Joiner and Dane

[2017] FCCA 1878

FEDERAL CIRCUIT COURT OF AUSTRALIA

JOINER & DANE [2017] FCCA 1878

Catchwords:
FAMILY LAW – Property orders sought – period of cohabitation of approximately four years – no children – assessment of respective contributions – wife’s initial contribution far greater – assessment of s.75(2) matters – justice and equity – orders made.

Legislation:

Family Law Act 1975 (Cth), ss.75(2), 79(2)

Relationships Act 2008 (Cth)

Applicant: MR JOINER

Respondent: MS DANE

File Number: MLC 5611 of 2014

Judgment of: Judge Hartnett

Hearing date:

6, 7 and 8 June 2016

Reserved for judgment.
Proceedings were then continued with a foreshadowed filing of an Application in a Case by the husband on 12 September 2016. The parties agreed on a further adjournment of the proceedings to a date to be fixed pending quantification of an inheritance to be received by the wife.

Further hearing: 28 April 2017

Delivered at: Melbourne

Delivered on: 10 August 2017

REPRESENTATION

Counsel for the Applicant: Mr Williams

Solicitors for the Applicant: Pearsons Lawyers Pty Ltd

Counsel for the Respondent: Mr Testart

Solicitors for the Respondent: Scammell Black Mileo

THE COURT DECLARES THAT the wife is the sole proprietor of the real property at Property A in the State of Victoria (‘the Property A property’).

THE COURT ORDERS THAT:

1. Within 60 days of the date of these orders (‘the date’), the wife pay to the husband the sum of $231,442.00 (‘the payment’).

2. Order number 4 of the Orders made 17 December 2014 being an order as to costs is discharged.

3. Contemporaneously with the payment the husband provide to the wife a duly executed Withdrawal of Caveat over the Property A property.

4. In the event the whole of the payment has not been made by the date the husband and wife shall forthwith do all acts and things and sign all such documents as may be required to jointly sell the Property A property through an estate agent agreed between the parties and in default of agreement then through an estate agent nominated by the President of the Real Estate Institute of Victoria or his nominee upon terms of sale agreed between the parties and in default of agreement upon such terms as may be recommended by the selling agent and upon completion of the sale the net proceeds be divided as follows:-

   (a)firstly, to pay all costs, commissions and expenses of the sale;

   (b)secondly, to discharge the mortgage to the (omitted bank) and any other encumbrance affecting the Property A property;

   (c)thirdly, so much of the payment as is then outstanding together with interest thereon at the rate of 10 per centum per annum adjusted monthly from the date to the husband; and

   (d)fourthly, the balance to the wife.

5. The wife shall retain for her sole and exclusive use, enjoyment and benefit all items of property (both real and personal and including choses-in-action and financial resources) in her name, possession and/or control including the Property A property.

6. The wife shall be solely liable for and indemnify the husband in relation to all debts and liabilities in her name or attaching to any item of property which she is to retain pursuant to these orders including the Property A property.

7. The husband shall retain for his sole and exclusive use, enjoyment and benefit all other items of property (both real and personal and including choses-in-action and financial resources) in his name, possession and/or control.

8. The husband shall be solely liable for and indemnify the wife in relation to all debts and liabilities in his name or attaching to any item of property which he is to retain pursuant to these orders.

9. Unless otherwise specified in these orders and except for the purposes of enforcing the payment of any money due under these or any subsequent orders:-

   (a)each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession of such party as at this date;

   (b)each party hereby foregoes any claim they may have to any superannuation benefits belonging to or earned by the other;

   (c)all insurance policies to become the sole property of the beneficiary named therein;

   (d)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and

   (e)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.

IT IS NOTED that publication of this judgment under the pseudonym Joiner & Dane is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 5611 of 2014

MR JOINER

Applicant

And

MS DANE

Respondent

REASONS FOR JUDGMENT

1. These reasons are as to property proceedings instigated by the Applicant husband who sought a monetary payment to him from the wife. The wife’s approach to the litigation was that there would be no justice and equity between the parties in any orders that might require such a payment. At the conclusion of the hearing, but before judgment was delivered, the wife’s remaining parent died. The wife is one of two surviving children. She and her brother, in equal shares, inherited the estate of their parents. Whilst that inheritance did not become available to the wife until some three years after the parties had separated, the husband re-opened the proceedings seeking evidence from the wife as to the quantum of her inheritance, and seeking from the Court that it take such inheritance into account in any property adjustment between the parties. The Court is of course obliged to do so. The husband’s further application produced delay in the determination of the proceedings.

2. The Court’s factual findings, on the balance of probabilities, and in respect of the evidence before it are hereafter set out. They support the making of the orders of the Court in accordance with the applicable legislation and the exercise of the Court’s discretion.

3. In an amended initiating application filed on 22 April 2016 for property orders, the Applicant husband sought the following:-

   “1. That within 30 days of the date of the orders (“the date”) the Wife pay to the Husband:

   (a) such sum as represents 40% of the value of the assets available for division between the parties; and

   (b) the costs order in the sum of $2,200 pursuant to paragraph 4 of the orders made 17 December 2014

   (“the payment”).

   2. That contemporaneously with the payment the Husband provide to the wife a duly executed Withdrawal of Caveat over the real property at Property A (“the Property A property”).

   3. That in the event the whole of the payment has not been made by the date the Husband and Wife shall forthwith do all acts and things and sign all such documents as may be required to jointly sell the Property A property through an estate agent nominated by the President of the Real Estate Institute of Victoria or his nominee upon terms of sale agreed between the parties and in default of agreement upon such terms as may be recommended by the selling agent and upon completion of the sale the net proceeds be divided as follows:

   (a) Firstly, to pay all costs, commissions and expenses of the sale;

   (b) Secondly, to discharge the mortgage to the (omitted bank) and any other encumbrance affecting the Property A property;

   (c) Thirdly, so much of the payment as is then outstanding together with interest thereon at the rate of 10 per centum per annum adjusted monthly from the date to the Husband; and

   (d) Fourthly, the balance to the Wife.

   4. That the Wife shall retain for her sole and exclusive use, enjoyment and benefit all items of property (both real and personal choses-in-action and financial resources) in her name possession and/or control including the Property A property.

   5. That the Wife shall be solely liable for and indemnify the Husband in relation to all debts and liabilities in her name or attaching to any item of property which she is to retain pursuant to these Orders including the Property A property.

   6. That the Husband shall retain for his sole and exclusive use, enjoyment and benefit all other items of property (both real and personal and including choses-in-action and financial resources) in his name possession and/or control.

   7. That the Husband shall be solely liable for and indemnify the Wife in relation to all debts and liabilities in his name or attaching to any item of property which he is to retain pursuant to these Orders.

   8. That unless otherwise specified in these orders and except for the purposes of enforcing the payment of any money due under these or any subsequent orders:

   (a) each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession of such party as at this date.

   (b) each party hereby foregoes any claim they may have to any superannuation benefits belonging to or earned by the other.

   (c) all insurance policies to become the sole property of the beneficiary named therein.

   (d) each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders;

   (e) any joint tenancy of the parties in any real or personal estate is hereby expressly severed.”

4. On the final hearing of the matter, the husband reduced the percentage of the asset pool he was claiming from 40 percent to between 25 to 30 percent. This was a slightly more realistic claim. Following the quantification of the wife’s inheritance at $277,462 less the costs of the administration of the estate leaving an agreed net of $270,000, the husband sought a 30% adjustment of the asset pool to him.

5. In the wife’s outline of case document filed on 2 June 2015 she sought the following:-

   “1. The husband do all such things, acts and sign all necessary document to remove at his expense a caveat lodged by him (being caveat numbered (omitted)).

   2. The husband’s application filed on 26 June 2014 be dismissed.

   3. Such further or other orders as this Honourable Court deems appropriate.”

6. On the final hearing of the matter, the wife continued to seek that there be no alteration of the parties property interests and that the parties retain all assets currently in their respective ownership and/or possession. This proposed outcome to the litigation was unrealistic.

History of litigation

1. Delay was a part of this history, for the most part because of the husband’s conduct. The matter was first listed for final hearing on 16 March 2015. On 4 February 2015 orders were made adjourning the final hearing to 3 June 2015. On 3 June 2015 the following orders were made:-

   “1. The matter be adjourned to 4 November 2015 at 10.00am for final hearing (with an estimated hearing time of three days).

   2. The husband within 90 days hereof lodge his taxation returns for the financial years ending 30 June 2007, 2008, 2009, 2010, 2011, 2012, 2013, 2014 and 2015.

   3. The husband within 90 days lodge business activity statements for the period 1 July 2008 to the present time.

   4. The husband within 30 days hereof provide discovery of any and all documents in his possession or power pertaining to exhibits “GJ1” and the proposed replacement to exhibit “GJ2”.

   5. The wife within 30 days hereof provide discovery of any and all documents in her possession or power pertaining to exhibits “GJ1” and the proposed replacement to exhibit “GJ2”.

   6. The husband within 90 days provide business activity statements in respect of Company A.

   7. The husband produce within 90 days all bank statements and all corporate financial documents including profit and loss statements, statutory returns and business activity statements of the company known as Company B from 30 August 2011 to date.

   8. Costs are reserved.

   9. The parties file and serve any further affidavit material they intend to rely upon including the parties filing a statement of financial circumstances which they are required to file, not less than 14 days prior to the final hearing except by agreement.”

2. On 12 October 2015, orders were made by the Court, vacating the final hearing date of 4 November 2015. The following orders were made on 12 October 2015:-

   “1. The trial date of 4 November 2015 is vacated.

   2. The matter be listed for final hearing on 22 February 2016 at 10.00am for final hearing (with an estimated hearing time of three days).

   3. The parties file and serve any further affidavit material they intend to rely upon not less than seven days prior to the final hearing.

   4. The husband comply with all the Orders made on 3 June 2015 within 60 days hereof.

   5. The husband pay the wife’s costs of this Application fixed in the sum of $4,806.80.

   6. In the event the husband fails to comply with Order number 4 herein, the wife is at liberty to seek that the husband’s Application be dismissed pursuant to r.13.03B of the Federal Circuit Court Rules 2001 (Cth) on the final hearing date.”

3. The final hearing listed for 22 February 2016 was administratively re-listed by the Court to 2 May 2016. On 2 May 2016 the following orders were made:-

   “1. All extant applications be adjourned to 6 June 2016 at 10.00am for final hearing with priority (with an estimated hearing time of three days).

   2. The Respondent wife’s costs are reserved of and incidental to the application in a case and the hearing this day.”

Material relied upon

1. The husband relied upon:-

   a)an amended initiating application filed on 22 April 2016;

   b)financial statement filed on 22 April 2016;

   c)affidavits sworn by him on 9 October 2015, 21 April 2016 and 23 May 2016;

   d)affidavits of Mr D (property valuer) sworn on 20 May 2015 and 21 April 2016;

   e)affidavit of Mr O sworn/affirmed on 28 May 2015;

   f)affidavit of Dr M sworn on 9 October 2015;

   g)affidavit Dr G sworn on 21 April 2016;

   h)affidavit of Mr B affirmed on 22 April 2016;

   i)affidavit of Mr A sworn on 29 April 2016; and

   j)affidavit of Mr R sworn/affirmed on 31 May 2016. Mr R is the husband’s father and he gave evidence in the proceedings and was cross examined.

2. The wife relied upon:-

   a)a response filed on 18 August 2014;

   b)financial statement filed on 18 August 2014;

   c)affidavits sworn by her on 18 August 2014, 19 May 2015 and 26 May 2016; and

   d)affidavit of Mr L affirmed on 20 May 2016.

History of parties

1. The husband was born on 1958 and is now aged 59 years. The wife was born on 1968 and is now aged 48 years. When the wife was 16 years of age, and 1985, the wife sustained serious injuries in an accident. She was a passenger travelling to her school in a bus which collided with a truck. Amongst the many and significant injuries sustained by the wife, she suffered a brain injury. She gave evidence, which the Court accepts, that “her memory has never been the same”. The wife received compensation monies as a result of this tragic accident. Some eighteen years prior to meeting the husband in 2009, the wife purchased real property at Property A in the State of Victoria (‘Property A’). She resided in that property and throughout had rented a room out to a tenant.

2. The parties first met on (omitted) 2009. In April 2009, the husband moved into the wife’s property at Property A. He commenced to pay a rental sum to the wife for the first two months of his occupation of the wife’s property. He had moved into the wife’s property as a consequence of his former rental premises ceasing to be available to him. The parties commenced a de facto relationship in June 2009. The husband ceased paying rent to the wife. In February 2010, the parties became engaged and they married on (omitted) 2010. The parties separated on 20 December 2013, at which time the husband vacated the wife’s property. The total period of cohabitation was approximately four and a half years. There were no children of the parties’ marriage. In this relatively short period of cohabitation, there were physical separations and a separation of the parties’ respective finances, matters to which I shall return.

Contribution at commencement

1. At the commencement of the parties’ cohabitation, the husband had the following assets and liabilities:-

   a)$70,083.87 in savings;

   b)shares with an approximate value of $17,000;

   c)chattels with an estimated value of $15,000 but being a valuation to which I can give only little weight; and

   d)superannuation entitlements of $68,935.06.

   Accordingly, the husband had assets with a net value of $87,083.87, some furniture, and superannuation entitlements of $68,935.06. He was aged 51 years.

2. At the commencement of the parties’ cohabitation, the wife had the following assets and liabilities:-

   a)sole proprietorship of Property A. The property had a value at that time of $1,100,000 on the wife’s evidence, and $1,040,000 on the husband’s evidence;

   b)real property situate at Property B in the State of Victoria (‘Property B’). The wife was the sole proprietor of this property. It had a value of $675,000;

   c)a motor car valued at $5,000;

   d)chattels with an estimated value of $10,000, though again the Court gives this figure little weight;

   e)superannuation entitlements of $44,481;

   f)mortgage loans of approximately $474,000; and

   g)a (omitted bank) loan of $31,169.

   Accordingly at June 2009 on the wife’s evidence she had net assets of $1,274,831 disregarding the estimated value of her chattels; some furniture and superannuation entitlements of $44,481. She had also a contingent liability, which is discussed hereafter, to a Mr W, a builder renovating her two real properties, in a sum unquantified. Ignoring this liability for the moment, the wife’s net asset position was superior to that of the husband by $1,187,747.13. If the husband’s valuation of the wife’s property was more accurate then that sum would be $1,127,747.13. She was aged 40 years.

3. The value of Property A at the commencement of cohabitation was not agreed by the parties. The husband’s valuation of $1,040,000 was supported by a valuation annexed to an affidavit sworn by Mr D on 20 May 2015. The wife’s valuation of $1,100,000 was supported by a valuation of Mr L which is annexed to an affidavit sworn by him on 20 May 2016. Both Mr D and Mr L are qualified and experienced valuers. Both were providing retrospective valuations. Neither was called as a witness and therefore not cross-examined. It was not possible for the Court to make a finding in these circumstances as to which value should be preferred though on the untested evidence Mr L’s valuation is preferred. The Court considered both valuation figures in the exercise of its discretion.

4. The value of Property B in June 2009 was also for some time in dispute between the parties. This property was sold on 19 August 2011 for $790,000. The net proceeds of sale were $519,613.23. The husband claimed the value of this property to be $565,000 in April 2009 based on the average of two appraisals, one being from Real Estate B dated 23 July 2008, and the other from Real Estate B dated 10 June 2009.  The wife relied on a sworn valuation which was attached to an affidavit filed in this proceeding on behalf of the husband and sworn by Mr D on 28 April 2016. That value was $675,000. The sworn valuation by a qualified valuer is accepted by the Court as the more accurate value of the property. It ultimately was accepted by both parties.

Asset pool

1. The asset pool of the parties at trial was as follows:-

Asset	Registered ownership	Value
Property A	Wife	$1,410,000 as agreed
Motor vehicle	Wife	A figure in the $20,000’s
Chattels	Wife	$10,000 approximately
Motor vehicle	Husband	A figure approaching $20,000
Shares	Husband	$22,264
Savings	Husband and Wife	Variable but nominal and approximately equal

Liability	Registered ownership	Value
Mortgage over Property A	Wife	$245,000
(omitted bank) loan	Wife	$27,400
(omitted bank) overdraft	Wife	$8,500
Credit Card Debt	Wife	$5,000 approximately
Credit Card Debt	Husband	$6,403 approximately
Debt to husband’s father as claimed by husband	Husband	$10,000
Tax liabilities (relevant to the period of cohabitation)	Husband	$11,244

NOTE: No valuations as to motor vehicles and chattels were before the Court. The valuations provided were estimates only and treated by the Court as such. Likewise the parties’ savings and credit card debt were in a state of flux and no adjustment in respect of any of these items of property was sought.

1. At trial, the husband and wife had superannuation entitlements of $155,878 and $85,766 respectively. Thus the husband’s superannuation entitlement exceeds that of the wife by $70,112. At the commencement of cohabitation the husband’s superannuation entitlements exceeded that of the wife by $24,454.06. Counsel for the husband argued the increase in the husband’s superannuation reflected his post separation relatively high income, which was his sole contribution.

2. The husband has taxation liabilities which have arisen post separation and cover periods that are post separation. He has a taxation debt of $28,702.75 for the 2015 financial year and a taxation debt of $23, Property A 248.85 for the 2014 financial year although he is seeking to reduce this sum by discussion with the Australian Taxation Office. He failed to complete and lodge taxation returns for many years. Indeed he had not filed a return for the 2007 financial year and onward and caused delay in these proceedings by failing to do this in a timely manner. He has now done so, lodging taxation returns in April 2016. A taxation liability of only $11,244 can be attributed to the cohabitation period. It is a sum which should, and could, have been paid by the husband in that time.

3. The wife’s equity in Property A is now $1,129,100. The property is rented. The wife currently receives approximately $1,100 a month in rental receipts less expenses. The wife of course needs to live elsewhere to continue this income stream. She was living in her parent’s home for a time but her brother’s interest in same now needs to be paid out to him.

Contributions during cohabitation

The Brunswick Properties

1. At the time the husband moved into Property A, the wife had been undergoing building works to both Property A and Property B the (omitted) Properties’).The wife had commenced renovations and extensions firstly to Property A in September 2006. She had engaged a Mr W to undertake the works and had already paid Mr W a sum of $150,000 out of a maximum anticipated price of $150,000. At the behest of Mr W, the wife was an owner-builder. In November 2007, Mr W claimed a further sum owing of $100,000. At the time, the wife’s income from her employment was approximately $49,000. She had a cash flow problem as a consequence of the increase in the cost of the renovations and sought to alleviate this by selling Property. Mr W was then engaged to do some works to Property B to enable it to be put on the market for sale. In February 2008 he commenced those works, rendering the property unable to be sold or tenanted. He required further ongoing funds the wife did not have. Works come to a standstill ultimately as a dispute arose between Mr W and the wife as to what monies were owed to him and as to the quality of his work.

2. In April 2009 the wife met the husband. The husband was employed in the construction industry as a project manager. Following the commencement of cohabitation, he became involved in the building dispute between the wife and Mr W. As at April 2009 Mr W had claimed a further sum owing to him of $130,000. The wife was not happy with the workmanship of Mr W whom, not known to her, was not a licensed builder nor a qualified carpenter. Additionally he was claiming amounts for work done that the wife considered excessive sums. Monies were required immediately to complete Property B to make it liveable. The husband advised the wife there were numerous building defects in the work already done. He took over the wife’s dealings with Mr W and controlled the further direction of the renovations of Property B. The husband’s income at that time was $90,666. In the financial year following, the husband’s income was $94,699. The husband was able to, and did, advance money to the wife, by way of interest free loan, in the total sum of $60,000 or $70,000 as variously claimed by him. This injection of funds enabled completion of the works on Property B to place that property in a condition to be sold. Some very limited part of these monies was applied to Property A.

3. Additionally, the husband contributed to the building works between late 2009 and May 2011 when Property B was completed both in a site-management capacity, which he estimated exceed 400 hours in 2010 alone, as well as the performance of some physical labour. The husband relied on a report by Mr B of (omitted consultants) which estimated that the improvements made by the husband (if accepted by the Court) would cost approximately $116,983; his role of site-supervision and site management would cost $43,998 and his role of project manager would cost $21,060, if completed by a builder. The difficulty with this evidence is that:-

   a)the husband had no contract with the wife for services he performed, or any work done, let alone was there any discussion at any time about an hourly rate being applicable to any contribution made by the husband;

   b)the wife disputes the time claimed to be spent by the husband in respect of his contribution to Property B. Following the marriage, the husband spent considerable periods of time in Sydney, staying with a friend, and pursuing his interests in a business in Sydney called Company B. Indeed the husband had requested the wife give him an amount of $140,000 for him to invest in the business. The wife refused. Between February 2010 and January 2011, little work was carried out on Property B. Between January 2011 and for the next 12 months approximately on the wife’s evidence, which the Court accepts, the husband was residing in Sydney for approximately half that time. Whilst there, and in May 2011, the husband became very ill and underwent cardiac surgery being a quadruple bypass. By that time, most of the work on Property B had been completed;

   c)even accepting that considerable effort was made by the husband and work undertaken, although the Court does not accept the extent of the hours claimed by the husband, how did this contribution impact on the parties’ assets? Certainly it enabled a sale of Property B and cessation of the working relationship with Mr W. The wife could not have achieved that on her own. What followed however was costly.

4. At the husband’s instigation, the wife commenced proceedings in the Victorian Civil and Administrative Tribunal (VCAT) in the (omitted) against Mr W, who had claimed $180,000 from the wife for unpaid works carried out by him. These proceedings were commenced in 2011. In (omitted) 2012 Mr W brought proceedings against the wife in the County Court pursuant to the Relationships Act 2008 (Vic) in which Mr W claimed that he and the wife had been in a de facto relationship. He sought a payment of $600,000 from the wife to him. The wife saw that as being entirely unmeritorious and an act of aggression. She and Mr W had a brief, being of some months duration, sexual relationship some time prior to the wife meeting the husband. Mr W had harassed and “petrified” the wife thereafter. The wife and Mr W settled both claims on (omitted) 2013, with the wife paying Mr W the sum of $180,000 as claimed in the building dispute. The payment to Mr W was made out of the proceeds of sale of Property B. The sum of $180,000 had been paid into Mr W’s solicitor’s trust account on 23 September 2011. The payment represented a settlement of the building dispute. Mr W discontinued his de facto relationship claim and each party paid their own costs in respect of the two sets of proceedings. The defective works, as claimed by the husband and wife with respect to Property A were in a sum of $35,532.96 and remain to this day unattended to.

5. The husband was heavily involved in the building dispute between the wife and Mr W. He prepared lists of defects; applied for certification of works; prepared a chronology of events; and prepared costings for the defective and incomplete works. The husband’s evidence is that he was primarily responsible for providing the wife’s lawyers with the information required for them to run her case. The husband’s evidence is that he spent considerable time investigating facts, preparing documents and reports and instructing lawyers as well as valuers and building consultants. The husband puts a value on his time spent with respect to the wife’s litigation with Mr W in the sum of $54,854.50, being approximately 353 hours at a rate of $155 per hour. Of course this is fairly fictional. The wife and husband never entered into any form of contract with each other as to any works done or time invested by the husband. He made a contribution which the wife considered at times useful, and at others unhelpful and a hindrance. The wife claimed her exposure to legal fees was vastly increased by the husband’s activities. Further, the husband’s claim for ‘project management fees’ in the Amended Points of Claim in the VCAT proceedings as at 8 March 2012 was $65,800, being an amount which exceeded the total claimed costs for the defective and incomplete works. Most significantly, when considering this contribution, its context is that as a result of the VCAT proceedings, the wife incurred legal fees totalling a sum of $180,000. The husband did not. He contributed just $1,400 toward these fees. The wife otherwise paid them out of the proceeds of Property B.

6. Otherwise as to contributions more generally, the wife made all payments with respect to the rates, utilities and mortgage repayments for the (Property A and Property B) Properties throughout cohabitation. She paid her motor vehicle expenses. Grocery expenses were shared between the parties, in greater share by the husband. Household duties were performed by each. The parties throughout maintained separate bank accounts save for a ‘holiday’ account, into which only the wife placed funds, and then only for a limited period. The husband paid for many living expenses, including the purchase of white goods and payment of the home and contents insurance and Foxtel for Property A. He also transferred $15,539 to the wife’s accounts over the four and a half years. The parties’ finances remained otherwise separate. The husband’s income, whilst relative to the wife was high in the first two years of cohabitation, then decreased, being $54,291 in the 2011 financial year; $43,379 in the 2012 financial year and $11,106 in the 2013 financial year. The wife’s income consistently increased to reach a figure of $92,000 gross per annum. Following separation, the husband’s income increased significantly and he again had greater income and earning capacity than the wife. He has always had a greater earning capacity than the wife, save for the period when he was ill in 2011. Additionally, the husband paid for the parties wedding and honeymoon in a sum he claimed was $50,000 to $60,000. The wife says this amount is inflated. The guests at the wedding gave the parties ‘wishing well’ monies which were applied by the husband solely for the purchase of a new motor vehicle registered in his sole name. That vehicle is now, some seven years later, worth approximately $20,000.

Hotel

1. In 2012, the husband entered into a business venture with a friend, Mr F. Together they purchased through the company ‘Company C’ (‘the company’) the leasehold and business of the (Compnay C business) in (omitted). The husband and Mr F were the two directors and shareholders of the company. The wife had no interest in the company.  She did not wish to do so thereby putting at risk any of her assets.

2. Due to the misappropriation of funds by Mr F, the company went into voluntary liquidation in September 2013. The total amount lost was approximately $121,250. This included the cost of the liquidator of $7,700. The possible financial demise of the company became evident in January 2013.

3. On 4 October 2012, the wife had transferred $70,000 of funds held in her name and being her funds from the sale of Property B into a (omitted bank) savings account of the husband. The husband claimed that this money was intended by both he and the wife to be a joint investment in the purchase of the (Company C business) leasehold and business. Upon receipt of the payment from the wife and on the same day, the husband transferred $75,000 from his account to the Company C. Monies were then transferred to the (omitted Trust Account) (being the bank account of the vendor of the business) in the sums of $66,870.59 and $5,321.45 (a total of $72,192.04) representing settlement of the sale. The wife denied that her intention was to invest in the company. Her evidence was that the $70,000 she paid to the husband at that time was to repay him for his direct financial contributions to the (Property A and Property B) Properties. The wife’s further evidence was that she believed that his contributions equalled $40,000 and that she only transferred the sum of $70,000 after assurances from the husband that his expenditure on the Property A and Property B properties did in fact equal $70,000. That sum has been deposed to as up to $60,000 in the husband’s earlier affidavits.

4. The Court prefers the evidence of the husband and accepts that the wife was involved in the company business and supported her husband in his endeavours with respect to that business. Whilst the Court finds the amount of $70,000 was agreed upon by the parties by reference to the husband’s financial input by way of loan to the wife for the Property A and Property B properties, the wife cannot claim that her advance of the funds was simply a repayment of the husband’s earlier loan to her. She was keen to see the husband employed and interested in a project. Between October and December 2012 the wife was often in (omitted) assisting her husband. As she said “I was supporting him”. Neither expected that Mr F would abscond with funds. The wife of course knew little about Mr F. He was the husband’s friend. But the husband and wife spoke often about the business proposal and subsequent operations. The husband told the wife that Mr F was putting no money into the business, a matter which concerned the husband. The business was a joint venture of the parties, even if the husband was far more involved than the wife, and it went horribly wrong. It was another dismal financial outcome for the parties during cohabitation. It represented also another 12 month period where the husband and wife lived for most of the week fairly separate lives. An end to the marriage followed.

5. The husband also received $10,000 from his father by way of an interest free loan in 2012, with such monies being applied to the company business. His father had advanced earlier sums in 2011, totalling $50,000. These monies were applied by the husband to the household and building expenses.

s.75(2) matters

1. The husband has experienced significant health issues including undergoing a quadruple coronary artery bypass grafting in May 2011. The husband was also diagnosed with anxiety and depression in 2012 and 2015. Dr G’s assessment is that the husband is now stable, though still stressed and subject to him taking his medication, engaging in regular exercise, being careful with his diet and reducing his stress levels, his prognosis is good.

2. At trial, the husband was employed by (employer omitted) as a (occupation omitted). His employment agreement with (employer omitted) was due to expire in March 2017. He had prospects of ongoing employment in the role. The husband’s income at trial was $150,000 per annum gross inclusive of superannuation. Additionally, the husband received a living away from home allowance of $550 per week, a total of $28,600 per annum. The wife had been in continuous full time employment as an (occupation omitted) with (employer omitted) since 2001. She earnt approximately $94,000 gross per annum and also received $13,200 per annum in rent from Property A less the costs of some expenses relating to the rental property. By April 2017 she had moved to live in her parent’s home in New South Wales. She had taken long service leave. She had lost both her parents in recent times and had a fledging relationship with a farmer. Her life had some uncertainty ahead, as did the husband’s.

3. The husband’s father is alive and has provided him with funds in the past. The husband may inherit from his father’s estate but that has not occurred and so cannot be taken into account. The wife has received an inheritance in the sum of $270,000. It is a resource available to the wife, to which the husband has made no contribution.

4. In the pursuit of this litigation the parties have expended legal costs. The wife paid $20,000 in May 2016 with further sums to pay and the husband has paid in excess of $133,000 with further sums owing.

Conclusion

1. Having considered the above matters, the Court is required, pursuant to s.79(2) of the Family Law Act 1975 (Cth) to be satisfied that, in all the circumstances, it is just and equitable to make any order. The orders which the Court shall make achieve that statutorily required outcome.

2. It is agreed by the parties and determined by the Court, that the wife made an overwhelming initial financial contribution to the parties asset pool, being her ownership and equity in the Property A and Property B Properties.

3. During cohabitation the wife’s direct financial contribution exceeded that of the husband, in particular her payment of the legal costs. The parties otherwise made various other contributions as set out above.

4. Whilst the husband argued the s.75(2) matters favoured him, it is difficult to sustain that argument. His income and earning capacity exceed that of the wife. He has some physical limitation and is older than the wife. The wife has the residue injuries of her accident which were obvious in the witness box. She required the husband’s contribution in her building dispute with Mr W as it would not have been possible for her, with her memory limitations, to manage that sort of complexity as indeed appropriately submitted by Counsel for the husband. The husband has greater superannuation available to him and will retain his Telstra shareholding whilst the wife has her inheritance.

5. The husband should bear the sole responsibility of the monies owing to his father. The Court does not find that any request for repayment of the loan advanced by the husband’s father has been made nor is likely to be made. The husband included that amount in the approximately $51,000 he claimed to have lost of his own monies on the hotel business. Given his income at that time it is difficult to see how his loss was as large as claimed but the wife, being pragmatic, accepted it. The wife’s loss was $70,000.

6. The wife’s equity in Property A is $1,129,100. Twenty per cent of this sum as an adjustment to the husband for his contributions is $225,820. The wife additionally should pay to the husband a sum of $5622 being one half of the taxation amount owing on the husband’s income earnt in the relevant period. The earlier costs order against the wife will be discharged. Costs are a discretionary matter for the Court. The Court is of the view that the husband, in the course of the litigation, added to the wife’s costs in a sum much greater, even taking into account the earlier costs order in the wife’s favour. Adjournments were occasioned by the husband’s conduct rather than the wife’s. It was only when the husband obtained the services of his current solicitors that the matter progressed.

I certify that the preceding forty-two (42) paragraphs are a true copy of the reasons for judgment of Judge Hartnett

Date: 10 August 2017