LACEY & LACEY - [2020] FamCAFC 73

FAMILY COURT OF AUSTRALIA

LACEY & LACEY

[2020] FamCAFC 73

FAMILY LAW – APPEAL – PROPERTY – Whether the primary judge failed to give proper, genuine and realistic consideration to the merits of the case – Whether the primary judge failed to provide adequate reasons – Challenges to the primary judge’s findings as to the respective contributions of the parties and the relevant factors under s 75(2) of the Family Law Act 1975 (Cth) – Where the grounds of appeal lacked merit – Where comprehensive reasons are not required because of the success of the cross-appeal – Appeal dismissed.

FAMILY LAW – APPEAL – CROSS-APPEAL – Where the primary judge did not consider the taxation consequences of the order made – Where the taxation consequences would lessen the parties’ share in their property interests – Where the primary judge could not be satisfied that the order was just and equitable – Where the wife was not precluded from raising this critical issue in the appeal despite not raising the issue at trial – Cross-appeal allowed – Matter remitted for rehearing – Scope of remitter not confined.

FAMILY LAW – APPEAL – APPLICATION IN AN APPEAL – ADDUCE FURTHER EVIDENCE – Where the error the subject of the cross-appeal is established without admitting the further evidence – Application dismissed.

FAMILY LAW – APPEAL – COSTS – Where the parties sought costs certificates – Where the error was precipitated by the parties’ mutual failure to address at trial the critical issue in the cross-appeal – Applications dismissed.

Family Law Act 1975 (Cth) ss 75(2), 79, 90AE(2)(b), 90AE(3), 90AE(4), 93A(2), 94(2), 94AAA(6)
Federal Proceedings (Costs) Act 1981 (Cth)
Income Tax Assessment Act 1936 (Cth) Division 7A

Allesch v Maunz (2000) 203 CLR 172; [2000] HCA 40
CDJ v VAJ (1998) 197 CLR 172; [1998] HCA 67
Gallieni & Gallieni [2012] FamCAFC 205
Ruscoe and Walker (2002) FLC 93-093; [2001] FamCA 268
Singh v Minister for Immigration and Border Protection (2018) 261 FCR 556; [2018] FCAFC 52
Stanford v Stanford (2012) 247 CLR 108; [2012] HCA 52

APPELLANT/CROSS-RESPONDENT:

Mr Lacey

RESPONDENT/CROSS-APPELLANT:

Ms Lacey

FILE NUMBER:

NCC

1128

2011

APPEAL NUMBER:

EAA

139

2018

DATE DELIVERED:

3 April 2020

PLACE DELIVERED:

Adelaide

PLACE HEARD:

Sydney

JUDGMENT OF:

Strickland, Ainslie-Wallace & Austin JJ

HEARING DATE:

2 July 2019

LOWER COURT JURISDICTION:

Federal Circuit Court of Australia

LOWER COURT JUDGMENT DATE:

5 October 2018

LOWER COURT MNC:

[2018] FCCA 1551

REPRESENTATION

COUNSEL FOR THE APPELLANT/

CROSS-RESPONDENT:

Mr Coleman SC

SOLICITOR FOR THE APPELLANT/

CROSS-RESPONDENT:

Palmers Solicitors

COUNSEL FOR THE RESPONDENT/

CROSS-APPELLANT:

Mr Page QC with Mr Boyd of counsel

SOLICITOR FOR THE RESPONDENT/

CROSS-APPELLANT:

Bell & Johnson Solicitors

Orders

The Application in an Appeal filed by the respondent/cross-appellant on 17 June 2019 and the Response thereto filed on 20 June 2019 be dismissed.
The appeal be dismissed.
The cross-appeal be allowed.
The orders made on 5 October 2018 be set aside.
The proceedings be remitted to the Federal Circuit Court of Australia for rehearing by a judge other than the primary judge.
There be no order as to costs.
The oral applications of the parties for costs certificates be dismissed.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Lacey & Lacey has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY

Appeal Number: EAA 139 of 2018
File Number: NCC 1128 of 2011

Mr Lacey

Appellant/Cross-Respondent

And

Ms Lacey

Respondent/Cross-Appellant

REASONS FOR JUDGMENT

Introduction

By way of Notice of Appeal filed on 30 October 2018, Mr Lacey (“the husband”) appeals from final property settlement orders made by a judge of the Federal Circuit Court of Australia on 5 October 2018.
In his Summary of Argument filed on 14 June 2019, the husband sought to recast the grounds of appeal such that there were two new grounds of appeal, with the existing Grounds 2 to 11 becoming the particulars of those two new grounds. No Amended Notice of Appeal was filed by the husband, but no objection was taken to him relying on these new grounds.
Ms Lacey (“the wife”) opposed the appeal, and by Notice of Cross-Appeal filed on 12 November 2018, appealed from paragraph 1 of the orders made by her Honour. That paragraph provided for the husband to pay to the solicitors for the wife, or alternatively to do everything necessary to cause Company A (“the company”) to pay to the wife, the sum of $2,980,639.28.
The husband conceded the cross-appeal. He says that her Honour erred in the manner asserted by the wife, but for different reasons than those advanced by the wife.
The wife filed an Application in an Appeal on 17 June 2019 seeking leave to adduce further evidence in the cross-appeal. The husband filed a Response on 20 June 2019 seeking the dismissal of the wife’s Application, but seeking leave to adduce further evidence himself in the appeal.

Relevant Background

The husband was born in 1947 and was aged 69 years at the time of the trial.
The wife was born in 1952 and was aged 64 years at the time of the trial.
The parties were married in 1973 and they separated on a final basis in January 2010.
There were five children of the marriage, with two being deceased at the time of the trial, and the surviving three aged respectively 42 years, 41 years and 39 years.
When the parties married the husband owned a 25 per cent shareholding in the company. That company had been formed by the husband’s parents in 1960. The husband’s parents each held a 25 per cent shareholding, with the husband’s and his sister’s 25 per cent shareholding each being held in trust for them by the husband’s parents.
In about 1969 the company constructed the Business N at Town 1 (“Business N”).
Shortly after they married the parties moved into a cottage at Property A adjacent to the Business N (“Property A”).
The husband worked for the company throughout the marriage. He became the manager of the Business N in 1983.
The wife did some work at the Business N throughout the marriage, and was the primary homemaker and parent.
In the 1980s, the company purchased land on the outskirts of Town 1 on which it built Business O. That business was sold in February 2011 for $3,159,675.
In the 1990s, the company purchased the Y Bank buildings in Town 1 and Town 2 which it then leased back to the Y Bank.
The husband’s father passed away in 2004. Upon his father’s death, the husband inherited his father’s shares in the company.
In 2009, the husband entered into an agreement with his sister whereby he purchased her shares in the company and also became entitled to inherit his mother’s shares upon her death.
The wife commenced property settlement proceedings in May 2011.
Shortly after the proceedings commenced, the husband distributed the sum of $340,000 from the Company A Superannuation Fund between the parties’ then living four children.
On 8 October 2011, the wife filed an Application in a Case seeking interim property settlement orders.
On 24 November 2011, interim property settlement orders were made by consent such that the husband would pay the wife the sum of $375,000 within seven days of her vacating the Property A and, upon vacating, that he thereafter pay her the sum of $50,000 by instalments of $500 per week.
The wife used the $375,000 to purchase herself a property at Property E.
In March 2014, the husband’s mother died and the husband inherited her shares in the company. Thereafter he became the sole beneficial owner of the company.
In December 2014, the husband arranged for the wife to be paid her entitlement in the Company A No. 2 Superannuation Fund in the sum of $106,386.
On 19 January 2016, the primary judge made further interim orders that the wife be entitled to $1 million by way of partial property settlement. The husband’s appeal against that decision was withdrawn and the husband was ordered to pay interest on that sum in the amount of $22,076.50.
The wife used part of the $1 million to purchase an investment property in Town 3, to invest in Super Fund I, and to purchase a new car.
In April 2015, the parties jointly instructed Forensic Accountants to provide valuations of the company and the Company A Superannuation Fund. However, Ms D was unable to complete the valuation because the husband failed to comply with requests to supply information.
At the time of trial, the husband was still in control of the company and involved in the operation of the Business N.
The appealed orders required the husband to pay or to cause the company to pay the wife the sum of $2,980,639.28 within four months and otherwise declared the parties to be the sole owners of all other property and superannuation interests in their respective possession.
Those orders followed upon findings that the parties’ net assets, inclusive of superannuation, were worth slightly in excess of $10 million (at [58]–[59]). The primary judge also determined to notionally add-back to the husband’s existing property interests two separate amounts of $340,000 and $93,585.20 that he spent after separation (at [144], [173]–[177]). The primary judge concluded the parties’ contributions should reflect in entitlements of 60 per cent/40 per cent in the husband’s favour (at [261]), but then found that an adjustment in the wife’s favour under s 75(2)(o) of the Family Law Act 1975 (Cth) (“the Act”) was justified on account of the husband’s conduct, which was quantified at $140,620 (at [300]).
Consequently, the wife was entitled to assets and superannuation with a net value of $4,316,141.28 and, allowing for the property interests she already retained, it was necessary for her to receive a cash adjustment of $2,980,639.28 (at [305]).

The Cross-Appeal

Given the concession made by the husband, it is appropriate to address the cross-appeal first. That is because the outcome of the cross-appeal may render the fate of the appeal of only academic interest.

Ground 1

That the [primary judge] erred in failing to consider the taxation implications of the Orders dated 5 October 2018.

The contention of the wife was that given the husband had few assets of realisable value, aside from his shareholding in the company, the only source from which the order for payment to the wife could be met was the funds of the company. Thus, it is said, the order for payment was one made pursuant to s 90AE(2)(b) of the Act, which provides as follows:
(2)In proceedings under section 79, the court may make any other order that:
…
(b)alters the rights, liabilities or property interests of a third party in relation to the marriage.
It is asserted that the company is a third party and that the order “alters the rights, liabilities or property interests of [the company] in relation to the marriage”.
The effect of that is that s 90AE(3) of the Act would then apply, and pursuant to subsection (e), the Court can only make an order if “the court is satisfied that the order takes into account the matters mentioned in subsection (4)”.
The relevant subsections of s 90AE(4) for the purposes of this ground of appeal are subsections (a) and (b) which provide that two of the matters the Court must take into account are the taxation effects of the order on the parties, and on the third party.
Thus, it is contended that given her Honour did not take into account the taxation effect of the order on the parties and the third party, the order was not one that her Honour could make.
However, we disagree with that contention.
This is not a matter to which s 90AE(2)(b) of the Act applies.
The husband is the sole director and shareholder of the company, and there can be no doubt that the company is the alter-ego of the husband. Thus the property of the company is to be looked on as the property of the husband for the purposes of s 79 of the Act. As a result, the Court has the power to make an order directed to that property, and it is unnecessary to look to Part VIIIAA of the Act, or more specifically, s 90AE(2)(b) (Gallieni & Gallieni [2012] FamCAFC 205 at [88]–[94]).
It is noteworthy that s 90AE(2)(b) was not raised before the primary judge, and there was no requirement for her Honour to refer to that paragraph given the source of power for the order that her Honour made was Part VIII of the Act.
There is no merit in this ground of appeal.

Ground 2

That the [primary judge] erred by making the Orders which [her Honour] did on a final basis, as, in the absence of evidence regarding the taxation implications of the Orders sought, the [primary judge] could not determine if the Orders were Just and Equitable.

The same premise applies to this ground of appeal as to Ground 1, namely, given the husband had few assets of realisable value aside from his shareholding in the company, the amount to be paid to the wife would have to come in one way or another from the company. However, since the company did not have sufficient cash reserves to cover the payment, it would need to liquidate assets to raise cash, and thereby inevitably crystallise capital gains tax liabilities.
The difficulty though was that no evidence was led about these liabilities, her Honour saying:
313.… I was provided with absolutely no evidence about any taxation consequences of assets owned by [the company] being disposed of and I cannot take into account matters about which the parties provided no evidence.
However, the confluence of the respective financial circumstances of the husband and the company necessarily meant that the payment of the cash adjustment to the wife by the company would create liabilities of an unknown quantum which, at the very least, would reduce the value of the husband’s shareholding, and hence devalue his share of the parties’ property interests. Implementation of the order in that form would mean the husband would not receive the overall proportional share of the parties’ assets, to which the primary judge found he was entitled. For that reason alone, that necessarily meant the primary judge could not be satisfied that the appealed order was just and equitable, and thus the primary judge’s contrary finding – that the orders were just and equitable in those particular terms (at [301]) – was not open, and the orders are thereby vitiated.
From the wife’s point of view, and this was more the thrust of this ground of her cross-appeal, her receipt of cash from the company would probably be deemed as a dividend in her hands, and trigger a taxation liability under Division 7A of the Income Tax Assessment Act 1936 (Cth), because the husband is the sole shareholder in the company and, as his former spouse, she would be characterised as an “associated entity”.
Just as the imposition of capital gains tax liabilities would lessen the husband’s share of the parties’ property interests, the probable Division 7A taxation liability that would be imposed on the wife would lessen her share of those property interests.
Again though, no evidence was led at trial about this liability, and thus this adds to the submission that the primary judge could not be satisfied that the order was just and equitable.
It must be said though that the parties were at least partially responsible for leading the primary judge into this error, because neither of them presented any evidence as to the taxation consequences of the orders that were being sought by each of them. Additionally, it does not sit particularly well from the wife’s point of view, for her to pursue this ground of appeal, when the impugned order was in similar terms to the order that she sought, yet she presented no evidence of the taxation consequences of making that order.
Nevertheless, because the error is legal rather than factual, the wife is not precluded from raising or relying upon the error in the cross-appeal.
Further, although the issue of the taxation consequences of the order sought by the wife were not raised during the trial, the authorities indicate that leave to argue a ground of appeal not raised before the primary judge should be permitted if it is expedient in the interests of justice to do so, and more particularly, if the point has merit and there is no real prejudice to the other party (Singh v Minister for Immigration and Border Protection (2018) 261 FCR 556 at [57]). That is the case here.
In these circumstances there is merit in this ground.

Ground 3

That the [primary judge] erred in Order 1 by leaving to the discretion of the respondent husband, the source of the payment to the wife, and consequently, the taxation implications of the Orders dated 5 October 2018.

This is a ground that cannot succeed.
In the wife’s Outline of Case documents she included a Minute of the Orders that she sought, and one was as follows:
Within 56 days the husband do all acts and execute all documents to cause [the company] to pay to the solicitors for the wife, and on her behalf, the sum of $2,759,000 by way of property settlement between the parties.
…
Certainly, in the order the primary judge made, her Honour did, in effect, leave it in the discretion of the husband to either pay the amount personally, or cause the company to pay it, but the only taxation consequences for the wife, and which are the basis for the cross-appeal, are those that would flow from the company making the payment, namely, the order that she sought.
There is no error here by the primary judge separate from the error identified in Ground 2.

Outcome of the Cross-Appeal

Given we have found merit in Ground 2, the cross-appeal must be allowed and paragraph 1 of the orders made by her Honour should be set aside.
Plainly, given the nature of the error, it is not open for this Court to re-exercise the discretion, and thus the matter needs to be remitted to the Federal Circuit Court of Australia for rehearing by a judge other than the primary judge. However, that then brings us to the only dispute between the parties in relation to the cross-appeal, namely whether the legal error identified requires the remitter of their respective applications for property settlement for rehearing on all issues, or limited to a determination of the quantum of the actual and prospective taxation liabilities borne by the parties and the company.
The terms of s 94AAA(6) (and s 94(2) when relevant) of the Act are wide enough to permit the imposition of conditions limiting the scope of any re-hearing (Ruscoe and Walker (2002) FLC 93-093) but, as the husband submitted, the re-hearing in this instance should be unconfined. Both parties are entitled to adduce updated evidence in the re-hearing (Allesch v Maunz (2000) 203 CLR 172 at 183, 191-192), which is especially pertinent here because the evidence before the primary judge was only current to March 2017 and is now stale by nearly three years. In the re-hearing, the parties’ applications for property settlement must be determined by reference to all the mandatory statutory considerations in light of the then current value of their assets and liabilities, which liabilities will include the actual or prospective taxation debts each of them will incur pursuant to the intended final property orders. To do otherwise, and limit the remitter, would constrain the ability of the new judge to do what Stanford v Stanford (2012) 247 CLR 108 says a judge has to do.
The wife asserted in paragraph 22 of her Summary of Argument filed on 17 June 2019:
The taxation consequences for the wife, should the husband [pay her cash adjustment from the corporation’s assets] were unforeseen, and will substantially affect the whole basis of the property adjustment ordered by the [primary judge].

If the wife accepts that, in the re-hearing, the form of the final property settlement orders and the taxation consequences of the parties’ compliance with them will “substantially affect the whole basis of the property adjustment” process, then it follows that she must also accept the re-hearing of their applications should not be artificially confined.
Given the rehearing needs to be of the entire proceedings, paragraph 2 of the orders made should also be set aside. That paragraph provided as follows:
Upon this order being carried into effect each party is declared the owner to the exclusion of the other of all property and superannuation in the possession of or standing in the name of the other party.

The Application in an Appeal and the Response thereto

Before considering the appeal, it is appropriate to address the Application in an Appeal filed by the wife seeking leave to adduce further evidence, and the Response to that application filed by the husband.
The wife sought to introduce evidence procured by her after the trial, as to the taxation consequences upon her, of the order under appeal. However, it is unnecessary to receive that further evidence, even if it could be admitted under the principles established in CDJ v VAJ (1998) 197 CLR 172; the error asserted in Ground 2 of the cross-appeal is established without it.
Thus this Application in an Appeal will be dismissed.
As for the Response filed by the husband, that should also be dismissed.
First, the husband sought to lead evidence as to the taxation consequences for him and the company if the adjusted order that the wife sought in her cross-appeal was made. However, as we have explained, this Court will neither re-exercise the discretion and make the order sought by the wife, nor limit the remitter in any way. Thus, there is no utility in admitting that evidence.
Secondly, the husband sought to adduce fresh evidence about the current value of the company’s assets, but, in reality, that was an application to adduce updated evidence on the rehearing, rather than an application to adduce further evidence in the appeal, under s 93A(2) of the Act to demonstrate error by the primary judge.

The Appeal

The husband agitated 16 grounds of appeal in his Notice of Appeal, but in his Summary of Argument filed on 14 June 2019, the husband abandoned Ground 1 and Ground 16. Grounds 2 to 11 challenged the primary judge’s assessment of the parties’ respective contributions, and Grounds 12 to 15 challenged the adjustment made by her Honour under s 75(2) of the Act.
To repeat, at the hearing of the appeal, the husband was granted leave to substitute two new grounds of appeal for Grounds 2 to 11, with Grounds 2 to 11 to be considered as particulars of the two new grounds. The two new grounds are as follows:
a)The primary judge erred in principle by failing to give proper, genuine and realistic consideration to the merits of the case, and/or
b)The primary judge failed to adequately reveal the process of reasoning by which her Honour [sic] the entitlements of the parties to their property.
It is appropriate to address these two new grounds of appeal first, although to repeat, there is no need to provide comprehensive reasons in relation to any of the grounds of appeal, since the success of the cross-appeal means the appealed orders will be set aside, and the parties’ applications remitted for rehearing in any event.
The two new grounds of appeal are said to be complementary in that if (a) is made out, then that may be because of (b) being made out, if (b) is made out, then (a) would be made out as well.
It is said, accurately, that her Honour’s delay in delivering judgment (approximately 15 months), exposes her Honour’s reasons to closer than usual scrutiny, but here, even without that scrutiny, the reasons are asserted to be inadequate.
Further, it is submitted that adopting a global approach, as her Honour did, rather than an asset by asset approach, led her Honour into error, by diverting her Honour away from properly considering the merits of the case.
The central proposition advanced by the husband was that approximately $6 million or 66.6 per cent of the parties’ property was referrable to “inheritances” received by the husband, relatively late in the marriage or after separation, and these primary facts called for “proper, genuine and realistic consideration”, but that is not apparent from her Honour’s reasons.
It is said that the primary judge’s rejection of the submission by the husband that his shareholding in the company should be “quarantined” did not derogate from the obligation to give “proper, genuine and realistic consideration to the merits of the case, having regard to how the [husband] acquired those interests, when he did relative to the parties’ cohabitation, and their nature, quality and characteristics”.
The submission is that her Honour failed to recognise the real impact of first, the husband’s initial contribution of his 25 per cent shareholding in the company, and secondly the contribution of 66.6 per cent of the share capital by the husband’s parents on behalf of the husband.
In short, the husband asserts that no part of her Honour’s consideration of these issues engaged with the “contribution controversies” identified in the particulars comprised in former Grounds 2 to 11.
However, we do not accept these submissions of the husband, and we consider that her Honour gave “proper, genuine and realistic consideration to the merits of the case”, and adequately revealed the process of reasoning by which her Honour arrived at the findings as to the respective entitlements of the parties to their property.
We find that the primary judge gave adequate consideration to the husband’s evidence and submissions. Her Honour took into account the parties’ respective initial contributions (at [26], [29], [193]–[195], [253]) and properly recognised that the company, in which the husband progressively acquired sole and exclusive shareholding, was the vehicle through which a business was conducted to generate the family’s income and capital wealth (at [35], [255]). As is orthodox and as was open, her Honour took a global approach to the assessment of the parties’ contributions, rejecting the asset by asset approach (at [189]–[192], [196]–[250]), and in that process did not overlook the interim distributions of property to the wife following the parties’ separation and during the course of the litigation (at [38], [43], [47]–[50], [302]–[304]).
The primary judge adequately dealt with the submission that the husband’s shareholding, or at least part of it, should be quarantined at [232]–[256], and specifically in relation to that shareholding, said this in her conclusions on contributions:
253.What I do know is that the husband had a 25% interest in [the company] in 1983 when the parties married and was assured of inheriting a further interest in the company from his parents although at that stage his sister’s future entitlement would have been unclear. As a result he devoted all his time and effort during the marriage to [the company]. He and the wife never looked anywhere else or attempted to acquire any other property and this can only be because the husband was confident that working hard in the company would deliver a financial benefit to the parties.
254.Careful reflection on this aspect of the matter reinforces why it would be quite wrong to treat the three separate shareholdings in [the company] differently. The husband did not simply bring into the marriage a 25% shareholding in [the company]; he brought in a 25% shareholding and a belief which turned out to be correct that one day the entire shareholding in the company would be his. He was not entitled to the other shares at the commencement of the marriage but this belief shaped the way the parties contributed during the marriage and the way they acquired or did not acquire other assets.
255.There is considerable force in the following from the wife’s case outline document:
Apart from their children, it is clear that all of the fruits of the parties’ long labour and commitment ended up in one place – the family company.
(As per original) (Footnote omitted)
Her Honour satisfactorily explained her assessment of the parties’ contributions insofar as they reflected in a 60 per cent/40 per cent division of property (at [251]–[261]).
The primary judge is criticised for indicating in her conclusion on contributions that “the court must take an intuitive leap and assess contributions overall” (at [258]). However, it is clear from her Honour’s reasons that she first laid the groundwork for making that inevitable leap from qualitative to quantitative assessment, and finding there should be a 60 per cent/40 per cent division in favour of the husband.
Thus, we find no merit in the two new grounds of appeal.

Grounds 12 to 15

In applying the provisions of S. 75(2) Family Law Act, 1975, as amended, the learned Primary Judge erred (J.278 – 284) in making an adjustment in the Wife’s favour of $140,620, such adjustment being in fact a penalty imposed by Her Honour upon the Husband. (Ground 12)

In applying the provisions of S. 75(2) Family Law Act, 1975, as amended, the learned Primary Judge erred (J.66 – 97) in failing to give due weight to the uncontested evidence before her that the principal asset in which the parties or either of them held interests, the Business N at Town 1, had failed as a business and had ceased to be a viable commercial entity. (Ground 13)

The learned Primary Judge erred in failing to make adjustment under Section 75(2) Family Law Act, 1975, in consequence of the evidence before her as to the Husband’s state of ill health, and the probable cost of his future medical treatment. (Ground 14)

The learned Primary Judge erred (J.303 – 304) in declining to give effect to express representations made by the Wife, and relied upon the Husband, that amounts paid to her by the Husband post separation were accepted by the Wife in part settlement of her rights to property adjustment under S. 79 Family Law Act, 1975, as amended. (Ground 15)

There was a decided dearth of submissions from the husband in relation to these grounds of appeal, the concentration in the appeal being on the grounds challenging the contribution findings of the primary judge.
Again though, in the circumstance of the success of the cross-appeal, we do not propose to provide comprehensive reasons in addressing these grounds.
In summary, we consider that her Honour satisfactorily, and without error, explained her assessment of the adjustment in the wife’s favour under s 75(2) of the Act (at [262]–[301]).
Her Honour adequately addressed and dealt with all of the issues raised in these grounds of appeal. For example, in relation to Ground 13 her Honour said this:
285.The husband’s counsel also raised an issue about the value of the [Business N] although in light of the husband’s failure to co-operate with the valuation process it was a cheeky submission. He submitted that the [Business N] was no longer a profitable business and was losing up to $200,000.00 per annum. He asserted that:
Common sense is that this will, in all probability, have a negative impact on the [Business N’s] sale value, and the overall value of the asset pool.
286.The husband’s counsel submitted that I must accept the husband’s assertion that the [Business N] was losing money because the wife did not challenge it at trial. The wife did not however accept it either and a bare assertion by the husband does not gain strength because the wife fails to mount a case to disprove it, especially in circumstances where husband has control of the business and possession of all the relevant documents.
287.If the husband had wanted to dispute the value of the [Business N] in the 2016 balance sheet or suggest that it was losing money he should have co-operated in an updated valuation of the [Business N] being prepared by [the valuers] by supplying them with necessary documents. In February 2017 the husband had still not provided this data and [the valuers] were unable to complete their valuation prior to the trial. I can place absolutely no weight on his assertion that the [Business N] is worth less than the figure in the agreed balance sheet.
(As per original) (Footnote omitted)
There is no merit in these grounds of appeal.

Conclusion as to the appeal

Given that we have found no merit in any of the grounds of appeal, the appeal must be dismissed.

Costs

The parties did not seek costs. Given the husband’s concession of the wife’s cross-appeal by reason of legal error, the parties sought costs certificates under the Federal Proceedings (Costs) Act 1981 (Cth) for both the appeal and the re-hearing. In the exercise of discretion, such certificates should be refused. The identified error was precipitated by the parties’ mutual failure to address at trial before the primary judge the critical issue in the cross-appeal.

I certify that the preceding ninety two (92) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Strickland, Ainslie-Wallace and Austin JJ) delivered on 3 April 2020.

Associate:

Date: 3 April 2020