Leppin and Delorenzo
[2019] FCCA 345
•21 February 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| LEPPIN & DELORENZO | [2019] FCCA 345 |
| Catchwords: FAMILY LAW – Property settlement – final hearing – where parties have been married for 19 years – whether alleged debt owing by husband to his father to pay private school fees is a matrimonial liability – where the husband received a child support assessment adjustment for having paid these school fees – issue of other alleged loans from the parties’ parents – where the wife seeks the husband purchase her interest in the former matrimonial home or otherwise sold – where the husband seeks the former matrimonial home to be sold – order for sale of the former matrimonial home, unless otherwise agreed. |
| Legislation: Family Law Act 1975, ss.79, 80, 81 |
| Cases cited: Bevan & Bevan (No.2) [2014] FamCAFC 19; (2014) FLC 93-572 |
| Applicant: | MS LEPPIN |
| Respondent: | MR DELORENZO |
| File Number: | SYC 1913 of 2016 |
| Judgment of: | Judge Monahan |
| Hearing date: | 1 March 2018 |
| Date of Last Submission: | 2 March 2018 |
| Delivered at: | Sydney |
| Delivered on: | 21 February 2019 |
REPRESENTATION
| Solicitors for the Applicant: | Mr Reeve of Marsdens Law Group |
| Counsel for the Respondent: | Mr Stapleton |
| Solicitors for the Respondent: | Blackman Legal Pty Ltd |
ORDERS
THE COURT ORDERS ON A FINAL BASIS THAT:
Unless otherwise agreed in writing, within 56 days of these Orders both parties take all necessary steps and execute all necessary documents to cause the property situated at and known as Property A, NSW (The "Former Matrimonial Home”) to be sold by private treaty at the earliest possible date, and that the proceeds be disbursed as follows:
(a)Payment of agent’s commission, advertising expenses and legal expenses of the sale;
(b)Payment of the usual rate adjustments;
(c)The net balance to be divided between the parties as follows:
(i)58% to the Applicant Wife;
(ii)the sum of $16,934 to the Applicant Wife; and
(iii)the balance to the Respondent Husband.
For the purposes of the sale referred to in paragraph 1 above, the following applies:
(a)That the Applicant appoint a Real Estate Agent (“the Agent”).
(b)The parties execute all documents requested by the Agent for the sale of the property.
(c)That the Respondent appoint the Conveyancer to prepare the contract for sale.
(d)The sale price be mutually agreed by the parties but failing agreement, for not less than the market value as determined by a registered valuer agreed upon by the parties but failing such agreement by a registered valuer nominated by the president for the time being of the New South Wales Division of the Australian Property Institute.
(e)The parties shall execute the contract for sale and all other documents necessary to complete the sale of the property including all transfer documentation forthwith upon its submission.
Unless otherwise agreed in writing, the Applicant continue to pay as they fall due all regular instalments in respect of the council and water rates in respect of the Former Matrimonial Home and pay forthwith any arrears in respect of the said instalments, until the sale of the Former Matrimonial Home.
The parties retain all their right title and interest in and to their superannuation entitlements and have no further claim on such entitlements of the other.
Subject to these Orders, the parties have the sole right, title and interest in any other property, including choses-in-action, which is at the date hereof in their possession, title, or name and they shall be solely liable for and indemnify the other against any personal liabilities.
In the event that either party refuses or neglects to execute any deed or instrument, the Registrar of the court be appointed pursuant to section 106A of the Family Law Act 1975, to execute such deed or instrument in the name of such party and to do all acts and things necessary to give validity to the operation to the deed or instrument.
In the event that any party seeks to press their application for costs in these proceedings, they are to make, file and serve an Application in a Case within 28 days of the date of these Orders.
Subject to paragraph 7 herein, all extant applications be otherwise dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Leppin & Delorenzo is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYC 1913 of 2016
| MS LEPPIN |
Applicant
And
| MR DELORENZO |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an application by MS LEPPIN (“the wife”) against MR DELORENZO (“the husband”) who is seeking property orders pursuant to section 79 of the Family Law Act 1975 (“the Act”).
The parties are in dispute as to their respective property and family contributions made during their relationship and following their separation. They are also in conflict about their respective future needs.
At the final hearing both parties were legally represented, the wife was represented by her solicitor, Mr Reeve and the husband was represented by counsel, Mr Stapleton.
Unless otherwise stated, any statutory references in these reasons will be to the Family Law Act 1975 (“the Act”).
Background
Relationship history
The wife was born on …1965 and is currently aged 53 years of age. The husband was born on …1963 and is currently aged 54 years of age.
The parties were married on …1989 and commenced cohabitation following marriage.
The parties have three children of the marriage, two of which are adults, MR D born on …1993 currently aged 25 years of age (“Mr D”) and MS E born …1995 aged 23 years of age (“Ms E”). The third child, [X] born …2002, is currently aged 16 years of age (“[X]”).
The parties separated on a final basis on 21 October 2008. Despite their long separation the parties are not yet divorced.
Following separation, the husband has moved out of the former matrimonial home and is currently residing with his new partner. The wife continues to reside in the former matrimonial home with Ms E and [X]. Mr D currently resides with the paternal grandparents.
Procedural history
The wife filed her Initiating Application on 1 April 2016 (later amended on 22 February 2017). The husband filed his Response on 31 May 2016.
The matter first came before Judge Jarrett on 3 June 2016 and the matter was adjourned to 11 October 2016 before me to enable the parties to attend mediation via the Family Law Settlement Service.
The parties attended mediation on 6 October 2016 and were not successful in resolving their dispute.
On 11 October 2016 the matter was adjourned to a callover for the allocation of final hearing dates.
This callover was fixed to 18 September 2017 and the matter was allocated a final hearing for two days commencing 1 March 2018.
As stated, the final hearing proceeded on 1 March 2018 and on 2 March 2018, the Court reserved its decision.
Chronology
Both parties provided the Court with a brief chronology listing significant events in the parties’ relationship. The parties were not in dispute in relation to the following:
| Date | Event |
| 1985 | The husband purchased Property B, for $103,000. |
| 1987 | The parties commenced a relationship. |
| 1988 | The parties purchased Property C, for $125,000, registered in both names. |
| …1989 | The parties are married and commenced cohabitation in the Property C property. |
| 1991 | The parties commenced cohabitation in the Property B property and the Property C is tenanted. |
| …1993 | Mr D was born, currently 25 years of age and living with his paternal grandparents at their home at Suburb F. |
| … 1995 | Ms E was born, currently 23 years of age and a university student, still living with the wife at the former matrimonial home. |
| 1997 | The Property B House was sold for $317,000, unencumbered at the time. |
| 1997 | The parties purchased Property D (“the former matrimonial home”) from the husband’s parents for a purchase price of $430,000, $130,000 of which was gifted by the husband’s parents and the balance made up from the sale proceeds of the Property B House. |
| …2002 | [X] was born, currently 16 years of age and living with the wife in the former matrimonial home. |
| October 2008 | The parties separate on a final basis when the husband moves out of the former matrimonial home and is presently living with his partner in her home in Property G. |
| November 2010 | The parties sell the Property C Unit for a sale price of $376,500 of which $276,135 was used to discharge the mortgage and the Wife received about $80,000 which is applied towards the payment of school fees for the children and living expenses of the wife and the children. |
Legislative requirements
Property proceedings between parties to a marriage are governed by the provisions of Part VIII of the Act, and more specifically, s.79.
Section 79
Section 79(1) of the Act states that the Court may make such orders as it considers appropriate altering the interests of the parties in the property.
Section 79(2) of the Act provides that:
“The court shall 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.”
If the Court is satisfied that it is just and equitable to make an order altering the interests of the parties in the property, s.79(4) of the Act sets out those matters which the Court must take into account when considering what orders should be made. Section 79(4) provides:
In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(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.
Section 79(4)(e) requires the Court to have regard to the matters set out in s.75(2) of the Act being the matters relevant to spousal maintenance. Section 75(2) of the Act states the matters to be taken into account are:
(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.
Approach to exercise of discretion
The approach to the exercise of the Court’s discretion has been outlined in numerous judicial decisions. The High Court in the decision of Stanford v Stanford [2012] HCA 52 (“Stanford”) held that before making any orders adjusting the parties’ interests in the property pursuant to s.79 of the Act, the Court must, as required by s.79(2) of the Act, determine that it is “just and equitable” for the Court to do so. At [42] the High Court stated that in most cases:
“The just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).”
Prior to the decision in Stanford, the preferred approach in determining property matters was that set out by the Full Court of the Family Court of Australia (“Full Court”) in the matter of Hickey v Hickey [2003] FamCA 395; (2003) 30 Fam LR 355; (2003) FLC 93-143. At [39] Nicholson CJ, Ellis and O’Ryan JJ stated:
“The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of s 79. That approach involves four inter-related steps. Firstly, the court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing. Secondly, the court should identify and assess the contributions of the parties within the meaning of ss 79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Thirdly, the court should identify and assess the relevant matters referred to in s 79(4)(d), (e), (f) and (g), (“the other factors”) including, because of s 79(4)(e), the matters referred to in s 75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two. Fourthly, the court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case…”
This approach was reconsidered by the Full Court in Bevan v Bevan [2013] FamCAFC 116; (2013) FLC 93-545 (“Bevan”) in light of the High Court’s comments in Stanford. At [71], Bryant CJ and Thackray J stated:
“Stanford will also serve as a reminder that the four step process “merely illuminates the path to the ultimate result”. Any future restatement of that process should incorporate acceptance of the fact that the power to make any order adjusting property interests is conditioned upon the court finding that it is just and equitable to make an order.”
In Bevan & Bevan (No.2) [2014] FamCAFC 19; (2014) FLC 93-572 the Full Court, having upheld the appeal against the decision at first instance, proceeded to re-determine the property application before the Court. At [18] to [19], Bryant CJ and Thackray J stated:
“18. Senior counsel for the husband structured his submissions by reference to the “four-step” approach to property settlement applications discussed in our earlier reasons. By way of explanation for doing so, senior counsel said:
16. The adoption of the above [four-step] approach is not intended to presuppose a positive answer to the question posed [by] section 79(2), nor to suggest that it is an approach appropriate in all proceedings. Rather, and provided that the fundamental propositions outlined by the High Court in Stanford (2012) … are not obscured, such approach is intended to and does no more than provide a principled, disciplined and structured means by which all of the matters arising for consideration pursuant to section 79 can be conveniently and properly identified and assessed.
17. Further, and whilst not said critically nor in a matter which seeks to cavil with the decision in this appeal, no other approach to the determination emerges readily from either Stanford nor the decision in this appeal. It is respectfully submitted that provided that the ‘fundamental propositions’ articulated in Stanford are not obscured, and whilst not universally so as has always been recognised, the approach set out above continues to provide a proper, transparent, certain and structured approach to the presentation and determination of applications pursuant to section 79.
19. We have no issue with what senior counsel has said about the utility of the four-step process, which we accept provides a convenient way to structure both submissions and judgments, provided the caveat mentioned is not overlooked.”
The ‘caveat’ referred to by the Full Court is the requirement that the Court must first be satisfied that it is just and equitable to make an order adjusting property between the parties.
In the subsequent decision in Rockman & Rockman [2014] FCCA 1966 (“Rockman”), Judge Bender noted at [83] that the “High Court in Stanford “neither disapproved or approved the four steps process”. I agree with her Honour’s observation. That said, the High Court did lay down what they described as three “fundamental propositions” which would provide useful guidance to trial judges when undertaking the task under s.79 of the Act. I note that in Bevan,[1] Bryant CJ and Thackray J summarised those fundamental principles at [73] as follows:
“… 1.Determination of a just and equitable outcome of an application for property settlement begins with the identification of existing property interests (as determined by common law and equity);
2.The discretion conferred by the statute must be exercised in accordance with legal principles and must not proceed on an assumption that the parties’ interests in the property are or should be different from those determined by common law and equity;
3.A determination that a party has a right to a division of property fixed by reference only to the matters of s 79(4), and without separate consideration of s 79(2), would erroneously conflate what are distinct statutory requirements.”
[1] Bevan v Bevan [2013] FamCAFC 116; (2013) FLC 93-545.
I also agree with the view expressed in Rockman that subsequent Full Court and single judge considerations of Stanford suggest that the path that may best “illuminate the path to the ultimate result” could now best be described as the following ‘five step process’:
“(a)firstly, what is the parties’ legal and equitable interests in property;
(b)secondly, is it just and equitable to make an order adjusting the parties legal and equitable interests in that property;
If the answer to (b) is in the affirmative:
(c)thirdly, identify and assess the contributions of the parties within the meaning of ss.79(4)(a), (b) and (c) of the Act and determine the contribution-based entitlements of each party as a percentage of the net value of the property of the parties;
(d)fourthly, identify and assess the relevant matters referred to in ss.79(4)(d), (e), (f) and (g) and s.75(2) of the Act and determine the adjustment, if any, that should be made to the contribution-based entitlements of each party as a percentage of the property of the parties; and
(e)fifthly, given s.79(1) empowers the court to make such orders affecting the parties’ interest in the property as are appropriate, determine what order, if any, altering the parties’ interests are “appropriate” to enable the parties’ entitlements as determined pursuant to steps (c) and (d) to be achieved.”[2]
[2] Rockman & Rockman [2014] FCCA 1966 at paragraph 84.
The Court will adopt this process for this decision.
Section 80
In addition to the specific powers provided by s.79(1) to adjust property interests, s.80(1) provides the Court with the following general powers:
The court, in exercising its powers under this Part, may do any or all of the following:
(a) order payment of a lump sum, whether in one amount or by instalments;
(b) order payment of a weekly, monthly, yearly or other periodic sum;
(ba) order that a specified transfer or settlement of property be made by way of maintenance for a party to a marriage;
(c) order that payment of any sum ordered to be paid be wholly or partly secured in such manner as the court directs;
(d) order that any necessary deed or instrument be executed and that such documents of title be produced or such other things be done as are necessary to enable an order to be carried out effectively or to provide security for the due performance of an order;
(e) appoint or remove trustees;
(f) order that payments be made direct to a party to the marriage, to a trustee to be appointed or into court or to a public authority for the benefit of a party to the marriage;
(h) make a permanent order, an order pending the disposal of proceedings or an order for a fixed term or for a life or during joint lives or until further order;
(i) impose terms and conditions;
(j) make an order by consent;
(k) make any other order (whether or not of the same nature as those mentioned in the preceding paragraphs of this section), which it thinks it is necessary to make to do justice; and
(l) subject to this Act and the applicable Rules of Court, make an order under this Part at any time before or after the making of a decree under another Part.
Section 81
For completeness, I note that the Court must also consider s.81 of the Act which states:
“In proceedings under this part [i.e. Pt VIII], other than proceedings under section 78 or proceedings with respect to maintenance payable during the subsistence of a marriage the court shall, as far as practicable, make such orders as will finally determine the financial relationships between the parties to the marriage and avoid further proceedings between them.”
While s.81 of the Act is clearly relevant to the making of a property order, it is neither a ‘head of power’ nor an absolute requirement. This was the view of the Full Court in In the Marriage of Crapp and Crapp (No 2) (1979) 5 Fam LR 47; (1979) FLC 90-615:
“Firstly sec 81 is in the nature of an exhortation by the legislature to the courts and is not a separate source of power and secondly the section itself states that the policy of making orders which finally determine the financial relationship between the parties and avoid further proceedings is only to be taken ‘as far as (is) practicable’. Nevertheless it is true to say that it is unsatisfactory in the general context of the philosophy of the Family Law Act for a really significant issue between parties who are divorced and have gone their separate ways to remain in suspended animation for a number of years.”[3]
[3] In the Marriage of Crapp and Crapp (No 2) (1979) 5 Fam LR 47 at 61 (per Fogarty J; Pawley and Dovey JJ agreeing).
The practical effect of s.81 of the Act is that the Court must endeavour to make an order that finalises the financial relationship between the relevant spouses, but it does not require the Court to make an order that achieves finality. That said, for the comments previously made, and as far as it can be achieved, I see clear benefit in orders being made that will finalise the financial relationship between the parties.
Proposals
Wife
The wife argues that, based on her view as to what comprises matrimonial property, she should be entitled to a final adjustment in her favour of 65% to 70%. She argues that both parties equally contributed overall within the meaning of the Act and that she should be entitled to a further adjustment in her favour of 15% for her s.75(2) and related factors. Based on her view of the balance sheet, the wife proposes that the husband purchase her interest in the former matrimonial home and in return he pay her the sum of $1,622,900.00 with the parties to otherwise keep their other property (including superannuation) and debts. The wife seeks no orders for costs.
The precise orders sought by the wife were as follows:
1. These Orders are made by way of alteration of property interests pursuant to Section 79 of the Family Law Act 1975.
2. That within 42 days from these Orders, the Applicant Wife does all acts and things necessary, including signing all documents necessary to transfer right title and interests in the property situated at and known as Property D, (The "Property D Property") to the Respondent Husband.
3. That simultaneous to the above, the Respondent Husband pay to the Applicant Wife a sum of $1,622,900.00 by way of property alteration.
4. That the Respondent Husband does all acts and things necessary, including signing all documents necessary to indemnify Applicant Wife and the Applicant Wife indemnified in relation to all expenses and liabilities relation to the Property D property whether or not those expenses and liabilities were incurred before or after the date of these Orders.
5. In the event that the payment referred to in Order 3 has not been received by the Applicant Wife within 42 days of the date of these Orders, then the parties forthwith do all acts and things and sign all documents necessary to cause the Property D property to be sold for such price as is mutually agreed by the parties but failing agreement for not less than market value as determined by a registered valuer agreed upon by the partiers but failing such agreement by a registered valuer nominated by the president for the time being of the New South Wales Division of the Australian property institute and the net proceeds of sale are to be distributed as follows:
5.1 In payment of all selling expenses including estate agent's commission, auctioneer's fees, legal expenses on sale, valuer's fees (if any);
5.1 In payment of the usual rate adjustments including any arrears of rates;
5.3 In payment to the Applicant Wife of the sum of $1,622,900.00 and any interest calculated under the Family Law Rules from the date the payment in Order 3 hereof should have been made until the date of settlement;
5.4 The balance to the Respondent Husband.
6. That as between the Husband and Wife, and subject to the above Orders, the Husband and Wife shall each respectively retain all interest in and entitlement to:
6.1 All personal property now in his/her respective possession or control.
6.2 All shares, debentures, units in unit trusts, bank, building society or credit union accounts standing in his/her sole name respectively
6.3 All interests in life insurance policies and superannuation funds standing in his/her sole name respectively.
7. That the Applicant Wife shall be solely liable for all other debts standing in her sole name and shall indemnify the Respondent Husband in respect of the same.
8. That the Respondent Husband shall be solely liable for all other debts standing in her sole name and shall indemnify the Applicant Wife in respect of the same.
9. Both the Applicant Wife and Respondent Husband hereby release the other from all actions, proceedings, claims, demands, costs and expenses whatsoever and howsoever arising which either of them had or may have against the other for or by reason of or in respect of any act, cause, matter or thing.
10. That in the event that either party refuses or neglects to execute any deed, document or instrument necessary to give effect to these Orders, the Registrar of the Court be appointed pursuant to Section 106A of the Family Law Act to execute such deed, document or instrument in the name of the said party and do all acts and things necessary to give validity and operation to the deed, document or instrument upon the Registrar being provided with verification of such refusal or failure by way of affidavit.
Husband
The husband argues that, based on his view as to what comprises matrimonial property, he should be entitled to a final adjustment in his favour of 55%. He argues that, while both parties made contributions within the meaning of the Act, his contributions to the property pool exceed that of the wife. The husband also argues that neither party should receive any further adjustment for s.75(2) and related factors. Based on his view of the balance sheet, the husband proposes that the former matrimonial home be sold and the net proceeds of sale be divided 55% to him and 45% to the wife. The parties would otherwise keep their other property (including superannuation) and debts. In addition, the husband seeks an order that the wife pay his legal costs.
The precise orders sought by the husband were as follows:
1. That within 42 days of these orders both parties take all necessary steps and execute all necessary documents to cause the Property G property to be sold by private treaty at the earliest possible date at the best price offered and that the proceeds of the said sale be disbursed as follows:
a. Payment of agent’s commission, advertising expenses and legal expenses of the sale;
b. The net balance to be divided between the parties as follows:
i. 45% to the Applicant; and
ii. 55% to the Respondent.
2. That for the purposes of the sale referred to in Order 1 above, the following shall apply:
a. That the Applicant appoint a Real Estate Agent (the Agent).
b. The parties shall execute all documents requested by the Agent for the sale of the property.
c. That the Respondent shall appoint the Conveyancer to prepare the contract for sale.
d. Upon agreement being reached for the sale of the property the parties shall execute the contract for sale and all other documents necessary to complete the sale of the property including all transfer documentation forthwith upon its submission.
3. That until the sale of the property, the Applicant continue to pay as they fall due all regular instalments in respect of the council and water rates in respect of the property and pay forthwith any arrears in respect of the said instalments.
4. That the parties retain all their right title and interest in and to their superannuation entitlements and have no further claim on such entitlements of the other.
5. That other than as otherwise set out in this agreement the parties have the sole right title and interest in any other property which is at the date hereof in their possession title or name and they shall be solely liable for and indemnify the other against any personal liabilities.
6. That the Respondent and Applicant do all acts and things and give all consents and execute all documents and writings necessary to give effect to the orders made herein.
7. That in the event that either party refuses or neglects to execute any deed or instrument, the registrar of the court be appointed pursuant to section 106A of the Family Law Act 1975, to execute such deed or instrument in the name of such party and to do all acts and things necessary to give validity to the operation to the deed or instrument.
8. That unless otherwise specified in these orders and except for the purposes of enforcing the payment of any money under these or any subsequent orders:
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 the date of these orders;
a. Any money standing to the credit of the parties in a bank account are to be retained by the party in whose name the account appears;
b. Each party hereby foregoes any claim they may have to any superannuation benefit that is belonging to or owned by the other save as provided for in these orders;
c. All insurance policies are to become the sole property of the owner named hereon;
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 husband and wife in any real or personal estate is hereby expressly severed.
9. That the Applicant pay the Respondent’s costs in this matter
Issues
The following specific issues were raised during the course of the final hearing and require determination by the Court:
·What contributions each party made to the acquisition, conservation or improvement of the matrimonial property pool, and to their family, and the strength of those contributions;
·Whether there should be a further adjustment in the wife and/or the husband’s favour for ‘s.75(2) and related factors’; and
In addition, the parties are in dispute as to whether certain monies received by the husband from his father post-separation are a ‘loan’, and if so, whether this loan represents a relevant matrimonial liability.
Evidence of the parties
Both parties provided the Court with affidavit and oral evidence and were cross-examined. No other person, apart from the husband’s father Mr F, was required for cross-examination.
A number of documents were tendered by each party in support of their case which have been considered as part of this decision, details of which are provided below.
Wife
The following documents were relied upon by the wife:
·Amended Initiating Application filed on 22 February 2017;
·Financial Statement filed on 22 December 2017;
·Affidavit of Dr G (the wife’s psychiatrist) sworn on 19 July 2017 and filed on 26 July 2017;
·Her Affidavit sworn on 22 December 2017 and filed on 25 January 2018; and
·Her Affidavit sworn and filed on 14 February 2018.
The wife also tendered the following documents:
·Superannuation Statements from years ending 30 June 2006, 2011 and 2012 (Exhibit “1”);
·Term Deposit Certificates dated 8 November 2012 tabbed on pages 1, 2 and 3 (Exhibit “2”);
·Bundle of documents relevant to the …Investment; (Exhibit “3”); and
·Viridian Line of Credit statement dated 1 to 30 January 2009 (Exhibit “4”);
·The wife’s 2009 tax return documents (Exhibit “5”); and
·Tender bundle of documents (Exhibit “6”).
The wife was a well-spoken and articulate witness. She presented to the Court as candid and generally believable.
Husband
The husband relied upon the following documents at the final hearing:
·Response filed on 31 May 2016;
·Financial Statement filed on 2 February 2018;
·His Affidavit affirmed and filed on 31 May 2016;
·His Affidavit affirmed and filed on 27 June 2016;
·His Affidavit affirmed on 2 February 2017 and filed on 5 February 2017;
·Affidavit of Mr F affirmed and filed on 27 June 2016; and
·Affidavit of Mr F affirmed and filed on 2 February 2018.
The husband did not tender any documents.
The husband was also well spoken and articulate witness. He was generally candid and was able to agree to some reasonable propositions even it that impacted upon his own case.
The paternal grandfather, Mr F, was well spoken for someone who had some hearing difficulties and where English was not his first language. He gave evidence that left no doubt in the Court’s mind that he clearly left the running of his post retirement business affairs to the husband. The paternal grandfather clearly trusts the husband in dealing with his monies (and other property).
Discussion and Findings
The Court will now consider the parties’ proposals and submissions in light of the legislative requirements and the available evidence.
Identifying and valuing the parties’ property and interests
As stated, the Court must firstly ascertain what the parties’ property is. This requires identification and valuation of the parties’ property, liabilities and financial resources. Generally speaking, identification and valuation is at the date of the final hearing.[4] This will enable the Court to ascertain the net property pool.
[4] Warne & Warne (1982) 8 Fam LR 388 at 389 (per Simpson J; Strauss and Hase JJ agreeing); also see Omancini & Omancini (2005) 33 Fam LR 134 at 142 (per Holden, Warnick and Le Poer Trench JJ).
Joint balance sheet
The parties filed a joint balance sheet prior to the commencement of the final hearing. By the conclusion of the hearing, the following assets and liabilities were identified and, unless stated, were the subject of agreement as to values:[5]
[5] In the table, ‘W’ refers to property registered in the wife’s name or otherwise legally owned by her or in her possession and ‘H’ refers to property registered in the husband’s name or otherwise legally owned by him or in his possession.
No.
Assets
Valuation
1
Property at Property D (J)
$2,500,000
2
Motor Vehicle (W)
$25,000
3
Motorcycle (H)
$3,000
4
Household Contents (W)
$5,000
5
Household Contents (H)
$5,000
6
Jewellery (W)
$3,000
7
CBA Account (H)
$388
8
Bank Account (W)
$1,740
Sub-total
$2,543,128
‘Addbacks/Partial Property Settlement’
9 Nil 10 Nil Sub-total
Nil
Liabilities
11
Various credit cards (W)
$7,224
12
Various credit cards (H)
$4,406
13
Loan from Parents (H)
Not Known (W)
$76,200 (H)14
Loan from Parents (W)
$11,000 (W)
Not known (H)15
ATO Debt (W)
$3,126 (W)
Not known (H)Sub-total $25,756(W)
$87,830 (H)Superannuation
16
Super fund 1(H)
$62,574
17
Super fund 2 (W)
$27,202
Sub-total
$88,574.00[6]
Total net assets[7]
$2,605,946 (W)[8]
$2,543,872 (H)[9]
[6] The total for ‘Superannuation’ should read $89,776.
[7] Including Addbacks/ Partial Property Settlement and Superannuation.
[8] The total amount according to the Wife should read $2,607,148.
[9] The total amount according to the Husband should read $2,545,074.
Areas in dispute in the balance sheet
To determine the property pool, the following questions require determination:
·Firstly, whether the loan asserted by the husband (ie. $76,200.00[10] owing to his father) is a matrimonial liability or not; and
·Secondly, whether the loan asserted by the wife (ie. $11,000 owing to her mother) is a matrimonial liability or not; and
·Thirdly, whether the taxation debt asserted by the wife (ie. $3,126.00 owing to the Australian Taxation Office) is a matrimonial liability or not.
[10] For further comment see paragraph 55 of these reasons.
Each of those questions will now be considered.
Monies allegedly owing to husband’s father
This relates to an alleged accumulated debt of $76,200 owing by the husband to his father as a result of alleged loan to pay [X]’s school fees.
Under cross examination, the husband acknowledged there was no loan document or any record to this alleged loan of $76,200.[11] The husband also asserted that he had received a further personal loan to his father but was unable to provide further details relating to the loan despite the documents being formally called.[12] The husband was only able to point to credit transfers into his bank account from his father’s account, where if the amount was a “round figure”, he would consider it as moneys being borrowed from his father, as opposed to “precise” or “odd” amounts, being reimbursements for relevant expenses.[13]
[11] Transcript, 1 March 2018, p 51.
[12] Transcript, 1 March 2018, p 51-52, 129.
[13] Transcript, 2 March 2018, p 105-6.
Under cross examination the wife acknowledged that the parties were not able to afford the school fees.[14]
[14] Transcript, 1 March 2018, p 40.
The husband, through his counsel, makes the following submission:
“…that the applicant yesterday accepted in the witness box, that between the two of them they couldn’t afford the school fees. So they could not afford to send their son [X] to Private School so they borrowed the money. She didn’t say, “Well, we only couldn’t afford it because he was doing something else with our money,” or, “He should have been doing this instead.” She didn’t say any of that. She just accepted very easily that $76,000 of school fees, $15,000 a year, could not be paid from their own income.”[15]
[15] Transcript, 2 March 2018, p 134.
In relation to the loan, the husband, through his counsel, makes the following submission:
“So he has borrowed the money from his parents. His father said that that is money which has to be – all the money between the family has to be evenly spread between the three children. He has to be fair. It has to be even. There is absolutely no concept of it being a gift. There is an absolute expectation that it be repaid and that is what I respectfully submit will happen. Your Honour doesn’t need to find that there needed to be some formal written loan deed for that to be a plausible arrangement between the members of the family.”[16]
[16] Transcript, 2 March 2018, p 141.
The wife, through her legal representatives submits that the debt, if any, should not be considered a matrimonial liability as it would be considered “double counting.” The following submission was made:
“… He has paid her the least that he could get away with, and that is the $113, reduced that down to $80.60 a month because, ‘I will claim against that the private school fees, which are adding to the debt which I asked to be taken out of the pool.’ He didn’t agree that there was an unfairness in that, or in my words, a ‘double counting,’ but in my view it’s obvious that there is.”[17]
[17] Transcript, 2 March 2018, p 130.
It appears, therefore, that the evidence supports the argument that there is a debt owing by the husband to his father. Consequently, the issue for the Court to determine is whether this debt should be considered as a matrimonial liability or relevant to the position of the husband’s financial resources.
Having considered the available evidence the Court finds against including this debt as a matrimonial liability. I note the amount initially sought by the husband to be considered in the balance sheet has already been taken into account in his child support liability. The husband has the benefit of a reduced child support assessment due to meeting high paying school fees. It would not be appropriate to consider that the monies borrowed for this purpose be a matrimonial liability. It would be relevant, however, to his available financial resources.
Monies allegedly owing to wife’s mother
This amount relates to item 14 of the joint balance sheet.
It appears that the wife benefitted from the receipt of $11,000 (or property worth $11,000) from her parents on two separate occasions.
Firstly, it appears that he wife benefitted from the receipt of a motor vehicle, that was sold for $11,000. The wife ultimately conceded that this item was a gift to her from her parents.[18]
[18] Transcript, 1 March 2018, p 39.
Secondly, the wife asserts that she received the sum of $11,000 from her parents to enable her to replace the decking at the Property G property in 2016.[19] The wife further asserts that these monies were borrowed from her parents and that they have not been repaid. The wife was not cross-examined about this particular alleged loan and the husband doesn’t appear to respond to this this assertion in his Affidavit affirmed 2 February 2018 and filed 5 February 2018.[20]
[19] Wife’s affidavit sworn 22 December 2017, filed 25 January 2018, paragraph 61, referring to annexure “FF”.
[20] See paragraphs 117 and 118, reference is made to paragraph 59 and 62 of the wife’s affidavit and not to 60 or 61.
I note that neither party made any specific submissions in relation to this alleged debt.
In light of the available evidence, the Court is unable to find that the $11,000 allegedly owed by the wife to her parents is a matrimonial liability. That said, the contribution of the $11,000 to the maintenance and improvement of the former matrimonial home, and the $11,000 received from the sale of the vehicle, are arguably relevant contributions.
Monies allegedly owing to ATO
This relates to an alleged debt of $3,126.00 owing by the wife to the Australian Taxation Office. The wife asserts this debt came about by an “overpayment […] as a result of [her] income having gone up. The balance is tax payable on the rental income I receive [from the granny flat on the Property G property].”[21]
[21] Wife’s Affidavit sworn 22 December 2017, filed 25 January 2018, paragraph [43].
Again, the husband appears to be silent on this issue.[22] It also appears the parties were not cross-examined on this aspect and no submissions were received.
[22] See Husband’s Affidavit affirmed 2 February 2018 and filed 5 February 2018, paragraph [109]-[110], where there is no reference to paragraph 43 of the Wife’s affidavit.
Having considered the available evidence the Court finds in favour of including this debt as a matrimonial liability.
Finding
The Court is only persuaded to include the ATO debt of $3,126.00 owing by the wife as a matrimonial liability. The Court finds accordingly.
Balance sheet findings
Given the above determinations, the Court finds that the net available property pool is $2,618,148, being net non-superannuation assets totalling $2,543,128 and superannuation entitlements totalling $89,776. This sum is made up as follows:
No.
Assets
Valuation
1
Property at Property D
$2,500,000
2
Motor Vehicle (W)
$25,000
3
Motorcycle (H)
$3,000
4
Household Contents (W)
$5,000
5
Household Contents (H)
$5,000
6
Jewellery (W)
$3,000
7
CBA Account (H)
$388
8
Bank Account (W)
$1,740
Sub-total
$2,543,128
Liabilities
9
Various credit cards (W)
$7,224
10
Various credit cards (H)
$4,406
11
Alleged debt not established
Nil
12
Alleged debt not established
Nil
13
ATO Debt (W)
$3,126
Sub-total $14,756 Superannuation
28
Super Fund 1 (H)
$62,574
29
Super Fund 2 (W)
$27,202
Sub-total
$89,776[23]
Total net assets
$2,618,148
[23] As stated previously, the total for ‘Superannuation’ on the joint balance sheet should have read $89,776 and as opposed to $88,574.
Is it just and equitable to make any order?
Both the husband and the wife are before the Court seeking orders altering their property interests.
The Court is satisfied that this is a matter where it is just and equitable that orders be made adjusting property between the parties.
Contributions
As stated, the Court is required to consider the wife and the husbands’ contributions made on and from the commencement of their relationship,[24] during their relationship and following separation.[25]
[24] In the Marriage of Olliver (1978) 4 Fam LR 360; (1978) FLC 90-499.
[25] In the Marriage of Ferraro (1992)16 Fam LR 1; (1993) FLC 92-335.
Global or asset-by-asset assessment of contributions
Given the long relationship, and the reality that the most significant asset is the unencumbered former matrimonial home, the Court has determined that it is appropriate to consider the contributions of the parties on a ‘global’ basis, rather than an ‘asset-by-asset approach’. I note that during submissions, neither party sought to suggest that the Court adopt an ‘asset-by-asset approach’.
In the High Court decision of Norbis & Norbis (1986) 161 CLR 513; (1986) 10 Fam LR 819; [1986] FLC 91-712, Mason, Deane, Dawson, Brennan and Dawson JJ, held that the adoption of the asset by asset approach by a judge was a discretionary matter and that both the global approach and the asset by asset approaches were legitimate and that the circumstances of the approach dictate which is more convenient. The importance is that justice and equity are served by either approach.
As stated earlier, the wife argues that the parties’ respective contributions equalised over time and that each party should be assessed at 50% in relation to s.79 contributions. The husband contends that he should receive an adjustment of up to 55% in his favour for s.79 contributions.
Financial and non-financial contributions
Both the wife and husband assert to making significant financial and non-financial contributions to the property of the relationship.
The wife argues that both parties’ financial and non-financial contributions during the marriage were equal. Although the wife argues that, post-separation, her contribution has been greater considering the “very little assistance from a parenting point of view from the husband, who has not routinely spent time with any of the children; and she has not received any formal child support…”[26] Alternatively, the wife is prepared to concede that the overall contributions between the parties may be equal.[27]
[26] The Wife’s case outline, page 3 paragraph [2].
[27] The Wife’s case outline, page 3 paragraph [4]; Transcript, 2 March 2018, page 128.
The husband argues that he has made greater financial contributions throughout the marriage than the wife. In summary, the husband argues that he provided greater financial contributions by having purchased the Property B House before the marriage and by having met the deficit in the cash-flow while it was tenanted. He also argues that he contributed more financially to the purchase of Property C Unit. In addition the husband asserts that during the marriage he made greater contributions to:
·the parties’ living expenses;
·the renovations to the Property C Unit;
·the mortgage payments to Property B; and
·the payment of living costs post-separation.[28]
[28] The Husband’s case outline, paragraph [15].
The wife appears to concede two specific contributions made by the husband, firstly, the contribution by the husband’s parents by way of gifting $130,000 towards the purchase price of the former matrimonial home in March 1997[29] and secondly, the contributions to the relevant renovations.[30]
[29] Transcript of 1 March 2018, page 37.
[30] Transcript of 1 March 2018, page 4.
However, the wife disputes that the husband should receive credit for making greater contributions to the parties’ living expenses, post-separation. The wife, through her legal representative, makes the following submission:
“…what I would say in response to that is the fact that he paid isn’t the whole answer because it’s where you pay from. And if you’re paying from, you know, partly income, partly advances from your parents and partly capital which has been realised in order to meet the deficit, then it’s just – it’s not quite there because she’s paying too. She’s paying by that co-contribution of capital towards meeting those expenses which I think is a minor but, nevertheless, relevant point.”[31]
[31] Transcript, 2 March 2018, p 143.
Family contributions (as homemaker and parent)
As stated, the wife asserts that the contributions made the parties during the marriage were equal and that her contributions post-separation were equal, if not greater, than the husbands.
The husband accepts that the parties’ non-financial contributions during the relationship were approximately equal including their homemaker contributions. The husband asserts that post-separation, his contribution to the welfare of the family is equal to the contributions of the wife.
Contributions findings
Given the available evidence, the Court is satisfied and finds that the contributions of the parties should be assessed 53% in the husband’s favour. In other words, I find that that the parties’ respective contributions, in percentage terms, should be assessed 47% to the wife and 53% to the husband.
Section 75(2) (and related) factors
As stated, the Court must have also regard to the relevant factors under s.79(4)(d) to (g) of the Act in light of the evidence. These factors are considered further below.
I note again that the wife argues that there should be a further adjustment in her favour of up to 15% for s.75(2) (and related) factors, including her:
·lesser earning capacity when compared to that of the husband;
·non-significant superannuation;
·ongoing care of [X]; and
·receiving no significant child support payments.[32]
[32] The Wife’s case outline, pages 3-4.
The husband argues that there should be no adjustment in either party’s favour for s.75(2) (and related) factors on the basis of the parties’ similar age and health, both parties work, the husband having more superannuation than the wife and the assertion that the wife has more earning capacity than the husband. Overall, the husband asserts that the future needs of both parties are equal.[33]
Section 79(4)(d): effect of any proposed order upon the earning capacity of either party to the marriage
[33] The Husband’s case outline, paragraph [16].
I am satisfied that none of the proposed orders the Court will make will affect either party’s earning capacity.
Section 79(4)(e): matters referred to in sub-section 75(2) so far as they are relevant
(a) The age and state of health of each of the husband and the wife
The parties are aged in their early to mid-50s. The husband and the wife appear to be in reasonable health although the wife asserts that she has suffered from long term depression and anxiety and that this has impacted upon her capacity to work full-time.
I note that the wife induces evidence from her treating psychiatrist, Dr G. As stated, Dr G was not required for cross-examination. Dr G gives evidence that the wife has been a patient since January 2012. Dr G reports that there was a significant improvement, and then a deterioration, in the wife’s mood between January 2013 to June 2013. The deterioration was related to the wife’s thyroid being underactive at that time. Dr G states that while the wife’s mood subsequently improved, there have been patches of deterioration, particularly when accompanied with physical illnesses such as migraine headaches.
Under the heading “the treatment Ms Leppin has received”, Dr G states:
Ms Leppin’s treatment includes both medication and psychological treatments.
a) Quetiapine and lithium were added to the Desvenlafaxine as mood augmentation to achieve complete recovery and improves stability.
b) Planning her days with emphasis on exercise and maintaining social supports was instituted. The need to be more self-nurturing was highlighted.
Under the heading “the prognosis for her illness”, Dr G states:
Ms Leppin has shown a good recovery. She will need to maintain her vigilance to monitor her mood and be assertive in managing any deterioration in mood or sleep. She has shown that she can be very motivated with doing this. This is to her credit.
Under the heading “the costs involved”, Dr G states:
The costs include:
a) Appointments required with her local doctor and me. While she needs to be on lithium to maintain a stable mood she needs to be reviewed every 3 months at a minimum.
b) Costs for medications.
c) Cost for pathology to monitor the blood lithium level as well as monitoring her renal and thyroid functioning.
Under the heading “the impact of Ms Leppin’s illness on her capacity to work”, Dr G states:
Ms Leppin’s personality is someone who pushes herself to do the right thing. She has been diligent to care for her children through all her illnesses. Since I have known her she has also pushed herself to work. This is often at a cost her physically when she sometimes can do too much. Limiting her work to part-time hours would be important to minimise the risks.
When severely depressed Ms Leppin would be unable to work as it would intervere with her concentration & motivation.
(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
Each party alleges that the other is not working to their full capacity.
The wife works on a permanent part-time basis in Employment. She also works on a casual part-time basis at the Employer. She gives evidence that her total average weekly income before tax is $1,238 per week and that her expenses total $359 per week. A significant portion of her income is derived from rent received (being $500 per week) from the lease of a “granny flat” attached to the former matrimonial home. During cross-examination the wife stated that the irregular income she receives from the Employer was not included in her pre-tax income and may total as much as $160 a month (but is usually less).[34]
[34] Transcript, 1 March 2018, page 45.
The husband, who has previously worked as a professional for his father’s business, asserts in his Financial Statement filed 2 February 2018 that he is “unemployed” and only earns a modest income of $113 per week. That said, he also asserts in his Financial Statement that his employer is an entity called “Employer”. Under cross-examination the husband admitted that “Employer” is a corporate entity owned and controlled by his partner, Ms H.[35] The evidence was not clear as to what income, if any, the husband was being paid for being “employed” by “Employer”. What was clear, however, is that modest income disclosed in the Financial Statement may have been the commission or income of approximately $400 a month that the husband receives for managing a commercial property owned by the paternal grandfather and his business partner. I note that the husband also asserts that his expenses total $440 per week. The husband does not disclose what expenses he shares with Ms H.
[35] Transcript, 2 March, 2018, page 94.
What is clear from the evidence, however, is that the husband appears to be able to meet his expenses from the income he earns from managing the relevant commercial property in addition to regular monies he receives from his father. Although the husband does not describe himself as an employee of his father, it is clear from the evidence that much of the husband’s time is taken up by his management of his father’s financial affairs. The husband also appears to have access to a motor vehicle registered to the entity owned by the husband’s father and his business partner.
(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
As stated, the wife has the primary care of [X] who recently turned 16 years of age and is a high school student.
(d)Commitments of each of the parties that are necessary to enable the parties to support:
(i)himself or herself;
(ii)a child or another person that the party has a duty to maintain
The wife has not re-partnered. As stated, the wife continues to reside in the former matrimonial home with the children Ms E, 23 years, and [X], 16 years. The eldest child Mr D, 25 years, currently resides with the paternal grandparents.
In his Financial Statement, the husband admits that he has a “casual girlfriend”, Ms H, but makes no reference to him having re-partnered with her. Under cross-examination, the husband admitted that he “started living” with Ms H “approximately two years ago”.[36]
[36] Transcript, 2 March 2018, page 94.
(e)The responsibilities of either party to support any other person
I refer to previous comments.
(f)The eligibility of either party for a pension, allowance or benefits…
The wife receives benefits from Centrelink; she is in receipt of a Newstart Allowance ($60 per week) and Family Tax Benefit ($176 per week).
Notwithstanding the husband describing himself as ‘unemployed”, his Financial Statement filed 19 July 2017 does not disclose the receipt of any Commonwealth benefits.
(g)Where the parties have separated or the marriage has been dissolved, a standard of living that in all the circumstances is reasonable
While these are property proceedings and not spousal maintenance proceedings, I am satisfied that the Orders to be made in this matter will provide a reasonable standard of living for the parties having regard to their assets and liabilities and the circumstances existing at the present time.
(h)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
This subsection is not relevant to these proceedings as neither party is seeking spousal maintenance.
(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
I am satisfied that on the evidence presented, there are sufficient assets to satisfy the claims of all known creditors.
(j)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
This subsection is not relevant to these proceedings as neither party is seeking spousal maintenance.
(k)Duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration
The wife and the husband married in early 1989. The three children were born between 1995 and 2002. The parties cohabited for almost 20 years before separating nearly 10 years ago. That said, this subsection is not, strictly speaking, relevant to these proceedings as neither party is seeking spousal maintenance.
(l)Need to protect a party who wishes to continue that party's role as a parent
As stated, the wife has the ongoing care of [X]. It would appear that [X] spends little time with his father. That said, [X] is now aged 16 years and will finish his high school studies in the next two to three years.
(m)If either party is cohabiting with another person – the financial circumstances relating to the cohabitation
As stated, the husband now cohabitates with Ms H and he lists his partner’s business as his employer. That said, the husband provides few details about their financial cohabitation.
(n)Terms of any order made or proposed to be made under section 79
These proceedings involve competing applications for property adjustment and not spousal maintenance.
(naa)Terms of any order or declaration made, or proposed to be made, under Part VIIIAB
This consideration is not relevant to the present dispute.
(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
The wife gives evidence that there was no child support assessment until she applied for it in respect of [X] in 2016. There is a current child support assessment that requires the husband to pay $115 per month ($28.75 per week) child support to the wife. The husband asserts that this liability is currently $19 per week after a deduction is applied.
Clearly, in terms of the assessment, the mother bears the greater burden of [X]’s financial support. That said, she and [X] have the benefit presently of residing in the former matrimonial home. In addition, the father asserts that he provides support to the mother by paying the mother’s telephone, internet and home insurance costs.
(o)Any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account
As stated, each party alleges that the other does not use their full capacity to seek suitable employment.
The wife makes the following submissions:[37]
[37] The Wife’s case outline, pages 3-4.
1. The wife adduces evidence from her treating psychologist which goes to her income earning capacity.
2. She is exercising that capacity at her maximum ability, unlike the husband.
3. The result of her work effort is that she is able to derive a basic wage only, effectively less than her needs require.
4. The likelihood is that she will need to “eat into capital’ to survive through the coming and remaining years of her working life rather than saving for retirement
…
6. In contrast, the husband has a vocation as a professional, which he has not exercised by choice since Employer closed its doors and its business in 2013.
7. In addition, he has worked as a professional and in a financial capacity within that family company for many years and has business acumen and skills that could be used by him.
8. He has chosen to give the last twelve months to his partner in support of her business and it is not clear what the expectations or financial arrangement in relation to that is.
9. He has, in the period prior to separation and since, been an advisor, supporter and assistant to his parents in managing their substantial Estate.
…
12. … the husband’s plan seems to be to defer the commencement of any new career as a real estate agent until such time as the likely legal obligation to support his son is over or close to over, with the ancillary disadvantage to the wife that she will expect and can reasonably expect no significant child support from him in the intervening period between now and when [X] reaches his maturity.
The husband makes the following submissions:
…
b. The parties both work but the Applicant’s weekly income is $1,238 compared to the Respondent’s which is $113 [see parties respective Financial Statements].
c. The Respondent borrows money from his parents to assist with his living costs.
d. the youngest child of the parties (15 yrs old) lives with the Applicant.
e. the Applicant’s income earning capacity is currently greater than the Respondent’s.
Lastly, I note that both parties have relatively modest superannuation benefits by today’s standards, in particular the wife.
(p)The terms of any financial agreement that is binding on the parties to the marriage
This consideration is not relevant to the present dispute.
(q)The terms of any Part VIIIAB financial agreement that is binding on a party to the marriage
This consideration is not relevant to the present dispute.
Section 79(4)(f): any other order made under this Act affecting a party to the marriage or a child of the marriage
This consideration is not relevant to the present dispute.
Section 79(4)(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
I refer to previous comments.
Further adjustment findings
Having considered the available evidence in light of the relevant statutory criteria, I am persuaded that an adjustment of 11% in the wife’s favour is appropriate. I find accordingly.
Conclusion
Given the statutory criteria and the above determinations, there will be a final settlement of matrimonial property that will divide the net property pool (valued at $2,618,148) 58% to the wife and 42% to the husband. In monetary terms, given the balance sheet findings, this represents a notional division of assets totalling $1,518,526[38] to the wife and $1,099,622[39] to the husband. The exact dollar amount for monies and/or property that each party will receive will, of course, depend upon the net proceeds received from the sale of the former matrimonial home.
[38] The exact figure of $1,518,525.84 has been rounded to the nearest dollar.
[39] The exact figure of $1,099,622.16 has been rounded to the nearest dollar.
There will be final orders made enabling the wife to receive 58% of the assets and the husband to receive 42%. This will, inter alia require the parties to cause the former matrimonial home to be sold and the net proceeds to be divided.
Although the wife proposed that the husband purchase his interest in the former matrimonial home, the husband did not propose such. That said, the husband through his counsel, indicated in final submissions that the parties may save money overall if one or the other party was able to retain the property as part of the property settlement.[40] Nevertheless, the husband submitted that he has nothing “up his sleeve” financially speaking, to be able to purchase the wife’s interest in the former matrimonial home save for obtaining funding through the generosity of his father.[41] The Court agrees that the available evidence supports that submission. Consequently, as stated, the husband did not ultimately support the wife’s proposal for him to purchase her interest in the former matrimonial home. Unless otherwise agreed, the former matrimonial home will require sale. The final orders can reflect that process.
[40] Transcript, 2 March 2018, p 141.
[41] Transcript, 2 March 2018, p 142.
For simplicity, the final orders will reflect two ‘pools’:
·Firstly, if the former matrimonial home is sold, the division of the net proceeds of sale be divided 58% to the wife and 42% to the husband; and
·Secondly, the division of the other assets (that is, excluding the former matrimonial home but including superannuation) less liabilities (“the Other Assets”), be notionally divided 58% to the wife and 42% to the husband.
This will result in a distribution of the Other Assets (a total net value of $118,148) of which $51,592 is controlled by the wife and $66,556 which is controlled to the husband. Therefore, to effect a 58% notional distribution of the Other Assets, the husband will be required to pay the wife the sum of $16,934. Unless otherwise agreed, this will be paid from his share of the net proceeds of the sale of the former matrimonial home. The following table represents this distribution:
Wife Motor vehicle $25,000 Household Contents $5,000 Bank Account $1,740 Jewellery $3,000 Superannuation $27,202 Less Credit card debt $7,224 ATO debt $3,126 Subtotal $51,592 Plus Amount to be received from Husband $16,934[42] Total (58%) $68,526[43] Husband Household Contents $5,000 Bank Account $388 motorcycle $3,000 Superannuation $62,574 Less Credit card debt $4,406 Subtotal $66,556 Less amount to be paid to Wife from Husband $16,934 Total (42%) $49,622[44] [42] The exact figure of $16,933.84 has been rounded to the nearest dollar.
[43] The exact figure of $68,525.84 has been rounded to the nearest dollar.
[44] The exact figure of $49,622.16 has been rounded to the nearest dollar.
There will be a further order that, subject to any order to the contrary, the parties will retain all property including personal property, superannuation, savings in bank accounts and such held in their sole names or in their respective possessions. Similarly, there will be an order for each party to be solely liable for and indemnify the other against any personal liabilities.
There will also be an order, pursuant to s.106A of the Act, to take effect in the event of default in signing any documentation required by the orders.
I note that the husband sought his costs of these proceedings. In the event that any party still presses their application for costs, they will be required to file an Application in a Case within 28 days.
For all these reasons the Orders of the Court will be as set out at the commencement of these reasons for judgment. Given the factors to which I have referred, I state again that I am satisfied that the Orders made are just and equitable.
I certify that the preceding one hundred and thirty five (135) paragraphs are a true copy of the reasons for judgment of Judge Monahan
Date: 21 February 2019
Key Legal Topics
Areas of Law
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Family Law
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Property Law
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Civil Procedure
Legal Concepts
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Costs
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Remedies
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Jurisdiction
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Injunction
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Procedural Fairness
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