Kozovska and Kozovski
[2009] FMCAfam 1014
•25 September 2009
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| KOZOVSKA & KOZOVSKI | [2009] FMCAfam 1014 |
| FAMILY LAW – Property – non-disclosure – family violence giving rise to Kennon claim – contribution rendered more arduous – finding of coercive controlling violence – assessment of Kennon adjustment – significant gambling losses – waste – assessment of contribution and future needs. |
| Family Law Act 1975, ss.75(2), 79 |
| Hickey & Hickey & Attorney-General of the Commonwealth of Australia (Intervener) (2003) FLC 93-143 Jaffe, PG, Johnston, JR, Crooks, CV, Bala, N, ‘Custody Disputes Involving Allegations of Domestic Violence: Toward a Differentiated Approach to Parenting Plans’ Family Court Review Vol. 6 No. 3, July 2008, Association of Family and Conciliation Courts Kelly, JB, Johnson, MP, ‘Differentiation Among Types of Intimate Partner Violence: Research Update and Implications for Interventions’ Family Court Review Vol. 6 No. 3, July 2008, Association of Family and Conciliation Courts |
| Applicant: | MS KOZOVSKA |
| Respondent: | MR KOZOVSKI |
| File Number: | WOC 519 of 2007 |
| Judgment of: | Altobelli FM |
| Hearing dates: | 21- 22 May, 29 June 2009 |
| Date of Last Submission: | 29 June 2009 |
| Delivered at: | Sydney |
| Delivered on: | 25 September 2009 |
REPRESENTATION
| Counsel for the Applicant: | Mr McPherson |
| Solicitors for the Applicant: | Heard McEwan Legal |
| Counsel for the Respondent: | Mr Durston |
| Solicitors for the Respondent: | Hennikers |
ORDERS
That within thirty (30) days, the Husband transfer all his right, title and interest in the former matrimonial home situate at Property B in the state of New South Wales, Folio Identifier [1] to the Wife.
That all monies currently held in trust for the parties by Heard McEwan Legal are to be distributed within thirty (30) days as follows:
(a)The husband is to receive 61.5 percent of said monies; and
(b)The wife is to receive 38.5 percent of said monies.
That the husband and wife be declared to have the sole right title and interest in respectively:
(a)Any chattels, goods, furnishings and other property which are, at the date hereof, in their possession respectively; and
(b)Any moneys, shares and debentures which stand in their sole name respectively at the date hereof; and
(c)Any entitlement to superannuation which stands in their sole name respectively at the date hereof.
That the husband and wife do all acts and things and give all consents and execute all documents and writings necessary to give effect to the orders made herein.
That in the event that either party refused or neglects to execute any deed or instrument, a Registrar of the Federal Magistrates Court of Australia be appointed pursuant to s.106A to execute such deed or instrument in the name of said party and to do all acts and things necessary to give validity to the operation of the deed or instrument.
IT IS NOTED that publication of this judgment under the pseudonym Kozovska & Kozovski is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
WOC 519 of 2007
| MS KOZOVSKA |
Applicant
And
| MR KOZOVSKI |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an application for property settlement under s.79 of the Family Law Act, commonly known as an application for property settlement. The applicant is the wife. She is 51 years old. The respondent is the husband. He is nearly 60 years old. They married in 1975, and separated albeit under the same roof in 1998. A divorce was not granted until 2007. Although the parties separated under the same roof in 1998 it is not clear whether their finances became separated as from that date.
Proceedings were commenced in April 2007 and judgment was reserved on 29 June 2009. A number of interim orders have been made during this period including for interim distribution of funds, sole occupancy of the former matrimonial home to the wife, in relation to valuations, and adjournment of the hearing on the application of the husband, orders in relation to distribution of sale proceeds and disclosure, and an order requiring the husband to vacate the property at Property F. The wife raises a number of serious issues in this case about family violence directed at her during the marriage such that her contribution was rendered significantly more arduous. She also raises issues about the husband’s gambling activities which, she asserts, constituted a waste of the parties’ assets. She further alleges that the husband has not been full and frank in his disclosure of his financial circumstances to the Court, and that there are serious issues about his credit. The husband disputes all of the issues raised by the wife.
Background
If one accepts that 1998 is the date of final separation, even though it was under the same roof, the husband and the wife had cohabited for a period of at least 23 years. They were both immigrants from Macedonia with the husband arriving in 1964, and the wife arriving in 1975. They met in Macedonia. They have one daughter, Ms Z, who is 30 years old, and the son Mr Y who is 29 years old. During the marriage the wife was primarily involved in homemaking and parenting as well as managing properties owned by the parties during the marriage. She was also employed in various part time and causal jobs but has been unable to work in that capacity since 2002. The husband was in constant employment throughout the marriage and ceased work in about 2005 as a result of a work-related injury. He has been in receipt of workers compensation payments since then.
There seems no dispute between the parties that the husband received monies from a compensation claim following a car accident he was involved in 1973, and these funds were used to purchase a block of four flats at Property F, which was purchased in joint names after they married. The wife concedes that some of the funds were also used to purchase a property at Property C, also in joint names. The Property C property was sold in controversial circumstances. The wife asserts that it was sold because the husband had to pay some gambling debts, a matter that the husband disputes. The parties then decided to purchase a property at Property O. It seems common ground that a mortgage was used to purchase this property.
In 1993 they purchased what became the former matrimonial home at Property B. Again funds were borrowed for this purpose. Along the way the parties also purchased an investment property in Property M, in the husband’s sole name. The precise details of this purchase were not clear from the evidence, but nothing turns on this.
If one pauses here, it becomes apparent from this short history, most of which is derived from the wife’s own affidavit, that even she concedes that it was the husband’s compensation payment arising out of an accident before they married, that funded the purchase of the flats at Property F, as well as the property at Property C. Much was made by the wife of the husband’s inability to produce documents to establish the precise details of the compensation claim in question, together with other compensation claims that he received during the course of the marriage. That may well be relevant as an issue relating to non-disclosure, and possibly relevant to other issues as well, but one would have though that even on the wife’s own evidence it would be very difficult for her to assert that the husband had not made a greater financial contribution, subject to the other matters that she raises.
The wife does, of course, raise other issues and in particular that throughout the course of the marriage she suffered family violence perpetrated by the husband, and witnessed by the parties’ children, including the daughter Ms Z who provided evidence to that effect. In addition, she deposed to the husband’s heavy drinking, which often fuelled the family violence, as well as his gambling. In effect, the wife is asserting that as a result of the husband’s conduct, her contribution to the marriage was rendered more arduous, and as a result of the husband’s gambling there was waste of considerable assets and, indeed, while she asserts that the extent of the husband’s gambling activities was significantly greater, she asserts that the documentary evidence before the court indicates at least $268,456 worth of add-backs as a result of the husband’s use of joint assets probably for gambling, but certainly not for purposes benefitting both of them. The husband, for his part, does not deny that he gambles, asserts that he had considerable winnings from gambling, denies that there was any wastage of joint assets, categorically denies the family violence and makes similar allegations towards the wife, and minimises the extent of his alcohol consumption. Were it not for these issues of family violence, excessive consumption of alcohol and gambling, this case would have been a relatively straightforward case about contribution and s.75(2) considerations. However, because of the assertions made by the wife, I will need to make findings about the family violence, the gambling, as well as deal with the wife’s assertions about non-disclosure and general credit issues relating to the husband. Even the husband’s counsel did not dispute that these were issues relating to the husband that needed to be addressed in the course of the case.
By the time of the hearing various properties had been sold either by agreement, or pursuant to orders of the Court. In effect the main assets for distribution consisted of the former matrimonial home at
Property B, together with the sale proceeds of the flats at Property F. In addition various funds that had been distributed to the parties pursuant to interim orders need to be added back.
The evidence at the final hearing consisted of affidavit and oral evidence provided by the husband, the wife, and their daughter Ms Z. Various affidavits were filed by valuers and a forensic accountant. They were not required for cross-examination.
At the final hearing in effect the wife’s position was that she should receive all assets apart from anything currently in the husband’s name or control. The basis of the wife’s argument in support of this claim was that the court would not be satisfied that the husband has disclosed the true extent of his property and income, that there should be significant add-backs of funds wasted by the husband, that there would be further findings of waste that might, or might not, relate in an add-back, that the contribution that she made was significant, and rendered significantly more arduous as a result of the family violence that she experiences and that there should be a s.75(2) adjustment in her favour.
The husband’s position at the hearing was that he should receive a property adjustment calculated at 55 per cent of the total assets available to the parties. This was predicated on the basis that he had made substantially greater contribution during the marriage as a result of the application of his compensation payments towards the acquisition of property. In addition, he asserts that there are s.75(2) factors working in his favour, principally because of his age and state of health. From his perspective of course there were no issues about non-disclosure, family violence, waste or gambling.
Having regard to that broad introduction and background, the issues that I need to decide in this case are as follows. Firstly, because the evidence of the parties is so different, and so divergent in relation to so many important issues, I will make findings as to credit. Following on, and related to issues of credit, is the issue of non-disclosure. Following on from these other issues, I should make findings about the family violence, and the gambling and asserted waste. Once this has been done, I will determine what the pool of assets is, make findings about contribution and s.75(2) considerations, and then decide what is a just and equitable order.
The Applicable Law
The preferred approach to the determination of an application under s.79 of the Family Law Act is set out in a passage found in the Full Court’s decision in Hickey & Hickey & Attorney-General of the Commonwealth of Australia (Intervener) (2003) FLC 93-143 at 39.
The Full Court states that there are four inter-related steps:
a)Identify and value the property, liabilities and financial resources of the parties; and
b)Identify and assess the contributions of the parties and express them as a percentage of the net value of the property; and
c)Identify and assess the other facts relevant under s.79(4)(d)-(g) including s.75(2) and determine the adjustment (if any) to be made to the contribution entitlements at step two; and
d)Consider the effect of the above and resolve what order is just and equitable in all the circumstances.
One of the legal issues that arises is whether I should adopt a global or asset-by-asset approach to contribution. The authority in this regard is, the High Court’s decision in Norbis v Norbis (1986) 161 CLR 513 per Wilson and Dawson JJ at 534-5. It is clear from this statement of the law that either approach is available to me, in part or in whole. My discretion in this regard should be exercised having regard to the facts of this case.
Another issue in this case is how, precisely, I should weigh and assess the initial contribution of the parties in bringing property into the marriage. In this regard, I need to consider the decision of the Full Court in Pierce v Pierce (1998) FLC 92-844. A useful recent decision of the Full Court examines its earlier decision in Pierce v Pierce together with a later case. In Williams & Williams [2007] FamCA 313 the Full Court states as follows at paragraphs 26, 27, 28, 29 and 32:
26. We think there is force in the proposition that a reference to the value of an item as at the date of the commencement of cohabitation without reference to its value to the parties at the time it was realised or its value to the parties at the time of trial, if still intact, may not give adequate recognition to the importance of its contribution to the pool of assets ultimately available for distribution between the parties Thus where the pool of assets available for distribution between the parties consists of say an investment portfolio or a block of land or a painting that has risen significantly in value as a result of market forces, it is appropriate to give recognition to its value at the time of hearing of the time it was realised rather than simply pay attention to its initial value at the time of commencement of cohabitation. But in doing so it is equally as important to give recognition to the myriad of other contributions that each of the parties has made during the course of their relationship.
27. In Pierce v Pierce when speaking of the relevance to be paid to initial contributions the Full Court (Ellis, Baker and O’Ryan JJ) referred to Fogarty J in Money v Money (1994) FLC 92-485 at 81,054; (1994) 17 Fam LR 814 at 816:
…respective contributions of the parties over a long period of marriage “offset” the significance which might otherwise be attached to a greater initial contribution by one party…ultimately, when it comes to the trial such a contribution is one of a number of factors to be considered. The longer the marriage the more likely it is that there will be latter factors of significance and in the ultimate the exercise is to weigh the original contribution with all other, later, factors and those later factors, whether equal or not, may in the circumstances of the individual case reduce the significance of the original contribution.
28. The Full Court (Ellis, Baker and O’Ryan JJ) then said at [28]:
In our opinion it is … a question of what weight is to be attached, in all the circumstances, to the initial contributions. 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.
29. Pierce v Pierce was a case in which the husband brought in $200,000 cash into the relationship. He applied that money towards the purchase of a matrimonial home. He was employed throughout the marriage and supported the wife who, whilst in some paid employment primarily attended to domestic tasks and taking care of the children. The Full Court assessed the parties’ respective contributions to a pool of $320,000 as 70 per cent in favour of the husband and 30 per cent in favour of the wife at the end of a 10 year relationship.
32. In Hunt v Zuryn (2005) FLC 93-226; (2005) 34 Fam LR 169 the Full Court (Kay, May and Boland JJ) allowed an appeal in a property case where a pool of assets of $1.12million had been assessed for contribution purposes as 75 per cent in favour of the husband and 25 per cent in favour of the wife. The Court in allowing the appeal indicated that an assessment of 75:25 fell outside the realms of an acceptable range saying at 79,730; 170:
Such an assessment ought adequately recognise that much of the parties’ wealth can be attributed to the capital growth in the assets introduced by the husband at the commencement of the marriage but at the same time bringing into consideration a myriad of other contributions each made in the course of their relationship.
Accordingly, I must not only identify the contributions of each party, but also assess the weight to be attributed to these contributions having regard to many factors including what has occurred afterwards.
A significant issue in this matter was the alleged non-disclosure of the husband. Attempting to deal with non-disclosure often puts the other spouse to considerable difficulty with regards to investigating their financial affairs. The Full Court in Weir (1993) FLC 92-338 at 79,593–4 made the following statement regarding the duty to disclose and the Court’s powers where non-disclosure has been found:
This Court has pointed out in a line of cases leading up to the recent decision of the Full Court in Black and Kellner (1992) FLC 92-287, that it is the duty of a party involved in property proceedings in this jurisdiction to make a full disclosure of their financial affairs. See also Giunti and Giunti (1986) FLC 91-759, and Mezzacappa and Mezzacappa (1987) 11 Fam LR 957; (1987) FLC 91-853. It is clear enough from his Honour's findings in the present case that the husband had not done so and had in fact pocketed the proceeds of a substantial number of cash sales. It is obvious that in most cases of this nature it is difficult enough for the other party to establish that fact let alone establish the quantum of what has been taken.
It seems to us that once it has been established that there has been a deliberate non-disclosure, which follows from his Honour's findings in this case, then the Court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature…
We appreciate that this is something of a broad brush approach, but, as we have said, where there is clear evidence of non-disclosure as there was here, the Court should not be unduly cautious about making findings in favour of the other party. It has been said by one commentator (O'Ryan and Broadfoot, 5th National Family Law Conference Handbook, p 249) the failure to disclose undermines the whole process of adjudication of proceedings for a settlement of property in that the court is unable to identify the property of the parties, to properly assess contribution, or to properly assess s 75(2) factors.
The wife raised what is, in effect, a waste argument. A succinct statement of the law in this regard is the statement by Baker J in Kowaliw and Kowaliw (1981) FLC 91-092 at 76 644:
As a statement of general principle, I am firmly of the view that financial losses incurred by parties or either of them in the course of a marriage whether such losses result from a joint or several liability, should be shared by them (although not necessarily equally) except in the following circumstances:
(a) where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets, or
(b) where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value.
The final legal issue that arises in this case is that raised by the wife – the extent, if at all, that her contributions were rendered more arduous as a result of various aspects of the husband’s conduct. The authority is the Full Court’s decision in Kennon and Kennon (1997) FLC 92-757.
A useful summary of the decision is contained at page 84, 294 of the report:
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. We prefer this approach to the concept of ''negative contributions'' which is sometimes referred to in this discussion.
In the above formulation, we have referred only to domestic violence, for the reasons which we indicated earlier, but its application is not limited to that…
However, it is important to consider the ''floodgates” argument. That is, these principles, which should only apply to exceptional cases, may become common coinage in property cases and be used inappropriately as tactical weapons or for personal attacks and so return this Court to fault and misconduct in property matters ¾ a circumstance which proved so debilitating in the past. In addition, there is the risk of substantial additional time and cost.
However, in our view, s 79 should encompass the exceptional cases which we described above. It would not be appropriate to exclude them as a matter of policy because of this risk. It is a matter of commonsense for the lawyers involved and, where that may not be sufficient, it is a matter for a firm hand by the Court at an early stage when a case appears to raise those issues.
It is essential to bear in mind the relatively narrow band of cases to which these considerations apply. To be relevant, it would be necessary to show that the conduct occurred during the course of the marriage and had a discernible impact upon the contributions of the other party. It is not directed to conduct which does not have that effect and of necessity it does not encompass (as in Ferguson) conduct related to the breakdown of the marriage (basically because it would not have had a sufficient duration for this impact to be relevant to contributions)…
The passage from the Full Court's decision in Kennon clearly indicates that it is a relatively narrow band of cases to which a Kennon-type adjustment would apply. The Full Court's decision focuses on conduct during the marriage, but not afterwards, which suggests the concept was not intended to apply to post-separation contribution. There is a clear emphasis by the Full Court on the need to establish that the violence had a discernable impact on the contributions made by one party. The focus seems to be on establishing either that there has been a significant adverse impact on a party's contributions, or that their contributions are significantly more arduous than they ought to have been. As I read the Full Court's decision, little or no room is left for inference. The claim can only be established by probative evidence that satisfies the Court on the balance of probabilities.
Credit Issues
It was a significant aspect of the wife’s case that the husband’s evidence could not be accepted, in many material respects. Interestingly, I did not understand this submission to be that his evidence about contribution was not to be accepted because, indeed, even on the wife’s own material she concedes these substantial financial contributions he made through compensation payments, albeit unspecified as to amount and time. Moreover, he was not cross-examined about this issue. Hence findings of credit relate principally to the evidence that he gave about family violence, about gambling, and about the use of joint assets for those purposes, but especially gambling.
I agree with the wife. There are real issues about the extent to which I can accept the husband’s evidence about the aforementioned issues. For example, the manner in which he gave evidence during cross-examination was less than impressive. He was very often unresponsive, occasionally argumentative, and frequently vague and often dismissive of that which was being put to him. I allow for the fact that English is not his first language, and that he appeared to be suffering from a throat condition that made it difficult to speak at times. However, he had the assistance of an interpreter and he always seemed to clearly understand what was put to him, albeit perhaps after some clarification. At the end of the day, however, he simply could not provide answers to the questions that were being asked of him in the wife’s case. For example, in relation to the fairly detailed allegations of family violence in the wife’s affidavit and his daughter’s affidavit, he could only respond with bland denials, and some fairly colourful counter-allegations otherwise unsupported in his evidence, and uncorroborated in any other evidence. He clearly put the issue of family violence in contention during the course of his own evidence, but the fact is that neither the wife nor daughter were substantially challenged in cross-examination about their version of events relating to family violence. His credit suffered a substantial blow, just in relation to this point.
His credit further suffered by alleging the existence of more than $100,000 in debts which had arisen comparatively recently but in respect of which he could provide no documentary evidence, nor could he produce any of the alleged lenders to provide evidence in support of this contention. He could provide no explanation why the loans in question were not disclosed in earlier affidavits despite his assertions that the loan was made before the said affidavit. When confronted with the inconsistencies such as this, the husband’s response was that he did not know.
The husband was very meticulously cross-examined in relation to use of credit cards, and ATMs, all in the context of alleged gambling. The husband was clearly confronted with a substantial volume of documentation that pointed towards gambling related expenditure but his responses, when made, were often vague, dismissive, and sometimes even provocative. For example, in cross-examination he conceded that some of the funds withdrawn were in fact used for prostitutes. This evidence clearly distressed the wife and when I adjourned the proceedings for a few minutes so that she could regain her composure, the husband suggested to me that his wife was acting.
If his lack of credibility was poor in cross-examination, it didn’t improve in the re-examination by his own counsel. It should be borne in mind that re-examination for the husband was the opportunity for him to adduce evidence that he had many, many months to adduce in the form of an affidavit, but, for some reason, chose not to. It was a golden opportunity for the husband to be more convincing about all the withdrawals from his accounts. Alas, the opportunity was lost. He frequently simply could not recall what transactions were about, despite his own counsel’s valiant efforts in this regard. When he answered, he was hesitant and clearly uncertain. Once he “warmed up” to the pattern of questions about withdrawals he provided trite explanations which, unfortunately for him, had no ring of truth about them whatsoever. Quite frankly, I formed the impression that he was making it up as he went along.
In short, the husband was a less than impressive witness who, when it suited him, could recall transactions in infinite detail, but at other times could not recall comparatively recent events and correspondence. Unless the husband’s evidence about the matters before the Court are corroborated from some other source, I prefer the evidence of his wife and daughter, where it conflicts. I record here that an effort was made by counsel for the husband to undermine the credibility of the wife based on evidence she gave about events at the commencement of the marriage and during her first pregnancy. The first pregnancy, which led to the unfortunate death of their child, was clearly a stressful event for the wife. Her poor recollection of these events in no way led me to believe that any evidence she gave about later events was somehow tainted.
Non-disclosure
The wife’s submission that the husband has failed in his duty to disclose matters to the court is based primarily on his failure to produce relevant documents, as well as the evidence he actually gave in court. In this case, as in many other cases, the issue of non-disclosure is very much tied up with credit issues. There is ample correspondence between the solicitors in evidence that supports the contention that the husband has been ambivalent and cavalier in terms of complying with his duty to disclose documents to the Court. On November 7 2008 I made orders requiring the husband to provide the documents referred to in Order 4. He clearly failed to do so. When cross-examined about this failure he was evasive, indicated that he did not know about various documents, and then alleged that he had produced documents to his solicitor. However, when a call for production was made, there were no documents to produce in response to the call. As it turns out, the wife was a far better source of information about the transactions that the husband had entered into, as the husband himself. This was because, presumably, she had been put to significant expense in making enquiries and issuing subpoenae. His failure to produce documents in relation to alleged debts, the draw-down and use of his superannuation, various loans etc was quite stunning. The husband’s failure to disclose documents must be understood in the context of my findings about his credit above, as well as the findings I make about gambling below. Putting all these things together, I find that the husband has been less than frank in his disclosure to me about his assets, liabilities, income and expenditure. There are many aspects of this case that remain a mystery. The husband’s affidavits, for example, are replete with protestations of poverty and financial need. His solicitor’s correspondence likewise reflects the financial plight of the husband. And yet he travelled to Thailand at least three times during the course of these proceedings, once for a month, once for four months, and once for three months. His explanation for how these trips were funded lacked any credibility at all.
Gambling
The wife’s case is that documents produced on subpoena by Star City Casino indicate that the husband had been involved in gambling on a quite substantial scale. Indeed, those records indicate that between 1995 to 2007, a period of about 11 years, the husband had attended the casino on 680 days, or an average of 61 days each year. The records produced by Star City indicate that over that period the husband lost $1.8 million. The interpretation of the documents produced on subpoena was an issue that was raised in Court months before the final hearing. The documents had physically been present in court for several months before the hearing. Some of the most important correspondence explaining the documents were attached to affidavits that were available to the husband months before the final hearing. There was an issue that was raised about whether the $1.8 million figure was not a loss figure, but a turnover figure. It clearly is not and, indeed, even counsel for the husband could not assert that that figure was a turnover figure. Nonetheless, counsel for the husband submitted that the figure was clearly, obviously wrong because all that was known about the financial circumstances of the husband and the wife, even accepting the wife’s case put at its highest, could not possible explain a loss of $1.8 million dollars.
It is necessary go back a step. The wife’s assertions about the husband’s gambling are clearly articulated in her affidavits sworn
20 October 2008. In the husband’s affidavit sworn 29 January 2009 the husband states at paragraph 15:
I used to go to Star City Casino, and sometimes when I had a good win I would give money to the family. [Ms Kozovska] never asked me to stop going to the Casino because I often gave her money when I returned home from a visit to the Casino.
At paragraph 17 of the said affidavit the husband says:
it is true that when I was in the Casino on many times I did get money from some people, and then when I would win I would give the money back to them, and this would earn me points that gave me benefits at the casino. Sometimes my daughter and son stayed at the Casino, and sometimes I took home a lot of meals home from the casino as part of the benefits I received.
At paragraph 18 of his affidavit he says:
I did not have $1.8 million that I took from any family funds or from anything that we owned to gamble at Star City Casino. I only ever got money from other people at the casino. If I make any further statements or specify further details about this, and if I named anyone, it would cause me a lot of trouble. I still do not believe that the amount of $1.8 million which Star City claim I gamble is correct…
At paragraph 19 he asserts once again that he didn’t withdraw money from family funds or any mortgages to pay for gambling. He sets out that his only income was workers compensation payments, and, for a limited period, rentals from one of the units they owned.
The husband was, of course, extensively cross-examined on this topic. He denied using any money from sale proceeds of properties, or loans, for gambling purposes. He denied using his daughter’s compensation payments for gambling purposes. He agreed, however, that he did stay at Star City Casino several nights at a time. He was then meticulously cross-examined about various bank statements that indicated often substantial cash withdrawals, multiplied several times over short periods of time. It was put to the husband that the documents produced by Westpac, the Commonwealth Bank, and the Credit Union showed that withdrawals made from or near Star City between 2001 and 2008 amounted to almost $143,000. The husband said two things – firstly, that it was not true, and could not be possible. Secondly, he insisted that there were deposits which counsel was not referring to. Pausing here for one moment, I am satisfied that the aide memoire provided to me by counsel for the wife does in fact accurately reflect the transactions that are referred to in the documents produced on subpoena by Westpac, the Commonwealth Bank and the Credit Union as being transactions at or near Star City and which totalled $142,693 between 2001 and 2008. I will deal with the question of deposits back into these accounts in due course.
The husband agreed in cross examination that he also gambled at the Crown Casino in Melbourne, and at the casino in Fremantle, Western Australia. In relation to the purpose of withdrawals from ATMs he said that some of it was for gambling, and some of it was for family. He agreed that when he gambled at Fremantle they (presumably the operators of the Casino) paid for him to go there and he bought some customers with him. When he gambled there he was not using his own money, but money provided by them. He would invite friends of his to attend with him. This system also operated for the Crown Casino in Melbourne, but not at Star City.
Counsel for the wife put it to the husband that the monies that he obtained from other people might explain the $1.8 million loss referred to in the Star City documents. The husband denied this.
Going back to ATM withdrawals, the husband agreed, for example, that when he withdrew monies from the Westpac ATM in Pyrmont it was for gambling purposes. When taken in cross-examination to three withdrawals of $1000 at the said ATM on 5 March 2007, he asserted that not all of that was used for gambling, some of it was used for shopping, especially for toys. The husband denied that a withdrawal of $1,000 from an ATM at Star City made at 2.35am was used for gambling, and he didn’t know why there was a second withdrawal of the same amount of $1,000.
Counsel for the wife quite fairly put it to the husband that on
8 February 2007 there was a deposit into the account of $72,926, and the husband agreed that that came from his superannuation. Over the next few weeks, the husband progressively withdrew money from the said account, from ATMs at Pyrmont and at Star City, and even at Haymarket, but denied that it was necessarily all used for gambling.
As the husband was placed under increasing pressure in cross-examination about the frequency and quantum of withdrawals from Star City, or thereabouts, he seemed to become more agitated. When it was put to him that there was no reason to be making withdrawals in or near Star City for reasons other than gambling, the husband explained that maybe there were other things such as perhaps women. When asked whether there was an escort agency at Star City, he said “maybe”. When it was specifically put to him that some money was used for women, he responded likewise. It was put to him that if not all, nearly all of the money withdrawn from or near Star City was used for gambling, and the husband finally conceded that that was correct. He did insist, however, that counsel was misrepresenting the situation because there were deposits into the account, principally from winnings.
He was then cross-examined about the refinance of the Westpac loan secured over the Property M property, later sold. The husband seemed to develop a case of memory loss because he couldn’t recall anything about this transaction. It was put to him that the increase in this mortgage was deposited into the account from which he subsequently made withdrawals for gambling purposes. For example, there were two withdrawals of $1,000 each within half an hour on 28 November 2005. Whilst he agreed that the money could have been used for gambling, he denied that it came from the mortgage over the Property M property. When asked further questions about what the monies were used for i.e. the moneys drawn down on the mortgage, he suggested to counsel for the wife that he should ask his client about how much jewellery she purchased with this money. Notwithstanding this, the husband then agreed that no, he had not made this assertion in his affidavit, but that in fact his wife has between $70,000 and $80,000 worth of jewellery. It is interesting to note that in the husband’s solicitor’s case outline document, the assertion is only $40,000 worth of jewellery.
My impression of the husband at the end of his cross-examination about gambling in consistent with the impression I have formed about him as a witness generally. At no time did I get a sense that I was hearing the full story from him. He was evasive, defensive, flippant and at times quite offensive in his evidence. He had what seemed to be convenient memory lapses. Notwithstanding all of that, even on the husband’s own evidence a picture is painted of a regular gambler who often spent thousands of dollars at Star City casino, within relatively limited periods of time.
Before proceedings to consider the husbands re-examination, and his case about winnings and deposits into the accounts where it is now obvious that he withdrew substantial funds for gambling purposes, it is important to understand the full magnitude of the wife’s case.
I referred to above an aide memoire prepared by the solicitor and counsel for the wife which, I agree, accurately summarises withdrawals made from the husband’s Westpac, Commonwealth Bank and Credit Union accounts at Star City, or in the vicinity thereof, between 2001 and 2008, and totalling $142,693.30. It must be understood, however, that that is not the full extent off the wife’s case for add-backs. The wife’s claim is for a total of $268,456.06 as set out in the enclosed table which formed part of the wife’s updated case outline document as submitted on the final day of the hearing.
| Evidence | Amount |
| Wife’s affidavit paragraph 59 | $55,677.37 |
| Wife’s affidavit paragraphs 62, 69 | $72,936.40 |
| Wife’s affidavit paragraph 64(d) | $4,000.00 |
| Wife’s affidavit paragraph 71 | $57,746.29 |
| Wife’s affidavit paragraph 72 | $1,506.00 |
| Westpac Subpoena Documents – refinance | $76,600.00 |
| TOTAL | $268,456.06 |
The wife’s case is she does not know where the $268,456.06 went, and that all of this money was controlled solely by the husband and he has provided no satisfactory explanation for the use of the funds. She asserts that the evidence creates a strong inference that it was used for gambling purposes, particularly having regard to the husband’s protestations that, having regard to his modest income, he could not afford to gamble in the amounts that are suggested in the Star City Casino documents. It is a strong inference created by the wife’s case that the $142,693.30 drawn from the husband’s accounts and used either at Star City Casino, or in its surrounding area, was part of the $268,456.06 which is not accounted for. I must say that I find it quite amazing that, these issues having been raised in the wife’s affidavit sworn 20 October 2008, the husband made so little effort to answer the allegations in his affidavit sworn 29 January 2009. It was left entirely to his re-examination.
The real test of the veracity of the husband’s evidence in
re-examination about casino winnings is to compare his assertions to the actual records produced by Star City. For example, the husband gave evidence in cross-examination that a deposit that was made into his Commonwealth Bank Streamline account of $1,600 of March 8 2004 represented winnings from the casino. The Star City Casino records indicate, however, that he had not been at the casino since
29 February 2004 and did not go again until 9 March 2004. The records indicate that on 29 February 2004 he lost $3,800 and won nothing.
The husband asserts that on 13 April 2004 a deposit of $1,000 came from casino winnings. The records indicate that on 13 April 2004 the husband did in fact win $1,000, but lost $1,900.
It is interesting to note the curious gap in deposits into this account between the 8 March 2004 and 13 April 2004, just over a period of one month. According to Star City’s records, he attended the Casino on
21 days between this period. Just on a rough count during this period he won about $25,000, but lost well over $50,000.
The husband asserts that on 14 October 2004 a deposit into the streamline account on $1,100 was attributable to casino winnings. According to Star City records, however, his last visit to the casino was 10 October 2004, when he had won $1,700 but lost $7,900.
He asserts that on 5 November 2004 a deposit of $1800 into the Streamline account was also attributable to casino winnings. His last attendance at the casino before that date was on 3 November when he had won $1,000, but lost $3,000.
The husband gave evidence that on 6 July 2004 a $10,000 deposit into his Westpac Classic account was attributable to winnings from the casino. The records indicate that his last attendance at the casino was on 5 July 2004, when he lost $100. Indeed his last win at the casino was on 4 July 2004, $300, 3 July $300, with another win of $3,000 on 3 July 2004. In the period between 3 July 2004 and 5 July 2004, however, the husband lost $12,300.
The husband asserted that a deposit of $5,000 on 24 September 2005 was attributable to casino winnings. The documents produced by Star City, however, indicate that he was last at the casino on 19 September 2005 when, incidentally, he commenced gambling just after midnight, and finished at 11:20pm that day. He had a lucky day on 19 September, winning $5,000, and only losing $7,815.
I will refer to one further example. The husband asserts that on
28 October 2005 a deposit of $8,000 was attributable to casino winnings. He did in fact attend the casino on that date and lost $2,000. The day before, 27 October 2005, he won $900, but lost $2,400.
On 26 October he won $1,700 without losing anything. On 23 October 2005 he won nothing, but lost $5,950.
I need go no further. The inherent implausibility of that which the husband asserts becomes apparent. I readily concede that it is not impossible for the husband’s evidence to be correct, its just that it is highly improbable having regard to the objective evidence. The husband might have some explanation for why the Star City records are so inconsistent with the evidence he gave in re-examination, but if he has such an explanation he did not provide it, even though he had multiple opportunities to do so.
The documents produced on subpoena by Star City, and the husband’s own evidence satisfies me on the balance of probabilities that the husband was clearly a committed, and possibly addicted gambler. Whether the figure of $1.8 million referred to in the Star City documents is correct or not is an issue in this case. On the one hand, it is a business record prepared by an independent person who has no interest in the outcome of this litigation. On the other hand, it is hard to see where the husband would obtain $1.8 million, even allowing for generous winnings. The wife has what rapidly becomes a plausible theory as to the source of at least $268,456 of the monies lost in gambling. The husband provides no satisfactory explanation about the source of funds used in his extensive gambling activities. The waste argument looms large in this case, as does the non-disclosure argument.
Family Violence
The wife’s evidence about family violence is contained at paragraphs 30-37 and 40-45 of her affidavit sworn 20 October 2008.
30. [Mr Kozovski] and I have never had a good relationship. I have been physically, verbally and emotionally abused throughout our marriage as described herein. The first occasion of physical abuse started one month after we were married.
31. Over the past ten years especially [Mr Kozovski] was drunk every day and spent most afternoons at either a pub or a gambling den or Casino. He would stay at the Casino for several nights at a time. When he would come home from these places, every single day, he would make threats saying “I will kill you with a knife while you are sleeping at night” and saying “I will pour petrol all over the house while you are sleeping and light it up so you burn to death”. I would say this mostly in Macedonian and to my children now and then in English.
32. In particular, over the last ten years an everyday routine [Mr Kozovski] would use nasty bad language towards me and he would throw at me whatever objects he would have in front of him including shoes, forks, spoons, television remotes.
33. A few years ago, I don’t remember which year, [Mr Kozovski] punched me and choked me around the neck a couple of times in front of my son, [Mr Y] and luckily my son grabbed [Mr Kozovski] off me and saved my life. I felt certain that I would have died. I could not breathe and was scared to death.
34. On another occasion about two or three years ago [Mr Kozovski] punched me and tried to choke me again in front of my daughter [Ms Z]. He punched me down to the ground and choked me from behind. [Ms Z] started crying and yelling and pushing him off me.
35. He has often hit me on the back of the head with his hand. On one other occasion he grabbed a knife and said: “I’m going to kill you”. I called the police straight away.
36. Everyday [Mr Kozovski] verbally abused me, repetitively. He has said: “I will chop your head off and take it to Newcastle to celebrate”. My family live at Newcastle.
37. He has also said: “I’ll take you in the car and dump you somewhere”. Also: “Everyday I think of something to do to you that no-one has ever done to anyone before”. Also: “I will sell everything without you knowing and you will be without a cent, left on the street”.
…
40. Over the years, particularly when he has been drunk, [Mr Kozovski] has been physically abusive towards me. He has punched me all over my body, he has tried to stab me with a knife. He has threatened to kill me on a number of occasions. He has thrown objects at me including the old style telephone. I have made reports to Police in this regard.
41. In 1992 an AVO was sought and obtained by Police on my behalf against [Mr Kozovski]. This AVO expired on 30 September 1993. [Mr Kozovski] did not take the proceedings seriously and breached this AVO on numerous occasions. I did not believe that the AVO did any good and so gave up and just continued to put up with his abuse.
42. My son, [Mr Y], would generally ward off [Mr Kozovski] from as much physical abuse as he could especially as he got older and grew in stature. He has refused to leave home or obtain employment choosing instead to stay at home with me. [Mr Kozovski] has said to me “I’m too old now to be worried about myself, now I’m just thinking about how I’m going to kill you all”. [Mr Y] would have trouble sleeping preferring to sleep during the day when [Mr Kozovski] was at work so that he could keep aware at night time in case [Mr Kozovski] attempted to cause me physical injury.
43. On an occasion several years ago (I do not recall when but possibly in the 1980’s) [Mr Kozovski] came home one night and put a knife to my throat. He was drunk. He said to me: “You have to come into the bank and get a loan for $5,000. I owe it to some people otherwise they will kill me”. He took me to the Commonwealth Bank the next day and made me sign paperwork. I do not know what it was that I was signing. I do not know how much money was borrowed.
44. I tried telling [Mr Kozovski]’s parents about it in an effort to obtain some support to stop [Mr Kozovski] from his behaviour but they said: “It is not our problem”.
45. I felt completely powerless to stop him from abusing me or spending money on gambling. I was consoled only by my ability to earn a limited income which at least supported myself and the children by way of food and clothing.
The parties’ daughter, Ms Z, in her affidavit sworn 20 October 2008, corroborates the wife’s assertions. She deals with this at paragraph 10 of her affidavits
10. I had a real fear that my mother was living in danger with my father in the house. My brother stays at home most of the time to be with my mother. I feel that my brother is my mother's protection if anything was to happen. Since I have moved out of the home and before my father moved out, whenever I visited it had been my observation that my father was more likely to be intoxicated than sober.
The husband deals with the allegations of abuse contained in an earlier affidavit of the wife, in his affidavit sworn 28 June 2007, filed 7 August 2007. At paragraph 29 he states:
29. I have read the allegation of abuse in [Ms Kozovska]’s affidavit and in the affidavits of my daughter [Ms Z] and son [Mr Y], all filed on 30 April 2007. I deny that I abused [Ms Kozovska]. I deny that we separated in 1998. We lived separately under one roof for the past 16 years, and have on many occasions argued with one another. For example, they won’t let me watch TV with them or eat dinner with them. I find this distressing and it upsets me.
In his later affidavits sworn 29 January 2009, the husband simply denies that he was violent against her in the relationship. At paragraph 26 of that affidavit he admits however that sometimes he would become angry very easily after he suffered a head injury in a work related accident in 2003. At paragraph 35 he denies the use of bad language in speaking to the wife, but agrees that they had arguments where they swore at each other and things were said that he regretted. He agrees at paragraph 36 that police were called to the home of a few occasions but took no action.
As I have indicated earlier in my reasons the wife was cross-examined by the husband’s counsel in relation to her allegations but the highest point was the assertion that the wife had exaggerated the stories, a matter that she strenuously denied. The cross-examination did elicit an admission that in the later years of the marriage the wife did respond to the husband’s threats with her own threats. In the cross-examination of Ms Z who gave evidence that she enjoyed a good relationship with her father, there was in effect no challenge to the evidence she gave about family violence. She too conceded that, however, her mother perhaps retaliated in self defence on occasions, but that it never amounted to more than swearing back at him.
In the husband’s cross-examination he categorically denied the allegations made by the wife and asserted that Ms Z had been forced to say the things she said in her affidavit. He again confirmed, however, that the police were called to the home many times, but he never got into trouble. He referred to the wife’s allegations about violence as her “talk too many stories”.
On balance I accept the wife’s evidence, corroborated as it is by her daughter. The husband’s denials seem rather bland and unconvincing. He is prepared to concede that the police were called several times, even though, to use his own words, he did not get into trouble. Even though the husband asserted in cross-examination his belief that Ms Z was forced to give the evidence she did, that was not put to Ms Z in cross-examination. I find the family violence as alleged and I find that there is sufficient evidence about the family violence and its impacts on the wife, either from the wife or the daughter, to satisfy me that it made the wife’s contribution significantly more arduous.
Pool of Assets
Apart from the issue of add-backs, there were not many significant issues about balance sheet items, and the values to be attributed thereto. There was evidence by way of valuation of the former matrimonial home at Property B leading me to conclude that it is valued at $510,000. The husband’s assertion of $700,000 was unsupported by any expert evidence. It is agreed between the parties that the balance of the sale proceeds of the flats at Property F is $507,221. The husband asserts that the wife has jewellery of $40,000 but adduces no evidence in relation to this and in any event the wife was not cross-examined about it. As there is no evidence about the wife’s jewellery I will not include it on the balance sheet. There is valuation evidence to establish that the value of the furniture in the former matrimonial home is $4,000. The husband asserted it was $10,000 but produces no evidence in this regard. The husband owns a Jaguar motor vehicle which the wife asserts has a value of $10,000. She produces no evidence in this regard, however. The husband says his vehicle is worth $7,000, so I will adopt this figure as an admission against interest. There is insufficient evidence before me to include Bluescope Steel shares on the balance sheet. The wife has superannuation which, according to her latest financial statement, has a value of about $9,000, and so I will accept this as an admission against interest, in the absence of any other evidence. The evidence indicates that the husband has no superannuation as most of it has already been drawn down by him.
There are no other known assets but as I have indicated above I believe that the husband has failed in his duty of disclosure to the court. Also, as indicated above, there is a significant issue about add-backs. The wife asserts that $268,456 (see table referred to above) should be added back. The supporting evidence supports the wife’s assertions in this regard. The husband’s evidence goes nowhere near providing an adequate explanation as to what these funds were used for. I am satisfied he had the exclusive control of these funds. I am satisfied he has had ample opportunity to provide an explanation but has failed to do so. I am not even prepared to accept that some part of these funds were used for reasonable living expenses and therefore ought not to be added back. There is far too much uncertainty in this case about the source of funds that the husband used to finance his extensive gambling activities. Moreover, in view of the findings of non-disclosure I have made against the husband, it would not be appropriate to give him the benefit of the doubt about using at least some of the $268,456 as reasonable living expenses. Accordingly, I add-back the $268,456 as an item owned by the husband.
Having regard to these matters the known pool of assets will be as follows:
| Asset | Value | Owned by: |
| Former Matrimonial Home, Property B | $510,000 | Joint |
| Balance of sale proceeds of Property F | $507,221 | Joint |
| Contents of Former Matrimonial Home | $4,000 | Joint |
| Jaguar motor vehicle | $7,000 | Husband |
| Wife’s superannuation | $9,000 | Wife |
| Add-backs | $268,456 | Husband |
| TOTAL ASSET POOL | $1,305,677 |
Contribution
There are, of course, a number of different aspects to the issue of contribution in this case. I will deal firstly with the issue of financial contribution.
There is sufficient evidence to confirm that the wife received a net compensation payment to her of $6,000 early in January 2007 which was used for joint purposes, namely a payment to the Commonwealth Bank which, I accept, was to forestall a mortgagee sale. I appreciate that, technically, this is a post-separation contribution.
At paragraph 20 of her affidavit, and also in cross-examination, the wife confirmed that at or shortly after the marriage the husband received the proceeds of a compensation claim following a car accident in 1973 and applied those monies towards the purchase of the units at Property F purchased in joint names, and also towards the purchase of the property at Property C in joint names. No monies were borrowed to purchase Property F. The wife asserts that there was a small mortgage to purchase Property C, whereas the husband asserts there was no mortgage. I note that even the wife describes the Property C mortgage as a small one. I do not know the purchase price of Property F, but the wife asserts and I accept that the purchase price of Property C was $35,100. At paragraph 27 of the husband’s affidavit sworn 29 January 2009 he asserts that the amount of his compensation claim was $80,000 and that it was used to purchase both the above properties. The husband’s evidence in this regard was not challenged and I therefore accept it.
The wife asserts that in 1979 or 1980 the husband insisted that the Property C property be sold in order to pay some gambling debts. She does not know precisely what happened to the sale proceeds, but believes they received about $25,000 and that the husband may have purchased a Volvo motor vehicle at about that time. At paragraph 22 of the husband’s affidavit he confirms that a part of the sale proceeds of Property C were used to purchase the Volvo motor vehicle and then states “I spent the rest of the money on the family in the usual way and I think it was in the amount for approximately $25,000 or a little bit less”. I find this evidence very difficult to accept. At the relevant time, for any family let alone this family, $25,000 would have been a substantial sum of money and so I doubt whether it was simply spent “on the family in the usual way”, whatever that might mean. Was this money used to pay gambling debts, as the wife asserts? The material from Star City Casino certainly confirms that the husband was visiting the Casino from 1995, but there is no evidence to suggest that he was gambling from 1979 or 1980. I cannot accept the wife’s assertion that the funds were used for gambling. Neither the husband nor the wife produces evidence to enable me to make a finding about what happened to the sale proceeds of the Property C property, and neither party adduces evidence to satisfy me that their explanation or theory for what happened to the funds is correct. I simply don’t know.
The husband asserts in paragraph 28 of his affidavit that he had three further worker’s compensation claims in 1993, 1994, and 1998 in which he received $35,000, $40,000, and $27,000 respectively. He also deposes to the fact that he has a current worker’s compensation claim pending out of which, all going well, he might expect to receive about $10,000. The husband provides no explanation for what happened to these worker’s compensation payments. This is curious having regard to the extent of the same. It is not part of the wife’s case that these sums should be added back into the property pool as notional property. Whilst it is part of the wife’s case that the husband was unable to provide documents to substantiate these claims, it was never put to the husband that he never in fact received these monies. It was only put to him that he could not produce documents to verify the receipt of these funds.
The medical evidence annexed to the husband’s affidavit, in respect of which no objection was made, certainly confirms that he suffered and injury in February 2003, but does not refer to any earlier injuries that coincide with the dates of the compensation payments referred to by the husband.
If the husband is correct then he made a further contribution of $102,000 but not only does he produce no documents to support his claim, but he doesn’t even adduce evidence about how these funds were used. I therefore cannot accept his evidence under the circumstances though I suspect it is more a case of the husband could not prove his assertions in this regard, rather than a finding being made that he did not receive these funds. This is yet another unexplained feature of this case.
Putting aside the Kennon claim for contribution rendered more arduous as a result of family violence, I would assess the non-financial contribution of the husband and wife, and the financial contribution attributable to employment, as being equal. They both appeared to have worked hard, and to their respective capacities.
Looking at contribution overall, and again putting aside the Kennon issue, a finding of greater contribution by the husband is inevitable. Whatever might have happened to the sale proceeds of Property C, the fact is that the sale proceeds to the Property F flats represent about half of the total assets owned by the parties. The evidence indicates that this property was unencumbered and was income producing, meaning that matrimonial funds were not used in its maintenance or preservation. The wife’s claim to contribution to this property cannot be a significant one, though she clearly contributed indirectly in many ways, as well as was clearly responsible for managing the property for a considerable period of time. By no means, however, can it be said that the myriad contributions made by the wife after the acquisition of the Property F flats in some way completely offset the substantial contribution made by the husband who, in effect, brought this asset into the marriage as a result of his personal injuries compensation claim.
By assessing the husband’s overall contribution, but for the Kennon claim, at 65 percent, if the asset pool is rounded off to $1.3 million dollars, this would mean that the difference between the husband and wife’s entitlement would be about $390,000, or just over 77 percent of the available proceeds of sale of the Property F flats. I am satisfied, under the circumstances of this case, that that adjustment is just and equitable.
The impact of the family violence must also be considered in the context of contribution. I would characterise the family violence that the husband perpetrated on the wife during the marriage as falling into the category of coercive controlling violence. Coercive controlling violence is described by Kelly and Johnson[1] as an ongoing use of threat, force, emotional abuse and other coercive means to unilaterally dominate one partner and induce fear, submission and compliance in the other. Its focus is on control by e.g. intimidation, emotional abuse, isolation, minimizing, denying, blaming, using children, asserting male privilege, economic abuse, coercion and threats. Jaffe and Johnston[2] describe this as abusive controlling violence.
[1] Kelly, JB, Johnson, MP, ‘Differentiation Among Types of Intimate Partner Violence: Research Update and Implications for Interventions’ 46 Family Court Review 2008
[2] Jaffe, PG, Johnston, JR et al, ‘Custody Disputes Involving Allegations of Domestic Violence: Toward a Differentiated Approach to Parenting Plans’ 46 Family Court Review 2008
I am left in no doubt that the evidence provided by both the wife and the daughter satisfies me, without having to draw any inference, that her contribution was rendered more arduous. In any event I would be prepared to infer that the contribution was rendered more arduous based on comments made by the Full Court in Doherty (1996) FLC 92-652 at 82,683 per Baker J.
Assessing the extent that the more arduous contribution should be reflected in the property settlement is difficult, and rather arbitrary. Counsel for the wife submitted it should be 10 percent. I accept this figure as being appropriate under the circumstances of this case, but, quite frankly, if I had been asked to assess contribution at a higher figure, I would have. My real concern, however, is as to the artificiality of a Kennon-type adjustment, whatever the percentage is. Having regard to the nature of the violence suffered by the wife during a long marriage it is clear that neither 10 percent or any other figure could possibly be characterised as compensatory because no amount could compensate her for what she experienced at the hands of the husband. On a property pool of about $1.3 million, 10 percent is $130,000, an amount which almost offends one’s sense of justice and equity having regard to the findings I have made. But clearly the adjustment that the Full Court contemplated in its decision in Kennon was not meant to be compensatory, but more in the nature of perhaps symbolic recognition of the extraordinary efforts of one spouse in persisting with contribution in the face of enormous and unjustified adversity. One cannot help but think that much greater thought needs to be given to the very rationale of a Kennon-type adjustment, and whether there might be a better, more transparent, and fairer method for dealing with issues of conduct in the course of financial matters in the Family Law Courts.
In any event, an assessment of 10 percent in relation to the Kennon adjustment would bring the wife’s contribution up to 45 percent and the husband’s down to 55 percent.
Section 75(2) considerations
The husband asserts that there should be a s.75(2) adjustment in his favour principally arising out of his age, inability to work, and his poor health. At the moment he is not living in his own accommodation, whereas the wife is living in the former matrimonial home and appears to enjoy the support of the children. The husband’s assertions about his health are borne out by the medical evidence that he annexes to his affidavit without objection. I think it is clear that having regard to the medical conditions referred to in those reports, as well as his age, he has no capacity for gainful employment. It was submitted on the husband’s behalf that he is unable to receive a Centrelink pension because of the worker’s compensation payments he receives, and his previous worker’s compensation settlements. There is no evidence to this effect, but I am prepared to infer that in all likelihood if he were entitled to a pension he would be receiving the same.
The wife also asserts that she is in poor health, but there is no evidence that establishes the nature and extent of her ill health. There are however the observations of her daughter, in her affidavit. In the wife’s counsel’s written submissions it was submitted that a relevant s.75(2)(o) factor was the need for the Court to take into account in a meaningful way the arduous conditions under which the wife lived, and under which she made her contributions to the welfare of the family. In addition it was submitted that the Court should take into account the husband’s diminution of matrimonial assets by his excessive gambling and appropriation of matrimonial assets for his own use. I do not think it is just and equitable, however, to treat these matters as a s.75(2)(o) consideration. The wife’s more arduous contribution has been accounted for by way of a 10 percent Kennon adjustment in the assessment of her contribution in this marriage. The diminution of assets has been accounted for by way of an add-back of $268,456. To also take this into account as a s75(2) consideration would be, in effect, double-counting. Nonetheless, even though I’m not prepared to make a s.75(2) adjustment in view of the matters referred to here, I accept that these are matters that are relevant to whether a separate s.75(2) adjustment should be made arising out of non-disclosure.
Having regard to all of the matters referred to above in the context of s.75(2) of the Act, I believe a s.75(2) adjustment in favour of the husband is warranted on the evidence and I believe that a 5 percent adjustment is called for. I therefore assess an adjustment in the husband’s favour of 5 percent for s.75(2) considerations.
As foreshadowed above, however, there is still the issue of adjusting for non-disclosure. I have made findings about credit and non-disclosure and the real uncertainty that exists in this case about the extent to which the husband has dissipated assets in the course of his gambling. I have already found that, in my opinion on the evidence, the husband has not properly disclosed his finances to the court so by giving him 60 percent, I am awarding to him 60 percent of known assets with a strong suspicion that there is more that he has not properly disclosed.
The true extent of his gambling losses is unknown. The add-back of $268,456 is, in my opinion, the only finding that was available on the evidence which attempts to quantify the diminution of matrimonial assets for gambling purposes. That is not to say that the husband did not lose more, but it is a recognition that there is insufficient evidence to establish how much more he lost. I recognise the Star City evidence suggests losses of $1.8 million, but that is evidence I cannot accept under the circumstances because, even if I took the case of both the husband and the wife at their very highest, and include everything they assert including compensation payments, the sale of Property C etc one could never find $1.8 million in assets that have been lost. Notwithstanding that, there are many uncertainties in this case, most of which could have been resolved if the husband had been more forthcoming in providing evidence.
The husband’s evidence leaves me with a profound sense of not really knowing how much he actually earns, spends, owns or the source of monies expended in gambling. He has failed in his disclosure to the Court. This is a s.75(2)(o) factor in favour of the wife. In this case it must be substantial. I therefore assess it at 15 percent.
Just and Equitable?
I have assessed contribution at 55:45 in favour of the husband, and have awarded him a further 5 percent in recognition of his needs under s.75(2). I have awarded the wife 15 percent under s.75(2)(o) This means that on the basis set out above, the husband and the wife would receive respectively a final alteration of property interests on the basis of 45:55 of the assets identified. Is this just and equitable under the circumstances?
A 55 percent property settlement gives to the wife the former matrimonial home at Property B, the furniture therein, her superannuation, and $195,122.35.
Giving 45 percent to the husband will give him over $312,098.65 in cash, and his motor vehicle and shares. He will need to
re-accommodate himself as well as to somehow provide for his own future in a situation where his entitlement to Centrelink benefits is unclear, and possibly uncertain. I am satisfied he has other undisclosed assets on which he can rely.
The foregoing discussion confirms in my mind that the making of the orders which I have contemplated above are just and equitable. It provides cash to the husband, no real estate, but leaves him with the benefit of all the many uncertainties in this case which are attributable exclusively to his actions, or inactions as the case may be. The wife, on the orders I propose, is left with some funds to provide for her future.
The amount of sale proceeds of Property F may have changed since the hearing and so the orders will express the parties’ share of the same in percentage terms to reflect this judgment.
The wife’s claim for 100 percent of the known assets was simply unrealistic in the circumstances of this case and seems to have been predicated on the Court focusing on the Star City business records which assert the husband lost $1.8 million in his gambling activities. To have accepted this figure, without reality testing it, however, would be artificial and misleading. The wife’s proposal in these proceedings seems to have ignored the reality that she herself admitted in evidence that the husband made a significantly greater financial contribution at the commencement of the marriage.
I have not forgotten the various interim distributions that have been made to the husband and the wife by way of orders during the course of these proceedings. I note that these substantially favour the wife over the husband. I believe that it is just and equitable to ignore these interim distributions and, in effect, leave them where they are. These proceedings were delayed as a result of conduct on the part of the husband i.e. non-disclosure and an adjournment of the hearing on his application. As a result of the husband’s non-disclosure the wife was clearly put to considerable cost and effort in providing evidence to the Court that the husband should have provided. In any event to further reduce the monies available to the wife in this case would, in my opinion, jeopardise the justice and equity of these orders from her perspective.
I certify that the preceding ninety-one (91) paragraphs are a true copy of the reasons for judgment of Altobelli FM
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