Khang & Asmar
[2024] FedCFamC2F 1326
•25 September 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Khang & Asmar [2024] FedCFamC2F 1326
File number(s): SYC 8890 of 2022 Judgment of: JUDGE MURDOCH Date of judgment: 25 September 2024 Catchwords: FAMILY LAW – PROPERTY – Adjustment of property interests pursuant to s79 of the Family Law Act 1975 (Cth) – Where there are substantial issues as to the nature and composition of the property with the wife contending the husband has a legal interest in an overseas financial enterprise operating a business – Where the material and case presented by each of the parties was contradictory and confusing and did little to assist in the finding of facts - Where the wife contends that the husband made her contributions more onerous arising from the principles enunciated in Kennon v Kennon (1997) FLC 92-757 – Where the wife’s contention is not established - Where the husband made superior financial contributions - Where the husband’s failure to provide a full and frank disclosure makes it difficult to ascertain his true financial position- Where a ten percent adjustment is made to the contribution findings in the wife’s favour as a result of the husband’s disclosure failures - Where the husband was granted legal representation funded by the Commonwealth Family Violence and Cross-Examination of Parties Scheme despite living overseas and the husband concedes he did not advise of this when making his application – Where a copy of this judgement will be provided to the Legal Aid Commission and liberty granted to make such application as the Commission sees fit. Legislation: Family Law Act 1975 (Cth) ss 75(2) 79, 117, 102NA
Federal Circuit and Family Court of Australia Act 2021 (Cth) s 190
Federal Circuit and Family Court of Australia Rules 2021 (Cth) Chapter 6
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) rule 1.04, 6.06
Cases cited: Black v Kellner (1992) FLC 92-287
Boulton & Boulton (No 3) [2024] FedCFamC1F 269
Chorn v Hopkins [2004] FamCA 633
Fields & Smith [2015] FamCAFC 57
Gollings & Scott [2007] FamCA 397
Horrigan & Horrigan [2020] FamCAFC 25
Kennon v Kennon (1997) FLC 92-0757
Kowaliw and Kowaliw [1981] FamCA 70
Oamra & Williams [2021] FamCAFC 117
Omacini & Omacini [2005] FamCA 195
Stanford & Stanford [2012] HCA 52
Trevi & Trevi [2018] FamCAFC 173
Weir v Weir [1992] FamCA 69
Division: Division 2 Family Law Number of paragraphs: 196 Date of last submission/s: 21 August 2024 Date of hearing: 19 – 21 August 2024 Place: Sydney Counsel for the Applicant: Mr Connor Solicitor for the Applicant: Marcus Alyssandra Lawyers Counsel for the Respondent: Mr Jackson Solicitor for the Respondent: Sharah & Associates Solicitors and Conveyancers ORDERS
SYC 8890 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS KHANG
Applicant
AND: MR ASMAR
Respondent
ORDER MADE BY:
JUDGE MURDOCH
DATE OF ORDER:
25 SEPTEMBER 2024
THE COURT ORDERS THAT:
1.Within three months from the date of these orders the wife pay to the husband the sum of $190,000.
2.Simultaneously upon the wife’s compliance with Order 1 the Husband shall do all such things as are necessary and sign all documents as prepared by the wife at her expense to:-
(a)cause the mortgage secured on the property situate at and known as B Street, Suburb C in the state of New South Wales being the whole of land contained in Certificate of Title folio identifier … (“the Suburb C property”) to be discharged; and
(b)transfer to the wife all of his right, entitlement and interest in the Suburb C property to the wife.
3.Within 30 days the parties shall do all things necessary to:-
(a)transfer to the wife all the remaining monies held in the Westpac Bank Home Loan account #...54;
(b)direct and authorise the payment to the wife of all monies held in Trust for the parties by D Company.
4.In the event the wife fails or neglects to comply with Order 1 above, the parties shall forthwith upon such failure or neglect do all such things and sign all such documents to list for sale the Suburb C property on the following terms:
(a)To list for auction with an agent agreed upon by the parties in writing within fourteen days and failing agreement the agent be appointed by the President of the Real Estate Institute of New South Wales or his or her nominee;
(b)Give such instructions to a solicitor to act on the sale of the property agreed upon in writing within fourteen days, and failing agreement as to the identity of the solicitor, the solicitor be appointed by the President of the Law Society of New South Wales or his or her nominee;
(c)Market the Suburb C property for sale by public auction at a reserve price to be agreed by the parties in writing and in the event of no agreement as determined by the auctioneer;
(d)Attend the auction and in the event that the reserve price set for the auction is not reached negotiate with the highest and second highest bidder and accept any offer to purchase that is the highest made within 5 per cent of the reserve price set for that auction unless the parties otherwise agree in writing;
(e)Execute the contract for sale and in the event that the parties fail to agree on the terms of the contract for sale, the terms recommended by the solicitor acting on the sale shall be adopted.
5.Upon the completion of the sale of the Suburb C property the proceeds shall be applied in the following priority:
(a)In payment of any outstanding land tax, council rates, and water rates;
(b)In payment of fees for the nomination of an agent or solicitor pursuant to these orders, if any;
(c)In payment of the real estate agent’s commission, selling expenses and auction expenses incurred on the sale;
(d)In payment of conveyancing legal costs associated with the sale;
(e)In the amount of 20 per cent of the remaining balance to the husband; and then
(f)In payment of the balance to the wife.
6.Pending the parties’ compliance with Orders 3 above the parties are hereby restrained by injunction from drawing upon or dealing in any way with their interest in the Westpac Bank Home Loan bank account #...54.
7.Pending the parties’ compliance with Orders 1 and 2 above the parties are hereby restrained by injunction from assigning, transferring, further encumbering or dealing in any way with their respective interests in the Suburb C property.
8.Save and except as provided for by these orders each party shall retain to the exclusion of the other all cash at bank, real property, furniture, motor vehicles, personalty, shareholdings, and superannuation entitlements in their respective possession or control as at the date of these orders.
9.In the event that either party fails or neglects to sign any document pursuant to these Orders, a Registrar of the Federal Circuit and Family Court of Australia (Division 2) is hereby appointed to execute such documents in the name of the party in default so as to give validity and operation to these Orders pursuant to s 106A of the Family Law Act1975 (Cth) upon being satisfied of such failure or neglect by way of affidavit evidence.
10.The Registry Manager is requested to forthwith forward a copy of these reasons to the Director, Legal Aid Commission of New South Wales.
11.In the event the Director, Legal Aid Commission of New South Wales files an Application in a Proceeding within 28 days of the date of these Orders, such Application is to be referred to the Chambers of Judge Murdoch and will be listed on short notice.
12.Except as provided for by these Orders, save as to costs, all extant applications are otherwise dismissed.
13.Should any party wish to make an application for costs of or incidental to these proceedings, they are to file and serve within 28 days of the date of these orders an Application in a Proceeding specifying the orders sought as to costs and any affidavit in support thereof. In the event of such Application being filed, Orders and Directions will issue from Chambers as to the listing of same.
14.In the event no application is made pursuant to Order 13 above, then all outstanding applications for costs are dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE MURDOCH
INTRODUCTION
The applicant wife and respondent husband are in dispute as to the adjustment of their property interests pursuant to section 79 of the Family Law Act 1975 (Cth) (“the Act”) following the breakdown of their marriage.
The parties are in substantial disagreement as to a significant number of factual issues. They agree that they commenced living together on the day they married in Country E, in 1985. Whilst both agree that the parties’ relationship was lengthy, they do not agree as to the date of separation; neither was able to adopt a consistent approach as to when they assert separation occurred.
There are two adult children of the relationship; Ms F and Ms G who are aged 34 and 23 years of age respectively.
The parties broadly agree as to how their property should be divided in specie. The issue is what sum, if any, is to be paid by the wife to the husband so that she may achieve the transfer in her favour of the husband’s interest in the only item of real property in Australia; the former matrimonial home at Suburb C, New South Wales.
Further substantial issue exists between the parties as to the nature and composition of the property pool with the wife contending that the husband has a legal interest in an enterprise that operates a business in Country E, the “[H Company]”. The parties’ respective contributions and the extent to which such contribution finding ought to be adjusted must also be determined. The wife contends that an adjustment should be made to the contribution finding in her favour as her contributions were made more onerous as a result of the husband’s conduct including the perpetration of family violence.
MATERIAL RELIED UPON
The parties were born in Country E and required both their written and oral evidence to be given via a Country E interpreter.
A direction was made at the commencement of the hearing that no annexures to affidavits or exhibited documents would be read in the matter until they were individually tendered.
In accordance with the Court’s directions, the parties prepared a Joint Draft Balance Sheet and a Joint Agreed Chronology and Statement of Facts.
The wife relied upon the:
·Outline of Case filed 12 August 2024;
·Amended Initiating Application filed 20 March 2024;
·Financial Statement of the wife filed 9 August 2024;
·Affidavit of the wife filed 9 August 2024;
·Affidavit of the parties’ eldest daughter, Ms F filed 10 August 2024;
·Affidavit of the “Area Chief” in Country E, Mr J filed 29 August 2023;
·Affidavit of the Husband’s younger sister, Ms K filed 29 August 2023;
·Penultimate paragraph only of the Affidavit of Mr L (being on page 48 of his report), a lawyer in Country E filed 14 August 2023; and the
·Affidavit of M filed 26 July 2023.
The Husband relied upon the:
·Outline of Case filed 16 August 2024;
·Amended Response filed 2 August 2024;
·Affidavit of the husband filed 8 August 2024;
·Financial Statement of the husband filed 2 August 2024 (“the Husband’s Financial Statement”); and the
·Affidavit of the husband’s elder sister, Ms N filed 12 August 2024.
BACKGROUND
The husband was born in 1957 and the wife in 1964 in Country E. They married in 1985 and commenced living together at this time. The date the parties separated is the subject of dispute.
The parties’ eldest daughter Ms F was born in 1990.
The parties’ youngest daughter Ms G was born in 2001.
In 2020 the husband’s son with his current wife Ms O was born.
The husband has nine siblings. Ms N, his eldest sister, was born in 1945 and lives in Country E. She gave evidence on behalf of the husband and was cross-examined.
The husband has a younger sister, Ms K, who lives in Australia. The husband refers to her as “Ms K” in his affidavit and I will refer to her as “Ms K” throughout these reasons. Ms K swore an Affidavit read in the wife’s case. She was not required for cross-examination.
The wife has a sister, Ms P. She did not give evidence in the proceedings.
The parties are the owners of the former matrimonial home at B Street, Suburb C (“the Suburb C property”).
It was conceded by the husband, only at the commencement of the final hearing, that he has a one-half interest in a parcel of land contained within Q Street, Suburb R, Country E (“the entire parcel of land”). [1] The entire parcel of land remains registered in the name of the husband’s father, who is now deceased. It comprises three undivided lots, all with buildings on them:-
·No 1: which has multi-storey building that has been used since it was completed to operate a business enterprise; H Company (“the Country E property”);
·No 2: comprising a house referred to as the “Country E House” by the wife; and
·No 3 and the land it is on: Ms N’s house.
[1] Exhibit WK.
The wife and husband paid for and built the business on Lot No. 1. A Judgment of Country E Court (“the Judgment”) dated early 2018 was entered into evidence at the urging of both the parties. In circumstances where the evidence of each of the parties and their supporting witnesses was confusing and contradictory, and different terminology was used throughout the proceedings to refer to the same parcels of land and buildings, I have read and relied upon the Judgement and the uncontested evidence of the wife to provide the following background:
·The husband’s father and mother were the registered proprietors of the entire parcel of land. The husband’s mother died without leaving a will.
·Some of the husband’s siblings live in Australia and the United States of America. The husband and Ms N are the only siblings that live in Country E.
·There was an assertion that the husband’s father had gifted Lot No 1 to the husband and Ms N and had drawn a will in 2010 to this effect. It was found that the father had drawn a will in 2011 dividing his property equally amongst his children.
·Some of the husband’s siblings commenced proceedings seeking to divide the entire parcel of land equally amongst all the siblings in accordance with the 2011 will.
·The husband’s father passed in 2012 whilst the proceedings were still on foot.
·The Country E Court determined that:-
·Whilst all of her siblings fled Country E, Ms N stayed and took care of her parents. She is the only person in the family who is single. Subsequent to the death of her parents Ms N cared for the property and paid the land tax to the government.
·The entire parcel of land left by the husband’s father and mother was to be divided equally amongst the siblings with Ms N receiving an extra portion; therefore the property would be divided equally into eleven parts, with Ms N receiving two parts.
·The husband and his sister Ms N have exclusive rights, as equal tenants in common to the Country E land and building on it referred to as “Lot No 1”. This is what is referred to as “the Country E property”.
·Ms N was to pay the wife the sum of approximately $73,000 AUD for her contribution to the erection of the building on the land. This amount was paid to the wife’s brother in Country E in late 2022 and he has been providing such funds to the wife as and when needed.
·Five of the husband’s siblings were to pay to the wife and husband the sum of approximately $22,000 AUD for their contribution to the erection of the Country E House.
Thus in total the wife received payments totalling $84,000.
The husband received a half interest in the Country E property and the sum of $11,000.00.
It appears to be uncontested that at some time the husband’s younger sister, Ms K transferred her entitlement in the entire parcel of land to the husband and Ms N for a sum of money from each. The sum of money paid is the subject of dispute. There being no assertion to the contrary, I have inferred that this transfer is incorporated in the agreed value of the husband’s interest in the Country E property.
The wife lives in Australia with the parties’ youngest child Ms G.
In 2022 the husband married his current wife, Ms O. She is 37 years of age. The husband lives in Country E with his current wife and their child in the building constructed for his father and paid for by monies lent by the wife’s sister, Ms P.
THE COMPETING PROPOSALS
The Wife seeks Orders on a final basis in accordance with the Final Minute of Orders attached to her Outline of Case filed 12 August 2024 that:-
·the husband transfer to the wife all his interest in Suburb C property to the wife;
·the wife retain the monies hold on the parties’ behalf by D Company; and
·the Wife otherwise retain all property in her possession, custody or control.
The Husband seeks Orders in accordance with the Orders set out in his Case Outline Document filed 16 August 2024 that:-
·the parties sell the Suburb C property and each receive one half of the proceeds of sale after payment of the costs of sale and outstanding utilities associated with the property;
·pending the sale of the property the wife be responsible for and pay any mortgage payments and utilities;
·each party otherwise retain all property in their possession, power or control and indemnify the other with respect to any liability standing in their name or attaching to any property they are to retain pursuant to the orders.
The parties agree that there remains a mortgage secured on the Suburb C property for a loan that has been paid out. The mortgage will need to be discharged. It is agreed that the husband will retain his interest in the real property in Country E. The wife seeks to retain the only real property in Australia, being the Suburb C property. The husband seeks its sale and equal division of the proceeds.
THE PARTIES’ EVIDENCE
I carefully observed each of the parties whilst they gave their oral evidence. I have taken into account that English is a second language for both parties and that both gave their evidence via an interpreter.
From her cross-examination it emerged that the Financial Statement filed by the wife did not record her true financial position as:-
·Contrary to the written assertion that she receives no income nor any financial assistance from the parties’ youngest child with whom she lives, the wife does receive financial assistance from her as they share a house. It was not asked of the wife the extent or nature of this financial assistance.
·Contrary to her Financial Statement but deposed to in a broad sense in her Affidavit, the wife has been receiving the sum of approximately $3,000 every two months from her brother in Country E over the last twelve months. The wife’s written evidence is that this money is from the $84,000 received by the wife pursuant to a decision made in her favour by the Country E Court recorded in detail in paragraph 20 of these reasons.
Despite the above inconsistencies, I find that the wife gave her oral and written evidence to the best of her ability in the circumstances as: -
·The wife’s affidavit evidence was otherwise not materially shaken in cross‑examination.
·For the most part, the wife was responsive to the questions that were asked of her in cross-examination; on the odd occasion that she did not answer the question directly she answered without hesitation when asked the question again. I am satisfied that this may have arisen due to the wife’s need for her evidence to be given via an interpreter.
·She did not equivocate whilst giving evidence and gave answers on occasion that may not necessarily have assisted her case.
The wife asserts that the husband has, throughout the proceedings, failed to provide a full and frank disclosure of his financial circumstances. The wife asserts that the husband:-
·has not disclosed the true nature of his interest in the enterprise that operates the business in Country E;
·until the first day of the final hearing did not disclose his real interest in the Country E property; and
·has not disclosed his true income and financial resources.
Even factoring in the husband’s reliance on an interpreter, I find that the husband’s oral evidence was less than satisfactory for a number of reasons. The husband was evasive and had to be reminded on no less than twelve occasions to answer the question asked of him. There were significant pauses prior to his answering simple questions capable of a simple self-evident response. I formed the view that the husband was attempting to formulate a response he perceived was most advantageous to his case. On some occasions after a lengthy pause, the husband would reply that he could not recall events despite them being significant or recent in nature. Important aspects of the husband’s financial circumstances only emerged at the commencement of the final hearing or during the course of cross-examination.
It was the husband’s case up until the commencement of the final hearing that he had no interest, legal or otherwise, in the Country E property; that it was the property of his sister, Ms N. His affidavit is replete with assertions that he does not officially own the land as it has not been subdivided as yet. At one stage he asserts that in any event the land has no value to him as it will remain in his family for use as a family prayer house to pay respect to elders in the future.
There is a long line of authorities setting out in clear and unequivocal terms the onus on parties to make a full and frank disclosure of all their financial circumstances: Black v Kellner (1992) FLC 92-287. The duty is absolute and is a continuing onus throughout the litigation process. It has been codified in Chapter 6 of the Federal Circuit and Family Court of Australia Rules 2021 (Cth) (“the Rules”). It is critical to the jurisdiction and is fundamental to achieving justice and equity as between the parties.
The husband conceded only at the commencement of the final hearing that, as asserted by the wife, he has a 50% interest in the property in Country E, being a parcel of land and building from which a business is currently operating. The husband’s prior denial of such interest was a calculated deceit.
The Financial Statement read by the husband for the final hearing records that:-
·His only income is investment income (from an undisclosed source) of $325 per week.
·He receives no other income or benefits.
·There are no other persons in his household.
·He has no weekly fixed expenses but his weekly expenditure totals $625. There is no particularity as to the composition of such assertion.
·The only real property in which he has an interest is his 50% interest in the Suburb C property.
·He has $3,826 savings in a bank account jointly held with the wife.
·He has a liability of $150,000 to one of his sisters; and
·He has no financial resources.
The evidence of the husband during cross-examination was that, contrary to his Financial Statement:-
·He lives with his current wife who does not work or receive any income. They live rent free with the husband’s sister in the property in Country E formerly lived in by his father.
·His living expenses are met by money lent to him by his sister of an unspecified amount.
·His sister paid for his travel to Australia for the final hearing.
Whilst the husband could not specifically recall whether he had read Rule 6.06, he was clear in his evidence that he was aware he is obliged to provide a full and frank disclosure of his financial circumstances to the court.
The affidavit verifying the Husband’s Financial Statement records:
(a)I have read Rule 6.06 and I am aware that by law I have an obligation to make a full and frank disclosure of my financial circumstances to the Court and each other party. In particular, I have disclosed in this document or in an affidavit filed by me or on my behalf under Rule 6.06(6), all matters I am required to disclose under Rule 6.06.
(b) The information in the financial statement and any attachments to it which are within my personal knowledge are true. Where I have given an estimate in this financial statement, it is based on my knowledge and is given in good faith. All other information given in this financial statement and any attachments is true to the best of my knowledge, information and belief.
(c)I have no income, property or financial resources other than as set out in this document or any affidavit filed by me under Rule 6.06(6).
At the bottom of the page underneath the affidavit, it is noted in handwriting that the document had been:
Translated into [Country E Language] and [Mr Asmar] confirm understanding of the content – [Ms U] *illegible*, interpreter
Upon review of the material filed to date, it does not appear the husband was represented for the filing of his initial suite of documents between 28 and 31 August 2023. His address for service of documents is his personal email address and an address in Country E. A Notice of Address for Service was filed on the husband’s behalf on 3 October 2023 by Selective Lawyers. A Notice of Ceasing to Act was then filed on 23 March 2024. The husband then remained unrepresented until 28 May 2024, when Sharah & Associates, his solicitors for the trial, filed a Notice of Address for Service.
I find that the husband was aware of his disclosure obligations, more likely than not from 3 October 2023 when he first became represented but at the very latest as and from 30 July 2024 when he affirmed his financial statement.
At no time has the husband filed an Undertaking as to Disclosure in accordance with rule 6.02 of the Rules, notwithstanding his legal representation. The Husband deposes that he has remarried, and he lives with his new wife. His current wife is not on Affidavit, nor is there any evidence as to her financial circumstances. Calls for the production of documents including the husband’s 2023 financial returns were not met.
In light of the husband’s own concessions during the course of cross-examination I accept and find that the husband has not disclosed his true financial position as he is mandated to do. In those circumstances, I find that the guidelines provided to trial judges to not be unduly cautious in making findings of fact in favour of the innocent party as identified by a range of cases considered by the Full Court including Black v Kellner (1992) FLC 92-287 and Weir v Weir [1992] FamCA 69 ought to be applied as against the husband. I further approach the husband’s evidence with some caution.
FURTHER CHRONOLOGY AND FACTUAL FINDINGS
The material and case presented by each of the parties did little to progress my capacity to be persuaded as to findings of fact in dispute between them that they viewed as required. Their respective evidence was self-contradictory and confusing. Propositions were put by counsel that did not accord with their own affidavit evidence. Having regard to the overarching purpose of the court to facilitate the just resolution of disputes as quickly, inexpensively and efficiently as possible pursuant to s 190 of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (“the FCFCOA Act”)and Rule 1.04 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) I have simply determined this matter as best I can on the limited persuasive evidence available. Each of the parties are bound by the case they ran at trial and the evidence they relied upon to support it, including omissions.
This matter is a salutary lesson for legal practitioners who draft affidavits for their clients to at least undertake some attempt at cross-checking the material and the assertions contained therein to achieve at the very least some basic consistency.
Each party prepared as directed a document as to the factual findings sought by them. The wife seeks no less than 75 specific factual findings be made and five general factual findings.[2] The specific factual findings sought by the wife are for the most part simply a recitation of her affidavit. The husband seeks approximately ten factual findings.[3]
[2] Exhibit W2.
[3] Exhibit H2.
The wife asserts in her Outline of Case that the parties separated on 30 March 2022. She deposes that this is the day she moved out of the former matrimonial home. In cross‑examination the wife asserted that the parties separated in mid-2000, and that it was the husband that ended the relationship, not her.
The husband deposes that the parties separated on 20 March 2012 yet also asserts that the parties were married for a period of almost 35 years, which would require separation to have occurred in 2020. His Outline of Case asserts a separation date of 15 September 2020. It was put to the wife in cross-examination that they separated in 2019. The wife’s evidence that the husband asserted in his Application for Divorce filed in March 2020 that the parties separated on 10 August 2018 was not the subject of challenge. The wife did not respond to such application.
The unsatisfactory evidence and contentions of each party does not permit a finding to be made as to the date of separation. There does not appear to be any dispute that the parties were in a lengthy relationship and the financial relationship of the parties is such that little turns on it. The husband’s Application for Divorce filed on 20 March 2020 was granted in late 2020. This would have required a finding to be made that the parties had separated for a period of no less than twelve months prior to the filing of the Application for Divorce. I find that the parties were separated no later than 19 March 2019.
Neither party owned any property of significant value at the commencement of their relationship.
Shortly after the parties’ marriage they left Country E and were in Country V for a period of time before coming to Australia in 1986. The wife asserts that the parties used their own savings to do so, whilst the husband asserts that this cost was met by monies received from the sale of a property held by the husband’s father in Country E and the husband’s savings. Neither party specified the costs of transporting the parties to Australia. Neither party has any independent evidence to support their assertions. I am unable to make a finding in this regard arising from the insufficient nature of the evidence.
The wife asserts that the parties commenced working from home as tradespeople in 1989/1990. The husband asserts this occurred from 1996. Whilst nothing turns on this factual dispute, the husband provides no evidence as to an alternative source of financial support during this period of time and I am satisfied on balance that the wife’s evidence is correct. Both parties agree that this ceased in 2009/2010. The wife was firm and unequivocal in her written and oral evidence that from 1989/1990 until 2009 she worked fifteen hour days, five days a week and I accept her unchallenged evidence. I accept the husband’s unchallenged evidence that the parties’ respective incomes from paid work was similar during this period, and their respective incomes were applied towards household expenses and outgoings.
The wife became an Australian citizen in or around 1991 and 1992. There is no evidence that the husband ever became an Australian citizen.
In 1995/1996 the parties purchased the Suburb C property as a vacant block of land for the sum of $100,000. They built a home on the property at a cost of approximately $180,000. This acquisition was funded by the parties’ savings and a loan from the Westpac Bank secured by way of mortgage against the property (“the Westpac mortgage”) for approximately $100,000.
By 2008 the parties had paid off the Westpac mortgage. At this time the husband ceased working as a tradesperson and commenced working in a factory.
The wife deposes that the parties had a conversation in 2009 wherein the husband told her that his father and his sister Ms N were getting old. If the husband were to build a business and run the business, he could live with his father and sister and look after them. “My father says the land will be mine once he pass, that means it will also be ours.” [4] The wife’s evidence that the husband sent her a photo of his father signing documents at an unspecified time which she believed to be an agreement and a will that would leave the land that the business was to be built on to the husband and his sister, and gift the parties approximately 100 square metres of land, was unchallenged and I accept that this was the wife’s belief.
[4] Wife’s Affidavit, paragraph 14.
The wife deposes that in mid-2009 the parties signed loan agreements to borrow $120,000 using the Suburb C property as security. The parties applied this money to start building a business on land owned by the husband’s father in Country E. The husband deposes that this occurred in “about” 2011 and was for the sum of $155,000. Tendered by the wife is a Westpac Bank Home Loan recording that the initial drawing of the loan of $120,000 occurred in mid‑2009 and accordingly I accept the wife’s evidence in this regard. [5]
[5] Exhibit WC.
In 2009 and 2010 the husband lived in Country E whilst the business premises was being built. The wife and children remained in Australia. It is unclear whether the husband was working at this time as he makes no mention of this period in his affidavit, though he states that until 2010, they both worked as tradespeople. In any event, the wife deposes, and I accept that while in Country E at this time the husband did not send any money to the wife for the payment of the mortgage or family expenses, so the wife continued to work and applied the income earned to same.
In late 2010 the loan secured against the Suburb C property was increased by $37, 800 to cover the costs of the business building. The wife further borrowed money from her sister, Ms P to build a house next to the business for the husband’s father to live in. The husband conceded in cross-examination that this equated to approximately $25,000 AUD, it was borrowed from Ms P and the wife subsequently repaid this sum.
The business premises was completed in late 2010.
From late 2010/early 2011 the wife lived in Country E and worked in the business. The wife deposes this arose as the husband advised her that he no longer wished to continue living in Country E. The husband’s evidence was that he wanted to return to Australia because he missed his children. He thus wanted the wife to stay and manage the business and she agreed. Despite the wife’s own written evidence, it was put to the husband in cross-examination that he “nothing short of ordered wife in [late] 2019 to stay and look after the business.” This assertion was not the wife’s evidence at any time throughout the proceedings. The assertion was denied by the husband. I cannot make a finding based on a proposition put to the husband that was not the wife’s own evidence. I accept and find that the wife agreed to live in Country E and manage the business to enable the husband to return to Australia to live with the children.
The wife lived in Country E from the end of 2010/early 2011 to 2022 and managed the business enterprise. It was the wife’s clear, unequivocal and unchallenged evidence that during the years she was working in the business in Country E she did not receive a wage, rather earnings from the business were paid into a bank account held in the name of the husband’s sister. The wife had authority to access this account.
The husband and children remained living in Australia and the wife travelled back to see them once or twice each year. During this time the husband was employed working at a factory. Both parties contributed towards the payment of the mortgage and household expenses. I accept the wife’s unchallenged evidence that during these years she worked long hours in the business; up to 16 hours a day, 7 days a week. During this time, as between the parties, the husband had the primary care of Ms G with the assistance of Ms F. The husband conceded that when the wife visited from Country E she would look after the girls and himself.
The wife deposes that up until the death of the husband’s father in 2012 she looked after him on a daily basis and tended to his needs including the provision of food, cleaning and “general well-being.” [6] The husband conceded in cross-examination that the wife assisted in the care of his father but asserted that his sister, Ms N, was the primary care giver. I accept and find that this was so because the wife conceded she did not live with the husband’s father; he lived with Ms N.
[6] Wife’s Affidavit, paragraph 26.
It was conceded by the husband in cross-examination that for a period of time after his father’s death the wife cared for his sister Ms N.
The wife deposes that in 2015/2016 the husband travelled to Country E without the children and commenced living there. The wife’s written evidence, which was not the subject of challenge, was that: -
·The husband told her at this time that he had retired as the business was doing well and he did not need to work.
·The husband has not worked since this time; he did not assist in the running of the enterprise in any way save for managing it when she returned to Australia annually for approximately one month to visit the children.
·The wife remained living in Country E and working in the business.
·The parties agreed that Ms F would assist with payment of the loan secured against the Suburb C property and would look after Ms G who was in Year 10 at the time.
·The husband had no savings when he returned to Country E to live. All his expenses were taken out as cash from the enterprise of approximately $2,000 per month.
Contrary to the wife’s written evidence, it was put to the husband that from 2018 – 2020 the husband went back to Country E to work in the business. The husband’s oral evidence was that he did not work, he simply went back to look at the way the wife ran the business. He thus supervised and did not work in the business as such. This evidence contradicts the husband’s own written evidence which deposes that: “From 2018-2020, I returned to [Country E] to work in the business.” [7] This assertion is contradicted by the husband in the same affidavit only three and four paragraphs later where the husband deposes:
For the period 2011 until 2022, I lived in Australia whilst [the wife] lived in [Country E].
During those years I was… responsible for the care of [Ms G] (from age 10-22 years of age), who was living with me in Australia whilst her mother lived in [Country E]. [8]
[7] Husband’s Affidavit, paragraph 32 (ii)
[8] Ibid, paragraphs 35 and 36
Grounded on the wife’s own proposition to the husband and his unchallenged response thereto, I find that it is more probable that the husband returned to Country E for the period 2018-2020 and during this period he undertook some form of supervisory role of the business, although the nature and form of this role is not the subject of any evidence. This finding is supported by the unchallenged evidence of the wife that in late 2018 the husband moved out of living in the business premises in Country E and commenced living in the Country E house with Ms O.
It is uncontested that in late 2017/early 2018 the wife applied $35,000 of her savings earnt from the business to payment of legal fees arising from the legal proceedings in Country E instituted by the husband’s siblings.
Whilst it is uncontested that the average income the business received for the years 2017 – 2019 was $60,000, it is unclear whether this refers to gross income or net profit. The husband notes in his written evidence that the profit was around $60,000 per year, but the wife asserts the 2018 – 2019 “income” was $56,602 and $60,924 respectively.
In early 2018 the Judgment was delivered with respect to the inheritance of land in Country E from the husband’s father.
In early 2020 the husband returned to Australia from Country E and filed an Application for Divorce. The husband was unable to return to Country E due to the COVID-19 pandemic lockdowns and lived in the Suburb C property with Ms G and Ms F. He was engaged in paid employment until mid-2022.[9]
[9] Exhibit J3
In late 2020 the husband’s Application for Divorce was granted, becoming final in late 2021.
The COVID pandemic lockdown in Country E was from early 2020 to early 2022. During this time the business enterprise was shut down and the wife no longer had a source of income. The wife continued to maintain the business and was reliant upon her family in Country E for financial assistance. The wife’s evidence that during the COVID lockdown neither party contributed to the loan payments as there was no income from the business is uncontested and I so find.
The wife continued working in the business once restrictions were lifted and commenced receiving financial benefits from the business enterprise again from approximately early 2022, though the nature and extent of such benefits are not in evidence.
In early 2022 the wife moved out of the business premises at the request of Ms N and Ms O and lived with her mother in Country E for a short period of time.
In 2022 the husband married his current wife, Ms O.
The wife acknowledges she received almost $11,000 of the judgment monies in July 2022. It was unchallenged that the wife applied these monies towards financially supporting Ms G by way of a $600 - $700 payment each month. The wife believes that the husband too received the $11,000.00 payment. The husband is silent as to the receipt or application of such funds.
Upon the husband’s return to Country E in mid-2022, he tenanted out the Suburb C property for the sum of $700 per week. The husband deposes that 100% of this sum was applied to the mortgage payment of $500 per month and other outgoings including council and water rates. There is no evidence as to whether the rental monies covered all such outgoings or whether there were excess funds after payment of same.
In mid-2022 the wife returned to Australia to live with Ms F and her husband in their home. She has not been to Country E since this time.
In late 2022 upon attending at the home at Suburb C the wife realised that without her knowledge it had been tenanted by the husband.
The wife commenced these proceedings on 13 December 2022.
In late 2022 a Country E Court made enforcement orders that the husband’s sister, Ms N pay to the wife a sum for 50% of the costs of building the business premises on the land in Country E. The wife received payment of $84,000 in late 2022. The wife clarified her evidence in cross-examination, estimating that “nearly all of it” has been spent on legal fees and there is now only approximately $3,000 remaining.
In approximately mid-2023 the wife moved out of her eldest daughter’s home and moved into a rental property with her daughter Ms G.
In early 2024 the loan secured by way of mortgage against the Suburb C property was paid out but has not as yet been discharged. Upon the loan secured upon the property being paid in full the parties arranged for the rental monies to be paid to the managing agent of the property, Mr X. This is item 12 on the Balance Sheet.
I am unable to make a finding as to when the husband permanently relocated back to Country E to live with Ms O due to the contradictory unchallenged evidence in this regard, save for that it was no later than late 2023.
The wife deposes that the tenants in the Suburb C property vacated the property earlier than the lease agreement ending in mid-2024. Without her consent, the agent provided the keys to the home to the husband and he has been staying there since some time before mid-2024. The wife remains in rental accommodation with Ms G at the cost of $300 per week.
THE STATUTORY REGIME
In determining claims for alteration of property interests pursuant to s 79 of the Family Law Act 1975 (Cth) (“the Act”), I am required to:
·Make findings as to the identity and value of the property, liabilities, and financial resources of the parties, or either of them, at the time of the hearing and determine the legal and equitable interests of the parties in such property;
·Consider, identify and assess the contributions by the parties to the acquisition, conservation and/or improvement of their property, including financial and non-financial contributions and any contributions to the welfare of the family before, during and after the relationship came to an end;
·After consideration of altering the interests in the property pool on the basis of contributions, to consider whether there should be any further adjustment to either of the parties on account of the matters set out in s 79(4)(d)-(g) of the Act, including any relevant considerations pursuant to s 75(2) of the Act; and
·Ensure that the orders to be made are just and equitable in all the circumstances.
BALANCE SHEET FINDINGS
Grounded from the draft Joint Balance Sheet and the concessions made by the parties during the hearing and doing the best I can on the material available I have constructed the balance sheet comprising the property of the parties. The disputed items and their asserted values are in bold font. I have rounded figures to the nearest dollar value, adopted the same terminology used by the parties and used the same numerals for each item on the parties’ draft balance sheet to avoid further confusion.
Ownership Description Applicant Value Respondent Value ASSETS 1 Joint B Street, Suburb C New South Wales $950,000 Agreed 2 Husband Interest in the business land in Country E Conceded $259,607 3 Husband Interest in business building in Country E Conceded $181,772 4 Husband Country E business (goodwill) – H Company $300,000 Nil 5 Husband Country E Business Internal commercial equipment/assets of the $200,000 Nil 6 Wife Westpac Bank Account Not Agreed $172 7 Wife Mr Y – Brother Not Agreed $3,000 8 Joint Westpac Bank Home Loan Account #...54 $3,826 $3,826 9 Wife Household Contents E$1,000 $1,000 10 Husband Household Contents - $1,000 12 Joint D Company - Rent Held on Trust $6,912 $6,912 Total $1,903,117 $1,407,289 NOTIONAL ADDBACKS Ownership Description Applicant Value Respondent Value 11 Husband Superannuation (early release by Husband) $12,000 Nil 13 Wife Monies received by Wife Pursuant to Judgment
Country E CourtNot Agreed $81,000 Total $12,000 $81,000 LIABILITIES Ownership Description Applicant Value Respondent Value 15 Joint Westpac Mortgage over Suburb C Nil Nil 16 Wife Loan from Daughters and Siblings for legal fees $50,000 - Total $50,000 $0 FINANCIAL RESOURCES Ownership Description Applicant Value Respondent Value 21 Husband Country E Business Revenue NK - Total NK - NET TOTAL ASSETS $1,865,117 $1,488,289 Items 1 - 12: Assets
Item 4: Country E Business (goodwill) H Company (operated on H Company Land) and Item 5: Country E Business Internal Commercial Equipment/Assets
By way of her Outline of Case the wife initially asserted that the husband will be able to earn an income from the business. During the course of the final hearing the wife contended, through counsel, that:
...the business (including the undertaking, stock, plant and goodwill) conducted in the [business] in [Country E] is the sole and absolute property of the wife and the husband.[10]
[10] Exhibit W2, page 7.
The wife asserts that Ms N has no interest in the “business”. Counsel for the wife was clear in his opening submissions to the court that the wife does not contend that the husband or wife has any form of equitable interest in this financial entity, they are the owners of the business in its entirety and Ms N has no interest at all. Counsel was not able to advise at this time the nature of the vehicle that conducts the trading enterprise known as H Company, whether it be a corporation, partnership or some other vehicle but later stated that it was an informal, familial arrangement. The wife seeks a factual finding that the financial enterprise conducting the business in Country E has a value of $500,000 and/or that the wife was prevented by the husband from undertaking a formal valuation of the stock, plant and equipment. The value asserted is simply an estimation by the wife. The wife submitted that the court could make a finding that there is equipment and property but the husband has not disclosed it: “we have nothing because the husband hasn’t told us anything.”
It is the husband’s case that he has no interest in this entity that operates the business and it is owned by his sister. In any event, irrespective of any finding as to who owns the business, there is no evidence as to the value of such business. He submits that there is no question that the husband and wife operated the business, but they were never the owners and there is no evidence to ground a finding that they are. The husband further submitted that there is no evidence that he was receiving any revenue from the enterprise.
The evidence as to the financial arrangements with respect to this financial enterprise was not illuminating.
There is no dispute that during the course of the parties’ relationship (and potentially post separation) the husband lived in Country E for a period of time to oversee the construction of the H Company building. Subsequent to its completion the wife lived in Country E and worked in the business, though the nature of the tasks she performed was not the subject of any satisfactory or detailed evidence. Her answers in cross-examination were of little assistance, but notwithstanding such limitation she was not pressed further on the subject:
COUNSEL: Is it part of your case that in those years that you worked in the [business] you worked very hard?
WIFE: Yes.
…
COUNSEL: Perhaps I can rephrase the question - that you found work to be difficult?
WIFE: It was very difficult but I had to bear it.
COUNSEL: What were some of your duties of employment – sorry, your duties of work?
WIFE: There were lots of little jobs in there, everything, every job in there.
It was the wife’s oral evidence that the revenue received by the wife from working in the business went into a bank account in Country E in Ms N’s name, who gave the wife authority to put money into the account. There is no specific written or documentary evidence as to how monies were paid to the wife from the business. Her oral evidence was that although she did not receive a wage as she was not an employee, she nonetheless had authority to the bank account which received the profits. There are no taxation returns, revenue returns or bank account statements before me in evidence. During the course of cross-examination, the wife replied in the affirmative when asked if “the sister” was effectively the owner of the business.
In evidence is a certificate of Business Registration and Tax Registration for Private Business which records: -
The name of the company in [Country E]: “[…]”
The name of the company in English: [H Company]
Industries:
Business Code […]
Trading in [products] Code […]
Trading in [products] Code […]
The owner: [Ms N], date of birth […] 1945
Though denying the proposition initially, the husband eventually conceded in cross‑examination that Ms N was registered as the business owner as the husband and the wife, having left Country E, were foreigners and could not own a business in their own right at the time.
In cross-examination the husband asserted, when asked if it was his case that he and the wife put all of the money into the construction of the business premises just to establish a business for someone else, that: “after building he would let my wife and I run the business. He would not take money out of the business.”
It was the husband’s response to questions asked of him in cross-examination that it was the wife that ran the business, that he did not receive any money from it and that any monies received were totally controlled by the wife.
It was put to the husband on numerous occasions in a myriad of ways that the husband was the true “owner” of the “[business]”, including as below:
COUNSEL: Well you own the [business] don’t you?
HUSBAND: I don’t have any documents that say that I am.
…
COUNSEL: So he’s got no documents he says that says he’s the owner of the [business]?
HUSBAND: No I don’t have.
It appears that Counsel and the husband are at cross purposes with these sorts of questions. The husband is not as yet the registered owner on the title to the Country E land. In any event, the husband categorically denies that he receives any benefit from the monies received by the business, other than his sister using such funds to lend him money for his living expenses.
The husband conceded that it was his signature on a document dated “Application to Get Confirmation” dated early 2018. This document records that:
At the moment, I am running a business namely [H Company], address [Z Street, Suburb AA, City T].
By this application, I request the Police Officer […] to confirm about the period of time that I have been living in this area, running directly a business namely as above‑mentioned [H Company], from year 2016 till now.[11]
[11] Exhibit WL.
It was again unfortunate that nothing further was asked of the husband after this concession was obtained. Prior to this, the husband denied that such document was an application to enable him to pursue a further application for him to be on the certificate of title “of the [business]”. I am unsure if this question was referencing the land on which the business structure was situated, or a reference to the H Company business. The husband asserted that the identical application made by the wife was simply to confirm that she was the one that ran the business. This assertion was not put to the wife.
In cross-examination the husband conceded that he advertises for H Company on social media which includes photographs of the interior of the business and the company name. [12] He conceded that his current wife, Ms O, has social media which depicts a photograph of the entrance of the business. This photograph has Ms O’s name, the name of the business and a barcode that can be scanned. Upon scanning the barcode, Ms O’s name would come up as the person who was to receive the money. This directly contradicts Ms N’s evidence in cross‑examination that the revenue from the business does not go into Ms O’s account.
[12] Exhibit W3.
It was the oral evidence of both the husband and Ms N that Ms N does not pay any rent to the husband for her use of the Country E property to operate the business. They both appeared to be perplexed as to why Ms N would pay rent: “I don’t pay rent why do I have to pay that when I am the owner of the [business].” The husband asserted that if he was going to charge someone to rent the property it would be at approximately $12AUD a day, despite being aware that Ms N charges a significantly higher rate.
Towards the end of his cross-examination it was clearly put to the husband that he is the owner of the business operated in Country E to which he denied. It was clearly put to him that he has substantial money and financial resources that he has not disclosed to the court which he denied.
Ms N deposed that she acquired the business from her father with the husband and the wife, and that they built the business from the ground up in 2010 and 2011. When this evidence was put to the husband, he stated he “didn’t know about that.”
The wife deposes that a loan of $120,000 was obtained with the employment of the Suburb C property as security. Ms N deposes that the husband and wife contributed $155,000 and that “we” obtained a loan from Westpac. The husband conceded that it was not in fact the case, that Ms N was not a party to the loan. I do not place significant weight on her written evidence.
The evidence with respect to the financial enterprise operating out of the building, which the husband only conceded on the first day that he had a legal interest in, is wholly unsatisfactory. There are few documents in evidence and none as to the financial dealings of the trading enterprise. The Business Registration and Tax Registration for Private Business records that it is Ms N who operates the enterprise.[13] The husband and the wife have asserted on occasion in the past that they ran the enterprise, but such claims are not verified by current documents or any documentary evidence before me.
[13] Exhibit HF.
I am not satisfied on the evidence that the wife has met her evidentiary burden to ground a finding that the parties have a legal interest in the trading entity. Even if I were to so find, the value of such interest is unknown in circumstances where the valuer was unable to obtain access to value same:
[AB Company] does not calculate and record the current value for the interior equipment of the [building, Lot No 1] which is used for the [business]’s commercial operations due to the unacceptance to enter for this survey.[14]
I cannot accept as a value an estimation of the wife as sought.
[14] Affidavit of Single Expert Valuer page 48.
The wife did not assert the parties had any equitable interest in the trading entity. Her counsel submitted that the parties’ interest was a legal interest.
I am satisfied however that the findings as to the husband’s disclosure failures on this subject matter permit a robust finding to be made that this entity is a financial resource for the husband; he receives a financial benefit from it although the nature and extent of the financial benefit received by the husband and/or his current wife receives is unknown. This finding is open as:-
·The husband receives unknown and unquantified financial support from the business;
·The husband and Ms O advertise the business on social media;
·Ms O is the person who receives monies through the social media app for bookings arranged through that source;
·The evidence of the husband and his sister is contradictory and unsatisfactory;
·The husband does not charge Ms O any rent for the use of the building; and
·It is implausible that the parties would apply money into it and work in it for no money unless they had an interest.
The quantum and value of this financial resource is unknown as a consequence of the husband’s failure to provide a full and frank disclosure of his financial circumstances. Such failure to disclose will be robustly considered in the adjustment to contribution findings pursuant to s 75(2)(o) of the Act.
Item 6: Wife’s Savings in Westpac Bank Account
The wife asserted that these savings should not be on the Balance Sheet. No submissions were made as to why. The item will remain.
Item 7: Balance of Monies Remaining from the Country E Court Judgment
The wife submits that this figure should be “disregarded.” No submissions were made as to why. The item will remain.
Item 10: Household Contents of the Husband
The husband asserts the value of $1,000. The wife makes no assertion. There is no valuation. I accept the husband’s concession and find this item has a value of $1,000.
Items 11 and 13: Notional Add Backs
Both parties seek that monies received and spent be notionally added back to the property of the parties and credited against the other’s entitlement to existing property.
The Full Court in Omacini & Omacini [2005] FamCA 195, identified three clear categories where it may be appropriate to notionally add back an item of expenditure:
·where the parties have expended money on legal fees;
·where there has been a premature distribution of matrimonial assets;
·where there has been a waste, reckless, negligent or wanton dissipation of assets as outlined by Baker J in Kowaliw and Kowaliw [1981] FamCA 70.
Notionally “adding back” items to the asset pool is a discretionary exercise which ought to be the exception rather than the rule.[15] Thus the party seeking the notional add back bears the onus of persuasion. As stated by the Full Court in Trevi & Trevi [2018] FamCAFC 173 at [30]:
…When the discretion is exercised in favour of adding back, it reflects a decision that, exceptionally, in the particular circumstances of a case, justice and equity requires it. The second premise is its corollary: in cases that are not “exceptional” justice and equity can be achieved, not by adding back, but by the exercise of a different discretion — usually by taking up the same as a relevant s 75(2) factor. Indeed, it has been said that the latter is “a course which is, perhaps, technically more correct” than adding back to the list of existing interests in property.
(Footnotes omitted)
[15] Chorn v Hopkins [2004] FamCA 633.
Parties are entitled to reasonably conduct their affairs post separation.[16] Reasonably incurred expenditure usually does not come within the accepted categories of a notional add back.
[16] Gollings & Scott [2007] FamCA 397.
Item 11: Superannuation Monies Released to the Husband
The explanatory notes accompanying the Balance Sheet record that the Husband’s affidavit of 9 October 2023 deposes that the husband withdrew an estimated $14,000 of superannuation in or around September 2023. This affidavit was not relied upon by the wife. The husband, via his counsel, did not concede this fact. The husband was asked no questions, it appears because the wife thought that this fact was conceded. The wife did not seek to re-open her case. I have no evidence before me as to this item and its inclusion on the balance sheet is rejected.
Item 13: Monies Received by the Wife
The husband seeks that a sum of $81,000 be credited against the wife’s entitlement to existing property being monies asserted by him to have been spent by the wife on legal fees.
The wife received $84,000 in total as a result of the Country E Court Decision. She deposed that she has been using this money to fund her legal fees, rent and other daily living expenses. In cross-examination the wife was asked how much she has spent on legal fees and the answer was: “nearly all of it, there is only about $3,000 left.” The wife’s Cost Notice is not in evidence. Where the wife’s oral evidence was given via an interpreter and considering her response to the question, I am not satisfied that I can make a positive finding that the wife has expended the entire sum of $81,000 on legal fees. I am satisfied and find that the wife has expended all but $3,000 on her expenses including the payment of legal fees.
Whilst paid legal fees occupy a particular position by reason of s117 of the Act, the treatment of funds used to pay legal fees is ultimately a matter of a discretionary consideration of the interests of justice in the circumstances of a particular case: Oamra & Williams [2021] FamCAFC 117; (2021) FLC ¶94-035 at [110].
The husband has had private legal representation at some stages throughout the proceedings and it is conceded that he has paid $8,000 in legal fees. Those funds expended are not sought to be added back. The husband had, even though he lives in Country E, legal representation for trial preparation and final hearing at no cost to him pursuant to the Commonwealth Family Violence and Cross-examination of Parties Scheme. This arose from the wife’s allegations as to the husband’s perpetration of family violence including physical assaults.
It would be unjust having regard to those circumstances to have monies expended by the wife (of an unknown quantity) credited against her entitlement to any property adjustment and this addback is rejected. Such monies received and expended by the wife and husband will be considered pursuant to s75(2)(o) of the Act.
Items 15 – 16: Liabilities
Item 16: Loan from Daughters and Siblings for Legal Fees
The only evidence as to any loan obtained by the wife to fund her legal fees is in her financial statement which records the wife as the borrower of $50,000 for legal fees from an unnamed lender. There is no evidence as to the source of funds borrowed, or the terms of such borrowing. The evidence does not ground a finding that such a liability exists. In any event, the monies expended by the parties on legal fees are not notionally added back to the pool of property available for distribution for the reasons set out above. It would be unjust to have this asserted liability on the balance sheet. This item is rejected.
Item 21: Financial Resources
Country E Business Revenue
I am satisfied for the above reasons that the husband has the benefit of monies from the financial enterprise that operates the business. Its value is unknown and will be taken into account pursuant to s 75(2)(o) and thus it will not be recorded on the balance sheet.
Accordingly, I find that the property pool consists of assets and liabilities as follows:-
Ownership
Description
Value Found
ASSETS
1
Joint
B Street, Suburb C New South Wales
$950,000
2
Husband
Interest in the H Company land in Country E
$259,607
3
Husband
Interest in H Company building in Country E
$181,772
7
Wife
Monies remaining from Country E Court Judgment
$3,000
8
Wife
Westpac Account savings
$172
9
Joint
Westpac Bank Home Loan Account
$3,826
10
Wife
Household Contents
$1,000
11
Husband
Household Contents
$1,000
12
Joint
D Company – rent held on trust
$6,912
NET TOTAL ASSETS
$1,407,289
I find that the value of the parties’ property is $1,407,289.
The total value at law of property held by the wife prior to any adjusting order is $484,541.
The total value at law of property held by the husband prior to any adjusting order is $922,748.
WHETHER AN ORDER ALTERING PROPERTY INTERESTS SHOULD BE MADE
I should only make orders pursuant to s 79 of the Act if I am first satisfied that it is just and equitable to do so. It must not be assumed that the parties’ rights or interests should be different to that which already exists: Stanford & Stanford [2012] HCA 52 (“Stanford”).
I find that the requirements identified in Stanford are satisfied in this matter having regard to:
·The parties in this matter, having married and mixed their finances as a family, have now separated. It is therefore not possible for them to continue to mutually enjoy the accumulated assets.
·Both parties invoke s 79 of the Act seeking orders for property settlement.
·The current legal interest of the parties needing to be changed or adjusted when consideration is given to the contribution and other factors identified below.
It is therefore just and equitable in all the circumstances to make orders pursuant to s 79 of the Act adjusting the financial interest of the parties.
THE ASSESSMENT OF CONTRIBUTIONS
Both parties had nominal property at the commencement of the relationship. From the time they arrived in Australia until 2010 both parties were engaged in paid employment and contributed to the household expenses including the deposit for the Suburb C property and thereafter the loan repayments to the best of their respective abilities.
The husband conceded that up to the end of 2010 the wife was the primary caregiver and homemaker for the children and himself, undertaking homemaking tasks including cooking, ironing and undertaking household chores.
For periods of time each of the parties lived in Country E to advance the families’ financial prospects whilst the other remained living in Australia, working and caring for the children. Again, each party contributed in their respective roles as arranged between them to the best of their ability. I have found that whilst in Country E the wife assisted in the care of the husband’s father and eldest sister.
In early 2018 the husband received judgment as to his entitlement to the Country E property. Whilst this particular parcel of property was received by way of inheritance as a result of the parties’ construction of a building on it and savings accumulated from monies received from the trading enterprise paid the legal costs arising from this litigation, this inheritance was in effect a springboard to the parties’ property in Country E and weighs in the husband’s favour.
The wife submits that the court should disregard the $150,000 the husband asserted he owes to his sister. There are no documents to support any asserted loans. The husband himself concedes that it is unrealistic to submit that the monies will ever be paid back and that this should therefore be seen as a contribution made by the husband. There is no independent evidence to support the advance by a sister to the husband of a sum of $150,000. I do not accept that the husband has established to the requisite degree the existence of the advance of any such monies.
In 2018 the husband returned to Country E to live for a period of time. The wife continued working in the business while the husband undertook some form of “supervisory” role for a period of approximately two years. Ms G was cared for in Australia by Ms F who thus undertook the primary responsibility as caregiver and homemaker in Australia during this period. There is no evidence as to the parties’ living arrangements during this time and I am unable in those circumstances to make any findings with respect to any non-financial contributions made.
The Husband was engaged in paid employment from 2020-2022 in Australia. By this time both children were adults. The wife remained in Country E during this period maintaining the business during the COVID 19 lockdown period. She received financial assistance of an unspecified nature and sum during this period from her family in Country E.
The wife ceased paid employment in early 2022. I find in accordance with the parties’ agreed position that the husband ceased paid employment in mid-2022.
The wife contends that an adjustment should be made to the contribution finding in her favour as her contributions were made more onerous as a result of the husband’s perpetration of family violence including coercive and controlling behaviour in accordance with the principles identified in Kennon v Kennon (1997) FLC 920-757.
The wife broadly asserts that the husband beat and verbally abused her throughout the relationship. Apart from this broad and generalised assertion she particularises three specific incidents of physical and verbal abuse as recorded below.
The wife deposes that in 2018 whilst in bed the wife asked the husband to leave his girlfriend at the time, Ms O. The husband refused, telling the wife that he was going to marry her. He then “turned around and started strangling me.” The wife broke free and ran to the police station bare foot. They allegedly refused to help her or make a record as she was regarded as a foreigner. In cross-examination the wife asserted that this incident occurred in early 2018 and that the Police did write down her name but said they could not resolve the issue. She denied the broad proposition put to her that this incident did not occur. She asserted that she went to the police station by herself. The question asked of the wife as to any attempt to subpoena documentation of this report is unfair in the circumstances where the alleged incident occurred in Country E and the wife has not been in that country since mid-2022.
The husband conceded in cross-examination that this conversation occurred but denied that he attempted to strangle the wife. He denies that he assaulted in any way the wife causing her injuries. The husband stated that the wife asked him to go to the police station with her.
The wife’s evidence as to this alleged incident was detailed. She was firm and unequivocal in her oral evidence that this incident occurred. No explanation was given by the husband as to why the wife wanted the husband to attend the police station with her on this date. I am satisfied to the requisite degree that this incident occurred as alleged by the wife and I so find.
The wife deposes that in late 2018 the husband tried to hit her face so she crouched into a foetal position to protect it. The husband proceeded to dig his fingers into the back of her shoulder and ripped her skin, requiring her to see a doctor and receive treatment at a hospital. In cross‑examination the wife gave evidence that she provided the medical records with respect to this incident to her solicitor. Again, a broad proposition was put to the wife that this never occurred. She was firm and direct in her evidence that it did. In re-examination the wife gave evidence that a document shown to her was the hospital records she was referring to in cross‑examination. Such records are in Country E Language, however the wife deposed that they record the name of the hospital she attended, her attendance in late 2018 and the medicines she was prescribed.
In cross-examination the husband conceded that “I did give her some warning.” This answer was not explored any further by counsel for the wife. The husband further conceded that the wife curled up in a foetal position but denied that he hit her on the body.
I am satisfied that the wife’s detailed evidence which was not shaken in cross-examination and the husband’s concessions as to some of his actions on this date ground a finding that the husband assaulted the wife on this date as alleged by her and I so find.
The wife deposes that in approximately early 2019 the husband started yelling at her whilst she was working in the business in Country E. He then started grabbing her hair and hitting her with an open hand and kicking her with his foot, causing bruises. She asserted that she had a video of such event, though none was tendered. I can only infer from the failure to tender such material that it would not have assisted the wife. The wife denied the proposition put to her in cross-examination that the husband did none of these things.
Contrary to the proposition put to the wife in cross-examination that the husband “did none of those four things that you allege in your affidavit”, the husband conceded in cross-examination that he had yelled at the wife.
I am not satisfied in circumstances where the wife failed to rely upon independent and corroborative evidence that the wife has discharged her evidentiary burden to the requisite standard that would allow me to make a finding that the husband physically assaulted her as alleged on this occasion.
The wife submits that the husband used fear and violence to control her throughout the marriage so that she would acquiesce to his demands. The example provided by way of her Outline of Case and put to the husband in cross-examination was the wife remaining in Country E away from the children to run the business. The highest the wife’s written evidence in this regard is that when the husband attended Country E for the grand opening of the business, he sat her down with his father and sister and was crying and said: “I can’t live here anymore. I don’t think I am capable of running the business. I’ve already booked a flight back to Australia in two days, please let me go home.” The husband then told his father and sister that the wife would remain and run the business. The wife deposes that she was surprised as she had not planned on staying in Country E but as they had so heavily invested in the business she felt she needed to stay and make the business work. It was put to the wife in cross-examination that the husband never said these words and she affirmed that he had. No alternate version of events was put to the wife in cross-examination.
I am not satisfied on the wife’s own evidence that this amounted to a course of coercive and controlling conduct.
The parties’ daughter Ms F deposes that from the age of 8 years she would hear her parents arguing and her father yelling, swearing and making threats which would:
…usually be along the lines of:
‘I’m going to kill you’
‘I’m going to hurt you’
‘I’m going to hurt your family”.[17]
[17] Affidavit of Ms F, paragraph 8.
Ms F further deposes that she would “often” see bruises on her mother after hearing her parents arguing and fighting.
In cross-examination it was put to Ms F that she never heard her father making threats nor witnessed her father hitting her mother. She was firm in her evidence that she did hear her father make those threats. She stated that she never witnessed her father hit her mother but saw the aftermath of his actions.
I am not satisfied that I can make a broad finding that the father perpetrated violence on the mother as alleged by Ms F as her evidence does not support any evidence given by the mother herself. It would be unsafe for me to find a causal link between her observation of bruising on the mother at unspecified times and the perpetration of physical violence by the father.
The principles relevant to an assessment of contributions in the context of allegations of family violence were set out in Kennon v Kennon (1997) FLC 92-757 (“Kennon”) where, at 84,294 the Full Court stated:
Put shortly, our view is that where there is a course of violent conduct by one party towards the other during the marriage which is demonstrated to have had a significant adverse impact upon that party’s contributions to the marriage, or, put the other way, to have made his or her contributions significantly more arduous than they ought to have been, that is a fact which a trial judge is entitled to take into account in assessing the parties’ respective contributions within s 79.
I have made findings as to the perpetration of family violence by the husband upon the wife on two occasions as recorded above. Counsel for the husband submitted that even if the court found the husband had perpetrated family violence, there is no evidence that it impacted the wife’s ability to make contributions.
The wife deposed to only three instances and the alleged incidents occurred within a short space of time. The wife conceded in final submissions that on the evidence there would be difficulty in finding a causal link between the husband’s alleged conduct and her contributions being made more onerous. It was submitted however that the demands made by the husband of “I want 50%” and depriving her of the ability to contribute to the parenting of the children is an abusive situation.
The evidence adduced by the wife did not expressly identify how the husband’s conduct made her contributions more onerous or more arduous. Whilst that impact can be inferred from the weight of the overall evidence (Boulton & Boulton (No 3) [2024] FedCFamC1F 269), such an inference is not available on the evidence in this matter. The wife’s contention that an adjustment to the contribution finding ought to be made in her favour arising from the alleged conduct of the husband must fail.
The husband has at all times been housed in properties owned by the parties or provided to him by his family at no cost. This includes a period of time from mid-2024 where the husband has been living in the Suburb C property whilst the wife remains living in rental accommodation.
Both counsel made submissions on a global approach as to contributions applied to a single pool of property and I am satisfied having regard to the length of the relationship and the composition of the property pool that this approach is appropriate.
The Full Court in Horrigan & Horrigan [2020] FamCAFC 25 reinforced the holistic approach espoused in Fields & Smith [2015] FamCAFC 57 and stated that the proper approach to the assessment of contributions is:
[35] …established that an assessment of contributions is not a mathematical exercise, but rather involves the identification and assessment of all of the parties’ respective contributions, in a holistic way across the course of the relationship and in the post separation period to the point of assessment…
The wife submits that a contribution finding should be made in the wife’s favour of 60% in circumstances where she asserts that: -
·The financial contributions of the parties were about equal until the husband retired in 2015. The wife has made a greater financial contribution since his retirement.
·The wife made a significantly greater contribution to the welfare of the children from mid-2009-late 2010 when the husband lived in Country E.
·There is no evidence from the husband about his contribution as a parent.
·The wife made a significant contribution to the welfare of the husband’s father and sister.
·The wife’s contributions were made more onerous as a result of the husband’s conduct.
The husband submits that both parties worked hard during the relationship. A holistic assessment having regard to the length of the relationship of approximately 34 years would lead to a contribution finding of equality save for:
·The husband’s initial contribution via his father, which I have made no finding about.
·The husband’s inheritance of the land in Country E obtained through his father’s estate. This was in effect a springboard that permitted the parties to then contribute to the construction of the H Company building which is thus a greater contribution by the husband. The husband submits that the contribution finding should be 58% in his favour.
This is a lengthy relationship. As recorded above, both parties made significant financial and non-financial contributions throughout the relationship. Whilst the land on which the parties constructed the building currently used to operate a business was an inheritance received by the husband, legal fees were expended by the parties to receive such inheritance and the specific inheritance received arose from the parties’ expending both monies and their efforts to construct the building on it. In those circumstances the inheritance received by the husband weighs in his favour, though not significantly.
Adopting the same holistic approach as that adopted by the parties, which requires all contributions to be weighed collectively, and considering all the contributions recorded above I assess the parties’ contributions to the property pool as 45% to the wife and 55% to the husband. This equates in dollar terms to the wife receiving $633,280 and the husband receiving $774,009. By way of cross check, this is a disparity between the parties of $140,729.
ADJUSTMENT TO THE CONTRIBUTION FINDINGS
The wife submits that an adjustment to the contribution finding of 10% should be made in her favour. The husband submits that an adjustment of 3.5% should be made to the contribution finding in his favour as he has the financial responsibility of a four-year-old child.
The husband concedes that he is living rent free and has financial support from family members however the wife also obtains support from family members. Counsel for the husband submitted that I would not find non-disclosure to be relevant to this case:
I don’t think overall it’s a material issue that Your Honour has to consider that his non‑disclosure at any level would be relevant to this case.
I reject this submission. The husband’s failure to disclose his true financial position is clearly relevant in this matter.
By way of the contribution finding the husband will have the benefit of $140,729 greater property than the wife.
Both parties are 60 years of age.
The wife is currently not working. She is not in receipt of any Centrelink benefits and is reliant upon the monies she receives from her brother and contributions towards expenses from her daughter Ms G, with whom she shares a home. She contributes $300 per week in rent. She deposes as to feeling stressed and anxious about these proceedings and has been attending upon a psychologist to assist her. The wife does not depose as to her plans to obtain any paid employment in the future.
The husband deposes that he is not engaged in paid employment. He conceded during the course of cross-examination that there is no reason why he could not be in paid employment as there is nothing that prevents him from doing so.
The husband has the financial responsibility for his four year old child.
Having regard to the findings made above, I am unable to make a finding as to husband’s current financial circumstances. He may be engaged in paid employment. He may receive financial benefits from the trading entity in Country E. The quantity of the financial assistance he concedes he has received from family members is unknown.
The husband gives no evidence about the financial circumstances of his current wife. In cross‑examination the husband asserted that Ms O does not work and does not have any assets nor liabilities that he is aware of. Ms O, according to the husband’s evidence, is also financially supported by Ms N. The wife was not afforded the opportunity to test the husband’s financial circumstances arising from his non-disclosure. I cannot, for the reasons accorded above, accept this evidence by the husband. Ms O is not on affidavit. I can only infer that any evidence given by Ms O would not have assisted the husband’s case.
When it was suggested again that the husband and Ms O are living on revenue from the business, the husband asserted that: “My sister is the owner of the business and she use the money to lend to me.” Ms N has been providing the husband with financial assistance since he returned to Country E. He lives with Ms O in the former home of his father and sometimes in the business. He does not pay any rent.
The factor in the adjustment to the contribution findings that weighs most heavily in favour of the wife is the husband’s failure to disclose his financial circumstances as recorded throughout these reasons, notwithstanding counsel for the husband’s submissions to the contrary.
Holistically and weighing up all of the above considerations I am satisfied that an adjustment to the contribution finding should be made in the wife’s favour of 10%. That equates to the wife receiving a further $140,347.
The wife will receive an adjustment to property of 55% and the husband 45%. Thus the wife is entitled to receive property to the value of $774,009 and the husband property to the value of $663,280. This is a differential of $140,729 in the wife’s favour.
JUST AND EQUITABLE
By the conclusion of the final hearing it was agreed that the wife will retain the Suburb C property and pay the husband a sum for his entitlement and that the wife be given 90 days in which to do so. It is agreed that the wife will retain the monies held jointly held in Trust. There does not appear to be an issue with the wife retaining the credit in the home loan account of $3,826.
The wife will retain property to the value of $964,910. The husband will retain property to the value of $442,379. Thus the wife will be required to pay the husband the sum of $190,901. This will be rounded to $190,000.
There will be a disparity between the adjusted property of the parties of 10% or $140,729 in favour of the wife.
Standing back and looking at the distribution of property on an overall basis, I find that this distribution achieves a just and equitable alteration of the property interests of the parties.
OTHER
Despite deposing to have relocated permanently to Country E, the husband received a grant through the Commonwealth Family Violence and Cross-examination of Parties Scheme to fund his preparation and representation of both counsel and a solicitor at the final hearing. This scheme is administered by the Legal Aid Commission of New South Wales and is funded by government grant. The husband made application to the Scheme as a consequence of an order made on 25 March 2024 pursuant to section 102NA on a discretionary basis that the parties would not be permitted to cross examine each other.
A party has several choices when an order is made pursuant to s102NA. They may continue unrepresented and not cross examine the other party. They may obtain their own legal representation; whether that be privately funded or by way of a grant of legal aid if they are eligible. They may apply for their legal representation to be funded by way of the Scheme. Whilst I do not have such application in evidence, I anticipate that it would require a disclosure as to any applicant’s residential address. I further anticipate that the scheme would not fund a person who does not permanently reside in Australia and/or is not an Australian citizen. The husband conceded during the course of cross-examination that he no longer resides in Australia. He further conceded that he did not advise the Scheme of this when making his application. I am not aware as to what the husband did disclose by way of such application.
None of the husband’s evidence illuminates his current address; his address on affidavit is that of his solicitor, and his financial statement deposes his address as being the Suburb C property. He was not questioned in his examination in chief as to his address.
A copy of this judgment will be forwarded to the New South Wales Legal Aid Commission, the administrator of the Scheme, for their consideration as to any action they may wish to take with respect to these concessions. The wife has 90 days in which to pay the husband the settlement sum. The Commission will be granted liberty to relist this matter by way of an Application in a Proceeding on 48 hours’ notice to the court and to the husband. A further copy of the Judgment will be forwarded to Centrelink for their information.
No submissions were made as to what is to occur in the event the wife is unable to pay to the husband the settlement sum. I have made orders for the sale of the property so as to alleviate the need for the parties to return to court for an enforcement application.
CONCLUSION
Orders will be made accordingly.
I certify that the preceding one hundred and ninety-six (196) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Murdoch. Associate:
Dated: 25 September 2024
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