciousness and suffered a number of bruises around the throat. She said that there were further episodes of verbal abuse in August and that she was slapped on another four or five occasions at this time. Finally, for present purposes, on 7 September 1999 there was another physical altercation between the parties.
139 It was the plaintiff’s case that from about August 1999 the defendant set out to provoke the plaintiff into some act that would provide a basis for a complaint of an apprehended domestic or personal violence offence. Following the incident on 7 September 1999 the plaintiff remained in the house. Certainly the defendant addressed a very abusive letter to him at this time, but I am not satisfied that that allegation (which goes only to credit) is made out.
140 The defendant filed a summons in the Local Court on 19 October 1999 seeking an apprehended violence order. In support of that summons she prepared a statement which stated that over the previous twelve months she had been subjected to verbal and physical abuse on several occasions. She also said in the statement that prior to September 1998 there had been physical and verbal abuse, but not as frequent or as serious as that after September 1998. In the statement she gave evidence, which she repeated before me, of the events from December 1998 to September 1999. On 26 October 1999 an order was made in the Manly Local Court that the plaintiff was not to enter upon the downstairs area of the dwelling at 10 Abernethy Street, Seaforth (except the laundry area which he might access externally). The plaintiff was permitted to occupy the upstairs area of those premises. A final order was made on 22 February 2000. By that order the plaintiff was excluded from entering the main house at Abernethy Street. He was permitted to occupy the small separate cottage of that street which had been occupied by Mr Piggott. However he vacated the premises, in fear, he said, of physical reprisals from the defendant’s son if he did not.
141 I take the plaintiff to have denied the defendant’s allegations. The plaintiff submitted that I should not be satisfied, having regard to the seriousness of the allegations, that the conduct alleged by the defendant occurred. It was a matter of word against word, with no corroborative evidence adduced by the defendant, although in respect of at least one of the incidents in which the defendant said that she received assistance from Ms Walker, corroborative evidence should have been available if the incident occurred as she alleged. Nor was evidence given by Mr Samuel Egger or Mr Piggott of having observed any injuries to the defendant. It was also submitted that some parts of the defendant’s descriptions of being attacked were unbelievable and that her evidence must have been exaggerated. She described the incident of 10 December 1998 where she claimed that the plaintiff kicked her in the stomach several times. She said she was standing while the plaintiff was lying on the bed and that he half raised himself and repeatedly kicked her in the stomach. It was suggested that in those circumstances, she could have simply stepped back after the first kick. However I do not think that is necessarily so, nor that the circumstances can be accurately recaptured in questions and answers in cross-examination which seek a logical explanation for behaviour where the parties were not acting logically.
142 The plaintiff also said that if the incidents had occurred, as the defendant claimed, she would have gone to the police. However the defendant said that although she was fearful of her safety before and following the attacks in 1995, 1997, 1998 and 1999, she did not want the embarrassment that would follow from recounting her experiences in court if she approached the police.
143 The plaintiff also submitted that the defendant’s evidence of events prior to September 1998 was inconsistent with her statement in the Local Court proceedings to which I have referred above. However I see no inconsistency.
144 I have previously explained that I have some reservations about the accuracy of the defendant’s evidence in which she has recounted details of conversations which occurred many years in the past with the plaintiff and where I consider that the accuracy of her recollection has been affected by the stress of the breakdown of the relationship, the disputes between the parties and the litigation. That does not mean however that I do not accept her as a witness who endeavoured to tell the truth. In relation to her evidence of physical and verbal abuse, I consider that her evidence should generally be accepted. It is likely that she would remember those events if they occurred and I do not think she was making them up. I consider her memory of those incidents to be much more reliable than her reconstruction of conversations. On this subject, I consider her evidence more reliable than the plaintiff’s denials. Also, in a number of cases, her conduct immediately after the incidents in question is consistent with events having occurred as she deposed. Thus although the plaintiff rightly points to the absence of corroboration from Ms Walker of the defendant’s evidence of having been taken by Ms Walker to stay after she was repeatedly punched in January 1999, such that she had many large bruises on her body, the defendant did leave the house to stay with Ms Walker for a number of days and on her return she slept in a separate room from the plaintiff. Similarly, in 1996 the defendant left the house and rented a flat in Manly for a short period, which is consistent with her evidence that their relationship had deteriorated to the extent that she had been slapped across the face so that when the plaintiff went overseas for about two weeks, she moved out of the home.
145 Nor is the absence of corroborative evidence from Mr Samuel Egger and Mr Piggott a sufficient reason for preferring the defendant’s denials. The defendant simply did not confide these events affecting her personal life in them. Mr Egger did give evidence of his mother being upset from time to time. But it is understandable that she did not confide in him, the reasons for her being upset.
146 I also accept the defendant’s explanation for not having called the police. In her professional work, the plaintiff had written and worked extensively in the area of domestic violence. She would have regarded it as humiliating to have made a complaint to the police. It was that, coupled with a hope that matters would improve, or the parties’ relationship would end, which is the explanation for her not complaining.
147 Notwithstanding the seriousness of the allegation which is made, I am satisfied on the balance of probabilities, having taken into account the gravity of the matters alleged, that the conduct as described by the defendant to which I have referred above, occurred.
148 Uninstructed by authority it would seem to me that this evidence is potentially relevant in three ways. First, the plaintiff’s conduct may have increased the arduousness of the defendant’s contributions as a homemaker such that they should be given greater weight. Secondly, this aspect of the plaintiff’s conduct could be considered when making an assessment of the extent to which, overall, he contributed to the defendant’s welfare. Thirdly, this aspect of his conduct could be assessed when considering the nature and incidents of the relationship as a whole as providing the context within which a judgment is to be made of what adjustment of property interests is just and equitable having regard to the parties’ contributions within s 20(1)(a) and (b).
149 There is no doubt that the evidence is relevant in the first of these ways. (Jackson v Jackson [2000] NSWCA 303 at [29]-[31]. The plaintiff submitted that this was the only way in which the evidence could be relevant, and in support of this submission relied on the observations of Santow AJA (as his Honour then was) in Killick v Killick (1997) DFC 95-180 at 77,568 and the decision of the Full Court of the Family Court in Kennon v Kennon (1997) 22 Fam LR 1 at 22, 24.)
150 These authorities do support the plaintiff’s submissions as to the limited basis on which the evidence is relevant and the defendant did not seek to support its relevance on any wider ground. Accordingly, I will not treat it as having a wider significance.
151 The plaintiff also submitted that there was no evidence that such conduct increased the arduousness of the defendant’s contributions. It was submitted that it was not self-evident that it would do so. I do not agree. I think it is self-evident that the contributions made by the defendant as a homemaker were more arduous by reason of the fact that the person for whom she was working about the house descended, on occasion, to such conduct. It is a factor which increases the weight to be given to her role as a homemaker.
Parties’ Assets at the Hearing
152 As at the hearing the plaintiff had the following assets:
(a) His beneficial interest in 10 Abernethy Street, Seaforth. The property had an agreed value of $2,900,000. His 41% beneficial interest in that property was thus worth $1,189,000;
(b) shares in Indecs Llwynog Pty Ltd. He held 100% of the shares in the company which had net assets of $1,006,961;
(c) shares in Indecs Markets Pty Ltd, $105,265;
(d) 7 Bowillia Avenue, Hawthorne, (South Australia), $420,000;
(e) 140 Sealand Road, Fishing Point, $750,000;
(f) 32 Bussell Road, Wembley Downs (WA), $900,000;
(g) bank accounts, $410,000;
(h) shares in public companies, $314,755;
(i) furniture, furnishings and personal effects: no specific value was attributed to these assets.
153 He also had financial resources being interests in superannuation funds totalling $936,409. His liabilities totalled $246,500 being monies owed by him to Indecs Llwynog and Indecs Markets. Thus his financial position at the hearing was that he had net assets, including financial resources, of about $5,785,000.
154 The defendant’s assets at the date of the hearing comprised the following:
(a) her interest in 10 Abernethy Street, Seaforth worth $1,711,000;
(b) bank savings totalling $136,979;
(c) financial resources comprising interests in superannuation accounts totalling $542,283;
155 On the basis that she had no liability to Indecs Llwynog, she had no material liabilities. Her assets, including her superannuation accounts, therefore totalled about $2,390,000.
156 The net worth of each party had substantially increased since the commencement of the relationship. A precise comparison of their respective increases in net worth is not possible as the evidence did not establish the value of the plaintiff’s real property at the commencement of the relationship. I infer however that there was a substantial increase in their capital value. Leaving aside the 10 Abernethy Street, Seaforth property, this is not a case in which the financial or non-financial contributions made by the defendant contributed to the increase in the net worth of the plaintiff. The increase in his net worth is primarily due to the increase in capital value of the real property which he owned before the commencement of the relationship and to the value of Indecs Llwynog Pty Ltd. The assets held by that company are primarily due to the income generated by the plaintiff, or by employees of the company during the years 1996 to 1998. For the reasons I have given, I do not consider that the defendant made a contribution to the financial position of the company for which she has not been fully compensated. Nor, for the reasons I have given, do I consider that the plaintiff’s ability to service and extinguish his borrowings is attributable to the efforts of the defendant. Accordingly I do not consider, in the circumstances of this case that a consideration of the disparity of the net worth of each of the parties at the end of the relationship, or a comparison of their positions at the end of the relationship compared with their positions at its beginning, is a useful guide to determining the impact of their respective s 20(1) contributions. However their respective assets have a subsidiary significance when considering what adjustment, if any, to their property interests is just and equitable. (Dwyer v Kaljo (1987) 11 Fam LR 785 at 793; Evans v Marmont at 75).
What Adjustment is Just and Equitable?
157 I have not referred to all of the contributions which the parties raised for consideration under s 20(1). It seemed that almost no detail of the parties’ eleven-year relationship was omitted as an arguably relevant consideration. Given the width of the criteria in s 20(1) everything which was raised had potential relevance. However not all that was raised had sufficient weight to require separate discussion. By way of example, the defendant often drove the plaintiff to the ferry. Doubtless that contributed to his welfare, but I cannot think that it could have any effect on what order, if any, should be made adjusting their interests in property. The matters which I have previously identified are the contributions falling within paras 20(1)(a) and (b) which I consider to be sufficiently material potentially to warrant an adjusting order.
158 For the reasons I have given the financial contributions under para (a) and (b) favour the plaintiff. But for the defendant’s contribution as a homemaker, the balance of contributions would favour the plaintiff, even after taking account of the defendant’s work in painting, maintaining and renovating Nos. 8 and 22 Jenner Street, Seaforth.
159 The difficulty is in assessing how the defendant’s contribution as a homemaker, is to be assessed. It is not to be given a monetary value by reference to how much it would cost to have a third party provide those services, but is to be given “full and proper value” (Evans v Marmont at [74]).
160 It is neither necessary nor appropriate to put a monetary value on the defendant’s contribution as a homemaker in order to reach an accounting balance. In Davey v Lee (1990) 13 Fam LR 688, McLelland J (as his Honour then was) said that rather than putting a monetary value on each alleged contribution to reach an accounting balance, the Court was required to make a holistic value judgment in the exercise of a very general discretionary power. The Courts are usually unable to say why contributions of a non-financial kind to the welfare of another party should be reflected in an adjusting order in any one particular sum rather than some other sum (eg Evans v Marmont at 85B and 97C; Powell v Supresencia (2003) 30 Fam LR 463; [2003] NSWCA 195 at [77], [78]). The criteria to guide a discretionary judgment are so general that in the final analysis, the outcome depends on the judge’s impression of a mix of factors whose weight cannot be exactly weighed.
161 In paragraph 131, I identified the financial contributions of the parties as favouring the plaintiff by no more than $450,000.
162 If valued only in monetary terms, it may be doubted whether the defendant’s non-financial contributions, including those as homemaker, would be valued as high, even recognising that she performed that role for over eleven years (although less completely in the first three years).
163 However I prefer not to attempt an assessment of the defendant’s non-financial contribution in monetary terms. In my view, the defendant in making her contributions as a homemaker, including her contributions to domestic expenditure, but more significantly by her labour, carried out her role in the relationship at least as well and as fully as the plaintiff carried out his role in, principally, making financial contributions. (Mallet v Mallet (1984) 156 CLR 605 at 625, 636). If I am wrong in this, nonetheless, there are three other matters to be considered in the final judgment. The first is to recognise the substantial margin for error in the assessment of the parties’ respective financial contributions. The second is that during the course of the relationship there would have been reciprocal benefits of an intangible kind such as companionship and emotional support passing between the parties. The third is that the parties’ present means are relevant as a subsidiary consideration, in assessing what adjustment, if any, is just and equitable. The plaintiff has substantially more means than the defendant, although both are relatively well provided for and able to earn income. It is not obviously just that he should be enriched at her expense by the making of an adjusting order to reflect the fact (if it be a fact) that he, being richer than she to begin with, brought more money to the relationship for her benefit than she contributed in monetary and non-monetary terms for his benefit.
164 Having regard to these considerations I do not consider that any order adjusting the parties’ beneficial interests in 10 Abernethy Street would be just and equitable.
Section 19
165 Section 19 requires the Court, so far as practicable, to make such orders as will finally determine the financial relationship between the parties and avoid further proceedings between them.
166 There is a number of areas in respect of which orders to comply with s 19 should be made. They are the property at 10 Abernethy Street; the defendant’s shares in, directorship of and debt to Indecs Llwynog; her motor vehicle; the plaintiff’s wine still located in the cellar at 10 Abernethy Street; and the jointly owned furniture.
167 In relation to the property, I will make a declaration pursuant to s 8 that the parties hold the property at 10 Abernethy Street, Seaforth on trust for themselves as tenants in common in the proportions of 41% for the plaintiff and 59% for the defendant. Neither party sought a declaration under s 8, as both sought adjusting orders pursuant to s 20. However the question of the parties’ beneficial interests was litigated and for the reasons I have previously given I do not consider that there is anything to preclude my making such a declaration. I will also make orders directing the sale of the property and the application of the net proceeds of sale after costs and expenses of sale in accordance with the parties’ beneficial interests. If necessary, I will appoint trustees for sale, although I trust that the parties will concur in the steps for sale so that the costs of such a course are avoided. I will make an order that neither party is required to account to the other in respect of the defendant’s occupation of the property, nor for her payment of rates, taxes, expenses or otherwise in relation to it.
168 In relation to Indecs Llwynog, the parties are agreed that the defendant will resign as a director, (if she has not already done so) and will execute a transfer of her share to the plaintiff for no, or nominal, consideration. The plaintiff will indemnify her against any liability she may have to the company. The orders should make provision accordingly.
169 The plaintiff also accepts that an order should be made transferring the ownership of a motor vehicle presently used by the defendant from the company to her. The orders should provide for the plaintiff to take all necessary steps on his part to cause the company to effect such a transfer.
170 In relation to the furniture, it seems to me that except for some unidentified items which may belong to Indecs Llwynog, the furniture acquired after May 1988 is jointly owned. Unless the parties have agreed on a division of furniture, I will direct that the furniture purchased by them or either of them between May 1988 and 7 September 1999 and which was located at 10 Abernethy Street be sold and the proceeds divided equally between them.
171 As to the plaintiff’s wine, I will make an order that the plaintiff or his agent be permitted access to the property to collect it.
172 Otherwise, the statement of claim and amended cross-claim should be dismissed.
173 I direct the plaintiff’s counsel to bring in short minutes of order in accordance with these reasons. The orders should deal with any other matter which either party considers it desirable to be dealt with in order finally to determine their financial relationship.
174 I will fix a convenient date to deal with the terms of the orders. Both parties invited me not to deal with questions of costs in this judgment. I will hear argument on costs on that date.
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