Lasko & Lasko
[2021] FedCFamC2F 183
•16 September 2021
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Lasko & Lasko [2021] FedCFamC2F 183
File number(s): MLC 11649 of 2020 Judgment of: JUDGE BENDER Date of judgment: 16 September 2021 Catchwords: FAMILY LAW – PROPERTY – The Wife’s application for property orders – the Husband is no longer participating in proceedings and has not filed trial material.
HELD – Leave granted to proceed on an undefended basis – the Husband to pay the sum of $122,393 to the Wife and in default of payment the former matrimonial home to be sold – the parties otherwise retain assets in their name and possession including motor vehicles and superannuation entitlements.
Legislation: Family Law Act 1975 (Cth), ss 75(2), 79(1), 79(2), 79(4) Cases cited: Stanfordv Stanford [2012] HCA 52
Hickey& Hickey [2003] FamCA 442
Bevan & Bevan [2013] FamCAFC 116Division: Division 2 Family Law Number of paragraphs: 79 Date of hearing: 16 September 2020 Place: Melbourne Counsel for the Applicant: Mr Stanley Solicitor for the Applicant: Morrison and Sawers Counsel for the Respondent: The Respondent did not appear ORDERS
MLC 11649 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2) BETWEEN: MS LASKO
Applicant
AND: MR LASKO
Respondent
ORDER MADE BY:
JUDGE BENDER
DATE OF ORDER:
16 SEPTEMBER 2021
THE COURT ORDERS THAT:
1.The Husband pay to the Wife the sum of $122,393.00 (“the payment”) on or before 18 October 2021 (“the date”).
2.Contemporaneously with the payment:
(a)the parties do all such acts and things and sign all such documents as may be required for the Wife to transfer to the Husband at the expense of the Husband all of her right, title and interest in the real property situate at and known as B Street, Town C in the State of Victoria (“the real property”); and
(b)the Husband indemnify the Wife against all payments and liability pursuant to the Bank D mortgage secured by the real property (“the mortgage”) and all apportionable rates, taxes and like apportionable outgoings of or with respect to the real property of whatsoever nature and kind.
3.In the event that the whole of the payment has not been made by the date, the real property be sold forthwith altogether out of Court (“the sale”) and upon completion of the sale, the proceeds of sale shall be applied:
(a)firstly to pay all costs, commissions and expenses of the sale;
(b)secondly to discharge the mortgage and any other encumbrances affecting the real property;
(c)thirdly of the balance then remaining:
(i)50% to the Wife plus the sum of $16,805.00 which is to be paid from the Husband’s share of the proceeds of sale; and
(ii)50% to the Husband less the sum of $16,805.00 which is to be paid to the Wife.
4.Pending the completion of the sale:
(a)the Husband pay all instalments pursuant to the mortgage and all rates, taxes and like apportionable outgoings of the real property as they fall due;
(b)the Husband vacate the property within sixty (60) days of the date of these Orders;
(c)the parties hold their respective interests in the real property upon trust pursuant to these orders; and
(d)neither party encumber the real property without the consent in writing of the other party.
5.The sale shall be by private treaty with such real estate agent as is agreed between the parties and failing agreement within fourteen (14) days of the Husband failing to make the whole of the payment by the date the real estate agent will be as nominated by the Real Estate Institute of Victoria at the request of the parties or either of them (“the real estate agent”).
6.The list price of the real property shall be such amount as is agreed between the parties and failing agreement within fourteen (14) days of the Husband failing to make the whole of the payment by the date the list price will be as nominated by the real estate agent.
7.The sale price of the real property shall be such amount as is agreed between the parties and failing agreement any offer to buy the property that is at least 90% of the list price shall be accepted by the parties as the sale price.
8.The parties are to co-operate in every way with the real estate agent in relation to the sale including making the key readily available and ensuring the real property is maintained in good order and is neat and clean at the time of inspection by any prospective buyer.
9.Upon agreement being reached for the sale of the real property the parties shall execute the contract of sale and all other documents necessary to complete the sale of the real property including all transfer documentation forthwith upon its submission to them by the agent or their solicitor.
10.The contract of sale shall provide for completion within thirty (30) days after the date of the contract.
11.Liberty be reserved to either party to apply with respect to the terms and conditions of and the execution of the sale and if the Husband fails to comply with orders 4(b) or 8 herein.
12.The Wife forthwith do all acts and sign all documents as are necessary to:
(a)re-register the companies Company E and Company F (“the companies”);
(b)appoint the Wife as public officer of the companies and authorise the Wife absolutely to do all such things necessary to complete, sign and lodge financial returns for the companies; and
(c)wind up the companies.
13.The funds held in the Cosgriff Lawyers Trust Account be released as follows:
(a)firstly the sum of $5,000.00 to Morrison & Sawers Lawyers to be held in trust to be utilised by the Wife to pay any fees and costs associated with re-registering the companies, lodging the financial returns of the companies and winding up the companies pursuant to order 12 herein;
(b)secondly of the balance then remaining:
(i)50% to the Wife; and
(ii)50% to the Husband.
14.Any monies remaining from the funds held in trust by Morrison & Sawers following the payment in order 13(a) herein after the companies have been wound up pursuant to order 12(c) herein be divided equally between the parties.
15.Pursuant to s.106A of the Family Law Act 1975 (Cth) in the event either party refuses or neglects to do all acts and things and execute all such documents as are necessary to give effect to these orders within 14 days of being requested to do so by the other party’s legal representative:
(a)a Registrar of the Federal Circuit and Family Court of Australia be appointed pursuant to s.106A of the Family Law Act 1975 (Cth) to give effect to the orders made herein; and
(b)for the purposes of this order, an affidavit setting out the non-complying party’s failure to comply with the orders shall be sufficient evidence of neglect or default; and
(c)the non-complying party pay all reasonable costs incurred by the other party for the purposes of enforcing this order.
16.Pursuant to s.106A of the Family Law Act 1975 (Cth) the Wife and/or her solicitors be authorised to execute all documents in the name of and on behalf of the Husband as are required to give effect to the sale, including but not limited to:
(a)all Duties Online forms required to be signed by the Husband relating to a transfer in ownership of the real property; and
(b)all PEXA authorisations required to give effect to the electronic settlement for transfer of ownership in the real property.
17.For the purpose of order 15 and 16 herein, evidence of non-compliance is to be provided by way of affidavit only.
18.In the event the Wife is required to exercise the provisions of orders 15 and 16 herein, Morrison & Sawers Lawyers be appointed as agent for the Husband for the sole purpose of the sale of the real property and Morrison & Sawers Lawyers be and are hereby authorised to sign a client authorisation form to enable the sale of the real property on behalf of the Husband.
19.The Wife retain for her sole use and benefit absolutely:
(a)her personal Bank G and Bank H accounts; and
(b)the Motor Vehicle 1.
20.The Wife be responsible for and indemnify the Husband absolutely with respect to the finance associated with the Motor Vehicle 1 and her personal debt to the Australian Tax Office.
21.The Husband retain for his sole use and benefit absolutely:
(a)funds held in the joint ANZ bank account;
(b)his personal bank accounts;
(c)the boat;
(d)the tandem trailer and box trailer;
(e)his tools and equipment;
(f)the Motor Vehicle 2; and
(g)the motorbike.
22.Unless otherwise specified in these orders and except for the purposes of enforcing the payment of any money due under these or any subsequent orders:
(a)each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession of such party as at this date. The furniture, personal possessions and like chattels in the matrimonial home are considered to be in the possession of the Husband;
(b)each party hereby foregoes any claim they may have to any superannuation benefits belonging to or earned by the other;
(c)all insurance policies to become the sole property of the beneficiary named therein;
(d)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders; and
(e)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
23.The Wife’s solicitors forthwith forward a copy of these orders to the Husband by email to … .com.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym Lasko & Lasko has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
(Revised from Transcript)JUDGE BENDER:
INTRODUCTION
This matter relates to an Application filed by the Wife seeking property orders following the breakdown of the parties’ very lengthy relationship of 27 years.
Initially, the Husband participated in the proceedings. He had legal representation and he filed a Response and answering material seeking orders be made to adjust the parties’ equitable property interests and finalise their financial affairs.
The matter first came before Registrar Mathews on 27 January 2021. On that occasion orders were made for the parties to attend a Conciliation Conference on 15 April 2021 and the matter was listed for final hearing on 13 August 2021 with the standard trial directions being made. Orders were also made by consent which made provision for partial distributions of the proceeds of sale of a property that had been sold by the parties owned by their trading companies Company E and Company F (“Company F”). The Registrar also made orders that all necessary things be done to enable Company F and its various entities to have its taxation matters finalised and then for it to be wound up.
The Registrar also made orders for full and frank disclosure as between the parties.
The matter proceeded to a Conciliation Conference on 15 April 2021. By this date the Husband was no longer represented. He failed to appear. Consequently, Registrar Mestrovic made orders fixing the Wife’s costs of that day in the sum of $2,500. It was also noted that the Husband had failed to contribute his share of the cost of the valuation of the former matrimonial home at B Street, Town C (“former matrimonial home”).
The matter came before me on 13 August 2021 for final hearing.
On that occasion the Husband did not appear and had not filed his trial material. It was apparent from the representations made on behalf of the Wife that the Husband was fully aware of the orders made and that he had no intention of participating in the proceedings.
I was encouraged on that occasion to proceed to hear the matter on an undefended basis but was of the view that the Husband needed to be properly afforded procedural fairness and to have it made very clear to him what would be the reality of his continuing to fail to participate in the proceedings. I also wanted to be fully satisfied that the Husband was cognisant of the orders that were being sought by the Wife in the event he failed to participate.
On 13 August 2021 I made orders adjourning the matter to today. I gave the Husband one more chance to file trial material. I ordered that in the event the Husband did not file any material and/or appear on the adjourned date the matter would proceed today on an undefended basis and the Wife would have leave to seek orders in the terms set out in both her trial affidavit filed 20 July 2021 and her Outline of Case filed 12 August 2021.
On 13 August 2021 I also reserved the Wife’s costs in the sum of $3,500 to today and made orders in relation to requirements for service. Those requirements as to service in the whole have been complied with and it is very apparent that the Wife’s solicitors have done everything they could be possibly asked to do to have the Husband participate in these proceedings.
Today the Husband has not filed any further material, he has failed to appear and, therefore, I intend to proceed with this matter on an undefended basis.
BACKGROUND
The Wife was born in 1972. She is 49 years of age. The Wife is employed as a Manager, earning approximately $89,000 per annum.
The Husband was born in 1973. He is 48 years of age. He is employed as a labourer earning approximately $64,000 per annum.
The parties commenced cohabitation in 1992. They married in 1994 and separated on 3 February 2019.
The parties have three adult children; Ms J, who is now 25, Mr K who is 24 and Ms L who is 22.
When the parties commenced cohabitation they were 20 and 19 years of age respectively and neither of them had assets of any great significance.
In or around 1994, the Husband was paid the sum of $80,000 as an entitlement pursuant to beneficiary loans from his parents. Those funds were applied by the parties as a deposit for the purchase of a farm in Town M.
In or around 1999-2000, the parties received a net distribution of $1,000,000 from the Husband’s parents’ family trust. Those funds, together with the proceeds of sale of a property that they owned jointly in Suburb N in the sum of approximately $150,000, were applied to purchase a functioning dairy farm at O Street, Town C, together with stock and equipment. The remainder of the purchase price for this farm was by way of mortgage.
Throughout the relationship the Husband suffered from mental health issues and in particular, serious depression. That, together with the drought and the cutting of milk prices resulted in the farm running at a loss other than in its first year of operation.
During this period, the Wife was responsible for the practical and emotional tasks of raising and providing for the parties’ three children, running the household and at times taking over the responsibility of the farm in lieu of the Husband when his illness made it impossible for him to run the farm himself.
The farm did not generate sufficient income to support the family. In or around 2006, the Wife started working part-time away from the farm in an attempt to generate income to support the family. She also continued to assist on the farm and was the primary carer and homemaker for the parties and their three children.
In or around 2007-2008, the Husband’s parents gifted the parties a further sum of $350,000 to assist them and reduce the financial pressures that had arisen, in part from the difficulties the Husband had in functioning on a day-to-day basis. Those funds were used to pay some of the parties’ debts and reduce the parties’ creditors.
In 2009-2010, the parties sold permanent water rights, again to reduce debt. During this period the Husband unilaterally made the decision to sell the dairy herd and invest in beef cattle.
In 2011 there was a flood and much of the infrastructure on the farm was badly damaged. At this time the Wife had completed all necessary studies to qualify as a professional. She established her own business. She was working away from the farm and running her business on a full-time basis as well as assisting on the farm when she got home from work and on weekends.
After the flood, the beef cattle were sold and the Husband again returned to dairy farming. Approximately $300,000 was required to replenish the dairy herd and purchase additional machinery. Additional loans were taken out to effect repairs to the infrastructure that was damaged by the flood.
Sadly, in 2012-2013 the Husband’s mental health declined considerably. He stopped milking the cows and as a result the herd went dry. The herd that was previously purchased for approximately $300,000 was sold for $80,000. Around this time, the Wife’s parents gifted the parties $40,000 to assist them whilst they placed the farm on the market for sale.
The farm and farming business was sold and settled in 2014. The net position of the parties after the payment of their liabilities was realistically nil.
The parties elected not to discharge their quite considerable credit card debts at that time. Instead they used the monies from the sale of the farm that would have discharged their credit card debts to pay a deposit on the former matrimonial home at B Street, Town C (“the former matrimonial home”). The remainder of the purchase price was obtained by way of a mortgage secured over the former matrimonial home.
Following the purchase of the former matrimonial home, the Wife continued to operate her business and the Husband obtained employment in the farm.
The parties separated on 3 February 2019. The Husband remained in the former matrimonial home and the Wife moved into rental accommodation. By this stage the parties’ three children were all adults and living independently.
Following separation, it is the Wife’s belief that the Husband broke into her work premises and stole her work computer. As all her client’s records were on this computer, her capacity to continue to conduct her business was rendered impossible.
As previously noted, the parties’ farming enterprises were conducted through a company/trust structure called Company F. At the time of separation Company F’s assets consisted of a property at Q Street, Town C, some motor vehicles and a small amount of plant and equipment.
Following separation, the property at Q Street, Town C was sold by agreement.
On the first return date of this matter the parties reached interim agreement as to the distribution of the net proceeds of sale of the property at Q Street, Town C. The parties each received $20,000 by way of part property settlement, outstanding rates on the former matrimonial home were paid and the balance of $24,193.84 remain in the conveyancer’s trust account.
The parties also agreed to the sale of some plant and equipment and for the proceeds to be divided equally between them.
The necessary tax returns and other documentation required to wind up Company F had been prepared by the Wife and submitted to the Husband for signature prior to the first return date. The Husband refused to sign those documents. Therefore, consent orders were made by Registrar Matthews on 27 January 2021 that provided for an independent accountant to prepare those documents. This was not able to be completed as the Husband again refused to cooperate in the process. Because certain fees had not been paid and certain matters had not been attended to, the Australian Securities and Investments Commission deregistered Company F. This has made it even more difficult to effect the finalisation and winding up of Company F.
THE LAW
Section 79 of the Act defines the Court’s powers in determining applications for property settlement after the breakdown of a marriage. Section 79(2) of the Act provides that:
(2)The court must not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
Section 79(4) of the Act sets out the matters the Court must take into account when considering what orders should be made for the alteration of the interest of the parties in property. Those matters are:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
(f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
The matters to be taken into account under s.75(2) of the Act are as follows:
(a) the age and state of health of each of the parties; and
(b) the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i) himself or herself; and
(ii) a child or another person that the party has a duty to maintain; and
(e) the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii)any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party; and
(g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha) the effect of any proposed order on the ability of a creditor of a party to recover the creditor's debt, so far as that effect is relevant; and
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party's role as a parent; and
(m)if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n) the terms of any order made or proposed to be made under section 79 in relation to:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
(naa)the terms of any order or declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i) a party to the marriage; or
(ii) a person who is a party to a de facto relationship with a party to the marriage; or
(iii) the property of a person covered by subparagraph (i) and of a person covered by subparagraph (ii), or of either of them; or
(iv) vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement that is binding on the parties to the marriage; and
(q)the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage.
The High Court in the matter of Stanfordv Stanford [2012] HCA 52 held that, prior to making orders that adjust any interest in the property in which the parties have an equitable interest in accordance with the provisions of the Act, the Court must first determine that it is just and equitable to make such orders. The High Court in Stanford (supra) held that in the majority of matters, the decision as to whether it is just and equitable for the Court to make orders adjusting the parties property interests is resolved by the breakdown of the marital relationship and the mutual desire of both parties for orders altering their respective property interests.
Given the Husband’s failure to continue to participate in these proceedings, there is not currently a mutual application before the Court by the parties to alter their property interests. It is apparent that in circumstances where the only asset of the parties is held jointly and there has been a breakdown of the relationship, it is just and equitable that orders be made that enable a finalisation of the parties’ financial relationship so that they can move on independently of each other.
I am therefore satisfied that it is appropriate I should be making orders that alter the parties’ equitable property interests.
Prior to the decision in Stanford (supra), a trial judge would in most cases follow the four-step approach in determining how to alter property interests between the parties as articulated in the Full Court decision of Hickey& Hickey [2003] FamCA 442. The four-step process in Hickey is as follows:
(a)firstly, the court will determine the nature of the property pool and attribute valuations;
(b)secondly, the court will consider the contributions of the parties to the property pool, including direct and indirect financial contributions, and non-financial contributions, often in the form of homemaker and parent;
(c)thirdly, after considering entitlements based on contributions, the court determines whether any further adjustments to either party’s entitlement is proper given the considerations under s.90SM(4) of the Act;
(d)finally, the court stands back and considers whether the proposed division of property is just an equitable pursuant to s.90SM(3) of the Act.
The High Court in Stanford (supra), and subsequently the Full Court in the matter of Bevan & Bevan [2013] FamCAFC 116, neither approved nor disproved this four-step approach. The Full Court in Bevan (supra) noted the four-step approach should not be rigidly followed but it does provide a useful guide to a Court when it is determining the division of property between the parties once the Court is satisfied that such a division is just and equitable.
I am satisfied that this is a matter where the four-step approach of Hickey (supra) is the appropriate approach to take to determine a just and equitable division of property between the parties.
ASSETS AND LIABILITIES
The parties’ assets and liabilities are set out in the Outline of Case that has been filed on behalf of the Wife. I adopt that document as an accurate reflection of the parties’ assets and liabilities for the purposes of determining a just outcome in this matter:
47 ASSETS
Personal Assets Ownership H’s value W’s value Source of Valuation B Street, Town C Joint $390,000 $390,000 P Valuers valuation dated 13 April 2021 Boat Husband $7,250 $7,250 Agreed Trailer Husband $800 $800 Agreed Box Trailer Husband $500 Tools Husband $1,420 $10,500 Bird Cages Husband $1,600 $1,600 Agreed Shipping Container Husband $2,000 $2,000 Agreed Funds retained by Husband from Company F Pty Ltd account at separation Husband $3,958 Ms Lasko Business Wife $16,000 NIL Motor Vehicle 1 Wife $25,000 $25,000 Agreed Trailer Wife $500 $500 Agreed ANZ Account …07 Joint $282 Bank Statement Bank G Account …40 Wife $3,784 Bank Statement Bank G Account …20 Wife $525 Bank Statement Bank G Account …20 Wife $203 Bank Statement Bank G Account …51 Wife $855 Bank Statement Bank G Account …56 Wife $215 Bank Statement Bank H Account …52 Wife $18 Bank Statement Bank H Account …89 Wife $159 Bank Statement Bank accounts Husband Unknown Rates paid for benefit of Husband during sole occupation Husband $6,511 Rates Notice – period from 4/2/19 to 30/6/19, 1/7/19 to 30/6/20 and 1/7/20 to date of payment from proceeds Company F Assets Ownership H’s value W’s value Source of Valuation Sale Proceeds Q Street, Town C Joint $24,193.84 $24,193.84 Cosgriff Lawyers Trust Statement Part property Adjustment Husband $20,000 $20,000 Orders Part property Adjustment Wife $20,000 $20,000 Orders Motor Vehicle 2 $8,000 $8,000 Redbook Motorbike $600 $600 Sale Proceeds Mower/Conditioner Equal shares distributed to the parties $17,036.25 $17,036.25 Bank H Account $15 $15 Bank statement TOTAL ASSETS $534,415 $544,505
LIABILITIES Personal Liabilities Ownership H’s value W’s value Source of Valuation Bank D Mortgage Joint $180,404 $178,824 Bank D Statement Motor Vehicle Finance Wife $1,474 $756 Motor Vehicle Finance Statement ATO Liability Wife $792 Company F Liabilities Ownership H’s value W’s value Source of Valuation Possible Taxation/CGT Liability Unknown Unknown TOTAL LIABILITIES $181,878 $180,372
TOAL NET ASSETS $352,537 $364,133
SUPERANNUATION Superannuation Ownership H’s value W’s value Source of Valuation Super Fund R Wife $37,021 $37,021 Super Fund R Super Statement as at 10 February 2021 Super Fund R Husband $60,546.41 Unknown As at 2 September 2020 (updated figure required) TOTAL SUPERANNUATION $181,878 $180,372 CONTRIBUTIONS
It is submitted on behalf of the Wife that whilst there were considerable financial contributions made by the Husband’s parents, the reality is that through 27 years of joint endeavours, there is very little left and what is left does not reflect in any way the considerable moneys expended by the Husband’s family in trying to support this family to successfully run a farming enterprise.
It is submitted on behalf of the Wife that the Court should consider the parties’ contributions over 27 years as equal. During their relationship they endured floods, drought, business downturn, milk prices dropping, severe mental health issues and periods when the Wife was working three jobs – off-farm, on-farm and as the primary homemaker and parent to the children. Theirs was a lengthy journey together, at the end of which there is only a small pool for division between them and therefore this is a case where the myriad of contributions of these parties are so complex that to try and give weight to their various contributions independently would be a false and inappropriate exercise. It is submitted that this is a matter where the entirety of the parties’ contributions over the 27 years of their relationship are such that the only conclusion that the Court should come to is that these parties equally contributed to the best of their ability in various ways.
I am in no doubt that if the Husband had continued to participate in the proceedings, he would have argued that the Court should give considerable weight to his parents’ contributions. This is borne out by his Response filed 25 January 2021 in which he argued that the division should be 80 per cent to him and 20 per cent to the Wife.
Whilst I can understand why this division was put on the Husband’s behalf, I am more persuaded by the arguments put on behalf of the Wife that to give greater weight to one particular contribution over the myriad of all the others over such a lengthy and realistically difficult, and perhaps at least financially unsuccessful relationship does not do justice to the story of these parties’ relationship.
Therefore, I am in agreement with the Wife that this is a matter where the Court should consider the parties’ contributions to be equal.
S75(2) FACTORS
Both parties are in their 40s. They are both engaged in full-time employment. My understanding is that the Husband has re-partnered. I know nothing of the financial circumstances of his now partner. As already noted in this judgment, the parties’ children are independent adults.
I am not persuaded that there needs to be adjustment for s.75(2) factors. Both parties are in a position to move on independently and support themselves going forward.
JUST AND EQUITABLE
Section 79(1) of the Act provides the Court can make such orders altering the parties’ property interests as it considers appropriate for the benefit of parties to the marriage or a child of the marriage.
The interim distribution of the parties’ assets and the assets in their possession are nearly equal. There is only $1,000 difference in what the parties currently hold.
I am therefore left with three matters I am asked to consider.
The first relates to how the Wife should receive her share of the former matrimonial home. The valuation that was obtained at the expense of the Wife, even though the husband was required by orders of this Court to contribute, valued that property at $390,000. The current mortgage in relation to that property is $178,824, leaving equity of $211,176. Fifty per cent of the equity is $105,588.
The Wife is seeking the sale of the former matrimonial home and the proceeds of the sale be divided equally, subject to some adjustments that she says should be made in her favour which will be detailed further below.
In my discussions with the Wife’s Counsel, he indicated that the Wife was not opposed to the Husband being afforded an opportunity to try and retain the property by buying her out as long as there is a limited period in which he can take advantage of that option.
The second issue is whether there should be adjustments made in the Wife’s favour from the Husband’s share of the former matrimonial home.
In relation to the adjustments that the Wife argues should be made in her favour in relation to the equal distribution of the proceeds of sale of the former matrimonial home, she argues that the costs that have been reserved in her favour should be paid from the Husband’s share of the proceeds of sale.
The Wife also seeks she be repaid the sum of $550 in relation to the Husband’s half share of the valuation of that property which the Husband was ordered to pay but did not do so. The Wife paid the Husband’s share of the valuation.
The Wife further argues that rather than the Court making a splitting order in relation to the parties’ superannuation entitlements, it would be more appropriate that such an equalisation be done by way of an adjustment in relation to the realisable assets.
I note that the Husband’s known superannuation as at 2 September 2020 was $60,556 and the Wife’s superannuation as at 10 February 2021 was $37,021. Therefore, on the Wife’s calculations, a splitting order would be approximately $11,000.
The Wife argues that an adjustment in her favour at this point in time of approximately $7,000 of the parties’ realisable assets would be an appropriate adjustment in her favour rather than a splitting order.
Part of the orders that were made by Registrar Mathews in relation to the distribution of the proceeds of sale of the property at Q Street, Town C was a payment of $10,335.42, being arrears of council rates on the former matrimonial home. It is the Wife’s evidence that of that amount, $6,511 related to rates that were not paid by the Husband post-separation when he had the benefit of living in the former matrimonial home.
Because those funds would have otherwise been available to the parties for their fifty-fifty distribution, the Wife argues there should be an adjustment in her favour of 50 per cent of that amount, being $3,255.
The adjustment therefore sought by the Wife is that there be an additional amount of $16,805 paid by the Husband to her in addition to 50% of the equity in the former matrimonial home.
I am more than satisfied that the Wife’s reserved costs of the Conciliation Conference and of 18 August 2021 totalling $7,000 ought to be paid by the Husband. They were unnecessarily incurred by the Wife and are as a direct result of the Husband’s failure to participate in the proceedings when he was clearly put on notice that he should do so.
The Husband was ordered to pay a half-share of the valuation of the former matrimonial home and he failed to do so. The Wife paid for the valuation in its entirety. She should be reimbursed the $550 she paid for the Husband.
I believe the Wife’s proposed approach to the superannuation splitting order in the circumstances of this case is very sensible given the small amount of the parties’ superannuation and her proposed reduction in the sum paid to her in lieu of a splitting order. Accordingly an amount of $7,000 will be allowed in the Wife’s favour.
If the Husband had paid the rates on the former matrimonial home post separation there would have been an additional $6,511 available for division between the parties. It is only appropriate the Wife should be reimbursed by the Husband for her share of lost funds being $3,250.
Accordingly, there should be an adjustment in the Wife’s favour of $16,805.
It is therefore my intention to make orders that the Husband have 30 days in which to pay the Wife the sum of $122,393. If he should fail to do so or opt not to do so, then the former matrimonial home is to be sold and from the net proceeds of sale, 50 per cent plus $16,805 is to be paid to the Wife and 50 per cent less $16,805 is to be paid to the Husband.
Finally, the winding up of Company F must be attended to.
I will make orders that provide for the Wife to do all things necessary to reregister Company F and then appoint herself as the public officer. She is then to do all things necessary to lodge all the requisite documents to enable Company F to be wound up. The Wife, an accountant, has indicated that there are not going to be any taxation liabilities of Company F because the losses carried forward are such that they offset any tax issues that may arise.
The Wife has estimated that the various fees payable to the Australian Securities and Investments Commission to have Company F reregistered and wound up will be somewhere between $3,000 to $5,000. The Husband should be very grateful for the Wife’s expertise in being able to attend to this matter with minimal cost to both of them.
There is currently $24,193.84 in the trust account of the solicitors who conducted the conveyance of the sale of the property at Q Street, Town C. I am going to make orders directing that those funds be distributed as to $5,000 to the Wife’s solicitors to be held in trust to pay any expenses arising from the winding up of Company F and the balance to be divided equally between the parties. In in the event there is anything of the $5,000 left after Company F is wound up, it is to be divided equally between the parties.
I will otherwise make orders for the parties to retain all that is currently in their possession including their superannuation entitlements and orders that the parties indemnify each other in relation to any liabilities relating thereto.
I certify that the preceding seventy-nine (79) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Bender. Associate:
Dated: 14 October 2021
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