Kawada & Kawada

FAMILY COURT OF AUSTRALIA

KAWADA & KAWADA AND ORS

[2012] FamCA 273

FAMILY LAW – PROPERTY – Whether real property, a cash sum and a motor vehicle are property of the husband and the wife or either of them by way of presumption of advancement or belong to the husband’s father/parents by way of resulting trust – Whether presumption of advancement rebutted in relation to those items – Held on the evidence resulting trust applies to each item and presumption of advancement rebutted for each item – Net negative pool – Relevance of question whether husband's and wife's property and assets including their superannuation interests should be regarded as one pool or whether their superannuation interests should be regarded as a separate pool – Contribution during the course of the relationship and marriage including in relation to superannuation interests agreed to be treated as equal – Section 75(2) factors favour adjustment to wife - Just and equitable to make order under s 79

FAMILY LAW – PROPERTY – Superannuation interests - Splitting order not sought at trial but sought after trial and before judgment – No notice to trustee – Court asked to make a splitting order before procedural fairness accorded to trustee and predicated upon subsequent procedural fairness such that trustee within a reasonable time could apply to set aside splitting order – That approach refused as inconsistent with s 90MZD – Matter stood over to allow s 90MZD compliance

Evidence Act 1995 (Cth) s 138, s 140
Family Law Act 1975 (Cth) s 79, s 75(2), s 81, s 90AE, s 90MC(1), s 90MZD
Marriage Act 1961 (Cth)
Property Law Act 1974 (Qld) s 11

Australian Securities & Investments Commission v Rich (2003) FLC 93-171
Baumgartner v Baumgartner (1987) 164 CLR 137
Biltoft and Biltoft (1995) FLC 92-614
Bloch v Bloch (1981) 180 CLR 390
Briginshaw v Briginshaw (1938) 60 CLR 336
Buffrey v Buffrey [2006] NSWSC 1349
Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353
Coghlan & Coghlan (2005) FLC 93-220
Damberg v Damberg (2001) 52 NSWLR 492
Farmer and Bramley (2000) FLC 93-060
Figgins and Figgins (2002) FLC 93-122
Jones v Dunkel (1959) 101 CLR 298
Kessey and Kessey (1994) FLC 92-495
Marshal v Crutwell (1875) LR 20 Eq 328
Muschinski v Dodds (1985) 160 CLR 583
Napier v Public Trustee (Western Australia) 32 ALR 153
Norbis & Norbis (1986) 161 CLR 513
Pierce and Pierce (1999) FLC 92-844
Potter & Potter [2003] 3 NZLR 145
Robson & Robson (2003) FLC 93-145
Russell v Scott (1936) 55 CLR 440
Shephard v Cartwright (1955) AC 431

Trustee of the Property of G Lemnos, a Bankrupt & Lemnos & Anor (2009) FLC 93-394

Zyk & Zyk (1995) FLC 92-644

HAJ Ford and WA Lee, Thomson Reuters, The Law of Trusts, vol 2, (at update 80)

APPLICANT:

Ms Kawada

FIRST RESPONDENT:

Mr Kawada

SECOND RESPONDENTS:

T Kawada and M Kawada

FILE NUMBER:

BRC

9952

2009

DATE DELIVERED:

1 May 2012

PLACE DELIVERED:

Brisbane

PLACE HEARD:

Brisbane

JUDGMENT OF:

O’Reilly J

HEARING DATE:

4, 19, 20 and 21 July 2011

(Further written submissions Mr Page SC 26 July 2011 and 6 October 2011; further written submissions first respondent 12 October 2011)

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Page SC

SOLICITORS FOR THE APPLICANT:

Jones Mitchell Lawyers

THE FIRST RESPONDENT:

In person

THE SECOND RESPONDENTS:

In person via telelink in Japan

Orders

IT IS DECLARED

The property at D Court, P Queensland … registered in the name Mr Kawada (the P property) is held by him by way of a resulting trust beneficially for T Kawada and M Kawada.
The amount of AUD190,000 remitted by Mr Kawada to T Kawada in or about August 2009 belongs to T Kawada and M Kawada beneficially.
The Ford Falcon motor vehicle registered in the name Mr Kawada registered no … is held by him by way of a resulting trust beneficially for T Kawada and M Kawada.

AND IT IS ORDERED

The wife do all things and sign all documents necessary to remove caveat no … lodged against the title to the P property.
Pursuant to s 106A(1) of the Family Law Act 1975 (Cth) (the Act) a Registrar is appointed to do all acts and sign all documents necessary in the name of the wife to effect removal of the caveat.

AND IT IS FURTHER ORDERED

The applications by Ms Kawada and Mr Kawada for an order under s 79 of the Act be stood over pending the wife’s solicitors according procedural fairness to the trustee of the husband’s superannuation interest with Suncorp Easy Super and filing evidence of such including any response from the trustee.
The matter be further listed at 9.30 am on Tuesday 22 May 2012 for the making of a s 79 order in accordance with the reasons for judgment.

NOTATION:

The proposed s 79 order is attached and marked Annexure A subject to submissions on the form of the order.

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

ANNEXURE A

Section 79 order proposed to be made on 22 May 2012 subject to s 90MZD compliance.

Pursuant to s 79 of the Family law Act 1975(Cth) (the Act) the property and assets of the husband and the wife or either of them be divided as follows:

The wife have:

a.      item 3, her ring, valued at $1,960
b.      item 9, her superannuation interest with Suncorp Wealth Smart, valued at $9,527
c.      item 10, her superannuation interest with HESTA, valued at $4,628
d.      that part of item 8, the husband’s superannuation interest with Suncorp Easy Super as provided in orders 2b and 3, valued at $10,441.

TOTAL VALUE: $26,556

The husband have:

a.      item 2, cash addback, valued at $16,000
b.      item 8, his superannuation interest with Suncorp Easy Super, valued at $16,591, less the base amount for the wife of $10,441 as provided in orders 1d and 3 (E $6,150)
c.      item 11, shares in the company A Pty Ltd, valued at nil.

TOTAL VALUE $22,150

The base amount of $10,441 be allocated to the wife out of the interest of the husband member number …93 with Suncorp Easy Super.

Pursuant to s 90MT(1)(a) of the Act whenever a splittable payment becomes payable in respect of the interest held by the husband with the Suncorp Easy Super the trustee:

a. pay to the wife or her legal personal representative the amount which is calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001
d. make a corresponding reduction in the entitlement the husband would have had but for this order.

Order 4 has effect from the operative time.

The operative time for the purpose of this order is the fourth business day after the date of service of a sealed copy of the order on the trustee of Suncorp Easy Super.

Otherwise the parties are to retain all assets and financial resources in their respective name or possession.

Unless otherwise specified in this order:
a.      each party is solely entitled to the exclusion of the other to all property and assets (including choses in action) in the possession of that party as at the date of this order
b.      each party is solely entitled to the credit of any moneys in any bank accounts in his or her name
c.      each party is to forego any claim he or she may have to any superannuation benefits belonging to or earned by the other
Pursuant to s 106A(1) of the Act a Registrar is appointed to do all acts and sign all documents necessary in the name of the parties to put into effect this order.

FAMILY COURT OF AUSTRALIA AT BRISBANE

FILE NUMBER: BRC 9952 of 2009

Ms Kawada

Applicant

And

Mr Kawada

First Respondent

And

T Kawada and M Kawada
Second Respondents

REASONS FOR JUDGMENT

The parties and their applications

Ms Kawada (the wife) and Mr Kawada (the husband) each seek a just and equitable property settlement by way of order under s 79 of the Family Law Act1975 (Cth) (the Act).
T Kawada and M Kawada (the husband’s parents) seek declarations that a property at D Court, P Queensland (the P property), located in the Gold Coast region, and a Ford Falcon motor vehicle registered no … (the Ford Falcon motor vehicle) are held by the husband on trust for them, and that the sum of AUD190,000 remitted to them in Japan by the husband from Australia in August 2009, previously held in bank accounts in Australia and in New Zealand (the remitted moneys) had been held on trust for them by the husband and/or the wife prior to the remission; such that the P property, the Ford Falcon motor vehicle and the remitted moneys belong to them beneficially; alternatively, that the amount of AUD165,000 advanced by them to the husband in June 1999 to purchase the P property (including stamp duty and conveyancing costs), the amount of NZD100,000 advanced by them to the husband in February 1995 (which, after investment, grew to the AUD190,000 remitted moneys) and the amount of AUD34,093 advanced by them to the husband to purchase the Ford Falcon motor vehicle were loans by them; and consequential orders.

Relevant background facts

The wife is 43 years having been born in 1968 in the Philippines.
The husband is 46 years having been born in 1965 in Japan.
The wife and the husband met in 1991 in Japan. They married in the Philippines in May 1993. They shared an intimate relationship for about 2 years before the marriage. They separated on 20 September 2009 in Australia. The period of their relationship and marriage thus was about 18½ years.
The wife and the husband have 3 children, K born in 1992 (before the marriage) now 20 years, X born in 1993 now 18 years and L born in May 1996 now 15 years.
The husband and the wife at the time of the trial were not divorced.
The wife has repartnered with Mr G. The wife, Mr G and the 3 children live in rented premises at S, in the Gold Coast region.
The husband says he has remarried and that his wife is Ms Z, who was present in Court during the proceedings. The husband says the marriage was conducted in February 2011 by a marriage celebrant. A photograph of the event is ex 6. It is uncertain whether the marriage celebrant purported to conduct the marriage ceremony under the Marriage Act 1961 (Cth) (in which case it would appear the marriage is void, the husband being then still lawfully married to the wife) or whether some other form of civil union took place. Be that as it may, the husband regards Ms Z as his wife.
The husband and Ms Z live in the P property.
Prior to separation on 20 September 2009, the husband, the wife and the children lived in the P property as a family.
After the separation, the wife and the husband lived “under one roof” in the P property until the wife and the children vacated it on 30 December 2009.
After the marriage of the wife and the husband in the Philippines, the wife lived in the Philippines and the husband in Japan. The husband visited the wife in the Philippines, and later the wife, K and X in the Philippines, frequently.
The wife and the husband commenced to live together in April 1995, when they migrated to New Zealand. They lived there until about January 1999, when they and the then 3 children moved to and commenced to reside in Australia.
In Australia, initially the wife the husband and the children lived in rented premises.
After purchase of the P property, which occurred in early 1999, the wife the husband and the children commenced to reside in that property. They continued to do so as at separation, some 10 years later, and subsequently, as I have mentioned, “under one roof” until the wife and the children vacated it on 30 December 2009.
The wife says that she vacated the P property on 30 December 2009 by the coercion of a court order made on 22 December 2009 by Federal Magistrate Wilson. The order by Wilson FM on that date does not contain such coercion. See that order, and also the reasons for judgment Wilson FM 22 December 2009, pars 8, 9 and 11. Regardless, the result of Wilson FM’s reasons for judgment at those paragraphs is that the husband subsequently in effect evicted the wife from the P property, it being registered in his name. Certainly, he demanded that she leave, and she did so.
Presently, nothing turns on whether the coercion was the court order or a notice by the husband that she vacate the P property.
It is plain enough however that the wife did not wish to leave it but was coerced to do so in one manner or another.
After vacating the P property, the wife and the 3 children relied initially on accommodation with friends, until she was able to arrange rented premises.
As I understand the matter, the husband did not require the children to vacate the P property, only the wife. However, the children were and are attached to the wife as their primary carer and vacated the P property with her.
The children, it appears, have had little or no relationship with the husband since then, and he has provided minimal financial assistance for them, in effect about $1,200 in December 2010 via the Child Support Agency but no other support in relation to their accommodation, education, health or other costs.
At the time of the trial K was working as a part time shop assistant and X as a part time waitress, hoping to study accounting at University in 2012. K and X were then paying the wife about $50 per week for board, if they were able to do so. At the time of the trial L was in Year 10 at S High School, anticipated to be Year 11 in 2012.

Nature and value of the asset pool

The wife and the husband agreed, by the conclusion of the trial on 21 July 2011, that the potential asset pool is as represented in ex 10, a Balance Sheet, which I will set out below as the Schedule. It is not necessary in these circumstances to refer to earlier versions of the Balance Sheet, nor items in it deleted before its final agreed version represented by ex 10. On ex 10 there are hand notations by me agreed by the parties during argument, as the result of which in the Schedule I have altered the end line total.
Immediately, it will be noticed that in the Schedule there are no items relating to furniture/chattels, those being not in issue between the wife and the husband and, as I understand the matter, divided by prior agreement.
Items 1, 4 and 5 in the Schedule are marked in the “Husband’s” column with the words “Should not be included on balance sheet”.
It will be readily apparent that items 1, 4 and 5 are the subject of the claim by the husband’s parents as to beneficial ownership by them.

SCHEDULE

Ownership		Description		Wife’s value	Husband’s value
ASSETS
1	H	P property		$395,000	Should not be included on balance sheet
2	H	Savings at separation		$16,000	$16,000
3	W	Jewellery		$1,960	$1,960
Total				$412,960	$17,960
ADDBACKS
4	H	Funds remitted by husband to Japan		$190,000	Should not be included on balance sheet
5	H	Value of Ford Falcon motor vehicle		$3,650	Should not be included on balance sheet
Total				$193,650	NIL
LIABILITIES
6	H	Credit card at separation		$2,470	$2,470
7	W	Current credit cards $35,749 plus interest at 15% to July 2011 ($11,232)		$46,981	$46,981
Total				$49,451	$49,451
SUPERANNUATION
Member		Name of Fund	Type of interest	Wife’s value	Husband’s value
8	H	Suncorp Easy Super	$16,591.02	$16,591.02
9	W	Suncorp Wealth Smart	$9,527.57	$9,527.57
10	W	HESTA	$4,628.92	$4,628.92
Total				$30,747.51	$30,747.51
FINANCIAL RESOURCES
11	H	Shares in the company A Pty Ltd		NIL	NIL
Total				Net $587,906.51	($743.49)

Pool matters requiring determination

Items 1, 4 and 5

It is convenient to deal first with the 3 items in respect of which the husband’s parents claim beneficial ownership, each by way of resulting trust.
In respect of each item, Mr Page SC, for the wife, raised and relied upon the presumption of advancement as between the husband’s parents and the husband. As is understood, the presumption of advancement is a rebuttable presumption.
In respect of each of these 3 items, the evidence which I accept negates the presumption of advancement and convinces me that each of items 1, 4 and 5 is owned beneficially by the husband’s parents.
However, before going to the evidence and my reasoning for these conclusions it is necessary to refer to the principles concerning the interrelationship between two competing presumptions, on the one hand that of resulting trusts and on the other hand that of advancement.

Principles concerning the interrelationship between the competing presumptions of resulting trusts and of advancement

In Shephard v Cartwright (1955) AC 431 Viscount Simonds said at 445-6:
…[T]he law is clear that on the one hand where a man purchases shares and they are registered in the name of a stranger there is a resulting trust in favour of the purchaser; on the other hand, if they are registered in the name of a child or one to whom the purchaser then stood in loco parentis, there is no such resulting trust but a presumption of advancement. Equally it is clear that the presumption may be rebutted but should not, as Lord Eldon said, give way to slight circumstances: (citation omitted)
It must then be asked by what evidence can the presumption be rebutted, and it would, I think, be very unfortunate if any doubt were cast (as I think it has been by certain passages in the judgments under review) upon the well-settled law on this subject. It is, I think, correctly stated in substantially the same terms in every textbook that I have consulted and supported by authority extending over a long period of time. I will take, as an example, a passage from Snell’s Equity, 24^th ed., p. 153, which is as follows:
“The acts and declarations of the parties before or at the time of the purchase, or so immediately after it as to constitute a part of the transaction, are admissible in evidence either for or against the party who did the act or made the declaration… But subsequent acts and declarations are admissible as evidence only against the party who did or made them, and not in his favour.”
I do not think it necessary to review the numerous cases of high authority upon which this statement is founded. It is possible to find in some earlier judgments reference to “subsequent” events without the qualifications contained in the textbook statement: it may even be possible to wonder in some cases how in the narration of facts certain events were admitted to consideration. But the burden of authority in favour of the broad proposition as stated in the passage I have cited is overwhelming and should not be disturbed. (emphasis added)
In Russell v Scott (1936) 55 CLR 440 Dixon and Evatt JJ at 452-3 referred with approval to Sir George Jessel MR in Marshal v Crutwell (1875) LR 20 Eq 328:
He says: - “…As I understand it, the law is this: The mere circumstance that the name of a child or a wife is inserted on the occasion of a purchase of stock is not sufficient to rebut a resulting a trust in favour of the purchaser if the surrounding circumstances lead to the conclusion that a trust was intended. Although a purchase in the name of a wife or a child, if altogether unexplained, will be deemed a gift, yet you may take surrounding circumstances into consideration, so as to say that it is a trust, not a gift. So in the case of a stranger, you may take surrounding circumstances into consideration, so as to say that a purchase in his name is a gift, not a trust.” (emphasis added; footnote omitted)
Later, in Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353 Dixon CJ, McTiernan, Williams, Fullagar and Taylor JJ said at 363-4:
…We are in the presence of the familiar problem that arises whenever a person purchases and pays for property, real or personal, whatever its description may be, the legal title to which is transferred by his direction into the name of another person. If that person is a stranger, the presumption of a resulting trust arises and he holds the property on trust for the purchaser. But if the purchaser is the father of or a person in loco parentis to the legal owner, the presumption arises from the relationship of the parties that the father intended to purchase the property to advance his child and to make the child not only the legal but also the beneficial owner of the property. These presumptions were described as landmarks in the law by Eyre C.B. as far back as 1788 in the leading case of Dyer v. Dyer (1). In Sidmouth v Sidmouth (2), decided in 1840, Lord Langdale M.R. said: “The law applicable to cases of this nature is subject to so little doubt that it has not been questioned in the argument of this case. Where property is purchased by a parent in the name of his child, the purchase is prima facie to be deemed an advancement; the resulting or implied trust which arises in favour of the person who pays the purchase-money, and takes a conveyance or transfer in the name of a stranger, does not arise in the case of a purchase by a parent in the name of a child; but still the relation of parent and child is only evidence of the intention of the parent to advance the child, and that evidence may be rebutted by other evidence, manifesting an intention that the child shall take as a trustee; and in this case, as in most others of the like kind, the only question is, whether there is such other evidence. That cotemporaneous acts and even cotemporaneous declarations of the parent may amount to such evidence, has often been decided. Subsequent acts and declarations of the parent are not evidence to support the trust, although subsequent acts and declarations of the child may be so; but, generally speaking, we are to look at what was said and done at the time”. (emphasis added; footnote omitted).

In November 1980, in Napier v Public Trustee (Western Australia) 32 ALR 153 Gibbs ACJ said at 154-5:
…Where evidence has been given as to the intentions with which the parties effected the transaction, it is unlikely that the question whether or not there is a presumption of advancement will be important, or at least decisive: … For if there is a presumption, it is only prima facie, and evidence may be given to rebut it: … (authorities omitted; emphasis added).
I will make mention also of two New South Wales decisions.
In Damberg v Damberg (2001) 52 NSWLR 492 the New South Wales Court of Appeal (Spigelman CJ, Sheller JA and Heydon JA) at [42]-[45] discussed Viscount Simonds in Shephard v Cartwright that the presumption of advancement “should not … give way to slight circumstances”, and other authorities “suggesting that the standard of proof is higher than the normal civil standard”: [43]-[44]. Their Honours concluded that the standard of proof to be met in order to rebut the presumption of advancement does not call for application of the principles discussed in Briginshaw v Briginshaw (1938) 60 CLR 336. However their honours said [44]:
…But it does call for proof of a “definite intention” to retain beneficial title, not a “nebulous intention to rely upon the … relationship as a source of control over the property”: Drever v Drever [1936] ALR 446 at 450 per Dixon J (dissenting, but not on this point). (emphasis added)
Their Honours at [45] said that Viscount Simonds’s formulation (which I have set out above) “is generally taken implicitly to exclude not only subsequent declarations which are not admissions, but subsequent conduct” and said further the following [45]:
…Read by itself, Viscount Simonds’ formulation might suggest that testimony by the husband in his own favour was inadmissible, as being a subsequent declaration. However Viscount Simonds’ formulation does not exclude testimonial evidence of intention. … In general a person whose intention at an earlier time is in issue may give evidence of it, and the position is the same here, even though the weight of the evidence, coming as it does from an interested witness, must be scrutinised with care: … It follows from the proposition that the rules for admissibility of evidence tendered to rebut the presumption are simply those of the general law that any modifications effected by the Evidence Act 1995 (Cth) are applicable. (authorities omitted; emphasis added)
Finally, in Buffrey v Buffrey [2006] NSWSC 1349 Palmer J at [14] said that whilst the presumptions of resulting trust and advancement “often compete”, nonetheless “like all evidentiary presumptions” they “give way to facts showing the contrary” ([14(1)]); and that “whether either presumption is rebutted depends upon the intention solely of the party who provided the money” ([14(4)(a)]). His Honour observed that the principles upon which the Court proceeds are “well settled”. His Honour provided a comprehensive list of the principles, referenced extensively to the authorities. There is nothing controversial in his Honour’s formulation of the principles. I will set out those of particular relevance here:
[14] The presumptions of resulting trust and advancement often compete in cases between husband and wife, or de facto spouses, or between parent and child, where title to property is held in joint names but the parties have made unequal contributions to the cost of acquisition. The principles upon which the Court proceeds are now well settled and can be summarised thus:
(1) one begins with the presumption that the equitable title to the property is at home with the legal title but that presumption, like all evidentiary presumptions, gives way to facts showing the contrary; …
(3)the presumption of resulting trust may be rebutted by showing that there is a relationship between the parties giving rise to the presumption of advancement so that the party who has contributed less or nothing to the acquisition cost is nevertheless to have an interest in accordance with the legal title;
(4)if a presumption of resulting trust or a presumption of advancement arises where one party has contributed the whole of the acquisition cost of the property but the title to the property is placed in the name of another party:
a)whether either presumption is rebutted depends upon the intention solely of the party who provided the money because the question is whether that person intended to make a gift of an interest in the property to the person who did not contribute to its acquisition;
b)evidence by the person making the payment as to his or her intentions at the time of the transaction is admissible but the Court will treat that evidence with caution as the evidence of an interested party;
c)the Court is more assisted in determining the subjective intention of the person making the payment by evidence of that person’s contemporaneous statements of intention, subsequent admissions against interest, subsequent dealings with the property, and by evidence of other relevant surrounding circumstances;
…
(7) for the purposes of the presumptions of both of resulting trust and of advancement:
a)the acquisition cost of property includes the costs, fees and disbursements incidental to its acquisition;
b)a party contributes to acquisition cost by borrowing funds necessary to make up the acquisition cost, whether or not that party subsequently contributes to payment of principal and interest due on the borrowing;
c)parties borrowing jointly in order to make up the acquisition cost are treated as having contributed the borrowed capital in equal shares;
d)a party who does not borrow funds to make up the acquisition cost but who subsequently pays, or contributes to payment of, principal and interest on such a borrowing does not, by that fact alone, make a contribution to acquisition cost.(authorities omitted; emphasis added)
In relation to the present case, I would extract the following principles as particularly relevant:
1.All evidentiary presumptions give way to facts showing the contrary: Buffrey, [14(1)].
2.The presumption of advancement is a rebuttable presumption: Shephard v Cartwright, [445-6].
3.Although a purchase in the name of a child, if altogether unexplained, will be deemed to be a gift, evidence as to the surrounding circumstances of the purchase might lead to the conclusion it was a trust, not a gift: Russell v Scott, [453].
4.Where evidence has been given as to the intentions with which the parties effected a transaction, it is unlikely that the question whether or not there is a presumption of advancement will be important, or at least decisive, for if there is a presumption, it is only prima facie, and evidence may be given to rebut it: Napier, at 154-5.
5.Whether either presumption is rebutted depends upon the intentions solely of the party who provided the money: Buffrey, [14(4)(a)]
6.Subsequent acts and declarations are admissible as evidence only against the party who did or made them, and not in his favour: Shephard v Cartwright, 445-6; subsequent acts and declarations of the parent are not evidence to support the trust, although subsequent acts and declarations of the child may be so; but, generally speaking, it is necessary to look at what was said and done at the time: Charles Marshall, 363-4.
7.This however does not exclude testimonial evidence of intention, so that a person whose intention at an earlier time is in issue may give evidence of it, even though the weight of the evidence, coming as it does from an interested witness, must be scrutinised with care: Damberg, [45].
8.Whilst the Briginshaw principles do not apply, proof nonetheless is required of a “definite intention” to retain beneficial title, not a “nebulous intention to rely upon the … relationship as a source of control over the property”: Damberg, [44].
9.The rules for admissibility of evidenceare those of the general law “that any modifications effected by the Evidence Act 1995 (Cth) are applicable”: Damberg, [45].
Sections 140(1) and (2) of the Evidence Act 1995 (Cth) provide:
Section 140 Civil proceedings: standard of proof
(1)In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.
(2)Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account:
(a)the nature of the cause of action or defence; and
(b)the nature of the subject-matter of the proceeding; and
(c)the gravity of the matters alleged.
Whilst the observations to which I have referred in the authorities have effect that the Briginshaw principles do not apply, regard nonetheless must be had to the statutory mandate in s 140(2). Moreover (1) there is the need “for proof” of a “definite intention” of a claimant to retain beneficial title; and (2) the weight of such a claimant’s evidence, “coming as it does from an interested witness”, “must be scrutinised with care”.

The evidence

Against this background, I will turn now to the evidence.
It is convenient to deal with the resulting trust/presumption of advancement issues in the chronological order in which relevant events occurred.
I therefore will commence with item 4, as being the first in time.

Item 4 – AUD $190,000 remitted by the husband to Japan

As I have mentioned, the husband and the wife had married in the Philippines in May 1993. The husband at that stage resided in Japan while the wife and K, and subsequently the wife K and X resided in the Philippines. The husband requested of his father, that he, the wife and the children live with the husband’s parents in their home in Japan. The husband’s father had rejected the husband’s request: “I told him, no” (husband’s father’s affidavit, par 33); and that he had made “very clear” to the husband that “they could not live in Japan” (husband’s father’s affidavit, par 61).
In consequence, the husband told his father that he was “looking to migrate to another country”, and that he “wanted to find a country where there were many foreigners so that they would have a better chance of mixing and to prevent the children from being bullied” (husband’s father’s affidavit, par 62).
The husband’s father said, in relation to the moneys originally advanced:
66.In late 1994 [the husband] told me that he and [the wife] could migrate to New Zealand with the children and that he needed a bond of NZ$100,000 to satisfy the New Zealand government’s financial capacity and migration requirements.
67.[The husband] told me that he had tried to raise the necessary funds but couldn’t and that he had tried to put up his personal effects including some jewellery to satisfy the financial requirements to obtain a permanent visa.
68.[The husband] asked me if I could help him with the necessary bond. I told him that I would lend him the money. He told me that it would have to be deposited into an ANZ bank account in Auckland.
69.I told [the husband] that I would lend him the money on condition that it would be repaid to me on demand and that he was not to spend any of the $100,000. He agreed.
70.On or about 13 February 1995 I lent the amount of NZ$100,000 to [the husband] and arranged for the funds to be electronically transferred from my bank account in Tokyo.
71.In April 1995 [the husband] left Japan permanently to live with [the wife] and the children in New Zealand. (emphasis added)
The husband’s father then said (same affidavit):
74.When I originally lent the amount of NZ$100,000 to [the husband] for the bond I did not discuss with him the issue of what was to happen with the interest earned on the $100,000. I did this to help [the husband], [the wife] and the children. The money came from my savings which savings I would need to access in the future to live on when I retired from work.
75.I deny [the wife’s] assertion that the money was a gift. It definitely wasn’t. I deny the allegation made by [the wife] that it was gifted to my son because [the husband’s mother] and I are financially comfortably well off. I do not believe that we are. I am now 70 years of age and still working. I plan to continue working for as long as I am able to. I never gifted money to my daughter when she married. If I had gifted the money to [the husband] I would have favoured him over his sister. I would not do that. My daughter and her husband have a 35-year mortgage on their home. I have not paid any money towards their mortgage.
76.Subsequently, [the husband] told me that he could repay the money. He told me that he did not need the bond any further. I asked [the husband] what rate of interest the money would earn if invested in New Zealand. Based on what he told me I calculated that with the exchange rate and the more favourable rate of interest in New Zealand compared to that being offered in Japan that it was better for me to keep the money invested in New Zealand.
77.I instructed [the husband] to invest the money in a fixed term deposit in New Zealand and to continue to reinvest the money each time the term deposit matured along with the interest earned on the investment.
78.To the best of my knowledge [the husband] followed my instructions. I understand that [the wife] asserts that she and [the husband] utilised some of the interest earned from investing the principal sum for their living expenses. If that is true it was done without my knowledge or consent.
79.I reserve my right to argue at the trial of the proceedings the proper legal characterisation of the NZ$100,000 Bond and the interest earned on the investment of that sum.
80.At all times the NZ$100,000 Bond was advanced by me to my son on the express understanding that it was to be kept by him, only to be used as a bond and to be repaid to me on demand. It was money advanced by me on the basis that it was to be used for express purpose of being used as a bond. The money was not his to do with as he pleased. It represented a significant part of my accessible cash savings. Based upon what [the husband] told me would happen with the money I was of the opinion that it was secure. I trusted my son. (emphasis added)
The husband said in his affidavit:
24.In April 1995 my Wife and I relocated to New Zealand with our two children. My Father, [T Kawada] (“my Father”) loaned us NZD $100,000.00 (approximately AUD $87,650.00) as bond for our Permanent Residency Application. Full particulars of the money my Father’s (sic) loaned my Wife and I will be given later in this affidavit.
…
33.In April 1995, my Wife and I migrated to New Zealand with our two children. My Father loaned us NZD $100,000.00 (approximately AUD $87,650.00) in February 1995 to use as bond for our Permanent Residency Visa Application. There was always a clear understanding between my Father, my Wife and I that this money was to be returned to my Father.
34.When we arrived in New Zealand we invested the NZD $100,000.00 (approximately AUD $87,650.00) in a term deposit with ANZ Bank in a joint account so the money was earning interest for my Father. My name and my Father’s name was listed as signatories on the joint account.
35.When our family relocated to Australia in January 1999, my Father instructed me to transfer the money as held in the term deposit account over to Australian account as the interest rate with ANZ Bank was 9.8% at that time, and my Father wanted to grow the money to use as his retirement fund. Australian Banking Regulations did not permit an account to be opened in my Father’s name as he was not resident in Australia; as such the account was opened in my sole name. I later added my Wife’s name on the account as I was concerned if something happened to me the money would go to a Government Fund.
36.In or around 2001 the money was transferred from the ANZ Bank to Suncorp Bank as Suncorp offered a more competitive interest rate.
37.Neither my Wife nor I made any financial contribution whatsoever towards the money as held in the term deposit. As deposed to below, in September of this year upon my Father’s request, the principal sum plus all accrued interest in the amount of AUD $190,000.00 was returned to my Father. (emphasis added)
The wife said in her affidavit:
12.1In 1995, [the husband’s] father gifted to [the husband] and I the sum of NZ$100,000 to assist us in our relocation to New Zealand. At the time of making that gift, neither [the husband] nor his father made any mention of this advance as anything other than a gift. There was never any mention of the monies being advanced on trust and/or by way of loan. When I thanked [the husband’s] father for the money that enabled us to go to New Zealand his only response was “You’re welcome”.
12.2In order to apply for New Zealand residency [the husband] and I were required to prove to the New Zealand Department of Immigration that we had sufficient moneys to support ourselves and our then two minor children. [The husband] and I were able to declare to the New Zealand Department of Immigration that we did have settlement funds in the sum of NZ$100,000. Annexed hereto and marked “IIK 1” is a copy of a document entitled “Summary of Application for New Zealand Residency under the General Points System by [Mr Kawada]”. In this document prepared by [the husband], he records that he had NZ$100,000 in Invested Funds.
12.3The NZ$100,000 was invested on term deposit for a fixed period of two years with the ANZ Bank in New Zealand in [the husband’s] sole name. [The husband] and I received interest payments from the term deposit moneys at regular intervals and we used this money to subsidise our living expenses. [The husband] was the sole signatory. [The husband] was working in a … restaurant at this time but this source of income was not enough to support our growing family.
12.4The NZ$100,000 was invested for a total of four years in New Zealand.
12.5In or about February 1999 we relocated to Australia, and transferred the monies held on term deposit with the ANZ in New Zealand to the ANZ in Australia in our joint names. Both [the husband] and I were signatories on the account.
12.6For the years between 1999 and 2008 [the husband] transferred the interest from our invested monies to a separate ANZ savings account also in our joint names. Part of the monies were reinvested and part of the monies were again applied to our living expenses. Annexed hereto and marked “IIK2” is a bundle of bank statements for various periods between 10 August 2006 and 9 July 2009 in our joint names evidencing the interest from the invested monies being transferred to our joint savings account.
12.7At no time at all during our marriage did either [the husband] or either of his parents ever mention to me or suggest that the entire advance of NZ$100,000 was anything but a gift. There was never any discussion in relation to the advance. Never did [the husband’s] parents ask for the money back. Never did they ask for interest. Never did they ask where the monies were. Not once did they ever raise any mention about the monies whatsoever.
12.8Without being certain as to the date, I recall that in or about 2000, we transferred our investment monies from ANZ bank to a new investment account in our joint names with Suncorp.
12.9By June 2009 the investment monies totalled AUD$190,000. [The husband] withdrew these funds from our joint Suncorp Fixed Term Deposit account and transferred them into an account in his sole name on 26 August 2009. As deposed to above, [the husband] transferred those funds to his father in Japan after my friend had told him that I was unhappy in the marriage and contemplating separation. Annexed hereto and marked “IIK 3” is a Suncorp bank statement dated 26 August 2009 evidencing the transfer of the investment funds from a/c no. …46 a joint fixed term account to a/c no. …84 an account in only [the husband’s] name. Subsequently, [the husband] then transmitted the AUD$190,000 to his father in Japan.
12.10[The husband] alleges that his father has made formal demands for return of the monies that were “loaned” to us. Annexed hereto and marked “IIK4” is a copy of an English translation from a Japanese document from [the husband’s father] to [the husband] called a “Receipt” dated 25 September 2009.
12.11I dispute the validity of this transfer and say that there was never a loan agreement between father and son.
12.12I declared in my ATO income tax returns that interest on the invested monies was income. Annexed hereto and marked “IIK 5” is a bundle of my taxation records for 2007, 2008 and 2009. (emphasis added)

Mr Page submitted that the presumption of advancement applies in relation to the moneys, and is not rebutted by any of the husband’s and the husband’s father’s evidence, such amounting only to “advices” by the husband’s father to his son as to the use to which he should put the moneys.
Mr Page referred to par 80 of the husband’s father’s affidavit (set out above) to support the submission that the money was “advanced” to the husband “to be used as a bond” and that par 80 does not refer to what was to happen to any interest earned on the moneys to the effect that I should find the moneys were gifted to the husband and/or the husband and the wife. This submission overlooks I think that the husband’s father’s evidence in par 80 expressly is that the money was “only to be used as a bond”, was “to be repaid to me on demand” and “was not his to do with as he pleased”.
Mr Page referred to par 35 of the husband’s affidavit (set out above) submitting that the husband’s evidence as to the later addition of the wife’s name on the account was inconsistent with any notion that the moneys invested belonged to his parents. In contrast the husband said in his oral evidence that he added the wife’s name to the account when the money was in Australia because the wife asked for that to occur, having “convinced” him that if the money was in his sole name it “would go to a Government Fund” and not back to his father in Japan. He said in his oral evidence “She told me that she was going to pay the money back to my father if something happened to me”. My understanding of his evidence is that the wife convinced him that if “something happened to me” the money in the Australian account in his sole name would go to a Government Fund and not to his father in Japan, but that if the wife’s name was added, and something happened to him, the wife would “pay the money back to my father”.
This evidence under Mr Page’s cross examination of the husband had not been put to the wife in the husband’s cross examination of her. However, as the evidence was a response elicited in cross examination directly in relation to the husband’s affidavit, it was not a matter necessary for the husband to put to the wife. Be that as it may, in fairness I will ignore the husband’s oral evidence on this point, elicited in cross examination, and rely only on the last sentence of par 35 of the husband’s affidavit, which I accept.
The husband’s father’s evidence is clear that the money expressly was provided for the sole purpose of being used as a bond, and was not for the husband “to do with as he pleased”, and was repayable on demand: husband’s father’s affidavit, par 80, which I accept, in relation to the corpus or principal amount advanced.
My acceptance of the husband’s father’s evidence is fortified by his further evidence that he would not have favoured the husband over the husband’s sister, who had a 35 year mortgage (husband’s father’s affidavit, par 75); and that the moneys came from his savings which he needed in the future for his retirement (husband’s father’s affidavit, par 74).
Moreover, the addition of the wife’s name to the account/s by the husband some four or so years after the moneys were paid to the husband by the husband’s father cannot have bearing upon the husband’s father’s intention at the time he provided the moneys, early 1995.
I turn now to evidence concerning interest payable on the moneys. The husband’s and the husband’s father’s evidence about this was consistent. The husband’s father’s evidence (par 74) was that “originally” there was no discussion as to what was to happen with the interest earned, and that subsequently, because the husband “did not need the bond any further”, with the husband then saying he could repay the money, the husband’s father asked the husband “what rate of interest the money would earn if invested in New Zealand” and that “based on what he told me”, he, the husband’s father, calculated by reference to the exchange rate that interest was more favourable in New Zealand than in Japan so that it was “better for me to keep the money invested in New Zealand” (husband’s father’s affidavit, par 76). Thus, the husband’s father “instructed” the husband to “invest” the money in a fixed term deposit in New Zealand and “to continue to reinvest the money each time the term deposit matured along with the interest earned on the investment” (husband’s father’s affidavit, par 77).
Under Mr Page’s cross examination the husband said, in my view cogently, to the effect “I reported to my father when the maturity comes each time and every time it matured I spoke to my father as to what he wanted to do. Sometimes he asked for interest to be sent to Japan. Sometimes he said to start another IBD account, and we discussed beforehand what would happen next”. In clarification, as I understand the husband’s evidence (given in Japanese at the trial and interpreted) its effect was not that sometimes his father instructed that the interest be sent to Japan and sometimes that he instructed that the interest be reinvested with a new IBD investment, but that they discussed these things, and that each time, as events transpired, his father in fact instructed that accumulated interest was to be reinvested upon each rollover with a new IBD investment, such that at no stage was accrued interest in fact periodically remitted, but always reinvested.
By the time the husband’s father was cross examined, the question whether there was specific agreement between the husband and his father as to “what was to happen with the interest” was a keen issue. I am conscious that, by this stage, the husband’s father, as a party to the proceedings, had had the benefit of listening to his son’s evidence in this regard, interpreted for him by the Court interpreter. Nonetheless, upon my keen listening to the husband’s father’s evidence on this subject matter, I had no reason to doubt its veracity, his evidence under cross examination being strong and definite. In short, although the husband’s father acknowledged, as stated in his trial affidavit (par 74) that when “originally” he “lent” the money to the husband he and the husband did not discuss “the issue of what was to happen with the interest”, when the husband no longer needed the bond and said he could repay the money, he instructed his son to “invest the money in a fixed term deposit in New Zealand”: husband’s father’s affidavit, pars 76, 77; and subsequently the money was invested in Australia when the husband and the wife moved to Australia, as explained.
In his oral evidence the husband’s father said that after transfer of the moneys from New Zealand to Australia, he and his son had further discussions about what was to occur with the interest, and said “Yes, all the interest I accumulated was to go back into the term deposit”, “because the interest rate was higher in Australia”. The husband’s father was asked by Mr Page whether he discussed the matter of interest with his son after each rollover of term deposit, or only at the commencement of the first term deposit in Australia, to which he responded “Every term as well as during the term”. When asked whether he told his son that he could spend any part of the interest, his firm response was “No”.
On all of the evidence, I find that the husband’s father’s intention in providing NZD100,000 was that it be used for the express purpose of being held as a bond to enable the husband and the wife to migrate to New Zealand, and that the amount was neither a gift nor a loan. In so finding, I would refer not just to the evidence already discussed but also that discussed below and the observations made in relation to it.
I am conscious of the husband’s father’s use of the word “lent” in his affidavit par 74, and perhaps elsewhere in his evidence.
Certainly, on the husband’s father’s evidence, which I accept, the money was not a gift, as contended by the wife.
As to whether it was a “loan”, it is a hallmark feature of a loan that the borrower may deal with moneys lent for his or her own purposes, as he or she pleases, such that a debtor/creditor relationship is created, with or without interest terms. In contrast, it is a hallmark feature of a trust, in particular a resulting trust, that the corpus, and all accretions, be preserved for the donor: Potter & Potter [2003] 3 NZLR 145 at [13]; see also HAJ Ford and WA Lee, Thomson Reuters, The Law of Trusts, vol 2, (at update 80) [21.040].
On the evidence which I accept, that is the circumstance here. In particular, I accept the husband’s father’s evidence that the corpus was “not his to do with as he pleased”, that is, not the husband’s to do with as he pleased, but was to be used and held by him, including as to interest, only upon his father’s specific instructions. I would conclude thus that the husband’s father’s use of the word “lent” in par 76 (see also pars 68, 69, 70) is used in the lay sense, not the legal sense. Further I note that the husband’s father said in his affidavit (par 79) expressly that he reserved the right to argue at the trial “the proper legal characterisation” of the bond and the interest earned on its investment.
In respect of my conclusion, I need to deal, somewhat shortly, with further arguments to the contrary, based on the wife’s evidence and arguments by Mr Page.
First, the wife disputes the husband’s affidavit, par 33, that there was always a “clear understanding” between himself, the wife and the husband’s father that “this money was to be returned to my Father”. The wife said (her affidavit, par 12.1) that when she thanked the husband’s father “for the money”, he said “You’re welcome”. To my mind, such expression of thanks, and the husband’s father’s response, is not inconsistent with the wife’s “thanks” for the husband’s father’s provision of the bond which the husband needed for himself, the wife, K and X to migrate to New Zealand, and does not suggest a gift rather than provision of the bond, to be held in accordance with the husband’s father’s stated intention and instructions to the husband.
Mr Page relied heavily on the wife’s evidence that, in both New Zealand and Australia, interest earned on the corpus was used by the husband and herself for their living expenses (wife’s affidavit, pars 12.3; 12.6); that between 1999 and 2008 interest was “transferred” to a joint savings account of the husband and herself (par 12.6); and that in her tax returns for the years 2007-2009 she declared interest on the “invested moneys” (par 12.12).
Mr Page, in his cross examination of the husband in relation to a joint account held by the husband and the wife, annexure IIK2 to the wife’s affidavit, referred to 2 withdrawals, namely $330.20 EFTPOS withdrawal 22 August 2005 and $781.73 EFTPOS withdrawal 12 January 2006. (There is a third EFTPOS withdrawal $350.75 20 June 2006). All other transactions appear to be rollover deposits and interest deposits subsequently reinvested (see the deposits, and withdrawals after the deposits) save for monthly debits of about $62.41 (one of $55.39) all to “Suncorp General Insurance”, plus monthly bank fees of $6.00. The purpose of the 3 EFTPOS withdrawals was not able to be identified in evidence. Mr Page endeavoured to set up the case that certain deposits to that account “must be characterised as interests deposits” earned on the IBD investments, so that, Mr Page argued, it is “plain” that contrary to the husband’s and the husband’s father’s case, all interest on the IBD investments was paid to and deposited into the husband’s and the wife’s account from time to time. However, looking at IIK2, it appears that after each such deposit capable of being so characterised, there appeared to be further IBD investment. See, for example, statement sheets 58, 68 and 70.
Thus, it does not appear to me that IIK2 evidences any use by the husband and the wife of interest earned on the IBD investments, or if there was, little use. To the extent that the wife bears the onus of proof in this regard, I find it not discharged.
Moreover, the husband’s father said in his affidavit (par 78), which I accept, that if any interest earned from investment of the corpus was used by the husband and the wife for their living expenses, that was done without his knowledge or consent.
In relation to the wife’s tax returns for 2007-2009, which are annexed to her affidavit, it appears that she declared interest in the 2008 and 2009 tax years of $4,801 and $6,338 respectively, the “Bank/Branch/Account” described in her tax returns as “Suncorp”: annexure IIK5 to the wife’s affidavit. Possibly, although not clear, these amounts might refer to half of the gross interest earned on the IBD investments of the husband’s father’s money and perhaps deposited (that is, the interest) to the Suncorp account in the joint names of the husband and the wife before its withdrawal and reinvestment after each IBD rollover. The wife’s tax returns for those years were prepared by PG Accountants. There is no evidence by any representative of that firm as to the basis on which these inclusions were made in the wife’s tax returns for those years. Possibly, as is often the case, an accountant will ask a party to provide all bank statements in the taxpayer/client’s name, and the person who prepared the wife’s tax returns IIK5 might have presumed, on the face of some documents provided, eg bank statements, that the wife had a tax liability which indeed personally she did not have. Be that as it may, without further evidence, the mere circumstance that the wife may have paid income tax upon interest earned on the IBD investments cannot retrospectively convert any resulting trust in relation to the moneys held on IBD to a gift or indeed a loan. Rather, absent proper instruction, the accountant engaged by the wife might have presumed that the interest earned was taxable in the wife’s hands. Possibly, thus, the wife or her accountant erroneously included these interest amounts in her tax returns. However, the wife’s tax returns do not displace the husband’s father’s evidence as to his intention in relation to the moneys.
In his oral evidence, the husband said that all discussions with his father in relation to the initial provision of the moneys, and investment and reinvestment subsequently, were between him and his father. Although he said (affidavit, par 33) that there was always a “clear understanding” between his father himself and the wife that “this money” (being the amount initially provided to be used as a bond) was to be returned to his father, this does not suggest any contradictory evidence of any discussions with his father involving the wife.
I deal now with a matter upon which Mr Page placed considerable reliance.
While the wife was in the witness box, the following ensued. First, Mr Page elicited some personal updated information from her. Secondly, the husband cross-examined her, followed by the husband’s father. Then, at the commencement of Mr Page’s re-examination of the wife, I noticed that the husband, being a litigant in person, was waving his hand at the Bar table. I asked him why he was doing so. The following then ensued: T 20 July 2011 73-74:
HER HONOUR:   Re-examination, Mr Page.
MR PAGE:   Thank you.
HER HONOUR:   Sorry. Mr [Kawda], you had your hand up. What was that for?
MR [KAWADA]:   Yes. I have a question.
HER HONOUR:   Yes – of Mrs [Kawada]?
MR [KAWADA]: Yes.
HER HONOUR:   Look, I will allow it, Mr Page, because it was a short cross-examination and he’s a litigant in person.
<FURTHER CROSS-EXAMINATION BY MR [KAWADA]    [4.05 pm]
HER HONOUR:   Sorry – interpret.
THE INTERPRETER:   I understand that they are debt and a credit card debt, but we had $190,000 saving.
HER HONOUR:   Look, he’s making a submission.
THE INTERPRETER:   He’s got a question.
HER HONOUR:   It’s a question.
THE INTERPRETER:   $190,000 savings. Why did you use the money on the – why did you spend money on a credit card?---Can you repeat the question, please?
$190,000 we had a saving. Why did you use a credit card, why did you spend money on the credit card?---190,000 is for our retirement. That’s what you said.
You knew – did you know that it was my father’s money; that’s why you didn’t touch it?---No. It’s our – it’s for our retirement, and it’s not – it’s a gift from his dad and it’s our savings.
Don’t you think it is not correct, even – if you have a saving, you spend – you make a debt, even though you have a saving?---Because I would rather have to use my credit card than touch the money for retirement.
That is it for the questions.
HER HONOUR:   Yes, Mr Page. Re-examination, thank you. (emphasis added)
Mr Page, in his final submissions, made much of the husband’s questions, submitting that it is wholly inconsistent with the notion of a trust in relation to the NZD100,000 subsequently reinvested. Mr Page submitted that the husband’s questions amounted to admission by him that the advance of the money was consistent with the presumption of advancement, and not consistent with anything else.
I do not accept this submission.
As the trial judge, observing the husband’s demeanour, as well as hearing the content of his questions, it was clear to me that he was making a sarcastic attack on the wife’s case in claiming that the AUD190,000 was their money, held in a savings account. The point of his questioning, thus, sarcastically put, as I understood the husband, was to this effect (my words, to illustrate what I considered to be the thrust of the husband’s questions): “On your case we had AUD190,000 in savings. If that was true, why did you create credit card debt instead of using the AUD190,000?”, the question being rhetorical to prove that the wife simply could not have thought or believed that the AUD190,000 was theirs, otherwise she would have used that money and not needed to create credit card debt.
Caught out, the wife somewhat cleverly retorted that “190,000 is for our retirement. That’s what you said.”
Further, the transcript passage shows that the husband, to this assertion said immediately: “You knew – did you know that it was my father’s money; that’s why you didn’t touch it”, further pointing to sarcasm and rhetoric in the initial questions. The husband’s purpose is further illustrated by his last question, seeking to show that the wife well knew that the invested money was not theirs to use.
The context of the husband’s questions plainly was against the background of his clear case, never waivered from, that the AUD190,000 was his parents’ money, not able to be used by the husband and the wife. Further, the wife’s answer that the AUD190,000 was for the husband’s and the wife’s retirement is illogical because, outside quarantined moneys in a superannuation fund, priority usually is given by a husband and a wife to paying household bills before seeking to preserve “savings” for retirement, particularly having regard to the ages of the husband and the wife at the relevant time. Thus, the wife’s response that the AUD190,000 was “retirement” savings is indicative in my view that she knew that indeed the AUD190,000 was for “retirement”, but for the husband’s parents’ retirement, not hers and the husband’s.
A final matter concerns evidence that the husband in the course of a series of text messages to and from X told her on 24 April 2010 that he had spent $60,000 on lawyer’s fees. Mr Page raised this in cross examination of the husband. The line of questioning suggested the inference that the $60,000 was part of the AUD190,000 sent to the husband’s father in August 2009, then provided back by the husband’s father to the husband, to invite the conclusion that at all times the husband knew when he sent the AUD190,000 to his father that indeed it was property of the husband and the wife but sent it to Japan in an attempt to put it out of reach of the wife and the Court.
However, even if the husband’s father provided such funds to the husband, and even if such were sourced in the AUD190,000 remitted to him in August 2009, that is a discrete later transaction not having bearing on the husband’s father’s intention and purpose when the moneys were provided in April 1995. If, for reasons of his own, the husband’s father subsequently either gifted or lent the husband $60,000 (or any amount) to assist the husband to pay his legal fees that is a discrete subsequent matter between father and son.

I have carefully considered all of the evidence, being cognizant of the matters in s 140(2) of the Evidence Act, and the relevant principles to which I have earlier referred, especially the need to scrutinise with care the evidence from an “interested witness” (the husband’s father), and the need for proof of “definite intention” of the husband’s father to retain beneficial ownership of the money initially provided and all interest subsequently earned, in particular in the context of the opportunity for collusion between the husband’s father and the husband, and find without hesitation that the husband’s father’s intention at the time of initial provision of the bond, and at all times subsequently, was to retain beneficial ownership of the amount initially provided and all interest subsequently earned. Although initially the husband’s father and the husband did not discuss interest, during the period the money was used as a bond, subsequently they did, with the husband’s father making clear that all accumulated interest was also to be invested at maturity.
I am fortified in this view by the husband’s father’s reference to his daughter, and her particular financial position, such that he would not have preferred his son over his daughter by way of gift to his son.
Further, the husband’s father said (affidavit, par 76) that when the husband said that he could repay the money, the bond for New Zealand resident status no longer being necessary, he asked the husband “what rate of interest the money would earn if invested in New Zealand”. If the moneys were a gift, such that the moneys belonged to the husband, or the husband and the wife, it would seem unlikely that the husband’s father would have concerned himself with such a question, nor indeed that the corpus would have been continued to be preserved.
As to coincidence in timing between the husband’s father’s request for the AUD190,000 to be remitted to him in August 2009, such may well have been linked to the demise of the marriage between the wife and the husband, separation occurring at the end of the following month. However, the husband’s father was entitled to do that, to protect money which belonged to himself and his wife.
In Napier (above), Gibbs ACJ said that when evidence is given as to the intention with which parties effected a transaction, it is unlikely that the question whether or not there is a presumption of advancement will be important or at least decisive. This is such a case. Although in some of the authorities the presumptions are described as “competing”, the presumption of advancement is only an evidentiary presumption, which must give way to facts showing the contrary: Buffrey at [14(1)].
The surrounding circumstances point also to a trust, not a gift. I have mentioned two of these already (1) the circumstance of the husband’s parents daughter and the husband’s father’s evidence that he would not favour his son over his daughter; and (2) the circumstance of the husband’s father asking as to interest rates in New Zealand when the husband said that he no longer needed the bond and was ready to return the corpus to his father.
In all of the circumstances I find in relation to the money initially provided and all interest subsequently earned:
a.      the husband’s father did not intend to advance the husband by beneficial ownership of the money, but allowed him to use it for the express purpose of being used as a bond, there being a clear understanding between the husband and the husband’s father that all interest earned on investment of the money also belonged to the husband’s father, all such investment for interest being at the husband’s father’s instruction
b.      the presumption of advancement is rebutted
c.      the facts amount to a “classic illustration” of a resulting trust.
Accordingly, I will declare that the amount of AUD190,000 remitted by the husband to the husband’s father in August 2009 belongs to the husband’s father and the husband’s mother beneficially and I will exclude this from the pool of assets available for division between the husband and the wife.

Item 1 – The P property

The wife and the husband lived in New Zealand for about 3 years and 9 months, April 1995 until January 1999. They moved from New Zealand to Australia in January 1999. They rented premises initially upon their move to Australia.
The P property was purchased in early 1999, in the husband’s name only. It is registered in the husband’s name: see the contract for purchase (first page) wife’s affidavit, annexure IIK6, and the title extract, annexure IIK7.
The husband’s parents provided AUD165,000 for its purchase being AUD155,000 purchase price and AUD10,000 stamp duty and conveyancing costs.
Before dealing with the parties’ affidavit evidence concerning the circumstances surrounding the purchase, it is necessary that I make clear that the authorities to which I have referred have the effect that I must exclude from my consideration, as inadmissible, exhibits 8 and 9, because they contain or purport to contain evidence of “subsequent” statements or conduct by the husband’s father or his parents asserting ownership of the P property, and I do so.
Thus, I will not set out, refer to, or consider, the content of exhibits 8 and 9.
By way of explanation, when exhibits 8 and 9 were tendered at the trial (exhibit 8 by the husband and exhibit 9 by Mr Page, for the wife), the relevant authorities had been neither collected nor referred to.
However, my judgment in the matter being reserved for decision on 21 July 2011, and having since then had the opportunity to look at and consider the authorities to which I have referred, it is plain that exhibits 8 and 9 are not admissible: Shephard v Cartwright (above) at 445-6; Charles Marshall (above) at 363-4; Damberg (above) at [45].
Accordingly, I disregard exhibits 8 and 9 entirely.
It is necessary for the record nonetheless to deal with a submission by Mr Page, in his written submissions 26 July 2011, par 14(g), that I “assisted” the husband and encouraged the husband in relation to the tender of exhibit 8, and that “procedural fairness” in relation to exhibits 8 and 9 had not been accorded to the wife. There was no “assistance” by me for the husband, or encouragement, as the transcript shows: T 21 July 2011, 51/20-52/15. Moreover, as mentioned, ex 9 was tendered by Mr Page: T 21 July 2011, 55/15-56/30.
However, as I will wholly disregard exhibits 8 and 9, nothing now turns on these matters.
At the time of purchase of the P property in the husband’s name, he did not tell the conveyancing solicitors that he was purchasing it, by arrangement between himself and his parents, by him on trust for them beneficially. Mr Page submitted that if the husband had told the conveyancing solicitors of any express trust between himself and his parents the solicitors would have been alerted to s 11 Property Law Act 1974 (Qld), and would have asked the husband, of necessity, for an instrument in writing to constitute an express trust. Whilst this submission no doubt is correct, concerning the conveyancing solicitors’ duties and obligations, it has little bearing on the matter I am to determine, based upon the authorities to which I have referred, namely the husband’s father’s intention in providing the purchase moneys, stamp duty and conveyancing costs. Moreover, to the extent that Mr Page’s submission is based upon the notion of an express trust, such was not raised by the husband’s father or the husband. In any event, I will observe two things. First, the husband, as a layman, cannot be presumed to have been aware of s 11. Secondly, as mentioned, s 11 catches express trusts, and not implied or resulting trusts: Bloch v Bloch (1981) 180 CLR 390 at 395-7 per Wilson J and at 402-3 per Brennan J.
It is convenient to commence with the evidence of the husband’s father, he being the party who claims a resulting trust in relation to the P property.
The husband’s father said that he and his wife have 2 children, namely the husband, and a daughter E, who lives in Japan with her daughter O 6 years and her husband J.
The husband’s father, in his affidavit, provided his work history and property ownership history in Japan (pars 7-14). In March 1997, he and his wife had finished paying off the mortgage on their home in Japan. In 1998, he closed the construction company which he had set up in 1982. In par 13 he said:
13. In Japan there is no “old age pension” that is provided by the Government. In Japan a person has to save money for their retirement.
14. The retirement age in Japan is 70 years.
He said further:
17. When I was operating my own company I saved money for my own retirement.
18. In 1998 [the husband’s mother] and I owned our own home and enjoyed a reasonable standard of living. We had approximately AUD $500,000 in savings.
19. The amount of approximately AUD $500,000 that I had in savings included my then retirement trust fund monies. However, I could only access about 90% of these monies as cash. The balance was made up of Nenkin superannuation that I could not access at the time.
By way of background to the present matter, he said the husband was still living at home with himself and his wife when the husband met the wife and commenced a relationship with her, but that the husband kept his relationship with the wife a secret. He said that it was only by chance that he learned of the relationship by seeing in the husband’s room a photograph of the wife it being “obvious” that she was pregnant. He was furious with his son and felt that he had “done a very foolish thing and brought much shame upon the family” (pars 25-27).
He said:
29.Because [the wife] was a foreigner and in particular because she was from the Philippines and that she had worked as a hostess in a club I did not believe that the relationship would or could work, certainly if they were to live in Japan as a couple. I was concerned because I believed [the child K] would be bullied and discriminated against by other Japanese people. It would not be fair on [K]; it was not the child’s fault.
30.At the time, I believe that it would have been extremely difficult if not almost impossible for [the husband] and [the wife] to live in Japan as husband and wife. I do not believe Japanese cultural norms have necessarily softened that much with the passage of time though there is a greater acceptance now of “international” relationships and marriages. However, when it comes to women from the Philippines there is still to this day a negative stigma attached to such relationships.
He said that he told the husband that he would not support any marriage to the wife, and that indeed he did not know that the husband had married the wife until he discovered, again by chance, that they had married (pars 31, 32).
He said:
33.Soon after [the child K] was born [the husband] asked if he, [the wife] and [K] could live in our home. I told him, no.
He then said:
36.Initially and for a time I felt much shame because of what my son had done.
37.I came to realise however that I had to accept the fact of my son’s relationship with [the wife]. My attitude softened because of the children. They were not to be blamed, it was not their fault and they were innocents. I felt a love for my grandchildren, as any grandfather would. Overtime [the husband’s mother] and I developed a better relationship with [the wife]. We were fond of the children.
However, he said further:
38.After [the wife] and [the husband] separated I learned from my son that [the wife] is now claiming that money lent by me to my son to enable him to obtain a New Zealand permanent visa for each of them, and later, monies sent to him in Australia for the purchase by him on trust for me of the house at [D Court, P] and the Ford Falcon motor vehicle were intended as gifts by me. That has resulted in a breakdown of [the husband’s mother] and my relationship with [the wife].
39.I deny [the wife’s] allegation that the money or property were gifted to my son. That is simply not true. I explain below why that is not true.
He then summarised visits by him to Australia, both before the husband and the wife moved here in 1999, and subsequently. Before 1999, his visits to Australia were in June 1992, April 1994, February 1998 and February 1999. His visits after the husband and the wife moved to Australia were in January 2000, January 2002 and January 2004 (par 40). He said, which I accept, that in June 1992 he had visited the Gold Coast for a golfing holiday, and was “very impressed by the place”, and the “relative low cost of living”, and “I decided to look at the possibility of buying land on the Gold Coast” (par 44).
On his first visit to Australia, he met with two real estate agents (par 46). At the time (1992) he was a “very keen golfer” and inquired of the agents whether there was land for sale in close proximity to a golf course and in consequence was shown land at various locations and P (par 47). He was impressed by “the people, their friendliness, the wonderful climate and lifestyle generally” (par 48).
In April 1994, his second visit to Australia was for a holiday and “to look at real estate with a view to buying for investment purposes and possible future migration once I retired from employment” (par 52). On this visit he also looked at real estate with real estate agents (par 58).
At this stage, it will be recalled, the wife and the husband had not yet migrated to New Zealand, let alone moved to Australia.
The purpose of his third visit to Australia, February 1998, was to look at real estate on the Gold Coast (par 82). He looked at various houses with his wife, this being her first visit to Australia (par 83). The husband travelled from New Zealand to act as their interpreter (par 83).
He said that by the time of his fourth visit, February 1999, the husband and the wife had then “migrated” to Australia from New Zealand and were living on the Gold Coast in rental accommodation (par 86). On this occasion he again met with real estate agents and inspected houses at various locations and P. He said that he and his wife inspected the houses together, and that the husband accompanied them and acted as their interpreter (par 87). He then said:
88. By this time I had decided that I definitely wanted to buy real estate on the Gold Coast for [the husband’s mother] and I to live in once we retired.
89. On this occasion we saw several properties but did not find anything that was acceptable to me. (emphasis added)
He said that after he returned to Japan he received a telephone call from the husband, advising that he had found a house in the P location that was both “within my price range and was situated on an elevated part of the estate”; that the husband sent him a copy of the floor plan of the house; and told him it was a good property. He said he “trusted” the husband, and that “From my discussions with my son on previous occasions I believed that he knew what I was looking in a house” (pars 90, 91).
I accept all of his evidence as so far set out.
Importantly then he said, which also I accept:
92.The house at [D Court, P] was a “second-hand” property (that is it had been owned and occupied previously) and from my discussion with real estate agents in the past, I believe that I could not purchase the land in my name because I was not a permanent resident.
93.I told my son of the restriction. [The husband] suggested to me that the property could be purchased in his name. I thought that was a good idea. I told [the husband] to make an offer on the property. I told him what price I was prepared to pay.
94.I left [the husband] to negotiate the terms of the contract. [The husband] subsequently told me that the seller was prepared to sell at the price I was prepared to offer. I told [the husband] to buy the property and arranged for the payment of the whole of the purchase price to be sent to him in Australia.
95.I did not gift the land to [the husband]. I sent the whole of the purchase price to him in Australia for the express purpose of buying the land for me. Also, the money was not a loan to [the husband].
96.In addition to the whole of the purchase price, I paid all the conveyancing costs as well as the stamp duty assessed on the contract.
97.Although the land was purchased in [the husband’s] name, he did so for my benefit.
98.At the time the [P] property was purchased, I had less available savings than I had in 1995 when I advanced the bond money (NZ$100,000) to [the husband]. Even if I had wanted to gift the property to my son, I could not afford to do so. The purchase price of the [P] property represented a significant part of my available savings.
99.I deny the assertion made by [the wife] that the land belongs to [the husband].
100.In 1999 when the [P] land was purchased I was in good health. When the land was purchased it was done so with the intention that it would be a future home for [the husband’s mother] and I after I retired. At that time I had not been diagnosed with Cancer.
101.I do not know whether [the husband] told [the wife] that I would “give [them] money to buy a house”, as she says in her evidence. If [the husband] did say that to her, it was incorrect. I advanced money to [the husband] to enable him purchase the house for me and my wife [M].
102.On the subsequent visits to Australia after 1999, [M] and I stayed at the house. On these occasions I spoke openly in front of [the husband] and [the wife] about the house being for [M] and I when I retired, and of desire to migrate to Australia once I retired.
103.During my visits to Australia I often spoke of the house being my house. [The wife] never challenged me about this. (emphasis added)
In a subsequent affidavit he said:
18.It is a true fact that my wife and I invested all our money for the purpose of making an investment in Australia in order to create funds to live on in our old age…
My first daughter ([the husband’s] younger sister) has a 25-year housing loan from a bank and is still working flat out to repay it.
If I were intending to gift it, I would gift it to the two of them equally. I would never gift it only to [the husband]. The money is funds for my wife and me to live on, I cannot afford to gift to anyone. (emphasis added)
In other evidence, to which I have referred already, the husband’s sister’s mortgage was said to be 35 years. However, nothing turns on this.
In cross examination, Mr Page put to the husband’s father “You have no idea what moneys [the husband] and/or [the wife] have spent on the [P] property over the time that they had lived in it, have you?”, to which he responded “No, I don’t know. I [let] [the husband] use the house because he said he will maintain the house”.
When asked whether the husband had provided him with “particulars” of the sums that he spent from time to time on maintaining the house, he said “No, I’m not aware”: T 21 July 2011, 107/20-30.
The husband said that in April 1999 his father purchased the P property as “an investment house”, and as his father was not resident in Australia, “due to restrictions by the Foreign Investment Review Board” the property could not be registered in his father’s name and thus was registered in his sole name (par 39).
He said:
40.There was always a clear understanding between my Father, my Wife, and I that the [P] property was purchased as an investment house for my Father and Mother ([M Kawada]) to move into after my Father’s retirement.
He said that he and the wife made no financial contributions towards the purchase of the property (par 41), and further:
41. … There was an agreement between my Wife, my Father and I that we were not required to pay any rent to my Father for residing in the property on the condition that we look after and cared for the property until such time as my Father retired and my parents migrated to Australia. (emphasis added)

In ASIC v Rich, at [44], O’Ryan J concluded that the authorities establish that there is an “obligation” upon parties to property settlement proceedings “and/or the Court” to “notify” a person or entity who may be affected by a (proposed) order. That is not the effect of the authorities on which his Honour relied. In particular, in Official Trustee in Bankruptcy v Donovan (cited by his Honour at [43], the obligation referred to is as to disclosure, there being reference then to “responsibility” to notify persons with third party interests. There is a clear difference between the suggestion of an “obligation” to notify persons with third party interests (not mandated), and a “responsibility” to do so, in the context of Semmens, as discussed.
Before leaving ASIC v Rich, I would refer to O’Ryan J’s summary at [45]. His Honour’s statement that secured or unsecured liabilities “must” be deducted from the pool of assets before an order is made pursuant to s 79 for property settlement is contrary to the very authorities to which his Honour earlier referred, in particular Biltoft, as extracted in ASIC v Rich at [40]. Plainly, the liability to secured creditors must be deducted, or ordered to be paid, because secured creditors have an interest in any secured property of the parties, such that a s 79 order necessarily must provide for the recognition of that interest. However, the position in relation to unsecured creditors, who do not have an interest in the property of the parties, is as stated in Biltoft. It would seem thus that his Honour in effect was saying that both secured and unsecured liabilities must be deducted to arrive at the value of the pool (net negative or net positive) but that before a s 79 order is made, or rather, in context, as part of that order, ordinarily unsecured liabilities should be ordered to be paid by one party, or the other, or both, to the extent that there is property or assets to do so (but subject also to s 90AE(3)(b)).
Further, to the extent that any of the authorities to which I have referred, and as collected in ASIC v Rich, suggests a mandate (not in the Act, nor in the Rules of Court) that the parties, or the Court, must give notice to unsecured creditors whose interests may be affected by a proposed s 79 order, such is neither mandated by the Act nor the Rules, the remedy of such unsecured creditors ultimately being under s 79A. Rather, as observed (eg Semmens: see ASIC v Rich, at [42]) “justice and common sense dictate that those third parties be given notice”, obviously to avoid later s 79A proceedings.
In this particular case the net negative value of the property and assets of the husband and the wife (whether including or excluding the parties’ superannuation interests, to which the wife’s unsecured creditor presently cannot have recourse in any event), has effect that I am satisfied that this particular case is not one in which the wife’s credit card unsecured creditor should have been given notice of any proposed s 79 order. It is not as if, if notice to the wife’s credit card unsecured creditor be given, its position would be improved, so that it cannot be said that by a s 79 property settlement order its interests may be adversely affected.
Further, as explained, there is no “obligation” to give such notice, but only “responsibility” to do so, if by any proposed s 79 order the interests of such unsecured creditor may be adversely affected. That is not the case here.
Moreover, if the property and assets of the husband and the wife in this particular case (leaving aside their superannuation interests, to which, as I have said, they are not presently entitled) were sufficient to order payment to the wife’s unsecured creditor, the “usual practice” (referred to earlier), I would adopt.
I turn now to Coleman J’s reasoning in Lemnos.
Coleman J dealt with the question at [66]-[101], under the subheading “The Threshold Issue: Whether There Was Any Property to be Divided”, commencing at 83,267.
After setting out, exhaustively, the submissions in that case of, on the one hand, the trustee in bankruptcy of the husband, and on the other hand, the submissions of Counsel for the wife, in particular (as presently relevant) the submissions of the wife, at [92], Coleman J concluded at [93]-[96]:
93.    I accept that the position is essentially as submitted by Senior Counsel for the wife in relation to the “general practice” or “preferred approach” emerging from the decisions to which he, and Counsel for the trustee, referred. As is apparent, these approaches or practices do not find expression in any statutory provisions. Clearly, they must accordingly yield to express statutory provisions.
94.    Whilst there may be cases where, on the facts, the Court may conclude that, there being no “net” property of the parties to the marriage or either of them, no order for alteration of interest in property could, or should be made, I do not accept that the reference to “property” in s 4 of the definition of matrimonial cause is confined to “net” property. Although not so expressed, that is the effect of Counsel for the trustee’s primary submission.
…
96.    There is no legislative provision which expressly or impliedly constrains the Court from making orders with respect to “property”. Commonsense and experience suggest that there will be many cases in which alterations to parties’ interests in property will be appropriate or necessary notwithstanding that the parties have unsecured liabilities which may exceed the parties’ total equity in such property. Subject to s 90AE(3)(b), I perceive there to be no legislative impediment to the making of property settlement orders in such circumstances. (emphasis added)
As I have said, in relation to the “threshold issue” in that case, Thackray and Ryan JJ at [201] agreed with Coleman J. As earlier observed, s 90AE(3)(b) is not relevant in this particular case, there having been no order sought or proposed under s 90AE(1) or (2).
I am bound by that decision.
Thus, I reject the initial submission of Mr Page, as being contrary to Full Court authority, that the circumstance that the property pool of the husband and the wife is of “net negative” value has effect that there is no power under s 79 to make any order other than an order dismissing the wife’s application.
Further, it is plain that I do not accept that it is necessary to create two pools, with the parties’ superannuation interests to be regarded as a separate pool, as submitted by Mr Page, on the basis that if I do not do so I cannot make any s 79 order other than one dismissing the wife’s application.
However, as a matter of discretion I will regard the parties’ superannuation interests as a separate pool, in the particular circumstances of this case, to more easily facilitate the particular order which Mr Page submits should be made which, as will be seen, I propose to make.
In relation to my discretion to regard the property and assets of the husband and wife as one pool, or more than one pool, it is hardly necessary to refer to authority. However, I will do so: Norbis & Norbis (1986) 161 CLR 513; Zyk & Zyk (1995) FLC 92-644 at 82,509-10.
As I have mentioned, Mr Page expressly submitted that the wife seeks no order that the husband pay her credit card debt. As will be seen, expressly this was on the basis that (presumably, if the wife be so advised) subsequently to these proceedings and their finalisation the wife might seek from the husband the payment of her credit card debt by way of a spousal maintenance order.
Suffice it to say that for the reasons given I reject Mr Page’s submission that because there is a net negative pool I have no power to make a s 79 order; or that necessarily I must regard the parties’ superannuation interests as a separate pool to make an order.

Contribution

Principles relevant to the assessment of contribution

In Kessey and Kessey (1994) FLC 92-495 (Full Court) at 89,151 the Full Court made clear that ultimately all that is necessary is to evaluate the weight that should be given to each party’s contributions relative to the contributions of the other party:
… In many – indeed probably in most – property settlement cases the Court has to evaluate and assess contributions to property in the absence of precise valuations of the contributions in question. Indeed, where the contributions to property are indirect or non-financial, precise valuation is impossible, and even where the contributions are direct or financial so that a valuation might be provided, other factors (not capable of precise mathematical statement) may well have eroded the initial value of such contributions. In a case such as the present, it is not necessary to arrive at precise mathematical valuations of the parties’ contributions - all that is necessary is to evaluate the weight that should be given to each party’s contributions relative to the contributions of the other party. (italics and bold added)
In Pierce and Pierce (1999) FLC 92-844 (Full Court) at 85,881 a differently constituted Full Court (except for Baker J) said:
28.In our opinion it is not so much a matter of erosion of contribution but a question of what weight is to be attached, in all the circumstances, to the initial contribution. It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and the wife. In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use made by the parties of that contribution. In the present case that use was a substantial contribution to the purchase price of the matrimonial home: … (italics and bold added)
In Farmer and Bramley (2000) FLC 93-060, Kay J clearly stated 2 things, namely:
The Court’s task is to evaluate all of the contributions from the time of the commencement of the parties’ relationship until the time of the hearing and to give such weight to such contributions as the Court thinks is appropriate in the circumstances (par 68); and
There is nothing in the legislation that requires s 79(4)(a)(b) and (c) contributions to be measured only in terms of what either party contributed to the assets of which the parties are presently possessed (par 69).
In Figgins and Figgins (2002) FLC 93-122 (Full Court) Nicholson CJ and Buckley J made the timely reminder, at par 134:
134.… Marriage is and should be regarded as a genuine partnership to which each brings different gifts. …

Analysis and submissions

The husband claimed to have made initial financial contribution of about $33,000, and considerable financial contribution to the wife, K and X when they were in the Phillipines. This is not doubted, nor denied by the wife.
Despite this, Mr Page and the husband agreed that contribution from the commencement of the parties’ relationship and marriage until separation should be regarded as equal.
Quite properly, Mr Page observed that even if items 1, 4 and 5 are determined to be not property or assets of the husband and the wife nonetheless there has been significant contribution on behalf of the husband by his parents providing the bond to enable the husband and the wife to migrate to New Zealand, and the husband the wife and the 3 children living rent free in the husband’s parents’ home at P for more than 10 years (although the husband and the wife made the rates and insurance payments referred to earlier, and maintained the property at their expense, as early referred) and also had the use of the Ford Falcon motor vehicle for nearly 10 years. The husband assisted with the care of the children (although on his own admission in his affidavit he could have done more in that regard) and contributed his earnings to the family.
This should be balanced, however, Mr Page submitted, against the circumstance that the wife not only was the primary carer of the 3 children, and indeed K’s and X’s sole carer while the wife, K and X were in the Phillipines, but that she worked very hard to maintain the P property, as evidenced by par 11 of her affidavit (above set out), and worked also when necessary outside the home and contributed her earnings to the family, and post separation has been solely responsible for the care and support of the 3 children.
There is also contribution of both the husband and the wife to be considered, in particular in relation to the wife’s affidavit par 11 already set out.
It is common ground, within these parameters, that the parties’ contribution to their aggregate superannuation interests also should be regarded as equal.
Mr Page thus submitted that contribution overall should be assessed as equal.
The husband did not submit to the contrary.
I accept Mr Page’s submission and thus would assess the contributions of the husband and the wife as equal.

Section 75(2)

The husband is 46 years and the wife 43 years.
The husband included in his evidence that he has some health difficulties. Mr Page submitted however that the husband’s evidence (to which I need not refer) that he has ill health is not supported by any medical evidence.
The wife lives with the children and her partner Mr G in rented premises at S near the Gold Coast.
The husband and his new spouse Ms Z live at the P property, presumably on the same basis as I have found was agreed between the husband and the husband’s father, that is, rent free, but provided that the property is maintained.
At the time of the trial the wife was working for modest wages as a carer in a nursing home, and a laundress at a hotel, with K and X each contributing about $50 per week for board from casual employment when able to do so.
At the time of the trial the husband was working as a self employed driver via his company A Pty Ltd using the “Kombi” van, to which I have earlier referred, which apparently is owned by the company.
The husband’s company A Pty Ltd initially was engaged in the business of sports tuition. Subsequently it was engaged in a different business. At the time of the trial the husband said that the “Kombi” van is used by him as a self employed “transit driver” for airport transfers. The husband previously had worked as a waiter, an employee in a duty free shop, a golf tuition person, van driver and tour guide.
There was evidence to the effect that the debts of A Pty Ltd were at the time of the trial of the order of $75,000, and that its assets thus exceed its liabilities by a considerable amount. Hence, the “Kombi” van was, for the purposes of the trial, not regarded as a separate asset of the husband, but an asset of A Pty Ltd, its value being subsumed in the nil value for item 11.
The husband continues to have the use of the Ford Falcon motor vehicle.
The children, it appears, have had little or no relationship with the husband since separation, or at least since the wife was forced to vacate the P property on 30 December 2009, the children vacating it with her. The husband has provided minimal financial assistance in relation to the children since then, seemingly about $1,200 in December 2010 via the Child Support Agency, but no other support in relation to their accommodation, education, health or other costs.
Mr Page submitted that, for the future, potentially the performance of the husband’s company may improve, but that even if it should not, the husband is able to engage in full time work, of one kind or another, whereas the wife has little demonstrated present or future income earning capacity, and nonetheless on the present evidence will remain wholly responsible for the welfare of the 3 children the youngest of whom is still at school.
The wife will be required to continue to pay rent for herself and the 3 children (even if shared with Mr G), whereas the husband has the “resource” of rent free accommodation in the P property, and the use of the Ford Falcon motor vehicle.
Overall, having regard to the husband’s and the wife’s comparative personal circumstances, the wife’s sole ongoing responsibility for the children, and the other matters which I have mentioned, Mr Page submitted that there should be a 75(2) adjustment in the wife’s favour of 30% in relation to the “separate pool”, namely the husband’s and the wife’s aggregate superannuation interests, which amount to $30,747 in aggregate, so that it be divided 80% wife and 20% husband (given otherwise equal contribution of 50%/50%).
Having regard to the modest size of the parties’ property and assets, and the matters referred to above, in particular the wife’s likely ongoing sole care for the 3 children, I am satisfied, that such adjustment under s 75(2) should be made, such that in relation to the aggregate of the husband’s and the wife’s superannuation interests, regarded as a separate pool, by way of adjustment under s 75(2) the wife should have 80% and the husband 20% of the parties’ aggregate superannuation interests, in particular because there is no other net positive pool in relation to which such adjustment could be made.
At the time of the trial, the husband’s superannuation was $16,591 and the wife’s (in aggregate) $14,156. Thus, to give effect to my s 75(2) determination, a splitting order would need to be made in relation to the husband’s superannuation interest, with the base amount for the wife of $10,441, as submitted by Mr Page.
This order was not sought by Mr Page at the trial. However, his written submissions 6 October 2011 (both original and amended versions) squarely gave notice that this specific order was sought.
I am satisfied, by reference to email correspondence on the Court file showing service on the husband of Mr Page’s written submissions 26 July 2011 and 6 October 2011 (both versions) that procedural fairness has been accorded to the husband in relation to the seeking by the wife of this specific order (that is, in the event that I should determine that items 1, 4 and 5 are not property or assets of the husband and the wife, which I have determined). Indeed, in response to Mr Page’s written submissions 6 October 2011 (both versions) the husband filed submissions in response on 12 October 2011: see also the husband’s email to the Court 14 October 2011.

The fourth step

Mr Page submitted (written submissions 26 July 2011, pars 28 and 29), (premised upon his submission that if there be a net negative pool no s 79 property order can be made other than in relation to the parties’ superannuation interests as a separate pool) that the Court “cannot” make any order in relation to the credit card debt of the wife at separation then $35,749 but with interest at the time of the trial $46,981.
I have determined that the premise of Mr Page’s submission that the Court “cannot” make any order concerning the wife’s credit card debt at separation is erroneous, and consider (for reasons earlier stated) that there is power.
However, there is no present basis in these s 79 proceedings, having regard to the particular facts of the case, to exercise the discretion to order that the husband pay all or any of the wife’s credit card debt.
First, whilst on the evidence (elicited by Mr Page in re-examination, and after the husband’s cross examination of the wife designed to persuade me that much of the wife’s pre-separation credit card debt was indulgent waste) it became plain that some of the wife’s pre-separation credit card debt was for the children (eg for dental braces), the state of the evidence at the conclusion of the trial was such as not to allow me, with any confidence, to conclude that any particular portion of the wife’s pre-separation credit card debt was for family purposes, or, conversely, that any particular portion might have constituted expenditure on unnecessary luxuries or waste. To the best of my recollection, the husband said that he was not aware that the wife had any credit cards, let alone the extent of her expenditure on them and that he would not have condoned any such expenditure.
Secondly, there is the circumstance that, on all of the evidence, the husband simply does not have the money to pay the wife’s pre-separation credit card debt: see his financial statement filed 18 December 2009 (as to which there was no update at the trial).

Thirdly, Mr Page specifically sought that there not be an order concerning the wife’s credit card debt.
Fourthly, even if such an order had been sought, there has been no procedural fairness accorded to the wife’s credit card provider of any proposed order that the husband be substituted as the debtor: s 90AE(1)(b); s 90AE(3)(c).
The Court will not make a futile order, nor an oppressive order.
Thus, as made clear in the authorities analysed in ASIC v Rich (above), there are occasions on which, properly, the Court will make an order dealing with the property and assets of a husband and a wife, but not necessarily their debts, or the debts of either of them, leaving the unsecured creditors of a husband and a wife or either of them to their remedies at law.
In my view, in the circumstances which I have outlined, it would be oppressive for me to order that the husband be liable to pay the wife’s pre-separation credit card debt, or any part of it, rather than the wife. Moreover, Mr Page expressly sought that there not be such an order. Further, in relation to Part VIIIAA, s 90AE(1)(b), and s 90AE(3)(c) no notice has been given to the wife’s creditor to accord it procedural fairness to enable me to make such an order in the sense of substituting the husband for the wife as the debtor.
Thus, even if Mr Page had not expressly discouraged such an order (albeit on a wrong premise) it is not an order which in the exercise of my discretion I would make.
Mr Page, in his written submissions (6 October 2011, amended version, par 9), said:
9. There exists no order dissolving the marriage of the parties. The wife has a right to bring an application for spousal maintenance. If the finding is made as has been contemplated, then the wife should be required to forthwith file an application for spousal maintenance and upon so doing there should be an order made by way of interim maintenance that the husband pay the credit card debt of the wife and indemnify the wife and hold her indemnified in relation to the liability of the wife to the bank in relation to the credit card debt to the extent of $49,981.00. The application for spousal maintenance should then be adjourned for directions.
If this submission should be interpreted as one suggesting that, in these s 79 proceedings, I should order the wife to file an application for spousal maintenance, such is inappropriate. It is not the function of the Court to order parties to file applications, but rather to hear and determine them when they are filed.
If this submission should be interpreted as suggesting that I would be capable now of making an interim spousal maintenance order, to the effect that by way of interim spousal maintenance the husband pay the wife’s credit card debt, and indemnify her in relation to such, this also is inappropriate.
First, the wife’s initiating application filed 2 November 2009 did not seek such, and thus the matter of past or future spousal maintenance has not been litigated in these proceedings.
Secondly, there was no argument at the trial about spousal maintenance, and no specific evidence adduced, thus, as to the wife’s need for spousal maintenance, past, present or future, nor the husband’s capacity to pay it, nor any argument or suggestion that, for example, any component of the s 79 order should comprise past or future spousal maintenance.
Thus, as I interpret Mr Page’s submission, at par 9, Mr Page foreshadows that, after the conclusion of these s 79 proceedings, the wife might be in the position to file an initiating application for spousal maintenance if she be so advised.
This, solely, is a matter for the wife and her legal advisers.
For present purposes however I am cognizant in relation to the fourth step that Mr Page expressly did not seek that I include in any s 79 order that the husband pay any part of the wife’s pre-separation credit card debt, with or without interest accumulated as at the time of the trial.
The husband’s pre-separation credit card debt in the smaller amount of $2470, subsequently has been paid by him.
I am left then to consider whether I should include in the s 79 order any reference to items 2, 3 and 11 (savings at separation, subsequently spent by the husband; wife’s ring; husband’s company A Pty Ltd).
In my view I should do so having regard in particular to s 81 of the Act which mandates that a judge should ensure that any s 79 order so far as may be practicable will put an end to the financial relationship between the husband and the wife.
As to item 2, for reasons earlier explained, it is proper that the full amount of $16,000 be regarded as an addback against the husband.
The wife should have her ring, item 3, valued at $1960, and the husband item 11, the shares in his company, valued at nil.
I am satisfied in the particular circumstances of this case that the s 79 order which I propose to make should include reference to items 2, 3 and 11, as mentioned, in addition to the treatment of the superannuation interests of the husband and the wife, as earlier referred to, namely that the wife have her superannuation interests and that there be a splitting order in relation to the husband’s superannuation interest, and that such order not only will be just and equitable, but also will ensure that so far as is practicable there be finality in the financial relationship between the husband and the wife.

Notice to trustee of the husband’s superannuation interest

The trustee of the husband’s superannuation interest has not been given notice of the proposed splitting order. Mr Page submitted (written submissions 6 October 2011, amended version) that I am able to make the proposed splitting order, with liberty to the trustee to apply to set it aside within a specified time. However, I will not do that, as s 90MZD requires that notice be given to a trustee of such order before it is made. I propose therefore to indicate the specific splitting order which I am minded to make, and then, when satisfied as to procedural fairness to the trustee in accordance with s 90MZD, and on the basis that there is no objection by the trustee, to make that splitting order.

Conclusion

Accordingly I will make the declaratory orders earlier mentioned, and will indicate the final s 79 order I propose to make, subject to compliance with s 90MZD.
The s 79 proceedings between the husband and the wife otherwise will be stood over to enable that compliance.
The orders will bear a notation, and an Annexure A, as to the proposed s 79 final order.
Although, as invited by Mr Page SC, I have regarded the parties’ superannuation interests as a separate pool, in particular for the purposes of the s 75(2) adjustment in the wife’s favour (80%/20%) there is no need in the s 79 order to specify that I have done so. The reasons for judgment make that plain.

Procedural matters

There are a few procedural fairness matters which I must mention, having regard to certain submissions by Mr Page SC, in his written submissions 26 July 2011.

“Considerable pressure from the Bench to complete the trial in 3 days” – “early starts/late finishes”

The wife’s proceedings initially were set down for trial for 4 days from 4 July 2011. Early during the hearing on 4 July 2011, I became ill, was hospitalised, and the matter could not proceed.
Fortunately, I was able to offer the parties 4 further days, 18, 19, 20 and 21 July 2011.
Mr Page SC was unavailable on 18 July 2011. The Associate was notified by Jones Mitchell, the wife’s solicitors, that the matter comfortably could be completed within 3 days, namely 19, 20 and 21 July 2011. By return email from the Associate, on my behalf, I indicated that if the parties required it, I would be prepared to sit extended hours on these 3 days, in order to ensure completion of the trial within those 3 days.
As the transcript will show, I was required to make evidentiary rulings on both 19 and 20 July 2011, after extensive and time consuming argument, and to provide ex tempore reasons for judgment on both of those dates. In particular, much of 19 July 2011 was taken up with a submission by Mr Page SC as to the admissibility under s 138 of the Evidence Act 1995 (Cth) of certain Skype recordings made by the wife, despite their admitted illegality, which application failed hopelessly: see the ex tempore reasons for judgment 19 July 2011. Part of 20 July 2011 was taken up by a ruling against Mr Page SC as to certain cross examination of the husband said to be relevant under s 75(2)(o), which I ruled also against Mr Page SC: see the ex tempore reasons for judgment 20 July 2011.
Indeed, by early on 21 July 2011, the trial had not progressed very much.
It is surprising thus to me, to read in Mr Page’s written submissions 26 July 2011, that there was “considerable pressure from the Bench” (par 3(d)), to complete the trial on 21 July 2011, the very basis of my agreeing to the matter being listed for 3 days, rather than 4, being the circumstances referred to.
Mr Page complained of an “early start” on the third day and of a “late finish” on the third day. There had been no demur to this when initially I offered it to accommodate Mr Page’s schedule of unavailability on 18 July 2011.
As the transcript shows any “early starts” were not at unusual times for this Court, nor the alleged late finishing times, the earliest start being 9.21am (21 July 2011), the starts on 19 July and 20 July being respectively at 10.02am and 10.07am); and the latest finishing time being 6.10pm (21 July 2011), the finishing times on the other dates being 19 July 2011 3.46 pm and 20 July 2011 4.47 pm.
On any view, in this Court, those start and finishing times are not unusual, nor untoward.
Moreover, I would not have agreed to the matter being listed for only 3 days, when the original estimate was 4 days, but for the assurance I had been given that the matter comfortably could be completed within 3 days.
In these matters, the Court must rely on the profession, and does so.
Moreover, as I have said much of 19 and 20 July 2011 was taken up with evidentiary matters on which I was required to rule, raised by Mr Page SC, and properly ruled against him.

“The wife had no notice that the husband and his parents claimed a resulting trust”

Next, there seemed to be a complaint by Mr Page, in his written submissions 26 July 2011 (pars 30, 31) that the wife had “run her case” on the basis that the bond advanced, the P property and the Ford Falcon motor vehicle “are all property of the parties or either of them”, such that she had “run her case” on the basis of “what on the evidence of which she had notice was property” of the wife and the husband, such that there had been “no notice” that these items were claimed by the husband’s father as his property, and such that the wife was taken by surprise that these items were disputed by the husband and by the husband’s parents to be property of the husband and the wife, as if this had not earlier been disputed by the husband and the husband’s father.
However, it is plain that these matters were placed in issue by the husband and the husband’s father by their affidavits filed on 18 December 2009 and 10 March 2010 respectively, the contents of which I have earlier referred, and indeed by the response of the husband’s parents filed 10 March 2010, which clearly set out their claims, as summarised in par 2 of these reasons for judgment.
There is thus no basis for the wife, nor her legal advisers, nor her Counsel Mr Page SC, to have considered, at any stage, that ownership of the remitted moneys, the P property and the Ford Falcon motor vehicle was not squarely in issue, and as such, squarely in issue long before even the initial trial dates were allocated.

“Pressure on Mr Page to complete submissions on the third day and strain on Counsel”

Next, in Mr Page’s written submissions 26 July 2011, he put that there was “considerable strain” on him by the early start on the third day (9.21am) and “pressure placed” on him to “make and complete” his submissions “commencing at 5.10pm on the third day” (finish time 6.10pm): par 3(b); and a suggestion that I said that during argument late in the day on the third day that I had “indicated” that I “intended” to conclude on that day (correct) and that “no further submissions could be made”: par 32 (wrong). This is patently wrong, as T 21 July 2011, 142-144, makes plain. In particular, see T143/35-40; T144/4; T144/42-T145/10; T144/35-40.
It is always unpleasant for a trial judge to have to deal with such matters. However, lest the case should be the subject of any appeal, concerning procedural fairness matters, I, as the trial judge, would have no other opportunity to make the observations I have made as to these procedural fairness complaint matters.

I certify that the preceding three hundred and seventeen (317) paragraphs are a true copy of the reasons for judgment of the Honourable Justice O’Reilly

Associate:

Date: 1 May 2012

[2012] FamCA 273

1 May 2012

Key Legal Topics

Areas of Law

Family Law

Equity & Trusts

Legal Concepts

Procedural Fairness

Statutory Construction