Leeds and Leeds

FAMILY COURT OF AUSTRALIA

LEEDS & LEEDS

[2009] FamCA 146

FAMILY LAW – CHILDREN – Parenting dispute about who should do the travelling for the handing over of children – Issue determined on the basis of the wife having another older child to manage and her activities currently looking after both children – Dispute about Christmas Day time where one child wants to spend time with father and the other does not – Teenage children – Arguments about splitting of siblings for part of that day
FAMILY LAW – PROPERTY – Addbacks – Argument about money spent by each party subsequent to separation and whether money should be added back to pool

Family Law Act 1975 (Cth)

C and C [1998] FamCA 143
M and M [1998] FamCA 42
Townsend and Townsend (1995) FLC 92-569

APPLICANT:

MR LEEDS

RESPONDENT:

MS LEEDS

FILE NUMBER:

MLC

3698

2007

DATE DELIVERED:

6 MARCH 2009

PLACE DELIVERED:

MELBOURNE

PLACE HEARD:

MELBOURNE

JUDGMENT OF:

THE HONOURABLE JUSTICE CRONIN

HEARING DATE:

23 & 24 FEBRUARY 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT:

MR PANNIFEX

SOLICITOR FOR THE APPLICANT:

MESSRS INGPEN & BENT

COUNSEL FOR THE RESPONDENT:

MR AMBROSE

SOLICITOR FOR THE RESPONDENT:

SAMANTHA WARD PTY

Orders

That all existing parenting orders are discharged.
That the husband and the wife have equal shared parental responsibility of the child R born … October 1996.
That the child live with the wife.
That the husband spend time with the child R as follows:
(a)   during each alternative weekend from 10.00am Saturday until 7.30pm on the Sunday, the first of such weekends to be deemed to be the next weekend after the date of these orders that the husband would otherwise spend time with R under previous orders;
(b)   for approximately one half of all school term holidays by agreement and in default of agreement, the second half, such time to be determined according to paragraph 5 of these orders;
(c)   for a period of two weeks of the long summer holidays as defined by paragraph 6 of these orders;
(d)   on Father’s Day weekend in each year on the same terms as paragraph 3(a) of these orders in addition to any time to which the husband is entitled pursuant to paragraph 4(a); and
(e)   from 10.00am on 24 December 2010 until 12 noon on 25 December 2010 and for a similar period in each alternate year thereafter.
(a) For the purposes of paragraph 4(b), if the husband is to have the first half, the husband shall collect R from the home of the wife at 10.00am on the day after the last day of the school term and the wife collect R from the home of the husband at 7.30pm on the Sunday in the middle of the school holidays;
(b)If the husband is to have the second half, the husband collect R from the home of the wife at 10.00am on the Sunday in the middle of the school holidays and the wife collect R from the home of the wife at 7.30pm on the Sunday before R resumes school.
For the purposes of paragraph 4(c), unless otherwise agreed, the husband spend time with R for a period of two weeks of each long summer holiday period:
(a) in 2009 and in each alternate year thereafter, for 14 days commencing at 3.00pm on 25 December; and
(b) in 2010 and in each alternate year thereafter for 14 days commencing at 10.00am on 26 December.
That for the purposes of paragraph 6, the husband shall collect R from the home of the wife at the commencement of the period and the wife shall collect R from the home of the husband at the conclusion of the period.
For the purposes of paragraph 3(e), the husband shall collect R from the wife’s home at the commencement of the period and the husband shall return R to either the wife’s home or the child’s maternal grandparents (whichever he is so advised) at the conclusion of that period.
That the husband shall communicate with R by telephone at reasonable times each week.
For the purposes of paragraph 3(a), the husband shall collect R from the home of the wife at the commencement of the period and return him there at the conclusion of the period.
That pursuant to s.65DA(2) and s.62B, the particulars of the obligations these orders create and the particulars of the consequences that may follow if a person contravenes these orders and details of who can assist parties adjust to and comply with an order are set out in the Fact Sheet attached hereto and these particulars are included in these orders.
That the husband and the wife forthwith authorise and direct the solicitors holding the funds in trust on their behalf from the proceeds of the sale of their former home, be disbursed as follows:
(a) to the husband $97,900; and
(b) to the wife $134,100.
The base amount to be allocated to the wife out of the husband’s interest in the C-BUS Superannuation Fund is $32,564 (“the base amount”).
In accordance with s 90MT(1)(a) of the Family Law Act 1975 (Cth) whenever the Trustee makes a splittable payment from the interest held by the husband in C-BUS superannuation fund the Trustee of that fund pay to the wife the amount which is calculated in accordance with Part 6 of the Family Law (Superannuation) Regulations 2001 and there be a corresponding reduction in the entitlement that the husband would have had but for these orders.
That paragraph 13 has effect from the operative time.
That the operative time for the purposes of these orders is the fourth business day after the day on which a sealed copy of these orders is served upon the Trustee.
That each party otherwise retain and the other relinquish any interest in, all other property in the names of the parties as at the date of these orders.
That all applications be otherwise dismissed and all proceedings be removed from the list of cases awaiting a hearing.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC3698 of 2007

MR LEEDS

Applicant

And

MS LEEDS

Respondent

REASONS FOR JUDGMENT

The parenting issues in this case revolve around a child R who was born in October 1996. R is 12 years of age. The proceedings involve both parenting and property matters.
There are five issues in dispute. They are:
(a)what time should be spent between R and his father at Christmas time;
(b)who should do the travelling on alternate weekends so that R can spend time with his father;
(c)what items should be notionally added back to the pool of assets in relation to monies spent by each party;
(d)what, if any, liabilities should be jointly paid from the pool of assets; and
(e)how should the ultimate pool of assets be divided.
The case began about a whole raft of other issues including child support but those matters were resolved.
Because of the discrete nature of the parenting issues, I discharged the Independent Children’s Lawyer with the agreement of both the husband and the wife to save costs. The Independent Children’s Lawyer was first heard however on all parenting issues before being so discharged.
In relation to the property division, the ultimate gap between the parties was modest notwithstanding there were significant factual disputes that I will determine.
The husband is 41 years of age and a tradesman. The wife is 38 years of age and a manager of a government body.
The parties commenced living together in 1988 and married in April 1989. They separated on 11 September 2005.
There are two children of the relationship S who was born in September 1994 and R as I have already mentioned. I have only referred to R earlier because there is sadly no relationship between the husband and S and having regard to S’s strident views, the husband was sensibly not prepared to pursue the issues about parenting with her. I accept however that he has an earnest desire to have a relationship with S and the door is still open.
In respect of R, the husband currently sees him on alternate weekends from Saturday morning to Sunday evening and some holiday time. The husband agreed to continue that leaving the dispute about travel on those alternate weekends to be determined.
The husband lives in suburban Melbourne. The wife lives in suburban Geelong. I accept the husband’s evidence that his trip on each alternate Saturday and Sunday is 220 kilometres and takes him about two hours and 20 minutes there and back on each day. That of course is on the basis that he collects R and returns him to his house in suburban Melbourne.
I have heard evidence that the husband has a fledgling relationship with a woman in the Geelong area. His friend has two very young children and although the wife suggested that the relationship had been going on for six months, I see no reason to reject the husband’s evidence that it has been a relationship of three months. On two occasions now, the husband has stayed overnight with his friend in the company of R but that has not generally been successful. It is more likely than not therefore that R will spend time with his father in the Melbourne environs.
There is another alternative and that is that the husband stays with R on a boat moored in the Geelong environs and that has also occurred on a number of occasions. That however has its limitations and as such, I accept that generally the time between father and son will be in Melbourne.
The husband’s position in relation to the travel was that each of he and the wife should spend equal times travelling so that he collected R at the commencement of the period of time and the wife collected R on the return trip. The wife’s position was that the husband should do the lot. The Independent Children’s Lawyer adopted the position of the wife.
The evidence of the husband was that he had done all of the travelling for the last two years. He said the return time precluded him from giving R an evening meal and doing things that he would like to do. Part of the difficulty with that evidence was that the husband understood that he had to return R by 5.00pm rather than 7.00pm so to some extent, there has been some confusion. Notwithstanding that, the husband said that driving R back in the car was no substitute for the personal relationship that he would like to have. He added that he paid his child support and he felt that it was only fair that there should be a sharing.
The evidence of the wife was that she had had a busy life running both children around during the week. She said on weekends she drove S to her various activities which include rowing and meeting friends. Each fortnight there were also activities for R including attending a paediatrician and psychologist, taking him fishing and playing hockey. The wife stressed the fact that she was working full-time and that meant she had a very busy life. Counsel for the husband cross-examined the wife about the various activities and although many of them do not take significant periods of time, I find that they are consistent and involve the wife in activities outside of her work hours most days of the week.
I am not convinced as a matter of law or policy that issues such as travel should be decided on the basis of a dichotomy of roles of parents. Each parent fulfils responsibilities in their own way. Sometimes it is a fact of life that one parent cannot spend more time than they would like with a child. A sharing of travel could be seen by a child as both parents putting aside their own needs and grievances in a positive way to ensure the ongoing relationship between parent and child was fostered. Some children no doubt would desire their parents to be together in an ideal world and a sharing of travel could be seen by the children as a way of their parents getting on and jointly participating in the children’s lives. The responsibilities of parenthood are arduous and parents each have to put themselves out to make the relationship of parent and child work.
In this case, the unusual feature is that the tyranny of distance is compounded by the wife’s need to provide for 14 year old S whose busy teenage activities cannot be put on hold on a weekend. I reject as a primary principle that I should decide the issue on the basis of the wife’s view that she already does enough and that the husband should bear a fairer portion of the burden. Each case must be decided not only on its particular facts but also on what is best for the child. In this case, I find it is in R’s best interest for his mother to be focussed on S’s needs as well as on his during each alternate weekend. In this case, there are no financial issues that would affect the cost of travel.
However, no useful purpose would be served by R seeing the husband and wife together. No useful purpose would be served by S being brought along where her relationship with the husband is one of antipathy.
Although the husband said that driving with R was not “one on one” time, I propose to extend the time later on the Sunday so that R can have a Sunday evening meal with the husband and then begin the wind-down on the return journey to Geelong. It is a time when the husband and R can not only review what they have achieved over the weekend but also cement their relationship by planning the next period.
It is therefore in the best interests of R that the husband do the travelling for the alternate weekends but that other holiday period travel should be shared.
In 2005, 2006 and 2007, R and S spent time on Christmas Eve and Christmas morning with the wife. In December 2008, I ordered the husband’s time with R to commence at 3.00pm on Christmas Day.
The husband’s evidence was that about Tuesday prior to Christmas Day, R telephoned him wanting to change the ordered arrangement so that he could spend time with his father much earlier than that, including Christmas Eve and Christmas morning. I accept the husband’s evidence that not only was the call made by R but that the husband suggested to R that he should speak to his mother and check that the arrangement was okay. That is particularly important having regard to the fact that on 19 December 2008, negotiations had occurred at the Court and the orders were ultimately made for the time to commence at 3.00pm. Ironically enough, the wife agreed to change the arrangements.
Importantly, the husband said he thought it imperative for R to be back with the wife’s parents for the traditional Christmas lunch on Christmas Day and as such, he travelled down to Geelong to deliver R to the wife.
The wife was reluctant to give the husband any credit for any of these steps and said that R had been “bribed”. It was not something that she led in evidence in chief nor was that put to the husband in cross-examination. Whatever may have been the cause of past unhappiness between the husband and the wife, including the wife’s evidence about “beatings” and abuse leading her to have psychological difficulties, the evidence of the husband indicated that he was child-focussed. His rationale for getting R every year to the grandparents’ lunch on Christmas Day was evidence of that.
The wife’s evidence was that the husband’s proposal was not the pattern of the past and that it was not appropriate for R to be separated from S. The wife said that S was unhappy about being separated last Christmas. Having said that, she said that if R ever wanted to see the husband, she would go along with his wishes. Christmas Day in 2008 was a good example of where that happened. The wife said she had done and promoted a post-separation parenting program and she understood all of these things. However, the wife’s evidence had a superficial sound about it. For whatever criticisms there may have been of the husband’s parenting in the past, I could not fault his approach on this occasion.
In my view, the important feature in this particular case is that the child will attend the Christmas Day lunch. That was a time recognised by the husband as important. S and R will be together on that particular occasion along with the wife.
I find it is in the best interests of R to spend time before lunch on Christmas Day with the husband in one year and from after lunch on Christmas Day in the alternate year.
As I canvassed with the parties, all of these judgments are very subjective. Having said that, s 60CA says that when I am making a particular parenting order, I must regard the best interests of the child as the paramount consideration. That is the reason why I have looked at each of the two issues from the perspective of R rather than from the approach of the parents.
Section 60B sets out the objects of Part VII of the Family Law Act 1975 (Cth) (“the Act”) and the principles underlying it. In simple terms, the objects are to ensure that the best interests of the children are met by ensuring that they have the benefit of both parents having a meaningful involvement in their lives and at the same time, protecting the children from all of the various facets of harm. The objects require the Court to consider meeting the best interests of the children by ensuring the children receive adequate and proper parenting to enable them to achieve their full potential and wherever possible, to ensure that parents fulfil their duties and meet their responsibilities concerning the care, welfare and development of the children.
Section 60B(2) sets out the underlying principles to those objects. The focus of those principles is the rights of the child as well as the responsibilities of the parents. One significant principle is that parents should agree about the future parenting of their children. Sadly, the relationship between the husband and the wife in this case is such that they do not, at least at this stage, communicate at all well. The husband gave evidence that R had commented about the dialogue that had occurred between husband and wife in his presence which pleased him. I accept that there is a long way to go for these parties but the message should be clear from their own son.
In determining what is in the best interests of a child, s 60CC sets out a number of factors. Each of those factors must be considered when determining what is in the best interests of a child.
The two important primary considerations are the benefit to the child of having a meaningful relationship with both parents and the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence.
I find that although it is early days, the time that the husband spends with R enables him to have a meaningful relationship with his father. Having heard the evidence of the wife about the activities in which she is involved, I was impressed that she also has a meaningful relationship with R. It is clear that the wife is engaged on a daily basis whilst still working full-time, in getting R to not only the important developmental activities but at the same time the relaxing ones such as fishing and hockey.
I am satisfied that both parents are conscious of the fact that they need to avoid confrontation and conflict because of its dramatic impact on R.
Although the wife gave evidence about past activities, I am not satisfied that there is any current problem between the husband and the wife that would fit within the definition of physical or psychological harm for R.
I make no findings in relation to the child S in so far as these matters are concerned because I am not required to make any orders of a parenting nature.
Section 60CC(3) sets out a number of additional considerations. The first of those is any views expressed by the child. The evidence of the husband more so than the wife, makes it clear that R wants to have a close relationship with his father and spend more time with him. I have factored that issue into the determinations referred to above.
I have already indicated that the relationship between R and his parents is close. I do not know much about the relationship between R and S but I have presumed that it is a normal sibling relationship. The wife also gave evidence and I see no reason to reject it that the child enjoys going out to see his maternal grandparents. The husband seems to support that.

Section 60CC(3)(c) requires me to consider the willingness and ability of each of the child’s parents to facilitate, and encourage, a close and continuing relationship between R and the other parent. There was no evidence put to me to suggest that the husband has adopted a position in which he is negative about the relationship between the wife and R. Quite the opposite, I am satisfied that the incident at Christmas showed that the husband is conscious of the need for R to have respect for and consider the views of his mother when making a determination about wanting to spend time with his father. That is a positive attribute of the husband. I have some reservations which I have expressed above about the wife’s attitude of the same type although the wife certainly articulates that it is her desire for R to have what he wants rather than her actually encouraging the relationship to take place.
I have taken into account that R is not distressed by being away from his mother or S nor is there any practical difficulty involved in R spending the time with his father. I reject the suggestion that the travelling is a restriction that works as an impediment to any meaningful relationship between the husband and R.
I am satisfied that each of the parents has a capacity to provide for R’s needs including his emotional and intellectual needs.
I have already made reference to the attitude by both parties to the responsibilities of parenthood and will not repeat them.
Whilst there is evidence of family violence asserted, that evidence was not dealt with in any particular way and as I have the impression that the husband at least wishes to leave the past behind him, it would serve no useful purpose in this particular case to go over that material.
In my view, this is a case where it would be preferable to make final orders to stop the parties having to continually argue before the courts.
Section 60CC(4) requires me to consider the extent to which each parent has fulfilled or failed to fulfil the responsibilities of parenthood. Each parent said that the other could have equal shared parental responsibility but it would appear that at the moment, there is little dialogue between the parties. I have great hopes that that may change to enable them to not only participate in the lives of R and hopefully in the future S in the case of the husband, but also that they can talk about issues involving schooling, health and social development. That is not really happening at the moment and it should be.
Some criticism was made of the husband’s absence from the life of R but I am satisfied that in more recent times, the husband has diligently pursued his relationship with R and has left the door open for S.
As I have already indicated, it seems to me that when I factor all of those matters into the equation, it is in the best interests of R that I make the orders to which I have referred.

Property

The financial dispute revolved around two issues. The first was whether and if so what, should be added back to the pool as a result of money spent by the wife. The second was whether and if so what, money should be allowed to the husband for liabilities that remain unpaid.
The husband sought orders that of the cash currently held by his solicitors from the net proceeds of the sale of the former matrimonial home, he should be paid $100,000 and the balance to the wife. In addition, he would retain the yacht worth $10,000.
Counsel for the husband submitted in final address that subject to determining the pool of assets, I should assess the contributions as to 60 per cent to the husband and 40 per cent to the wife. He said that I could then be justified in giving the wife 60 per cent and the husband 40 per cent having regard to the matters set out in s 75(2) of the Act.
The wife sought that of the $232,000 in the trust account, she should receive $172,000 and the balance namely $60,000 be paid to the husband.
In his final address, Mr Ambrose of counsel on behalf of the wife said that I should assess the contributions both pre- and post-separation as being equal and there should be a 15 per cent adjustment in favour of the wife for the matters set out in s 75(2) of the Act. In other words, there should be a division as to 65 per cent to the wife and 35 per cent to the husband.
It was common ground between the parties that there is superannuation in a variety of funds totalling $122,116. The husband has $93,622 in that total and the wife $28,494. It was agreed between the parties that I should divide the total equally between them and then make an appropriate splitting order. I was advised by both parties that the C-Bus Superannuation Fund trustee had been provided with notice of the proposed splitting order and had indicated a willingness to implement it. On the basis of that agreement, I propose to make the necessary order.
In respect of the property matters, the wife relied upon her affidavit and evidence given orally and the husband relied upon his affidavit and the evidence given orally along with two of his acquaintances in relation to money lent to him. Each party relied upon a financial statement.
Although each party made a number of assertions about the other, none of the matters really affects the ultimate outcome. This case was not conducted on the basis of the party’s respective credit but rather, the evidence, vague as it was, as each party decided to present it.
The parties pursued some of the contentious issues and accordingly although they may not necessarily affect the outcome of these proceedings, I shall make findings about them. Where I do so, the determination is based on the balance of probabilities.
I cannot however ignore the fact that each party required the other to face cross-examination and counsel pursued the two main issues essentially because of the vagueness of the other party’s evidence on those controversial issues. The wife’s evidence in chief about what she did with the joint savings was simply set out in, inter alia, a bland statement that the money went on living expenses, the clean up and repair to the former matrimonial home and her legal fees. The dilemma that the husband faced was that he maintained that the wife was not justified in spending the money the way she did. Through his lawyers, the husband sought details and source documents of how the money was spent. Those requests were met with a deafening silence. In cross-examination, the wife’s response was that she left it to her lawyers. When I listed this matter in January 2009, a time at which the deafening silence was continuing, no issue was raised with me about such lack of responsiveness. This Court cannot continue to allow that to occur. It is to avoid those problems that I list cases for mention to ensure readiness. Had I been made aware at that time of the state of discovery, I may very well not have listed it for trial. In the event that either party ultimately decides to seek costs out of my orders, that may very well be a significant factor in my determination.
By way of financial background, the parties purchased the land upon which the matrimonial home was built in 1989. Neither party had any assets of substance at the start of the relationship. The funds to build the home were borrowed from the State Bank.
Throughout the parties’ relationship, the husband was predominantly the financial provider and the wife the homemaker and parent. Neither party took issue with the respective contributions of the other.
In February 2002, the parties took out a line of credit with the Commonwealth Bank secured against the home. From funds drawn against that loan, a motor car and a yacht were purchased. When I deal with the pool of assets below, the yacht will appear but the car will not. It was common ground between the parties that their respective motor vehicles should be excluded from the division. The same will be said in respect of furniture and chattels however I do intend to take into account the items that the wife has purchased subsequent to separation.
In 2004, the parties purchased an investment property in Melbourne. The whole of the purchase price together with the necessary setting up costs was borrowed from the Commonwealth Bank on an interest only basis for five years.
One of the problems that has created difficulty for the parties in these proceedings and which arose at the time of separation was that there was a shortfall in the money received from the rental of the investment property and the obligation to service that loan together with all of the ancillary expenses associated with a negatively geared property fell predominantly to the husband. Those ancillary expenses included rates, insurance, agents’ fees and body corporate charges.
Whilst the parties were struggling with the negative gearing, they were also able to amass savings in a Colonial First State account which was in the name of the wife. The balance in that account was $32,263.45 as at 30 June 2005. Money was contributed to that account by direct debit from a joint account with Commonwealth Bank. In very confusing evidence, notwithstanding the balance was as I have just referred to as at 30 June 2005, it climbed with interest to $39,974 at the end of September 2005. By the end of December 2005, it had risen to $44,440. It was clearly a good investment. In addition to the Colonial First State account, the parties also had some shares which were subsequently sold.
There as a significant dispute between the parties about what happened immediately after separation in respect of the home. The wife said that she left because of the husband’s violence. She said she took with her her clothes and her handbag. In her affidavit, she referred to the fact that she took nothing. The husband was cross-examined about this issue and said that over time, the wife took things and he helped her move items of furniture into her rented accommodation. When that was put to the wife in cross-examination she emphatically denied that the husband ever assisted her at all. The wife gave evidence about the fact that she acquired white goods, furniture and other household requisites including the washing machine and dryer using the Colonial First State money or drawing against the mortgage facility. There was no evidence given by the wife about what happened to all of the furnishings of the home.
The wife said that having left the home in such an urgent state, the husband changed the locks. The husband denied that that occurred. The husband said that he left the house in January. The wife said that thereafter she was denied access to the property. Both parties said that money had to be spent on the home and each claimed that they had spent various sums. The wife complained bitterly that she had to undertake the tasks because the house was in an appalling state. In her affidavit of evidence, she referred to the fact that she spent $4000 on repairs but conceded in cross-examination that in her calculations, she had factored in the time she spent and that of her parents. There is no evidence that I could make a finding that the wife was denied access to the property by the husband. Curiously, she had to break a window to get into the property. There was no corroborative evidence that the husband had changed the locks nor that the wife had to break the window because she did not have a key. The whole period is shrouded in mystery. On the balance of probabilities, I accept the husband’s evidence about what occurred immediately after separation.
At the end of 2006, the home sold and after the various debts were discharged, an amount of $239,831 was paid into a trust account on behalf of the parties. Each party subsequently took $20,000 and despite that reduction, the balance is now back up to $232,000.
The controversial issue is what happened between the time that the parties physically separated and the ultimate settlement of the sale.
The husband’s evidence was that all of the money he received including from his salary, his taxation refund, the rental money from the investment property and the sale of shares all went into his bank account. Those documents relating to his banking must have been examined by the practitioners for the wife as that evidence was not seriously challenged. From the husband’s bank account, he said that he paid not only the mortgage commitment but all of the associated costs relating to the investment property together with the various expenses associated with getting the property ready for sale. The husband corroborated much of this expenditure by pointing to his taxation returns. He added that during the period immediately after he left his employment, he was out of work for a number of weeks and then returned to a part-time arrangement. Notwithstanding that, he was using all of the funds available over which he had control to pay the shortfall for the investment loan as well as his own living expenses and child support.
Counsel for the wife and indeed the wife in cross-examination herself asserted that the shortfall for the husband was $400 per month. When the wife was really tested about that issue however she conceded she was not in a position to support that assertion with any specific calculations of her own. There is little doubt in my mind looking at the taxation returns of the husband that the shortfall between 2005 and 2007 is approximately $49,000. There is clearly a distinction between the notional figures claimed for tax purposes and the actual expenditure. The documents presented by the husband do not mean that he is entitled to claim a contribution greater than the wife just because he used all of his available resources to support what is the current asset in the pool. That is one aspect of contribution which I shall turn to below. Similarly, it does not mean that the husband is justified in claiming an allowance for all of the monies borrowed by him from private sources. What I am satisfied about is that the husband struggled to live within his means.
The husband’s evidence was that there was not enough money available to him to cover all of the expenses and his living requirements. He said that periodically he borrowed from two friends. Mr E and Mr M both gave evidence. Mr E’s affidavit originally said that he had lent the husband $5000 and was still owed that sum but when he gave evidence, he conceded that he was actually only owed about $3500. Mr M said that he was owed $8000 although he had lent about $10,000.
Counsel for the wife cross-examined both of these men who indicated that they had lent the husband on numerous occasions varying sums of money and in the case of Mr M, petrol was paid for to enable the husband to run his car. Counsel for the wife all but conceded that there was no reason why I should doubt the veracity of these two witnesses. I will be the first to concede that their evidence was vague but both were emphatic about the fact that they had lent the money and that it was owed. Some of the money had been repaid to them but it was a small amount. Mr M impressed me as a person who really felt that what he was doing for his “mate” was providing a gift on the basis that although he knew he would get the money back, he certainly had no ambitions of it being returned at any particular time.
I find that there is no question that the husband borrowed the money and that it is expected to be repaid at a time such as now when the husband will have access to that money.
I find that the husband owes Messrs E and M a total of $11,500. The wife gave evidence to the effect that the husband and she had been making all of these house and investment payments prior to separation asking me to infer that there was no reason for the husband to have to borrow any money. She pointed to the fact that the husband had continued his lifestyle. I have taken into account however that where the parties were both living in rented accommodation subsequent to separation, the financial dynamic changes significantly. Having accepted the evidence of Mr M that he provided the husband with money for petrol and not being aware of any other evidence put by the wife that the husband was living an extravagant lifestyle, I have no reason to doubt that what the husband said was true about being unable to make ends meet.
Accordingly, the question that must be determined is whether or not the whole of that liability should be a joint liability or simply something for which the husband should be solely responsible.
At the start of the proceedings, I required the parties to provide me with a letter setting out what costs they had incurred and paid with their lawyers. I am satisfied that prior to paying his lawyers out of funds that might be said to have been joint moneys, the husband paid approximately $5950 and on the basis that the husband had insufficient funds to make ends meet as I have found above, it is a fair inference to suggest that the money borrowed from Messrs E and M went indirectly into the hands of the husband’s lawyers. For reasons that I will come to, I propose to add-back the wife’s legal fees drawn from joint funds of the parties and on that basis, the husband must face the same prospect. I propose therefore to treat the husband’s liability to Messrs E and M which I have fixed at $11,500 by allowing as a joint liability, all but $5950 being the money for which the husband alone should be responsible because otherwise the wife would be contributing towards his legal cost. The appropriate liability for which both parties should therefore bear responsibility is $5550. I propose that that sum be treated as a liability in the pool.
The second contentious issue relates to what happened to the Colonial First State account money. I have set out above the fact that it was a substantial sum of money and it has now gone. The wife’s evidence was that between January 2006 and December 2006, she withdrew all of those funds to pay expenses “as and when required”. She said she applied these funds:
(a)on expenses to re-establish herself and the children following separation;
(b)to clean up, carry out repairs on and prepare for sale the former matrimonial home (with the approximate amount being $4000);
(c)on living expenses for herself and the children; and
(d)the payment of $17,000 to her former solicitors.
Counsel for the husband in cross-examining the wife pointed to the fact that she had been ordered to produce documents to show what happened to that money and requests had also been made for details. I am satisfied that no proper explanation has ever been given as to what happened to all of that money. As I have indicated above, the wife has conceded that she paid $17,000 to her former solicitors to obtain her file as she made clear she was dissatisfied with the services that they were providing. It was common ground between the parties that $17,000 should be added back to the pool.
Dealing then with the other three issues, I find that the evidence is less than satisfactory on the wife’s part. The wife certainly conceded that she spent money for a washing machine and dryer and various other household furnishings. Those payments came from her account or one of the five accounts that she had which in turn had been topped up by monies drawn from the Colonial First State account. It is impossible for a court to expect someone such as the wife to provide every docket for supermarkets, clothing stores over a period such as one or two years well after the event. Commonsense dictates that children have ongoing needs. That was particularly so in this case having regard to the fact that S was commencing high school and R had particular needs. However, as counsel for the husband demonstrated, during the period of the year of 2006, the wife was receiving income from her employment, child support and various Commonwealth pension entitlements. I have no evidence to indicate what daily expenses were being incurred and nothing to suggest that the wife was living extravagantly. What is important is that the wife’s account for a significant part of 2006 carried a balance of about $7000 or so. I have concluded from that that the wife was obviously able to live within her means. On her own evidence, she said she liked to have money in case it was needed; money in this case which was joint funds.

The husband’s evidence was that on 19 January 2006, the wife withdrew $10,000 from the Colonial First State account. On 20 March 2006 she withdrew $6000 from the account. On 10 April 2006, the withdrew $3000 from the Colonial First State account. On 10 May 2006, the wife withdrew $8000 from the Colonial First State account. Between 19 January 2006 and 16 May 2006, the wife withdrew $27,000 out of that account. In her financial statement, the wife conceded that she had $5000 worth of household contents. Bearing in mind her assertion that she took nothing with her but acquired all of those items from the funds of the parties, I think it is only fair for that amount of money at least to be added back into the pool of assets. The wife certainly has the benefit of the ongoing use of the furniture. That is not to say that the children don’t benefit as well but that amount of money is significant for living expenses if the wife was otherwise receiving the sorts of funds which I have already mentioned.
Counsel for the husband also pointed to the fact that towards the end of 2008, the wife had savings of $1500 whereas there had been a much higher sum earlier in 2008. The wife explained the difference by saying that she had paid for a holiday to the United States of America to be taken in September 2009 with the children.
The wife has also indicated that she spent approximately $4000 in the cleanup and carrying out of repairs for the home but as I have already indicated, without some more precise evidence having regard to the fact that she took into account her labour and that of her parents, I would not be prepared to accept that that was a reasonable sum to be so expended.
Adding back property in any pool of assets is always a difficult exercise. In Townsend and Townsend (1995) FLC 92-569, the Full Court was dealing with a case in which a party had disposed of a taxi licence and then spent the proceeds. Nicholson CJ with whom Fogarty and Jordan JJ agreed said that it would be unjust to simply treat what the husband did as something that should be taken into account under s 75(2). Their Honours pointed to the fact that the party in that case had had the benefit of the money. The only correct and just way in those circumstances was to add it back to the pool on a notional basis and then make the distribution.
As with Townsend’s case, the money in the Colonial First State account was jointly acquired funds. They were funds in which the husband had a legitimate interest on the basis that he had made a direct contribution during the marriage.
The Full Court in M and M [1998] FamCA 42 warned that if funds subsequent to separation were spent on “reasonably incurred necessary living expenses”, there was no appropriate basis to add them back. In this case, I have the dilemma of knowing that the wife certainly spent some money on furniture and white goods and they were necessary if I accept that even on the basis of the husband’s evidence, the wife needed some items but I have no real evidence as to what money was spent on her own needs and the needs of the children. I am satisfied that the expenditure of the wife was not unreasonable or extravagant. There is certainly unexplained cash withdrawals but it was conceded by the husband that the wife was neither a gambler nor drinker such as would explain those withdrawals. I can only presume that they have gone on a particular lifestyle.
In C and C [1998] FamCA 143, the Full Court said:
Whilst not seeking to place a fetter upon the exercise of discretion of a trial judge in individual cases, it seems to us that the concept of adding monies reasonably disposed of back into the pool ought to be the exception rather than the rule. The parties are entitled to reasonably conduct their affairs post-separation in a manner that is consistent with properly getting on with their lives…
With the paucity of evidence in this case as to what the money was spent on and particularly having regard to the number of opportunities that the wife had to produce documents during the period to which I have earlier referred as the deafening silence, I am not sure that I can make a finding that the funds were simply reasonably disposed of. I accept however that the wife has the benefit of the furniture and will have newer furniture than the husband had if he retained some from the home. In M and M (supra) also, the Full Court made the observation that property should be dealt with as at the date of the hearing except in exceptional circumstances. Adjustments should be made taking into account the matters set out in s 79. I am therefore dealing with money that is no longer in the hands of the wife but it is conceded by her that she has $5000 worth of furniture and a pre-paid holiday to the United States for herself and the children.
Ultimately as the authorities have indicated, I must endeavour to achieve a just and equitable outcome. For the wife to simply push aside the fact that all of that investment money has disappeared save for the $17,000 prepaid legal fees, would be doing an injustice to the husband on the basis that he has not shared in the fruits of the parties’ efforts during the marriage. Those funds were not post-separation earnings and they were spent without his consultation. They were spent also at a time when as I have found, the husband was spending all of the funds he had on maintaining the assets otherwise in the pool.
Just what sum should go back into the pool is clearly a discretionary matter. I propose to add-back the legal fees of $17,000 and a further $12,500. The $12,500 is made up of $7500 being the balance of funds which appears to be the consistent savings in the period subsequent to separation and a further $5000 which is reflected in the items that the wife has purchased.
I find therefore that the pool is as follows:
Cash  $232,000
Yacht  10,000
Add-backs
Wife’s legals  17,000
Wife’s Colonial Funds  12,500
Wife’s advance from trust                20,000
Husband’s advance from trust          20,000          69,500
Total  $311,500
Less liabilities of the husband as allowed  5,500
Net  $306,000
It was conceded by Mr Ambrose that all of the other liabilities set out in the parties’ documents associated with loans and credit cards were substantially incurred if not entirely incurred, after separation. They really have nothing to do with the other party and on that basis, I propose to ignore them for the purposes of the division in the pool.
I have also kept as a separate pool, the superannuation entitlements to which I earlier referred but as the parties have reached agreement as to what is to happen to that sum, I will not refer to it again.
I turn then to the assessment of the contributions of the parties. Mr Ambrose on behalf of the wife indicated to me that I should find that there should be an assessment as to 50 per cent to each party. Mr Pannifex on behalf of the husband disagreed with that by pointing to all of the post-separation contributions of a financial nature by the husband. In isolating that post-separation period, Mr Pannifex was effectively conceding that up until separation, the parties’ contributions had been equal. The dilemma I am faced with here is that it is dangerous to isolate one particular portion of a contribution such as that. Whilst the husband was clearly struggling to make ends meet as I have earlier mentioned, the wife was caring for the children on a significantly different basis to that which had occurred prior to separation when the parties were largely a functional family. It was common ground between the parties that for several months, the husband had no contact with the children. Even when he did have time with the children, it was on a limited basis and in more recent times, only with R. I cannot distinguish between the efforts made by the husband post-separation and those of a non-financial nature made by the wife. When I take those matters into account, there is no basis for me to distinguish between the parties’ contributions generally. Accordingly, I find that the parties have contributed equally.
I turn to the factors set out in s 75(2) of the Act. Mr Ambrose on behalf of the wife said that I should make a contribution allowance in the wife’s favour of 15 per cent. He pointed to the fact that the wife had a significant responsibility in respect of the children and that that was the major distinguishing feature between the parties.
The husband is 41 years of age and the wife 38. Each of them therefore has a significant number of years of earning capacity ahead of them. The husband has qualifications and has been engaged in a trade for a number of years. The wife is in a managerial position. Neither party put before me any evidence as to any health disorders that would create difficulties for their continuing employment. The wife is currently earning $80,000 per year which is supplemented by child support of $242 per week from the husband. The husband’s income is slightly less than that sum. He earns about $65,000 per year from which he provides support for the children. There is little distinction therefore between the parties’ incomes even though the wife is in the stronger position. However I take into account that the wife has the obligations to support the children which on any view are greater than those of the husband even taking into account child support payments made.
Each party is renting property and neither party suggested that there were any peculiar features of their commitments that required to have allowances made for them.
I take into account that the wife has a significant responsibility ahead of her in relation to not only two teenage children but the particular responsibilities in relation to R. I think I have clearly set those out when I earlier dealt with the parenting issue but I accept that the wife has to expend money including on professionals for the benefit of R.
Neither party has the responsibility to support any other person.
The wife is receiving a very limited amount of taxpayer funded Commonwealth benefits.
Each party is living a standard of living probably less that that which they enjoyed together but that is a fact of life that these orders cannot ameliorate.
This is a long marriage and I am satisfied that with the wife’s commendable efforts to get herself back into the workforce, she obviously has the necessary skills and ability to support herself into the future.
In saying that however, the wife is adamant about the role she wishes to fulfil in protecting in particular R who has health difficulties.
I am satisfied that neither party is cohabiting with any other person.
I am satisfied that the husband is paying appropriate child support and having regard to his record, I see no reason why that would change in the future.
One of the fundamental problems in a case such as this is that despite the longevity of the relationship, the parties have very little ultimately to divide between them. By the time each takes out their share of a small pool and then pays their current obligated legal fees, there will be little left for them. However, neither party indicated a particular desire to buy a home or what their details were about borrowing capacity for that purpose. I have presumed therefore that each party will have the same aspirations.
Weighing all of those factors together, there is little doubt that the wife’s responsibility for the children even with her better income has a justifiable need for an adjustment in her favour and I assess that at 10 per cent.
Accordingly, I find that the pool of assets should be divided as to 60 per cent to the wife and 40 per cent to the husband. Having made those assessments, it is important to step back and determine that the division is fair or just and equitable. It is not the percentages that must be just and equitable but the underlying value of those percentages. In addition, I must be satisfied that the gap between what each party receives is justifiably fair. In this case, I am satisfied that there is a justification for the 20 per cent gap between the parties’ respective final positions. I am also satisfied in the circumstances that this is a just and equitable outcome for both parties.
On the basis of the pool taking into account the add-backs and the liabilities leaving a net sum of $306,000, the wife will receive an entitlement of $183,600 and the husband $122,400. From the wife’s share, the sum of $49,500 has to be deducted for her prepaid legal expenses, the money she has received as I have found and the $20,000 that was an advance that both parties received. That leaves her with a cash entitlement of $134,100.
Of the husband’s $122,400, he retains the yacht at $10,000 and a cash advance of $20,000 as did the wife. His entitlement therefore is $92,400. However, what also needs to be added to the husband’s share is the $5500 that must be repaid as part of the liability that he owes to Messrs E and M. As those liabilities are only in his name, there is no basis for me to make any orders that the husband indemnify the wife. I will simply order that the funds in the trust account therefore be divided as to $134,100 to the wife and $97,900 to the husband.

I certify that the preceding One Hundred and Eight (108) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin

Associate:

Date: 6 March 2009

[2009] FamCA 146

6 March 2009

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