Lundquist & Lundquist (No 3)
[2024] FedCFamC2F 1556
•8 November 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Lundquist & Lundquist (No 3) [2024] FedCFamC2F 1556
File number(s): SYC 7577 of 2022 Judgment of: JUDGE SHOEBRIDGE Date of judgment: 8 November 2024 Catchwords: FAMILY LAW – Property – Where the parties have property in the United Kingdom and Australia – Where the Respondent wife raised an issue of forum non conveniens – Where part of the property pool is situated in company assets – Where the Applicant husband received substantial post-separation inheritance – Where inheritance is treated as a separate pool – Where the Court makes an equal contributions finding as to the non-inheritance pool – Where s 75(2) adjustment made in favour of the wife Legislation: Family Law Act 1975 (Cth) s 75(2), 79(1), 79(2), 79(4) Cases cited: Bakshi & Mahanta (No 2) (2022) 367 FLR 177; [2022] FedCFamC1A 90
Bevan v Bevan (2013) FLC 93-545; [2013] FamCAFC 116
Calvin and McTier (2017) FLC 93-785; [2017] FamCAFC 125
Clauson and Clauson (1995) FLC 92–595;
Clives v Clives (2008) FLC 93-385; [2008] FamCAFC 172
Dickons & Dickons (2012) 50 Fam LR 244; [2012] FamCAFC 154
Dovgan & Dovgan [2021] FamCA 306
Fields v Smith (2015) FLC 93-638; [2015] FamCAFC 57
Franklin v Franklin [2010] FamCAFC 131
Henry v Henry (1996) 185 CLR 571
Hickey and Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143; [2003] FamCA 395
Horrigan & Horrigan [2020] FamCAFC 25
In the Marriage of Bonnici (1991) FLC 92-272
In the Marriage of Ferraro (1992) FLC 92-335
In the Marriage of Rolfe (1977) FLC 90-629
In the Marriage of Waters & Jurek (1995) FLC 92-635
Jabour & Jabour (2019) FLC 93-898; [2019] FamCAFC 78
Mallet v Mallet (1984) 156 CLR 605
Navarro v Jurado (2010) 44 Fam LR 310; [2010] FamCAFC 210
Norbis v Norbis (1986) 161 CLR 513
Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197
Omacini and Omacini (2005) FLC 93-218; [2005] FamCA 195
Petruski & Balewa (2013) 49 Fam LR 116; [2013] FamCAFC 15
Schaars & Schaars [2023] FedCFamC1F 12
Stanford v Stanford (2012) 247 CLR 108
Teal v Teal [2010] FamCAFC 120
Trask & Westlake (2015) FLC 93-662; [2015] FamCAFC 160
Trevi and Trevi (Re-Exercise) [2019] FamCAFC 51
Van der Linden v Kordell [2010] FamCAFC 157
Voth v Manildra Flour Mills Pty Ltd(1990) 171 CLR 538
Zao & Lee [2019] FamCAFC 169
Division: Division 2 Family Law Number of paragraphs: 182 Date of last submission/s: 10 August 2024 Date of hearing: 8 – 10 August 2024 Place: Sydney Counsel for the Applicant: Ms McMahon Solicitor for the Applicant: Cominos Family Lawyers The Respondent: Litigant in person ORDERS
SYC 7577 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MR LUNDQUIST
Applicant
AND: MS LUNDQUIST
Respondent
ORDER MADE BY:
JUDGE SHOEBRIDGE
DATE OF ORDER:
8 NOVEMBER 2024
THE COURT ORDERS THAT:
The Australian Properties
1.Within 28 days of the date of these Orders, the parties are to do all things necessary to cause the Respondent Wife’s (“the Wife”) interest in each of the three properties listed below (“the Australian Properties”) to the Applicant Husband (“the Husband”):
(a)C Street, Suburb D;
(b)E Street, Suburb F; and
(c)G Street, Suburb H.
2.To give effect to the preceding Order:
(a)The Husband is to be responsible for the preparation of any documentation necessary to transfer the Wife’s interests in each of the Australian properties to him;
(b)The Wife is to execute and return and documentation delivered to her in that regard within 7 days of the receipt of same; and
(c)The Husband is responsible for the registration of any such documentation.
3.Within 90 days of the date of these Orders, the Wife is to remove all of her belongings from, and vacate, the properties located at:
(a)C Street, Suburb D; and
(b)E Street, Suburb F.
Husband to Retain
4.The Husband is otherwise entitled to retain:
(a)Bank accounts and investments standing in his name or control;
(b)His superannuation entitlements, and for the sake of clarity that includes his superannuation entitlements in the United Kingdom;
(c)Motor Vehicle 1; and
(d)Any other item of personalty or financial resource in his possession or control.
The United Kingdom Property
5.Within 28 days of the date of these Orders the parties are to do all things necessary to transfer the Husband's interest in J Street, Suburb K (“the Suburb K Property”) to the Wife and in that regard:
(a)The Wife is responsible for the preparation of any documentation necessary to transfer the Husband’s interest in the Suburb K Property to her;
(b)The Husband is to sign and return any documentation delivered to him in that regard within 7 days of the receipt of same; and
(c)The Wife is responsible for the registration of any such documentation.
Loan Refinances
6.Simultaneously with the transfer of the Wife’s interests in the Australian Properties to the Husband, the Husband is to do all things and sign all things necessary to refinance the following ANZ mortgage accounts into the Husband’s sole name:
(a)…42;
(b)…25;
(c)…22;
(d)…55; and
(e)…09.
7.Simultaneously with the transfer of the Wife’s interests in the Australian properties to the Husband, the Husband is to do all things and sign all things necessary to refinance the following M Bank mortgage accounts into the Husband’s sole name:
(a)…89;
(b)…78;
(c)…00;
(d)…97; and
(e)…86.
8.Simultaneously with the transfer of the Wife’s interests in the Australian properties to the Husband, the Wife is to do all things and sign all documents necessary to refinance the following M Bank mortgage accounts into the Wife's sole name:
(a)…97; and
(b)…78.
9.The Husband is to pay the outstanding balance of the L Bank mortgage.
Wife to Retain
10.The Husband is to do all things and execute all documents necessary to transfer his interest in Motor Vehicle 2 to the Wife and in that regard:
(a)The Wife is to prepare any documentation necessary to give effect to this Order; and
(b)The Husband is to execute any documentation received from the Wife in that regard and return it to her within 7 days of receipt of the same.
11.Unless otherwise specified in these Orders, the Wife is solely entitled, to the exclusion of the Husband, to the following:
(a)The property located at J Street, Suburb K; and
(b)N Pty Ltd (“the Company”), and it is noted that the assets of the Company include:
(i)Vehicle 6;
(ii)Vehicle 7; and
(iii)Vehicle storage in Country V.
12.The Wife is otherwise entitled to retain:
(a)Bank accounts and investments in her name or control;
(b)Two motor vehicles located in the UK including Motor Vehicle 2, Motor Vehicle 3 and Motor Vehicle 4; and
(c)Any other item of personalty in her possession or control or financial resource.
The Company
13.Within 28 days of the date of these Orders, the parties are to each respectively do all things necessary to:
(a)Remove the Husband as a director of the Company;
(b)Transfer the Husband’s shareholding in the Company to the Wife, or her nominee;
(c)Remove the Husband as a signatory of any accounts held in the name of the Company; and
(d)Cancel the credit card held by Husband in connection with P Bank account number …34 in the Company name.
14.To give effect to the preceding Order:
(a)The Wife is to prepare any documentation necessary to give effect to the matters referred to in that Order; and
(b)The Husband is to execute and return any documentation delivered to him in that regard within 7 days of receipt of same.
15.Within 28 days of these Orders, the Husband is to pay the outstanding balance of the following mortgage and loan accounts relating to assets held by the Company:
(a)KK Finance mortgage account number …05.
(b)KK Finance mortgage account number …57.
(c)KK Finance mortgage account number …06.
(d)KK Finance mortgage account number …56.
(e)KK Finance mortgage account number …55.
(f)KK Finance mortgage account number …17.
(g)P Bank Loan Account …93.
Miscellaneous
16.Within 28 days of the date of these Orders, the parties are to each respectively do all things necessary to close the joint ANZ Access Account ending …82 held in Australia, and the proceeds of that account, if any, are to be divided equally between the parties.
17.Within 28 days of the date of these Orders, the parties are to do all things necessary to transfer any funds held in the Q Bank Account ending in …76 into the sole name of the Wife.
18.In relation to the debt owed to the parties by Mr R:
(a)Within 31 days of the date of these Orders the parties are to do all things necessary to remove the Husband as a mortgagor for that debt;
(b)The Husband is to do any thing and sign any document necessary to assign to the Wife any interest that the Husband may have in relation to that debt; and
(c)The Wife is solely entitled to enforce that debt; and
(d)The Wife is solely entitled to any repayment of that debt.
19.Within 90 days of the date of these Orders, the Husband is to pay to the Wife the sum of $16,341, provided that that sum may be offset against any amounts owed by the Wife to the Husband as a consequence of any costs Orders made in the course of these proceedings that remain unpaid.
20.The Husband is to indemnify and keep indemnified the Wife, in respect of all actions, claims, suits, and demands as may be made against the Husband in relation to all liabilities in the name of the Husband.
21.The Wife is to indemnify and keep indemnified the Husband, in respect of all actions, claims, suits, and demands as may be made against the Wife in relation to all liabilities in the name of the Wife.
22.Save as is provided for in these Orders, each party is to be solely liable for and indemnify the other against any liability encumbering any item of property (including real property) to which that party is entitled pursuant to these Orders.
23.Except as specifically provided for in these Orders, each of the Husband and Wife are to remain solely liable for any debts in that party’s own name and release the other from all debts owing from one to the other.
24.Each of the parties, within 14 days of receiving a written request from the other party, shall do all things and sign all documents to ensure that these Orders are recognised and enforced in any other jurisdiction where their respective property is held, pursuant to the doctrine of comity of nations.
25.Each party is to do all acts and things reasonably required by the other including the signing or execution of all necessary documents to give effect to the provisions of these Orders.
26.In the event that either party refuses or neglects to execute any deed or instrument, the Registrar of the Federal Circuit and Family Court of Australia or other person appointed pursuant to s 106A of the Family Law Act 1975 (Cth), shall do all acts and things and sign all documents necessary on behalf of the defaulting party, to give validity to the operation to the deed or instrument and at the cost of the defaulting party.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE SHOEBRIDGE:
INTRODUCTION
This is an application for property adjustment commenced by Mr Lundquist (“the Husband”) on 27 October 2022.
Ms Lundquist (“the Wife”) filed a Response to the Initiating Application on 7 December 2022. The Wife has, at various times throughout these proceedings, objected to this Court as the appropriate forum for the hearing of this dispute. At other times, the Wife has taken steps in the proceedings that were inconsistent with her objection to this forum.
The matter proceeded to a contested final hearing for three days commencing on 8 October 2024.
Background
The Husband is currently 66 years of age.
The Wife is currently 63 years of age.
The Husband and the Wife commenced living together in 1983. They were married in 1984.
Both were born in Australia and married whilst they were living in Australia. They moved to the United Kingdom in 1987.
Though there is some disagreement as to when the parties returned to live in Australia, it seems clear enough from the oral evidence at trial that between late 2020 and at least mid-2023, the parties lived at various times in the United Kingdom and at other times in Australia.
The Husband says that the parties separated on a final basis on 15 November 2021.
The Wife says that the parties separated in October 2022.
Regardless of when the parties in fact separated, it is common fact that since November of 2021 the Wife has had the physical possession of the parties’ properties at Suburb D in New South Wales and at Suburb F in New South Wales.
The Husband's mother passed away in mid-2023.
Though the administration of her estate is ongoing, there is sufficient clarity for current purposes in relation to the value of the assets that the Husband has inherited from his late mother's estate.
Litigation history
It is necessary, in my view, to set out some of the history of this litigation.
The Husband’s Initiating Application (“the Property Application”) was filed on 27 October 2022.
On 25 November 2022 the Husband filed an Application for a Divorce (“the Divorce Application”).
The Wife filed a Response to the Property Application on 7 December 2022. By that Response, the Wife sought a division of the net assets of the parties such that she would receive 60% of those assets and the Husband would receive 40%. At that time the Wife was represented by solicitors. That Response did not indicate any objection by the Wife to this Court being an appropriate forum for the determination of that dispute.
The Property Application came before a Judicial Registrar on 7 December 2022, at which time it was adjourned until 6 March 2023. The parties consented to Orders in relation to disclosure and mediation, amongst other things. There was no indication on that date that the Wife was opposed to this Court as an appropriate forum for the determination of the Property Application.
On 31 January 2023 the Wife filed a Response to the Divorce Application. In that Response the Wife asserted that:
(1)The date of separation set out in the Divorce Application was incorrect;
(2)She had not been properly served with the Divorce Application;
(3)She had not been made aware on 7 December 2022 (when the Property Application was mentioned before the Court) that there was a Divorce Application;
(4)She had experienced difficulty contacting her solicitors; and
(5)Her inspection of the Commonwealth Court Portal did not reveal the filing of the Divorce Application until 30 January 2023.
There was no suggestion in that Response that the Wife objected to this Court as an appropriate forum for the determination of the Divorce Application.
When the Divorce Application came before the Court the next day, that is 1 February 2023, the Husband was given permission by the Court to discontinue that Application. Notations to the Orders made on that date reflect the disagreement between the parties about the date of separation. There is no indication of any objection to jurisdiction or forum.
The first firm of solicitors to act for the Wife filed a Notice of Ceasing to Act on 22 February 2023. That document was signed by the relevant solicitor on 13 February 2023.
When the Property Application came before the Court on 6 March 2023, the Husband was given leave to issue subpoena to two banks and the Wife was again ordered to produce all of the documents referred to in the Orders that she consented to on 7 December 2022.
The Property Application came before the Court again on 29 May 2023. On that date, the Husband was represented by his current solicitors and the Wife represented herself. The matter was listed for a Conciliation Conference to be held on 7 September 2023 and in the notations to the Orders made on that date the Court noted that all issues in relation to valuation have been attended to. It also noted that the parties assured the Court that any outstanding disclosure would be attended to prior to the Conciliation Conference.
Despite that, it appears that there must have been some outstanding issue in relation to valuations because on 30 May 2023 the Court ordered that the Husband would do all things necessary to engage valuers in relation to the real properties in the United Kingdom and the real properties in Australia. The Court ordered that all communication with the valuers was to be undertaken by the Husband and that the valuers were to follow the direction of the Husband. Notation A to the Orders made by a Judicial Registrar noted there had been “unreasonable delay on the part of the Wife in these proceedings with orders made in the form of today's orders to ensure that the matter may proceed to a mediation/conciliation conference”.
On 8 September 2023 a Conciliation Conference was held at the Court. The Certificate of Dispute Resolution that was filed in relation to that Conciliation Conference confirms that both parties attended the Conciliation Conference. The Certificate indicates that the Husband made a genuine effort to resolve the issues in dispute. However, the Certificate indicates that the Wife did not make a genuine effort to resolve the issues in dispute.
On 10 September 2023 the Wife was ordered to file a Response to the Property Application setting out with precision the final orders that she sought by 14 September 2023. The matter was otherwise listed for a Compliance and Readiness Hearing to be heard on 15 September 2023.
The Wife did not file a Response to the Property Application that particularised the orders that she sought.
On the Certificate of Readiness for Trial the Wife has indicated, amongst other things, that the trial is likely to take two days. That Certificate was signed by the Wife herself on 12 September 2023. It does not indicate any objection to forum.
On 14 September 2023 the Wife filed an Undertaking as to Disclosure.
On 15 September 2023 the Wife filed a Case Summary Document. The Case Summary Document identifies what are, from the Wife's point of view, factual issues that require determination at final hearing, factual issues relating to the Wife's state of health, valuation issues indicating that the Wife was not satisfied with the expert opinions, complaints by the Wife about lack of disclosure by the Husband, and complaints by the Wife about lack of access to funds for legal representation. The document indicated that the proposed witnesses for trial would be the Husband and the Wife, and the Wife indicated that she would be forwarding questions to valuers.
On 15 September 2023 trial directions were made. Those directions included that:
(1)By 4.00 pm on 12 October 2023 each party must do all things necessary to satisfy their duty of full and frank disclosure and file and serve an Undertaking as to Disclosure.
(2)The matter was listed for final hearing for three days commencing on 19 August 2024.
(3)The Husband was to file and serve any amended Initiating Application and updated single consolidated trial Affidavit and an updated Financial Statement by 29 July 2024.
(4)The Wife was to file and serve any amended Response, an updated single consolidated trial Affidavit and an updated Financial Statement by 5 August 2024.
(5)Both parties were to file and serve a Case Outline no later than two days prior to the trial date and the contents of the Case Outline were set out in the directions.
(6)All documents required to be filed and all other documents sought to be relied upon were to be filed or provided in electronic format to the Court and to each other party.
On 29 September 2023 the Wife filed an Application for Review in relation to the Conciliation Conference that was conducted on 7 September 2023. The contents of that document are convoluted and difficult to understand, in my view. That Application was dismissed by Judge Murdoch on 2 November 2023 after a contested hearing. The Wife was ordered to pay the Husband’s costs of and incidental to that Application fixed in the sum of $3,349.37. Those costs have not been paid.
On 6 November 2023, the Husband filed a second Divorce Application.
On 21 December 2023 the Husband’s second Divorce Application came before the Court. On that occasion, the Wife appears to have informed the Court that:
(1)She opposed the Divorce Application being heard, on the basis of forum non conveniens; and
(2)She had filed an Application for Divorce in the United Kingdom in late 2023.
Directions were made for the filing of affidavits in relation to the Divorce Application and the contested Divorce was listed before Judge Neville for a Compliance and Readiness Hearing on 22 April 2024. It was noted on that occasion that:
(1)The Divorce Application is contested on the basis that the Wife asserts that the divorce proceedings should be heard in the United Kingdom;
(2)The Wife submits that she is domiciled in the United Kingdom;
(3)The Wife alleges that there will be capital gains tax implications;
(4)The Wife had filed an Application for Divorce in the Family Court of the United Kingdom in late 2023; and
(5)Both parties were living in Australia as at 21 December 2023.
That occasion was the first time that the Court file reflects any objection by the Wife to this Court determining any dispute between the parties.
On 10 April 2024 the final hearing dates for the Property Application were vacated and the trial was listed to start on 8 October 2024.
Trial directions were amended on 22 May 2024 by Judge Kemp and relevantly the Wife was to file and serve any Amended Response setting out with particularity the precise orders that she sought, an updated single consolidated trial Affidavit, and updated Financial Statement by 3 September 2024.
On 27 June 2024 the contested Divorce was heard. The Wife on that occasion made an application for an adjournment, which was denied. The Court declared that Australia was an appropriate forum. A decree nisi issued. The Wife on that occasion was ordered to pay the costs of the Husband fixed in the sum of $14,571. That Costs Order has not been paid.
The Wife lodged a Notice of Appeal against the Orders made on 27 June 2024. That Appeal is yet to be heard.
I have not set out in this history all of the various Applications seeking interim relief, nor all of the occasions on which this matter was mentioned before the Court. I have set out the history above because it will help to understand some of the matters that arose in the trial.
The Wife has not filed a Response in the Property Application other than the one that I have referred to filed on 7 December 2022.
In relation to the trial directions, as amended on 22 May 2024, the Wife did not file an Affidavit, an updated Financial Statement or a Case Outline.
THE WIFE’S FURTHER FORUM NON CONVENIENS APPLICATION
On 4 October 2024, that is to say the last working day before the trial of this matter was due to commence, the Wife filed an Application in a Proceeding. She sought to have the Property Application proceedings stayed on the basis that Australia was not the appropriate forum for the determination of that dispute. In the alternative, she sought to have the matter transferred to the Federal Circuit and Family Court of Australia (Division 1).
I dismissed that Application. I gave ex tempore reasons for doing so and said that I would deliver more fulsome reasons at a later time. I do that now.
The Wife advanced a forum non conveniens argument in response to the Husband’s second Divorce Application. The grounds for that Application were identical to the grounds advanced on this occasion. In summary, the Wife believes that the United Kingdom is a more appropriate forum because the parties lived there for a large portion of their time together, because there are (she says) some potential tax consequences of the Orders sought in these proceedings, and because she has filed a Divorce Application in the United Kingdom.
On 27 June 2024, when the Court heard the contested Divorce Application, the Court declared that it was satisfied that Australia was an appropriate forum and granted the decree nisi. The Wife has filed an Appeal against that decision. However, that decision remains in force for now and I am not persuaded that I should look behind that decision simply because it is the subject of an Appeal.
In any event, I would have dismissed the Application on its merits. The United Kingdom may very well be another jurisdiction where this dispute could be determined. That is not the test.
The relevant general principle is that:
...a stay should be granted if the local court is a clearly inappropriate forum, which will be the case if continuation of the proceedings in that court would be oppressive, in the sense of “seriously and unfairly burdensome, prejudicial or damaging”, or, vexatious, in the sense of “productive of serious and unjustified trouble and harassment.[1]
[1] Henry v Henry (1996) 185 CLR 571 at 587; Voth v Manildra Flour Mills Pty Ltd(1990) 171 CLR 538 at 564–565; Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 at 247 per Deane J.
In order to grant the stay sought by the Wife, I would have to be satisfied that these proceedings “would be productive of injustice, because it would be oppressive in the sense of seriously and unfairly burdensome, prejudicial or damaging, or vexatious in the sense of productive or [sic] serious and unjustified trouble and harassment”.[2]
[2] Navarro v Jurado (2010) 44 Fam LR 310 at 316 [24].
The focus is not on whether or not the United Kingdom might be a more appropriate forum, but rather on whether or not Australia is a clearly inappropriate one.[3]
[3] Bakshi & Mahanta (No 2) (2022) 367 FLR 177 at [51] (“Bakshi”).
The onus of establishing that Australia is a clearly inappropriate forum rests in this matter with the Wife.[4]
[4] Bakshi (2022) 367 FLR 177 at [52].
There is real property held in both the United Kingdom and in Australia. The Wife expressed a concern about the extent to which Orders of this Court could be practically implemented in relation to the United Kingdom assets. I pointed out to her that I could see no reason why the Orders of this Court could not be crafted in terms that were in personam.
The proceedings in Australia are progressed to the stage where a trial is due to commence. There is apparently an Application for Divorce filed by the Wife in the United Kingdom which is currently adjourned. There are no property proceedings in the United Kingdom.
There is no evidence to support the Wife’s assertions that there are legal or tax related hurdles confronting the parties in the United Kingdom if the matter is determined in Australia.
The parties have lived for a greater portion of the marriage in the United Kingdom, however, they are both Australian citizens and have lived in Australia at times during their marriage.
The parties, and the Husband in particular, have expended considerable sums on legal fees in relation to these proceedings to arrive at this point.
The Wife has been inconsistent in her attitude towards this forum. At times she has made disclosure, signed a Certificate of Readiness for Trial, submitted to trial directions and taken various other steps that are inconsistent with her forum argument.
Even if the Wife’s Appeal against the Orders made on 27 June 2024 is successful, I find that this Court is not a clearly inappropriate form for the determination of the Property Application.
In relation to the Wife’s contention that these proceedings should be transferred to Federal Circuit and Family Court of Australia (Division 1), her argument in support of that seemed to be confined to a misunderstanding on her part about the difference between a superior court of record and an inferior court. In the absence of any sensible reason why I should do so, I decline to transfer the proceedings.
DOCUMENTS RELIED UPON
The Husband relied upon the following documents:
(1)Amended Initiating Application filed on 27 August 2024;
(2)Affidavit of the Husband filed on 27 August 2024;
(3)Financial Statement of the Husband filed on 27 August 2024;
(4)Email from Cominos Family Lawyers to Respondent dated 23 March 2023 (“Exhibit 2”);
(5)Email from Cominos Family Lawyers to Respondent dated 12 May 2024 (“Exhibit 3”);
(6)Email from Cominos Family Lawyers to Respondent dated 11 August 2023 (“Exhibit 4”);
(7)Email from Cominos Family Lawyers to Respondent dated 16 September 2024 (“Exhibit 5”);
(8)Email from Cominos Family Lawyers to S Lawyers dated 30 January 2023 (“Exhibit 6”);
(9)Email from Cominos Family Lawyers to Respondent dated 17 August 2023 (“Exhibit 7”);
(10)Email from Cominos Family Lawyers to Respondent dated 25 June 2024 (“Exhibit 8”);
(11)Screenshot of Respondent’s disclosure uploaded to Dropbox folder as at 9 October 2024 (“Exhibit 9”);
(12)Email from Cominos Family Lawyers to Respondent dated 14 August 2024 (“Exhibit 10”); and
(13)Amended Balance Sheet and Orders Sought by Applicant (“Exhibit 11”).
The Wife relied upon the following documents:
(1)Response to Initiating Application filed on 7 December 2022; and
(2)Letter to NSW Trustee & Guardian re Lundquist Superannuation Fund dated 22 February 2016 (“Exhibit 1”).
Both parties relied upon the following:
(1)Affidavit of Mr T filed on 30 September 2024. Mr T is the single expert who valued the real properties in the United Kingdom; and
(2)Affidavit of Mr U filed on 30 September 2024. Mr U is the single expert who valued the real properties based in Australia.
THE ISSUES
In relation to the pool:
(1)The Husband contended for a “split pools” approach, where one pool was comprised of any benefit that he has derived from his late mother’s estate (“the Inheritance Pool”), and the other pool included any other relevant item (“the Non-Inheritance Pool”). The Wife was opposed to that approach.
(2)The Husband contended for a number of “add-backs”, which the Wife opposed.
In relation to a percentage adjustment:
(1)The Husband contended at the commencement of trial for a division of the Non‑Inheritance Pool in the proportion of 57% of that pool to the Wife and 43% to himself. That position changed at the time of submissions to a contention for 50% each of that pool. He sought that there be no adjustment to the Inheritance Pool.
(2)The Wife was opposed to that percentage division, though she could not articulate what percentage she said was appropriate if a single pool was adopted. She said that if the “split pools” approach was adopted, the appropriate division would be 60% of the Non‑Inheritance Pool and 20% of the Inheritance Pool to herself.
In relation to the particular assets that each party was to obtain/retain:
(1)The Husband sought to retain all of the Australian real properties. The Wife was opposed to that and said that she would like to retain the Suburb F Property.
(2)The Husband initially contended for the Wife to retain all of the United Kingdom based property, save for Vehicle 6 referred to below. However, by the time of submissions, the Husband contended for the jointly owned Suburb K Property in the United Kingdom to be sold and the proceeds divided between the parties so as to achieve a 50/50 split of the Non-Inheritance Pool. The Wife opposed the sale of the Suburb K Property.
(3)The Husband sought to obtain Vehicle 6, which is owned by N Pty Ltd (“the Company”). The Wife was opposed to the Husband receiving Vehicle 6, though she was not opposed to him receiving the Vehicle 7, stored in Country V. The Vehicle 7 and its storage are also owned by the Company.
PROPERTY ADJUSTMENT – LEGAL PRINCIPLES
In circumstances where both parties contend that orders should be made for the adjustment of their property upon the breakdown of their marital relationship, the task before the Court is to make such orders as are appropriate just and equitable having regard to the language of both s 79(1) and s 79(2) of the Family Law Act 1975 (Cth) (“the Act”).[5]
[5] Zao & Lee [2019] FamCAFC 169 at [48].
In exercising its discretion, the Court is required to take into account the matters set out in s 79(4) of the Act. Section 79(4) is divided into two limbs. The first limb is in respect to those matters set out in paragraphs (a) to (c), which deal with what are commonly known as the “contribution” factors. Contributions can, in turn, be direct or indirect, financial or non‑financial contributions to the matrimonial property. The second limb is in respect to those matters set out in paragraphs (d) to (g), which primarily relate to the future needs of the parties but can include any fact or circumstance which, in the opinion of the Court, the justice of the case requires to be taken into account.
The broad discretion conferred by s 79 of the Act is not, however, to be exercised “according to an unguided judicial discretion”.[6] The case of Hickey and Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143 at 78,386 [39] (“Hickey”), provided useful guidance recommending that, in determining what orders are appropriate, just and equitable the preferred approach is to adhere to the following four steps:
(1)Identify and determine the asset pool of the parties as at the date of the hearing (this necessarily involves identifying both the assets and liabilities).
(2)Identify and determine each of the parties’ financial and other contributions to the date of the hearing (this can include the financial contributions made before, during and after the marriage).
(3)Assess how future and other events may have a financial impact on either of the parties, such as their age, state of health, income and property or financial resources (known as the s 75(2) factors).
(4)Step back and examine this formula-based reasoning against the history of the marriage, intangible considerations and other contingencies so as to consider whether the outcome represents a just and equitable result.
[6] Stanford v Stanford (2012) 247 CLR 108 at 120 [38] per French CJ, Hayne, Kiefel and Bell JJ (“Stanford”).
In undertaking the recognised second step of weighing the parties’ respective contributions,[7] I am required to take into consideration all of the myriad of contributions, including both parties’ initial contributions, in a holistic fashion.[8] That is, in the exercise of discretion under s 79 of the Act, the Court is required to “weigh and assess the contributions of all kinds and from all sources made by each of the parties throughout the period of their cohabitation”.[9] Given their differing natures, it is not possible to assess contributions with mathematical precision so as to allow them to be weighed neatly against one another.[10] In reality the “task is like comparing apples and oranges”.[11] All contributions must be weighed collectively rather than segmented or compartmentalised and weigh one against the remainder[12] with the Court charged with moving from a quantitative to a qualitive assessment.[13]
[7] Bevan v Bevan (2013) FLC 93-545 at 87,230 [60] – 87,232 [71] per Bryant CJ, Finn and Thackray JJ; Schaars & Schaars [2023] FedCFamC1F 12 at [21] per Altobelli J.
[8] Dickons v Dickons (2012) 50 Fam LR 244 at 250 [24], [26] and see also Jabour & Jabour (2019) FLC 93-898 at 78,941 [86] (“Jabour”).
[9] Jabour (2019) FLC 93-898 at 78,937 [60].
[10] Norbis v Norbis (1986) 161 CLR 513 at 522 per Mason and Deane JJ; Clives v Clives (2008) FLC 93-385 at 82,936 [41], [44] – [45].
[11] Franklin v Franklin [2010] FamCAFC 131 at [177] per Boland and Thackray JJ.
[12] Jabour (2019) FLC 93-898 at 78,940 [73] – 78,941 [87]; Horrigan & Horrigan [2020] FamCAFC 25 at [42]‑[48].
[13] Mallet v Mallet (1984) 156 CLR 605 at 625 per Mason J; Teal v Teal [2010] FamCAFC 120 at [36] per Boland and Dawe JJ; Van der Linden v Kordell [2010] FamCAFC 157 at [90] per Coleman, O'Ryan and Strickland JJ.
In undertaking the third step, that is the task of assessing the parties’ future needs, the Full Court has cautioned against a tendency “to assess s 75(2) factors in percentage terms without considering its real impact” and that it “is the real impact in money terms which is ultimately the critical issue”.[14]
[14] Clauson and Clauson (1995) FLC 92–595 at 81,911 and see Trevi and Trevi (Re-Exercise) [2019] FamCAFC 51 at [48].
In undertaking the fourth stage, referred to in Hickey, it has been said that what is a just and equitable outcome does “not admit of exhaustive definition”, nor is it “possible to chart its metes and bounds”.[15] It is important to recognise that “the whole is not necessarily the sum of its component parts, and at the very least one has to stand back, at the end, and look at the final result, to ensure that the cumulative process has not produced a manifestly unjust result”.[16]
[15] Stanford 247 CLR 108 at 120 [36] per French CJ, Hayne, Kiefel and Bell JJ.
[16] Stanford 247 CLR 108 at 114.
It is to be appreciated that the exercise of the broad discretion given to the Court pursuant to s 79 of the Act “‘inevitably involves value judgements and matters of impression’, and accordingly it cannot be treated as ‘a mathematical exercise’”.[17]
[17] Petruski & Balewa (2013) 49 Fam LR 116 at 127 [49] (“Petruski & Balewa”).
IS IT JUST AND EQUITABLE TO MAKE A PROPERTY ADJUSTMENT?
The parties:
(1)Jointly own three real properties in Australia.
(2)Jointly own a real property in the United Kingdom.
(3)Are the joint shareholders of a company based in the United Kingdom that owns four real properties in that country, two vehicles and vehicle storage in Country V.
They agree that they want their respective property interests adjusted to sever their financial ties to each other.
I am satisfied that it is just and equitable to adjust their property interests. I have taken into account the findings set out below in arriving at that conclusion.
THE BALANCE SHEET
The Husband attached a balance sheet to his Case Outline Document. As the Wife did not file a Case Outline, or a balance sheet, I went through the Husband’s balance sheet with her at the start of the trial.
That process identified the following points of difference:
(1)The Wife disagreed with each of the “add backs” contended for by the Husband.
(2)The Wife raised a query about an additional policy of superannuation. That query was disposed of by an answer from the Husband’s Counsel which was accepted by the Wife.
(3)The Wife raised a question about bank accounts with W Bank, which was also disposed of with an answer from the Husband’s Counsel that was accepted by the Wife.
At the time of submissions, the Wife expressed some doubts about the value of Motor Vehicle 3 and Motor Vehicle 4 in the United Kingdom, and about the balances of some of her personal bank accounts. Given that the Wife filed no evidence, has failed to make disclosure after May 2023, did not object to those values at the start of the trial and did not challenge the Husband’s evidence about such things, I will accept the values set out in the balance sheet produced by the Husband for those items.
The Wife wanted to cross-examine the single valuer of the Suburb F Property.
In the course of that cross-examination, it emerged from the questions that she asked that the Wife had communicated directly with that expert, and had failed to copy that communication to the Husband’s legal representatives.
Cross-examination of the expert was stopped at that point and I directed the Wife to file an affidavit overnight deposing to all communication that she had had with that expert. She didn’t do so.
I accept that the value of the Suburb F Property is as per the single expert’s opinion expressed in his report.
Addbacks
In Omacini and Omacini (2005) FLC 93-218 at 79,617 [30] the Full Court identified three categories where it may be appropriate to notionally add back an item of expenditure, as follows:
(a) Where the parties have expended money on legal fees: DJM v JLM (1998) FLC 92-816 at 85,262.
(b) Where there has been a premature distribution of matrimonial assets: Townsend & Townsend (1995) FLC 92-569 at 81,654.
(c) In the circumstances outlined by Baker J in Kowaliw & Kowaliw (1981) FLC 91-092 at 76,644:
(a) “Where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets”, or
(b) “Where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value”.
The Husband identifies four items that he says should be regarded as “add backs” and treated as assets in the hands of the Wife:
(1)A sum of $17,400 that the Wife accepted in cross-examination was used to pay X Lawyers and a barrister by the name of Mr Y.
(2)A further sum of $100,932 paid by the Wife to Z Pty Ltd.
(3)Payments by the Wife to MM Lawyers of $11,918.
(4)Funds transferred by the Wife from a joint bank account to her personal bank account on various dates and in various amounts, totalling $269,904.
It emerged from the cross-examination of both parties that it is not in dispute that a third party accused the Wife of assaulting him. That resulted in a complaint by that third party to the New South Wales Police Force (“NSW Police”), who charged the Wife with assault.
The NSW Police charges were ultimately dropped. However, the third party initiated a civil claim for damages against the Wife.
It is not challenged that the first and third “add back” items relate to legal fees incurred in the defence of the criminal charges and/or the consequent civil proceedings.
Nor is it challenged that the second item is the lump sum payment made to the third party who accused the Wife of assaulting him.
It is common ground that the Husband was present at Court with the Wife and her legal representatives on the day that the civil proceedings were compromised by way of an agreed payment to the third party.
There is disagreement between the parties about whether or not the Husband agreed to draw down sufficient funds to pay the third party himself from Superannuation Fund 1 in the United Kingdom.
There was no suggestion put to the Wife that the criminal complaint against her, the consequent civil proceedings or the compromise of those proceedings was wanton, reckless or negligent. Nor was it suggested to her that in defending the proceedings, the Wife had embarked upon a course of conduct intended to reduce the assets available to herself and the Husband.
She has not benefited to the detriment of the Husband from the payment of her lawyers in those proceedings, nor from the payment to the civil plaintiff, apart from the obvious benefit of having those proceedings come to an end.
There is an obvious difference between a party using what would otherwise be joint funds to pay their legal fees in the matrimonial proceedings concerning the adjustment of those very funds on the one hand, versus the payment of legal fees for the purpose of defending the proceedings that I have described above.
I am not persuaded that any of the first three items ought to be treated as an “add-back” in the way contended for by the Husband.
The quantum of the fourth item represents, in my view, a combination of frustration by the Husband at what he says is a failure by the Wife to meet her disclosure obligations in these proceedings, and a forensic exercise on his part consisting of adding up all of the transfers from a joint account to the Wife’s personal account that he says are unexplained. The Husband’s evidence is set out at paragraphs 46 to 48, and also at paragraphs 63 to 68 of his affidavit.
The Husband’s solicitors wrote to the Wife on 30 January 2023 (Exhibit 6), 23 March 2023 (Exhibit 2), 12 May 2023 (Exhibit 3), 11 August 2023 (Exhibit 4), 14 August 2024 (Exhibit 10), 17 August 2023 (Exhibit 7), 25 June 2024 (Exhibit 8), 16 September 2024 (Exhibit 5). Some of those letters contained notice to the Wife that documents had been uploaded to the shared Dropbox by way of disclosure by the Husband. All of those letters asked the Wife for more disclosure, often with quite specific requests by reference to bank accounts and dates, etc.
The Wife was cross-examined in relation to her non-disclosure. In the course of that cross‑examination, she was taken to Exhibit 5, which is a letter sent to the Wife by the Husband’s solicitors on 16 September 2024. That letter sets out with specificity the disclosure from the Wife that was outstanding at that time. In addition to that, under the heading “Further Particulars” the Wife was asked to provide an explanation for a list of transactions. The account that the funds were withdrawn from was identified, as was the date and amount of each transaction that was the subject of enquiry.
That list of transactions informs the four items that the Husband contends for as add-backs.
The Wife did not respond to that request.
The single greatest transfer of funds was an amount of $95,000 on 6 March 2024 that the Wife says were the funds that were ultimately paid to the third party that sued her. Notwithstanding the Wife’s failings in relation to disclosure, I accept that evidence.
In relation to the add back item four, that leaves approximately $169,000 transferred and used by the Wife since separation in 2021/2022.
The Wife’s oral evidence, when questioned, was that the funds in question were used to meet the expenses associated with the investment properties in the United Kingdom, expenses in relation to two of the Australian based properties and, general living expenses.
She was challenged on that, however, I accept her evidence that the funds expended were for the reasons that she gave.
The Husband’s complaint is that:
(1)He has been paying an amount of $8,000 per month from his own financial resources into the joint account; and
(2)The Wife’s failure to make proper disclosure should persuade the Court to assume that the Wife has made use of the funds in such a way that an “add-back” is justified.
Whilst the Court does not have to be unduly cautious about making robust assumptions when a party fails to make disclosure, on this occasion I am not persuaded that an add-back is justified.
The issue of the Wife’s non-disclosure is concerning. The Husband’s solicitor created a shared “Drop-Box” for the purposes of the parties making disclosure to each other in electronic form.
The Wife was cross-examined on Exhibit 9, which is a schedule that the Husband’s solicitor was able to obtain from the shared Dropbox identifying the dates that the parties uploaded documents by way of disclosure to each other in these proceedings. The document on the face of it shows that the Wife did not upload any documents to the shared Dropbox after 5 May 2023.
The Wife does not concede that she has not made any disclosure after 5 May 2023, however she has produced no evidence to show that she did so. That is despite the letter sent to her by the Husband’s solicitors which is now Exhibit 5.
I am satisfied that the Wife failed to make any disclosure by way of adding documents to that Drop-Box after 5 May 2023.
I accept that the Wife has failed to make disclosure of bank statements that should have been disclosed. She has also failed to answer straightforward questions put to her about the relevant transactions in correspondence from the Husband’s solicitors. She should have done both of those things. Doing so may very well have narrowed the issues that had to be dealt with at trial.
However, I am also satisfied that the Husband had knowledge of both the criminal charges and the civil proceedings. It is common ground that he was present at Court with the Wife when the compromise of the civil proceedings was agreed, and that he was involved in the settlement discussions. I conclude that he had sufficient knowledge to know that the transfer of funds, in more or less the same amount as the agreed compromise, and on the same date that the compromise was struck, was likely to have been for that purpose.
I am not persuaded that there is anything wanton, reckless or negligent about any of the funds that I have referred to as the fourth item. Nor am I persuaded that there is any other reason why those funds should attract the exception to the general rule and be treated as an add-back as contended for by the Husband.
Two Pools
It is usual for the Court to consider the property of the parties as an overall pool. It is, however, open to the Court to undertake the considerations with respect to individual items of property (see Norbis v Norbis (1986) 161 CLR 513).
The Husband’s mother passed away in mid-2023, well after the date of separation.
The Husband has inherited a property at Suburb AA, a motor vehicle and cash. The total of what has been inherited amounts to $8,014,725.
Ordinarily, an inheritance in those circumstances is treated as a contribution made on behalf of the party who inherited (see In the Marriage of Bonnici (1991) FLC 92-272; Calvin and McTier (2017) FLC 93-785). There is no affidavit evidence from the Wife before the Court to challenge the usual approach in relation to the Husband’s inheritance.
I am persuaded that the contribution considerations in relation to the assets inherited by the Husband are sufficiently different to the contribution considerations in relation to the rest of the relevant assets and liabilities that it justifies having those inherited assets treated as a separate pool.
The Final Balance Sheet
As a consequence of my findings referred to above, the final balance sheet is as follows:
Ownership Description Value ($) Assets 1 Joint J Street, Suburb K(£720,000) 1,392,479 2 Joint C Street, Suburb D NSW 1,120,000 3 Joint E Street, Suburb F NSW 2,000,000 4 Joint G Street, Suburb H 1,900,000 5 Joint ANZ Account Ending …82 1,310 6 Husband Motor Vehicle 1 18,800 7 Joint Q Bank account …76 (-£4,867.24) (9,533) 8 Joint Loan to Mr R 90,000 9 Joint N Ltd (see below): 9.1 1 CC Street, Suburb DD, City EE (£325,000) 628,546 9.2 2 CC Street, Suburb DD, City EE (£550,000) 1,063,681 9.3 FF Street, Suburb GG, City EE, UK, (£560,000) 1,082,956 9.4 HH Street, Suburb JJ (£340,000) 657,573 9.5 Vehicle 6 232,640 9.6 Vehicle 7 249,255 9.7 Vehicle storage in Country V 149,000 9.8 P Bank Account …41 (£0) - Total 4,063,651 10 Husband Motor Vehicle 2 40,000 11 Wife Motor Vehicle 3 (£36,950) 71,880 12 Wife Motor Vehicle 4 (£19.990) 38,918 13 Husband ANZ Bank Account Ending …56 5,717 14 Wife ANZ Bank Account Ending …85 2,332 15 Wife ANZ Bank Account Ending …93 430 16 Wife P Bank Account …09 (£27,928.08) 54,662 Total 10,790,646 Liabilities 17 Joint ANZ Mortgage Account Ending …42 (Suburb D) 43,200 18 Joint ANZ Mortgage Account Ending …22 (Suburb H) 212,988 19 Joint ANZ Mortgage Account Ending …55 458,745 20 Joint ANZ Mortgage Account Ending …09 111,218 21 Joint ANZ Mortgage Account Ending …25 81,110 22 Joint L Bank Mortgage (£82374) (J Street) 159,158 23 Joint M Bank Standard Variable Loan …00 (Suburb F) 121,284 24 Joint M Bank Standard Variable Loan …97 (Suburb F) 45,729 25 Joint M Bank Standard Variable Loan …86 (Suburb F) 94,890 26 Joint M Bank Standard Variable Loan …89 (Suburb F) 30,568 27 Joint M Bank Standard Variable Loan …78 (Suburb F) 44,565 28 Joint N Ltd (see below): 28.1 KK Finance Mortgage Account …05 (£12,931.62) + …57 (£34,830.79) (FF Street) 93,459 28.2 KK Finance Mortgage Account …06 (£12,759.56) + …56 (£35,897.42) (2 CC Street) 91,194 28.3 KK Finance Mortgage Account …55 (£27,756.52) (1 CC Street) 54,333 28.4 KK Finance Mortgage Account …17 (£19,658.49) (HH Street) 38,481 28.5 P Bank Account. Term Loan- Account …93 (£11,275.11) 21,927 28.6 P Bank credit card …55 (£736.33) 1,431 Total: 300,825 29 Husband P Bank credit card …34 (£8.99) 17 30 Wife ANZ Low Rate CC …79 4,938 31 Wife P Bank credit card …53 (£727.34) 1,414 32 Wife LL Company ending …07 2 Total 1,710,651 Superannuation 33 Husband Superannuation Fund 1 (£167,000) 326,900 34 Husband Superannuation Fund 2 (£18,651) 36,509 35 Husband Superannuation Fund 3 13,338 Total 376,747 Net Assets Assets 10,790,646 Superannuation 376,747 Subtotal (Assets and Superannuation) 11,167,393 Liabilities - 1,710,651 Total 9,456,742
Separate Pool - Inheritance 36 Motor Vehicle 5 64,725 37 BB Street, Suburb AA 4,750,000 38 Mother’s SMSF distribution 2,450,000 39 Mother’s personal estate 750,000 Total 8,014,725 CONTRIBUTIONS
The Court is required to make an assessment of the nature and quality of the totality of the parties’ contributions throughout the entirety of their relationship, together with their contributions in the period subsequent to their separation: Dickons & Dickons (2012) 50 Fam LR 244 at [14], [29] per Bryant CJ, Faulks DCJ, Murphy J (“Dickons”); Jabour (2019) FLC 93-898 at 78,937 [61] per Alstergren CJ, Ryan and Aldridge JJ. See also Dovgan & Dovgan [2021] FamCA 306 at [347] per Harper J, which restates the need to holistically assess contributions following the case of Dickons, and that “all contributions must be weighed collectively and so it is an error to segment or compartmentalise the various contributions and weigh one against the remainder”.
Authorities establish that financial contributions are neither less nor more valuable than non‑financial contributions: In the Marriage of Rolfe (1977) FLC 90-629 at 78,272 – 78,273 per Evatt CJ; In the Marriage of Ferraro (1992) FLC 92-335 per Fogarty, Murray and Baker JJ; In the Marriage of Waters & Jurek (1995) FLC 92-635 at 82,379 per Fogarty J; Fields v Smith (2015) FLC 93-638 at 80,127 [43] per Bryant CJ and Ainslie-Wallace J; Trask & Westlake (2015) FLC 93-662 at 80,386 [14] – [15] per Thackray, Ryan and Murphy JJ.
Initial contributions
The Husband’s affidavit evidence says, in summary, that each of the parties had very modest assets at the commencement of the relationship (at paragraphs 23 to 25).
That evidence is unchallenged and I accept it.
Contributions during the course of the parties’ relationship
The Husband’s affidavit evidence in relation to the parties’ respective contributions throughout the relationship is set out at paragraphs 26 to 57 of his affidavit.
That evidence is also largely unchallenged.
In summary the Husband says that:
(1)While the parties lived in the United Kingdom, the Wife was self-employed as a consultant and earned considerably more than he did.
(2)The parties had joint bank accounts where they pooled their respective incomes and from which they met their joint expenses.
(3)The parties jointly purchased various property in Australia.
(4)The parties advanced funds to the Wife’s brother to facilitate the purchase of a property by him. The funds advanced were secured by a loan agreement and a mortgage. The Wife’s brother has defaulted on repayments and the Husband complains that the Wife has not pursued the debt.
(5)The parties established a company in the United Kingdom, “N Ltd”. They were joint shareholders and directors. The Company purchased various investment properties, two vehicles and vehicle storage. There are debts in the name of the Company, that relate to the purchase of those various assets.
(6)The Wife was primarily responsible for maintaining the joint bank accounts. This appears to have arisen as a consequence of the Husband’s alcoholism, an affliction that he suffered from up until around 2000.
(7)The Wife was also solely responsible for managing the tenancy arrangement for the various relevant properties.
(8)The Husband has been sober since 2000. Whilst he was in a rehabilitation facility, he says that the Wife assumed sole control of the parties’ jointly owned assets, and excluded him from access to the parties’ various joint bank accounts.
(9)The parties made a joint decision to relocate permanently to Australia at some time in 2015, though he says that the physical move was delayed for a variety of reasons until late 2020.
(10)Though there is some disagreement about what was agreed and when, it seems that between October 2020 and the time of trial, the Wife has lived between the United Kingdom and Australia.
(11)The Husband says that he retired in 2015, however interrupted retirement to work for a company in Australia as a professional between early 2022 and early 2023.
(12)The Wife retired from her occupation in 2014.
Post separation contributions
It is not challenged that the Husband has deposited approximately $8,000 per month from his personal ANZ account into the parties’ joint account for the purpose of assisting with joint expenses associated with the various properties, but also to assist with the Wife’s living expenses.
It is also not challenged that the Wife has had the ability post separation to occupy both the Suburb F and Suburb D properties, to the exclusion of the Husband. The Husband complains that the Suburb F Property could have been rented out to generate income during that period.
As mentioned above, the Husband’s mother passed away in 2023, after the Husband and Wife had separated.
Assessment of Contributions
In relation to the “Non-Inheritance Pool”, having regard to the myriad of contributions that both parties have made, in differing forms, over a relationship of approximately 38 years, I have arrived at the conclusion that those contributions ought be assessed as being equal.
The “Inheritance Pool” represents a contribution made effectively on behalf of the Husband solely, for the reasons set out in authorities such as In the Marriage of Bonnici (1991) FLC 92‑272 and Calvin and McTier (2017) FLC 93-785. There is no evidence advanced by the Wife that would persuade the Court to deviate from the usual conclusions in that regard.
THE FACTORS REFERRED TO IN S 75(2)
The Husband is 66 years old. He describes his health as reasonable.
The Wife is 63 years old. In cross-examination, the Husband conceded that:
·The Wife has been on a waiting list for surgery in the United Kingdom for years.
·The Wife has pain in two parts of her body, and she has suffered from that pain for years.
The Husband deposes to the Wife’s state of health at paragraphs 84 and 85 of his affidavit. He says that:
·She is retired.
·She has had health problems throughout the relationship.
·She oversees the rental properties in Australia and in the United Kingdom.
The Husband is retired. Counsel for the Husband submitted that he will live off his inheritance, after paying out the various loans that he proposes to pay out as a part of the orders that he seeks in these proceedings.
There are no children of this marriage, nor does either party depose to a responsibility to support any other person.
The Wife suggested that the Superannuation Fund 1 superannuation account in the Husband’s name is in payment phase. The Husband said in cross-examination that if it is, he wasn’t aware of it, and that he hasn’t been receiving any payments from it. He will retain that policy pursuant to the Orders that I am going to make and it has been taken into account as an asset in the balance sheet. The questions put to the Husband in cross-examination suggest that if it is in payment phase, the payments are modest.
The Husband will receive the Australian based properties. They have not been tenanted for some time. The Husband says, at paragraph 43 of his affidavit, that the Suburb F Property could be rented out for $3,200 per month. There is no evidence of the rental income that could be derived from the Suburb D Property.
The Wife will retain the jointly owned United Kingdom property, and the company, which owns four properties, two vehicles and vehicle storage.
The Wife produced, in response to a call by the Husband, copies of the tenancy agreements for the four properties owned by the company. The four properties currently generate a combined monthly income of GBP£7,115. Using the conversion rate applied by the Husband in the balance sheet, that is approximately AUD$13,760 per month.
The Husband has re-partnered, however, there is no evidence that he cohabits with his new partner, nor of the financial circumstances of that relationship.
The Wife has not re-partnered. She said that it is her intention to continue to live between Australia and the United Kingdom.
In relation to s 75(2)(o), I take into account that the Husband will retain the Inheritance Pool. That provides to him a home worth $4,750,000 and cash resources worth approximately $3,150,000, less whatever it takes to pay out the various loans that he proposes to pay out.
Evaluation of s 75(2) factors
Having regard to the matters arising out of s 75(2) that I have mentioned above, I am persuaded that an adjustment in favour of the Wife is appropriate.
The Non-Inheritance Pool has a net value of $9,456,742.
If the Wife were to receive 60% of that pool, that would mean that she will receive property with a net value of $5,674,045 and the Husband will receive property with a net value of $3,782,696.
The difference in those two outcomes, $1,891,349 appropriately addresses:
·What the Husband has in the form of his inheritance.
·The income that the Wife will be able to generate from the United Kingdom based properties.
·Despite the fact that the exact quantum is unknown, the income that the Husband will be able to generate for himself from the Australian based properties.
AN ADJUSTMENT THAT IS JUST AND EQUITABLE
Vehicle 6
The Husband indicated that he wants Vehicle 6, which is owned by the Company. The Wife opposes that.
There is no evidence before me of any financial consequence of transferring a company asset to one of the parties. The Company is not a party to the proceedings.
The Husband advanced no reason why he should obtain Vehicle 6 other than his personal wish to do so.
The Wife suggested that there were some practical reasons why she would like to keep that vehicle, as opposed to Vehicle 7, which is presently stored in Country V. The storage in the United Kingdom makes it easier to utilise Vehicle 6. The Husband agreed with that.
In any event, I am cautious about causing the parties to transfer an asset of a company based in the United Kingdom to one of them personally in the absence of any evidence of any financial or regulatory consequence of doing so.
The Suburb F Property
The Wife indicated that she wants to retain the Suburb F Property. The Husband opposes that.
The Wife says that she intends to continue to live between the United Kingdom and Australia, and that she would like a residence in both countries for that reason.
The problem, in my view, with that wish is that the Suburb F Property is assessed by the expert to be worth $2,000,000.
Retention of the Suburb F Property by the Wife would require the payment of cash to the Husband to achieve the percentage outcome that I have determined to be just and equitable. The Wife has no evidence of any borrowing capacity or other sources of funds, so that outcome would logically require the sale of a property owned by the Company.
As I have said above, there is no evidence before the Court of the financial or regulatory consequences of transferring a company asset to one of the parties, nor is there any evidence of the consequence of selling a company asset in order to generate funds to enable one party to meet a personal obligation to pay funds to the other.
I understand the Wife’s wish is to have an Australian based property to live in when she is here. However, she will have to make decisions about the assets that she receives as a consequence of these Orders if she wishes to acquire one.
The Loan to the Wife’s Brother
In the orders set out in his Case Outline, the Husband sought to take over responsibility for collecting the loan owed to the parties by the Wife’s brother, Mr R.
The Wife opposed that.
In the orders sought by the Husband at the time of submissions, reflected in Exhibit 11, he acquiesced to the Wife’s wishes in that regard.
The Husband said at paragraph 40 of his affidavit that the loan to the Wife’s brother was made from savings. However, both parties asked questions and made submissions that were based on one or more of the M Bank mortgages relating to that debt.
The Wife said that the M Bank debt ending in “…00” relates to her brother.
In the revised draft orders submitted by the Husband at the time of submissions, he said that the M Bank mortgages “…97” and “…78” were to be taken by the Wife. That was said on his behalf in the context of the Wife receiving the debt owed to the parties by the Wife’s brother, and her assuming responsibility for the related debts that were owed by the parties.
The brother owes the parties $90,000. The two M Bank debts identified by the Husband have a combined total of $90,294.
For all of the reasons that I have identified above, I am more confident in the Husband’s evidence and knowledge of such things than I am in the Wife’s.
I will order that the Wife has the benefit of the debt owed by her brother, and has the burden of the two M Bank debts identified by the Husband.
Sale of the Suburb K Property
In the orders annexed to his Case Outline, the Husband contended for the Wife to retain the jointly owned property at Suburb K in the United Kingdom.
In the orders set out in Exhibit 11, the Husband’s position changed, and he contended for the sale of that property.
Counsel for the Husband clarified that change in position was to accommodate the change in the Husband’s position regarding the division of the Non-Inheritance Pool.
I have concluded that the Wife should get a larger portion of the Non-Inheritance Pool than the Husband, and consequently it is not necessary to cause the Suburb K Property to be sold.
The Orders
Having regard to my findings in relation to the pool of assets and liabilities:
·The Inheritance Pool has a value of $8,014,725; and
·The Non-Inheritance Pool has a net value of $9,456,742.
The Husband set out orders sought by him in his Case Outline, however he revised the orders that he sought by the time of submissions. The revised orders sought, and a revised balance sheet are Exhibit 11.
According to Exhibit 11, the Husband seeks orders that he refinance the following liabilities into his sole name:
·M Bank …89.
·M Bank …00.
·M Bank 2…86.
·ANZ …42.
·ANZ …25.
·ANZ …22.
·ANZ …55.
·ANZ …09.
On the Husband’s proposed orders, the Wife would then have to refinance the following debts into her sole name:
·M Bank …97.
·M Bank …78.
If the Wife retains:
·The Suburb K Property worth $1,392,479;
·The assets of N Pty Ltd, with the Husband to pay out the debts of that company, leaving assets worth $4,063,651;
·Bank accounts and investments otherwise standing in her name or control worth $57,424;
·Motor vehicles located in the UK including the Motor Vehicle 2, Motor Vehicle 3 and Motor Vehicle 4, worth $150,798;
·The debt owed by her brother Mr R $90,000;
·Any other item of personalty in her possession or control or financial resource;
·Her credit card debts of ($6,354)
·The two M Bank debts relating to the Mr R loan – ($90,294)
then that means that she will have net assets worth $5,657,704 which is $16,341 short of 60% of the Non-Inheritance pool.
However, as I have identified above, the Wife owes to the Husband a total of $17,920.37 for Costs Orders made in the Husband’s favour on 2 November 2023 and 27 June 2024. I will order the Husband to pay the Wife the sum of $16,341, however I will provide for that sum to be offset against any sum owing by the Wife to the Husband as a consequence of any Costs Orders made in the course of these proceedings that have not been paid.
The Wife, on that outcome, will have a home in the United Kingdom, as well as the sole control and ownership of the Company, which owns assets worth $4,063,651. Those assets generate the equivalent of a little over AUD$13,000 per month in gross income for the Company.
The Husband, on that outcome, will have net assets from the Non-Inheritance Pool worth $3,798,744. He will retain the inheritance pool worth $8,014,725.
I recognise that the Husband will probably have to apply some of the cash in the Inheritance Pool to pay out or refinance the debts that he takes over as a part of the division of the Non‑Inheritance Pool. However, he will also have the ability to derive income from the rental of the various Australian properties.
I am satisfied that those outcomes are just and equitable as between the Husband and the Wife.
I certify that the preceding one hundred and eighty-two (182) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Shoebridge. Associate:
Dated: 8 November 2024
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