Kanelos and Kanelos and Ors

This case concerned parenting and property disputes between a wife and her husband, who was a bankrupt, and involved the Trustee in Bankruptcy as a respondent. The wife sought sole parental responsibility for the parties' two children, orders for the children to live with her, and for the children to spend time with the husband as agreed in writing. She also sought orders to enable her to apply for and retain the children's passports without the husband's consent. In relation to property, the wife sought an adjustment of interests in the former matrimonial home, which was jointly owned with the husband, and where a caveat was registered. The husband had disengaged from spending time with the children, communication between the parents was difficult, and the court had concerns about the husband's capacity to provide for the children's needs.

The court was required to determine whether the presumption of equal shared parental responsibility should apply, and if not, what orders were just and equitable regarding the children's living arrangements and time spent with each parent. Furthermore, the court had to consider the impact of the husband's bankruptcy on the property settlement and determine how to adjust the parties' property interests, including the former matrimonial home, in a just and equitable manner, particularly given the husband's failure to comply with previous spousal maintenance orders and the futility of ordering him to transfer other properties. The court also needed to address the wife's application concerning the children's passports and international travel.

In its reasoning, the court found that the presumption of equal shared parental responsibility should not be applied due to the husband's disengagement and concerns about his capacity to meet the children's needs. The court determined that it was just and equitable to make orders altering the parties' property interests, considering their joint contributions to the household and the need to sever their financial relationship. The court applied principles from cases such as *Stanford* and *Bevan* regarding the identification of legal and equitable interests in property proceedings. The court also considered the provisions of the *Bankruptcy Act 1966* (Cth) and the *Family Law Act 1975* (Cth) in making its property orders.

The court ordered that the wife have sole parental responsibility for the children, that the children live with her, and spend time with the husband as agreed in writing. The wife was permitted to apply for and retain the children's passports and travel internationally with them, subject to providing notice to the husband. In relation to property, the Trustee in Bankruptcy was ordered to transfer his interest in the former matrimonial home to the wife, with the wife indemnifying the husband and Trustee in respect of liabilities associated with that property. The wife was to retain sole ownership of other property in her name and indemnify the husband regarding certain debts, while the husband was to remain solely liable for debts in his name.