Ilitch v Ilitch

[1989] HCATrans 310

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S55 of 1989

B e t w e e n -

RADOMIR ROGER ILITCH

Applicant

and

CAROLE ELIZABETH ILITCH

Respondent

Application for special

leave to appeal

MASON CJ
BRENNAN J

McHUGH J

Ilitch

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 8 DECEMBER 1989, AT 2.06 PM

Copyright in the High Court of Australia

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MR M.L. TRENCH: If Your Honours please, I appear for the

applicant in this matter. (instructed

by Brazel Moore & Co)

MR P.M. FRIEDLANDER:  I appear on behalf of the respondent.

(instructed by Michael Riley & Assoc)

MR TRENCH:  Your Honours, this is an application which has

been prepared by the applicant in person and supported

by an affidavit prepared by the applicant in person

who is present in Court today, Your Honours, and who

has instructed me not to diverge from the application that he originally filed and, indeed, not to make any

other applications or grounds other than those set
out in the affidavit which he supported his application

with.

Your Honours can see that the applicant has set

out in his affidavit in detail the various complaints

he has about the way in which the judge at first

instance, firstly, and secondly, the Full Court,

dealt with his application and appeals.

BRENNAN J:	Mr Trench, one of the rules of this Court is that applications for special leave are made by counsel
only and the purpose of that rule is to ensure that on applications for special leave this Court is seized of arguments which pass the critical judgment of counsel as worthy of presentation. Instructions to the contrary
notwithstanding I would have thought your duty was
to present whatever you may advance by way of telling us where the special leave point lies.
MASON CJ:	By the way, in discharging that duty, you can take

it that the members of the Court have read the

application book and that we are therefore familiar

with all the materials that are in it and the arguments

that have been set forth in writing by your client.

MR TRENCH:	Your Honours, it is difficult to translate into special terms what the applicant himself had in mind
but as best I can do it, it is this: the special
point that the applicant has is that in the application of section 79 to his case, the judge at first instance, firstly, and then the Full Court misconceived the
full import of section 79 and its application to the
assets in his case because of the special circumstances
of his case. That is developed this way: that
section 79A and 79B talks of contributions made by
the parties towards the acquisition, preservation and
maintenance of assets, and in this case the assets,
it was found by both courts, came principally from
contributions made by the husband, that the property
that the parties had at the conclusion of the marriage
was principally the property that the husband had
provided at the commencement of the marriage or within
very short space of the commencement of the marriage
which was a long one. That the contributions made by

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the wife principally fell within section 79(4)(c)

which is a contribution to the marriage as a whole

as opposed to a contribution to the acquisition,

preservation or conservation of a particular asset,

and that Their Honours then transposed that

contribution to the marriage into 40 per cent of the

assets that the parties had at the conclusion of the

marriage. And it appears that the transposition was

only in respect of the matrimonial home in any event.

His argument goes that the wife did contribute

as a homemaker and parent.- that was a finding of

the judge at first instance - that the wife did

contribute by earning income during the course of

the marriage. So did the husband. The husband

contributed by earning income during the course of

the marriage and although it was not found specifically,

no doubt contributed as a homemaker and parent in

various ways. I think the judge at first instance

found that he contributed towards the maintenance

of the surrounds of the house at least. So that any contribution made by the wife under section 79(4)(c)

was at least matched by the husband in contributions

that he was making under the same heading and also

in contributions that he was making in actual terms,

that is, from the income earned during the course

of the marriage.

So that the contributions that he made from the

date of the marriage from his income and the
contributions of the wife as homemaker and parent

and also from partial income should be basically

equal at the end of the marriage and that should,

effectively, leave the greater contribution that the

husband made at the commencement of the marriage still

standing principally as a very extensive contribution.

Now, the husband at the trial and also at the

appeal particularized for. the judge at first instance

exactly what his dollar term contributions were. He

showed how the land upon which the matrimonial homes

was eventually built and in which the parties lived

was purchased from a contribution made to him by

his parents. It was a gift to the husband. Then a

house was built and once again a gift was made sufficient

to practically discharge the mortgage that was borrowed

to build that house. And then thirdly, a car was

bought and once again a gift was made to him by his

parents.

Now, although it was argued at first instance that

it could not be said to be a gift solely to the husband,

certainly the judge at first instance accepted that

any contribution coming into the marriage from the

husband's parents was a contribution on his side of

the ledger, as it were. So that he was able to show,

in figure terms, to the judge at first instance that

of all the contributions that went into the assets

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consisting of the matrimonial home, its contents and the car, his contributions in dollar terms, directly

by himself and by way of gifts from his family,

amounted to something like 95 per cent of the total

acquisition costs of those particular items.

all the contributions, found that the wife had made Now, the judge at first instance, having assessed contributions to the marriage as a whole so as to

relate to the assets of the parties at the end of the
marriage, 40 per cent in favour of the wife and
60 per cent in favour of the husband. Thereafter,
the judge made a further change in those positions
by exercising section 75(2), that is the financial

circumstances of the parties, and corning to the

conclusion that given certain circumstances that

existed at the time that are particularized in the

judgment, a further 15 per cent should be given to

the wife so that an exercise of power under

section 79(2) would be a 55 per cent split of the

assets in favour of the wife.

Now, the assets that in fact were split that way was only one and that was the matrimonial home, and

the balance of the assets which consisted of the

contents and the motor vehicle were in fact directed

to be split equally. In fact, as far as the motor

vehicle was concerned, by the time the judge dealt

with it, it had been converted to a cash sum in so far

as it had been sold and that sum apparently had been

preserved in an account of the wife's.

So, Your Honours, the special point which,

to a certain extent was touched on in the decision of

MALLETT V :MALLETT but which really has not been dealt

with, certainly by this Court, is in circumstances

where the assets that are available for distribution

at the conclusion of the marriage were in fact owned

by one of the parties at the connnencement of the

marriage and therefore the court cannot say that the

party who did not have those assets at the commencement

of marriage did not contribute to those assets during

the course of the marriage other than in the general

sense of perhaps maintenance of them, in those

circumstances, how does section 79(4)(c) get the

non-owner to a substantial portion of the assets at

the conclusion of the marriage? Indeed, the applicant

has quoted a passage from MALLETT V MALLETT which is

part of the application book, on page 25, the bottom

part of it which is an extract from page 79,120,

which deals with contributions made by one party as
a homemaker and parent and goes on to say:

is equal to the financial contributions made to the acqusition of the matrimonial home on the footing that that party's efforts as

homemaker and parent have enabled the other

to earn an income by means of which the home

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was acquired and financed during the

marriage.

So that in the MALLETT V MALLETT case where the

Court dealt with this it was a situation where an

asset was acquired during the course of the marriage

which is largely the case of - people start their

marriage with very little, acquire an asset,

principally a matrimonial home, and that is usually

the main asset for distribution at.the conclusion

of the hearing.

Now, in MALLETT V MALLETT, the purport of the

decision is that the mother who stays at home and cares for the children earns her part of the home

by contributing as a homemaker and parent, whereas

it is the father who actually - or the husband

who actually earns the dollars that buys the home.

So, although the wife has not contributed in dollar sense, she has contributed substantially by looking after the home, looking after the family, so the

husband can go out and earn those dollars to buy that

asset or those assets.

Now, in this case, where the husband owns the

property at the commencement of the marriage and there
is nothing else substantially acquired during the

course of the marriage, the wife cannot say that,

"My homemaker and parent contribution has enabled

the husband to go out and earn income to buy this

asset". All she can say is that it has enabled him

to go out and earn income to pay rates or maintenance

or whatever else is involved in conserving that

asset during the course of the relationship.

BRENNAN J: But even as a matter of fact, can those propositions

be borne out? The husband had some flats in Cooma;

$3500 was contributed towards building the house at

Wyoming; he received $2000 to $3000 from his family

for putting extensions on the house; and he inherited

$21,000 from his mother.	Now, at the end of the day
he has not only got the house; he has got four acres

at Cooma which have a lot of value; the superannuation

which he would have earned during the marriage, in a

sense, has, to some extent, evidently, been dissipated;

and the wife in the meantime has got the care and

custody of Caroline. It is very difficult to say

that you can isolate the house and say that was the

only thing that he has emerged with at the end of the

marriage from the assets that he had to start with.

MR TRENCH: Well, that is right, Your Honour, but I suppose

the thing is that the $21,000 was an inheritance and

in any event appears to have come in at the very tail-end

of the marriage. So that it is an asset that could

hardly be said to have been contributed to by the wife

or, indeed, the husband; it was a pure windfall for him.

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His superannuation: certainly, he had his superannuation.

He got the job that earned the superannuation during the course of the marriage but, of course, he had reached

the stage of retirement and he had to support himself

in the future and it was not a terribly large lump sum

payment. I think it was $16,000 or $17,000, as best

the evidence could establish, that he received in a

lump sum together with a pension. But, certainly,

they were assets that the husband had or the parties

had, to use the phraseology of the Act, at the

time of the hearing, the conclusion.

BRENNAN J: Well, they did not actually have the superannuation,

did they?

MR TRENCH: Well, he had received it.

BRENNAN J: Yes, and spent it.

MR TRENCH: Well, that was unclear.

BRENNAN J: In part.

MR TRENCH:  Yes, part of it had been spent and I think

Her Honour found that there was, as best she could get

to, approximately $13,000 left of the sum that he had

received. She dealt with that in, I think, an

unusual way by referring to it under section 75(2) and

referring to his inheritance as a resource whereas, in

fact, as Mr Justice Nygh pointed out in the Full Court

it is the property of the parties that the court is

interested in, not this concept of marital assets

which is often quite a confusing thing for judges to

deal with.

But the substantial asset, the main asset, was

the matrimonial home. There was some confusion as
to what it was worth but it appears that the Full Court

was satisfied, at least, that Her Honour had reached

the conclusion that the property was worth about

$140,000 to $145,000 and she related that fact then to

the adjustments that she made under section 75(2).	So, certainly at $140,000 to $145,000 it was by far	the most substantial asset that the parties had and
everything else, really, was fairly meagre compared
with that. There was $7000 worth of proceeds from
the car of which, as Your Honour said, the husband had
received a gift from his mother that went partially
towards the purchase of that, and there was his inheritance
which had arrived some time, I think, within six months
of the hearing because there was a reference to an
affidavit - a handwritten affidavit by his mother that
had been taken earlier in the year and that his mother
had died and therefore she was not able to give
evidence at the hearing, so it was very close to the hearing that he had received his inheritance. And, in
any event, one would have thought that if there was no

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contribution to that piece of property it was probably

better looked at as a resource under section 75(2)

when considering any further adjustment that should

be made rather than treating it as a piece of property

to which the parties had contributed, because the wife

had contributed nothing, it had come after the time

of separation. So, she could not have contributed
anything to that particular piece.

So that the husband says then that at the end of the day where the principal asset, $140,000, has come because of contributions by him or made on his behalf fairly early in the marriage, to give him 55 per cent at the end of the day, after doing the calculations

and adjustments under section 79(4) and its

sub-leg of section 75(2), is not a proper exercise

of the power under section 79(2), that is, that it is

not a just and equitable result and the reason is

because of the misapplication of section 79(4) (c).

Now, Your Honours, as my responsibility as counsel,

that is the argument which, in my view, if any argument

is to carry weight with Your Honours that argument is

the best of his arguments but he has, as Your Honours

have read, set out other matters in his affidavit which

were of concern to him and which Your Honours can

readily see are matters that he wished to rely on. But

unless there is some particular part of that affidavit

that Your Honours would wish me to explain or to

assist you with, I do not think it would be helpful to

go into any of those further at this stage.

MASON CJ: Yes, thank you, Mr Trench. The Court need not

trouble you, Mr Friedlander.

The Court is not persuaded that there is sufficient

reason to doubt the correctness of the conclusion reached
by the Full Court of the Family Court as to warrant the

grant of special leave to appeal in this case. The

application for special leave is therefore refused.

MR TRENCH:  Thank you, Your Honour.

MR FRIEDLANDER:  With costs, if Your Honours please.

MASON CJ: Yes. What do you say as to that, Mr Trench?

MR TRENCH:  I cannot say anything, Your Honours. The application

failed and I cannot say anything.

MASON CJ:  The application is refused with costs.

AT 2.28 PM THE MATTER WAS ADJOURNED SINE DIE

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