Jia & Khajeh

Case [2020] FamCA 1068

FAMILY COURT OF AUSTRALIA

Jia & Khajeh [2020] FamCA 1068

File number(s): PAC 4745 of 2018
Judgment of: FOSTER J
Date of judgment: 16 December 2020
Catchwords: FAMILY LAW – PROPERTY – De facto Property Adjustment – Where discussion of applicable principles – Where short marriage – Where contributions overwhelmingly favour the husband – Where no relevant s 90SF(3) factors – Order for cash payment to the wife.
Legislation: Family Law Act 1975 (Cth) ss 79, 90SF, 90SM
Cases cited:

Bevan & Bevan (2014) FLC 93-572
CCD & AGMD (2006) FLC 93-300
Chapman & Chapman (2014) FLC 93-592
Dickons & Dickons (2012) 50 Fam LR 244
Horrigan & Horrigan [2020] FamCAFC 25
Russell & Russell (1999) FLC 92-877
Scott & Danton [2014] FamCAFC 203
Stanford v Stanford [2012] HCA 52

Teal & Teal [2010] FamCAFC 120

Number of paragraphs: 106
Date of hearing: 4 and 5 November 2020
Place: Parramatta
Counsel for the Applicant: Mr Campton SC
Solicitor for the Applicant: Selvaggio Lawyers
Counsel for the Respondent: Mr Givney
Solicitor for the Respondent: McGrath Dicembre & Company

ORDERS

PAC 4745 of 2018
BETWEEN:

MS JIA

Applicant
AND:

MR KHAJEH

Respondent

ORDER MADE BY:

FOSTER J

DATE OF ORDER:

16 DECEMBER 2020

THE COURT ORDERS THAT:

1.That within one month from this date the husband pay to the wife or as she may, otherwise, direct in writing the sum of $264,514.

2.Leave to apply as to implementation or enforcement on short notice.

Note:   The form of the order is subject to the entry in the Court’s records.

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to 17.02 Family Law Rules 2004 (Cth).

IT IS NOTED that publication of this judgment by this Court under the pseudonym Jia & Khajeh has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

REASONS FOR JUDGMENT

FOSTER J

  1. The application for determination is an application for property settlement orders by the applicant de facto wife (“the wife”) as against the respondent de facto husband (“the husband”).

  2. The parties commenced their de facto relationship in about June 2013 and separated in early November 2017.  Thus a relationship of about four and a half years.

  3. In her Amended Initiating Application filed in January 2020 the wife sought property orders that, in summary, provided:

    (a)that the husband transfer to the wife his interest in the real estate property at C Street, Suburb A (“the Suburb A property”)  and that concurrently with such transfer the husband discharge the mortgage encumbrance secured over the said property;

    (b)that within 14 days of orders the husband vacate the Suburb A property; and

    (c)that within 35 days from the date of orders the husband pay to the wife a further sum of $1,170,000.

  4. Otherwise, the wife sought in the event of the husband’s…

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Details
AGLC
Jia & Khajeh [2020] FamCA 1068
Case
[2020] FamCA 1068
Decision Date

CaseChat Overview and Summary

This matter concerned an application for property adjustment between parties who had been in a de facto relationship. The court was required to determine the appropriate division of property following the parties' separation.

The legal issues before the court were to consider the financial and non-financial contributions of each party to the relationship and the acquisition, conservation, and improvement of their property. The court also had to assess the impact of any proposed orders on the future earning capacity of each party and consider any other relevant matters under section 90SM(4) of the *Family Law Act 1975* (Cth).

Foster J found that the parties had been in a de facto relationship to which the *Family Law Act 1975* applied. The court determined that the husband's contributions to the relationship and the acquisition of assets were overwhelmingly greater than those of the wife. The court found no relevant factors under section 90SF(3) of the Act that would warrant a departure from this assessment.

The court ordered that the husband pay the sum of $264,514 to the wife within one month. Leave was granted to apply as to the implementation or enforcement of this order on short notice.

Orders

Orders of the court

THE COURT ORDERS THAT:

1. That within one month from this date the husband pay to the wife or as she may, otherwise, direct in writing the sum of $264,514.

2. Leave to apply as to implementation or enforcement on short notice.

Note: The form of the order is subject to the entry in the Court’s records.

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to 17.02 Family Law Rules 2004 (Cth).

IT IS NOTED that publication of this judgment by this Court under the pseudonym Jia & Khajeh has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Background

Background to the litigation

Overall, the evidence of the husband where it conflicts with that of the wife that is not supported by objective evidence is to be preferred. Background At final trial the wife was aged 29 and the husband 31. The parties met in late 2012. Subsequently, in March 2013 the wife commenced working at a hospitality business “F Business” owned and operated by the husband. She was employed in customer service. The wife worked at the business four evenings a week and some weekend work. She asserts that she was not paid a wage for her hours worked. In June 2013 the parties commenced cohabitation in a home unit premises at Suburb G in Sydney. That property was owned by the husband’s father. The husband paid no rent to his father but paid property outgoings being council rates, water rates and strata levies. The parties resided in those premises until mid-2014. The parties then moved to the self-contained mezzanine area of premises at H Street, Suburb J, a factory unit from which the business of K Company acquired by the husband operated. In October 2015 the parties then moved to the mezzanine area of factory premises at L Street, Suburb M being the new factory premises acquired by the husband for the K Company business. In June 2017 the parties separated and the wife moved to her parents’ home at Suburb N. The husband continued to live at Suburb M until June 2019 when he moved to a flat at the rear of the Suburb A property. At cohabitation At the commencement of the parties’ cohabitation in 2013 the wife was a Masters candidate at O University. That year her studies were by course work on campus and the following year by way of research but requiring not less than three days on campus each week. She was on scholarship receiving about $16,000 net per annum. She asserts that these funds were used to purchase groceries and to pay for living expenses for herself and the husband. She further asserts that she undertook the primary household duties for the parties including cooking, shopping, cleaning and washing. Otherwise, at the commencement of cohabitation the wife had some savings but also an accumulated HECS debt related to her ongoing tertiary studies. At the commencement of the parties’ cohabitation the husband had the following assets:(a)a one half interest in retail premises at 1 P Street, Suburb Q from which his “F Business” hospitality business operated;(b)a car space being 2 P Street, Suburb Q;(c)a car space being 3 P Street, Suburb Q. This property was sold in December 2017 with sale funds of $85,000 paid to the husband’s company Khajeh International Pty Ltd;(d)the “F Business” operated by him from the Suburb Q property;(e)a motor vehicle; and(f)jewellery. Otherwise, the husband had a credit card liability of about $5,000 at the commencement of cohabitation.Thereafter In late 2013 the husband set up two corporate structures:(a)In August 2013 the husband incorporated Investments Khajeh Pty Ltd (“Investments”) and the Khajeh Discretionary Trust (“the Trust”). Investments is the corporate trustee of the trust and the husband is the sole director of that company and the sole shareholder. (i)Investments in January 2014 purchased a car space at 4 P Street, Suburb Q for $47,000.(ii)Investments as trustee of the Trust in December 2015 purchased a property at E Town for $250,000 that was used by the parties as a weekender on a regular basis. Some renovation work was done to the property by the parties with the help of family and friends. The property was sold at a loss in January 2020 for $238,000 by court order and $77,199 (being the balance with interest owing under interim property order dated 21 January 2019) was paid to the wife and the balance less agent’s commission to the husband.(iii)Investments in June 2017, a few months before the parties separated, as trustee of the Trust purchased a rural property at S Town Road, S Town for $1.1 million. The purchase was wholly funded by borrowings secured over the property and the other properties owned by the husband. The husband acquired some stock for the property and the parties did some cosmetic renovation work before separation.(b)In early December 2013 the husband incorporated Khajeh International Pty Ltd (“International”) for the purpose of acquiring the business “K Company”. International later in December 2014 purchased factory premises at L Street, Suburb M as referred to below.

Evidence

Evidence Before The Court

Regrettably, as a consequence of the community pandemic that manifested itself in the early months of 2020, proceedings were not listed for trial until 4 November 2020 allocating three days for final hearing. The final hearing commenced on 4 November 2020 with the hearing being completed on 5 November 2020 on which date judgment was reserved to a date to be fixed.A word about the parties’ evidence The parties are in conflict as to the history of their relationship, particularly, in the context of this short cohabitation. The conflict focuses, understandably, on the nature and extent of the contributions by the wife during that period. Both parties were cross-examined at some length thus providing to the Court the opportunity of hearing and considering their oral evidence as it contrasted with their evidence in chief as found in their primary trial affidavits. The wife was anxious to focus on what she perceived to be important to the assessment of her contributions. During her oral evidence she made concessions and, otherwise, gave evidence that placed her efforts in perhaps better perspective than she at first represented. It is considered that she placed great emphasis on what she perceived to be her efforts but gave little, if any, evidence as to the contributions made by the husband not only to his accretion of assets but also to his contributions to her in terms of accommodation and financial support. Many of her assertions as to what “we did” were clearly actions of the husband. In many respects her evidence was simply wrong and showed little understanding of the husband’s financial dealings notwithstanding that the proceedings had been ongoing for some time. There were complaints as to the husband’s disclosure and discovery but ultimately the asset pool for consideration was the subject of mostly agreement. The husband, on the other hand, in oral evidence at trial made concessions where appropriate particularly as to the efforts of the wife. His evidence was succinct and clear. He did not seek to diminish the wife’s contributions as conceded by him. Overall, the evidence of the husband where it conflicts with that of the wife that is not supported by objective evidence is to be preferred. Background At final trial the wife was aged 29 and the husband 31. The parties met in late 2012. Subsequently, in March 2013 the wife commenced working at a hospitality business “F Business” owned and operated by the husband. She was employed in customer service. The wife worked at the business four evenings a week and some weekend work. She asserts that she was not paid a wage for her hours worked. In June 2013 the parties commenced cohabitation in a home unit premises at Suburb G in Sydney. That property was owned by the husband’s father. The husband paid no rent to his father but paid property outgoings being council rates, water rates and strata levies. The parties resided in those premises until mid-2014. The parties then moved to the self-contained mezzanine area of premises at H Street, Suburb J, a factory unit from which the business of K Company acquired by the husband operated.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

In 2016 the husband’s father closed his business “U Pty Ltd”. The husband acquired through the company his father’s customer base of clients who had purchased products from the husband’s business. The husband continues to sell to those customers.The wife after separation Subsequent to separation, the parties had some discussions as to resolution. The husband later in the period from April 2018 to January 2020 has paid to the wife sums totalling $211,000 excluding interest and costs. Some of the funds were used by the wife for overseas travel, about $115,000 for legal expenses and some she asserts for living expenses. The wife submitted her initial PhD thesis in April 2019 and then spent five months backpacking in Africa and Europe before seeking to obtain full time employment. She submitted her final thesis in November 2019. Her PhD was conferred in December 2019. The wife obtained full time research position in April 2020 at a salary of $70,000 per annum plus superannuation. She resides with her present partner in his father’s home. She has not disclosed the financial circumstances of that cohabitation.The approach to de facto property adjustment The parties agree that they lived in a de facto relationship to which the Act applies. Part VIIIAB of the Family Law Act 1975 (Cth) (“the Act”) provides for alteration of property interests between parties formerly in a de facto relationship. The legislative process and course of consideration is similar to that under Part VIII of the Act in respect of married persons. Section 90SM of the Act defines the Court’s powers in determining applications for property settlement between de facto couples. Sub-section 90SM(3) of the Act provides that: The court must not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order. Section 90SM(4) of the Act sets out the matters the Court must take into account when considering what orders should be made for the alteration of the interest of the parties in property. Those matters are: (a)The financial contribution made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship: (i)to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or (ii)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: (i)to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or (ii)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 (Cth) 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.