Kapanadze & Kapanadze
[2024] FedCFamC1F 520
•6 August 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Kapanadze & Kapanadze [2024] FedCFamC1F 520
File number(s): SYC 7646 of 2020 Judgment of: JARRETT J Date of judgment: 6 August 2024 Catchwords: FAMILY LAW – PROPERTY – Where applicant had far greater initial contributions – Where applicant made significantly greater financial contributions throughout the relationship and post-separation – Where respondent made majority of parenting contributions – Where respondent’s family provided assistance – Contributions assessed 75 per cent in favour of applicant – Where applicant has greater income earning capacity – Where source of applicant’s legal fees unexplained – 7.5 per cent adjustment made in favour of respondent Legislation: Family Law Act 1975 (Cth) s 79(4) Division: Division 1 First Instance Number of paragraphs: 109 Date of hearing: 8 – 11 July 2024 Place: Sydney Counsel for the Applicant: Ms Gillies SC with Ms Wallace Solicitors for the Applicant: Unified Lawyers Counsel for the Respondent: Mr Willoughby Solicitors for the Respondent: Conditsis Lawyers ORDERS
SYC7646 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS KAPANADZE
Applicant
AND: [MR KAPANADZE
Respondent]
ORDER MADE BY:
JARRETT J
DATE OF ORDER:
6 AUGUST 2024
THE COURT ORDERS THAT:
1.Within sixty (60) days of the date of these orders the applicant shall do all acts and sign all documents necessary to cause all of the applicant’s right, title and interest in the real property known as and situate at B Street, Suburb C in the State of New South Wales, to be transferred to the respondent.
2.Simultaneously with the transfer of applicant’s interest in the Suburb C property to the respondent pursuant to order 1 above the respondent shall do all acts and sign all documents necessary to cause all of the respondent’s right, title and interest in the real property known as and situate at D Street, Suburb E in the State of New South Wales, to be transferred to the applicant.
3.Simultaneously with the transfers referred to in orders 1 and 2 above,
(a)in respect of the funds in Joint ANZ Banking Group Limited One Account ending …57 the applicant and the respondent shall, in the following order of priority:
(i)cause so much of the balance in that account to be applied so as to discharge any liability secured over B Street, Suburb C, New South Wales;
(ii)cause the sum of $104,396.00 to be paid to the respondent, or at his written direction; and
(iii)cause the balance to be paid to the applicant, or at her direction.
(b)the applicant shall do all acts and sign all documents necessary to:
(i)discharge the mortgage in favour of ANZ secured over the Suburb C property; and
(ii)discharge the mortgage in favour of ANZ secured over the Suburb E property or otherwise secure the respondent’s release from that liability.
4.That each party shall sign all documents, such as discharge of mortgage authorities, necessary to facilitate the discharge of mortgages in order 3(b) above and the transfer of funds provided for in order 3(a), within seven (7) days of receipt of any such documents for signing.
THE COURT DECLARES THAT:
5.The applicant is the sole owner, to the exclusion of the respondent, of:
(a)the properties located at:
(i)F Street, Suburb G, in the State of New South Wales; and
(ii)D Street, Suburb E in the State of New South Wales;
(b)all personal property and choses in action now in her possession or control;
(c)her superannuation funds as at the date of this order.
6.The respondent is the sole owner, to the exclusion of the applicant, of:
(a)his interest in H Street, Town J in the State of New South Wales;
(b)all personal property and choses in action now in his possession or control;
(c)his superannuation funds as at the date of this order.
THE COURT FURTHER ORDERS THAT:
7.Except as otherwise provided for in these orders, all outstanding applications are dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JARRETT J:
The applicant, Ms Kapanadze, and the respondent, Mr Kapanadze had an intimate relationship that commenced in about 2010, matured into a marriage in 2014 and came to an end when they separated in 2020. Despite the time that has passed since they separated, they remain locked in dispute about how their property ought to be divided between them.
When this trial commenced it also concerned the arrangements for their two children, daughters X and Y. However, the parties reached agreement about those matters on the third day of the trial. I made the parenting orders upon which the parents agreed. By those orders, the children will live in a week about arrangement between their parents.
BACKGROUND AND SOME FINDINGS OF FACT
The applicant is 44 years of age. The respondent is 43 years of age.
Well before the parties’ relationship commenced, the applicant commenced accumulating real property. In 2001, she purchased a property at K Street, Suburb G for $222,000. She paid a $20,000 deposit and funded the balance purchase price by bank loan.
In late 2006 the applicant purchased another property at F Street, Suburb G, for $320,000. She paid a deposit of $32,000 and funded the balance by bank loan.
The parties commenced a romantic relationship in late 2009 or early 2010. The precise time does not matter. However, the relationship was neither monogamous nor committed. The applicant described it as “on and off” and the respondent seemed to agree with that description. Nonetheless, there was a level of seriousness about the relationship because the applicant became acquainted with the respondent’s parents and extended family.
In early 2011, the applicant purchased another parcel of real property at B Street, Suburb C for $333,000. The applicant paid $33,000 by way of deposit and she obtained a bank loan to fund the balance. The respondent’s evidence is that “we purchased” the Suburb C property, but on his own evidence he made no contribution to the purchase price of the property. Legal title was registered in the applicant’s name and the respondent made no claim that she held her legal title subject to a trust in his favour.
It was at about this time that the applicant had some engagement with the respondent’s parents. Mr M is the respondent’s father. He gave evidence by way of affidavit and was cross-examined. Mr M’s evidence was that before the applicant purchased the Suburb C property, he offered to help her do some work on her property at F Street. He says that he spent a substantial amount of time over a period of 6-8 weeks painting eaves, fixing gutters, installing downpipes, cleaning and fixing the facias, painting and cleaning off old paint that was on the outside of the house, cleaning the air vents around the property which had a large build-up of dirt in them and clearing out debris in the gardens and undertaking a general clean-up of the gardens.
The applicant said that Mr M did none of this work.
At this point it is necessary to say something about the witnesses in this case.
I found the applicant to be a generally helpful witness, although there were times in her evidence when she was vague and difficult to follow. The disdain between the applicant, on the one hand and the respondent and his family on the other was palpable. I think that this coloured her evidence and made her more absolute in her recollections than was really the case. For example, her claims about being the “primary carer” for the children whilst at the same time working full time and working a second job on Friday and Saturday nights did her no credit. I found her evidence about those matters generally implausible. Overall, I think there was a tendency on the part of the applicant to over emphasise and exaggerate matters that she thought assisted her case and to minimise those matters she thought damaging. She was very reluctant to give the respondent or his family any credit for anything. Having said that though, the applicant freely suggested that the applicant was a good father to the children and she was able to identify some good qualities that he bought to their parenting. Those concessions underscore the implausible nature of some of her evidence expressed in absolute terms and it contributes to my sense that much of what she said was overstated.
So too, the respondent’s evidence was often expressed in absolute terms in his affidavit of evidence-in-chief. But cross-examination demonstrated that those absolute expressions were unfortunate and did not really capture the true state of things. Cross-examination and a comparison of his evidence to other uncontroversial facts also demonstrated that the respondent had a tendency to give his evidence in a fashion designed to advance his arguments, rather than to record the facts. His evidence that “we purchased” the Suburb C property, where in truth it was only the applicant who purchased it, is but one example of that.
I found Mr M to be an interesting witness who seemed to relish his engagement with senior counsel for the applicant. In a natural and unsophisticated way, he sought to joust with her questions in a fashion which was neither particularly helpful nor effective. It was no doubt designed to be obstructive. His designs failed. Senior counsel stuck to her task in a controlled and respectful way and eventually demonstrated that Mr M’s evidence too, was likely to be exaggerated. The best examples arose from her cross-examination about the work he claimed that he did to the Suburb C property. I will come to that shortly.
But for now, I return to the claims about the work done at F Street. I do not accept the absolute evidence given by either the applicant or Mr M about this. I accept that it is likely that he did some work at the request of the applicant, but not as much as he claimed. I accept that he did some tidying up around the place and may have touched up some painting, but the lack of any real detail in his evidence about the work he performed detracts from the probative value of his more general assertions.
Mr M also gave evidence that at around the same time that the applicant spoke to him about F Street, she told him that the shower in the house located at K Street was leaking and there was water damage to a wall as a result. Mr M says that he offered to inspect the damage and he subsequently attended at the property to do so. He found the shower to be leaking and observed some damage to an adjacent wall as a result. He said that he removed the old grout and applied silicone sealant. He said that he told the applicant that this was a temporary fix and that she would need to engage a plumber to fix the problem.
For her part, the applicant denied that Mr M did “any renovations or repairs at the [K Street], [Suburb G] property”. She says that she hired a professional waterproofing company to fix the issues with the shower.
I prefer Mr M’s evidence about this. It is curious that he would know about the shower problem at all unless the applicant told him about it and it is likely that she told him about it in the context of asking him to have a look at it for her. Having regard to Mr M’s presentation in the witness box and his self-description as a “bit of a jack-of-all-trades”, I have no doubt he would have assisted with the leak, if only on a temporary basis. The applicant’s evidence that she hired a professional waterproofing company to fix the issues with the shower is consistent with Mr M’s advice that his repair was temporary and suggests that she took up his suggestion to engage a tradesman to fix the problem permanently.
There is no dispute that the respondent and his mother and father performed some work on the Suburb C property for the applicant. However, there is a significant dispute about the extent of the work they performed.
The respondent’s case is that the property was not fit for letting and he and his parents completed various renovations to return it to a state fit for a tenant. The fitness or otherwise of the property for letting is not established by any probative evidence.
The respondent says that the work undertaken by him and his parents “included replacing the balcony at the property to ensure it was safe, landscaping and repainting the property. Ripping up the flooring and replacing it. Installing a laundry area and a lot of tidying up.” He says that it took several weeks of working on the property to complete what was required. According to the respondent, the applicant paid for most of the materials but he and his parents did all the physical work to complete the “renovations”.
In cross-examination, the respondent accepted that the work done to the balcony was limited to the replacement of some rotten timber and that neither he nor his parents, replaced the balcony. He accepted that the balcony was replaced by a tradesman engaged by the applicant for that purpose. He rejected suggestions that he and his parents did not do the other work that he had specified.
Mr M’s evidence was that the applicant asked him to have a look at the condition of the property. He did so and thought that it needed a lot of work before anyone could move in. He swears that after its purchase the respondent, his wife Ms L, one of his other sons and he were involved in “all of the renovations to the property for a period of approximately 6 to 8 weeks”. He says that he and his wife “were at the property most of the time, and we would attend the property every couple of days, as we only lived 5 minutes away at the time”.
He said that:
(a)with the assistance of Ms L, he stripped the whole house and removed the carpet and old linoleum flooring, including the glue holding it down;
(b)he built and installed a new laundry because the house was quite old and did not have a dedicated laundry;
(c)he replaced part of the veranda with decking, as the original veranda was “virtually rotten in parts and the top part of the veranda needed urgent replacing for safety reasons”;
(d)he patched up any holes in the walls ready for painting;
(e)with the assistance of the respondent and Ms L, he pulled out old plants, shrubs and weeds in the front and backyard, landscaped and cleared out the garden;
(f)he cleaned out rubbish that remained in the garage in the old shed out the back which “took quite a few weeks to complete”. He says that he estimates that he filled up the tray on his “... ute half a dozen times with rubbish from the property, which I then transported to the local rubbish tip”.
Moreover, Mr M swears that the applicant was not involved in any of the renovations, save for one occasion when she assisted in the garden for approximately 10 minutes.
Ms L gave written evidence in the proceedings, but was not cross-examined. Her evidence-in-chief was that she assisted the applicant, the respondent and her husband Mr M with getting the house the ready for tenants. She said that she:
(a)removed and scraped away the old glue residue that remained on the floor after the old linoleum flooring was removed;
(b)attended the property to allow tradesmen to access the house to install built in wardrobes, air conditioning and lay new flooring;
(c)assisted the respondent and Mr M to clean the garden, including planting new plants and mulching; and
(d)general cleaning of the property.
Ms L too, says that the applicant only helped out with some mulch for 10 minutes or so on one occasion and that otherwise “I do not recall that [Ms Kapanadze] was ever at the property”. However, this evidence is inconsistent with her own earlier written evidence that she “assisted [Ms Kapanadze], [Mr Kapanadze] and [Mr M] with getting the house the ready…”.
The applicant denies that the respondent or his family undertook any work on the Suburb C property, save for “some minor repairs to the balcony”. She also accepts that Ms L came to plant some plants in the front garden “which took approximately 45-60 minutes”. She otherwise denies the claims of the respondent and his parents. More than that, she says that the linoleum flooring within the house “is original and has not been replaced”. She says that there is “also an original outside laundry which remains the only laundry in the property”. She says that the property has not been painted since it was purchased. She denies that there was rubbish removed from the property as it was in good condition “when she moved in”.
This is a difficult issue to resolve because the evidence about it is really nothing more than allegation and counter allegation. The evidential onus lays with the respondent to prove the facts that he asserts. The uncontroversial evidence, such as it is, permits of findings that the respondent’s parents did some work, consisting of replacing at least a part of the balcony or deck and planting some plants in the front garden. From these matters, however, it is possible to draw some inferences, namely:
(a)despite the applicant’s claims that she was not in a relationship with the respondent when she purchased the Suburb C property, she nonetheless had a relationship with his parents such that she could seek or accept assistance from them in respect of the property. Indeed, she deposes to having a close relationship with them at paragraph 148 of her affidavit filed on 26 September, 2023;
(b)it is likely that there was some discussion between the applicant and the respondent or his parents about doing some work to the property, otherwise the work that the applicant concedes was undertaken would not have happened; and
(c)the need for the work to the balcony must have been observed by Mr M, because the applicant says that he offered to undertake it using wood that he had “left over” (from what she does not say). This seems a little curious given that the applicant says that she was not in a relationship with the respondent at the time she purchased the property. What business would they have had at all going to the property if that was the case?
Some of the applicant’s assertions, such as the current state of the linoleum floor and the laundry are capable, one would think, of fairly easy proof. Notwithstanding that, she produced no photographs, for example, of the original linoleum still in place, or of the old original laundry.
Doing the best I can, I am satisfied that the respondent and his parents did perform some work upon the Suburb C property soon after it was purchased. I am satisfied that Mr M undertook repairs to the balcony to make it safe (something of some importance I think) and he and Ms L did some work in the garden. I think it also likely that they undertook some work to ready the house for the installation of new flooring. Whether that went beyond removing the old carpet and extended to removing the old linoleum, I cannot say. But I am satisfied that Mr M probably removed the old carpet. Beyond that, I can make no specific findings because I am not satisfied on the balance of probabilities of the other matters that they claim to have done.
In any event, this inability to be satisfied about the work claimed to have been performed by the respondent and his family is of little moment. There is no probative evidence of the value to the property, either in direct monetary terms or in terms of making it a more attractive rental proposition thereby attracting a higher rent or more reliable tenant.
The parties took a break from their relationship in mid-2011. They recommenced seeing each other in mid-2012. The applicant says that it continued to be an “on again -off again” type affair. The respondent agreed with this in cross-examination.
In about late 2014 the parties’ relationship became serious and they commenced living together in a rental property in Suburb N. Some time and energy was expended by the parties in their evidence trying to assert (on the respondent’s part) and deny (on the applicant’s part) that they were in a de facto relationship from a point earlier than late 2014. However, none of that matters because apart from the matters to which I will later refer, no question of contribution was said to arise from the bare fact of a “relationship” (de facto or otherwise) before this date.
As of late 2014 and in addition to her real property, I am satisfied that the applicant had a motor vehicle, about $20,000 in savings and superannuation of about $50,000. This was said in her affidavit in reply filed on 26 September, 2023 and her submissions to be $70,000 and the respondent’s evidence was that it was $101,062. However, the applicant’s evidence-in-chief was clearly that it was $50,000 and I so find.
The applicant was working on a full-time basis and worked casually.
For his part, the respondent owned real property at O Street, Suburb P (perhaps purchased the year before), a motor vehicle (subject to finance) and had some superannuation of, he says, $70,000. He was employed on a full-time basis at T Company earning about $80,000 per annum. He had been so employed for about 6 or so years. I accept his evidence about these matters.
Whilst there is the appearance of a dispute between the parties about the value of the Suburb P property owned by the respondent at the time they started living together, the dispute is sterile. In early 2015 the respondent sold the property. It is uncontroversial that the net sale proceeds were $70,356. The respondent swears that from these proceeds:
(a)he contributed $29,000 to the subsequent purchase of a property at D Street, Suburb E;
(b)some of the proceeds were spent on new furniture, appliances, tools and garden implements;
(c)he paid off a personal loan secured against his previous vehicle and a holiday he had taken with the applicant;
(d)he purchased an engagement ring for the applicant in the sum of approximately $5,000;
(e)he purchased wedding bands for the parties at a cost of about $2,500 for both;
(f)he applied some funds for a holiday he and the applicant took overseas in early 2015; and
(g)he applied $11,000 (according to the respondent) or $15,000 (according to the applicant) on having cosmetic surgery performed on his teeth overseas.
In cross-examination and despite his evidence-in-chief, the respondent accepted that apart from the contribution of $29,000 to an offset account for the Suburb E property, he used the proceeds of sale from his property for his own purposes. I so find.
The parties married in 2015.
In late 2015 the parties jointly purchased D Street, Suburb E for $735,000. The applicant contributed $235,000 to the purchase and the costs of sale. The source of these funds is not revealed by the evidence, but it is not suggested by the respondent that he made any contribution to them. The highest his evidence gets is that he believes “these were funds saved during our relationship”. Even if that were so, absent more evidence as to the financial arrangements between the parties, it does not establish any contribution on his part.
The balance purchase price was provided by way of mortgage finance. The respondent contributed $29,000 (from the net proceeds of sale of his Suburb P property) which was paid to the mortgage offset account established when the property was purchased. In addition to this sum, the respondent says that he contributed $400 per week to the offset account until he ceased working in mid-2016. This is uncontroversial and those payments totalled $12,400.
In mid-2016 the respondent took extended leave from his employment. The evidence does not suggest that he earned any income after he ceased work, such as paternity leave payments. He subsequently resigned his employment in late 2017 without returning from leave.
The applicant’s evidence is that the parties lived in the rental accommodation at Suburb N until mid-2014. At that time they moved to live with the respondent’s parents in their home at Suburb C. They lived there until they moved into the Suburb E property in late 2016.
I accept the applicant’s evidence that she paid $150 week board while she lived with the respondent’s parents. Although it seems that the respondent was also required to pay a similar sum, it is not clear that he paid his parents anything. That the applicant paid money to the respondent’s parents is consistent with the evidence from the respondent’s father.
The parties’ first child, X, was born in 2016. According to Ms L, the applicant worked until two weeks prior to X’s birth and presumably, continued to earn an income.
The applicant went on maternity leave when X was born. Her leave was only for about 3 weeks. She returned to work from home in sales for her pre-pregnancy employer. To accommodate this, the applicant worked from one of the rooms in the respondent’s parents’ home.
There was an unseemly contest between the applicant and the respondent in their evidence and cross-examination about who should be labelled X’s “primary carer”. The contest is misguided because what is important are the contributions made by the parties, not the labels that might be attached to them.
For what it is worth, having regard to the evidence of each of the parties, I am not satisfied that either parent was X’s “primary carer”. My assessment of the evidence is that both parents cared for X as and when they could. I do not consider that the applicant was X’s “primary carer” because the evidence shows that she was working full-time, albeit from home. That does not mean that she made no contribution as a parent or homemaker. I accept that she would breastfeed X during her working hours and that she would also care for her during some of her working hours. She would also do those things when she was not working. I also accept that the respondent would care for X while the applicant was working. He would also feed her using breast milk expressed for that purpose by the applicant. Given his greater availability because he was not working, it is likely, and I find, that the respondent provided greater amounts of care from time to time, than did the applicant. I reject the applicant’s evidence that the respondent simply played video games of watched television or went to the gym and provided her with no assistance.
Nor am I satisfied that the respondent performed all of the household tasks as he contends. He enlists the support of his mother to make out that assertion, but on her evidence, the applicant would perform some of the household tasks like cooking and cleaning, although according to the respondent’s evidence she would complain about having to do so. Performing that work and complaining about it, is not the same as not performing it at all.
It is likely, and I find, that the respondent performed the household tasks such as cooking and cleaning more than did the applicant, but it was not his sole domain. I am satisfied that the applicant, whilst being the parties’ breadwinner was also a carer for X and attended to household task from time to time.
I accept the applicant’s evidence that the parties moved into the Suburb E property in late 2016.
In late 2016 the parties purchased Motor Vehicle 1. $54,000 of the purchase price was paid by the applicant. The respondent contributed $4,000 from the trade-in of his vehicle.
In mid-2017 the applicant sold the K Street property for $545,000. Until that time it had been let and returned a rent, no doubt assisting with defraying the borrowings secured over it. It seems that by the time the property was sold, it was unencumbered. From the net proceeds of sale the applicant contributed $449,000 to the mortgage offset account for the Suburb E property. She also purchased Motor Vehicle 2 for $21,190. The balance of about $75,000 was deposited to a savings account.
X started going to childcare one day per week in the middle of 2017. The applicant wanted her to attend more often so that the respondent could work, but he refused. He does not suggest that he obtained employment on the day X was at childcare.
At some point in 2018 the respondent’s parents caused a property at H Street, Town J, to be either purchased in the joint names of their four children, including the respondent, or perhaps transferred into their names from the respondent’s parent’s names. The evidence on that point is not clear, but again, it does not matter. There is no dispute that the respondent’s 25% interest in that property should be accounted for in these proceedings.
As I have set out above, soon after X’s birth, the applicant returned to her employment. She also, from time to time, took up casual work. This work would occur on a Friday and Saturday night and the respondent would have the care of X then and the following day while the applicant slept. The parties are in dispute about the regularity of the work, but it seems to me that it must have been regular. The applicant has demonstrated a capacity to earn significant income and to deploy that income wisely to produce long-term financial gain. In cross‑examination, she credited her mother with at least some responsibility for this.
In early 2018 the applicant obtained full-time employment with Q Company in City R. This was not a work from home position. Although the applicant says that she continued undertaking the household chores and the lion’s share of the parenting responsibilities, I consider that unlikely given her full-time employment away from the home. It is likely that at this time the respondent increased his role as a parent and homemaker within the family.
At this time, X went to childcare two days per week. The respondent did not secure employment for either of those days when X was not in his care. He would go to the gymnasium.
The respondent says that from around the beginning of 2019 until around mid-2019 he did the “odd day of work” for his brother. He says that the work was infrequent and only ever on a Friday. He says nothing about the regularity of that work, how much he earned from it and what he did with his earnings. I infer from the lack of particular evidence about these things that his earnings were nominal.
In 2019 Y was born.
Between late 2019 and early 2020 the applicant was not working in her full-time employment. She returned to her casual work by at least early 2020 and maybe earlier than that. I find that she returned to Q Company in early 2020. It was put to her that she returned to work because she was overwhelmed at home trying to care for two small children. However, her answer, which I accept, was that her paid parental leave had expired and there was no income in the household. Whilst the applicant accepted that the balance of one of her bank accounts increased by $18,000 between late 2020 and early 2020, she rejected the suggestion that the parties did not need to earn income. Her evidence, which I accept, demonstrated that she was concerned to secure the family’s financial future and to have extra money “just in case”. It was put to her that there were rents being received from real estate that she owned, but there was no exploration of whether the rents covered the expenses and mortgage payments due on the rented properties.
The applicant’s evidence about the need for her to return to work is consistent with the respondent’s evidence that the applicant was “pressuring” the respondent to obtain employment. The evidence suggests that the parties had different views about their financial position. Consistent with her driven nature, the applicant, I am satisfied, was keen to provide financially for the family and not fall behind. Hence her return to her lucrative casual work and, later, her other employment. The respondent on the other hand, took the view that the parties could live off their capital and savings for a while and he did not have to return to work for financial reasons. His evidence, which I accept, was that he was not ready for the children (especially Y) to go into childcare. Both views are reasonable.
At the applicant’s urgings, however, the respondent took on some casual work from around late 2019 until early 2020. In some weeks he worked 1 or 2 days and in other weeks there was no work at all. He swears, and I accept, that he earned a total of approximately $3,500.00 in some weeks. While he was working, the applicant looked after Y. X was in childcare.
In mid-2020 X commenced attending childcare on three days per week. The respondent obtained employment as a support worker. Initially, his work was work was slow and irregular because of issues related to the COVID-19 pandemic. However, by mid-2020 his work had increased to about 27 hours per week.
In mid-2020 the applicant obtained new full-time employment with S Company. Her casual work had seemingly come to an end because of the restrictions imposed by the COVID‑19 pandemic. The work for S Company was a mixture of in-home and out of home work depending upon the status of COVID-19 restrictions at the time. X and Y commenced at childcare three days per week.
It seems that the respondent obtained employment as a support worker in mid-2020 or thereabouts. The children attended day care on Mondays, Tuesday and Fridays while the respondent worked. This changed after separation in October, 2020 when the respondent’s regular Friday client moved away from the local area.
The parties separated on a final basis in September, 2020. The respondent moved to live with his parents who lived close by. They commenced an equal time arrangement for the children.
After a few weeks, the respondent "began to withhold the Children from her”. In response she commenced these proceedings on 27 October, 2020.
Interim parenting orders were made in December, 2020 for the children to spend three nights per fortnight with the applicant and the balance with the respondent. However, the parties reached an agreement at mediation for an equal time arrangement. This arrangement, although implemented, did not last. In early March, 2021 it ceased and the children’s time with the applicant reverted to 3 nights per fortnight.
On 11 October, 2021 interim parenting orders were made that provided for the children to live with the applicant:
(a)each week from 9am Sunday until start of school/day care on Tuesday;
(b)4pm Saturday 25 December 2021 – 9am Sunday 26 December 2021;
(c)from the start of the school year in 2022:
(i)in week 1, and alternate weeks thereafter, from 9am Sunday until start of school/day care on Tuesday (8:30am if not attending);
(ii)in week 2, and alternate weeks thereafter, from 9am Sunday until commencement of school/day care on Wednesday (8:30am if not attending);
(iii)when children not with their Mother, video WhatsApp calls on Thursdays and Saturdays between 5 – 6pm.
On the same day and in respect of the parties’ competing property applications, there was an order that:
(a)the applicant pay to the respondent $150,000 as partial property settlement;
(b)the respondent have exclusive occupancy of the Suburb C property after the applicant has caused the tenants in that property to vacate;
(c)“That following the tenants vacating the [Suburb C] property and until further order the Father pay into the Mother’s nominated account the sum of $400 per week to be applied towards the mortgage, rates and insurance on the [Suburb C] property with the Father to be additionally responsible for all utilities and like expenses incurred during his occupancy of the [Suburb C] property”;
(d)the applicant have exclusive occupancy of Suburb E property and be responsible for all outgoings of the Suburb E property including but not limited to mortgage repayments, insurance, rates and utilities.
The applicant paid the respondent the sum of $150,000 by withdrawing that sum from the applicant’s mortgage account secured over the Suburb C property.
It is uncontentious that the respondent made the weekly payment of $400 required by the orders until about October, 2022 together with utilities payments. At that point, the respondent took the view that he was not responsible for all of the utility charges. His view was that he was only responsible for the usage charges, not the service provision charges. The parties fell into dispute about the matter and the applicant has made the shortfall payments ever since. Those payments have been significant. For what it is worth, the respondent’s interpretation of the relevant orders is erroneous.
ASSETS, LIABILITIES AND FINANCIAL RESOURCES
I find that the parties presently have the following assets, liabilities and financial resources:
Assets D Street, Suburb E (J) $1,400,000.00 B Street, Suburb C (A) $750,000.00 F Street, Suburb G (A) $1,150,000.00 1/4 share of H Street, Town J (R) $85,000.00 Applicant's bank accounts (A) $6,028.00 Joint bank account $346,578.00 Respondent's bank account (R) $5,745.00 Applicant's chattels (A) $5,000.00 Respondent's chattels (R) $5,000.00 Motor Vehicle 3 (A) $27,750.00 Motor Vehicle 1 $21,800.00 Subtotal $3,802,901.00 Addbacks Partial property settlement (R) $150,000.00 Applicant funds spent from account …61 (A) $150,000.00 Subtotal $300,000.00 Liabilities ANZ loan secured by mortgage over D Street, Suburb E (A) $285,876.00 Loan secured by mortgage over B Street, Suburb C (A) $158,050.00 Subtotal $443,926.00 Superannuation Respondent's superannuation $151,049.00 Applicant's superannuation $112,966.00 Subtotal $264,015.00 Subtotal of assets, addbacks and superannuation $4,366,916.00 Subtotal of liabilities $443,926.00 TOTAL $3,922,990.00
Save for the second item under the heading “Addbacks”, the parties have agreed upon the items set out above and their values. No further observations about them are necessary.
As to the disputed “addback”, the respondent contends that the applicant received an unjustified and premature distribution of the parties’ capital when, about one month after separation, she gave her mother $150,000 out of a savings account. As to this transfer, in her evidence-in-chief the applicant swore:
222.During the relationship, I assisted my parents with renovating and extending their kitchen as a gift and contributed $150,000.
This evidence was plainly wrong as she immediately, but without explanation, acknowledged when challenged about it. The gift was made about one month after separation and it was made to her mother, rather than her parents. In cross-examination no reason for the gift was given. The applicant did not call her mother to give evidence even though she accepted that her mother was available to do so. Further, the disposition of the money did not appear in her Financial Statement as a disposition of property post-separation. The applicant also said in cross-examination that her mother was lending her money to pay her legal fees and that she would have to pay those funds back. She acknowledged that the money her mother was lending her was coming from the $150,000 she had given her mother. There is nothing in her Financial Statement that might be consistent with these assertions.
I am satisfied that the transfer of the $150,000 from the applicant to her mother in October, 2020 was a premature distribution of the parties’ capital that would have otherwise been available for distribution between the parties in these proceedings. It is appropriate to include it as an “add-back”.
CONTRIBUTIONS
The applicant introduced significant assets into the parties’ relationship. Of the assets that are available for distribution, she introduced the Suburb G property, the Suburb C property, and a significant proportion of the funds used to purchase the Suburb E property (via the net proceeds of sale of her other Suburb G property). She also had her vehicle, savings of $20,000 and some superannuation of about $50,000.
The respondent had his Suburb P property which liberated net proceeds of sale of $70,356 when it was sold of which, he contributed $29,000 to the Suburb E mortgage off-set facility when it was established. He also had his motor vehicle, in which he had little equity and some superannuation.
Both parties were working at the outset of their relationship. But the direct financial contributions of the applicant exceeded those of the respondent by a good margin. The applicant applied her income and capital to the maintenance of the properties by paying the mortgages and the outgoings. She used $54,000 of her capital to purchase a motor vehicle with a contribution of $4,000 from the respondent in late 2016.
Other than his contribution to the mortgage off-set facility, the respondent’s contribution to the Suburb E property seems to be limited to the sum of $12,400 over an 8 month period. The applicant’s contribution was much greater. She initially provided $235,000, probably from savings, and a further $449,000 to the mortgage offset facility from the sale proceeds of her K Street property. She also used some of those proceeds to purchase another motor vehicle.
The evidence satisfies me that from the time after the parties commenced living together in 2016, the applicant met their living expenses. She continued to do so without contribution from the respondent even when he had periods of employment. The applicant was responsible for financial provision for the family.
As I have set out above, the parties’ parent and homemaker roles were split between them, but it is likely, and I find, that the respondent’s contribution in this regard was greater than that of the applicant’s. Neither, however, was solely responsible for caring for their children or undertaking household tasks.
Since separation, the respondent’s contribution as parent to the parties’ children have exceeded by a considerable margin, the applicant’s contributions. That they have come about, in part, by reason of the way in which the respondent withheld the children from the applicant says nothing in response to the actual care that he has given them. However, since separation, the applicant has continued to be the primary, but not the only, contributor of financial support to the family and their property. Between December 2020 – June 2021, she was solely responsible for the children’s day-care fees (including for the times they were in the respondent’s care), totalling $3,614 and she swears that until the time of trial she has paid about $75.00 per week for that service. I accept her evidence about that.
The applicant has continued to make the mortgage payments on the parties’ joint mortgage over the Suburb E property since separation. From September, 2020 to July, 2023 she has paid at least $76,363. The weekly payments are about $534.42 per week. I accept the respondent’s unchallenged evidence, however, that in November, 2019 the applicant withdrew $50,000 from the mortgage account secured over the Suburb C property (payments on that mortgage were then in advance) and then used this sum to make the mortgage payments that were due. Moreover, to the extent that the mortgage payments that have been made by the applicant since separation have been paid from the mortgage offset accounts that were funded from her contribution of the nett sale proceeds of the K Street property, it is important not to give her credit twice for those payments.
From September, 2020 to July 2023, the applicant has paid at least $38,610 towards the Suburb C property and between October, 2022 and the date of her affidavit of evidence-in-chief, the sum of $33,000 towards utilities and like expenses for that property.
The respondent has paid $400 per week since the orders of 11 October, 2021.
The parties have shared X’s school fees on 13 March 2023, totalling $1,492 per year and the applicant solely pays for the children’s sport lessons at $160 per month.
Having regard to all those matters, I consider that the parties’ contribution-based entitlements should be assess as 75% to the applicant and 25% to the respondent. The applicant was seized of significant property when the parties first met and some it remains reflected in the property now available for division between them. She has made the overwhelming contributions financially to the acquisition, conservation and improvement of the parties’ property as it presently exists. Taking account of the non-financial contributions made by the respondent to the parties’ family and the contributions made on his behalf by his own family, the assessment I have arrived at is, I consider and appropriate reflection of the parties’ efforts.
On that basis, that would mean that the applicant is entitled to $2,942,242.50 and the respondent to the balance of $980,747.50.
SECTIONS 79(4)(D), (E), (F) AND (G)
None of the orders proposed by either of the parties will have an impact upon their income earning capacity.
Since December, 2020 the applicant has paid $402 per week in child support to the respondent. She has fallen behind at times, but no suggestion of any outstanding child support liability was put to her in cross-examination. This is despite there being an assertion in correspondence from the respondent’s lawyers to her lawyers that as at 8 May, 2024 there were arrears of $5,685.72. Additionally, the applicant has met her share of the X’s school fees, although there was a time according to her evidence when the respondent had not.
The applicant presently works full-time and earns about $70,000 gross per annum. The respondent contends that she may still earn income with casual work, but there is no evidence that she does so. Her own evidence, which I accept, is that she no longer undertakes that work.
The respondent works casually as a support worker and according to his most recent financial statement, earns about $50,000 gross per annum.
The applicant has a greater earning capacity than the respondent. I take that into account.
The parties are, pursuant to the parenting orders upon which they have now agreed, equally responsible for the care of their children. The financial burden of their care will fall equally to each of them.
The applicant will retain the Suburb G property. That is an asset that has the capacity to earn her income should she choose to deploy it in that respect. The only evidence I have as to its earning capacity is that in her tax return for the year ended 30 June, 2019 the nett rent received for this property was $27,917.00. I imagine it would be much higher now.
Both the Suburb E property and the Suburb C property have the potential to be income producing assets in the hands of the party that retains them. Absent any adjustment to the contributions-based assessment, that is likely to be the applicant. She presently lives in the Suburb E property and the respondent lives in the Suburb C property.
Both parties are of similar age and each are in good health. They each have many years of productive working lives ahead of them.
Finally, the respondent argued that I should take into account that the applicant has spent about $395,000 on legal costs sourced from who-knows-where. Whilst the evidence demonstrated some significant withdrawals from the applicant’s accounts at the time of separation, the respondent did not argue for the sums expended upon legal costs to be added-back to the property pool given that:
(a)precise identification of the funds used to pay her legal costs could not be made;
(b)the applicant gave evidence that her mother was meeting her legal costs from funds that the applicant had gifted her mother (which sum forms the add-back discussed above); and
(c)given the applicant’s high income at times, some of it may have been paid from income.
I take these matters into account, although, in my view, they do not attract significant weight.
Having regard to those matters as well as the parties’ respective standards of living during their relationship ad since separation, I consider that an appropriate adjustment to the contribution‑based assessment is a further 7.5% in the respondent favour. Seven and a half per cent of the net value of the parties’ property is $294,224.25.
On that basis, the applicant will be entitled to $2,648,018.25, which I will round to $2,650,000 and the respondent the balance of $1,272,990.00.
The applicant presently resides in the Suburb E property and the respondent resides in the Suburb C property. He wishes to retain the Suburb C property. I think that is reasonable. Although it is registered in the applicant’s name and she purchased it in the circumstances I have described earlier in these reasons, leaving it in the respondent’s hands would cause less inconvenience for him and the children, who until recently have lived much of their time there. It will represent some stability for them. Moreover, the applicant has never lived in that property, gave no evidence of any particular attachment to it and it is the least valuable of the three parcels of real property at issue.
Accordingly, if the respondent retains the Suburb C property unencumbered, he will have the following assets (he presently has no liabilities):
B Street, Suburb C (A) $750,000.00 1/4 share of H Street, Town J (R) $85,000.00 Respondent's bank account (R) $5,745.00 Respondent's chattels (R) $5,000.00 Motor Vehicle 1 $21,800.00 Respondent's superannuation $151,049.00 Partial property settlement spent on legal fees (R) $150,000.00 Total $1,168,594.00
To make up his entitlement, he will require a further $104,396. The respondent should have this shortfall made up from the funds in the joint bank account. The balance in the joint bank account is sufficient to meet the mortgage liability on Suburb C and make the cash adjustment to the respondent.
ORDERS
There should be orders that require the applicant to discharge any security registered over the title to the Suburb C property. To achieve that, the funds in the joint bank account should be applied to Suburb C mortgage so that the security over that property can be released. The funds in the parties’ joint accounts can then be paid to each party in accordance with their entitlements.
I consider the orders set out at the commencement of these reasons to be just and equitable. I make orders accordingly.
I certify that the preceding one hundred and nine (109) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Jarrett. Associate:
Dated: 6 August 2024
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