Lillis and Lillis
[2019] FamCA 347
•13 June 2019
FAMILY COURT OF AUSTRALIA
| LILLIS & LILLIS | [2019] FamCA 347 |
| FAMILY LAW – PROPERTY SETTLEMENT – period of cohabitation for almost nine years –assessment of respective contributions – joint endeavour of the parties to become parents through IVF and surrogacy – property inherited post separation – consideration of s.75(2) of the Family Law Act 1975 (Cth) matters – just and equitable – orders made. |
| Family Law Act 1975 (Cth), ss 75(2), 79(2), 79(4) Family Law Rules 2004 (Cth) r 17.03 |
| Holland & Holland [2017] FamCAFC 166 Stanford & Stanford (2012) 247 CLR 108 |
| APPLICANT: | Ms Lillis |
| FIRST RESPONDENT: | Mr Lillis |
| FILE NUMBER: | MLC | 8058 | of | 2018 |
| DATE DELIVERED: | 13 June 2019 |
| PLACE DELIVERED: | Melbourne |
| PLACE HEARD: | Melbourne |
| JUDGMENT OF: | Hartnett J |
| HEARING DATE: | 13 February 2019, 15 February 2019, 12 April 2019 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Ms Smallwood |
| SOLICITOR FOR THE APPLICANT: | Aughtersons |
| COUNSEL FOR THE RESPONDENT: | Mr Puckey |
| SOLICITOR FOR THE RESPONDENT: | Barbayannis Lawyers Pty Ltd |
Orders
The Respondent husband pay to the Applicant wife the sum of $515,877.40 (‘the payment’) within 60 days of the date of these Orders (‘the date’).
In the event that the whole of the payment has not been made by the date, then the Respondent husband sell one or more of the real properties situate at NN Street Suburb M; C Street Suburb D; and/or W Street Suburb Z, all in the State of Victoria, as soon as possible out of Court (‘the sale’) and upon completion of the sale or sales, the proceeds of the sale or sales shall be applied as follows:-
(a)firstly, to pay all costs, commissions and expenses of the sale or sales;
(b)secondly, to discharge any mortgage and any other encumbrance affecting the real property or properties;
(c)thirdly, so much of the payment as is then outstanding together with interest thereon calculated in accordance with r.17.03 of the Family Law Rules 2004 (Cth) from the date, to the Applicant wife; and
(d)fourthly, the balance to the Respondent husband.
The Applicant wife otherwise retain all assets in her possession and ownership including all real property registered in her name.
The Respondent husband otherwise retain all assets in his possession and ownership including all real property registered in his name and including his legal interest in W Street Suburb Z in the State of Victoria.
Unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:-
(a)each party be solely entitled to the exclusion of the other to all property (including choses-in-action) in the possession of such party as at the date of these orders;
(b)each party otherwise forego any claims they may have to any superannuation benefits belonging to or earned by the other;
(c)insurance policies remain the sole property of the owner named thereon;
(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.
Otherwise all extant applications are dismissed and the matter removed from the list.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Lillis & Lillis has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT MELBOURNE |
FILE NUMBER: MLC 8058 of 2018
| Ms Lillis |
Applicant
And
| Mr Lillis |
First Respondent
REASONS FOR JUDGMENT
Background
The wife filed an initiating application on 16 July 2018 seeking final property orders. On 30 January 2019, the wife filed an amended initiating application and it is on that amended application which she relies save that at trial, the wife no longer sought a superannuation splitting order in respect of the husband’s superannuation. The wife sought in lieu that the Court take the differential between the parties’ superannuation entitlements, which is in the sum of $72,866 (and in the husband’s favour) into account in the determination of a just and equitable alteration of the parties’ property interests.
The wife sought that the husband pay to her a sum of $1,047,145 and that otherwise each party retain those real and personal assets currently in their respective possession and ownership, together with retention by each of the husband and wife of their respective superannuation entitlements. This outcome was said by the wife to be an apportionment to her of 45 per cent of the parties net assets, including superannuation.
The husband filed a response on 7 September 2018. He sought dismissal of the wife’s application and a costs order on an indemnity basis. He did not alter his position in the running of the trial.
The husband’s 77 year old mother became a party to the proceedings by Court order made by consent on 13 November 2018.
The Second Respondent filed a response on 1 February 2019 in which she sought dismissal of the wife’s amended application and, relevantly:-
2. That there be a declaration that the Second Respondent [Ms B Lillis] is entitled to be the legal and equitable owner of the property situate at and known as [W Street, Suburb Z].
3. That the Wife pay the 2nd Respondent’s costs including costs on an indemnity basis.
The Second Respondent was subsequently a party to further consent orders made by the Court on 13 November 2018, and relevantly, orders four and five were as follows:-
4. Ms [B Lillis] is hereby joined as a third party to these proceedings.
5. The Respondent husband and the third party each do all things required to stay the Supreme Court of Victoria proceedings no. … in the matter of the Will and Estate of [Mr B Lillis] deceased, until determination of these…proceedings.
On 12 April 2019, being the third day of the hearing, the husband conceded that the real property situate at and known as W Street Suburb Z in the State of Victoria, being property of which the Second Respondent claimed ownership, was in fact real property in which he had an existing legal interest, the husband having inherited the real property upon his father’s death in February 2018 and pursuant to his deceased father’s will dated March 2011. The will clearly provided for the real property to be devised to the husband solely and his delay in making this concession unduly elongated the proceedings. It also went to his not being a witness of credit as to this particular matter. The Second Respondent, not surprisingly, thereafter sought to withdraw from the proceedings. Orders made that day and by consent were as follows:-
1. Orders four and five of the orders made 13 November 2018 be discharged.
2. There be no order for costs between the Applicant and the Second Respondent.
Affidavit evidence relied upon
The wife relied upon the following:-
a)affidavit of evidence-in-chief affirmed 30 January 2019;
b)affidavit supporting application-in-a-case affirmed 7 November 2018;
c)affidavit affirmed 13 July 2018;
d)updated financial statement affirmed 29 January 2019;
e)affidavit of Mr F of G Valuers affirmed 22 January 2019;
f)affidavit of Mr E of G Valuers affirmed 22 January 2019;
g)affidavit of Mr H, valuer, affirmed 7 February 2019;
The husband relied upon the following:-
a)affidavit sworn 4 September 2018;
b)affidavit of evidence-in-chief sworn 30 January 2019;
c)updated financial statement sworn 30 January 2019; and
d)affidavit of Mr J, valuer, filed 30 January 2019.
Expert Valuations
The single expert witness affidavit of Mr F, certified practising valuer and director, affirmed 22 January 2019, provided a valuation of the property known as and situate at K Street Suburb L in the State of Victoria, more particularly described in Certificate of Title Volume … Folio … (‘the Suburb L property’). On 15 September 2008 the Suburb L property was valued at $330,000; on 15 September 2009 at $350,000; and on 10 October 2018, at $720,000.
The single expert witness affidavit of Mr E, certified practising valuer and licenced estate agent, affirmed 22 January 2019, provided valuations for the real properties situate at S Street Suburb M in the State of Victoria, more particularly described in Certificate of Title Volume … Folio … (‘the Suburb M’) and C Street Suburb D in the State of Victoria, more particularly described in Certificate of Title Volume … Folio (‘the Suburb D property’). Those valuations were:-
a)for the Suburb M:-
i)at 15 September 2008 $725,000;
ii)at 15 September 2009 $750,000;
iii)at 6 October 2018 $1,500,000;
b)for the Suburb D property:-
i)at 15 September 2008 $450,000;
ii)at 15 September 2009 $500,000;
iii)at 12 October 2018 $625,000.
In respect of the real property situate at W Street Suburb Z in the State of Victoria, more particularly described in Certificate of Title Volume ... Folio … (‘the Suburb Z property’) the husband and wife obtained separate valuations. In an affidavit affirmed on 30 January 2019, the husband’s valuation expert, Mr J, certified practicing valuer, stated the value of the Suburb Z property as at 24 January 2019 to be $920,000. The wife’s valuation expert, Mr H, API certified practising valuer, REIV sworn valuer and licenced estate agent, stated the value, as at 4 February 2019 to be $935,000.
The affidavit evidence that went to real property valuations was not challenged. The parties accepted the value ascribed to the various pieces of real estate by the single expert witnesses and in the instance where each of the husband and wife obtained an independent valuation (being in respect of the Suburb Z property) the parties compromised the $15,000 difference between the valuations to arrive at an agreed figure of $927,500.
History
Statements of fact in these reasons are findings of fact on the balance of probabilities.
The husband was born in 1962 in Australia. He is now aged 56 years. He is a manager. His income receipt from this source is approximately $140,000 gross per annum. He resides at the Suburb M being unencumbered real property of which he is the sole registered proprietor. Additionally, the husband receives rental income from the Suburb D property of approximately $18,000 gross per annum.
The wife was born in 1966 in Country N. She is a Country P citizen and a permanent resident of Australia. She is now aged 52 years. She works in the clothing industry earning approximately $77,625 gross per annum together with superannuation payments made by her employer. She resides at the Suburb L property being encumbered real property of which she is the sole registered proprietor. Her weekly obligation pursuant to the mortgage encumbrance is $236.
The parties met in July 2008 and commenced their cohabitation in or about September 2008, on the wife’s evidence, or September 2009, on the husband’s evidence. The Court prefers the evidence of the wife as to the commencement date of the parties’ cohabitation. The wife’s lease on the rental premise in which she had resided prior to meeting the husband, and in which she continued to spend some very rare time, ended in September 2009. However, from September 2008, the parties had commenced to spend most nights each week together, in the husband’s home. They, as deposed to by the wife “hardly spent a night apart” save the wife travelled to Country P during April and May 2009 upon the death of her father. At that time, the husband missed the wife “terribly” as stated by him in email correspondence to her, and did not “want to go home to an empty house”. They planned a joint life together. They were significantly committed to each other. To that end, they had, importantly, together attended upon a fertility expert. That consultation in November 2008 was in preparation for in vitro fertilisation (‘IVF’) procedures that would follow. This signified much about the depth of the parties’ relationship by November 2008. Prior to that time, the parties had discovered their inability to naturally conceive, and had discussed their mutual desire to take other steps in their attempts to become parents.
Following approximately two years of cohabitation, the parties were married in 2010. They separated on 10 August 2017 and were divorced in 2018. They had cohabitated for almost nine years. The husband sought to describe this as a short marriage from which each should walk away with no alteration of property interests. It cannot be so categorised, given its length, and the significance of each of the parties’ contributions over that time. One of those contributions was the joint endeavour of the parties to become parents. Between November 2008 and November 2010, the parties underwent several rounds of IVF treatment at IVF Clinic 1. Between April 2011 and May 2012 the parties underwent further IVF procedures at IVF Clinic 2. During both the IVF Clinic 1 and IVF Clinic 2 treatment cycles, the wife had many miscarriages. The procedures were “exhausting emotionally traumatic and physically taxing” for the wife, as described by her.[1]
[1] Affidavit of Ms Lillis affirmed 13 July 2018, 37.
Following the undergoing of IVF procedures, the parties attempted to become parents through surrogacy arrangements. A surrogate mother conceived twins in Country R in August 2012. Such pregnancy derived from the parties implanted embryos. In February 2013 a girl, X, and a boy, Y, were born prematurely at 28 weeks. Both babies died in hospital within 13 days of their birth. Thereafter, in June 2012, the parties travelled together to Country Q, the husband’s country of origin, in a second attempt to conceive a child through a surrogacy arrangement, on that occasion, using donor eggs. The surrogate mother did not conceive. The parties then ceased their attempts to conceive. That chapter in their lives lasted nearly five years and took an enormous toll upon the parties, particularly the wife, being a matter to which I shall return.
Assets and liabilities of the Wife and Husband at Trial
ASSET OWNER VALUE LIABILITY EQUITY K Street, Suburb L Wife $720,000 ($122,795) $597,205
S Street Suburb M Husband $1,500,000
Husband concedes unencumbered for the purposes of trial, the current mortgage encumbrance of approximately $117,000 relating to monies advanced to his parents of which the wife had no knowledge at the time of advancement. The sum advanced was $135,000 being a contribution to the husband’s father’s accommodation at the T Hostel. $1,500,000
V Road
Suburb DHusband $625,000 NIL $625,000 W Street
Suburb ZHusband $920,000 and $935,000 NIL $927,500
agreed by the parties.
Inheritance of the husband post separation.One-sixth share of Street BB, Town CC Country P. Wife $105,950 ($3,875) wife’s proportion of mortgage liability $102,075
Inheritance of the wife. The wife’s mother continues to reside in the property and is the owner of a 2/3 share.
Vehicle 1 Wife $5,900 NIL $5,900 Vehicle 2 Husband $9,500 NIL $9,500 TOTAL: $3,767,180
SUPERANNUATION ASSETS Superannuation 1
Husband $208,624 Total of Wife’s superannuation Wife $135,758 Notation: The parties agreed to otherwise exclude their personal and insignificant bank account balances, credit card debts, and items of furniture.
TOTAL ASSETS & SUPERANNUATION: $4,111,562
ASSETS DISPOSED OF BY HUSBAND Shares sold December 2017 Husband $10,051 $10,051
Potential CGT liability in respect of sale. Husband conceded he is solely responsible for this unknown, if any, liability.
Contribution
At the commencement of cohabitation the wife had the following assets:-
a)savings of approximately $115,872;
b)equity in the Suburb L property of approximately $203,987 given a valuation of $330,000 and then encumbrance of $126,013;
c)Vehicle 3 with a value of approximately $6,000 - $10,000 taking a mid-point of $8,000; and
d)superannuation entitlements of approximately $60,000.
This is a total of $387,859.
At the commencement of cohabitation the husband had the following assets and liabilities:-
a)S Street Suburb M with a value of $725,000;
b)C Street Suburb D with a value of $450,000;
c)savings of approximately $41,000;
d)Vehicle 4 with a value of approximately $31,000;
e)superannuation entitlements of approximately $71,500.
This is a total of $1,318,500. That is, the husband’s initial contribution to the parties’ asset and superannuation pool was 77 per cent as against the wife’s 23 per cent.
In September 2009, when the husband claims the parties cohabitation commenced, a claim which is rejected by the Court, the wife had no savings in her bank account. The husband’s savings had increased to approximately $82,000. It was not entirely clear on the evidence what precisely the wife did with the sum of $115,000. However the evidence did establish that the wife expended those funds during the cohabitation period for the benefit of the parties and in particular:-
a)paid $28,000 for a new motor vehicle;
b)paid approximately $24,000 toward the costs of the IVF procedures;
c)paid mortgage repayments on the Suburb L property of $32,000 and other expenses associated with the property.
During the parties’ cohabitation and marriage the husband’s mother assisted the husband financially by depositing into his bank account sums totalling $124,000. This included a sum of $40,000 which the husband’s mother paid to the parties by way of contribution to the parties’ wedding. The wedding and other associated costs totalled the sum of $80,000. The wife had considered this sum of $80,000 excessive. Many of the husband’s extended family and friends were present at what was a large family wedding. The husband’s mother thus determined to assist the parties in their payment of the wedding expense.
Contributions during cohabitation
Each of the parties contributed their income to the joint expenses of the household. Both spent time during the relationship not in employment and during that time made contributions to the welfare of the family and operation of the household. Whilst each were not generous in their concessions as to the other’s input in this regard, the contributions were nevertheless made. The wife performed the majority of the household cooking and cleaning and the husband assisted the wife in that regard. The wife’s income went to the shortfall in the mortgage repayments due on the Suburb L property, together with the payment of insurances, rates and land tax in respect of that property. The husband’s income paid for all outgoings with respect to the Suburb M and Suburb D properties. The parties contributed equally towards payment of groceries, household expenses and, at differing times, the payment of family health insurance. They also both contributed to minor maintenance and improvement tasks in respect of the Suburb M property.
The husband’s evidence was that he contributed approximately $150,000 toward the costs of international surrogacy as well as the parties travel costs to Country R and Country DD. Whilst the wife is unaware of the exact cost of this endeavour by the parties, she does not take issue with the fact that it was the husband’s income which provided payment for most of that cost. The wife contributed from her savings the initial sum of $24,000 toward the costs of the IVF procedures of the parties and subsequently received Medicare rebates and financial contribution from the husband’s income in respect of that payment. The parties applied significant sums over nearly five years in pursuit of their desire to have a child. For the wife it was particularly onerous. She details the contributions she made in this regard in paragraphs 59 to 83 of her affidavit affirmed 30 January 2019. The Court accepts that evidence. In essence the wife underwent extensive treatment for infertility involving medical procedures under sedation for follicle retrieval and implantation, surgical procedures, months of daily injections of hormones and anticoagulants, ultra sound scans and invasive examinations and blood tests. Prior to those procedures the wife had undergone a diagnostic laparoscopy in November 2008, curettage procedures, pathology tests, and ultrasound examinations.
The impact upon the wife of the above medical procedures included weight gain, bloating, severe abdominal cramping, diarrhoea and vomiting. The wife described her period of time undergoing IVF procedures as follows:-
65. Of the period of 17 months while I had these treatments, I spent 4 months on high doses of Follicle Stimulating Hormone which badly affected my daily moods and emotions, and for those 4 months it felt like an anxious rollercoaster ride psychologically. Over this period I also had 7 general anaesthetics for the retrievals which usually took two or three days to recover from each time. Before the 6 implantations I had to inject myself with Syneral (Nafarelin) twice a day which again affected my moods and emotions and caused me anxiety because it could bring on early menopause. I had 6 implantations which I needed to have sedation for as they were invasive and uncomfortable. Overall the treatments were exhausting, stressful and physically taxing. Whilst the IVF treatments gave us hope, the emotional fallout I experienced from the disappointment each time I did not fall pregnant after the end of each cycle was overwhelming and deeply upset me. I stopped doing many of the activities I previously liked to do over this time including playing tennis, gym, going sailing, bike riding and skiing because physically and emotionally I was not up to it.
66. I attended on an IVF counsellor and IVF Clinic 1, 2 or 3 times in between the cycles to discuss my emotional and physical difficulties but I did not find talking to the counsellor all that helpful because when the next cycle started I just accepted that I had to be physically exhausted and experience emotional disturbances as part of the treatments to fall pregnant.
67. [Mr Lillis] encouraged me to resign from my job at FF Company in mid-2009 to concentrate my efforts for the IVF rounds. I did not work again until around early 2010 when I needed to return to work in order to pay for expenses at [Suburb L] as my savings which I used to pay for these expenses were being depleted. Because of the IVF treatments in 2010 I was unable to commit to full time work as I would require time off to complete each IVF round so I did freelance work to be able to work more at my own pace.
68. I had a number of miscarriages and bleeding during the treatment which were horrible, disappointing and deeply upsetting to experience because it felt like personal failure. I also put on 20 kilograms because of the IVF treatments and my weight went from 73kgs to 93kgs between 2009 and 2011. I also suffered with constant heavy bleeding for up to 12 days at a time and as a result suffered with constantly low iron levels which regularly made me feel light-headed, exhausted and nauseated.
The parties attempt to have a child through surrogacy was ultimately, as said by the wife, “a deeply sad, despairing and dark time for [them] both”. The first trip to Country R in 2011 was a very difficult time for the wife. As deposed to in her affidavit evidence, and accepted by the Court, the wife:-
72.… was fearful and nervous that I would have to have treatment there which was so invasive and intimate. I was panicked about the conditions in the hospital and whether I would be infected during my surgical follicle harvests because of the poor sanitary conditions. I was fearful of being given sedatives and narcotics and waking up scared in a strange place. I developed a particular fear about being sexually assault whilst I was sedated and anaesthetised. I felt on the verge on [sic] a nervous breakdown and I had been on weeks of hormone injections prior to our arrival in City GG.
73. I could not sleep during the first night in [City GG\ and remember thinking that I wouldn’t go through with the retrievals and told [Mr Lillis] I needed to see the hospital first.
74. We visited the hospital the next day. It was small and primitive compared to the hospitals and clinics we attended in Melbourne of course, but the Doctors were friendly and the nurses were quiet but polite. The hospital did not seem like a place where such invasive procedures should be performed. When I went to the toilet at the hospital the floor was flooded with water and there was only an open space in the wall where there should have been a window. Firstly I had another ultrasound of my ovaries at the hospital followed by more blood tests.
75. Despite my anxieties and having come so far with several follicles which were ready to be harvested from me, I went through with the harvest retrieval which required a general anaesthetic with narcotics and sedatives. I made [Mr Lillis] promise that he would be there when I woke up and that he would look after me at our hotel so I didn’t have to stay overnight at the hospital.
The parties were both devastated that they were ultimately unable to have, and raise, children together. The wife perceived, whether rightly or wrongly, that the husband’s family blamed her for the parties’ failure to have children and she became “very withdrawn and depressed” and “reluctant to participate in family life”. In March 2017, the wife was referred by her General Practitioner to a family therapist about the impact, as she perceived it, the husband’s family was having on her, and to get help.
Also during the period of cohabitation, and with the parties having agreed to reside in the Suburb M, the parties rented out the Suburb L property with the rental receipts being applied to the mortgage repayments and other expenses of the property. The parties had intended, at one stage during the cohabitation, to develop the property by obtaining a sub-division of the land and spent over $20,000 on architect fees to obtain a planning permit in respect of that proposed sub-division. They subsequently determined not to proceed with that proposed development but rather, in 2014, to renovate the existing house. Their agreed intent was to have the use for themselves of the Suburb L property whilst still residing primarily in the Suburb M. This they did, for a period of approximately three years, before final separation.
In the renovation of the Suburb L property, both parties were involved in the non-financial contribution of the application of their labour, the husband more so, and the employment of tradesmen with the husband’s income and savings, and $25,000 of the wife’s savings, being applied to the costs. The parties extensively renovated the Suburb L property after the departure of the tenants in 2014. Both made a significant contribution. The husband claims he expended approximately $50,000. Whilst the husband clearly expended monies earned during the relationship, together with monies advanced by his mother, the husband’s claim as to the quantum expended cannot be found on the necessary standard of proof given the wife disputes the extent of financial contributions made by the husband, and there is otherwise insufficient corroborative or other evidence as to his claims. The Court is satisfied however he contributed financially, and in no inconsequential way, to the renovation.
The wife assisted the husband in the maintenance of the Suburb D property by assisting in the cleaning, furnishing and maintaining of the outdoor area from time to time. She also purchased some items, such as curtains and curtain rods, and shelving, for use in the rental property.
The wife asserted that she also made a contribution to the husband’s family and in particular by assisting the husband in assisting his parents run their numerous investment (rental) properties. She claimed to be significantly involved in the collection of cash rental payments from tenants and also claimed to have carried out maintenance jobs in respect of some of these properties. The Court does not accept the wife’s evidence in this regard. The Court prefers that of the husband and accepts that the husband’s parents employed real estate agents to manage their rental properties save for one property, at JJ Street Suburb Z, where the tenant did for a time pay cash monies to the husband’s mother, and where on two or three occasions those payments were made to the husband for him to pass on to his mother. The Court finds that the wife made no contribution which would be accorded any weight in respect of the husband’s parents various real properties. The wife was not a credible witness in respect of these matters.
Contributions post separation
The husband has inherited his legal interest in the Suburb Z property post separation. It is a significant contribution made solely by him. [2] Likewise, the wife inherited her legal interest in the property in Country P but prior to separation. It is a contribution, in much small measure, made solely by her. The husband’s inheritance, and its value is a factor that weighs heavily in the consideration of what ultimate adjustment should be made between the parties in respect of their property interests. That, coupled with the husband’s significantly greater financial contribution at commencement of the relationship requires a movement away from anything approaching equality between the parties. Their contributions, equal, during the cohabitation period, and the wife’s small adjustment necessary in respect of s.75(2) of the Family Law Act 1975 (Cth) (‘the Act’) matters may well have resulted in apportionment to the wife of something slightly more than equality. But these pre and post financial contributions of the husband, in the context of this marriage and its length, are significant and must be appropriately acknowledged.
[2]Holland & Holland [2017] FamCAFC 166
Section 75(2) matters
In August 2017, the husband indicated to the wife his desire for a separation. Actual separation occurred. The wife left the former matrimonial home and took up residence in the Suburb L property, a property she had not permanently lived in since at least, September 2008. At separation, the wife’s financial position was far more dire than the husband’s, even on the husband’s own account which is not accepted by the Court. Added to that were the wife’s presenting medical issues. She had been retrenched from her employment in July 2017. Around this same time, the wife had developed large fibroids in her uterus. She was thereafter referred to a fibroid specialist. In October 2017, the wife had surgery to embolise the fibroids having, between July and October 2017, attended at a hospital on several occasions to receive six iron transfusions. These health difficulties of the wife resulted in the wife’s inability to work between July 2017 and March 2018. She received no income for this period but did receive a Newstart Allowance from Centrelink. Additionally, the wife drew down on the mortgage encumbering the Suburb L property to pay for her living expenses. The supplementation of her living expenses resulted in a further drawdown by the wife of the mortgage encumbering the Suburb L property in the sum of approximately $66,500.
Since the parties separation in August 2017, the husband has been able to pay the sum of $100,000 in legal costs. He gave evidence such monies were derived from savings and income. He then altered that evidence to claim the monies derived solely from income. He had, in his affidavit and other evidence sworn that he had no significant savings at separation. Indeed the husband claimed to have no money. His evidence was that he needed to cash in his shareholding of approximately $10,000 to be expended by him on necessary living costs, to the exclusion of the wife. The Court does not accept that the husband’s financial position warranted that action. He was in occupation of an unencumbered home save to the extent it was encumbered by monies advanced to his parents which he did not seek reimbursement of; rental receipts from an investment property; and some savings. It is clear that his earning capacity, his lack of debt in respect of his accommodation and the funds given to him by his mother placed him in a superior financial position to the wife with superior financial resources available. He was without income between contracts for only a few weeks.
Since separation the husband has reduced the mortgage encumbrance over the Suburb M of $135,000, being the monies advanced by him to his parents, by the sum of $18,000. This reduction has come about by application of his post separation income to which the wife has made no contribution.
The parties have now a differing income, and earning capacity, both significantly in the husband’s favour. Additionally, the husband is assisted in a habitually ongoing manner by the financial resource which is the payments made to him by his mother. Since separation, she has provided a further $34,000 to him.
The husband’s father died in February 2018. He left a will, which relevantly provided for the husband to inherit all of his father’s title and interest in the Suburb Z property as earlier referred to in these reasons. In his financial statement filed on 7 September 2018, the husband did not disclose this interest. Further, on 23 July 2018, shortly after the service upon the husband of the wife’s application for property orders, the husband, his mother (who became the Second Respondent) and the husband’s only sibling, his brother, executed a “Deed of Family Arrangement” which provided for the husband’s mother to receive the Suburb Z property as her own, subject to her making provision in her will for the husband and/or his issue being entitled to receive the Suburb Z property through a testamentary trust following the Second Respondent’s death. The husband’s mother filed an originating motion with the Supreme Court of Victoria on 17 September 2018 pursuant to Part IV of the Administration and Probate Act 1958 (Vic) seeking in essence, a transfer of the Suburb Z property to her. Those proceedings were stayed during the currency of these proceedings. The husband now concedes that he has available to him the sole registered proprietorship of this property.
The husband thus has greater assets and financial resources available to him than the wife.
Conclusion
Despite the manner in which the husband presented his case, on the evidence as detailed in these reasons, it is clearly just and equitable to alter the legal and equitable interests of the parties in property from that which currently exists. There has been a “voluntary severance of the mutuality of the marital relationship”.[3]
[3]Stanford & Stanford (2012) 247 CLR 108, 42.
The s.79(2) of the Act assessment of what orders are just and equitable as between the parties, is in this case, referrable to, in particular, the contribution based factors in s 79(4)(a) – (c) of the Act. The direct financial contributions of the husband significantly outweighed those of the wife. The non-financial contributions of the wife during cohabitation and marriage in the capacity of home-maker and in her contribution to the parties’ infertility issues were considerable.
The assets to be divided, including superannuation total $4,111,562. Each party desires to retain ownership of that which they currently have. The wife currently has ownership of $840,938 of the total assets and superannuation pool of the parties. The husband has ownership of $3,270,624.
The husband seeks no alteration of property interests. This would see an asset division of 79.5 per cent to him and 20.5 per cent to the wife.
The wife seeks approximately 45 per cent of the assets available which is $1,850,202.90. This would result in a payment to her from the husband of $1,009,264.90.
The husband’s direct financial contribution requires a significant percentage adjustment to him to reflect that contribution over and above the s.75(2) of the Act matters adjustment in the wife’s favour.
A thirty-three per cent adjustment of the assets and superannuation of the parties ($4,111,562) to the wife would result in her receiving an amount of $1,356,815.40. From this must be deducted the assets and superannuation already held by the wife. What remains is the necessary cash payment from the husband to the wife of $515,877.40 to achieve such an outcome. The Court determines that this alteration of property interests in all the circumstances is just and equitable.
I certify that the preceding forty-six (46) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Hartnett delivered on 13 June 2019.
Associate:
Date: 13 June 2019
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