Ives and Ives
[2011] FMCAfam 425
•7 June 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| IVES & IVES | [2011] FMCAfam 425 |
| FAMILY LAW – Property settlement – significant initial contributions by wife – children in the predominant care of the wife. |
| Family Law Act 1975, ss.75(2), 79(2), 79(4) |
| Hickey v Hickey (2003) FLC 93-143 Williams & Williams [2007] FamCA 313 |
| Applicant: | MS IVES |
| Respondent: | MR IVES |
| File Number: | MLC 8910 of 2010 |
| Judgment of: | Riley FM |
| Hearing dates: | 2 and 3 May 2011 |
| Date of Last Submission: | 3 May 2011 |
| Delivered at: | Melbourne |
| Delivered on: | 7 June 2011 |
REPRESENTATION
| Counsel for the Applicant: | Ms Smallwood |
| Solicitors for the Applicant: | Pearsons Barristers & Solicitors Pty Ltd |
| Counsel for the Respondent: | Mr Grant |
| Solicitors for the Respondent: | Malkoun & Co Lawyers |
ORDERS
The matrimonial home situated at [Property K] in the State of Victoria be forthwith sold altogether out of Court and the proceeds of sale be applied as follows:
(a)firstly, to pay the agent’s commissions and expenses associated with the sale;
(b)secondly, to discharge the mortgage;
(c)thirdly, to discharge the ANZ visa card liability of $1,700; and
(d)fourthly, the balance to be divided between the husband and the wife on the basis that the wife is to receive 72.5% of the asset pool, taking into account the agreed value of the items to be kept by the wife.
In the event that the parties cannot agree within seven days on the identity of the agent who is to be engaged to sell the said property, then the President of the Real Estate Institute of Victoria be engaged for the purposes of appointing an agent.
The husband do all such things and sign all such documents as may be required to transfer to the wife at the expense of the wife all of his right, title and interest in the Ford Escape motor vehicle currently registered in his name and in the wife’s possession.
ORDERS BY CONSENT
The wife retain for her sole use and benefit, and to the exclusion of the husband, her interest in the property at [Property C].
The husband and wife each retain for his or her sole use and benefit, any shares held in his or her name.
The wife discharge the loan in respect of the Ford Escape motor vehicle contemporaneously with the receipt by the wife of the payment referred to in order 1(d) hereof.
Unless otherwise specified in these orders:
(a)the parties retain all superannuation and work related benefits in which they have an interest to the exclusion of the other;
(b)the parties retain any shares and the proceeds of any bank accounts in their respective names;
(c)the parties assume sole responsibility for any debts or liabilities in their respective names; and
(d)the parties retain all other property in their possession as at the date of these orders.
IT IS NOTED that publication of this judgment under the pseudonym Ives & Ives is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
MLC 8910 of 2010
| MS IVES |
Applicant
And
| MR IVES |
Respondent
REASONS FOR JUDGMENT
Introduction
The parties were married [in] 1996. They had two daughters, one of whom is now 11 years old and the other is now 9 years old. The parties separated under the one roof on 12 February 2010. The wife left the former matrimonial home on 17 April 2010 with the children. They now live in a unit previously owned by the wife.
The legislation
Section 79 of the Family Law Act1975 (“the Act”) defines the court’s powers in determining applications for property settlement. Sub-section 79(2) of the Act provides that:
The Court shall not make an Order under this Section unless it is satisfied that, in all the circumstances, it is just and equitable to make the Order.
Section 79(4) of the Act sets out the matters the court must take into account when considering what orders should be made for the alteration of the interests of the parties in property. Those matters are:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
The matters to be taken into account under s.75(2) of the Act are as follows:
(a)the age and state of health of each of the parties; and
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support: and
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i) any law of the Commonwealth, of a State or Territory or of another country; or
(ii) any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia; and
and the rate of any such pension, allowance or benefit being paid to either party; and
(g) where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party’s role as a parent; and
(m)if either party is cohabiting with another person—the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
(na) any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
The four step approach
In Hickey v Hickey (2003) FLC 93-143 at [39], the Full Court of the Family Court described the preferred four step approach in property matters as follows:
The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of s.79. That approach involves four inter-related steps. Firstly, the Court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing. Secondly, the Court should identify and assess the contributions of the parties within the meaning of ss.79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Thirdly, the Court should identify and assess the relevant matters referred to in ss.79(4)(d), (e), (f) and (g), ("the other factors") including, because of s.79(4)(e), the matters referred to in s.75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two. Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case ….
STEP 1: The assets and liabilities
The parties agreed that their assets, superannuation and liabilities were as follows:
ASSETS
VALUE
[Property K]
$1,100,000
[Property C]
$575,000
Shares:
(a) 1,200 Telstra shares in the husband’s name - $3,744
(b) 1,200 Telstra shares in the wife’s name - $3,744
(c) 1,800 NIB shares in the wife’s name - $2,358
(d) 1,102 ANZ shares in the wife’s name - $24,761
$34,607
Ford “Escape” motor vehicle driven by the wife and registered in the husband’s name valued at $25,000 with a loan of $25,000
NIL
Ford 2002 station wagon motor vehicle registered in the husband’s name
$8,000
Funds held in ANZ bank at time of separation
$20,173
Trailer
$500
Trail Bike
$900
TOTAL ASSETS
$1,739,180
LIABILITIES
Mortgage on [Property K]
$287,000
ANZ Visa Card
$1,700
TOTAL LIABILITIES
$288,700
ASSETS LESS LIABILITIES
$1,450,480
SUPERANNUATION
Wife’s superannuation with [C]
$66,358.25
Husband’s superannuation funds:
[B] Super
[A] Super
$25,408.46
$8,539.82
TOTAL SUPERANNUATION
$100,306.53
NET ASSETS PLUS SUPERANNUATION
$1,550,786.53
In addition, the wife claimed that there should be an add back of $3,014.56 which the husband withdrew from the Ford Escape car loan on 27 September 2010. The husband agreed that he did withdraw that sum but said that it should not be added back. The husband said that there should be an add back of $12,000 which the wife had used to pay legal fees. The wife said that amount should not be added back because it was part of the $20,173 in the ANZ bank at separation which she had used and which she conceded should be added back and placed on her account.
In relation to the $3,014.56, the husband conceded that he had used it for living expenses. His financial statement discloses that he earns about $1,000 per week, although, in cross examination, it was established that he earns more than that. The husband did not indicate why he needed any extra funds to meet his living expenses. He did not suggest that he needed extra funds for any unusual purpose. In the circumstances, I consider that the $3,014.56 should be added back and placed on the husband’s account.
In relation to the $12,000, the evidence was that the wife had paid the $12,000 in legal fees from the $20,173 in the ANZ account. She said that she had used the balance of that sum on living expenses after separation. As the wife conceded that the whole $20,173 should be added back on her account, there is no basis to add back the $12,000 again.
The net asset pool
Consequently, the net asset pool consists of:
a)the assets listed above $1,739,180 plus
b)the add back of $3,014.56 less
c)the liabilities listed above $288,700.
That gives a net asset position of $1,453,494.56.
Additionally, there is superannuation totalling $100,306.53. If that is notionally included in the asset pool, the net asset position is $1,553,801.09.
Financial resources of the parties
It was not suggested that the parties’ have any financial resources other than their assets and earnings, except that the wife conceded that she had borrowed about $10,000 from her brother. That sum was not mentioned in her financial statement as a debt. It is not clear when or if it has to be repaid.
STEP 2: Contributions
Initial contributions
It was common ground that at the commencement of the relationship the wife owned the unit at [Property C] which was unencumbered. It now has an agreed value of $575,000 and continues to be unencumbered. It represents about 37% of the value of the asset pool including superannuation.
It was also common ground that at the commencement of the relationship, the husband and wife each owned a car. There was no focus on the respective values of the cars. I will proceed on the basis that they were of more or less equal and modest value.
The husband initially claimed that he had brought $45,000 to the marriage. However, the wife produced records indicating that the amount was actually $20,421. The husband did not ultimately dispute that figure.
Contributions during the marriage
The wife claimed that she contributed $55,000 during the course of the marriage in the form of a gift from her parents which was used to help with the cost of building the matrimonial home. The husband disputed the quantum and disputed that the money, if any, had been used for the parties’ joint benefit. The wife produced bank records from 2004 showing that the $55,000 had been transferred from the wife’s father’s bank in Greece to the parties’ everyday savings account. However, the wife did not produce the bank statements of the everyday savings account for the subsequent period.
The husband argued that the wife could have immediately withdrawn the money from the parties’ everyday savings account and used it for her own private purposes. I do not accept that argument. The wife appeared to me to be a credible witness. The parties’ marriage continued for about six years after the gift. The parties seem to have been a couple who both made a solid contribution to the joint matrimonial endeavour. It would be surprising, in such circumstances, if the wife had secretly taken $55,000 many years before separation for some unspecified private purpose. I find that the wife did contribute the gift of $55,000 to the joint matrimonial assets, primarily, the former matrimonial home.
The parties lived in the unit contributed by the wife until 2006, when the former matrimonial home was built. The wife’s contribution of the unit meant that the parties did not have to pay rent or a home loan until 2006, and were able to save more than they otherwise might have for the purpose of buying the former matrimonial home. After the parties moved into the former matrimonial home in 2006, the parties received rental from the unit of about $320 per week.
The wife worked part time, except for a short time around the births of the two children. The wife was their primary carer.
The husband worked full time and earned considerably more than the wife. He claimed to have contributed $35,000 in the form of a gift from his parents for the building of the former matrimonial home. The wife said the gift from the husband’s parents was $1,000. The husband provided no documentary evidence to support his claim. He did not call his one surviving parent to corroborate his claim and did not offer any explanation for not calling that witness.
The husband did not impress as a credible witness. He initially claimed that he wished to refinance, buy out the wife and keep the former matrimonial home “for the children”. However, after an extensive cross examination, the husband conceded that he wished to sell a half share of the former matrimonial home to his brother, who is a builder, for the purposes of redeveloping the block with units. The husband conceded in evidence that he had been “completely dishonest” with the court concerning his intentions in relation to the former matrimonial home.
In these circumstances, I do not accept that the husband was telling the truth when he made the completely unsubstantiated claim that he had contributed to the matrimonial assets a gift from his parents of $35,000. I accept that the husband’s parents gave the husband $1,000 as the wife conceded.
Otherwise, the parties both seem to have made solid and equal contributions to the matrimonial endeavour.
Post separation contributions
After separation, the husband continued to live in the former matrimonial home. There was a mortgage over the property of about $287,000. The husband since separation has made the mortgage repayments of about $2,000 per month.
The wife after separation lived rent free in the unit she had owned since before the marriage. The wife has the care of the children of the marriage for 12 nights out of 14, and has been receiving $100 per week in child support from the husband.
Contribution based adjustment
The wife submitted that she had a contribution based entitlement of 65%, based on her contribution of the unit, which is now worth $575,000, and the $55,000 her parents gave her in 2004. Those two items total $630,000, out of an asset pool of $1,553,801.09, including superannuation. The wife’s contributions, over and above her ordinary contributions, amount to about 40% of the asset pool, including superannuation.
The husband said that the wife’s greater financial contributions should result in an adjustment to her of about 57.5% or 60%. He said that, after a 14 year marriage, the initial contribution of the unit, and the early contribution of the $55,000, had somewhat diminished in significance.
The husband referred to the decision of the Full Court of the Family Court in Williams & Williams [2007] FamCA 313. In that case, the court said:
26.We think that there is force in the proposition that a reference to the value of an item as at the date of the commencement of cohabitation without reference to its value to the parties at the time it was realised or its value to the parties at the time of trial, if still intact, may not give adequate recognition to the importance of its contribution to the pool of assets ultimately available for distribution towards the parties. Thus where the pool of assets available for distribution between the parties consists of say an investment portfolio or a block of land or a painting that has risen significantly in value as a result of market forces, it is appropriate to give recognition to its value at the time of hearing or the time it was realised rather than simply pay attention to its initial value at the time of commencement of cohabitation. But in so doing it is equally as important to give recognition to the myriad of other contributions that each of the parties has made during the course of their relationship.
27.In Pierce v Pierce when speaking of the relevance to be paid to initial contributions the Full Court (Ellis, Baker and O’Ryan JJ) referred to Fogarty J in Money v Money (1994) FLC 92-485 at 81,054; (1994) 17 Fam LR 814 at 816:
...respective contributions of the parties over a long period of marriage “offset” the significance which might otherwise be attached to a greater initial contribution by one party...ultimately, when it comes to the trial such a contribution is one of a number of factors to be considered. The longer the marriage the more likely it is that there will be latter factors of significance and in the ultimate the exercise is to weigh the original contribution with all other, later, factors and those later factors, whether equal or not, may in the circumstances of the individual case reduce the significance of the original contribution.
28.The Full Court (Ellis, Baker and O’Ryan JJ) then said at [28]:
In our opinion it is ... a question of what weight is to be attached, in all the circumstances, to the initial contributions. It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and the wife. In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use made by the parties of that contribution.
29.Pierce v Pierce was a case in which the husband brought in $200,000 cash into the relationship. He applied that money towards the purchase of a matrimonial home. He was employed throughout the marriage and supported the wife who, whilst in some paid employment primarily attended to domestic tasks and taking care of the children. The Full Court assessed the parties’ respective contributions to a pool of $320,000 as 70 per cent in favour of the husband and 30 per cent in favour of the wife at the end of a 10 year relationship.
By my calculation, the husband in Pierce contributed 62.5% to the asset pool, based on the initial value of the contribution and the current value of the pool, but was found to have a contribution based entitlement of 70% after a 10 year marriage. That result might be explained by a $200,000 fund having been worth relatively more
10 years prior to trial than it was at trial. In any event, the authorities make it clear that it is necessary to examine all of the circumstances of the case.
In the present case, the wife contributed an unencumbered asset. The husband did not contribute to its acquisition or retention, except perhaps in the form of some relatively minor works. On the other hand, the husband and the wife, and their children, were able to live in the unit rent free and mortgage free for many years. That enabled them to save for the former matrimonial home. The unit also gave the parties rental income of $320 per week after they moved into the former matrimonial home in 2006.
The unit was not an asset like a gold bar that quietly sat in a safe increasing in value. The unit presumably did increase in value significantly between the marriage in 1996 and separation in 2010. However, the unit was also utilised by the parties day by day, to provide them with free accommodation and then an income stream. As such, the unit represents a contribution not only of a capital asset, but it also represents a contribution of an ongoing daily benefit. I would also note that the $55,000 contributed in 2004 would be worth more in today’s money, and has been well utilised by being invested in the former matrimonial home.
As a rough cross check, if the dollar value of the wife’s extra contributions ($630,000) is deducted from the total asset pool, including superannuation (about $1,555,000) it leaves $925,000. Dividing that by two, to reflect the contributions otherwise being equal, would give each party $462,500. Adding the wife’s $630,000 to that would give $1,092,500, or about 70% of the asset pool including superannuation.
I also note the husband’s initial contribution of about $20,000.
Taking into account all of the circumstances of this case, including a reasonable reduction in the significance of the wife’s early extra contributions to allow for the passage of time, I consider that the wife’s contribution based entitlements are 62.5% of the asset pool, including superannuation.
STEP 3: The other factors: s.75(2) etc
As to the effect of any proposed order upon the earning capacity of a party to the marriage, the parties have agreed that the children will spend 12 nights out of 14 with their mother. That is not pursuant to an order as such. However, it is convenient to deal with the issue at this point. The mother said that, since the children were born, she has worked part time, to facilitate their care after school. The mother is presently working about 28 hours per week as a [omitted]. She said she could work an extra day if it was offered to her. That would take her working hours up to about 36 hours per week, which is close to full time. Accordingly, I do not consider that the arrangements for the children greatly affect the earning capacity of the mother, or the father for that matter.
There appear to be no other orders under the Act affecting either of the parties or the children.
As to child support, the husband was paying the wife $100 per week by agreement for child support. However, the wife has now lodged an application for assessment. The husband has been assessed to pay $131 per week for child support, with effect from 14 April 2011. The husband is employed. It seems likely that the assessed amount will be paid by the husband to the wife into the future.
As to the s.75(2) factors, the husband is 40 years old and the wife is
39 years old. They both appear to be in good health. They both have the physical and mental capacity for appropriate gainful employment. Their financial resources are as mentioned above. Their property is yet to be determined, but it is envisaged that the wife will keep the unit, each party will keep his or her superannuation, a car, and the shares held in his or her name.
The wife in her financial statement sworn on 15 April 2011 said that she had an average weekly income of $788, consisting of $508 gross salary, $28 share dividends, $111 family tax benefit A, $47 family tax benefit B and $100 child support. The wife in her financial statement sworn on 17 September 2010 said that she had a weekly salary of $593. She said her salary had dropped because the [workplace omitted] where she worked took on extra part time staff. I accept that evidence. The wife presented as a truthful witness.
The husband in his financial statement sworn on 23 November 2010 said that he had a total average weekly income of “Approx 1,000” consisting of gross wages. The husband’s tax returns for 2008, 2009 and 2010 were tendered (exhibit 3). They show taxable incomes of $54,498, $62,818 and $61,110 respectively. Those figures translate to $1,048.03, $1,208.03 and $1,175.19 per week. The husband said that he had just given approximate figures. However, clearly, the husband’s financial statement gave a significant understatement of his weekly income. The discrepancy of $175, for the most recent financial year, is nearly twice as much as the husband has been paying in child support and is considerably more than the assessed amount of child support that he will pay in the future. This reinforces the view that the husband was not an entirely credible witness.
The wife has the care and control of the two children of the marriage who are 11 and 9 years old. It was not suggested that the husband and wife have a duty to maintain any one other than their children. The husband is complying with his duty to maintain the children by paying $131 per week child support. The wife’s financial statements indicate that she spends $750 per week for the children. She said that she is able to do so by drawing on capital and borrowings from her brother. The wife said that, in the future, she expected to receive a cash sum as part of the property settlement that would enable her to continue spending the same amount on the children. That seems to me to be plausible and I accept the wife’s evidence on this point.
The wife receives income tested benefits, being family tax benefit A and family tax benefit B. In accordance with s.75(4) of the Act, the court is required to disregard those amounts when exercising the jurisdiction under s.74 of the Act to award spousal maintenance. It seems that those amounts are not to be disregarded in proceedings under s.79 of the Act. It was not suggested that the parties are otherwise entitled to an income tested pension, allowance or benefit.
In all the circumstances of this case, a reasonable standard of living for the parties would be about average by Melbourne standards. It is not proposed that either party will undertake a course of education or training. It was not suggested that any of the proposed orders would impact on any creditors. The marriage lasted 14 years. It reduced the wife’s earning capacity to a fairly small extent, given that she continued to work throughout the marriage, except for a short time around the births of each child. The wife wishes to continue her role as a parent, 12 nights a fortnight, and work a little less than full time hours to accommodate that.
It appears that neither party is cohabiting with another person. The property settlement is yet to be determined. It is not suggested that either party might be subject to a de facto property settlement. Child support has already been discussed. It was not suggested that either party is subject to a binding financial agreement. It was not suggested that the court should take into account any other facts or circumstances.
The wife submitted that the “future factors” entitled her to a further adjustment of 10%. The husband submitted that the “future factors” entitled the wife to an adjustment of 5%.
The husband’s counsel argued that the adjustment frequently made in favour of the party who has the bulk of the care of young children is not intended to be a compensation for the costs associated with caring for children, but is intended to compensate for the effort involved in caring for them, in the sense of putting them to bed and so on. I am not sure that is correct. But, on any view, there needs to be a substantial adjustment in favour of the wife as she will be caring for the two children of the marriage for 12 nights out of 14. The children are only 11 and nine years old, so there are many years of caring for them ahead.
The husband’s counsel also argued that the discrepancy between the wife’s earning capacity and the husband’s was not so great, when one takes into account the fact that she could work one more day a week than she is presently, and taking into account her family tax benefit A and family tax benefit B. If the wife did work an extra one day a week, being five days rather than four, her salary could be expected to increase by about a quarter, or about $127 per week, making a total of about $915 per week. The husband earns about $1,175 per week, or about $260 per week more than the wife would earn if she worked an extra day per week. The sum of $260 is about 28% more than $925, being about the amount the wife would earn if she did work an extra day per week. On any view, that is a significant difference.
Taking into account all relevant matters, in my view, the adjustment in favour of the wife for the “future factors” should be 10%.
STEP 4: What order is just and equitable
Taking together the two adjustments, the result is an adjustment of 72.5% in favour of the wife in respect of property and superannuation. Applying that adjustment to the asset pool, including superannuation, bearing in mind the items that are to be retained by each party, would work out as follows:
ASSETS TO BE KEPT BY THE WIFE
VALUE
[Property C]
$575,000
Shares:
1,200 Telstra shares - $ 3,744
1,800 NIB shares - $2,358
1,102 ANZ shares - $24,761
$30,863
Ford “Escape” motor vehicle
NIL
Funds held in ANZ bank at time of separation
$20,173
TOTAL ASSETS TO BE KEPT BY WIFE
$626,036
PLUS WIFE’S SUPERANNUATION
Wife’s superannuation with [C]
$66,358.25
TOTAL OF WIFE’S ASSETS PLUS SUPER
$692,394.25
ASSETS TO BE KEPT BY THE HUSBAND
1,200 Telstra shares
$3,744
Ford 2002 station wagon motor vehicle
$8,000
Trailer
$500
Trail Bike
$900
Add back
$3,014.56
TOTAL ASSETS TO BE KEPT BY HUSBAND
$16,158.56
PLUS HUSBAND’S SUPERANNUATION
[B] Super - $25,408.46
[A] Super - $8,539.82
$33,948.28
TOTAL OF HUSBAND’S ASSETS PLUS SUPER
$50,106.84
ASSETS TO BE DETERMINED
[Property K]
$1,100,000 less mortgage of $287,000
$813,000
If the wife is to receive 72.5% of the asset pool plus superannuation, she would be entitled to a total of 72.5% of $1,553,801.09, or $1,126,505.79. I consider that amount to be just and equitable in all of the circumstances of this case.
Whether the house should be sold
It is intended that the wife will keep assets and superannuation to a value of $692,394.25. Consequently, she would need to receive from the value of the matrimonial home $434,111.54, to make her share 72.5%. There was some debate at the hearing about whether the husband should be given the sixty days that he sought to refinance to enable him to buy out the wife from the matrimonial home. However, as discussed above, the husband conceded that his claim that he intended to keep the house was dishonest. He in fact hopes to sell a share of the block to his brother and redevelop the land.
It is clear that the husband would not be able to refinance to the necessary degree unless he sold a share of the land. The mortgage is presently $287,000. Adding to that figure the $434,111.54 that will be paid to the wife gives $721,111.54. At an interest rate of 7% per year, that would require interest repayments of over $50,000 per year. The husband is not able to meet such repayments on his income. It is inevitable that the house will have to be sold. I do not consider that there is any justification for delaying the sale.
There was also debate at the hearing about whether the wife should receive a particular sum from the proceeds of sale or a particular proportion. In my view, it is fairer to both parties for the wife to receive a particular proportion of the proceeds of sale, after payment of the expenses and liabilities. That way, the parties will share equally in the consequences of any vagaries in the market. There will be orders accordingly.
I certify that the preceding fifty-three (53) paragraphs are a true copy of the reasons for judgment of Riley FM
Date: 7 June 2011
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