Kasiopoulos and Garapiperis
[2010] FamCA 39
•29 January 2010
FAMILY COURT OF AUSTRALIA
| KASIOPOULOS & GARAPIPERIS | [2010] FamCA 39 |
| FAMILY LAW – PROPERTY – Settlement in relation to marriage |
| Family Law Act 1975 (Cth) ss 75(2), 75(2)(j), 75(2)(k), 79 |
| Lee Steere and Lee Steere (1985) FLC 91-626 Ferraro and Ferraro (1993) FLC 92-335 Hickey and Hickey (2003) FLC 93-143; 30 Fam LR 355 Coghlan and Coghlan (2005) FLC 93-220; 32 Fam LR 414 Clauson and Clauson (1995) FLC 92-595; 18 Fam LR 693 Chorn & Hopkins (2004) FLC 93-204 |
| APPLICANT: | Mr Kasiopoulos |
| RESPONDENT: | Ms Garapiperis |
| FILE NUMBER: | SYC | 6432 | of | 2008 |
| DATE DELIVERED: | 29 January 2010 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Johnston JR |
| HEARING DATE: | 29 & 30 October 2009 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Fermanis |
| SOLICITOR FOR THE APPLICANT: | Hancock Alldis & Roskov |
| COUNSEL FOR THE RESPONDENT: | Mr Millar |
| SOLICITOR FOR THE RESPONDENT: | Vizzone Ruggero & Associates |
Orders
That within 42 days the wife shall pay to the husband the sum of $89 077 and discharge the mortgage on the former matrimonial home known as B property being the property in Folio Identifier ….
That upon compliance by the wife with the above order the husband shall do all things and sign all documents necessary to transfer to the wife his interest in the said home.
That in the event that the wife fails to comply with order 1 above both parties shall forthwith do all things and sign all documents necessary to place the said home on the market for sale and to sell it at the best price reasonably able to be obtained.
That upon the sale of the said home the proceeds of sale shall be paid as follows:
(a) To pay agent’s commission and costs of sale including legal costs
(b) To discharge the mortgage and
(c)To pay 88.09 percent of the balance to the wife and the balance to the husband.
That pursuant to s 79 of the Family Law Act 1975 the husband and wife are declared the sole owners respectively of all other property in their possession and / or control including superannuation entitlements.
That in the event that either party refuses or neglects to sign any document required to give effect to these orders the Registrars of this Court are appointed pursuant to s 106A of the Act to sign such document in the name of such party and to do all things necessary to give validity to the operation of such document.
That both parties have leave to re-list these proceedings on 7 days notice in relation to the implementation of these orders.
That all exhibits are released.
That the above orders not commence operation until 16 February 2010.
That both parties have leave to re-list these proceedings for further submissions in relation to the form of the orders only at any time until 16 February 2010.
IT IS NOTED that publication of this judgment under the pseudonym Kasiopoulos & Garapiperis is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYC 6432 of 2008
| MR KASIOPOULOS |
Applicant
And
| MS GARAPIPERIS |
Respondent
REASONS FOR JUDGMENT
Introduction and applications
These are defended property proceedings. The parties in the proceedings are Mr Kasiopoulos and Ms Garapiperis. For convenience I shall refer to them as “the husband” and “the wife” respectively.
The husband seeks orders to the following effect:
·That the wife transfer to him her interest in the former matrimonial home at B.
·That contemporaneously with such transfer the husband pay to the wife the sum of $380 000.
·That simultaneously with the above the husband discharge all mortgages and encumbrances on title and indemnify the wife in relation to all outgoings in respect of the said home.
·That otherwise each party be solely entitled to all other property and superannuation in their possession and / or control respectively.
·An enforcement order.
On the other hand the wife seeks orders to the following effect:
·That the husband transfer his interest in the former matrimonial home to the wife and discharge the mortgage thereon.
·That upon compliance with the above order the wife pay to the husband $23 034.
·That otherwise each party be declared to be the owner of all other property and superannuation in their possession and / or control respectively.
·An enforcement order.
·That the husband pay the wife’s costs of the proceedings.
Background
The wife was born in 1965 and she is therefore 44 years of age. The husband was born in 1966 and he is therefore 43 years of age. The parties commenced cohabitation upon their marriage in September 1990. They separated on 1 March 2008. There are three children of the marriage namely P born in February 1993, J born in December 1996 and C born in September 1999. The children are therefore 16 years, 13 years and 10 years of age respectively.
At the commencement of their marriage the husband’s property consisted of his interest in the parties’ property at H and an old motor vehicle. The husband was a few months short of completing his studies for a degree in engineering. He was working part time at T Company.
At this time the wife’s property consisted of her interest in the parties’ H property. The wife was working as a payroll officer.
The H property had been purchased by the parties in 1988 in contemplation of marriage. The purchase price was $135 000. Each of the parties contributed $30 000 from their savings respectively and the husband contributed a further $10 000 from monies deposited to his savings account by his father. The balance of $65 000 was funded by a loan from the St George Bank Limited. In mid 1989 this loan was repaid by an interest free loan of $65 000 from the husband’s father.
The property was rented out from the time of its purchase to the time of the parties’ marriage. But the rent was insufficient to cover the cost of the mortgage and strata levies. The shortfall was paid largely from monies earned by the wife because the husband was a student at the time. The husband also undertook part time work initially as a waiter and from December 1989 with T Company. He also had a part time job as a cleaner.
In November 1990 the husband completed his studies for his engineering degree. In January 1991 he commenced full time work at T Company as a graduate engineer. In February 1991 the husband commenced studying part time for a master degree. The husband completed his study for this degree in December 1992.
In January 1993 the husband commenced working for G Company as a supervisor.
As indicated above, the parties’ first child P was born in February 1993. The wife took maternity leave for one year.
By March 1993 the loan from the husband’s father had been repaid.
In early 1994 the wife commenced working part time with J Company.
In approximately mid 1994 the parties sold their H property for $165 000 and purchased the property at B for $248 000. This purchase was funded from the net proceeds of sale of H property, savings of $20 000 and a loan on mortgage of $75 000 from the ANZ Bank Limited.
In December 1994 the husband commenced working for D Company as a manager.
For a few months during 1995, the wife worked a second job on Tuesday evenings. During this period the wife commenced working part time with another organisation.
In approximately mid 1995 the husband’s father made an interest free loan to the parties of $40 000. This enabled them to reduce the outstanding balance on their mortgage by this amount.
In 1996 the parties undertook some modest renovations to their B home. The work took approximately 2 months during which period they lived with the husband’s parents.
In mid 1996 the husband commenced study for a Certificate III course at TAFE. He completed this course in 12 months.
As indicated above, the parties’ second child J was born in December 1996. The wife took 3 months maternity leave returning to work in February 1997.
In March 1997 the husband commenced working for F Company Pty Limited as an engineer.
Sadly the wife’s father died in 1998. The wife received $4000 from his estate.
In early 1999 the parties decided to renovate their home. They borrowed $240 000 from the ANZ Bank. The renovations involved substantial work including adding an upper level to the property. The parties and children resided with the husband’s parents for 6 months to enable the work to be completed.
As indicated above, the parties’ third child C was born in September 1999. Again the wife took 3 months maternity leave returning to work in December 1999. A couple of days prior to C’s birth the parties and children moved into their new home.
In early 2000 the parties borrowed a further $150 000 from the ANZ Bank as an investment loan. This money was used to fund the purchase of shares.
In approximately August 2000 the husband was promoted to Manager at F Pty Limited. From this time he undertook regular travel overseas for business purposes.
In August 2000 the wife accompanied the husband on an overseas business trip for 2 weeks.
In January 2002 the husband commenced studying for a Master of Business Administration.
In March 2003 the husband was promoted to a Sales and Marketing Manager.
In June 2005 the husband completed his Master of Business Administration and was promoted to Managing Director at F Pty Limited.
In approximately September 2005 the parties had a 3 week holiday in Europe.
In late 2005 there was an argument between the parties about their financial management. The wife had opened a personal credit card account and the husband was unhappy about this. He closed their joint account and joint credit card facility.
In January 2006 the parties and children went on a family holiday to Queensland with the husband’s brother’s family.
In January 2007 they went on a family holiday to Fiji for 2 weeks again with the husband’s brother’s family. Upon their return the wife commenced a course at TAFE. But she only completed 2 terms of the course.
In late 2007 the parties repaid the husband’s father $20 000. At his direction they also paid $5000 to the husband’s brother. This left $15 000 owing to the husband’s father. But the husband’s father forgave this debt.
By this time the parties’ marriage was in serious difficulty. They had paid for a holiday to the United States of America to take the children to Disneyland. So they went ahead with the holiday in January 2008.
As indicated above, the parties separated on 1 March 2008.
In March the wife drew down $13 000 on the line of credit and transferred this to her account. The wife said that she did this following the husband having received a bonus in excess of $26 000. I shall refer to this again below.
On 16 May 2008 the husband moved from the home.
In August 2008 the husband sold IAG and Resmed shares for $7950 and $17149 respectively and used the proceeds to pay loan payments. At approximately this time the husband attended at the former matrimonial home and removed approximately half the furniture.
On 26 May 2009 the parties had consent orders made by this Court in relation to parenting. The orders provide to the effect that P live with the wife 5 nights a fortnight and with the husband the remaining time and that J and C live with the wife 9 nights a fortnight and live with their father for the remaining time. Mid term and Christmas school holidays are to be shared equally by the parties.
The Applicable Law
Sub-section 79(1) of the Act provides that in property settlement proceedings, the Court may make such order as it considers appropriate.
Sub-section 79(2) provides that the Court shall not make an order under the above sub-section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
There is a long-standing preferred approach to the determination of an application brought pursuant to the provisions of s 79. This involves four inter-related steps. Firstly, the Court should make findings about the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing. Secondly, the Court should identify and assess the contributions of the parties within the meaning of ss 79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Thirdly, the Court should identify and assess the relevant matters referred to in ss 79(4)(d), (e), (f) and (g), including, because of s 79(4)(e), the matters referred to in s 75(2) 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 at step two. Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case.
This approach has been confirmed in numerous cases in this Court including for example Lee Steere and Lee Steere (1985) FLC 91-626; Ferraro and Ferraro (1993) FLC 92-335; Hickey and Hickey (2003) FLC 93-143; 30 Fam LR 355; Coghlan and Coghlan (2005) FLC 93-220; 32 Fam LR 414 and Clauson and Clauson (1995) FLC 92-595; 18 Fam LR 693.
Property available for division
To their credit the parties were able to agree on most of the items of property and superannuation available for division between them. But there was issue between them in relation to a number of items as follows.
The first issue is whether the amount of $46 555 paid by the husband to his solicitors should be added back to the pool of available property.
Learned counsel for the husband referred to the decision of the Full Court of this Court in the case of Chorn & Hopkins (2004) FLC 93-204. The Full Court was considering how the Court should treat the payment by a party of their legal costs prior to trial. The case involved considerable discussion about various circumstances in which the Court has or has not added back paid legal fees. It was submitted that the Court would be more likely to add back paid legal fees to the pool of available property in circumstances where the legal fees had been paid from funds which were available at the time of separation. It was further submitted that the Court should not add back the legal fees paid by the husband in the present case because they were paid from monies which the husband earned after separation.
On the other hand learned counsel for the wife drew attention to paragraphs 58 to 60 of the Full Court’s judgment in Chorn & Hopkins (above). Paragraph 58 is as follows:
If funds used to pay legal fees have been generated by a party post-separation from his or her own endeavours or received in his or her own right (for example, by way of gift or inheritance), they would generally not be added back as a notional asset; nor would any borrowing undertaken by a party post separation to pay legal fees to be taken into account as a liability in the calculation of the net property of the parties.
Learned counsel for the wife submitted that he has never experienced a Judge to apply such an approach, his experience having been that the Court takes the general view that whether legal costs should be added back is a matter for the exercise of discretion upon the facts of the particular case.
I must say, with respect to learned counsel for the wife, my understanding of the discussion in Chorn & Hopkins (above) and the cases referred to therein leads me to the view that whether to add the costs to the pool of available property is ultimately a matter for the Court’s discretion.
In the present case the circumstances of the parties following separation were very different. The husband continued to earn income at a very high level certainly compared to the rate of earning of the wife. This enabled him access to a level of funds which has enabled him to enjoy a level of discretionary expenditure including entertainment at quite expensive restaurants and travel which is way beyond that which the wife has been able to enjoy. Had the husband not spent the money on legal fees then it is possible that those funds which would have been available to form part of the pool of available property. In these circumstances, in my view, the appropriate course is to add back the $46 555 to the pool of property available for division between the parties.
The wife has also paid legal fees but in a much lesser amount of $8048. It was submitted on behalf of the wife that this amount ought not be added back to the pool of available property. This was because it was submitted that the wife had to borrow the funds to pay this amount. It is the case that these costs were paid by the wife debiting various amounts comprising this total to her credit cards. Some of the money debited appears to have been repaid. But there is still money owing on her credit cards. I do not propose to adopt a different approach in relation to this matter than that which I have brought in my consideration of how to deal with the husband’s legal fees paid. That is that I shall add the wife’s legal fees paid back into the pool of available property. In my view this must be the case because the wife has been able to repay some of her credit card debt in this respect and so far as the remaining balance of the credit card liability is concerned, this will be taken into account.
The next issue was whether the sale of the IAG shares and the Resmed shares by the husband for $7950 and $17 149 respectively ought to be added back to the pool of available property. It was submitted by the wife that in all the circumstances it was unreasonable for the husband to in effect cash up property and then apply it to repayment of interest on the line of credit which had been raised for the purposes of purchasing shares and other property. It was submitted that when one considers that the husband has had access to his substantial income it was unnecessary for him to convert assets to cash and that he should have been able to meet the interest payments without doing so. On the other hand it was submitted on behalf of the husband that it was not unreasonable for him to sell the shares for the purpose of meeting the interest payments.
I must say that given the level of income and other benefits which the husband has enjoyed, I am unpersuaded that he did not have the resources to meet the ongoing costs of paying the interest. In these circumstances, in my view, it is appropriate for these monies to be added back to the pool of available property.
As indicated above, in approximately March 2008 the wife drew down $13 000 from the mortgage account. It was submitted on behalf of the husband that this amount should be added back to the pool of available property. The wife spent the major part of these funds in the purchase of furniture including furniture for the children. The sum of $1289 was spent on maintaining the swimming pool. In excess of $500 was spent on servicing and replacing locks and an amount of $3100 was spent on living expenses.
When one takes a broad view of the standard of living of the parties following their separation, it is clear that the husband has been able to meet his living costs and enjoy a standard of living which has been higher than that enjoyed by the wife. On the other hand, that broad picture shows that the wife has struggled to pay her living expenses and those of the children and that she has had to borrow money from her mother and has still been in debt. In these circumstances, in my view, there is no case for adding back this $13 000 to the pool of available property.
It was submitted on behalf of the husband that the sum of $5000 which the wife drew down from the investment loan account should be added back to the pool of available property. But the wife said that she had drawn this money down in cash and had it at home for the purpose of being able to fund the purchase of furniture for the children. The wife said that the husband subsequently entered the home, found the cash and removed it. I accept this. In these circumstances, in my view, there is no basis for the sum of $5000 to be added back to the pool of available property.
The next issue was in relation to the future taxation liability for which the husband will be liable following the sale of the Wabtech shares. It was submitted that the liability would be in the amount of $188 184. But it was submitted on behalf of the wife that the Court should bear in mind that this tax liability will not be payable by the husband until next financial year. I am satisfied that this liability will have to be paid and therefore it should be included in the list of liabilities.
At the commencement of the proceedings there was an issue about whether the amount of $10 000 is owing by the wife to her mother. There was an affidavit filed by the wife’s mother in relation to this matter but that affidavit was subsequently withdrawn by the wife. My understanding is that the husband conceded that the wife owes her mother $10 000. But even if I am wrong in my understanding about this matter, I accept that these monies are owing to the wife’s mother and should be repaid. Accordingly, I propose to include this amount in the list of liabilities.
The only remaining issue in relation to balance sheet matters was that it was submitted on behalf of the wife that the Court should attribute a value of $30 154 in respect of long service leave entitlements of the husband. It was common ground that the rules of the husband’s employer prevented the husband from converting his long service leave entitlements into a cash amount during the course of his employment. It is the case, however, that at termination of his employment, any entitlements to long service leave at that time could be paid out in cash. There is no evidence to the effect that the husband is about to resign from his employment so that, in my view, there can be no question that the long service entitlements are worth $30 154 to the husband at the present time. In these circumstances, in my view, it would not be appropriate to attribute as a financial resource of the husband long service leave entitlements in any particular amount. Having said this, I propose to take this matter into account pursuant to s 75(2).
On this basis I find the property which is available for division between the parties to be as follows:-
Assets
$
1. Former matrimonial home at B
775,000
2. Husband’s furniture
15,000
3. Husband’s investments in Australian shares
179,001
4. Husband’s ANZ Bank account
110,999
5. Husband’s sale of IAG shares (add back)
7,950
6. Husband’s sale of Resmed shares (add back)
17,149
7. Husband’s legal fees paid (add back)
46,555
8. Husband’s AMP superannuation
173,407
9. Wife’s furniture
15,000
10. Wife’s bank accounts
3,361
11. Wife’s MLC Master Key unit trust
22,569
12. Wife’s shares in NIB Health Insurance
960
13. Wife’s shares in OMIP
16,153
14. Wife’s Nissan Pulsar motor vehicle
10,000
15. Wife’s legal fees paid (add back)
8,048
16. Wife’s MLC Master Key superannuation
30,911
_____________
$1,432,063
The liabilities are as follows:-
$
1. Mortgage on former matrimonial home
27,079
2. Husband’s credit cards
416
3. Husband’s taxation liability for Wabtech shares
188,184
4. Husband’s tax liability for interest earned
166
5. Wife’s credit cards
5,226
6. Wife’s liability to her mother
10,000
___________
$231,071
Surplus
$1,200,992
Contributions
Each of the parties has made financial contributions. I have referred in general terms to their respective work histories. Apart from the first couple of months following the parties’ marriage when the husband was finishing his engineering studies, the husband has had continuous full time employment. Apart from periods of maternity leave taken by the wife around the times of the births of each of the children, the wife has worked mainly part time. And she paid for the wedding and honeymoon from her pre-marriage savings.
The overwhelming financial contributions have been by the husband because he has been the major breadwinner.
On the other hand, the wife has been the children’s primary parent. So she has not had anything like the opportunity enjoyed by the husband to earn income. This is how the parties arranged their responsibilities. So the wife has made the overwhelming contributions to the welfare of the family and as homemaker and parent. This is not to suggest that the husband has not made a significant contribution as home maker and parent. Clearly he has done this.
In addition, the husband demolished the kitchen at H, removed the old carpet and painted the walls and ceilings. He also assisted with the initial renovation of the parties’ B home in 1996 by removing cement render from the walls, removing old carpet, skirting boards, architraves and doors, and painting walls, ceilings and timberwork. The wife also assisted with some of this work. In 1999, the husband assisted with the major renovation of the B property by undertaking all the painting work assisted by his father, by doing labouring work on the weekends, by demolishing the front fence and digging footings for the new fence, by laying new grass, by installing insulation and by demolishing the kitchen and cupboards. The wife also undertook the design of colour schemes and the selection of materials, fittings and appliances for the project.
Other contributions include payment by the wife to meet the shortfall between the rent received on the H property and its outgoings prior to the parties’ marriage. Noted also are the contributions by the husband’s father in making interest free loans to the parties and his gift of $15 000 plus the IAG shares as well as the wife’s admittedly very modest inheritance.
Having said this, the parties agree that their contributions overall have been equal up to the time of separation. It is only in relation to the period since separation that there is an issue about contributions. This is that it is submitted on behalf of the husband that his contributions after separation have been much greater than those of the wife. This is submitted to be on the basis that the husband has earned much more income than the wife since separation, that he has made a high level of contributions to his superannuation interest since separation, because he has acquired significant shares since separation and because the wife has had the occupancy of the former matrimonial home since separation.
I must say that I am not persuaded by this submission. The parties have continued to make contributions following their separation in broadly the same manner that they did prior to separation. In my view, simply to accept that one type of contributions, namely the financial contributions by the financially stronger party, should assume particular significance as against all other relevant contributions, would be quite unfair to the wife and not permit a just and equitable outcome as required by s 79(2) of the Act. And, as was submitted by learned counsel for the wife, the post separation contributions should be viewed in the context that they were made during a period of approximately 18 months in an overall relevant period of approximately 30 years, the parties having purchased their first property together now more than 31 years ago.
In my view the parties’ contributions overall to the time of the hearing have been equal.
s 75(2) matters
The husband is 43 years of age and he is in good health. His income consists of his salary of $3923 per week and a car allowance of $621 per week. In addition he has been in receipt of bonuses to his salary the most recent being approximately $121 000 received in February 2009. He also has superannuation benefits and is eligible to receive employer performance units.
The husband has a Bachelor of Engineering degree, a Master of Engineering degree, a Master of Business Administration and he completed the Marketing Certificate III course at TAFE as I have said. These are high level tertiary qualifications.
On the other hand, the wife has an accountancy diploma but she is not a qualified accountant. Her income is $1264 per fortnight which she earns from her part-time position with a consulting firm. She works 25 hours per week to enable her to otherwise attend to the children’s needs. The wife is also in good health.
Each of the parties has responsibility for caring for their children in accordance with the orders referred to above. There is not really much between them in this regard because, at least in broad terms, they enjoy responsibility for the care of their children almost equally. Given the ages of the children and the pattern to date, it might be the case that the wife will ultimately have to accept more responsibility in this regard than the husband. But neither counsel makes a strong submission for parenting responsibilities being a significant s 75(2) matter in this case.
The husband is paying child support in the amount of $15 000 per year for the three children. He also pays their school fees of approximately $6000 per year as well as some other fairly modest educational expenses.
The husband resides with his de facto spouse Ms N and has done so since May 2008. Ms N is employed as a Business Manager. Her annual salary is $80 000. Ms N and the husband anticipate the birth of their child in early March 2010. Ms N proposes to take a year off work following the child’s birth and then perhaps she will work part-time. The financial circumstances relating to the cohabitation of the husband and Ms N are that the husband pays the rent and utilities and they share household expenses.
The husband has some financial resources in the form of more than 750 000 frequent flyer points with Qantas and he has long service leave credits as I have said.
In my view, the most relevant s 75(2) matter is the vast difference between the parties’ respective capacities to earn income. In my view, sub-sections 75(2)(j) and (k) of the Act are very relevant in this case. Sub-section 75(2)(j) requires the Court to take into account the extent to which a party has contributed to the income and earning capacity of the other party. Sub-section 75(2)(k) requires the Court to take account of the duration of the marriage and the extent to which it has affected the earning capacity of a party.
There is no question that the wife has contributed to the husband having been able to have the time and support to undertake post-graduate study with the consequence that he has attained a high level of tertiary qualifications. This has been achieved at least in part due to support the wife has given to the husband and particularly the fact that she has undertaken the major responsibility in caring for the parties’ children. This has also enabled the husband to invest long hours in his employment and to spend significant amounts of time on business overseas.
The wife’s capacity for earning income has been affected by the marriage. Because the parties arranged their responsibilities so that the wife was the primary parent for the children, this has had the consequence that her opportunity for employment has been limited to part-time employment. As was submitted by learned counsel for the wife, she and the husband started their marriage in a similar income-earning position. But 30 years later their respective income earning capacities are in marked contrast. The husband has a very high income-earning capacity and the wife has a relatively weak one. The husband is able to enjoy a high standard of living. He would be able to borrow a substantial amount and be able to service a substantial mortgage. He is able to accumulate substantial superannuation including by salary sacrifice. He will be able to generate wealth in other ways. But the wife will not have an income which will permit such advantages.
These matters are to be acknowledged and taken into account in a manner which will reflect just and equitable orders.
It was submitted on behalf of the husband that any adjustment under s 75(2) should be very modest. On the other hand, it was submitted on behalf of the wife that to properly reflect these significant differences between the parties there should be a set-off of available property of 22.5 percent in favour of the wife.
I accept that clearly there should be a set-off of property in favour of the wife. But in my view 22.5 percent is too high, and too high by a considerable margin. In my view the appropriate set-off is 12.5 percent.
Conclusion
The wife is to have 62.5 percent of the available property. This is property with a value of $750 620.
The wife has the following property:-
$
1. Furniture
15,000
2. Bank accounts
3,361
3. MLC Master Key unit trust
22,569
4. Shares in NIB Health Insurance
960
5. Shares in OMIP
16,153
6. Nissan Pulsar motor vehicle
10,000
7. Legal fees paid (add back)
8,048
8. MLC Master Key superannuation
30,911
__________
$107,002
But the wife has the following liabilities:-
$
1. Credit cards
5,226
2. Liability to her mother
10,000
_________
$15,226
Accordingly, the wife has a surplus of property over liabilities of $91 776.
To achieve property with a value of $750 620 the wife will require further property with a value of $658 844 ($750 620 - $91 776 = $658 844).
The wife wishes to retain the former matrimonial home for her use. The home has a value of $775 000 but a mortgage of $27 079. So the equity is $747 921 ($775 000 - $27079 = $747 921). To retain the home the wife would have to pay the husband the amount of $89 077 ($747 921 - $658 844 = $89 077).
On the other hand, the husband is to have 37.5 percent of the available property. This is property with a value of $450 372. The husband has the following property:-
$
1. Furniture
15,000
2. Australian shares
179,001
3. ANZ Bank account
110,999
4. Sale of IAG shares (add back)
7,950
5. Sale of Resmed shares (add back)
17,149
6. Legal fees paid (add back)
46,555
7. AMP superannuation
173,407
_____________
$550,061
But the husband also has the following liabilities:-
$
1. Credit cards
416
2. Taxation liability for Wabtech shares
188,184
3. Taxation liability for interest earned
166
___________
$188,766
Accordingly, the husband has surplus property compared with liabilities of $361 295. To achieve property with a value of $450 372 the husband requires additional property with a value of $89 077 ($450 372 - $361 295 = $89 077). If the wife paid him this amount the husband would achieve property with a value of $450 372.
Fourth step
The wife wishes to retain the former matrimonial home. To do this she will need to pay the husband the sum of $89 077 and discharge the mortgage which is approximately $27 079. This would require the wife to borrow a modest amount. The wife also has her liabilities and she still has some legal fees to pay. She might need to increase her hours of employment to enable her to obtain the income required to service such a loan. The wife said that she does not wish to do this because of her responsibilities to the children. But the children are of sufficient ages to permit the wife to make some arrangement for at least part of their supervision to be delegated by the wife to someone appropriately qualified to undertake such a responsibility.
If the wife decides not to go into some modest debt, the former matrimonial home will have to be sold. The net proceeds of sale would be paid in the proportions 88.09 percent thereof to the wife and the balance to the husband (the wife’s entitlement of $658 844 is 88.09 percent of the equity of $747 921). From the net proceeds of sale there would be sufficient funds available to the wife to enable her to purchase another home for herself and the children.
On the other hand, the husband will have his furniture, shares, savings and superannuation. These have a total value of $478 407. But he also has the liabilities referred to above, the taxation liability for the Wabtech shares being significant at $188 184, although this will not have to be paid in the immediate future.
He has sufficient funds to be able to pay the deposit on a home and he has the financial capacity to be able to service a significant mortgage.
The orders I propose to make will not affect the earning capacity of either party.
I certify that the preceding ninety-eight (98) paragraphs are a true copy of the Reasons for Judgment of the Judicial Registrar W P Johnston.
Associate:
Date: 29 January 2010
Key Legal Topics
Areas of Law
-
Family Law
-
Property Law
Legal Concepts
-
Remedies
-
Jurisdiction
-
Costs
-
Injunction
0
1