JOSLIN and BRIDGES
[2015] FCWA 114
•15 OCTOBER 2015
JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA
ACT: FAMILY COURT ACT 1997
LOCATION: BUNBURY
CITATION: JOSLIN and BRIDGES [2015] FCWA 114
CORAM: WALTERS J
HEARD: 14 & 15 OCTOBER 2015
DELIVERED : 15 OCTOBER 2015
FILE NO/S: PTW 2401 of 2014
BETWEEN: MS JOSLIN
Applicant
AND
MR BRIDGES
Respondent
Catchwords:
FAMILY LAW – PROPERTY – DE FACTO RELATIONSHIP – Where parties were married for a short time but then separated and divorced – Where parties both formed subsequent relationships with other people – Where parties later enter into a de facto relationship – Alteration of property interests under Family Court Act (1977) (WA) – Consideration of parties' respective contributions – Consideration of s 205ZD(3) factors – Where de facto husband's financial contributions outweighed those of de facto wife – Where accuracy of de facto husband’s financial information could not be confirmed – Where de facto husband refused to mediate or negotiate in any reasonable sense and was determined to press the proceedings to trial
Legislation:
Family Court Act 1997 (WA)
Category: Not Reportable
Representation:
Counsel:
Applicant: Mr R Kroon
Respondent: Self Represented Litigant
Solicitors:
Applicant: Kroon Legal
Respondent: Self-Represented Litigant
Case(s) referred to in judgment(s):
Bevan & Bevan [2013] FamCAFC 116
Bevan & Bevan [2014] FamCAFC 19
Bolger & Headon [2014] FamCAFC 27
Bonnici & Bonnici (1992) FLC 92-272
Chapman & Chapman [2014] FamCAFC 91
Clauson & Clauson (1995) FLC 92-595
Dekker & Dekker [2014] FCWA 61
Dickons & Dickons [2012] FamCAFC 154
Farmer & Bramley [2000] FamCA 1615
Fielding & Nichol [2014] FCWA 77
Figgins & Figgins [2002] FamCA 688
Fullgrabe & Fullgrabe [2015] FCWA 9
G & G [2004] FamCA 1179
GS & TS [2005] FamCA 40
Harrington & Harrington and Ors (2007) FLC 93-317
Hayton & Bendle [2010] FamCA 592
NHC & RCH (2004) FLC 93-204
Re F – Litigants in Person Guidelines (2001) FLC 93-072
Saxena & Saxena (2006) FLC 93-268
Stanford v Stanford (2012) 247 CLR 108
Steinbrenner & Steinbrenner [2008] FamCAFC 193
Waters & Jurek (1995) FLC 92-635
Ex tempore Reasons for Judgment
WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL JUDGMENT - PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN CHANGED
Introduction
1I propose to deliver ex tempore reasons. In my view, although the trial ran for only two days, it was two days too long for a case that should have been mediated and resolved by negotiation between the parties. I accept the submission of Mr Kroon (who appeared for the wife), however, that [Mr Bridges] absolutely refused to mediate or negotiate in any reasonable sense and that he was not prepared to cooperate effectively in the process of alternative dispute resolution. I find that he was determined to take this matter to trial – for reasons which are completely incomprehensible to me. This was a simple case and, with some good will on each side, it could have been resolved at a very early stage, and at very modest cost to each party.
2Applications concerning the property of former de facto partners in Western Australia are dealt with in Pt 5A of the Family Court Act 1997 (WA) – which I shall call the FCA. Parts VIII and VIIIAB of the Family Law Act 1975 (Cth) – which I shall call the FLA – contain the comparable Commonwealth legislation dealing with financial matters relating to parties who have been married and parties to de facto relationships respectively.
3The jurisdiction of this Court to make orders altering the property interests of de facto partners is only enlivened if certain conditions are met – including, for example, that the de facto relationship ended after 1 December 2002 and was connected with the State of Western Australia in specified ways. Similarly, the Court may only make property orders if it is satisfied that the de facto relationship subsisted for at least two years, there is a child of the relationship under the age of 18 (and failure to make the property orders would result in serious injustice to the child's primary caregiver) or the applicant for the property orders has made substantial contributions and failure to make relevant orders would result in serious injustice to him or her: see FCA s 205Z.
4It is accepted that all necessary preconditions have been met and that FCA Pt 5A applies in the circumstances of the present case. The only dispute between the parties relates to the manner in which their property interests are to be dealt with.
5In these reasons, I will refer, at least initially, to the parties' papers for the judge. I will then make reference to the schedule of assets and liabilities that I have prepared on the basis of the parties' evidence. I will also make some comments about the contributions of the parties and the FCA s 205ZD(3) factors.
6Throughout these reasons, I shall refer to the parties as the husband and the wife, even though they were de facto partners – because it is simpler, less grammatically challenging and more convenient to refer to them in this manner. Indeed, the parties were husband and wife for a period of approximately two years in the mid-1980s.
7The wife was represented at trial by Mr R Kroon. The husband was unrepresented.
The husband was unrepresented
8Given that the husband was unrepresented, I was very conscious of the obligation upon the Court to provide a fair trial – for both parties. I am aware of the guidelines regarding the manner in which a judicial officer should deal with unrepresented litigants, and the associated discussion contained in Re: F – Litigants in Person Guidelines (2001) FLC 93-072 at [209] to [253]. I applied those guidelines during the course of the proceedings, and am comfortable that the trial was fair. In summary:
(a)procedural fairness was afforded to both parties;
(b)the 'mechanics' of the trial, and the right of the husband to cross-examine witnesses, were explained to the husband;
(c)other relevant procedures were explained to the husband as they arose;
(d)I explained to the husband that he had the right to object to inadmissible evidence, and explained to him – in very broad terms – the types of evidence that might be considered inadmissible;
(e)where appropriate, I attempted to clarify the substance of the husband's submissions; and
(f)where appropriate, I took other steps as authorised by the Full Court in Re: F – Litigants in Person Guidelines at [253]: see Guideline #9 in that paragraph.
9In Saxena & Saxena (2006) FLC 93-268, Coleman J emphasised that the type of guidelines set out in the previous paragraph are "no more than the name implies" and that they "derive from the broader considerations of natural justice, implicit in which is the recognition that for a litigant in person to be afforded natural justice and procedural fairness, that litigant must have some appreciation of just what is going on". His Honour added that the Court must be concerned with "the spirit rather than the strict letter of the guidelines".
10In the present case, the husband participated in the process fully. I have no doubt that he fully understood 'what was going on' at all times.
The parties have been married previously
11The wife was born in 1966 and the husband was born in 1963.
12As I have indicated, this case involves a slightly unusual factual scenario in that the parties commenced cohabitation, initially, in 1986 and were married in April 1986 – but they separated very shortly afterwards.
13According to the wife, the parties separated in November 1986 following a period of cohabitation of approximately seven months. They divorced in 1988. The wife re-married in 2000 and separated from her second husband in 2009. In that same year – in approximately May 2009 – the parties recommenced cohabitation. Immediately prior to, or shortly after, the resumption of the parties' relationship, the wife received a property settlement from her second husband. I shall refer to that subject a little later.
14Because they divorced many years before they resumed cohabitation, and because it is not in dispute that the second period of cohabitation amounted to a de facto relationship, the proceedings fall to be dealt with under the provisions of the FCA. There was no dispute in relation to the legal characterisation of the parties' relationship. There may be some dispute about precisely when the parties commenced cohabitation, or when they separated, but little turns on those matters.
Property settlement – the law as it relates to de facto relationships in Western Australia
15FCA s 205ZG is headed Alteration of property interests. It is similar, although not identical, to FLA s 79.
16The relevant provisions of s 205ZG are as follows:
1)In proceedings with respect to the property of de facto partners, or either of them, the court may make such order as it considers appropriate altering the interests of the parties in the property, including an order for a settlement of property in substitution for any interest in the property and including an order requiring either or both of the partners to make, for the benefit of either or both of the partners or a child of the de facto relationship, such settlement or transfer of property as the court determines.
2)…
3)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.
4)In considering what order (if any) should be made under this section in proceedings with respect to any property of de facto partners, or either of them, the court must take into account —
(a)the financial contribution made directly or indirectly by or on behalf of a de facto partner 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 de facto partners, 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 de facto partners or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a de facto partner or a child of the de facto relationship to the acquisition, conservation or improvement of any of the property of the de facto partners 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 de facto partners or either of them; and
(c)the contribution made by a de facto partner to the welfare of the family constituted by the de facto partners and any children of the de facto partners, 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 de facto partner; and
(e)the matters referred to in s 205ZD(3) so far as they are relevant; and
(f)any other order made under this Act affecting a de facto partner or a child of the de facto relationship; and
(g)any child support under the Child Support (Assessment) Act that a de facto partner has provided, is to provide, or might be liable to provide in the future, for a child of the de facto relationship.
17FCA s 205ZD is headed Maintenance orders. It is similar, although not identical, to FLA s 75.
18Section 205ZD(3) – which is referred to in s 205ZG(4)(e) – is as follows:
3)The matters to be taken into account are —
(a)the age and state of health of each of the de facto partners; and
(b)the income, property and financial resources of each of the de facto partners and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either de facto partner has the care or control of a child of the de facto relationship who has not attained the age of 18 years; and
(d)commitments of each of the de facto partners that are necessary to enable the partner to support —
(i)himself or herself; and
(ii)a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (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; and
(g)a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(i)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(j)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; and
(k)the need to protect a party who wishes to continue that party's role as a parent; and
(l)if either party is cohabiting with another person, the financial circumstances relating to the cohabitation; and
(m)the terms of any order made or proposed to be made under section 205ZG in relation to the property of the parties; and
(n)any child support under the Child Support (Assessment) Act that a de facto partner has provided, is to provide, or might be liable to provide in the future, for a child of the de facto relationship; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement or former financial agreement that is binding on the parties.
19Section 205ZD(4) – which is referred to in s 205ZD(3) – is as follows:
4)In exercising its jurisdiction under this section, a court must disregard any entitlement of the de facto partner whose maintenance is under consideration to an income tested pension, allowance or benefit.
20I discussed the law relating to property settlement (albeit as it relates to analogous FLA provisions) in my decisions in Dekker & Dekker [2014] FCWA 61 and Fullgrabe & Fullgrabe [2015] FCWA 9 – although I acknowledge Thackray CJ's references to the former decision in Fielding & Nichol [2014] FCWA 77.
21Relevantly, I referred to the effect of the High Court's decision in Stanford v Stanford (2012) 247 CLR 108 ("Stanford") and the Full Court's decisions in Bevan & Bevan [2013] FamCAFC 116, Bevan & Bevan [2014] FamCAFC 19 and Chapman & Chapman [2014] FamCAFC 91 and acknowledged that the Full Court ruled that:
a)it would be a "fundamental misunderstanding" to read Stanford as suggesting that the matters referred to in FLA s 79(4) (FCA s 205ZG(4)) must be ignored in determining whether it is just and equitable to make an order altering property interests;
b)on the other hand, a consideration of the FLA s 79(4) (FCA s 205ZG(4)) matters is not mandatory in answering the FLA s 79(2) (FCA s 205ZG(3)) question;
c)the just and equitable requirement is not "a threshold issue, but rather one permeating the entire process"; and
d)while the FLA s 79(4) (FCA s 205ZG(4)) and FLA s 79(2) (FCA s 205ZG(3)) issues must not be conflated, "they are intertwined because the text of the [FLA] links them" (and the same can be said, of course, the text of the FCA).
22For the reasons given in the decisions to which I have referred, and assuming a "step" or "stage" based approach to the determination of an application brought pursuant to the provisions of s 205ZG (which, for the sake of convenience, I shall call "the property settlement exercise") is still appropriate, it is arguable that an acceptable approach to the determination of such an application is as follows:
(a)The first step in the property settlement exercise is to identify, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in their property.
(b)The second step involves ascertaining whether it is just and equitable – within the meaning and contemplation of s 205ZG(3) – to make an order altering the interests of the parties in their property. In most cases (relevantly, where the parties have separated and are no longer living in a marital or de facto marital relationship) the underlying assumptions that the parties had to the effect that the existing property ownership arrangements were functional (or perhaps irrelevant) and could be varied by agreement between them, no longer apply. That fact alone should ordinarily persuade the Court that it is just and equitable to make orders altering the parties' interests in their property. It is only after the Court has concluded that it is just and equitable to make such orders that it should proceed to take what might be regarded as the third and fourth steps.
(c)In the course of ascertaining whether it is just and equitable to make an order altering the interests of the parties in their property (in other words, during the second step described above) it is legitimate to consider the contributions of the parties in all their various guises, but consideration of those matters at this stage of the property settlement exercise is not obligatory; still less is that consideration conclusive in determining whether "the 'just and equitable' test" has been met.
(d)In the third step, the Court should identify and assess the contributions of the parties within the meaning of ss 205ZG(4)(a), (b) and (c), and determine their contribution-based entitlements.
(e)In the fourth step, the Court should identify and assess the relevant matters referred to in ss 205ZG(4)(d), (e), (f) and (g) – including, because of s 205ZG(4)(e), the matters referred to in s 205ZD(3) so far as they are relevant – and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established as a consequence of the previous step.
(f)Finally, the Court should consider the effect of the various findings and assessments it has made and make such orders as it considers are just and equitable in all the circumstances. As I have discussed in the cases to which I have referred, my view is that this process does not amount to an opportunity to make a further substantive "adjustment"; it is an opportunity for the Court to determine finally how, in reality, just and equitable orders might be achieved having regard to all the circumstances of the case.
(g)Throughout the process described above, the Court must bear in mind that the prohibition against making an order under s 205ZG unless the Court is satisfied that, in all the circumstances, it is just and equitable to make the order – see s 205ZG(3) – is neither "a threshold issue" nor some sort of "factor" to be considered wholly within one or more of the steps or stages referred to. Instead, it pervades and informs the entire process.
Introductory comments
23The parties cohabited in a de facto relationship for approximately three years. In the chronology contained in the wife's papers for the judge, some references are made to the wife removing her possessions from [New South Wales] to Western Australia in about July 2009, to the wife doing some work and acquiring a motor vehicle and the like, and to the parties separating finally in approximately May 2012. As I have indicated, little turns on the precise date of commencement of cohabitation or the precise date upon which the parties finally separated. Suffice it to say that I accept the de facto relationship lasted for approximately three years.
24For his part, the husband had also been in a relationship which began and ended after the parties divorced. Despite this, at the commencement of the parties' de facto relationship he had assets of reasonably significant value, although he also had liabilities at that time. I shall return to this subject a little later.
25Since the date of separation, both parties have continued working in paid employment. In November 2012 the wife commenced living with her current partner, [Mr D] – who did not give evidence during the course of the proceedings. The wife's case is that the s 205ZD(3) factors do not favour one party or the other and that the Court should therefore focus, primarily, on the parties' respective contributions.
26The husband's case was extremely difficult to follow, but if I comprehend his case accurately, he suggests that his financial position has deteriorated in the last 12 months, that his earning capacity has been adversely affected and that, consequently, the proper application of the s 205ZD(3) factors should lead to an adjustment in his favour. During closing addresses, Mr Kroon indicated that the likely payment from the husband to the wife by way of alteration of property interests should be something between approximately $30,000 and $60,000 or, perhaps, a little more.
27The wife had originally sought a payment of $90,000 from the husband, but abandoned that claim during closing addresses because the evidence did not warrant such a substantial payment. With great difficulty, the Court was eventually able to extract from the husband a concession that, in his view, he should pay the wife – as and by way of property settlement – something in the order of $15,000 to $20,000.
28When all is said and done, therefore, it is blindingly obvious that this is a comparatively minor dispute that has been blown out of all proportion by the parties and, in particular, by the husband – who has declined to look reasonably at any proposals that may have been made on behalf of the wife. Further, I am satisfied that he has never attempted to endeavour to negotiate a sensible compromise of the parties' competing claims. He has, to put it colloquially, been prepared to cut off his nose to spite his face. Extraordinarily, in his papers for the judge the husband says (at para 16 – after referring to an event at a conciliation conference) that:
I have clearly shown in documentation I do not have $90,000 in assets which the other side is seeking and I am now seeking financial compensation of $169,400 for my time, being approximately 2200 hours, preparing Family Court documentation instead of trying to find more work to pay my current debts and taxation liabilities. Currently, the applicant and their lawyer wants 141.08% of my total asset pool.
29That passage says a very great deal about the unreasonableness of the husband in this case. 2200 hours equates to 55 weeks at 40 hours per week. In other words, the husband has wasted over a full year fighting the wife's claim. His suggestion that he should be compensated for wasting his own and everybody else's time is preposterous.
Property and liabilities at the date of trial
30The first step in the property settlement exercise relates to the identification and valuation of the property of the parties at trial. It includes the identification, according to ordinary common law and equitable principles, of the existing legal and equitable interests of the parties in their property.
31Let me then turn, at this point, to the assets and liabilities of the parties. I explained the property settlement exercise to Mr Bridges at the commencement of the trial as I was obliged to do. Regrettably, it was like water off a duck's back. To a large extent, the husband paid no attention to the actual process the Court would have to embark upon in determining the issues before it.
32To the husband's credit, however, he did cooperate with Mr Kroon (when pressed) for the purpose of preparing an agreed schedule of assets and liabilities – although a number of liabilities remained in dispute. The schedule was handed up on the first day of the hearing.
33Subject to comments to be made later in these Reasons, I find that the parties' property and liabilities (as at the date of trial) are as set out and identified in the following table – which I shall call the property schedule.
The Property Schedule
Parties' Assets 1 [Property A] $423,333 2 [Business A]– $0 3 Respondent's Truck $100,000 4 Respondent's [Utility 1] $26,000 5 Respondent's [Utility 2] $28,000 6 Respondent's Trailer (unregistered) 7 Respondent's [registered Trailer 1] 8 Respondent's [registered Trailer 2] 9 Respondent's [registered Trailer 3] 10 Respondent's business equipment 11 Respondent's sea containers $38,200 12 [Business B] $0 13 Respondent's savings $20 14 Respondent's furniture $4,000 15 Applicant's [Barina] $13,800 16 Applicant's [Falcon GT] $8,840 17 Applicant's savings $5,054 18 Applicant's 50% interest in [Suburb S] property $94,000 19 Applicant's furniture $5,000 20 Applicant's box trailer $100 21 Respondent's legal fees (paid) $9,438 22 Applicant's legal fees (paid) $34,715 TOTAL ASSETS $790,500 Parties' Liabilities 23 Respondent's ANZ home loan $189,702 24 Respondent's business loan $21,298 25 Respondent's business overdraft $99,998 26 Respondent's Macquarie truck loan $48,968 27 Respondent's visa card ending [xxx] $33,295 28 Respondent's GE credit card ending [xxx] $3,816 29 Respondent's [Ford] finance 1 $30,375 30 Respondent's [Ford] finance 2 $28,806 31 Applicant's visa card $1,748 TOTAL LIABILITIES ($458,006) PARTIES' NET POSITION $332,494 Superannuation / Resources 32 Applicant's superannuation $76,679 33 Respondent's superannuation $29,859 TOTAL SUPERANNUATION $106,538 GRAND TOTAL
$439,032
34It can be seen from the property schedule that the total net value of the parties' property is $439,032 – of which $76,679 comprises the value of the wife's superannuation entitlements at trial and $29,859 comprises the value of the husband's superannuation entitlements at trial.
35It was not in dispute that the parties' respective superannuation entitlements should be included in the overall "pool" of property available for distribution between them. Further, there was no suggestion that the parties' contributions to their superannuation interests should be treated or assessed any differently to their contributions to other items of property. In other words, a "global" approach was adopted. It was accepted, however, that – unlike proceedings for alteration of property interests under the FLA – the Court does not have power in proceedings for alteration of property interests under the FCA to order what is commonly referred to as a superannuation split. In other words, the Court does not have power to alter the parties' interests in their superannuation entitlements. It follows that, irrespective of the outcome of the proceedings, each party will retain his/her superannuation entitlements.
36According to the property schedule, the total value of the husband's property (excluding paid legal fees) is $619,553.
37That property comprises Property A, the husband's business interests, his truck and two [utility] vehicles, various trailers and business equipment, another business known as the [Business B], some savings and some furniture, chattels and effects.
38The wife's property (excluding paid legal fees) has a total value of $126,794. It comprises the wife's [Barina] motor vehicle, a [Falcon GT] motor vehicle and some savings, the value of which the husband queried. I am satisfied, however, that the wife's savings are, indeed, $5054 at the present time. The wife also has a 50% interest in a property in [Suburb S, Queensland] worth $94,000, and some furniture and a box trailer.
39The property in [Suburb S] was acquired after the parties separated and there can be no doubt that the husband has made no contribution to its acquisition; nor has he made any contribution to its conservation or improvement. Nevertheless, the wife owns it and for the sake of the property settlement exercise I have included it in the property schedule, as the law requires me to do.
40There are two other "notional" assets to which reference should be made. They comprise the legal and associated fees paid by the parties. Obviously, if these moneys had not been paid by the parties, they would now be available in one form or another for distribution between them. They might still remain as savings of the parties, or they might be incorporated in some other form of asset. The legal fees paid by the husband total $9438; the legal fees paid by the wife total $34,715.
41That the parties' paid legal fees should form part of the property available for distribution between them is entirely uncontroversial: see NHC & RCH (2004) FLC 93-204 at [55]-[60]; see also Harrington & Harrington and Ors (2007) FLC 93-317 at [18]‑[19]. Although the manner in which the Court deals with funds used by the parties to pay legal fees is a matter for its discretion, the following observations are of relevance:
(a)As Murphy J recognised in Hayton & Bendle [2010] FamCA 592 at [127], the payment of legal fees by a party amounts to a premature distribution of property that might otherwise have been available for distribution between both parties in accordance with the Court's ultimate assessment of their property settlement entitlements.
(b)Although the payment of other expenses (including accommodation or living expenses) after separation and prior to trial might also have the effect of removing funds from the "pool" of property that could otherwise be available for distribution between the parties, legal fees related to advice dealing with the consequences of a relationship breakdown or anticipated breakdown and family law issues generally, dispute resolution or court processes would not have been paid at all if the parties' relationship had not broken down or was not likely to break down, or if the parties did not have a dispute to resolve or court proceedings to conduct. To that extent, it is unfair to allow one party what could amount to unfettered or almost unfettered access to funds that would otherwise comprise property available to be dealt with pursuant to the provisions of s 79 (s 205ZG of the FCA) to further his or her own side of the case or counter or damage the other party's case.
(c)I am satisfied that both parties should be seen as having an interest in the funds used for the payment of legal fees – whether those funds existed at the date of separation or became available to the parties thereafter.
42The husband's liabilities referred to in the property schedule comprise a total of $456,258; the wife's liabilities, which comprise her current Visa card liability, total $1748. The husband's liabilities include an ANZ home loan, a business loan, a business overdraft, what is described as a truck loan, some credit card liabilities and some liabilities associated with the two utility vehicles. As indicated, those liabilities total $456,258.
43The husband asserted that he had very significant additional liabilities, but so poor a witness was he, and so unreasonable was he in his approach to the litigation, that I have little confidence in his credibility. Although I accept that the husband does have some additional liabilities, it is not possible to ascertain precisely what they might be, because, as Mr Kroon has correctly submitted, there is a degree of 'double dipping' in relation to those liabilities. I accept, however, that there are some liabilities that the husband currently has that are not included in the amount of $456,258 to which I have referred.
44The property schedule reveals that the husband has assets worth $619,553 plus paid legal fees of $9438, but he has liabilities of $456,258. It follows that his total net asset position, leaving aside the superannuation entitlements (to which I shall refer in a moment), is $172,733. The wife has assets valued at $126,794 including her half interest in the Suburb S property. Her paid legal fees amount to $34,715, and she has liabilities of $1748. Accordingly, her net asset position (leaving aside superannuation) is $159,761.
45It follows that the total net value of the parties' property, excluding superannuation, is $332,494. The total net value of the husband's property, excluding superannuation, is $172,733 – although, as I indicated, I accept that there are other liabilities which, at this stage, are unclear and about which I am unable to make any sensible on principled finding. The total net value of the wife's property, excluding superannuation, is $159,761.
46As I have explained, the Court cannot make orders for the splitting of superannuation in de facto property proceedings, but there is no reason why the Court cannot treat superannuation as a notional asset, and I propose to do so. The wife has superannuation entitlements valued at $76,679; the husband has superannuation entitlements valued at $29,859.
47It follows that the value of the husband's total net assets is $202,592 – subject to the comments I made earlier about unspecified liabilities. The value of the wife's total net assets is $236,440. In other words, and including the Suburb S property, the wife's current net asset position is in fact stronger than the husband's current net asset position.
48The total net value of the parties' property, including their superannuation entitlements, is $439,032.
Preliminary considerations
49Before proceeding further with what might be perceived as the next relevant step in the property settlement exercise, it is pertinent to record that I do not propose to proceed with that exercise by applying a general assumption to the effect that the parties' rights to or interests in their property should be different from those that now exist. I reject that assumption. In other words, I recognise that the core issue for determination in these proceedings is whether the parties' rights to and interests in the property contained in the property schedule should be altered: see the High Court's decision in Stanford.
50It is also pertinent to record that consideration of the various factors in s 205ZG(4) – including the parties' contributions in all their various guises – does not automatically give rise to a right on the part of either of the parties to have the property contained in the property schedule divided between them by reference to those factors. The "just and equitable" requirement in s 205ZG(3) must be (separately) considered and applied. I am conscious of the need not to conflate the requirements or considerations contained in s 205ZG(3) on the one hand, and s 205ZG(4) on the other.
51As explained above, however, the parties in this case separated well before the commencement of property settlement proceedings. It is readily apparent that the express and implicit assumptions underpinning the property arrangements they had made during their cohabitation have been brought to an end by the "severance of the mutuality of the marital relationship" – or, in this case, the severance of the mutuality of the marriage-like relationship. Further, any assumption the parties may have had to the effect that they could change or adjust their property arrangements consensually (as each may need or desire) no longer applies. It follows that it can be considered just and equitable that the Court should make a property settlement order (which order is to be determined by applying s 205ZG(4), including the s 205ZD(3) factors): see, again, the High Court's decision in Stanford. Indeed, I find that, in the circumstances of the case now before me, it is just and equitable within the meaning of s 205ZG(3) to alter the existing interests held by the parties in their property.
52I would add that both parties want the Court to make orders altering their property interests now that their relationship has ended.
53Lest the husband think that the Court has ignored his plea to it about his earning capacity and the financial difficulties he confronts, I note that s 205ZG(4)(d) directs the Court to take into account the effect of any proposed order upon the earning capacity of either party to the marriage.
54The Court is conscious of the fact that, according to the husband, his financial position is dire: he is concerned that he may not be able to retain income earning assets or that he may have to sell Property A (which he owned at the commencement of cohabitation). The fact of the matter is, however, that there is no such thing as "quarantined" property in property settlement proceedings. In my opinion, the effect of the Full Court’s decisions in Farmer & Bramley [2000] FamCA 1615, Bonnici & Bonnici (1992) FLC 92-272, Figgins & Figgins [2002] FamCA 688 and GS & TS [2005] FamCA 40 is – in the context of the present case – Property A cannot be regarded as any form of protected or quarantined property. The totality of the parties’ contributions (in all their various guises), must be considered, and they must be considered for the whole of the period from the commencement of cohabitation to the date of trial. Clearly, however, significant weight must be given to the fact that the husband’s interest in Property A represents a substantial (and contextually very early) contribution on his part. Much the same can be said of the Suburb S property – which represents a substantial (and contextually very late) contribution on the wife's part.
55It is often the case that one party would much prefer not to have to dispose of an asset in order to meet a claim made by the other party; but justice must be done to both parties, not to one party only.
56In this case, I am certainly not satisfied that the husband's true financial position is as dire as he would have the Court believe.
57I refer in this regard to the husband's comment that he has spent what would appear to in excess of one year in working hours fighting this case. Regrettably, he saw fit to raise issues that were never going to be of any relevance. Had he taken the time to do appropriate research and give consideration to what that research revealed, or in fact attended a mediation, he might have had a better idea of what was relevant and what was not. The husband only has himself to blame for allowing his business to run down to the extent that he says it has by focusing on these proceedings to an obsessive degree, and by trying to defeat the wife's claim at almost any cost – instead of exercising his earning capacity.
58Having said that, I accept that there has been a downturn in the industry in which the husband operates. Further, I accept that one of the husband's competitors has recently gone out of business – although I would have thought that this probably presents an positive opportunity for the husband, as opposed to his suggestion that it may lead to him being the next cab off the rank (as it were) as far as business failures in this area are concerned. In all the circumstances, and given that the husband was such a poor witness and historian that I have difficulty accepting anything that he says in relation to his financial position, I am not prepared to find that the husband's earning capacity is seriously threatened.
59Mr Kroon's relatively short cross examination of the husband revealed that the financial statements for the husband's business entities show a consistent pattern of liabilities being met throughout the years until the 2015 financial year, when the husband's net income dropped radically. In my opinion, the likelihood is that as soon as these proceedings are completed, the husband will refocus on exercising his earning capacity and that he will soon be able to earn, if not what he earned four or five years ago, then what he was able to earn two or three years ago. That is my finding in relation to the husband's future earning capacity.
Contributions and s 205ZD(3) factors
60Having identified the pool of property available for distribution between the parties, I now turn to consider the next "step" in the property settlement exercise – namely, the identification and assessment of the parties' contributions in all their various guises.
61In Dickons & Dickons [2012] FamCAFC 154, the Full Court said at [24]-[25]:
There can be little doubt that the classification of contributions by reference to terms such as "initial contributions", "contributions during the relationship", and "post-separation contributions", can be helpful as a convenient means of giving coherent expression to the evidence in a s 79 case and to giving coherence to the nature, form and extent of the parties' respective contributions. However, the task of assessing contributions is holistic and but part of a yet further holistic determination of what orders, if any, represent justice and equity in the particular circumstances of this particular relationship. So much is clear from the terms of s 79 itself and, in particular, s 79(2). The essential task is to assess the nature, form and extent of the contributions of all types made by each of the parties within the context of an analysis of their particular relationship.
Doing so is also consistent with the demands of authority that the ultimate assessment of contributions should be made without "…giving over-zealous attention to the ascertainment of the parties' contributions…" (Norbis v Norbis (1986) 161 CLR 513 at 524) and the well-established recognition in the authorities ... that the process required of the Court by s 79 is the exercise of a wide discretion, not the performance of a mathematical or accounting exercise.
62Further, it is not always possible to balance "like with like", in that the parties' various contributions can have very different characteristics and may carry very different weight. Similarly, the timing of the forms of contribution can be telling. In a very broad sense, the exercise is what might be considered an imprecise, macrocosmic one – as opposed to a detailed, microcosmic analysis of the source and destination of each dollar passing through the parties' hands and their every action, inaction or reaction (however small or insignificant).
63I turn now to the sorts of matters raised in the papers for the judge as the parties' contributions. I will start with the wife's contributions because she is the applicant. She is legally represented, and her papers for the judge are in a more readable and structured forum than the husband's papers for the judge.
64Under the general heading of financial contributions, the wife has asserted that in July 2009 she paid the husband $5000 to transport her possessions from New South Wales to his home in Western Australia. Later on, she received just under $35,000 by way of property settlement from her marriage to [Mr J]. These moneys, along with other moneys that she earned during the course of the relationship, were provided to the husband or used directly or indirectly by him, for the benefit of the parties. Some of the funds provided by the wife comprised payments that were made towards the mortgage over Property A. Other payments went towards business debts of the husband.
65I find, therefore, that the wife's financial contributions as contemplated in s 205ZG(4) were not insignificant. For example, I am satisfied that she had some $40,000 that was paid directly or indirectly to the husband or for his benefit in one form or another. I accept, that there would have been expenses associated with the transport of the wife's possessions from New South Wales to Western Australia. As a result, I have not given a great deal of weight to that initial payment.
66The wife did not work in paid employment from May to August 2009. She asserts that she was responsible for all home duties at that time. Further, she worked on an unpaid basis in the husband's business, and she accompanied him on trips. She also undertook some driving of a [business vehicle], did some invoicing, prepared policy and procedure manuals and assisted with marketing and brochure and website designs.
67In my view, it is likely that the wife has exaggerated her contributions in these areas. I find, however, that she worked to the extent that she was able, and she assisted the husband where necessary. Nevertheless, he was the primary "driver" of the business – and I do not mean driver in the sense of the person who drives vehicles but in the sense of the person who managed the business and was responsible for all major or commercial aspects of it. I am satisfied that the wife was of considerable assistance to him in those roles, and that if the wife had been unable to provide that assistance to the husband, he would have had to pay somebody else to do so.
68Each party had assets at the commencement of the relationship, although I accept that the husband's assets were of greater value than those of the wife at that time.
69I do not give a great deal of weight to the work done by the wife in the husband's business. Although she did assist him in the manner to which I have referred, and although her contributions in this regard are not to be ignored, the effect of these contributions should not be exaggerated.
70I accept that the wife was the primary homemaker. The reality is, however, that this was a very small family of two people, and the Court cannot give an enormous amount of weight to this form of contribution – as it was made for a relatively short period of time.
71In August or September of 2009, the wife commenced part-time employment [for a] Community Support Group, and she continued to work on an unpaid, part-time basis (as she describes it) in the husband's business. In December 2009 she obtained additional part-time employment. She continued to work in the husband's business and for the support group to which I have referred. Her wages were paid into her bank account, and the husband, directly or indirectly, had the benefit of those wages – but so, of course, did the wife.
72That is not to say that the husband had the benefit of all the moneys earned by the wife, but he had the benefit of some of them, in that the wife contributed moneys to the parties' marriage-like "partnership". In using this term, I am not referring to a formal partnership; I mean, instead, a partnership of two people living in a de facto relationship. As I have indicated, the wife used some of the funds available to her to contribute towards mortgage payments for the benefit of the husband. She also used some of the funds available to her to pay various accounts, a schedule of which is included in the wife's material. I accept that the wife made the payments referred to in the schedule.
73It is clear, therefore, that some tens of thousands of dollars were paid by the wife for the benefit of the husband (whether directly or indirectly). The wife asserted that the husband was controlling with money during the relationship and was adamant about how the wife's money should be spent. Having seen and heard the husband, I have not the slightest doubt that he was controlling and demanding in that regard, and I accept the wife's evidence in relation to this subject. The husband gave every impression of being a determined, stubborn and unreasonable person.
74At one point the Court asked the husband to concede that he was wrong in relation to a matter that he was clearly wrong about – which matter concerned the wife's alleged use of a substantial amount of money to pay certain medical or radiological expenses. The fact of the matter is that the husband had simply misread a bank statement. It took four or five direct questions before the husband finally, reluctantly and somewhat resentfully conceded that he was wrong. In my view that piece of evidence says a great deal about the husband: he showed himself to be an arrogant and stubborn man.
75That does not mean, however, that he has not made the various contributions that the wife concedes he has made, and some of the contributions that he says he has made – but it says much about the difficulty that the wife has had in trying to negotiate a reasonable settlement of her claim during the course of the proceedings.
76In para 13 of the wife's papers for the judge, she says that the majority of her income was used to pay the parties' bills and living expenses, so that the husband's income could be applied towards the mortgage repayments and the business expenses. I accept the wife's evidence in this regard.
77The wife's taxable income during the relationship is set out in her papers for the judge. It totalled about $114,000. By contrast, the husband's taxable income during the same period was approximately $31,500. As Mr Kroon conceded, however, the husband is well aware of the benefits of minimising one's taxation liabilities. I do not suggest that the husband has minimised tax in any illegal or inappropriate manner, but I am satisfied that he had a strong desire to reduce or avoid tax wherever possible. It follows that I am satisfied that his real disposable income – as opposed to his taxable income – was significantly higher than the amounts reflected in his income tax returns.
78The financial statements to which reference was made during Mr Kroon's cross-examination reveal the significant amounts of money that were received and paid out during the relationship, and in subsequent years.
79As explained above, the Court is not involved in a strict accounting exercise. It is not the Court's role to audit the income and expenditure of each party. The Court has to approach the property settlement exercise on what has been described as a "holistic" basis. It follows that the Court is not obliged to trace the source and destination of each dollar that went through the parties' hands. It is enough to recognise and acknowledge that funds were earned by the parties, or otherwise brought into the relationship, and that those funds were used (during the relationship, at least) primarily for the benefit of both parties. The Court must also have regard to events which have occurred since the date of separation.
80The wife asserts that she made financial contributions towards the husband's business including purchasing storage chests, racking for a sea container and a shed. In my view these comprise very minor financial contributions which are only mentioned in order to bolster the wife's case. The reality is that they do not make a great deal of difference to the outcome of the proceedings.
81In October 2010, the wife purchased a Barina. Both parties used the vehicle. The wife complains that the vehicle later sustained damage. That is not relevant to anything I have to determine. Unfortunately, the inclusion of this evidence indicates that, like the husband, the wife can also take an unreasonable approach to the litigation. I accept, however, that the unreasonableness of the wife's approach to the litigation pales into insignificance in comparison with the husband's bloody-mindedness.
82In or about July 2011, the wife commenced work as a [FIFO worker] on a two week on, one week off fly-in, fly-out basis with [Company I]. As I have indicated, the parties separated less than a year after she commenced that employment. According to the wife, she continued to work for Company I after separation and, at the same time, continued her unpaid work in the husband's business. As I have already said, however, I view the wife's evidence in relation to her contributions to the husband's business as being exaggerated – although I do not doubt that she did some work to assist him.
83I accept that after the wife commenced fly-in, fly-out work she continued to pay for household supplies and groceries and other outgoings associated with Property A, even though she was only living at the home for one week in every three. The fact of the matter is that Property A was the parties' home. The wife says that she paid for the majority of household supplies. I do not know whether she did, and I make no finding one way or the other, but I am satisfied that she did make financial contributions for the benefit of the family. In this regard, little turns on whether she paid for the majority or the minority of household supplies.
84In about 2011, the wife obtained a heavy duty driver's licence at the husband's request. Thereafter, she occasionally assisted the husband by accompanying him on long overnight trips. She also did some driving.
85At the end of the day, it is of little assistance to endeavour to over-analyse the contributions made by each party. As indicated above, I accept that the wife was the primary homemaker during the relationship and that she performed the majority of the household duties – including shopping, cooking, washing and cleaning. The husband also did household duties, and, of course, he was left to do household duties when the wife was doing her fly-in, fly-out work. When both parties were available, however, it was the wife who was predominantly responsible for these tasks. The wife said, and I accept, that when she commenced her fly-in, fly-out work she attended to the majority of household duties on her week off and that she cooked bulk meals. In the context of a relatively short relationship, however, the wife's evidence in this regard does not make a significant difference to the Court's assessment of the parties' respective contributions.
86Fortunately, and although the subject is referred to in the papers for the judge, no time was wasted on fruitless arguments about the parties' pets. I need not mention the subject further.
87The wife has made mention of events that occurred at or around the time of separation. Such events are of little relevance to the property settlement exercise, and – to the credit of the parties – they were not explored during the trial.
88In para 6 on page 10 of the wife's papers for the judge, she says that at the beginning of the parties' relationship she had assets valued at approximately $78,600. She then asserts that, although she had three jobs and worked in the husband's business, at the end of the parties' three year relationship she only had assets valued at approximately $50,000 (including superannuation). This comprises a decline of about $28,500. Of course, parties in a marriage or marriage-like relationship may choose to spend money on a wide variety of things, whilst at the same time meeting their living expenses and outgoings. There is nothing unusual about parties having fewer or less valuable assets at the end of a relationship than they had at its commencement. Still, I take into account the fact that the wife was earning income from paid employment, that she had assets at the commencement of the relationship and that moneys to which she would otherwise be solely entitled were used for the benefit of both parties. By way of contrast, the wife points out that, although the exact values of the various vehicles and trailers for the business are not known (or were not known at the time the wife's papers for the judge were prepared), Property A has increased in value, the property mortgage, truck loan and other loans have been reduced and the husband's overall financial position has improved. In this regard, I find that the improvement in the husband's financial position reflects, to some extent, the wife's contributions as well as his own contributions.
89In para 8 on page 10 of her papers for the judge, the wife says that her superannuation entitlements had a value of approximately $42,000 at separation, and that they currently have a value of approximately $76,600. I am satisfied that the husband has made no real contribution to the increase in the value of the wife's superannuation entitlements. There was no evidence to suggest otherwise.
90In para 9 on page 10, the wife says that on 11 February 2014 (in other words, well after the parties separated) her father transferred to her half of his property in Suburb S, Queensland by way of gift. The value of the Suburb S property has been agreed at $94,000. It is clear beyond argument that the husband has made absolutely no contribution to that property in any relevant sense.
91Turning then to the husband's contributions, I would observe that it is very difficult to wade through the sorts of matters raised by him in his papers for the judge – and, indeed, in his prolix and unnecessarily voluminous affidavit material. I am satisfied that he is a person who is consumed with bitterness about the breakdown of the relationship. He complains about a great many matters; indeed, he complains about almost everything. For example, when he was asked to set out on page 7 of his papers for the judge what issues may have been agreed between the parties, he wrote, without embellishment, the word "nil".
92In other words, absolutely nothing could be agreed. I am satisfied that the single word "nil" accurately reflects the husband's bloody-mindedness, and his general refusal to attempt to negotiate until the formal commencement of the trial.
93I note that the husband does not deal with the issue of contributions in any detail in the early part of his papers for the judge. He does complain, however, about certain moneys allegedly removed by the wife from various accounts. That allegation was not explored at trial and I do not propose to deal with it.
94I have already referred to para 16 on page 6 of the husband's papers for the judge – in which he refers to spending 2200 hours preparing Family Court documentation. He indicates that he seeks financial compensation of close to $170,000.
95I find that the husband's claim in this regard is preposterous. It went nowhere at trial, and the husband did not spend any time cross-examining the wife in relation to it. I do not propose to dignify the claim by spending time dealing with it in these Reasons.
96I turn now to other factors raised by the husband. Although they appear under a heading relating to s 205ZD(3) factors, they include some considerations relevant to contribution issues.
97The husband makes reference to his and the wife's state of health. I note, however, that he has not produced any evidence in admissible form regarding his state of health.
98I accept that the husband has some minor health issues, but having seen and heard him during the course of the trial, including seeing him easily lift very large boxes and move them around, and having been advised by him that he has driven backwards and forwards from Bunbury to Perth to enable the trial to proceed, I am not satisfied that his health comprises any form of impediment to his earning capacity.
99The wife does not assert that her health impedes her earning capacity. It is not in dispute that the wife has steady, full-time employment through Company I.
100The husband says he is a self-employed driver and transport business operator. He says his business has been declining since around July of 2011. I accept that there has been a downturn in the husband's business, although I do not accept that the downturn is anywhere near as serious that the husband would want the Court to believe.
101As I indicated earlier, I have no doubt that when these proceedings are over the husband will return to giving his business his full focus and attention, and that his income will increase accordingly. As was apparent from the husband's cross-examination, he was able to make sufficient moneys to meet his liabilities associated with the business in all years prior to 2015.
102The husband also speaks of taking many days off work due to preparing this matter for trial. I have already said all I need to do about his behaviour in that regard.
103The husband asserts that there has been an even greater downturn in business since 1 July 2015, and that his income is less now than it was in the previous financial year. I do not accept the husband's evidence in this regard. Mr Kroon submitted – and, having seen and heard the husband, I accept – that the husband has, to use a colloquialism, taken his foot off the pedal. I find that, as soon as these proceedings are over, the husband will resume working as effectively as he did in the past; I also find that his income will increase commensurately.
104That is not to say that the husband will be able to earn an enormous income – but I find that he will be able to earn an income of something in the order of $80,000 to $100,000 per annum.
105The husband complains of not being in a position to make any kind of offer (for a variety of reasons) and of having little work available. He also complains of being unable to meet current ongoing business and personal liabilities. I do not accept any of the husband's complaints in relation to these matters, and I am not persuaded by his evidence in relation to them.
106In my view, it was always within the husband's capacity to make some sort of offer to settle the proceedings, even if it was an offer which involved payment on terms. Regrettably, the husband was simply not prepared to confront the real issues in the case and approach them in a mature and responsible fashion.
107Although the husband speaks of Property A reducing in value over the last 12 months, the fact of the matter is that the parties agreed the value of the property at approximately $423,000.
108The husband submits that the Court should regard the parties' respective contributions during the period of cohabitation as being approximately 78% in the husband's favour and 21% in the wife's favour. He then seems to refer to financial and non-financial contributions and appears to suggest that contributions should be looked at on the basis of 70% to the husband and 30% to the wife, with post-separation contributions to be assessed on the basis of 100% to the husband and 0% to the wife (see the husband's papers for the judge at page 10). It is difficult to follow what the husband means by these percentages, although I assume that the husband is asserting that the wife made no contribution to his assets after the date of separation. If that is the husband's intention, then it is arguable that much the same thing can be said about his contributions to the wife's assets after the date of separation.
109In relation to s 205ZD(3) factors, the wife refers to the ages of the parties and says that they are both in reasonably good health for their age.
110As I have indicated, I accept that the husband has some health issues – but I do not accept that they impact on his earning capacity. The wife says that she has a current income of about $64,500 per annum. I have found that the husband has an earning capacity that is considerably greater than that if he is minded to exercise it (and I have little doubt that he will be minded to exercise it after the completion of these proceedings). Even if I am wrong in this regard, and the husband's earning capacity is not as high as the figures I referred to earlier, I am comfortably satisfied that his earning capacity is not lower than the amount the wife is currently earning. In other words, I find that the husband has the capacity to earn at least as much as the wife presently earns.
111Additionally, and as Mr Kroon has submitted, the husband could elect to restructure his business interests. I am satisfied that, if he were minded to do so, he would be able to comfortably generate the income to which I have referred above (being something in the order of $80,000-$100,000 per annum). Once again, I find that he has the capacity to earn not less than the amount the wife is presently earning. The reality is that the husband does not have to continue to operate the business with the types of liabilities that it has if it is an unsuccessful as he says it is, and if the prospects for improving the profitability of the business are as bleak as he suggests. I have indicated, however, that I do not accept his evidence in that regard.
112Neither party has children who are under the age of 18 years.
113The wife indicates that she is in a de facto relationship with Mr D. I need not go into details in relation to that.
114The wife deposes to the fact that she is not in receipt of any pension or allowance or benefit from the government. She speaks of a standard of living that is not commensurate with the income that she earned during the period of the relationship.
115Since separation, the husband has had the sole benefit of the contributions made by the wife during the relationship. There can be no argument in that regard, because it is conceded by the husband that the wife made payments towards the mortgage over Property A and towards other liabilities. The husband has had the benefit of those payments because he retains those assets. The downturn in the husband's business, if downturn there is, has nothing to do with the wife. I would add that, if there had been an upturn in the husband's business, then the wife would not have contributed to that either and the husband may have been entitled to argue that his contributions to the increased assets were significantly greater than those of the wife.
116It does not appear that the husband is cohabiting with anybody else.
117At the end of the day, the wife argues that there should not be any adjustment to take account of the s 205ZD(3) factors. I agree with that submission.
118I need not discuss either party's arguments about these factors any further because, as I have said during the course of the trial, I am satisfied that the s 205ZD(3) factors do not favour one party over the other.
Conclusion regarding the parties' respective contributions
119The Court is not concerned with either punishing or rewarding one party or the other, as it were. The Court's obligation is to make such orders in relation to property settlement as it considers appropriate, and not to make such orders – or any orders – unless it is satisfied that, in all the circumstances, it is just and equitable to do so. I have discussed the way in which the Court should approach this exercise elsewhere in these Reasons. The law does not require the Court to make findings or orders with which the parties will be comfortable. The Court must consider the parties' submissions and proceed to do the best it can in the light of those submissions and on the basis of the law and the evidence before it.
120That an assessment of the parties' respective contributions is not a strict mathematical or accounting exercise is uncontentious. As I have said above, it is not always possible to balance "like with like", in that the parties' different forms of contribution can have very different characteristics and may carry very different weight. Similarly, the timing of the forms of contribution can be telling. Again, it bears repeating that "the task of assessing contributions is holistic and but part of a yet further holistic determination of what orders, if any, represent justice and equity in the particular circumstances of [a] particular relationship": see Dickons & Dickons (supra); see also Bolger & Headon [2014] FamCAFC 27 at [23] to [28].
121There are two ways that the Court can proceed. One way is by effectively excluding the Suburb S property from the property schedule in which case the parties' property, instead of having a total value of $439,032, would have a total value of $345,032, and instead of the wife being deemed to be retaining property and superannuation worth $236,440, she would be deemed to be retaining property and superannuation worth $142,440. The other is to include the Suburb S property.
122I have some discomfort with removing the Suburb S property entirely from the property settlement exercise because it is an asset owned by the wife. Nevertheless, I propose to give her full credit for the contribution she has made in that regard. If I include the Suburb S property in the pool, then the figures are in accordance with the property schedule.
123When I have regard to all the evidence relating to the contributions made by the parties, including their financial contributions of a direct and indirect nature to the acquisition, preservation and improvement of property from the commencement of cohabitation to today, and the direct and indirect non-financial contributions made by both parties to the property from the date of commencement of cohabitation to the date of trial and their respective contributions to the welfare of the family, I am satisfied that an appropriate allowance would be something in the order of 60% to 65% for the wife.
124Put another way, in all the circumstances (including the time that has passed since separation), I conclude that something between 60% and 65% of the parties' property (which, of course, includes their superannuation entitlements) should be awarded to the wife on the basis of her contributions (in all their various guises) from the commencement of cohabitation to the present date, and the balance (being something between 35% and 40%) to the husband on the same basis.
125The above figures are on the basis of including the Suburb S property. If the Suburb S property were to be excluded, then I am satisfied that the appropriate division would be something in the order of 50% to 55% to the wife.
126In my opinion, the most principled approach is to include the Suburb S property in the manner I have described. It follows that a just and equitable division of the parties' property to reflect their respective contributions (in all their various guises) from the commencement of cohabitation to the date of trial is something between 60% to 65% to the wife and 35% to 40% to the husband.
127In G & G [2004] FamCA 1179, the Full Court said (in relation to an exercise of judicial discretion such as that which I have performed in the previous paragraphs):
…[Words] will often (perhaps always) fall frustratingly short of an incontestable explanation for any particular exercise of discretion – or, for that matter, for a finding by an appellate court that a particular exercise was wrong. All the relevant factors can be described, with modifiers in abundance, but still the analysis will beg the question, “Yes, but why that figure and not another?” or “Why was that the range rather than some other parameters?”
The deficiency is unavoidable. When there are a number of “right” results available, the explanation for the choice of one over others can never be incontestable. Nor can the reasons for saying that a result is outside a range be beyond challenge. The very nature of a discretionary exercise that ascribes mathematical consequences to a batch of actions and events amenable only to descriptive evaluation, means that it is impossible to place beyond argument the explanation for all the steps to the ultimate selection of result. ...
(In) respect of virtually every exercise of discretion, by definition, it will not be possible to deliver a judgment which excludes reasoned argument that another result was available.
128For what it is worth, I concur with the Full Court’s view as expressed in the passage from G & G (supra) quoted above. The "balancing exercise" that the Court must perform is rarely an easy or non-contentious one. It is also worth noting what Coleman J, sitting as a single judge exercising appellate jurisdiction, said in a well-known passage from Steinbrenner & Steinbrenner [2008] FamCAFC 193:
Given that the evaluation of contribution based entitlements inevitably moves from qualitative evaluation of contributions to a quantitative reflection of such evaluation, there will inevitably be a “leap” from words to figures. That is the nature of the exercise of discretion, whether it be in the assessment of contributions in the matrimonial cause, assessment of damages in a personal injuries case, or determination of compensation in a land resumption case.
Conclusion in relation to the s 205ZD(3) factors
129So far, in considering the question of property settlement, I have dealt with the identification of the parties' property and related issues. I have also dealt with the parties' contributions (in all their various guises). The Court has power to adjust the parties' property settlement entitlements based on such contributions in order to take account of, among other things, both parties' respective means and needs. The Full Court has been critical of shorthand terms being used to describe this step in the FLA property settlement exercise, preferring to refer to it simply as “the s 75(2) factors”: see Clauson & Clauson (1995) FLC 92-595. In essence, s 75(2) is concerned with the process of arriving at a just and equitable result: see, in that regard, Waters & Jurek (1995) FLC 92-635.
130The same can be said of the s 205ZD(3) factors.
131I have already discussed all relevant s 205ZD(3) factors. Having regard to those factors and all the other matters discussed in relation to s 205ZD(3), I have concluded that there should be no adjustment in favour of either party. In my opinion, to make such an adjustment in the circumstances of this case would be to run the risk of making orders which are neither just nor equitable.
132I have already referred to the Full Court's observations in G & G (supra) and Coleman J's comment in Steinbrenner & Steinbrenner (supra). In this case, as in many others, the "balancing exercise" that the Court must perform is neither easy nor non-contentious. I am satisfied, however, that my discretion has been exercised in such a manner as to avoid a result that is something other than just and equitable.
133Taking into account the fact that the s 205ZD(3) factors do not favour one party or the other, and bearing in mind that the husband is likely to have some liabilities which are not included in the property schedule (which liabilities could conceivably have some impact on the overall justice and equity of the proposed property settlement orders) my conclusion is that the overall distribution of the parties' property (including superannuation) between them should be on the basis of 62.5% to the wife and 37.5% to the husband.
Just and equitable?
134As indicated above, the High Court in Stanford explained that the consideration of the various factors in s 205ZG – which includes reference to the s 205ZD(3) factors – does not automatically give rise to a right on the part of one or other of the parties to have the property divided between them by reference to those factors. The requirement contained in s 205ZG(3) must be considered and applied.
135In this case, and as discussed above, the parties separated before the commencement of property settlement proceedings. It is arguable, therefore, that the express and implicit assumptions that underpinned the property arrangements that they had made during their cohabitation had been "brought to an end by the voluntary severance of the mutuality of the [marriage-like] relationship". It follows that it is just and equitable for the Court to make a property settlement order. That order is to be determined by applying s 205ZG(4), although, clearly, the form of the order must also be just and equitable. Further, and as I have indicated, both parties have requested the Court to make appropriate property settlement orders.
136In any event, I propose to (metaphorically) step back and consider whether the outcome achieved by my consideration of the parties' contributions and the s 205ZD(3) factors has brought about a just and equitable result.
137Before turning to mathematics and the relevant calculations necessary to breathe life into the conclusions I have reached, it is necessary to define a "starting point", as it were. In other words, I will record that – as I understand the orders sought by the parties – the husband will be retaining Property A, his business interests, his paid legal fees and the other assets and liabilities identified as being his in the property schedule. He will also be retaining his superannuation entitlements.
138It follows from the above that the total net value of the property currently in the husband's possession or under his control is $202,592. It also follows that the total net value of the property currently in the wife's possession or under her control is $236,440. Her property comprises her 50% interest in the Suburb S property, her paid legal fees and the other assets and liabilities identified as being hers in the property schedule.
13962.5% of $439,032 is $274,395. Given that the wife is retaining property and superannuation to the total value of $236,440, however, it is apparent that the amount she should receive from the husband is $37,955 – which I shall round down to $37,950. That is the amount I propose the husband should pay to the wife.
140I am very conscious that justice and equity must be done to both parties. I am satisfied that the split I have proposed achieves that result. In other words, I am satisfied that the orders that I propose to make are just and equitable – and lest it be suggested otherwise, I confirm that I have taken into account the effect of the proposed orders on the husband's earning capacity. Having regard to the findings I have made regarding his earning capacity, I am comfortably satisfied that the orders will have no significant adverse effect on his earning capacity.
141I am satisfied that the husband has the capacity to pay the amount of $35,950 to the wife, but that he should be permitted some time within which to do so. During that period, he can refocus on his earning capacity and put behind him the absurd amount of time he asserts that he has spent in trying to defeat the wife's claim.
142Finally, I confirm I have "stepped back" at the end of the property settlement exercise to consider whether the orders I am making are indeed just and equitable. I am satisfied that they are just and equitable to both parties. As I noted earlier, Mr Kroon gave a range of possible results from the wife's point of view. The figure that I have come to is within that range.
143The range suggested by the husband involved payment of something between $15,000 to $20,000 to the wife. Although the figure that I have determined is appropriate is above that range, it is not significantly above it (in real terms). In my view, and at the end of the day, I am satisfied the figure is a just and equitable one and that it reflects the evidence before me.
Orders
144In all the circumstances, and having regard to the parties' submissions regarding an appropriate period within which the husband must pay the amount of $37,950 to the wife, I propose to make the following orders:
Dictionary
1 In these orders –
(a)words in the singular number include the plural and words in the plural number include the singular; and
(b)the words day and days bear their ordinary meanings, and include Saturdays, Sundays and public holidays.
Payment to the applicant
2Within 120 days, the respondent ([MR BRIDGES]) must pay to the applicant ([MS JOSLIN]) the sum of $37,950 ("the Payment").
3If the respondent fails or refuses to pay whole of the Payment to the applicant within the time specified in para 1 above, then the respondent must pay interest on the amount outstanding at the rate specified in or in accordance with the Family Law Rules 2004 (Cmth) – such interest to be calculated from the expiration of 120 days from the date of these orders to the date of actual payment.
Other property orders
4All the right, title and interest the applicant may have, if any, in the following assets and property vest in the respondent, namely:
(a)[Business A];
(b)[Business B];
(c)[Property A];
(d)all vehicles registered in the respondent’s name;
(e)all trailers in the power, possession and control of the respondent;
(f)personal effects and jewellery in the power, possession and control of the respondent;
(g)furniture and chattels, tools and equipment in the power, possession and control of the respondent;
(h)any shares held in the sole name of the respondent;
(i)any moneys standing to the sole credit of the respondent in any bank, credit union, building society or other financial institution; and
(j)any entitlements of the respondent arising from his membership of a superannuation fund.
5All the right, title and interest the respondent may have, if any, in the following assets and property vest in the applicant, namely:
(a)all Vehicles registered in the applicant’s name;
(b)the trailer in the power, possession and control of the applicant;
(c)[Suburb S Property];
(d)personal effects and jewellery in the power, possession and control of the applicant;
(e)furniture and chattels, tools and equipment in the power, possession and control of the applicant;
(f)any shares held in the sole name of the applicant;
(g)any moneys standing to the sole credit of the applicant in any bank, credit union, building society or other financial institution; and
(h)any entitlements of the applicant arising from her membership of a superannuation fund.
6Unless otherwise specified in these Orders and except for the purpose of enforcing these 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)insurance policies remain the sole property of the beneficiaries named therein.
(c)each party be solely entitled to the exclusion of the other to any money standing to the credit of such party in his/her name in any accounts with any bank or other financial institution;
(d)each party forego any claims they may have to any superannuation benefits belonging to or earned by the other; and
(e)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.
7Each party retain sole liability for their sole debt to the exclusion of the other party, including any debit card, visa card, master card, overdraft or loan accounts
Costs
8The applicant have leave to apply for costs in the following manner:
(a)In the event that the applicant proposes to seek costs from the respondent, the applicant must – within 28 days – file and serve a minute of orders sought as to costs, together with any written submissions that the applicant wishes to make ("costs application").
(b)If –
(i)a costs application is made; and
(ii)the respondent wishes to oppose the costs application,
the respondent must – within 28 days of service on him of the costs application – file and serve a minute of orders sought as to costs together with any written submissions that the respondent wishes to make ("costs response").
(c)The written submissions forming part of the costs application and the costs response must not exceed a maximum of 10 pages in each case.
(d)In the event that either party seeks to make oral submissions with respect to costs, that party must – within 14 days of service of the costs response on the applicant – write to the Court requesting that the matter be listed for a special appointment and setting out:
(i)the available dates for the parties to appear; and
(ii)the likely length of the special appointment.
(e)Prior to writing to the Court to request the said special appointment, the parties must confer with respect to availability and the likely length of the said special appointment.
(f)In the event that neither party seeks to make oral submissions with respect to costs, or in the event that the respondent elects not to file a costs response, any costs application be thereafter determined on the papers.
I certify that the preceding [144] paragraphs are a true copy of the reasons for
judgment delivered by this Honourable Court
Associate
5 January 2016
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