Janos and Janos
[2013] FamCA 846
•1 October 2013
FAMILY COURT OF AUSTRALIA
| JANOS & JANOS | [2013] FamCA 846 |
| FAMILY LAW – PROPERTY SETTLEMENT – Concession that contributions of the parties equal to date of separation – consideration of post separation contributions – guarantee secured over family home in relation to husband’s corporate business interests – post separation liquidation of the companies – consideration of loss thereby occasioned to the parties by reason of guarantee being called up and home sold – consideration of husband’s conduct or inaction in relation to the liquidation – minimal asset pool save for capitalised value of husband’s superannuation pension in the payment phase – consideration as to commutation value of the pension occasioned by splitting order – commutation value of superannuation pension included in pool in lieu of capitalised value – consideration of appropriate orders – significant splitting order of husband’s pension in favour of wife – husband to indemnify wife in respect to residual bank liability. |
| Family Law Act 1975 (Cth) ss. 75, 79 |
| Stanford v Stanford [2012] HCA 52 |
| APPLICANT: | Ms Janos |
| RESPONDENT: | Mr Janos |
| FILE NUMBER: | PAC | 2676 | of | 2009 |
| DATE DELIVERED: | 1 October 2013 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Parramatta |
| JUDGMENT OF: | Foster J |
| HEARING DATE: | 26, 27 and 28 August 2013 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Thomas |
| SOLICITOR FOR THE APPLICANT: | King Cain Solicitors |
| COUNSEL FOR THE RESPONDENT: | Mr Gould |
| SOLICITOR FOR THE RESPONDENT: | Harris Freidman |
Orders
That a specified percentage of 80 per cent is allocated, as required by section 90MT of the Family Law Act 1975 to Ms Janos out of Mr Janos’s interest in the State Superannuation Scheme.
That in accordance with paragraph 90MT(1)(b) of the Family Law Act 1975:
(a)Ms Janos is entitled to be paid the amount calculated in accordance with Part 6 of the Family Law (Superannuation) Regulation 2001; and
(b)Mr Janos’ entitlement to payments out of his interest in the State Superannuation Scheme and the entitlement of such other person to whom a splittable payment may be payable is correspondingly reduced by force of this order.
That the Trustee of the Trustee Corporation Pooled Fund (“the Trustee”) shall do all such acts and things and sign all such documents as may be necessary to:
(a)Calculate, in accordance with the requirements of the Family Law Act 1975 and the Family Law (Superannuation) Regulations 2001, the entitlement created for Ms Janos pursuant to these orders; and
(b)Pay the entitlement whenever the Trustee makes a splittable payment out of Mr Janos’ interest in the State Superannuation Scheme.
That these orders have effect from the operative time and the operative time for this order is four business days after service of this order on the Trustee.
That this order binds the Trustee of the State Superannuation Scheme.
That the husband hereinafter indemnify and save harmless the wife from all or any liability to the ANZ Bank arising from the guarantee entered into by the husband and wife and the joint personal loan obtained by the parties from the said Bank.
Liberty to apply as to implementation or enforcement of these orders.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Janos & Janos has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| FAMILY COURT OF AUSTRALIA AT PARRAMATTA |
FILE NUMBER: PAC 2676 of 2009
| Ms Janos |
Applicant
And
| Mr Janos |
Respondent
REASONS FOR JUDGMENT
The Proceedings
These are proceedings for property settlement as between the Applicant wife and the Respondent husband under section 79 of the Family Law Act 1975 (“the Act”).
At trial the Applicant wife relied upon her further amended initiating application filed on 18 May 2012.
In that amended application the wife sought orders in summary that provided for the following:
a)That the husband pay to her the sum of $400,000;
b)That there be a splitting order in relation to the husband’s superannuation entitlement with the State Superannuation Scheme to the effect that 100 per cent of the husband’s entitlement be split in favour of the Wife;
c)That the wife discharge the parties’ joint indebtedness to the ANZ Bank in the sum of approximately $100,000 such indebtedness arising as a consequence of guarantees given by the husband and wife to the said bank in relation to the B Group of companies;
d)That the husband do all things necessary to assign to the wife his interest in ongoing payments received by him from the New South Wales Self-Insurance Corporation.
At trial the husband relied upon his response filed on 9 November 2009.
In that response the husband sought orders that in summary provided as follows:
a)That the husband pay to the wife the sum of $10,000;
b)That upon such payment the wife transfer to the husband her interest in the former matrimonial home at C Town and thereafter the husband indemnify the wife in respect to any liability secured against that home.
At the commencement of the trial in her Outline of Case the wife sought orders that divided the pool of assets as contended for by her as to 65 per cent to the wife and 35 per cent to the husband.
At the commencement of trial in his Outline of Case the husband sought orders that in summary provided:
a)That the wife’s further amended initiating application be dismissed;
b)That the husband and wife equally discharge the parties’ indebtedness to the ANZ Bank arising from the mortgage previously secured over the matrimonial home in relation to the parties’ guarantee as to monies advanced to the B Group of companies and the parties’ joint personal loan from the ANZ Bank.
At the conclusion of the trial and during submissions the husband sought final orders that provided for him to indemnify the wife from all or any liability in relation to the parties’ joint indebtedness to the ANZ Bank arising from the said guarantee and the parties’ joint personal loan.
Background Facts
Cohabitation
The parties commenced cohabitation in mid-1985 and were married in 1989. At the commencement of cohabitation the wife was 21 years of age and the husband 30 years of age.
The wife is presently aged 49 and the husband is aged 58.
At the commencement of cohabitation the wife was in employment as an admissions officer and the husband as a public servant.
At this time the wife owned a motor vehicle subject to an outstanding loan, some furniture and minimal savings. The husband owned a motor vehicle, personal effects and furniture, savings he asserts in the sum of about $10, 000 and accruing superannuation arising from his employment.
There are two children of the marriage the eldest now 20 years of age and the youngest just 18 years of age living in the household with the husband.
There is no issue that during cohabitation the wife was the primary homemaker and carer for the children with the husband helping out when he could when he was home.
In late 2000 the parties separated for a period of about two years with the wife leaving the matrimonial home with the children and residing in rented accommodation. The husband remained in occupation of the family home. In December 2002 the parties reconciled, with the wife returning to live in the matrimonial home with the children
The parties separated in April 2008 with the wife and children of the marriage remaining in occupation of the home. The husband left the home and resided in rented premises near D Town on the NSW Coast.
Following the parties’ separation in 2008 the husband spent regular time with the children on weekends but on such occasions he returned to the family home. The husband paid child support when assessed by the Child Support Agency.
The husband’s regular attendances at the home after separation caused the wife to convert a rear study into a lounge room for herself in order that she had a separate living area away from the husband when he was there contrary to her wishes. In late September 2009 the husband returned to reside in the family home on a full-time basis.
The wife continued to be the primary carer for the children and the primary homemaker within the home. She continued to pay all household outgoings including rates and utilities as well as the day to day living expenses for her and the children.
As a consequence of the stress of the husband returning to live in the home, the wife sought medical assistance. She was prescribed medication for anxiety and depression. The parties remained living under the one roof until April 2010 when the wife left the matrimonial home to reside initially with her brother. The children continued to live in the matrimonial home. At this time the eldest child was almost 18 and the youngest child 16 years of age.
Initial History
In 1991/1992 the parties commenced to construct the matrimonial home on the land purchased by them in C Town. That home was the parties’ matrimonial home until final physical separation in April 2010.
The wife continued in full-time employment until shortly before the birth of the parties’ first child in December 1992. Whilst on maternity leave the wife was made redundant and received a payment of approximately $30,000. These funds were applied by her to the parties’ then mortgage.
Following the birth of the parties’ first child the wife returned to part-time employment with the husband continuing to work full time as a public servant.
The wife ceased employment again some months prior to the birth of the second child in November 1994 due to ill health. Following the birth of the child the wife returned to part-time work three days per week.
The Parties’ Businesses
In about 1995/1996 the husband commenced a business “E Pty Ltd” on a part-time basis as an adjunct to his full-time work as a public servant.
However in July 1997 the husband ceased employment with the public service due to stress related illness following which he commenced to receive ongoing fortnightly Workers Compensation payments through the New South Wales Self-Insurance Corporation.
Following the cessation of the husband’s employment as a public servant he worked in his business full time. The parties subsequently incorporated the business as E Pty Ltd. The parties were the directors and equal shareholders of that company.
In about 1999 the husband’s brother Mr G Janos lent monies to the company. He was not a director or shareholder of the company at this time.
In 1999 the parties incorporated a second company Janos Pty Ltd in respect of which they were the directors and equal shareholders. Later in August 2003 the name of this company was changed to K Pty Ltd (“K”) with the company engaged substantially in land clearing services.
The husband worked predominately away from the C Town district and was often away from the home for extended periods leaving the wife with the primary responsibility for the care of the children.
The name of the company E Pty Ltd was later changed to F Pty Ltd (“F”) in September 2005. This company provided equipment hire services to K.
Following his first heart attack in about 1999 the husband employed his nephew Mr H Janos to assist him in the operations of the companies.
In late 1999 the wife transferred her shareholding in J and F to the husband’s brother, Mr G and resigned as a director of the companies. The circumstances of the transfer are not in issue and it was the wife’s wish to no longer be involved in the companies at this time.
The husband concedes that the companies were not trading strongly at this time but were holding their own and later struggled financially in most years with some improvement in the 2009 financial year. The husband conceded that there had been in 2001 and 2002 applications made to wind up F and in 2001 an application to appoint a liquidator to F. The circumstances of these applications were not made clear.
Following a meeting between the husband, his brother and his nephew in early 2001 the husband’s nephew Mr H was made a director and shareholder of both companies. The husband thereafter held a one third interest in each of the companies. The husband was mainly responsible for the day-to-day running of the business on site and his nephew Mr H for the running of the office, workshop and yard.
In December 2002 the parties reconciled, with the wife returning to live in the matrimonial home with the children. After this reconciliation the wife had nothing to do with the business and trading affairs of the B Group of companies.
The ANZ Bank Guarantee and thereafter
On 4 June 2003 the parties jointly entered into a guarantee that secured monies borrowed by E Pty Ltd (later F) by way of overdraft account with the ANZ Bank. The guarantee was unlimited but the facility had an initial limit of $350,000.
At this time the wife was neither a director nor shareholder of the company. The circumstances as to the wife signing the guarantee are not in dispute and the wife acknowledges that she was advised to seek independent legal advice in relation to the guarantee but declined to do so.
The husband acknowledges that he gave no consideration to taking some steps to protect he and the wife in relation to the funds they had guaranteed with the ANZ Bank. He gave no consideration to seeking some security from the company or its other directors in relation to he and his wife’s primary indebtedness to the bank on behalf of the company. He acknowledged that he should have spoken to the company’s accountant in relation to the circumstances of he and his wife guaranteeing significant loan funds to the company.
In 2006 the company J Pty Ltd (“J”) was incorporated. This company engaged in wholesale sales generated by the activities of K Pty Ltd. The directors of this company were the husband and his nephew Mr H and they held equal shares in the company.
The husband asserts that following the incorporation of J in 2006 the business grew at a healthy rate. However he asserts that none of the shareholders drew a significant income as profits were reinvested into the company as a long-term investment.
Financial statements for the companies reveal that by 30 June 2008 retained profits in K were about $116,000, increasing to about $120,000 by 30 June 2009.
However by 30 June 2008 accumulated losses in F were about $205,000, increasing to about $243,000 by 30 June 2009.
By 30 June 2008 accumulated losses in J were in the sum of about $173,000 with this increasing to about $319,000 by 30 June 2009.
By 30 June 2008 the overdraft facility guaranteed by the parties in relation to F was in debit $353,378 and on 30 June 2009 the overdraft still remained slightly over its limit at $353,816. This appears to be commensurate with the accumulating losses.
Subsequent to leaving the matrimonial home in April 2010 the wife through her solicitors notified the ANZ Bank that she withdrew her consent to any additional increase in the sum secured by the guarantee over the matrimonial home. The wife was informed that the guarantee was unlimited and that the company had sought a temporary increase in the overdraft from $350,000 to $400,000 earlier in April 2010. The wife took no further action to attempt to protect her position as guarantor.
In early 2011 the wife became aware that the husband’s nephew Mr H proposed to refinance the B Group of companies’ debt obligations to the ANZ Bank. However as far as she was aware nothing came of that proposal.
The Liquidation of the B Group of Companies
On 25 March 2011 the B Group of companies, J, K and F were placed into voluntary liquidation as a consequence of a meeting of shareholders on that date. A meeting of the creditors of the companies on 11 April 2011 confirmed the appointment of Mr L as liquidator.
Subsequent to the appointment of the liquidator the husband became aware that his nephew Mr H had been trading under a business name “M Pty Ltd” and through this business had leased vehicles to J and K simultaneously to the effect that the companies were charged twice for the provision of only one vehicle. The husband discovered that all maintenance costs, fuel registration and insurances were being paid by either J or K and not the business entity conducted by his nephew that leased the vehicles to the companies.
It is the husband’s contention that as a consequence of the overcharging by his nephew over a period of time, the B Group of companies were placed into liquidation being unable to pay its debts. The Liquidators Report will be referred to later.
The business operations previously undertaken by the B Group of companies were subsumed into two companies incorporated in early 2010 and owned exclusively by his nephew Mr H. Those companies trade from the same premises previously used by the B Group of companies.
The husband communicated his complaints to the Australian Securities and Investments Commission (“ASIC”) by letter dated 24 February 2011. On 24 March 2011 ASIC responded informing him that their enquiries indicated that there “is an ongoing internal dispute between the various directors and members of the company …. Internal company disputes, where it is open to members to take their own civil action, fail the public interest element...” The husband was informed that he “may wish to seek legal advice”.
The husband sought legal advice and says that he was informed that prospective litigation in relation to the B Group would cost at least $250,000.
Sale of the Matrimonial Home
By letter dated 22 February 2011 the wife received a demand for monies owing pursuant to the ANZ guarantee in the sum of $421,420. The wife then sought the husband’s agreement to sell the matrimonial home to discharge the parties’ indebtedness to the ANZ Bank.
On 21 March 2011 the wife filed an application seeking urgent sale of the matrimonial home in which the husband had continued to reside from April 2010 to her exclusion. On 11 April 2011 the husband consented to orders that facilitated an orderly sale of the matrimonial home.
The sale of the matrimonial home was completed on 11 October 2011. Net proceeds of sale in the sum of $441,537 were payable on settlement and from the proceeds $422,709 was paid to the ANZ Bank in part satisfaction of the parties’ obligations to the Bank under the guarantee and the joint personal loan.
On 14 October 2011 the wife was advised that the balance outstanding to the bank was $98,058 together with interest continuing to accrue. It appears that the husband for his part had simply allowed the debt obligations to the ANZ Bank to capitalise with an ever increasing indebtedness, notwithstanding that he was in occupation of, in effect, an unencumbered home.
Regrettably and notwithstanding requests to do so, the husband has at all times failed to join with the wife in negotiations with the ANZ Bank to seek to minimise their liability to that Bank.
Present circumstances of the parties
In August 2012 the husband suffered a major heart attack and underwent heart bypass surgery on 24 August 2012. The husband presently takes a regime of medication in relation to his heart and other conditions and for pain management.
The husband resides in rented accommodation paying a rent of $350 per week. He shares that accommodation with the eldest child of the marriage who is in employment in the service industry and the youngest child who works in administration. It appears to be his decision to seek no financial contribution from his children to the cost of their accommodation.
The wife presently lives in a de facto relationship. Her partner is employed full-time as a public servant. She resides in his home in respect of which she has no legal or equitable interest. The wife contributes to household expenses. She works in paid employment five days per week and earns an income of approximately $60,000 per annum.
The Personal Loan
On 4 March 2011 the wife received a further Notice of Demand in relation to sum of $60,552 owing to the ANZ Bank in relation to a personal loan borrowed jointly by the parties during cohabitation. The loan was raised to undertake repairs to the matrimonial home.
On 18 April 2007 the proceeds of this personal loan in the sum of $59,000 were drawn down and paid to the parties’ joint Interest Saver account with the ANZ Bank. On 9 May 2007 the sum of $17,380 was withdrawn by card entry by the husband at the D Town branch of the bank and on 18 June 2007 the sum of $8000 was withdrawn by way of card entry by the husband at the C Town branch of the bank. Repairs to the home were not done and the wife says that she is unaware as to how the husband applied the funds.
On 11 April 2008, after separation, the balance of monies standing to the credit of the Interest Saver account was $30,620. On 4 July 2008 there was a withdrawal in the sum of $30,000 by the husband. The wife has no knowledge as to how these funds were applied. The husband acknowledges that these funds were retained by him and applied for his own purposes.
Husband’s Superannuation Withdrawals
By letter dated 14 June 2011, three years after separation, the husband’s solicitors informed the wife that the husband had withdrawn $36,395from his Colonial Super Policy. Those funds were paid by the husband as $15,836 to Capital Finance in respect of his motor vehicle loan and $19,503 to his ANZ Visa credit card.
The letter further advised the wife that the husband had made application for the withdrawal of his First State Super entitlement. The husband in May 2011 withdrew $26,614 from this fund. These funds were applied by the husband to a payment in relation to his credit card debt, his then outstanding taxation liability and a $4000 shortfall arising from the sale of the wife’s car in respect of the loan secured against that vehicle.
The husband was called upon to produce documents evidencing the disposition of funds withdrawn by him from his superannuation. He asserted that his outstanding taxation liability related to the 2007, 2008 and 2009 tax years. His tax return for the 2007 tax year revealed a tax liability of $4063 and for the 2008 year a tax liability of $2847. The reason for non-payment of these sums when due was not given.
Otherwise he was unable to produce any documents relevant to the disposition by him of his superannuation funds in 2011 and in particular any documents that related the amounts allegedly paid by him to the financial circumstances of the matrimonial relationship.
The Husband’s Worker’s Compensation Payments
The husband continues to receive Workers Compensation payments from the New South Wales Self Insurance Corporation. As at 12 May 2012 his payments were in the sum of $514 per week before tax.
The payments are being paid to him pursuant to Section 37 of the Workers Compensation Act 1987 (NSW) that provides for weekly payments during total incapacity after the first 26 weeks.
The amount that the husband receives by way of such Worker’s Compensation payments is subject to the following conditions:
a)Payments will cease at the age of 66 with the husband thereafter being eligible to receive the age pension under Commonwealth law;
b)Payments are subject to review which may result in the weekly payments being reduced, increased or stopped; and
c)Payments received are not capable of being assumed by a third party nor are they assignable or transferable.
It is contended on behalf of the wife that the Court should have regard to a capitalised sum relating to the husband’s future prospective entitlement to these payments. During submissions the wife resiled from this position, acknowledging that the payments should be regarded as a periodic entitlement in the context of s 75(2) considerations.
The husband’s present weekly compensation payments as asserted in his financial statement filed on 22 August 2013 are in the sum of $550 per week before tax.
Value of the Husband’s Fund Pension
The husband is presently in receipt of a superannuation invalidity pension representing his interest in the Trustee Corporation Pooled Fund. By letter dated 30 April 2012 the Administrator of that fund provided a Superannuation Information form in response to a request from the wife.
The husband commenced as a member of the superannuation plan on 2 June 1978.
The Administrator of the fund advised that the value of the husband’s interest in the fund as at 11 April 2012 was $630,171. As at that date the husband’s annual amount of pension was $42,714.81 or $821.42 per week.
The husband in his financial statement relied on at trial asserts that his current pension payment is $900 per week or $46,800 per annum.
As to the husband’s interest in the fund the wife relied upon the affidavits of Mr N. Mr N was not required for cross-examination.
Mr N in his affidavit says:
…a characteristic of the superannuation invalidity pension is that it is paid by the superannuation trustee prior to maximum retirement age but the entitlement continues to be paid after retirement age. This dual component characteristic, suggests that before maximum retirement age is reached, the invalidity pension is paid to replace the husband’s lost income by reason of the husband’s invalidity. The husband may be required to undergo a medical examination and, subject to the result of the examination can be called back to duty if he is found to be no longer incapacitated for work…… Medical reviews cease after the member reaches the age of 55.
……(The relevant legislation) makes provision for facilitating the splitting of the superannuation after the making of a splitting order. The non-member spouse… is entitled to an immediate lump sum payment where the superannuation entitlement is a pension. … There is also a provision for a reduction in payments to be made to the husband.
Mr N in his affidavit values the husband’s pension entitlement at $631,767. That is the value agreed to by the parties.
By letter dated 1 October 2009 the husband was informed by the Trustee that upon him attaining the age of 60 years his pension payments will be tax-free. It appears from the same correspondence that at present a portion of his pension entitlement is subject to tax.
Information comprised in the earlier affidavit of Mr N comprising the fund fact sheet reveals that the husband, not already having done so, has the option to commute all or part of his pension entitlement to a lump sum provided that the election is made within six months of him attaining the age of 60 years.
The husband conceded that he had previously considered commuting part of his pension in the sum of $140,000 and that his next opportunity to commute would be upon attaining 60 years of age.
The pension is commutable to a lump sum at the rate of $250 for each one dollar of the pension. Any portion of the pension not commuted will continue to be paid as an indexed pension entitlement. On the basis of the husband’s current pension entitlement of $900 per week his present indicative commutable lump sum is $225,000 at age 60.
The O Report: Valuation of the B Group September 2009
The wife relied upon the affidavit of Mr O, Senior Chartered Accountant. Mr O was instructed by the wife to value the husband’s interest in the B Group of companies as at 30 September 2009. He valued to husband’s interest at $339,000 at that date.
The valuation is of the companies as at 30 September 2009, which date post-dates separation but pre-dates the liquidation of the companies, the circumstances of which are more particularly set out in the liquidator’s report referred to below.
Mr O asserts in his report that he made use of financial, marketing and forecast information provided by the management of the B Group and its accountants. Nowhere in the report does he set out that information.
The background financial information on which Mr O’s assessment of the husband’s interest in the companies comprises the financial statements for the companies for the financial years ended 30 June 2008 and 30 June 2009.
In an annexure to his report Mr O attaches an email from him to the solicitor for the wife. It appears that the email was sent following completion of the valuation report and that report being provided to the solicitors for the wife. Mr O notes anomalies in relation to the financial ratios and statistics evident to him from analysis of the financial statements presented to him. He says that as part of his valuation process he conducted a benchmarking exercise comparing the actual financial ratios with the ratios prepared by the Australian Tax Office for all companies within the respective industry group. Mr O says that the comparison shows that both the gross profit margins and the net profit margins were well below the industry benchmark. He concludes by saying that it would appear that further explanation and evidence is required from the owners as to the reason behind the variances. He further says that in the absence of further detailed explanation one could assume that some income has not been disclosed in the financial statements. However he says that “without further analysis I am not in a position to make assertions”. He suggests that the wife’s solicitor review this situation thoroughly with their client.
It is apparent that there was no further investigation undertaken as a consequence of the reservations expressed by Mr O. In oral evidence Mr O conceded that he did not go to the business premises, did not speak to the husband in relation to the business and did not speak to the companies’ accountant in relation to the business group. He asserted that the accounts of the Group did not recognise internally generated goodwill in that the business had been operating for 10 years and his assumption was that there were substantial contracts in place. When pressed he conceded that he had not seen any formal contracts between the Group and local councils or other customers.
In the absence of the information identified and analysis referred to the conclusions of Mr O must be approached with caution.
Mr O conceded that adopting a “future maintainable earnings” methodology as to valuation would quite possibly have led to a lower valuation and in circumstances where there had been losses in the previous two years that such a methodology would not generally be appropriate.
Mr O adopts what he calls the “economic value method” of valuation that he says calculates the economic benefit that could be obtained by ownership of the business. His report asserts that this measure is consistent with the value that would be reached in negotiations between a willing but not anxious buyer and a willing but not anxious seller.
In undertaking his evaluation methodology Mr O asserts that he made several adjustments to the year ended 30 June 2009 expenditures in order to get a reasonable starting point for the cost forecasts. There is no calculation set out in the report as to the extent of these adjustments nor any variants derived therefrom in relation to the year ended 30 June 2009 financial statements.
Otherwise he asserts that costs are forecast by increasing the most recent year’s costs, after any adjustments needed to identify reasonable costs. There is no calculation set out in the report as to the extent of any such increase or of any adjustment needed to identify reasonable costs.
Mr O included in his methodology several assumed capital transactions including the business retiring its non-current debt in line with existing loan agreements, capital expenditure as planned by the management of the B Group and major expenditure of $393,000 in future years being financed by new bank debt which would be repaid in equal instalments over a five-year life. There is no evidence supporting such assumptions.
Notwithstanding his conclusion as to valuation Mr O identifies that the shareholders equity in the group as at 30 June 2009 was negative $441,000 and that revenue for the group for the same period was a loss of $180,000.
The report itself identifies fundamental flaws in the pathway to the asserted conclusion. The anomalies identified above were not reconciled, his process of enquiry was truncated and inadequate, he made assumptions not supported by any evidence and made unexplained adjustments to historical expenditures and costs.
The Court can place little weight on the evidence of Mr O.
The Liquidator’s Report: Exhibit F
The Creditors Voluntary Liquidation Report in relation to the B Group of companies dated 31 May 2013 is in evidence.
As to F, the liquidator reports that his appointment was largely due to poor financial control, poor strategic management of the business, cash flow problems and poor economic conditions. The liquidator further reports that the sale of the company’s assets and business in December 2010 to a related entity resulted in the company being unable to generate any future revenue to service its liabilities. The liquidator makes the same conclusions in relation to the companies J and K.
As to F it is to be noted that in relation to the liquidation the husband provided a proof of debt to the liquidator asserting that the sum of $856,400 (presumably including the ANZ guaranteed debt) was payable to him by the company. Similarly proofs of debt were lodged by the husband’s nephew in the sum of $123,900 and the husband’s brother in the sum of $250,227. The Australian Taxation Office was owed the sum of $129,465.
The liquidator notes that the claims by the related parties reflected in the proofs of debt lodged by the husband, his brother and his nephew were not detailed in the company’s balance sheet as at 30 June 2010. Indeed as at 30 June 2009 the debt owed by the company to the husband as at 30 June 2008 in the sum of $20,467 had been paid down to nil, the amount owing to the husband’s brother was $6066 and to the husband’s nephew only $15,513.
As to J it is to be noted that in relation to the liquidation the husband provided a further proof of debt in relation to this company asserting that the sum of $153,172 was owed to him. His nephew lodged a proof of debt in the sum of $25,537. There was an outstanding amount owing to the Australian Taxation Office of $111,866.
It was reported by the liquidator that J in its financial statements as at 30 June 2010 disclosed debts owing to K in the sum of $442,139 and F in the sum of $111,027. As to the absence of plant and equipment and stock the liquidator presumed that such items were taken over by the purchasing entity on sale in December 2010. However the financial statements for J as at 30 June 2009 reveal a sum owing to K of only $86,560 and to F of only $3000.
In relation to K, proof of debts provided to the liquidator reveal the claim by the husband to be owed $353,160, his nephew Mr H $121,758, his brother $143,402 and the Janos Family Trust $126,982. The liquidator also notes the sum of $437,471 owing to F as at 30 June 2010. It is of interest to note that as at 30 June 2009 the financial statements of K disclose a debt to the husband of only $68,652 and to his nephew of only $32,548.
In his oral evidence the liquidator says that he spoke to the husband in relation to the liquidation at an early stage and that the husband was present at the original creditors meeting.
The husband was aware of the circumstances of the liquidation and participated to the extent of providing proofs of debt on his behalf to the liquidator. The husband acknowledges that he received early correspondence from the liquidator in relation to any claim he may have against the companies and as a consequence of that correspondence submitted proofs of debt to the liquidator as referred to above. The basis of his claims as against the companies and the claims of his brother and his nephew are not clear. However by reason of those claims the husband, his brother and his nephew were the overwhelming creditors of the B Group to the extent that the outstanding liability of the group to the Australian Taxation Office was simply subsumed into the liquidation.
The husband’s evidence that he had little to do with the liquidation is not accepted.
It appears that as at the date of the appointment of the liquidator the Australian Taxation Office was owed $241,331 by the B Group of companies.
As a consequence of the liquidation those monies and other claims by the related parties will not be paid. The liquidator will provide a report to ASIC.
The Liquidators Report: Sale of the B Group
The liquidator in his report touches upon the circumstances relating to the disposition of the business and assets of the B Group in December 2010.
The Group sold its assets to a related entity P Pty Ltd as trustee for the Janos Family Trust (“P”). The husband’s nephew Mr H is the sole director and shareholder of P.
A tax invoice dated 8 December 2010 from F to P was provided to the liquidator. The invoice totalled $658,565 including GST and evidenced the purchase by P of all tangible plant and equipment of F.
The liquidator was provided with a copy of a valuation of the assets of F dated July 2010 which valued the assets of F on an estimated realisable auction value at $651,200 and on a market value basis of $1,077,700 plus GST. The assets referred to in the tax invoice were mostly subject to encumbrances by various finance companies and payout figures were stated.
The liquidator reports:
…it appears that upon the sale of the equipment the purchase consideration of $658,565 including GST was paid by way of paying out those financiers that held encumbrances over assets subject to the sale. The total payouts equalled $657,390 being only $1174 less than the total purchase price resulting in no form of material consideration being paid to the company. I note the tax invoice did not detail the sale of any goodwill or intellectual property of the company only tangible assets. Notwithstanding this it appears that the goodwill and dissociated intellectual property of the company was also taken over by [P]…. The sale of the plant and equipment is in line with the auction value of the assets but given the sale occurred on a going concern/market value basis, the assets likely should have been sold at the market value as assigned by [Q Auctions].
The liquidator further reports:
I have received conflicting stories from both directors in relation to the period prior to the sale. [Mr Janos] has advised he was not consulted in relation to the sale of the assets/business of the company and the same was solely orchestrated by [Mr H Janos]. [Mr H Janos] has advised that [Mr Janos] was aware of the sale taking place and he was provided with a copy of the valuation and had indicated at the time he may purchase some assets which did not eventuate. I note on 27 September 2012 [Mr R] and [Mr S] of [T Partners] were appointed jointly as liquidators over [P]…
As to whether the above related party transaction is in the liquidator’s opinion, non-arm’s length or potentially voidable the liquidator concludes:
Prima facie, yes….. The sale was not an arm’s length transaction, i.e. it was to a related party. Notwithstanding this, the sale itself does not lead to the transaction being uncommercial, however, my preliminary view is that the sale may be uncommercial and not in the interests of creditors as a whole. I have formed this view in the light of the following:
- no consideration was paid for the goodwill and intellectual property of the company such as phone numbers and the website
- the value of the assets sold whilst based on a valuation conducted by [Q Auction’s] was based on the auction value and not the market value and
- at the time the transaction took place the company may have been insolvent.
The husband said that his solicitors have written to both his brother and his nephew enquiring as to whether they would be prepared to give evidence in these proceedings. The husband understands that neither his brother nor his nephew wished to assist him in the proceedings. Notwithstanding that position the husband says he has had no contact with his nephew or his brother since late 2011. He has taken no other action to procure evidence from either his nephew or his brother.
The Law
The approach to the determination of an application under s 79 of the Family Law Act 1975 (Cth) is set out in Stanford v Stanford [2012] HCA 52 and that decision was the subject of detailed consideration by the Full Court in Bevan & Bevan [2013] FamCAFC 116.
The Court should firstly identify the present assets, financial resources and liabilities of the parties.
The Court should then consider whether, having regard to the circumstances before it, it would be unjust and unfair not to make orders for alteration of the property interests of the parties having regard to the provisions of s 79(2) of the Act.
The Court can then proceed to consider the contributions by each of the parties as contemplated by s 79(a) – (c) of the Act.
Having determined the contribution-based entitlements of the parties the Court can then consider the various factors set out in s 75(2) of the Act and whether any further adjustment to the parties’ contribution-based entitlements is appropriate.
The Court is then required to consider the justice and equity of the proposed orders and whether in all the circumstances the orders to be made are appropriate.
The Property of the Parties
The Court is firstly required to as a starting point identify the existing legal and equitable interests of the parties in the property, the liabilities and financial resources of the parties at the time of the hearing;
There was no dispute as to the present assets and liabilities of the parties being as follows:
Assets:
Wife Motor vehicle 1 $ 8000
Wife Motor vehicle 2 $ 13,000
Husband Credit Union account $ 279
Husband ANZ Bank account $ 2996
Husband Motor vehicle 3 $ 12,000
Husband Motor vehicle 4 $ 9000
Husband Motor vehicle 5 $ 3000
Husband Household contents $ 3000
Husband Ride on mower $ 1000
Husband Pension $631,767
Wife Caresuper $ 35,766
Wife Super (6/12) $ 17,685
Total: $737,493
Liabilities:
Wife CBA personal loan $ 18,650
Wife CBA MasterCard $ 3830
Joint Debt to ANZ Bank $100,974
Husband Income tax $ 15,964
Husband Credit Union Visa card $ 8475
Husband ANZ MasterCard $ 19,685
Husband Capital Finance debt $ 9911
Husband Capital Finance debt $ 11,712
$189,201
The outstanding balance owing by the parties pursuant to the guarantee executed by them in favour of the ANZ Bank over the former matrimonial home and the outstanding balance of the joint personal loan have been consolidated into the sum of $100,974 presently owing to the ANZ Bank.
The Adjusted Pool
During the course of closing submissions various concessions were made and submissions made as to items to be removed from the list of assets and liabilities set out above for the purpose of the Court considering adjustment orders to be made, if any.
Those items are considered below.
Husband: Income tax $15,964
It is contended by counsel for the wife that, absent appropriate supporting documentary evidence, the Court could not be satisfied that the debt should be included in the asset pool with the effect that the wife would bear some proportion thereof. The husband has adduced no evidence that would warrant the asserted debt being included in the pool to the effect that the wife should bear some portion thereof. He received the income to which the debt relates and should pay the tax. The asserted liability will not be included.
Husband: Credit Union Visa $8475
It is contended by counsel for the wife that absent appropriate supporting documentary evidence the Court could not be satisfied that this debt could be relevantly included in the asset pool for adjustment. That contention was opposed by counsel for the husband but it was alternatively submitted by counsel for the husband that the liability in any event would be taken into account in considering the subjective factors under s 75(2).
The husband has given no evidence that justifies the asserted debt being included in the pool. His expenditure is unexplained. If included in the pool the effect is that the wife would bear some portion thereof. The asserted liability will not be included but will be considered in the context of s 75 (2).
Husband: ANZ MasterCard $19,685
Submissions as to this item were identical to submissions in relation to the previous item. The husband has adduced no evidence that would justify the asserted debt being included in the pool to the effect that the wife should bear some portion thereof. The asserted liability will not be included but will be considered in the context of s 75 (2).
During the course of submissions it was conceded by the parties that other post separation debt unrelated to the matrimonial circumstances should be omitted from an adjusted pool of assets for consideration. These were:
Wife CBA personal loan $18,650
Wife CBA MasterCard $ 3830
Husband Capital Finance $ 9911
Husband Capital Finance $11,712
One Pool or Two?
It is contended on behalf of the wife that the Court should include the capitalised value of the husband’s pension in the asset pool for division.
It was contended on behalf of the husband that the Court should adopt a two pools approach notwithstanding the general concession as to the equality of contributions up to separation and by reason of the particular nature of the underlying entitlement that resulted in a capitalised valuation of $631,767.
The approach to be adopted depends on the circumstances of the particular case (Norbis and Norbis (1986) FLC 91-712).
In the circumstances of this matter the evidence is that the husband’s pension entitlement has a realisable capital value of about $220,000 should he commute his pension to a lump sum at the age of 60. Otherwise the valuation obtained is a capitalisation of a future income stream which if included in the asset pool would result in a distortion in relation to the available assets of the parties for division.
The Court is satisfied that a more just and equitable determination of entitlements would be obtained by including the superannuation pension at its commutation value in the pool for adjustment. The husband is very close to the age where he can commute and any splitting order in favour of the wife will facilitate a commutation of her entitlement to an immediate lump sum in any event.
Accordingly a one pool approach will be adopted.
Just and Equitable to Make Orders?
The Court should determine whether it is just and equitable to make a property settlement order. The Court needs to conclude that it would be unjust or unfair to leave present property rights intact. In many cases this requirement is readily satisfied where the parties are no longer in a marital or de facto relationship and thus, for example, the common ownership or use of property by husband and wife will no longer be possible or the express or implicit assumptions that underpinned existing property arrangements such as the accumulation of assets or financial resources by one for the benefit of both have been brought to an end with the relationship. In particular such a circumstance arises where both parties seek adjustment orders but are unable to agree as to same.
In this matter over the period of the parties’ relationship which was for some 23 years the parties accumulated and dissipated community property and property in their respective names. The strong inference being that such assets were accumulated for the common purpose of providing for their life into the future and in all probability ultimately for their adult children. As a consequence of the parties’ separation and the commencement of proceedings as to property settlement in respect to which both parties seek disparate property adjustment orders identified above the Court is satisfied that it is just and equitable to make orders as to property adjustment under s 79 of the Act.
Assessment of Contributions
Having determined that it is just and equitable to make orders in that it would be unjust or unfair not to, the Court can then consider the contributions made by the parties as defined in s 79(4)(a) to (c).
Both counsel conceded on behalf of their respective clients that contributions by each of the parties to the date of separation are equal.
Post Separation
In this matter the parties separated in 2008 but remained living under the one roof in the matrimonial home until April 2010 when the wife left the home.
Subsequent to separation the wife paid down the parties’ outstanding personal loan as referred to above, the husband later remained in occupation of the notionally unencumbered matrimonial home albeit with one of the children of the relationship who was aged 16 until the home was ultimately sold by reason of the wife’s application to the Court for orders. No adjustment is called for as to these circumstances.
The husband’s financial conduct post separation is to be considered in the context of s 75(2).
Contributions by the parties to hearing should be regarded as equal overall.
Section 75(2)
The Court should then consider the subjective considerations as to the parties by having regard to the provisions of s 75(2) in so far as they are relevant. Such a consideration can include arguments as to asserted add backs, alleged waste by a party or other financial resources that it is contended should be added to the actual pool as notional property or liabilities.
The Adjusted Pool: Contributions, Addbacks or Section 75(2)(o) Adjustments?
The parties were in significant dispute as to a number of items that it was contended should be either added back to the asset pool for the purposes of adjustment or taken into account by reason of the provisions of s 75(2)(o) of the Act.
In summary that these items are as follows:
a)ANZ personal loan funds retained by the husband in the sum of $30,000;
b)The husband’s Colonial Super Retirement Fund monies withdrawn by him in March 2011 in the sum of $36,395 and subsequently dissipated by him and the husband’s First State Superannuation Fund monies withdrawn by him in May 2011 in the sum of $26,614 and subsequently dissipated by him;
c)The payment by the wife after separation of the sum of $12,121 in discharge of the parties’ joint personal loan indebtedness to the ANZ Bank in relation to a swimming pool loan borrowed during cohabitation;
d)A sum by way of add back against the husband or adjustment in favour of the wife by reason of the post separation liquidation of the B Group of companies in the circumstances referred to in detail above that resulted in no benefit to the husband or the parties and the diminution of the available asset pool by reason of the capitalisation of debt to the ANZ Bank and calling up by the ANZ Bank of the parties guarantee secured over the matrimonial home that ultimately led to the sale of that property with no net funds available to the parties.
Ultimately the question of notional add backs or whether circumstances are relevant for consideration under s 79(4) or s 75(2)(o) of the Act is a matter for discretion in all of the particular circumstances of the case, being mindful of the general guiding principle that “add backs” are more the exception than the rule.
As to the items referred to above:
a)ANZ personal loan funds retained by the husband in the sum of $30,000:
The husband acknowledged in his oral evidence that he withdrew the sum representing the balance of available jointly borrowed funds without the consent of the wife and gave no evidence as to the application of those funds by him. The wife remains jointly liable to the ANZ Bank for this additional debt, yet received no benefit from the funds drawn by the husband. As the sum is a precise amount, it is appropriate that that such sum should be a notional add back as an asset of the husband in relation to the ultimate pool of assets found for the purposes of adjustment orders;
b)The husband’s Colonial Super Retirement Fund monies withdrawn by him in March 2011 in the sum of $36,395 and subsequently dissipated by him and the husband’s First State Superannuation Fund monies withdrawn by him in May 2011 in the sum of $26,614 and subsequently dissipated by him:
The husband acknowledged that these funds had been withdrawn by him post separation and in mid-2011. His evidence is that he dissipated those funds for his own purposes. It is conceded that the wife’s contribution to these assets at separation was equal to that of the husband and there is no evidence as to post separation accretion. The sum will be a notional add back in relation to the ultimate pool of assets found for the purposes of adjustment orders;
c)The payment by the wife after separation of the sum of $12,121 in discharge of the parties’ joint personal loan indebtedness to the ANZ Bank in relation to a swimming pool loan borrowed during cohabitation:
These payments had the effect of reducing the liability of the parties to the ANZ Bank. If included in the pool the husband will bear some liability for the debt. It is appropriate to include it in the pool.
d)A sum by way of add back against the husband or adjustment in favour of the wife by reason of the post separation liquidation of the B Group of companies in the circumstances referred to above. The liquidation resulted in no benefit to the husband or the parties and the diminution of the available asset pool by reason of the calling up by the ANZ Bank of the parties’ guarantee that was secured over the matrimonial home. In Kowaliw & Kowaliw (1981) FLC 91-092 Baker J said at 76,645:
If a party has acted in the manner to which I have referred earlier either by:
(a) embarking upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets, or
(b) acting recklessly, negligently or wantonly with matrimonial assets the overall effect of which has reduced or minimised their value,
then such conduct in my view and the economic consequences which flow there from are clearly matters to which the Court may have regard pursuant to the provisions of sec. 75(2)(o)….
It is appropriate to consider the circumstances relating to the husband’s post separation financial conduct, the liquidation of the B Group of companies and the subsequent significant financial detriment suffered by the parties in the context of a consideration of s 75(2)(o) of the Act.
As a consequence of concessions made and the findings referred to above the Court is satisfied that the adjusted pool is as follows:
Assets:
Wife Motor vehicle 1 $ 8000
Wife Motor vehicle 2 $ 13,000
Husband Credit Union account $ 279
Husband ANZ bank account $ 2996
Husband Motor vehicle 3 $ 12,000
Husband Motor vehicle 4 $ 9000
Husband Motor vehicle 5 $ 3000
Husband Household contents $ 3000
Husband Ride on mower $ 1000
Husband Superannuation withdrawals $ 63,009
Husband Super Commutation $220,000
Husband ANZ loan withdrawal $ 30,000
Wife Care Super $ 35,766
Wife Super $ 17,685
Total: $418,735
Liabilities:
Joint ANZ loan paid by wife $ 12,121
Joint Debt to ANZ Bank $100,974
TOTAL $305,640
Other Section 75(2) Considerations
The Court has had regard to all of the factors but particularly to each of the considerations set out below as relevant:
The parties’ age and health
The wife is presently aged 49 years and is in good health.
The husband is presently aged 58. He has a complex history of psychological trauma as a consequence of a workplace incident when employed as a public servant. As a consequence of the incident his employment was ended in about 1998 and he has been in receipt of periodic Workers Compensation payments ever since as referred to above. However whilst incapacitated for work as a public servant he exhibited over a period of years a capacity for the physical and other work whilst engaged in the B Group business entities.
Otherwise the husband has over a period of years suffered heart problems and more recently has undergone bypass surgery. He is on a regime of medication in relation to both his underlying heart condition and his ongoing mental health issues. The husband has a diminished capacity for employment.
Income and resources of the parties
The Court has had regard to the present assets, financial resources and liabilities of the parties as set out above.
The wife is working five days per week with an income of about $60,000 per annum. It appears that she is in secure employment. Otherwise the wife’s resources comprise the asset pool identified above.
The husband is in receipt of Workers Compensation payments in the sum of about $28,600 per annum and his pension in the sum of $46,800 per annum. These sources of income total $75,400 per annum in respect to which he pays tax at a reduced rate. He asserts no capacity for employment otherwise. Yet he adduces no evidence as to why following recovery from heart surgery he has not sought some form of employment.
The parties have otherwise incurred other debts and liabilities post separation unrelated to the matrimonial circumstances that are referred to above. They will each retain those liabilities.
The parties’ superannuation
The wife has modest entitlements in accumulation superannuation funds that will increase over time with statutory contributions. The husband at least in the foreseeable future will not accrue any. The husband has his pension indexed for life. This has been considered above. The capitalised value of the pension is significantly in excess of its realisable value on commutation.
Commitments of the parties for self-support
The pension income stream represents a significant portion of the husband’s present unearned income stream. His prospects of employment have been considered above. A splitting of the pension would result in a commuted sum being rolled over to the wife’s nominated fund with a commensurate reduction in the husband’s ongoing pension entitlements. The husband will continue to receive Workers Compensation payments until the age of 66 with his remaining pension payable on an indexed basis for life.
Creditor’s rights
The parties are jointly indebted to the ANZ Bank. The husband proposes to indemnify the wife in regard to that debt. Neither party has or will have significant assets to meet the claim of the Bank other than superannuation that is a protected class of assets. The husband will be required to come to appropriate terms with the Bank as to the liability. Should he default in that obligation and the Bank pursue the wife then she will have to come to terms with the Bank and seek to recover from the husband her ultimate liability. The proposed order as to the husband’s indemnity of the wife does thus not affect the Bank’s rights to recover its debt in all the circumstances from both parties;
Cohabitation with another
The wife resides in a defacto relationship. Her partner owns the home they live in and is in gainful employment. The inference is that the wife has some security in this relationship.
Any other fact or circumstance: section 75 (2)(o)
The husband’s continuing occupation of the home making or procuring no payments in relation to the ANZ liability and his delay in consenting to a sale of the home inevitability caused the parties’ ultimate liability to the ANZ Bank to increase as the debt continued to capitalise.
The husband was in receipt of income from his Workers Compensation payments and his pension. The husband advanced to the business entities significant capital sums in the period immediately before the liquidation resulting in moneys allegedly owing to him by the companies at the time of the liquidation as referred to above. The source of these funds of the husband’s as asserted to the liquidator is a mystery. Certainly none of the funds available to the husband and advanced by him to the companies as claimed in the liquidation were applied to reduce the exposure of the parties to the ANZ Bank.
The wife asserts that the liquidation was undertaken to defeat her property claim. The strong inference arising from the liquidation is that the B Group avoided its significant liability to the ATO and that this was the primary consideration in the initial shareholders winding up and later creditors meeting in which the husband participated.
During this post separation period the husband made no effort to make any repayments to the ANZ Bank in relation to the debt guaranteed by the parties nor to procure any such payments from the B Group. He made no payments in regard to the joint personal loan notwithstanding that he drew down funds particularly the later sum of $30,000.
The husband was at worst reckless in his regard for the parties’ liability to the ANZ Bank and at best negligent in failing to seek to protect in some way the primary matrimonial asset pledged for the benefit of the B Group from being called upon. In reality he did nothing.
The wife contends for an adjustment in her favour by reason of his conduct (or lack of it) in regard to the ongoing capitalisation of the parties’ liability to the ANZ Bank. In her assertion he allowed a valuable asset being their home to be lost and he having been more diligent could have reduced the parties’ ultimate loss.
The husband has proposed that he assume liability for the ANZ debt to the extent of indemnifying the wife; the Court is satisfied that such an order is appropriate. However the substance of such an indemnity is doubtful by reason of the husband’s income and assets available to meet any call by the Bank, thus exposing the wife to prospective liability. It is appropriate to order that the husband pay the debt.
Overall these s 75(2) factors, particularly the last considered and notwithstanding the indemnity, call for an adjustment to contributions as to 10 per cent in favour of the wife.
Overall
As to the property pool and excluding the ANZ Bank debt that pool should thus be adjusted as to 60 per cent to the wife and 40 per cent to the husband.
Justice and Equity: Appropriate Orders
The property pool is:
Assets:
Wife Motor vehicle 1 $ 8000
Wife Motor vehicle 2 $ 13,000
Husband Police Credit Union account $ 279
Husband ANZ Bank account $ 2996
Husband Motor vehicle 3 $ 12,000
Husband Motor vehicle 4 $ 9000
Husband Motor vehicle 5 $ 3000
Husband Household contents $ 3000
Husband Ride on mower $ 1000
Husband Superannuation withdrawals $ 63,009
Husband Super Commutation $220,000
Husband ANZ loan withdrawal $ 30,000
Wife Caresuper $ 35,766
Wife Super $ 17,685
Total: $418,735
Liabilities:
Wife ANZ Personal loan repaid $ 12,121
$406,614
The wife is entitled to 60 per cent of this pool in the sum of $243,968. She has in her possession or entitlement:
Wife Motor vehicle 1 $ 8000
Wife Motor vehicle 2 $ 13,000
Wife Caresuper $ 35,766
Wife Super $ 17,685
$ 74,451
and has the notional liability of the ANZ loan $ 12,121
$ 62,330
The husband is required to pay her the further sum of $181,638. This can only be achieved by either making a cash adjustment order in favour of the wife in circumstances where the husband has no capacity to pay and the wife little prospect on that basis of enforcement or, splitting the requisite sum from the husband’s superannuation by way of commutation with the wife being required to rollover same to her fund until she can access it when entitled. Until such time it will accrue interest. The Court will make the requisite percentage splitting order as to 82.5 per cent resulting in a commuted sum of about $181,600.
The husband will also retain the primary liability to the ANZ Bank and indemnify the wife in regard to that debt.
The Court is satisfied that the resultant outcomes are appropriate and just and equitable in all the circumstances and as best as can be achieved determine the financial relationship between the parties and avoid further proceedings between them.
The Court will make orders accordingly.
I certify that the preceding one hundred and eighty-two (182) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Foster delivered on 1 October 2013
Associate:
Date: 1 October 2013
Key Legal Topics
Areas of Law
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Family Law
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Statutory Interpretation
Legal Concepts
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Jurisdiction
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Statutory Construction
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Remedies
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Injunction
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