Jenkins and Anor and Cowper
[2015] FCCA 357
•27 February 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| JENKINS & ANOR & COWPER | [2015] FCCA 357 |
| Catchwords: FAMILY LAW – Property – de facto relationship – dispute as to the length of the relationship – contributions – property adjustment – just and equitable. |
| Legislation: Family Law Act 1975, ss.4AA, 90SB, 90SF, 90SM |
| Cases cited: Fenton & Marvel [2013] FamCAFC 132 Dahl & Hambly [2011] FamCAFC 202 Pavey & Pavey (1976) FLC 90-051 Greenwood v Merkel [2004] NSWSC 43 Hayes v Marquis [2008] NSWCA 10 Stanford v Stanford [2012] HCA 52 Hickey v Hickey & Attorney-General of the Commonwealth (Intervener) (2003) FLC 93-143 C & C (2005) FLC 93-220 HDM & MM & SJM [2006] FamCA 47 Kowaliw & Kowaliw (1981) FLC 91-092 Weir & Weir (1993) FLC 92-338 Luciano & Luciano (2000) FamCA 401 (non-reportable), O’Ryan Aleksovski & Aleksovski (1996) FLC 92-705 Sippel & Sippel [2004] FamCA 201 Norbis & Norbis (1986) 161 CLR 513 Parshen & Parshen (1996) FLC 92-720 Pierce & Pierce (1999) FLC 92-844 Tomasetti & Tomasetti (2000) FLC 93-023 Russell & Russell (1999) FLC 92-877 Dickson & Dickson (1999) FLC 92-843 |
First Applicant: Second Applicant: | MS JENKINS (BUSINESS OMITTED) PTY LTD (ACN (omitted)) |
| Respondent: | MR COWPER |
| File Number: | SYC 7499 of 2010 |
| Judgment of: | Judge Kemp |
| Hearing dates: | 21, 22, 23 and 24 May 2012 and 26, 27 and 28 March 2013 and 9, 10, 11 and 12 September 2014 |
| Date of Last Submission: | 12 September 2014 |
| Delivered at: | Sydney |
| Delivered on: | 27 February 2015 |
REPRESENTATION
| Counsel for the First and Second Applicants: | Ms Winfield |
| Solicitors for the First and Second Applicants: | Katie Smith Solicitor |
| Counsel for the Respondent: | Ms Cotter-Moroz and then self-represented |
| Solicitors for the Respondent: | LAC Lawyers and then self-represented |
ORDERS
The Court declares that pursuant to s.90RD of the Family Law Act 1975 (“the Act”) a de facto relationship, as defined in s.4AA of the Act, existed between the first applicant and the respondent during the following periods:
(a)August 1995 to December 1997 [2 years 4 months];
(b)July 1999 to October 1999 [3 months]; and
(c)February 2002 to February 2010 [8 years].
being for a period of 10 years and 7 months breaking down on 28 February 2010.
No later than 42 days from the date hereof, the respondent shall transfer to the first applicant the whole of his interest in and to the property situate at and known as Property H, NSW (“the Property H property”), being more particularly described as the whole of the land comprised in Certificate of Title Folio Identifier (omitted) and shall hand to the first applicant or her solicitors a duly executed Real Property Act Transfer in registrable form.
Simultaneously with compliance with order 2 above, the parties shall do all things and sign all documents so as to cause to be discharged the registered first mortgage secured over the Property H property in the joint names of the parties in favour of (omitted) bank.
Simultaneously with compliance with orders 2 and 3 above, the first applicant shall pay to the respondent the sum of $71,863.18 (“the adjustment sum”) less the sum of $10,000.00, being $61,863.18 (“the settlement sum”).
Simultaneously with compliance with orders 2, 3 and 4 above, the first applicant shall transfer to the respondent the whole of her interest in and to the property situate at and known as Property G, NSW (“the Property G property”), being more particularly described as the whole of the land comprised in Certificate of Title Folio Identifier (omitted) and hand to the respondent or any solicitor retained by him, a duly executed Real Property Act transfer in registrable form.
That upon the first applicant’s compliance with order 5, the respondent shall indemnify the first applicant in relation to outgoings in respect of the Property G property, including all rates, taxes, charges and insurance and all fines levied by Council in respect of the said property.
If there is non-compliance with orders 2, 3 and 4 above, then within 70 days of the date of these orders, the first applicant and the respondent are to join in and do all acts and things and sign all necessary documents in order to effect a sale of the Property H property and pay the whole of the net proceeds of sale, as referred to in order 8 below.
That the following amounts be deducted from the purchase money on the sale of the Property H property:
(a)The costs, expenses and commission of the real estate agent or agents acting on the sale of the property.
(b)The costs, fees and disbursements of the lawyer or lawyers acting for the parties on the sale of the property.
(c)The whole of the principal and interest outstanding to the bank pursuant to mortgage No (omitted) to (omitted) Bank.
(d)Adjustment of water rates and council rates.
(e)The balance to the respondent.
That pending settlement of the sale of the Property H property, the first applicant shall continue to manage the Property H property, collect the rent from the tenants of the Property H property and apply the rent in payment of all outgoings and expenses on the Property H property.
That if there is non-compliance with orders 2, 3 and 4 above and orders 7 and 8 above are implemented, then within 90 days of the date of these orders the respondent is to pay the first applicant the sum of $368,136.82 plus the sum of $10,000.00, being $378,136.82.
That both parties shall do all acts and things and execute all necessary documents and writings and give all consents necessary to give effect to these orders.
The first applicant and second applicant are hereby restrained by themselves, their servants and agents from enforcing any costs judgment obtained against the respondent in the Supreme Court of New South Wales.
That in the event that a party refuses or neglects to execute any deed or instrument necessary to give effect to all or any of the orders made, that the Registrar of the Court at Sydney be appointed pursuant to s.106A to execute the deed or instrument in the name of the defaulting party and to do all acts and things necessary to give validity and operation to the deed or instrument.
That either party have leave to relist the matter on 7 days’ notice in respect of the implementation of all or any of these orders and in relation to any further machinery required to effect a sale of the Property H property.
That, save as hereinbefore mentioned, and as between the parties each be declared the owner of all items of personalty, real estate, motor vehicles, choses in action, superannuation, bank accounts, business undertakings, related plant and equipment and any other such property in their name, control and possession as at the date hereof.
If any party seeks costs, an appropriate written application may be made within 28 days of today’s date, (supported by any documentary material) to be filed and served within that time period and a copy forwarded to my chambers. The Court will then deal with that matter by way of written submissions, unless the parties wish to be heard orally. If no such application is made within the time period specified, there will be no order as to costs.
Save as to costs, all other applications be dismissed and the matter be removed from the active pending cases list.
IT IS NOTED that publication of this judgment under the pseudonym Jenkins & Anor & Cowper is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYC 7499 of 2010
| MS JENKINS |
First Applicant
| (BUSINESS OMITTED) PTY LTD (ACN (omitted)) |
Second Applicant
And
| MR COWPER |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an application by the de facto wife (“the first applicant”) for property orders.
The first applicant seeks orders, as set out in an Amended Initiating Application filed on 7 March 2013, to the following effect:
(1)No later than 42 days from the date hereof, the respondent shall transfer to the first applicant the whole of his interest in and to the property situate at and known as Property H (“the Property H property”), being more particularly described as the whole of the land comprised in Certificate of Title Folio Identifier (omitted) and shall hand to the first applicant or her solicitors a duly executed Real Property Act Transfer in registrable form.
(2)At the same time, the respondent shall do all things and sign all documents so as to cause to be discharged the registered first mortgage secured over the Property H property in the joint names of the parties in favour of (omitted) Bank. This order was different in terms to that as set out in the first applicant’s Initiating Application filed on 29 November 2010 which sought that upon discharge of that mortgage the parties were to further cause such mortgage to be refinanced such that the parties’ indebtedness was to be as follows: to the first applicant $160,000.00 and with the balance to the respondent.
(3)Simultaneously with the aforementioned transactions, the first applicant shall transfer to the respondent the whole of her interest in and to the property situate at and known as Property G (“the Property G property”), being more particularly described as the whole of the land comprised in Certificate of Title Folio Identifier (omitted) and the first applicant to hand to the respondent’s solicitors a duly executed Real Property Act transfer in registrable form.
(4)That, save as hereinbefore mentioned and as between the parties, each be declared the owner of all items of personalty, real estate, motor vehicles, choses in action, superannuation, bank accounts, business undertakings, related plant and equipment and any other such property in their name, control and possession as at the date hereof.
(5)Costs.
The second applicant did not seek any specific orders.
The respondent de facto husband (“the respondent”), on the other hand, initially sought orders, as set out in his Response filed 14 February 2011 and then as amended by a Minute of Order, being Exhibit “1A”, to the following effect:
(1)A declaration pursuant to s.90RD of the Family Law Act 1975 (the Act), that a de facto relationship, as defined in s 4AA of the Act, existed between the first applicant and the respondent, that commenced on 2 May 2005 and broke down on 28 February 2010. [That is for a period of 4 years 9 months].
(2)That the first applicant, without delay transfer to the respondent free of all encumbrance the Property G property.
(3)That the respondent or his solicitor prepare the transfer and all necessary documents to give effect to Order 2 and that they be executed by the first applicant within 14 days of being forwarded to the first applicant (or her solicitor) for execution AND FURTHER that within the period of 14 days that they be returned to the respondent (or his solicitor) and that when they are returned such transfer and other documents be accompanied by the relevant certificate and other documents of title if they are in the power or possession of the first applicant.
(4)That within 28 days of the date of these orders, the first applicant and the respondent join in and do all acts and things and sign all necessary documents in order to effect a sale of the Property H property and that they pay the whole of the net proceeds of sale, after payment of the outgoings referred to in order 6 to the respondent.
(5)That the respondent have the authority to conduct the sale of the Property H property either by public auction or by private treaty and to nominate the agent and lawyer to have carriage of such sale and to nominate the minimum reserve price or contract price (as the case may be) in an amount of no less than $390,000, and to transfer [the Property H property] to the purchaser or purchasers and to receive and disburse the purchase money in accordance with these orders.
(6)That the following amounts be deducted from the purchase money and paid out by the respondent before any money is paid to the respondent pursuant to these orders:
(a)The costs, expenses and commission of the real estate agent or agents acting on the sale of the property.
(b)The costs, fees and disbursements of the lawyer or lawyers acting for the parties on the sale of the property.
(c)The whole of the principal and interest outstanding to the bank pursuant to mortgage No (omitted) to (omitted) Bank.
(d)Adjustment of water rates and council rates.
(7)That pending settlement of the sale of the Property H property, the first applicant shall continue to manage the Property H property, collect the rent from the tenants of the Property H property and apply the rent in payment of all outgoings and expenses on the Property H property.
(8)That both parties shall do all acts and things and execute all necessary documents and writings and give all consents necessary to give effect to these orders.
(9)That in the event that the first applicant refuses or neglects to execute any deed or instrument necessary to give effect to all or any of the orders made, that the Registrar of the Court at Sydney be appointed pursuant to s.106A to execute the deed or instrument in the name of the [first applicant] and to do all acts and things necessary to give validity and operation to the deed or instrument and the first applicant shall pay the costs of the respondent, on an indemnity basis, in relation to obtaining of the Registrar's signature.
(10)That either party have leave to relist the matter on 7 days notice in respect of the implementation of all or any of these orders and in relation to any further machinery required to effect a sale of the Property H property.
(11)That upon the first applicant’s compliance with order 2, the respondent shall indemnify the first applicant in relation to outgoings in respect of the Property G property, including all rates, taxes, charges and insurance and all fines levied by Council in respect of the said property.
(12)That subject to these orders, the first applicant and the respondent be declared as against each other to have the sole right, title and interest in, and to be the legal and beneficial owners of:
(a)Any motor vehicles, plant and equipment, chattels, goods, furnishings and real property and other property which are at the date hereof in their possession respectively.
(b)Any monies, shares and debentures which stand in their sole names respectively as at the date hereof.
(c)Any entitlements to superannuation which stand in their sole names respectively as at the date hereof
(d)Any interest in any trust or any insurance policy in the possession of such party as at the date of the making of these Orders, and for this purpose, interests in any trust and/or insurance policies are deemed to be in the possession of the beneficiary thereof.
(13)That, otherwise than provided for in these orders, each party shall be responsible to pay any debt or liability of that party standing in his or her name or in relation to any liability in relation to any property or entity which that party is entitled to pursuant to these orders, and that he or she indemnify the other party in respect of such liability.
(14)That the first applicant pay the respondent’s costs of and incidental to these proceedings.
Notwithstanding the orders as set out in paragraph 4 above, the respondent subsequently filed two further amended Responses, on 26 March 2013 and on 26 September 2013. The final amended Response simply sought, inter alia, the following orders:
(1)The first applicant’s case be dismissed.
(2)The first applicant take all steps to remove her name from the titles of the Property H property and the Property G property and to pay the respondent the loan of $75,000.00 plus interest.
(3)Costs.
The respondent on the final day of hearing in his oral submissions confirmed that the orders, the subject of his proposal, were substantially those, as set out in paragraph 5 above. The Court has, however, set out above the earlier proposed orders sought by the respondent when he was legally represented.
The first applicant relies, subject to all proper claims as to admissibility, and after formal objections were taken, on the following:
a)Her affidavit affirmed 25 November 2010 and filed on 29 November 2010 (limited to paragraph 49 only);
b)Her affidavit affirmed 27 April 2012 and filed on 30 April 2012;
c)Her Statements of Financial Circumstances affirmed 26 April 2012 and filed on 30 April 2012 and affirmed and filed on 27 March 2013;
d)Affidavit of Ms M affirmed on 27 April 2012 and filed on 30 April 2012;
e)Affidavit of Ms E affirmed on 4 May 2012 and filed on 7 May 2012;
f)Affidavit of Mr I sworn/affirmed on 8 May 2012 and filed on 14 May 2012; and
g)Affidavit of Mr M, affirmed on 12 February 2014 and filed on 21 February 2014.
The respondent relies, subject to all proper claims as to admissibility, and after formal objections were taken (noting that none were taken to the respondent’s own affidavits until after his cross-examination was concluded and, therefore, such objections were rejected), on the following:
a)His affidavit sworn on 9 February 2011 and filed on 14 February 2011 (limited to paragraph 49 only);
b)His affidavit sworn on 16 April 2012 and filed on 17 April 2012;
c)His Statements of Financial Circumstances sworn on 7 May 2012 and filed on 9 May 2012 and sworn on 27 February 2013 and filed on 28 February 2013;
d)Affidavit of Mr W sworn on 7 March 2012 and filed on 9 May 2012;
e)Affidavit of Ms A sworn on 3 April 2012 and filed on 9 May 2012;
f)Affidavit of Mr A sworn/affirmed on 21 April 2012 and filed on 23 April 2012;
g)Affidavit of Ms B sworn and filed on 23 April 2012;
h)Affidavit of Mr J sworn/affirmed and filed on 23 April 2012;
i)Affidavit of Ms N sworn on 26 April 2012 and filed on 1 May 2012;
j)Affidavit of Ms S sworn/affirmed on 2 May 2012 and filed on 4 May 2012;
k)His affidavit sworn on 25 September 2013 and filed on 26 September 2013 (being part of tender bundle 3 in Exhibit “12”);
l)His affidavit sworn on 29 January 2014 and filed on 31 January 2014; and
m)His affidavit sworn on 7 August 2014 and filed on 11 August 2014.
The first applicant and the respondent were orally examined as were the balance of their witnesses, save for Mr M, Mr W and Mr A who were not required for cross-examination.
The following documents were tendered as Exhibits in the proceedings:
Exhibit No
Document
Date
Tendered by
A
Birthday card to the first applicant from the respondent
17/1/96
First Applicant (“FA”)
B
Photograph of first applicant and respondent with family members
FA
C
Letter from Katie Smith to the respondent
6/12/12
FA
D
Letter from Katie Smith to the respondent
5/3/13
FA
E
Letter from Katie Smith to LAC Lawyers
17/8/12
FA
F
Draft joint balance sheet
26/3/13
FA
F1
Draft joint balance sheet as at 9 September 2014
FA
F2
Draft joint balance sheet as at 10 September 2014
FA
F3
Draft joint balance sheet as at 11 September 2014
FA
G
Further balance sheet as at 27 March 2013
FA
H
Letter from LAC Lawyers Pty Ltd to Ms Katie Smith dated 10 August 2012
FA
J
Bundle of (omitted) Bank account statements consisting of Parts 1 and 2
FA
K
First applicant’s tender bundle consisting of 3 Financial Statements for the respondent
FA
L
(omitted) transfer certificate and Claims Statement (12 pages) in respect of the applicant
FA
M
Photograph
FA
N
Two home loan accounts from (omitted) Bank in the outstanding sums of $327,550.25 and $149,161.33 as at 11 September 2014 for Ms B
FA
O
First applicant’s (omitted) Bank account statement on 10 September 2014 in the sum of $1,574.28
FA
P
First applicant’s submission document dated 11 September 2014
FA
Q
(omitted) Superannuation documents in the name of the first applicant dated 9 May 2012
FA
1A
Minute of Orders as sought by the respondent May 2012
Respondent (“Res”)
1
(omitted) Bank account statements for the second applicant in respect of account number (omitted) in the period 15/12/09 to 5/3/12 covering statement pages 5-13
Res
2
(omitted) Bank account statements in the name of the first applicant in trust for Mr D and Mr S being statements 3 & 4 in period 2/7/02 to 6/2/03 (handwriting excluded) in respect of account number (omitted).
Res
3
(omitted) Bank account statement in the name of the applicant (being 2 pages of a 3 page statement) for the period 21/4/03 to 20/5/03 in respect of account number (omitted).
Res
4
Statement of account provided by (omitted) to the first applicant in respect of a loan amount of $180,000.00 for the period from 23/9/02 to 4/8/04 with a rollover from 4/8/04 to 16/6/11
Res
5
Statement of account provided by (omitted) to the first applicant in respect of a loan amount of $92,000.00 for the period from 23/9/02 to 4/8/04 with a rollover from 4/8/04 to 16/6/11
Res
6
Statement of account provided by (omitted) to the first applicant in respect of a loan amount of $80,000.00 which as at 16/6/11 totalled $81,984.32 together with a loan account as at 16/6/11 totalling $160,339.16 being $315,284.40 reducing to $314,412.52 as at 30/4/12
Res
7
Schedule of payments by the respondent to (omitted) in respect of the “second” loan on the Property H property in the period 2006 to 2009
Res
8
Letter from (omitted business) addressed to “whom it may concern” in relation to the surrender of the (omitted) Business Franchise by the second applicant
8/5/12
Res
9
Letter from Katie Smith Solicitor to LAC Lawyers
16/4/12
Res
10
Letter of agreement from Ms Jenkins
28/8/07
Res
11
Schedule of (omitted) loans dated 12/9/02 for $180,000.00 and $92,000.00 together with a letter from (omitted) to the respondent dated 9/6/06
Res
12
Respondent’s tender bundle
Res
13
Respondent’s banking summary from (omitted) Bank
Res
14
Seven pages statement from (omitted) Bank for Account (omitted).
Res
15
Discharge authority with signature of respondent for account (omitted).
25/11/11
Res
16
Five pages application by respondent dated 21/2/07 for finance and statement of account consisting of 8 pages and discharge form and discharge authority dated 9/3/12 for account (omitted).
Res
17
Subpoena to (omitted business) and documents attached
Res
Ms Winfield of Counsel appears for both applicants.
The respondent was originally represented by LAC Lawyers who had briefed on his behalf, Ms Cotter-Moroz of Counsel.
The hearing commenced on 21 May 2012 and ran for 4 days. The hearing was then adjourned to recommence for 2 days on 4 September 2012. However, those September 2012 hearing dates were vacated on 15 August 2012, but the 4 September 2012 date was preserved to deal with a number of procedural matters, including notices of objection to subpoenas, given then outstanding disclosure issues. The matter was then adjourned to 30 November 2012 when, by consent, the company (omitted business) Pty Ltd ACN (omitted) (“the second applicant”) was joined to the proceedings. The proceedings were then, after further procedural directions were made for disclosure and valuation, adjourned for a resumed final hearing for 3 days commencing on 26 March 2013.
On the resumption of the hearing of the proceedings on 26 March 2013, the respondent was self-represented. Ms Winfield continued to represent the applicants. Further oral evidence was taken from the first applicant on 26 and 28 March 2013. However, it became apparent that substantial financial disclosure was still outstanding and the parties spent most of the 27 March 2013 date inspecting documents produced on subpoena. It also became apparent that the parties had not resolved any of the valuation issues between them. This, unfortunately, necessitated further procedural orders and the relisting of the matter to determine compliance on 21 October 2013, 12 December 2013 and 5 February 2014, before resumed hearing dates could, in fact, be allocated. The final hearing dates were then relisted to commence on 9 September 2014.
On 9 September 2014, Ms Winfield continued to appear for the applicants. The respondent again appeared self-represented. This was the case, notwithstanding, that there had been discussions between the parties concerning the potential securing of real property (the subject of the parties’ competing applications) to obtain funds to enable the respondent to obtain legal representation. The first applicant had been afforded the opportunity to respond to the respondent’s affidavit sworn 25 September 2013 and filed on 26 September 2013, as was reserved to her on 21 October 2013, but this was not ultimately taken up.
Mr M provided an affidavit affirmed on 12 February 2014 and filed on 21 February 2014 with respect to the outstanding valuation issue of the first applicant’s interest in the business of (business omitted), operated by the second applicant. The second applicant had been joined at a time when this valuation issue was uncertain and some consideration had been given as to what orders could be made against the second applicant, including issues as to financial disclosure. The parties accepted the valuation of the first applicant’s said interest was “nil dollars”. Nevertheless, the respondent continued to express orally his concerns that the second applicant had a bank statement which apparently had funds in it, or out of which funds had been dissipated. The respondent did not seek to take that up with Mr M. However, there would have been little or no point in that, given the parties’ competing proposals and given also Mr M’s evidence as to the value of the first applicant’s interest, which the respondent did not dispute.
The respondent, in his affidavit filed 31 January 2014, was critical of the costs incurred by him of, he said, some $240,000.00 in the various proceedings with both applicants, given he said, he had no “faith or trust in a solicitor, at this stage” and he sought from the Court, “due diligence”, in finalising the case so as to avoid, further, costs. Notwithstanding this, in his affidavit filed 11 August 2014 and orally on 9 September 2014, he sought “leave from the resumed hearing due to health considerations”, the need for the release of monies to appoint a legal representative and a failure by the first applicant to comply with “obligations outlined by the Family Court of Australia in regards to pre-action procedures for financial cases”.
As such, on the morning of the resumed hearing on 9 September 2014, the respondent also orally sought an adjournment of the proceedings based on his recent pelvic cancer surgery supported by a letter from Dr P dated 10 July 2014, which stated that the respondent should avoid stress for a period of some 3 months, that is up to 10 October 2014. The respondent also relied on his inability to fund legal representation based, he said, on the first applicant’s failure to agree to provide security in the form of jointly held real estate to facilitate borrowings. This was a matter which the Court noted in February 2014, when the proceedings were listed for hearing, that the parties were to discuss and seek to reach agreement about, given that the respondent was then self-represented, suffering stress and needed, he asserted, legal assistance. However, no application supported by any evidence was ever made to the Court by the respondent prior to the resumed hearing in relation to this issue. The Court dismissed the respondent’s said oral application and gave reasons at that time. The Court indicated to the respondent that it would conduct the hearing in such a manner as to ensure that he was placed under as little stress as possible and would afford him appropriate time if he, during the course of the hearing, needed to take rest breaks. That occurred and the respondent raised no further issue in relation to the conduct of the hearing itself and his health.
The respondent, however, had a great deal of difficulty in concentrating on matters that the Court had to determine and his overall negativity towards the first applicant, unfortunately, negatively impacted on his ability to present his case.
Issues
There are a number of factual issues to be determined, although many of the facts relevant to this application are agreed.
There is no issue that the Court has jurisdiction given that the parties’ de facto relationship broke down on or after 1 March 2009, when both parties to the relationship were ordinarily resident in NSW.
The relevant factual matters in issue are:
a)The actual period of the parties’ de facto relationship;
b)The respective financial contributions of the parties; and
c)The respective non-financial contributions of the parties.
The parties’ competing proposals have similar orders in terms of that sought by the first applicant in proposed order 4 and that sought by the respondent in proposed orders 12 and 13. Given that there was no evidence as to the need for indemnification, the Court adopts the first applicant’s order 4 as dealing with those matters, under the respondent’s orders 12 and 13. Both parties appear “ad idem” as to the respondent acquiring the Property G property. In order to achieve that outcome, there will need to be an adjustment by way of the payment of money and/or the repayment of debt. It was not regarded as contentious that there would be orders enabling the parties to implement such an outcome and machinery provisions to effect the same.
Background facts
The following are the, largely, undisputed background facts:
a)The first applicant was born on (omitted) 1951 and at the time of completion of the final hearing was 63 years of age.
b)The respondent was born on (omitted) 1946 and at the time of completion of the final hearing was 68 years of age.
c)The parties were not married but lived together as husband and wife at various times, finally separating on 28 February 2010.
d)There are no children of the parties’ relationship.
e)The first applicant asserts that the parties lived in a de facto relationship from August 1995 to December 1997 (2 years and 4 months) at Property D, then from July 1999 to October 1999 (3 months) at Property L and then from February 2002 to February 2010 (8 years) on the (omitted), totalling in all 10 years and 7 months.
f)The respondent concedes that the parties lived in a de facto relationship from August 1995 to June 1996 (10 months) at Property D, from July 1999 to October 1999 (3 months) at Property L and from November 2009 to February 2010 (3 months) at the Property G property on the (omitted), totalling 1 year and 4 months, although he conceded that in the period December 2001 until mid-2005 (3 years and 6 months), while he remained living in Sydney he spent most of the weekends and holiday periods with the first applicant at the Property H property and from mid-2005 to September 2009 (4 years and 3 months) he spent on average 4-5 nights per week with the first applicant and all holidays with her. The respondent conceded that from about mid-2005, the parties did not maintain separate households. This appeared consistent with his minute of order filed at a time when he had legal representation. (See paragraph 4 above).
g)The respondent says that he was putting money into the first applicant’s account in the period September 2002 to June 2006. This was acknowledged by the first applicant.
h)The first applicant maintained that in the periods that the parties maintained separate addresses between April 1997 and July 1999 (2 years and 3 months) and between February 2000 and February 2002 (2 years) they, nevertheless, continued some form of a relationship.
i)On (omitted) 1973, the respondent married Ms A.
j)On (omitted) 1975, the first applicant’s son, Mr D, (“Mr D”) was born.
k)On (omitted) 1975, the respondent’s daughter, Ms B, (“Ms B”) was born.
l)On (omitted) 1976, the respondent’s son, Mr J, (“Mr J”) was born.
m)On (omitted) 1977, the first applicant’s son, Mr S, (“Mr S”) was born.
n)On (omitted) 1980, the respondent’s daughter, Ms S, (“Ms S”) was born.
o)On (omitted) 1981, the first applicant’s daughter, Ms E, (“Ms E”) was born.
p)On (omitted) 1987, the respondent purchased Property A, (“the property”). The Property A property was, subsequently, developed into 6 units by the respondent, his then wife, Ms A, Mr G and Ms R (“Mr E & Ms R”). The respondent ended up owning Units 1, 2 and 3 of this development, pursuant to an arrangement with Mr E & Ms R.
q)In 1988, the respondent and Ms A purchased the property at Property D (“the Property D property”) and during 1992 this property was rebuilt and renovated.
r)In 1993, the respondent and Ms A separated.
s)In 1994, Mr E & Ms R commenced proceedings in the District Court of New South Wales against the respondent and Ms A, claiming a sum of money by way of damages.
t)On 5 December 1994, Justice Moss in the Family Court of Australia gave judgment and made orders in respect of applications for property orders between the respondent and Ms A. Pursuant to those orders, the share of Ms A in the Property D property was transferred to the respondent and the parties were ordered to provide for payments to deal with Mr E & Ms R’s claim, as the subject of the proceedings as set out in paragraph (s) above. It was an agreed fact that the respondent was still indebted to Mr E & Ms R in the sum of $206,731.00 and that that sum had never been paid to them.
u)On 5 December 1994, the respondent was divorced from Ms A.
v)Between 3 and 4 May 1995, Ms A’s appeal from the orders of Justice Moss was heard by the Full Court of the Family Court of Australia (Ellis, Lindenmayer and Finn JJ) and dismissed.
w)The respondent said that he had first met the first applicant on (omitted) 1995. The first applicant says that she had been introduced to the respondent in late 1994 when she was working part-time for (employer omitted), Mr H. Nothing relevantly turns on that time difference.
x)From the date the first applicant and the respondent met, they dated but lived separately until (omitted) 1995, when the first applicant moved in to live with the respondent at the Property D property. At that time, the respondent was living at that address with his son, Mr J and daughter, Ms B. The first applicant’s daughter, Ms E, and son, Mr S, also moved into that property at that time. The Court accepts the first applicant’s evidence that there were some disputes between the parties’ children as to their then living arrangements (as conceded by Mr J) given also that, following renovations to those premises, there were a number of students also staying there as part of a student homestay business, operated by the respondent, which impacted on their living arrangements. The Court accepts that the first applicant took on a role in running that business, including shopping for food needs, taking bookings, cleaning and preparing an evening meal, although the Court accepts that the number of students was not as large as that first stated by the first applicant. The respondent conceded that the first applicant cooked but constantly denigrated her efforts, including claiming that “all of her food was burnt”. An external cleaner was engaged when the first applicant returned to part-time work in an (employer omitted), to an extent acknowledging the level of the first applicant’s contribution towards the cleaning work.
y)From August 1995 to June 1996, on the respondent’s version and until December 1997 on the first applicant’s version, the parties lived as husband and wife in a de facto relationship. This was confirmed by Ms M who observed on her visit to the Property D property that the first applicant and the respondent shared a bedroom. This accords with the respondent’s birthday card to the first applicant on (omitted) 1996, which states “Thanks for your love and work and loyalty, you are a lover and a wife and you are understanding and patient always yours”. It also accords with the first applicant’s evidence that she attended the respondent’s 50th birthday in (omitted) 1996 and prepared all of the food. Whilst the first applicant did not attend Ms B’s 21st birthday in (omitted) 1996, stating that Ms B went out that night, she nevertheless said that she had purchased a birthday cake from (omitted) for her. The Court accepts the clear evidence of the first applicant that she attended Mr J’s 21st birthday in (omitted) 1997 at the Property D property. She stated that she had prepared most of the food for that event, including a (omitted) shaped birthday cake and that, as a result of that recollection, she clearly recalled living with the respondent at that property at that time. The parties, during that period went to social events and, in particular, music and dancing at the (omitted) Club (which appears to have closed in 1996) and then at another club in the (omitted) area. The Court accepts that a de facto relationship, therefore, existed from August 1995 to December 1997, (that is, 2 years and 4 months). Notwithstanding that, in the period June 1996 to December 1997 the respondent asserted that he was dating other women. The first applicant’s evidence was that she was unaware of this. The respondent did not call any of these women to prove his assertion.
z)During 1996, the first applicant commenced full-time work with (omitted business), which was partly owned by her brother, Mr P.
aa)(omitted business) had contributed to the first applicant’s superannuation and the first applicant had recently withdrawn superannuation, leaving a balance of some $9,113.00. The withdrawn monies were used for the payment of Court fees ($1,700.00), council and water rates on the Property H property and living expenses.
bb)Following the break-up of the parties’ relationship in December 1997 referred to in paragraph (y) above, the first applicant then moved to premises at Property B for a period of some 3 months (December 1997 to March 1998) and then to premises at Property W for a period of approximately 5 months (April to September 1998). The premises at Property W were purchased for $235,000.00 by the first applicant and her two brothers, Mr P and Mr G, as tenants in common in equal shares.
cc)On 21 September 1998, the respondent exchanged contracts for the sale of the Property D property for $1,240,000.00, which sale completed on 28 January 1999. The respondent directly received $156,411.72 and $500,000.00 was paid as an investment sum to (omitted business) from the settlement proceeds.
dd)Ms E completed her year 12 school studies in 1998.
ee)In early February 1999, the respondent moved in with his son into premises at the Property A property. At that time, he renewed a relationship with his ex-wife, Ms A.
ff)On 24 June 1999, the first applicant and the respondent purchased at auction as joint tenants the property at Property L (“the Property L property”) for $445,000.00. The purchase date of the Property L property was at odds with the evidence of the first applicant’s daughter, Ms E, who recalled living at that property in 1998 when she said she was “still at school”. Her recollection may be of residing at the Property D property. The contract of purchase of the Property L property discloses both the first applicant and the respondent were residing together at unit 6 at the Property A property. The Court accepts the first applicant’s evidence that at the time of purchase, the Property L property was acquired for the parties to live in and not as a form of investment and that the parties had resumed their de facto relationship by at least July 1999, as asserted by her.
gg)In about June 1999, the property at Property W was sold and the proceeds of sale of $277,000.00 divided between the first applicant and her two brothers. The first applicant recalls that her share of the net proceeds of sale was in the order of $7,000.00.
hh)The de facto relationship between the first applicant and respondent then came to an end shortly before the end of October 1999, that is, it had run for a further 3 months, at that time. The Court is of that view as the first applicant had made three payments in respect of the mortgage at the Property L property being 15 September, 15 October and 15 November 1999 but had made no payment for December 1999 and by 4 February 2000, a transfer had been prepared whereby she transferred her half-share in the Property L property to the respondent for a 50% payment of the total of the 3 mortgage payments made. Both the first applicant and the respondent had engaged solicitors to effect that transfer. The first applicant’s evidence was that the relationship had broken down for the sole reason that there was “constant bickering” and that she had then “moved out”.
ii)Following the parties separation in October 1999, the first applicant moved to Property E, where she resided for up to 6 months, until about April 2000. During that period, the first applicant says that the respondent did not visit her. This was not accepted by the first applicant’s own daughter who recalled the respondent visiting the first applicant at Property E. Her evidence was, however, that during the first applicant’s time at Property E, she had made complaints about the respondent as she said, he had “hurt my mum and I had my back up”. That appears to relate to a broken engagement which was, subsequently, alluded to in the first applicant’s oral evidence, but, as Ms Cotter-Moroz submitted, had not been referred to in any of her affidavit material. Ms Cotter-Moroz submitted that if it had occurred, it would have been of such importance that the first applicant would have deposed to it in her affidavits and the fact that it was missing implied that it was of recent invention. The first applicant’s oral evidence was that the respondent had never formally proposed but had given her an “expensive” ($2,500.00) engagement ring, bought on her request, and when the relationship had not progressed further, at that time, she had returned the ring and it had been “pawned”. The Court accepts the first applicant’s evidence in that regard. The first applicant then moved to Property O in about mid-2000 where it would appear, that the respondent again commenced to visit her. The Court accepts the first applicant’s evidence that the respondent regularly stayed over weekends and during the week at that time while she resided in the property at Property O and until about February 2002. The respondent confirmed that from at least November/December 2001, he began to spend time with the first applicant. The first applicant’s conversation with Ms M at about that time was to the effect that the parties were not back living together, but that the respondent spent a couple of times a week at the first applicant’s residence. However, the first applicant recalled that she did not attend Ms S’s wedding in (omitted) 2000, but that straight after that wedding, the respondent had turned up at her place in his “tuxedo”. The first applicant conceded that the respondent did not wear a tuxedo and that the word that she intended to use was “formal wear”. The respondent’s former wife initially stated that she could not recall where the respondent had gone after the wedding and then when pushed by the respondent, stated that he had stayed in her bed that night. The Court does not accept her evidence, in that regard, and prefers the evidence of the first applicant. Nevertheless, the Court is of the view that at that time a de facto relationship had not yet revived between the first applicant and the respondent and did not do so until around February 2002. This view is supported by the respondent’s maintenance of a separate residence and the specific property dealings referred to in the following sub-paragraphs.
jj)On 17 February 2001, the respondent sold the Property L property for $572,000.00 and settlement of that sale was effected on 20 April 2001. After payment to (omitted) Bank as the mortgagee of $181,848.97 and after various other disbursements and adjustments were paid, the respondent received $316,459.10.
kk)Following the settlement of the sale of the Property L property, the respondent moved into the premises at the Property B property which he had acquired by way of exchange of contracts on 30 March 2001 and which settlement of sale was effected on 14 June 2001. The respondent purchased that property in his own name for $425,000.00, it would appear by either paying cash or bank cheque.
ll)On 1 May 2001, the settlement of the sale of a property known as Property F was completed. This property was owned by the Estate of the respondent’s late mother, Ms T. The respondent and his two siblings split the balance of the settlement proceeds between them, with the respondent receiving in the order of $130,000.00.
mm)On 8 October 2001, the respondent settled his purchase of a property in his own name and the name of a company called (omitted) Pty Ltd (omitted) (which appears to have been related in some way to Mr W) at Property C, NSW, providing the balance of settlement funds of $153,800.00 by way of approximately $76,800.00 from his own funds and by borrowing a further $77,000.00 from (omitted) Bank. The respondent’s financial statement sworn 7 May 2012, however, disclosed that he no longer held any interest in the Property C property at that time. Mr W in his affidavit affirmed 7 March 2012, makes no mention of that property in terms of the history of his relationship with the respondent, save that his address in his affidavit was the same address as the company (omitted) Pty Ltd, being Property S.
nn)In about February 2002, the first applicant moved from Property O and commenced to live in rented accommodation at Property M to enable her to run a business known as (business omitted). In early 2002, the first applicant was admitted to (omitted) Hospital. It was put to the first applicant that she had taken medication in tablet form to excess. The first applicant denied this, but said that she had, in fact, consumed alcohol to excess and had passed out.
oo)Following the first applicant’s move in February 2002, the Court accepts that while the respondent continued to live at the Property B property and work in Sydney he, nevertheless, would travel to (omitted) to stay with her on Friday and Saturday nights, often returning to Sydney on Sunday evenings for the purposes of commencing work on Monday. The Court accepts that as and from this date, the parties had re-commenced their de facto relationship. The respondent agreed that he commenced to see the first applicant in November/December 2001. Given the geographic separation, the Court is of the view that the de facto relationship between the first applicant and the respondent would not have continued without a genuine commitment by both to support such a relationship, with the respondent travelling up most weekends and holidays and spending time with the first applicant on the (omitted). This is supported by Ms M’s evidence when she attended at Property M and observed the first applicant and the respondent sharing a bedroom, relating affectionately with each other and speaking about their joint plans and doing things together. Ms M also confirmed that the respondent when introducing the first applicant referred to her as “my wife Ms Jenkins”. The Court accepts Ms M’s evidence in that regard. This view is strengthened by the fact that on 10 August 2002, the first applicant and the respondent purchased premises being the Property H property as joint tenants for $340,000.00 (together with Stamp Duty of $10,800.00), disclosing their joint residential address on the contract as Property M. The first applicant’s evidence was that the Property H property was purchased as the parties’ future retirement home. The first applicant was challenged on this given that there was no reference in her affidavit material to a conversation with the respondent to that effect. This was conceded by the first applicant. The first applicant also conceded on a number of occasions in answer to questions posed by Ms Cotter-Moroz as to why matters had not been disclosed in her affidavit that, her affidavit had not been as complete as she now understood it should have been. This concession was made notwithstanding that the first applicant also acknowledged that she had been legally represented throughout the conduct of the proceedings. While it was put to her that her evidence in this regard was fabricated, the Court accepts her denial of that proposition. Notwithstanding the purchase of the Property H property, the respondent continued to reside during the week in Sydney at his then home at the Property B property, which he was then renovating. The first applicant says that the respondent travelled up most weekends and she was in daily telephone communication with him. The Court accepts that evidence. The respondent was also working in Sydney on various properties at (omitted). The Court accepts the respondent’s evidence that if he was working in Sydney on a Monday he would invariably travel back to Sydney on the Sunday evening. If he was not working on the Monday, it was likely that he would remain on the (omitted) with the first applicant on the Sunday night. The evidence of the first applicant was that she had discussed with the respondent the move to (omitted) given that she had been provided with a short list of areas for her proposed (omitted) Business Franchise. The first applicant based her decision on (omitted), given the respondent’s acknowledgment that “it would be a nice place for both of us to retire”. In (omitted) 2003, the first applicant and the respondent attended Ms M’s son’s wedding in (omitted) travelling up in a caravan and staying at the local caravan park. At this time, the Court accepts that they were in a committed relationship as a couple living together on a genuine domestic basis and holding themselves out to others as such.
pp)The first applicant’s daughter, Ms E, said that at all times when she had attended to visit her mother in (omitted), (being once every three weeks), she had observed the respondent to be present. During the period that Ms E worked for (omitted business) in (omitted) she would stay up on a Friday night and Saturday night and travel back to Sydney on Sunday, commuting back to work in (omitted) on the Monday. When she worked in Sydney, she would travel by rail or car up to (omitted) on a Friday evening and then travel back on Sunday after dinner to avoid traffic. That position of her visiting every three or so weeks continued substantially, up until the parties’ separation in February 2010. During all of those times, she observed the parties to share a bedroom, operate as “husband and wife” in social situations, demonstrate affection and care for each other and to otherwise exhibit a mutual commitment to a shared life. This included attending to meals at home and going to dinners at clubs, maintaining relationships with the members of each party’s extended families, including attending at family functions at Easter and Christmas. The first applicant’s evidence was that she purchased gifts for the respondent’s family saying: “I always bought them something, but not clothing items”.
qq)The acquisition of the Property H property in September 2002 in joint names was effected by the respondent providing $80,000.00 cash and the parties jointly borrowing from (omitted) with a mortgage effected with (omitted) Bank (“(omitted)”) in the sum of $272,000.00, which was then split with separate loan contracts (but still in joint names), one for $180,000.00 (account (omitted) with a monthly instalment of $1,035.94) and one for $92,000.00 (account (omitted) with a monthly instalment of $529.48). The respondent complained that the Property H property had been acquired as joint tenants when the first applicant alone had instructed solicitors to the effect that the property be acquired as joint tenants contrary to his “agreement” that it should be tenants in common as to a one-quarter share in the first applicant and three quarters in the respondent. No evidence was called from any such solicitors and this weighs against the respondent’s assertion.
rr)In about August 2004, the parties jointly borrowed a further sum of $80,000.00 (pursuant to a separate joint loan account with (omitted), being account number (omitted), with a monthly instalment of $489.89) also secured over the Property H property, the funds from which were used partially as to $12,000.00 for the renovation of the garage and kitchen at the Property H property, $20,000.00 used in the first applicant’s business, including advertising and set up expenses and $15,000.00 provided by way of three $5,000.00 payments used for materials in the renovations. The Court accepts the respondent’s evidence, given his qualifications as a (occupation omitted) that he was intimately involved in effecting and completing those renovations. The respondent, in the Supreme Court proceedings, conceded that at least some $20,000.00 of these funds were used in improving the said property. The balance of some $33,000.00 appears to have been expended on living expenses between the parties.
ss)From about mid-2005, the respondent commenced to spend approximately 4-5 nights a week with the first applicant at the Property H property and this continued until 7 September 2009, when the respondent moved into the Property G property. Relevantly, it would appear that the NSW Office of State Revenue wrote to the respondent in March 2010 after his 2010 Land Tax Assessment Notice, which had been addressed to the Property B property, had been returned as unclaimed mail. This office also said it had information concerning a rental bond current on that property and sought details as to the respondent’s then living arrangements and his relationship to the first applicant.
tt)On 1 July 2005, the first applicant (as principal and guarantor) and the second applicant (as franchisee) entered into a franchise agreement with (omitted) Bank (“the franchisor”) to operate a business under the “(business omitted)” business name in the territories defined therein for an initial period of five years. This business operated out of Property N, NSW. The first applicant acquired that franchise with the assistance of (omitted) Pty Ltd, which acquired 100 shares in the second applicant with the first applicant owning the other 100 shares in that company. The first applicant’s evidence was that Mr C had injected $40,000.00 of his own funds into the company by way of an initial investment of $30,000.00 and a second investment of $10,000.00.
uu)Notwithstanding the respondent moving into the Property G property in September 2009, both parties conceded that a de facto relationship then existed until the parties’ separation in February 2010.
vv)While the respondent concedes that (omitted) Bank, as the mortgagee on the Property H property, was paid by the first applicant from her account up until June 2006, he deposed to her paying sums totalling $83,050.00 by way of loan repayments. The respondent said that he had paid the loan repayments under the various loans from June 2006 to June 2011, totalling $137,436.00, but acknowledged receiving repayments from the first applicant in the period June 2011 to June 2013 of approximately $40,000.00. The respondent, further, acknowledged that the first applicant had paid, in the period September 2002 to June 2013, statutory rates and levies in the order of some $10,462.00 (see tender bundle pages 831-832).
ww)When one totals the approximate mortgage payments under the loan contracts referred to in paragraph (qq) above, over a period of some 45 months, the payments to (omitted) Bank would have totalled in the order of some $70,443.90.
xx)From about June 2006, both the first applicant and the respondent agree that repayments to (omitted) Bank, as the mortgagee, were rearranged so that all payments came out of the respondent’s account (omitted) with the (omitted) Bank and the first applicant then deposited her own monies into that account.
yy)Between June 2006 and September 2010, the respondent paid direct to (omitted) Bank the sum of $68,710.10 and the first applicant repaid to him approximately $15,043.75.
zz)On 8 March 2007, (omitted business) advised the respondent that it had approved a loan facility in the sum of $424,000.00 to be secured by way of security over the property at Unit 1 in the Property A property.
aaa)On 24 August 2007, the respondent lent the first applicant the sum of $75,000.00, which the respondent drew down in the sum of $80,000.00 from an existing line of credit (loan (omitted)) with (omitted) Bank, secured over Unit 1 in the Property A property. These funds were then transferred into the respondent’s account and then withdrawn as to $75,000.00 by him and paid to the first applicant. The respondent maintained that the first applicant needed these funds for her motor vehicle which was coming off its lease and for a tax debt to the Australian Taxation Office in the order of some $60,000.00. The first applicant maintained that the funds were also needed for her business.
bbb)On 3 April 2008, the respondent’s loan from (omitted) Bank (referred to in aaa above) was split to create a new loan account (omitted), which then had the sum of $75,000.00 transferred, so as to credit account number (omitted) with that amount.
ccc)On 19 July 2009, the respondent exchanged contracts for the sale of unit 2 at the Property A property for the sale price of $549,000.00. This sale settled on 27 August 2009.
ddd)On 15 August 2009, the parties’ purchased the Property G property for $370,000.00 as joint tenants. To assist with the acquisition, the sum of $336,000.00 was borrowed through (omitted business) via two loan accounts, being Account Number (omitted) for $280,000.00 and Account Number (omitted) for $56,000.00. At the time, it was intended by the parties to use this property as a base for the first applicant’s business so as to save on rent and the respondent maintained that he had effected some “fit out” works to the front of the house there to accommodate the business. The first applicant, however, maintained that such works were limited to painting. The first applicant’s business did not, ultimately, move into that property.
eee)On 1 September 2009, the respondent commenced his installation of (omitted) business.
fff)From about September 2009, the respondent moved into the Property G property but stayed in a caravan while works were carried out on the Property G property and so as to protect a substantial number of the (omitted) which had been delivered there, as part of the running of his said business. The first applicant continued to live in the Property H property until she also moved into the Property G property in November 2009. The Property H property was then leased out. From November 2009, both the first applicant and the respondent were living in the same residence at the Property G property.
ggg)The parties continued, therefore, to live in a de facto relationship at the Property G property until their agreed date of separation of 28 February 2010.
hhh)On 28 February 2010, the first applicant moved out of the Property G property. The first applicant’s daughter’s evidence was that the first applicant had, by that time, closed the Property N office of (business omitted) (that is in about August 2009). That evidence did not accord with the first applicant’s own recollection when she said that for a period she had split her time between the Property N property and the Property G property.
iii)By the end of February 2010, the parties had a debt to (omitted) of $162,706.71 in the name of the first applicant and of $83,172.11 in the name of the respondent, totalling $245,878.82, being a reduction from the principal sum initially borrowed, as set out in paragraph (qq) above, by some $26,121.18.
jjj)By the end of February 2010, the respondent’s loan of $80,000.00 as referred to in paragraph (aaa) above, had been reduced to $74,623.89.
kkk)On 8 June 2010, the respondent’s solicitors (Harrington Maguire and O’Brien) wrote to the first applicant’s solicitor (K Smith) confirming that the respondent had been fined by (omitted) City Council for storing (omitted) in the open air at the Property G property and sought the first applicant’s approval to the lodgement of a development application to erect a prefabricated shed on that property for the storage of the (omitted).
lll)On 29 June 2010, the sum of $75,074.74 was paid into the account, the subject of the loan agreement referred to in paragraph (aaa) above, so as to substantially clear that indebtedness. However, on 30 June 2010, that payment was dishonoured.
mmm)On or about 30 June 2010, the business of (business omitted) was surrendered to (business omitted).
nnn)In about August 2010, the first applicant ceased her involvement in the business conducted as (business omitted). Between August 2010 and December 2010, the first applicant then worked part-time in a (employer omitted), working some 20 hours per week and grossing $528.00 per week.
ooo)On 15 October 2010, the respondent commenced proceedings against the first applicant in the Supreme Court of New South Wales in respect of the Property H property under s.66G of the Conveyancing Act 1919 (NSW), seeking an order for the appointment of a trustee for sale (“the Supreme Court proceedings”).
ppp)On 26 November 2010, by way of a notice of motion filed in the Supreme Court proceedings, the first applicant sought a stay of the proceedings.
qqq)On 29 November 2010, these proceedings were commenced in this Court.
rrr)On 21 December 2010, the respondent settled the sale of unit 3 at the Property A property to Mr J and Ms C, the respondent’s son and daughter-in-law, for $400,000.00. The respondent accepted that this property was worth, at the time, approximately $580,000.00. The difference of $180,000.00 was regarded by the respondent as a gift to his son and daughter-in-law.
sss)On 5 April 2011, the sum of $75,800.00 was paid into the account the subject of paragraph (aaa) above, so as to place that account in credit in the sum of $586.69.
ttt)By orders made on 15 April 2011, the Supreme Court proceedings were stayed, pending further order, subject to the parties doing all such things as to convert the mortgage secured against the Property H property to an interest-only one, to cause the rental income from the Property H property to be paid by the tenants to the first applicant and to allow the first applicant to take over and assume responsibility for the management of the tenancy and the payment of all outgoings and expenses on the Property H property and for the respondent to remove any (omitted) stored by him on that property. The respondent was permitted to apply any rental income received by him to the date of that order to the mortgage secured against the Property H property. The refinance on the Property H property was effected in about mid-June 2011.
uuu)The orders referred to in (ttt) above dealt with the issue of certain arrears on the loans then secured over the Property H property.
vvv)Following the making of the orders referred to in (ttt) above, the first applicant maintained that the respondent had failed to clean and maintain the swimming pool on the Property H property for the tenant’s use and had failed to deal with the problem of a backflow of sewerage. The first applicant arranged for external tradesmen to attend to those matters. The first applicant confirmed that, after some delay, the (omitted) were all removed by the respondent from the Property H property.
www)By order made on 15 June 2011, the mortgage secured over the Property H property was converted to an interest only loan and on 2 December 2011, the Supreme Court proceedings were stood over to 28 May 2012.
xxx)Between August 2011 and November 2011, the following drawdowns were made on the account referred to in (aaa) above: $15,000.00 on 17 August 2011; $25,000.00 on 26 September 2011; $15,000.00 on 26 October 2011; $10,000.00 on 9 November 2011; and $9,674.00 on 16 November 2011, totalling $74,674.00.
yyy)On or about 15 March 2012, the franchise of (business omitted) was taken over by a company known as (omitted) Pty Ltd (omitted), owned and operated by Mr Z.
zzz)On 27 March 2012, the respondent served a statutory demand dated 14 March 2012 on the second applicant, seeking payment of the principal sum of $75,000.00 plus interest of $10,949.00 with certain recovery fees of $1,565.00 amounting to $87,514.00 (although the demand refers to the figure of $89,403.00).
aaaa)On 10 April 2012, the second applicant commenced proceedings in the Supreme Court of NSW (Equity Corporations List)(“the Supreme Court Company proceedings”) seeking an order that the said statutory demand be set aside with costs. These proceedings were made first returnable on 19 April 2012. The said demand was ultimately set aside and the respondent ordered to pay costs in the sum now agreed of $10,000.00. The liability to pay such costs would appear to be either to the first applicant or second applicant or indeed, both, as set out in the agreed balance sheet document referred to below.
bbbb)On 23 April 2012, the settlement of the sale of unit 1 in the Property A property occurred. The sale price was $170,000.00 and the sale was made from the respondent to himself and to one of his daughters, Ms B, as tenants in common in equal shares. The purchase price was $180,000.00, less than the 50% value of the property then being $700,000.00. This was considered by the respondent as a gift to his daughter. Ms B borrowed $500,000.00 from the (omitted) Bank and the respondent guaranteed the repayment of $330,000.00. Out of the settlement proceeds, the respondent repaid the $75,000.00 debt secured on that property, referred to in paragraph (aaa) above.
The law
The Jurisdictional Facts
In order for the Court to have the jurisdiction to make property orders under the Family Law Act1975 (“the Act”) in respect of de facto relationships, there are 2 jurisdictional facts that must be established and those facts must be established on the evidence before the Court. Those jurisdictional facts are contained in s. 4AA and s. 90SB of the Act.
First, the relationship must have broken down after 1 March 2009 (see Fenton & Marvel [2013] FamCAFC 132). Secondly, the relationship must have subsisted for at least 2 years. For the purpose of making such a finding, it is permissible to aggregate periods of a de facto relationship, provided the total amounts to at least 2 years. When aggregating periods of a de facto relationship, it is permissible to aggregate periods prior to 1 March 2009, provided that the relationship finally broke down after 1 March 2009 (see Dahl & Hambly [2011] FamCAFC 202).
As Murphy J succinctly explained in Fenton & Marvel [2013] FamCAFC 132:
“In order to establish that the court has jurisdiction to entertain the [a] claim under s 90SM, the legislation [requires the Court to] answer a number of interrelated questions:
· Was there a relationship between the applicant and the respondent that broke down finally before 1 March 2009? If the question is answered yes, the court has no jurisdiction to entertain the s 90SM claim, irrespective of whether the relationship might satisfy the definition of a de facto relationship and irrespective of its length. If the question is answered no, further questions must be asked.
· Was the relationship that broke down finally after 1 March 2009 a relationship that meets the definition of “de facto relationship” as prescribed by s 4AA of the Act? If that question is answered no, the court has no jurisdiction to entertain the s 90SM claim irrespective of the length of the relationship. If the answer to that question is yes, a further question needs to be asked.
· Did the de facto relationship exist for “at least 2 years” (noting that the requisite period can be established by aggregating the periods of relationship)?”
The classic definition of separation can be found in Pavey & Pavey (1976) FLC 90-051. Although, this relates to marriage, the concept is applicable to a de-facto relationship. The Full Court of the Family Court of Australia said in that case:
“Separation means more than physical separation – it involves the breakdown of the marital relationship (consortium vitae). Separation can only occur in the sense used by the Act where one or both of the spouses form the intention to sever or not to resume the marital relationship and act on that intention, or alternatively act as if the martial relationship has been severed. What comprises the marital relationship for each couple will vary. Marriage involves many elements some or all of which may be present in a particular marriage- elements such as dwelling under the same roof, sexual intercourse, mutual society and protection, recognition of the existence of the marriage by both spouses in public and private relationships, and the nurture and support of the children of the marriage.”
Consortium Vitae means:
“Marital intercourse, the dwelling under the same roof, society and protection, support, recognition in public and in private, correspondence during separation, making up as a whole the consortium vitae which the old writers distinguish from the divortium a mensa et thoro, may be regarded separately as different elements, the presence or absence of which go to show more or less conclusively that the matrimonial relationship does or does not exist Per Cussen J in Tulk v Tulk; Hoffmeyer v Hoffmeyer (1907) VLR 64 at 65”
Section 4AA of Act sets out the meaning of de facto relationship as follows:
(1) A person is in a de facto relationship with another person if:
(a) the persons are not legally married to each other; and
(b) the persons are not related by family (see subsection (6)); and
(c) having regard to all the circumstances of their relationship, they have a relationship as a couple living together on a genuine domestic basis.
Paragraph (c) has effect subject to subsection (5).
Working out if persons have a relationship as a couple
(2) Those circumstances may include any or all of the following:
(a) the duration of the relationship;
(b) the nature and extent of their common residence;
(c) whether a sexual relationship exists;
(d) the degree of financial dependence or interdependence, and any arrangements for financial support, between them;
(e) the ownership, use and acquisition of their property;
(f) the degree of mutual commitment to a shared life;
(g) whether the relationship is or was registered under a prescribed law of a State or Territory as a prescribed kind of relationship;
(h) the care and support of children;
(i) the reputation and public aspects of the relationship.
(3) No particular finding in relation to any circumstance is to be regarded as necessary in deciding whether the persons have a de facto relationship.
(4) A court determining whether a de facto relationship exists is entitled to have regard to such matters, and to attach such weight to any matter, as may seem appropriate to the court in the circumstances of the case.
(5) For the purposes of this Act:
(a) a de facto relationship can exist between 2 persons of different sexes and between 2 persons of the same sex; and
(b) a de facto relationship can exist even if one of the persons is legally married to someone else or in another de facto relationship.
When 2 persons are related by family
(6) For the purposes of subsection (1), 2 persons are related by family if:
(a) one is the child (including an adopted child) of the other; or
(b) one is another descendant of the other (even if the relationship between them is traced through an adoptive parent); or
(c) they have a parent in common (who may be an adoptive parent of either or both of them).
For this purpose, disregard whether an adoption is declared void or has ceased to have effect.
Section 4AA requires that the Court consider a number of matters in order to determine if a de facto relationship existed. The definition of a de facto relationship hinges on the concept of “a relationship as a couple living together on a genuine domestic basis”. Determining whether two parties were in a relationship as a couple living together involves the consideration of a number of factors, but some general observations can be made:
a)The Court must have regard to the quality of the parties’ relationship not simply the address that the parties live at to determine whether a de-facto relationship exists. See Greenwood v Merkel [2004] NSWSC 43 and Hayes v Marquis [2008] NSWCA 10.
b)The concept of “living together” is at the heart of a de facto relationship. It is important as it provides a distinction between parties living together as friends or flat mates.
c)While living together in a “common residence” and having a “sexual relationship” are common factors in a de facto relationship, neither are essential nor sufficient to establish that two parties are, in fact, “living together” as a couple on a genuine domestic basis.
d)A “mutual commitment to a shared life” is essential as without such commitment a de facto relationship cannot commence between the parties. In this regard, it is not sufficient that only one of the parties was committed to the relationship, but the other was not. A mutual commitment, however, need not be expressed, it may be inferred, depending on the facts of the case. Further, the degree of the parties’ mutual commitment is one of many of the factors to be considered in the overall evaluation of the parties’ relationship.
e)However, a “mutual commitment”, while essential, is not sufficient of itself. It is entirely foreseeable that there may be circumstances where two parties have a mutual commitment to a shared life, but are not “living together as a couple”. By way of example, parties may have made a commitment to move in together at a future date, but they had not yet commenced a physical cohabitation.
f)The financial relationship between the parties and their financial dependence and interdependence, ownership, use and acquisition of property often evidence the parties’ mutual commitment to a shared life.
g)The care and support of children of either or both of the parties will also often be a relevant consideration to the question of “mutual commitment”.
h)The reputation and public aspects of the parties’ relationship are often also important considerations when determining whether the parties were in a de facto relationship. If the parties’ friends and/or family consider them to be a couple, this may be considered external confirmation of the existence of a de facto relationship.
i)A de facto relationship does not end until the parties finally cease living together as a couple. Parties may spend some time apart or take some breaks from the relationship. However, the periods of time in which parties live in a de facto relationship can be aggregated to determine the overall length of that relationship, including periods which occurred before 1 March 2009 (See Dahl & Hamblin [2011] FamCAFC 202).
In determining whether a de facto relationship exists between the parties, the Court must consider the matters in s.4AA as relevant and weigh them up, while considering the specific facts of each individual case. As Professor Nicola Peart (University of Otago New Zealand) stated in her paper: “What’s New in Relationship Property and Succession”:
Finding whether a de facto relationship exists can be a complex exercise, involving evidence pointing in different directions. The consequences of finding a de facto relationship can be far-reaching and unexpected for some parties. The retrospective assessment has all the disadvantages of the “benefit of hindsight”. Had the parties known, they might have ordered their affairs differently. There is the well-known risk of litigants viewing their past conduct through a self-serving lens.
The Court accepts that it is the respondent who has viewed the past history of his relationship with the first applicant through a “self-serving sense”.
Mr I’s affidavit was read without cross-examination. That affidavit states no more than that the first applicant was employed by the (omitted business) . Mr I had met the respondent as a result of the respondent attending the (omitted business) offices. Mr I had a recollection of the respondent attending (omitted business) corporate dinners and less formal dinners for members of staff and staying overnight at conferences or other (omitted business) gatherings when the first applicant, otherwise, attended. All of that is consistent with both the first applicant and the respondent’s assertions as to the periods of time when they were, otherwise, in a de facto relationship. No weight is placed on Mr I’s evidence to determine the issues of disputation concerning the length of time of that relationship.
Mr W gave evidence as to knowing the respondent for some 50 years and attending with both the first applicant and the respondent when, he said, he observed the respondent paying for meals. His evidence that the first applicant was not in attendance at his marriage in (omitted) 1998 and his father’s funeral in (omitted) 1998 accords with the Court’s finding as to the parties’ de facto relationship ceasing to continue between December 1997 and June 1999. His evidence is, however, consistent with a de facto relationship existing between the first applicant and the respondent in late 2002, when he said that both “were together” as [the first applicant] had leased a property in the CBD of (omitted) for her business” and he and his wife had visited the premises and seen the respondent “at work doing the necessary refurbishments”, indicative of a mutual commitment to a shared life.
Mr A was again a close friend of the respondent who had met him on holiday in (omitted) 1994. He confirms having met the first applicant in (omitted) 1995 when she moved into the respondent’s home at the Property D property. His evidence was that he had observed the first applicant “doing cooking”, although he confirmed that when they went out to dinner, the respondent “always paid”. His evidence was further consistent with the parties having separated and not being in a de facto relationship in “early” 1999. He confirmed that in late 1999 the parties were again seeing each other. Similarly, he confirmed that the respondent was back in a relationship with his ex-wife, Ms A in about March 2000. This is all consistent with the Court’s findings referred to. Similarly, he deposes to the first applicant and the respondent being “back” in a relationship in about 2002, supportive of the first applicant’s position, rather than that of the respondent.
Ms G, being the respondent’s sister deposed to being introduced to the first applicant by the respondent in (omitted) 1995, as his “new girlfriend”. Her evidence was that the first applicant moved into the Property D property to assist the respondent in cooking. She confirmed that the first applicant, with her son and daughter, did move in and that she was cooking, albeit she said that the respondent informed her that “the kids don’t like her food” and that she had suggested to the respondent that Ms O prepare meals, which could then be reheated by the first applicant. She confirmed that the first applicant did not attend the respondent’s mother’s funeral in (omitted) 2000 and that as at Christmas 2001, although the first applicant and respondent were once again “seeing each other”, the first applicant had said to her at the time: “We’re just friends, I really like Mr Cowper and enjoy his company.” She asserts that in early 2002, the first applicant had come up to her (in the presence of the respondent and his former wife) and stated: “I am going to kill myself if you don’t stop seeing your ex-wife”. Ms G had some difficulties in accepting that this would have been an unusual statement to make if the first applicant had not been in some form of close relationship with the respondent at that time. This was, indeed, supportive of the position that the respondent did, thereafter, resume a de facto relationship with the first applicant in about February 2002. Similarly, if her evidence as to a conversation with the respondent concerning the first applicant’s hospitalisation in early 2002 is to be accepted, it again supports a continuing relationship with the first applicant and the respondent in that he stated: “I have got to go and see her”. Her evidence as to a conversation in August 2009 with the respondent that the first applicant was to pay rent at the Property G property and then “earn 25% of the property after 6 years of paying rent” was inconsistent with the respondent’s own case and introduced an element that the respondent had not, in fact, relied upon, himself. Such an arrangement was inconsistent with the title being acquired by the first applicant and the respondent jointly, as the legal title documents reflect.
The Court could not accept Ms G’s evidence when it departed from that of the first applicant as the Court did not consider that her evidence was objectively and honestly given. From the witness box she advocated the respondent’s position, confirmed that her evidence was largely that which that she had been told about by the respondent, exaggerated her knowledge of the respondent’s living arrangements and asserted that the first applicant was no more than a “gold digger”. She had also been involved in lodging affidavits on behalf of the respondent and asserted that she had seen “all the paperwork”. She had difficulty conceding that her own affidavit acknowledged that the first applicant, in communicating with her and with others, had asserted that she was in a de facto relationship with the respondent. While the first applicant did not concede that she had ever threatened self-harm, Ms G asserted that the first applicant had done so when she said she became aware of the respondent continuing a relationship with his ex-wife and this was so, notwithstanding that only one month earlier she had asserted that the first applicant had claimed that she and the respondent were just friends. Such an extreme reaction from the first applicant, if it occurred as deposed to by Ms G, would have been more consistent with the first applicant being in an intimate de facto relationship as maintained by her, than simply being “friends” with the respondent, as asserted by Ms G.
Ms G also asserted that the first applicant had made representations that she, as a “de facto”, would make no claim against the respondent’s property. This again appeared inconsistent with Ms G’s evidence that the first applicant was only a friend. Her evidence was also inconsistent with the conceded position of the respondent concerning the time periods that the parties had lived in a de facto relationship. Indeed, paragraph 16 of her affidavit stated that she understood that they had been in a relationship for 10 months, when she calculated that, this appeared to be “8” months from September to April (which, in fact, calculates at 7 months), while the respondent concedes a relationship from August 1995 to June 1996 being, in fact, 10 months.
Ms A, the respondent’s ex-wife, confirmed that she had loved the respondent and continues to do so. She confirmed that she had had a relationship with the respondent for about 4-6 months commencing in about January 1999 and ending at the latest in June 1999. At the conclusion of this relationship, she said the respondent started seeing the first applicant again. Weight is attached to her evidence in that regard. This is entirely consistent with the Court’s findings referred to. Similarly, she confirmed that in about December 1999/January 2000, there was a “separation” between the first applicant and the respondent. She said that her relationship with the respondent resumed until about mid-2001. This is, again, consistent with the Court’s findings as to the period of time when the parties were not in a de facto relationship, namely between about November 1999 and January 2002. She conceded that her evidence was inconsistent when she said she could not recall that the respondent had stayed over at her home following Ms S’s wedding, noting that he had driven them there, but then in re-examination she asserted that he had stayed overnight with her. Her evidence in chief was also that the respondent had advised her that he was moving up to the (omitted) with the first applicant to buy a house with her. The Court does not accept her evidence that the respondent had stayed with her the night of Ms S’s wedding, when the first applicant had deposed to him staying with her that night. The Court is of the view that Ms A’s recollection of that night was to a large extent moulded so as to assist the respondent in his version of the events.
Ms B, as the respondent’s eldest daughter, gave evidence. She confirmed that shortly after August 1995 when she was introduced to the first applicant, the first applicant had moved into the home at the Property D property and lived with them until about June 1996 when, she said, the first applicant’s relationship with the respondent broke down. She, however, deposed to moving out of that property when she said that the first applicant was still living there. As such, she is not able to say that the relationship between the first applicant and the respondent did not continue to at least December 1997, as the Court finds it did. Her evidence is consistent with the parties again spending time together at the end of 2000 and purchasing together property in 2002. She deposes to a conversation with the respondent, to the effect that the respondent stated to her: “we are getting a split loan, she will be responsible for hers and I will be responsible for mine”. This conversation is inconsistent with the respondent’s evidence as he says, he had no input into setting up a split loan, as that was a requirement of the lender. While she says that she continued to visit the respondent between 2002 and 2005 in Property B, her evidence that the first applicant was not there is not surprising given that, at that time, the first applicant was then residing on the (omitted). She confirms that the respondent “moved in” with the first applicant in 2005 and this is supportive of the first applicant’s position, rather than that of the respondent. She sets out a conversation with the respondent on one of her visits to the Property H property and states that the respondent had said: “I am looking at buying another property for the (omitted) business I am going to start” and she had said: “Dad is it just you? You’re not buying this with your money and putting her [the first applicant] on title?” with him then responding: “No, I have no intention of doing that.” This appears entirely inconsistent with what, in fact happened, namely the first applicant’s name was recorded on the title. Subsequently, she learned that the property was jointly acquired and after a conversation with her sister, Ms S, wherein Ms S is said to have said: “He seems to think its ok for her to be on title because he has agreed to give her the use of the front two rooms for use as a home/office for her business”, she responded: “what an idiot” [referring to the respondent, her father]. This conversation is again, somewhat inconsistent with the respondents own position as to how that title was ultimately recorded. The Court accepts that the respondent at the relevant times was an astute business man who had bought and sold properties, conducted a building and other businesses and utilised the services of solicitors and accountants. The Court therefore accepts that the registered titles of the various properties reflected the parties then shared intent as to joint property ownership.
Ms S, as the respondent’s youngest daughter, gave evidence by telephone confirming meeting the first applicant in about 1995 and being absent from the Property D property until December 1998. She confirms that there was no ongoing relationship between the first applicant and the respondent in around December 1998. That is consistent with the Court’s findings referred to. She, further, deposes to any relationship between the respondent and his ex-wife ceasing in July 1999, when the respondent visited the first applicant who, she said, was then in hospital and that they had resumed a relationship in around July 1999. She maintains, however, that the parties terminated their relationship in about December 1999. This is inconsistent with both parties’ concessions that their relationship terminated in about October 1999. She confirmed that the first applicant did not attend her wedding on 27 August 2000 and that is also consistent with the Court’s finding as to there being no de facto relationship, at that time. She deposed to the respondent providing rent free accommodation for her, her husband and her daughter in the Property A property until about February 2003, when she moved to live in (country omitted) and the respondent having provided her with a gift of $50,000.00 to purchase and fix up a house at (country omitted). She says that when her own marriage broke down in (omitted) 2004, she moved back to Sydney with her daughter and had lived, rent free with no obligation to pay any bills, at the Property B property. Her evidence is consistent with visiting the first applicant and the respondent at the Property H property from 2004 onwards. In April 2007, she said that she had moved to (omitted) to be closer to the respondent and to her husband with whom she had resumed a relationship. She confirmed that the respondent had provided financial support for her and her daughters, A and B. She also confirmed that her sister, Ms B, had purchased half of unit 1 at the Property A property and her brother, Mr J, had purchased unit 3 at the Property A property and that the respondent had sold unit 2 and assisted her to purchase Property I. The Court does not accept the terms of the conversations asserted by Ms S with the first applicant, to the extent that she says that the first applicant claimed no right in the property at Property G. While it might be somewhat surprising for Ms S to have had a conversation with the first applicant in the terms deposed to, including saying to her: “Are you also going to repay Dad the money he lent you for the business?”, the first applicant’s response of “Yes”, is not surprising, given the position maintained by her throughout these proceedings in relation to the financial arrangement concerning the $75,000.00 loan, referred to in paragraph 24(aaa) above.
Mr J, the respondent’s son, confirmed that he had obtained a “brief commission based role with (omitted business)”, with the assistance of the first applicant. His evidence of moving in with the respondent into a town house which was built and owned by him in the Property A property, around the end of 1998, is consistent with there being no de facto relationship existing at that time between the first applicant and the respondent. He confirms that in around 2006, he had a conversation with the respondent to the effect that the respondent’s acquisition of the Property A property was considered by him as a mechanism to look after each of his children. This is, in effect, what has occurred by the respondents’ use of that property.
The Court had some difficulties in accepting all of the evidence of the respondent. He completely undervalued any contribution made by the first applicant and was so negative towards her that the Court was left in significant doubt as to his version of the events when they differed from that of the first applicant. The first applicant, on the other hand, did not seek to undervalue the efforts of the respondent and she is to be given credit in that regard. The respondent deposed in paragraph 4 of his affidavit sworn 9 February 2011 so as to contradict the first applicant’s evidence that the name of his youngest child was “Ms S”. Nevertheless, in his affidavit of 16 April 2012, in paragraph 13, he refers to his youngest child as “Ms S”. This pettiness pervaded the respondent’s approach to the first applicant. Throughout the conduct of the matter, the respondent was completely disparaging of any efforts of the first applicant and of her legal representatives. The respondent’s affidavit material, on the other hand, when it had been prepared by his legal representatives, presented a much more “even handed” approach. As said, his response referred to in paragraph 4 above, refers to a period of cohabitation as a de facto couple of some 4 years and 9 months, satisfying the jurisdictional question that the relationship existed for “at least 2 years”. The respondent’s affidavit material prepared with the assistance of his legal representatives conceded that the first applicant worked in employment, purchased groceries from time to time, contributed to utility costs, attended to household cleaning and meal preparation. The respondent did not call any evidence from a part time housekeeper who, it was said by him, prepared the meals simply to be warmed up by the first applicant. This was also inconsistent with his oral evidence that what the first applicant cooked she “burnt” the food. The respondent in seeking to minimise any financial assistance by the first applicant denied that he consumed her consumables stating that “we went out for dinners most of the time”. Again, this would appear to support an ongoing de facto relationship during the periods that they ate out. The respondent’s position appeared to be that he accepted no responsibility or any obligation to the first applicant as he only saw such an obligation arising if there had been children of the relationship. He asserted, on numerous times, that his property on his death was to “go to his children”. Similarly, the adult children called in support of his case reiterated that position, given that it was, potentially, of financial benefit for them to do so. The respondent’s evidence as to the first applicant having an obligation to pay rent and then “not paying” it, or that he relied on her advice as his “bank manager” appeared disingenuous to the extreme.
In this regard, the Court has considered each of the matters detailed in s.4AA(2) of the Act.
(a) the duration of the relationship
The respondent concedes he was in a de facto relationship but does not accept the period of time asserted by the first applicant. The Court has set out above the circumstances of the parties’ relationship as a de facto couple so as to determine its overall duration at 10 years and 7 months.
(b) the nature and extent of their common residence
The Court has set out above the circumstances of the parties’ common residences during the periods of their relationship. At times, the parties resided in a common residence and at other times they were geographically separated for the purposes of their work commitments with the respondent working in Sydney and the first applicant in (omitted).
(c) whether a sexual relationship exists
The Court is satisfied that during the periods of cohabitation the parties maintained a sexual relationship.
(d) the degree of financial dependence or interdependence, and any arrangements for financial support, between them
The Court is satisfied that whilst the parties maintained some financial independence, there were arrangements between them which provided for the acquisition of property, joint mortgages and the payment of monies to provide for each other’s financial support, during the period of their relationship.
(e) the ownership, use and acquisition of their property
The Court is satisfied that the parties acquired real estate jointly for the purposes of their ongoing relationship, during the period of that relationship.
(f) the degree of mutual commitment to a shared life
The Court is satisfied that while together as a couple, each provided the other with a mutual commitment to a shared life which only came to an end in February 2010, when the parties separated.
(g) whether the relationship is or was registered under a prescribed law of a State or Territory as a prescribed kind of relationship
There is no evidence of the parties’ relationship being registered in any way.
(h) the care and support of children
There are no children of the relationship, although both parties had children of other relationships who are, at the time of the final hearing, all adults. Indeed, when the parties lived at the Property D property, some of both the first applicant’s and the respondent’s children also resided with them. During other periods of cohabitation as referred to above, various of the parties’ children also lived with the first applicant and the respondent on an “on and off” basis. The respondent assisted the first applicant’s children in (omitted) works at their properties at (omitted) and (omitted).
(i) the reputation and public aspects of the relationship
During the periods of cohabitation, the first applicant and the respondent attended clubs for meals together and played the poker machines. The respondent conceded that he liked playing “the pokies” and asserted that the first applicant had introduced them to him. While the respondent claims that he paid for all entertainment and holidays, he did not dispute that he and the first applicant had entertainment and holidays together and that he had provided the first applicant with “expensive gifts of jewellery and gifts such as a portable GPS device and… laptop computer, including exchanging Christmas gifts for all children and the occasional Easter gift”.
The Court accepts that at the times the parties’ cohabitated whether in the same residence or not, they held themselves out as a couple. In the periods they did not so cohabit, their relationship had come to an end.
The Court also accepts in terms of the above factors that:
a)The first applicant and the respondent maintained during the course of their relationship separate bank accounts, apart from those the subject of various joint loans. Notwithstanding this, during the periods September 2002 to August 2004, the respondent transferred to the first applicant some $16,700.00 into her accounts and in the period June 2006 to September 2009, the first applicant transferred some $15,062.00 to the respondent into his accounts with respect to the Property H property;
b)The first applicant set up the business of the second applicant without substantially involving the respondent in its business structure or running. Nevertheless, the respondent supported the first applicant in her conduct of the (omitted business) business by attending social functions, corporate dinners and conferences as confirmed by Mr I.
c)While the respondent claimed that he had been “dating other women” during various periods when he said he was no longer living in a de facto relationship with the first applicant, no evidence was called from such “other women”, save for his former wife. The Court infers that if such other women were called, their evidence would not have assisted the respondent.
d)While the parties’ maintained separate households between February 2002 and mid-2005, that was as a result of the first applicant moving to the (omitted) and the respondent continuing to work in Sydney. Notwithstanding that position, the Court is satisfied that they maintained a de facto relationship during that period, purchasing property together and borrowing on the security of the purchased property. They continued to hold themselves out as a couple living in a committed relationship as husband and wife.
e)The assertion by the respondent that the title of properties registered as joint tenants was in error, was not established on the evidence. No evidence was called from any solicitor/conveyancer as to any asserted error, namely that the first applicant should have been an owner as to a one-quarter share only. The Court is satisfied that the respondent was well aware of the consequences of acquiring a property as joint tenants. The respondent refers, in his evidence, to conversations with Mr A and his then adult children about the asserted failure of the first applicant to put any funds in towards the purchase of real estate and, if the Court accepts that such conversations occurred, the respondent did nothing about that. The respondent in alleging that he had left those matters to the first applicant or that the first applicant had, without his authority, instructed conveyancers to record the titles as joint tenants, contrary to his instructions, did not ring true. The Court does not accept the respondent’s assertions in that regard. The Court accepts that the respondent was a man of some commercial acumen and experience, in particular, in the sale and purchase of real estate and in instructing solicitors and would more than likely, if he had wished to, been able to obtain legal advice for the structuring of any legal arrangement with the first applicant, which may have potentially dealt with the issues raised by him. The fact that none of these matters were raised until after separation indicates that they were not matters at the forefront of the respondent’s mind when entering into the purchase of real estate with the first applicant, as currently the subject of record on title. The respondent did not call any evidence from a Mr R in respect of the asserted error in the purchase of the Property G property and the Court infers that if he had, Mr R’s evidence would not have assisted him. Mr R provided an email dated 2 March 2012, which expressed surprise at the respondent’s assertion and stated that the respondent and the first applicant purchased the property at auction and signed and exchanged contracts as joint tenants and that Mr R’s firm was only engaged after contracts were exchanged.
Using the questions outlined above, the Court finds the following:
a)On both the first applicant and the respondent’s case, the parties’ relationship did not break down before 1 March 2009, and in fact, broke down on 28 February 2010.
b)The relationship was one that meets the definition of a “de facto relationship as prescribed by s.4AA of the Act, conceded by both parties at varying times.
c)The de facto relationship existed for “at least two years”, and, in fact, existed for 10 years and 7 months over the periods referred to below.
The Court finds that, notwithstanding the first applicant’s assertion of a continuing relationship in the periods as set out in paragraph 24(h) above, the parties had separated as at January 1999 and November 1999 to the effect that in the periods January 1998 to June 1999 and November 1999 to January 2002, they were not living in a de facto relationship.
The Court finds that the first applicant and the respondent cohabitated as a de facto couple in the periods August 1995 to December 1997, July 1999 to October 1999 and February 2002 to 28 February 2010.
The approach to be taken
Both parties assert and the Court accepts that, in all the circumstances, it is just and equitable that there should be a property adjustment order in terms of the High Court of Australia’s decision in Stanford v Stanford [2012] HCA 52.
The preferred approach to the determination of an application under s.90SM of the Act follows the procedure as set out by the Full Court of the Family Court of Australia in the case of Hickey v Hickey & Attorney-General of the Commonwealth (Intervener) (2003) FLC 93-143, which sets out the following four inter-related steps:
1. Identify and value, as at the date of hearing, the parties’ property, liabilities and financial resources;
2. Identify and assess the contributions (“the first limb – the contribution factors”) of the parties and express them as a percentage of the net value of the property (examined on either a global approach or an asset by asset approach, depending on the circumstances of the case);
3. Identify and assess the other factors relevant (“the second limb – ongoing needs and effect of orders”) including, the matters referred to in s.90SF and determine the adjustment (if any) to be made to the contribution entitlements at step two; and
4. Consider the effect of the above and resolve what order is just and equitable in all the circumstances of the case.
In undertaking the first step outlined above, the Court must act with reasonable precision in both identifying and valuing the property pool. However, in the subsequent steps, the Court is not required to assess contributions with mathematical precision. See Nygh J. in G & G (1984) FLC 91-582.
Section 90SM of the Act [Matters to be taken into account]
In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
a)the financial contribution made directly or indirectly by or on behalf of a party to the de-facto relationship or a child of the de-facto relationship to the acquisition, conservation or improvement of any of the property of the parties to the de-facto relationship 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 de-facto relationship 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 de-facto relationship or a child of the de-facto relationship to the acquisition, conservation or improvement of any of the property of the parties to the de-facto relationship 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 de-facto relationship or either of them; and
c)the contribution made by a party to the de-facto relationship to the welfare of the family constituted by the parties to the de-facto relationship and any children of the de-facto relationship, 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 de-facto relationship; and
e)the matters referred to in subsection 90SF(3) so far as they are relevant; and
f)any other order made under this Act affecting a party to the de-facto relationship or a child of the de-facto relationship; and
g)any child support under the Child Support (Assessment) Act 1989 that a party to the de-facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the de-facto relationship.
Section 90SF(3) of the Act [Matters]
The matters to be so taken into account are:
a)the age and state of health of each of the parties to the de-facto relationship;
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;
c)whether either party has the care or control of a child of the de-facto relationship who has not attained the age of 18 years;
d)commitments of each of the parties that are necessary to enable the party to support:
i)himself or herself; and
ii)a child or another person that the party has a duty to maintain;
e)the responsibilities of either party to support any other person;
f)subject to subsection (4) 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 the rate of any such pension, allowance or benefit being paid to either party;
g)a standard of living that in all the circumstances is reasonable;
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;
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;
k)the duration of the de-facto relationship and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
l)the need to protect a party who wishes to continue that party's role as a parent;
m)if either party is cohabiting with another person, the financial circumstances relating to the cohabitation;
n)the terms of any order made or proposed to be made under section 90SM in relation to:
i)the property of the parties; or
ii)vested bankruptcy property in relation to a bankrupt party;
o) the terms of any order or declaration made, or proposed to be made, under this Part in relation to:
i)a party to the subject de-facto relationship (in relation to another defacto relationship); or
ii)a person who is a party to another de facto relationship with a party to the subject de-facto relationship; or
iii)the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
p)the terms of any order or declaration made, or proposed to be made, under Part VIII in relation to:
(i) a party to the subject de facto relationship; or
(ii)a person who is a party to a marriage with a party to the subject de facto relationship; or
(iii)the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
q)any child support under the Child Support (Assessment) Act 1989 that a party to the subject de-facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the subject de-facto relationship; and
r)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
s)the terms of any Part VIIIAB financial agreement that is binding on either or both of the parties to the subject de-facto relationship; and
t) the terms of any financial agreement that is binding on a party to the subject de-facto relationship.
Direct and Indirect Non-Financial Contributions
The first applicant’s evidence was that her personal assistance in relation to some of the renovations related to largely cleaning up. She stated that she was not a builder and left those matters to the respondent, who was a builder.
The first applicant conceded that she had made no direct or indirect non-financial contributions to the respondent’s properties at the Property D, the Property A or the Property B property. Again, the first applicant’s evidence did not seek to undervalue the contributions of the respondent and conceded matters where it was appropriate to do so. The Court accepts her evidence in that regard.
The first applicant gave evidence that she recalled being involved in the paperwork for the development and Council approval for the sub-divisions at the Property A property. However, she acknowledged that she made no financial contributions in respect of that.
The first applicant conceded that the respondent had done building work on the jointly owned properties including, sanding, painting, parquetry flooring, installing light fittings, power points and broad band cabling, building a garage, moving fencing, installing guttering and rainwater tanks, carrying out electrical and plumbing work and while planting some citrus trees, the first applicant was of the view that the respondent had effected little gardening given, she said, “the state of it”. These works were consistent with the respondent’s qualification as a builder.
The first applicant’s intention was to move the (omitted business) to the Property G property. She appears to have operated her business there in the afternoon, but substantially the business continued at the Property N office in (omitted).
The first applicant says, and the Court accepts, that she assisted the respondent in processing claim documents, preparing spreadsheets and loading (omitted) on the back of a truck, in respect of the respondent’s (omitted) business, then commenced to take up the benefits of operating the Australian Government (omitted) Program. A development application was needed for a storage facility for the (omitted) at the Property G property. Notwithstanding a request made for the first applicant to join in to seek that consent, the respondent says that the she refused to do so. The (omitted) were, therefore, stored outside and have to an extent, apparently deteriorated in quality. No independent evidence has been called in that regard. The first applicant stated that she had refused her consent because she had received a nasty and threatening phone call. It would appear that the respondent had been fined in relation to the storage of those (omitted) and had been given notice to remove them by a specified date. The first applicant was unaware of any such removal date. Notwithstanding this, the Court accepts that the first applicant was at least involved in the respondent’s (omitted) installation business through the continued use of the Property G property for storage purposes. The respondent’s evidence was that, notwithstanding any deterioration, he was still in the process of selling the remaining (omitted) for ongoing installation by contractors not engaged by him but at a greatly reduced price. There was no independent evidence as to this continuing income stream.
The first applicant’s claim was essentially based on her doing the cooking, grocery shopping, ironing and general housework around the various properties that the parties had lived in. The first applicant conceded that the respondent maintained the pool and the first applicant’s daughter, on occasion, saw him gardening. The Court accepts that the respondent would have carried out maintenance on the various jointly owned properties, given his professional building experience. The Court accepts, further his evidence that he would have done that work without expending money to pay others to do the same and weight is attached to that.
The first applicant’s evidence was that she did all the cooking and cleaning. Her evidence that she, in particular made a special effort to prepare meals that the respondent liked had a real ring of truth to it, given as she records, his love of food and her evidence that he was somewhat “messy”, entailed her doing substantially all of the cleaning.
While it was put to the first applicant that it was of little additional effort to her to prepare meals for the respondent or to do his laundry (given that she was also doing that for herself and the children), the Court accepts that she, nevertheless, contributed in that sense.
The first applicant conceded that she, on occasion, worked on the weekends as part of the (omitted) Business Franchise and that she worked between 8/8.30am to 5pm Mondays to Fridays.
The first applicant was cross-examined at the recommencement of the proceedings on 26 March 2013 by the respondent. She was shown Exhibit “9” which was a letter written by her solicitor, Katie Smith, to LAC Lawyers which asserted that, at the time, the respondent was involved in proceedings with his former spouse in the Court the parties were cohabiting. As the evidence indicates, the matter was heard in the Family Court of Australia between 15 and 18 November 1994 before Justice Moss with a decision handed down on 15 December 1994, which was then subject to an appeal concluded in May 1995. The first applicant, conceded that there was an error in that letter as, on her version, the parties were not cohabiting at the time those proceedings were being conducted, as cohabitation commenced in August 1995.
The Court is satisfied that the parties non-financial contributions were approximately equal during the term of their relationship.
What were the parties’ contributions to the welfare of the family, including those in the capacity of homemaker or parent?
The Court accepts the first applicant’s evidence that she purchased, from time to time, gifts for the respondent’s family and entertained the respondent’s family when they were, otherwise, spending time with the respondent and her.
The first applicant’s evidence, which the Court accepts, was that all of her income generated from her employment throughout the period of the parties’ relationship was applied towards the payment of mortgage debt, household and general living expenses, including outings, entertainment, holidays and some gambling at local clubs. The existing assets and liabilities of the parties reflect that position.
Given the evidence of the respondent and of his children, it is highly likely that he paid for most of the restaurant dining and the Court accepts that the parties ate out at restaurants or clubs whenever the respondent’s children travelled up to the (omitted) area and spent time with them. Nevertheless, the Court accepts that it is likely that the respondent would have similarly treated money available to the first applicant through the operation of her business and the various loan sums generated by him where the proceeds were transferred to the first applicant as monies, otherwise, available to him. The Court accepts, in that regard, that it is likely that the first applicant did make available cash monies to the respondent from her various accounts/credit card facilities, as and when needed by both of them.
The first applicant submits that her contribution entitlement should be assessed at 20% to the respondent’s 80%.
The respondent submits that his contribution entitlement should be assessed at 100% to the applicant’s 0%. The Court accepts that the respondent’s position would amount to an inconceivable result, even on the facts as asserted by him.
Weighing all of the factors relating to contributions, both financial and non-financial, the Court assesses the first applicant’s contribution entitlement at 23.5% and the respondent’s at 76.5%, being $303,820.22 and $989,031.78 respectively. The Court has increased the first applicant’s percentage from that sought by her having regard to the determination of the property pool and excluding the assets and liabilities as identified above, given that the first applicant had had regard to a larger property pool.
What is the effect, if any, of any proposed order upon the parties’ earning capacity?
The proposed orders do not impact on the earning capacity of either the respondent or the first applicant.
Any adjustment under s.90SF of the Act?
The first applicant submits that an adjustment should be made referable to the following factors in the percentage submitted. The respondent submits that there should be no adjustment.
a) the age and state of health of each of the parties to the de-facto relationship;
The first applicant is currently 64 years of age and says she is in good health.
The respondent is currently 68 years of age and says that he is in good health, apart from recently undergoing pelvic cancer surgery.
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;
The first applicant worked for (omitted business) up until the surrender of the franchise territory on 30 June 2010. She, thereafter, obtained part-time employment with a (employer omitted). The first applicant has the capacity for that type of employment to continue and weight is attached to that.
The first applicant had received trail commissions through her company’s operation of the (omitted business) franchise at (omitted), although these will reduce over time. The current valuation of the first applicant’s interest in the (omitted business) franchise is valued at $nil.
The first applicant has been renting out the Property H property and receiving rent which has been utilised to pay the mortgage on the Property H property. If the first applicant was to reside in the Property H property, this source of income would cease.
The respondent traded under the business name of (business omitted) and described himself as semi-retired. He continues to do some building work but it would appear to be only for family and friends. He has access to some income-generating assets but has not taken up the opportunity to receive such income. He is not currently in remunerative employment.
The respondent has access to greater financial assets than the first applicant and weight is attached to that.
The respondent’s daughter, Ms B, lives in one of the 3 dual occupancy properties at the Property B property. She pays no rent for that occupation, but provides that her rent for her half share of unit 1 of the Property A property is paid in reduction of the existing debt on that property, by way of a “rent” payment to the respondent. The respondent, it would appear, received rent from the other two occupants of that property. As that property is owned by the respondent, is not occupied by him and is a source of rental income, it is likely that he would be able to borrow against its security, given that rental income and noting that he has no current income from employment.
c) whether either party has the care or control of a child of the de-facto relationship who has not attained the age of 18 years;
No relevant matter was put to the Court concerning this factor.
d) commitments of each of the parties that are necessary to enable the party to support:
i) himself or herself; and
The first applicant submits she has a financial need to house herself and weight is attached to that.
Her personal expenditure as set out in her latest financial statement of $900.00 per week exceeded that of her then income of $850.00. The first applicant was not the subject of any cross-examination concerning her financial commitments and these are accepted.
ii) a child or another person that the party has a duty to maintain;
No relevant matter was put to the Court concerning this factor.
e) the responsibilities of either party to support any other person;
No relevant matter was put to the Court concerning this factor.
f) subject to subsection (4) the eligibility of either party for a pension, allowance or benefit under:
i) any law of the Commonwealth Bank, 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 the rate of any such pension, allowance or benefit being paid to either party
The first applicant and respondent disclose that they have no superannuation.
g) a standard of living that in all the circumstances is reasonable;
The first applicant submits that she has a need for a reasonable standard of living.
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;
No relevant matter was put to the Court concerning this factor.
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
While no relevant matter was put to the Court concerning this factor, the Court has had regard to the first applicant’s liability in respect of legal fees incurred by her in the conduct of these proceedings referred to in paragraph 84 above and some weight is attached to that.
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;
The first applicant submits that as a result of a significant contribution to the assets retained by the respondent to her exclusion, there should be an adjustment in her favour.
k) the duration of the de facto relationship and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
The Court finds that a de facto relationship existed between the first applicant and the respondent for a period of 10 years and 7 months and that during this period there was a significant blending of assets, particularly real estate.
l) the need to protect a party who wishes to continue that party's role as a parent;
No relevant matter was put to the Court concerning this factor.
m) if either party is cohabiting with another person, the financial circumstances relating to the cohabitation;
The first applicant has, since separation, at most times lived on her own. At some times, she has lived with her adult son, Mr S.
n) the terms of any order made or proposed to be made under section 90SM in relation to:
i) the property of the parties; or
ii) vested bankruptcy property in relation to a bankrupt party
The first applicant seeks the orders set out in her proposal.
The respondent asks the Court to dismiss the first applicant’s application, which the first applicant maintains is not reasonable, just or equitable in the circumstances.
o) the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
i) a party to the marriage; or
ii) a person who is a party to a de facto relationship with a party to the marriage; or
iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
The first applicant seeks the orders set out in her proposal.
The respondent asks the Court to dismiss the first applicant’s application, which the first applicant maintains is not reasonable, just or equitable in the circumstances.
p)the terms of any order or declaration made, or proposed to be made, under Part VIII in relation to:
(i) a party to the subject de facto relationship; or
a person who is a party to a marriage with a party to the subject de facto relationship; or
the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); an
The first applicant seeks the orders set out in her proposal.
The respondent asks the Court to dismiss the first applicant’s application, which the first applicant maintains is not reasonable, just or equitable in the circumstances.
q) any child support under the Child Support (Assessment) Act 1989 that a party to the subject de-facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the subject de-facto relationship; and
No relevant matter was put to the Court concerning this factor.
r) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
No relevant matter was put to the Court concerning this factor.
s) the terms of any Part VIIIAB financial agreement that is binding on either or both of the parties to the subject de-facto relationship; and
No relevant matter was put to the Court concerning this factor.
t) the terms of any financial agreement that is binding on a party to the subject de-facto relationship.
No relevant matter was put to the Court concerning this factor.
The first applicant submits that an adjustment of a further 5% should be made in her favour.
The respondent submits that there should be no adjustment as he argues that there should be no payment/distribution of property to the first applicant, in any event. His application is simply for the dismissal of the first applicant’s application. This would not achieve the outcome that he seeks given that real estate would continue to stand in the joint names of both the first applicant and himself.
Considering then all of the above s.90SF factors, the Court is of the view that there should be an adjustment of 5% made in favour of the first applicant equating to approximately $64,642.60. This, the Court regards, as a proper adjustment given the parties age, health and current earning positions and weighing the factors set out above. This outcome reflects the cumulative outcome of the findings made pursuant to s.90SF. See Tomasetti & Tomasetti (2000) FLC 93-023. Any lesser adjustment, given the size of the property pool, would be notional.
Accordingly, the first applicant would be entitled to receive 28.5% of the net property pool being $368,462.82 and the respondent would be entitled to receive the balance of 71.5% being $924,389.18.
Are the proposed orders just and equitable?
Section 90SM(3) 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.”
It is the justice and equity of the actual orders that the Court must consider. Russell & Russell (1999) FLC 92-877.
As the Full Court of the Family Court of Australia said in Dickson & Dickson (1999) FLC 92-843:
“Whilst it may, as a matter of individual circumstance, be correct to say that the mere existence of disparity of wealth ought not of itself justify a settlement of property to one party at the expense of the other, it may often, in the overall circumstances of a case, call for further adjustment beyond that assessed on contributions alone, so that the final order is just and equitable…”
The first applicant and respondent will therefore receive the property and be liable for the debts as set out in the following tables:
| Property to be retained by the first applicant | $ |
| The Property H property | 440,000.00 |
| (omitted) Bank | 1,574.00 |
| Motor vehicle | 15,000.00 |
| Furniture and household contents | 2,000.00 |
| TOTAL | 458,574.00 |
| Liabilities to be met by the first applicant | |
| (omitted) credit cards | 18,248.00 |
| TOTAL NET PROPERTY | 440,326.00 |
| Less adjustment sum to be paid to the respondent | 71,863.18 |
| BALANCE TO THE FIRST APPLICANT | 368,462.82 |
| Property to be retained by the respondent | $ |
| The Property G property | 300,000.00 |
| The Property B property | 885,000.00 |
| (omitted) Bank accounts | 1,749.00 |
| (omitted) shares | 47,707.00 |
| Motor vehicle | 5,000.00 |
| Furniture and household contents | 5,000.00 |
| TOTAL | 1,244,456.00 |
| Liabilities to be met by respondent | |
| Mortgage over the Property H property | 314,442.00 |
| (omitted) Master card | 5,488.00 |
| Debt to Commonwealth Government | 72,000.00 |
| TOTAL LIABILITIES | 391,930.00 |
| TOTAL NET PROPERTY | 852,526.00 |
| Plus the adjustment sum paid by the first applicant | 71,863.18 |
| BALANCE TO THE RESPONDENT | 924,389.18 |
The first applicant says and the Court accepts that the respondent has Unit 1 in the Property A property, valued as set out in paragraph 68 above and greater financial resources available to him in the form of that property and the sums gifted to his adult children, in terms that his children have supported him, in being able to secure borrowings against the real estate jointly owned with him.
The first applicant wishes the opportunity to acquire the Property H property and the orders proposed will achieve that outcome.
The orders which provide for the transfer of the Property H property to the first applicant would necessarily envisage the payment out/refinance/discharge of the mortgage secured on that property and the payment to the respondent of the adjustment sum, referred in the schedule above. If the mortgagee’s consent and/or the payment of the adjustment sum cannot be effected, then the Property H property will need to be sold and the proceeds distributed. Given the existence of a mortgage on the Property H property to the agreed extent of some $314,442.00 (being 71.46% of its agreed value), the appropriate orders would see the full sum after payment of the costs associated with effecting the sale paid to the respondent, which would then necessitate him paying to the first applicant the sum of $368,136.82 which together with her net assets of $326.00 totals $368,462.82.
The Court’s orders will provide for a period of 42 days for a transfer of the Property H property to the first applicant and the payment by the first applicant to the respondent of $71,863.18 less the sum of $10,000.00 being $61,863.18 (the “settlement sum”). If that could not be achieved within a period of 70 days from the date of the orders, the Property H property would then be sold and the sum referred to in paragraph 191 of $368,136.82 plus the sum of $10,000.00, totalling $378,136.82, would then be payable to the first applicant by the respondent.
In assessing whether or not this is a just and equitable outcome, the Court has formed the view that the parties would not seek to enforce as against each other the issue of $75,000.00 advanced by the respondent to the first applicant and used by the first applicant in the business conducted by the second applicant. These funds were used to set up and acquire the business which now has a nil value. The business generated an income which the Court has found was utilised by both parties in meeting their general living expenses. While the first applicant maintained that it was a loan and she understood, that at a time, there was a value in the business of the second applicant which could be used to repay that loan, that appears not now to be the case. In the circumstances, the Court is of the view that the first applicant would, nevertheless, be entitled to recover the costs of $10,000.00 as ordered in the Supreme Court of New South Wales against the respondent and that this sum should be included by way of a reduction in the adjustment of the sum payable to the respondent of $71,863.18 by reducing that payment by the said $10,000.00 to $61,863.18. If, however, that sum is not paid as part of the transfer of the Property H property to the first applicant, namely that orders 3, 4 & 5 are not implemented, then the first applicant would be entitled to recover the sum of $10,000.00 in addition to the sum that the respondent would otherwise be ordered to pay the first applicant, if the Property H property has to be sold, namely $368,136.82 plus $10,000.00 totalling $378,136.82.
Given the approach taken to the inclusion within the orders of the sum of $10,000.00 referred to above, it would be appropriate to restrain the applicants by themselves, their servants and agents from enforcing the said costs judgment against the respondent.
Given the position adopted by the second applicant, it would then be appropriate that all other applications be dismissed.
The Court is satisfied that, in all the circumstances of this case, the orders proposed are just and equitable.
Costs
Section 117 of the Act sets out that each party shall bear his or her own costs subject to the considerations in sub-section two.
Any order for costs must also be determined in light of the substantive judgment and the relative success or failure of the parties. This is naturally something that can only be addressed after judgment is delivered.
The Court proposes to make the orders and directions in relation to any application for costs that might be made as set forth above.
I certify that the preceding one hundred and ninety-nine (199) paragraphs are a true copy of the reasons for judgment of Judge Kemp
Associate:
Date: 27 February 2015
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