LYON & LYON
[2011] FamCA 268
•18 April 2011
FAMILY COURT OF AUSTRALIA
| LYON & LYON | [2011] FamCA 268 | |||
| FAMILY LAW – PROPERTY SETTLEMENT – Where the wife has been financially independent of the husband during marriage and since separation – Where the child of the marriage has special needs – Where the wife has been the primary care giver – Where the wife has contributed the greater share to medical expenses – Husband has made a minimal contribution to child support – Where wife resides interstate – The wife has borne the bulk of the child’s travel costs – Property to be divided 85 per cent/15 per cent in favour of the wife – Wife to retain the former matrimonial home | ||||
| APPLICANT: | Ms Lyon | |||
| RESPONDENT: | Mr Lyon |
| INDEPENDENT CHILDREN’S LAWYER: | Ms Duncan, Solicitor |
PROPERTY SETTLEMENT PROCEEDINGS
| FILE NUMBER: | BRC | 11115 | of | 2008 |
| DATE DELIVERED: | 18 April 2011 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Barry J |
| HEARING DATE: | 1 September 2010 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | The Applicant Wife appearing in person |
| COUNSEL FOR THE RESPONDENT: | Mr Hamwood of Counsel appearing for the Respondent Husband |
| SOLICITORS FOR THE RESPONDENT: | Madden Solicitors |
| COUNSEL FOR THE INDEPENDENT CHILDREN’S LAWYER: | Mr Selfridge of Counsel appearing for the Independent Children’s Lawyer |
| SOLICITORS FOR THE INDEPENDENT CHILDREN’S LAWYER: | Ms Duncan, Solicitor of Legal Aid Queensland |
Orders
IT IS ORDERED THAT:
Within ninety (90) days of the date hereof or such further time as the parties may agree or as may be ordered by this Court, the Wife is to pay to the Husband the sum of $25,152.
In the event the Wife fails to pay the sum of $25,152 within the specified time, or such further time as the parties may mutually agree in writing, or as may be further ordered by the Court, the property at … in Brisbane Suburb 1 is to be sold.
For the purposes of sale as provided for in paragraph (2), a real estate agent is to be appointed to sell the property by private treaty. A real estate agent is to be mutually agreed to in writing between the parties, or failing agreement, a real estate agent recommended by the President of the REIQ is to be appointed.
Reserve price is to be set at a price agreed to by the Husband and Wife or failing such agreement, at a price equivalent to the mean of two (2) valuations by registered valuers being members of the Australian Institute of Valuers, one obtained by and at the expense of the Husband and one obtained by and at the expense of the Wife, such valuations to be made within two (2) weeks of each other.
In the event the property is not sold by private treaty within ninety (90) days of default by the Wife in making this payment pursuant to the terms of paragraph (1) hereof, the Husband and Wife are to forthwith do all acts and things necessary for the sale of the property by public auction and in particular are to:
a)place the property with the auctioneer, to be agreed to and failing agreement as specified by the President of the REIQ or his or her nominee for sale by public auction at the earliest possible date; and
b)execute all documents requested by the auctioneer for the sale of said property.
The parties must do all acts and execute all documents to cause the proceeds of sale of the property to be used as follows:
a)to pay the reasonable expenses of the sale including agent’s commission, legal costs and disbursements;
b)to discharge the mortgage to Commonwealth Bank of Australia secured on the property;
c)to pay rate adjustments other than those amounts otherwise payable by one of the parties pursuant to these Orders;
d)to pay to the Husband the sum of $25,152, together with any interest which has accumulated from the date upon which he was entitled to receive the moneys pursuant to these Orders; and
e)the balance of proceeds to the Wife.
Until the payment of moneys as provided for by these Orders, the Wife must indemnify the Husband against any liability for outgoings in respect of the Brisbane Suburb 1 property and any liability in respect of any mortgage or charge thereon.
Except as otherwise provided for in these Orders, each party is to stand possessed of the items in their respective possession at the current time.
Except as otherwise provided for in these Orders, each party is declared to have no further interest in the items of property in the possession of the other.
If either party does not execute all deeds and instruments to give effect to the making of these Orders within the specified time, or such further time as the parties may mutually agree in writing, or as may be further ordered by the Court of being so requested, then a Registrar of this Honourable Court at Brisbane is hereby appointed pursuant to s 106A of the Family Law Act 1975 to execute all deeds and instruments on behalf of the defaulting party.
IT IS NOTED that publication of this judgment under the pseudonym Lyon and Lyon is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| FAMILY COURT OF AUSTRALIA AT BRISBANE |
FILE NUMBER: BRC11115/2008
| Ms Lyon |
Applicant
And
| Mr Lyon |
Respondent
REASONS FOR JUDGMENT
This matter was originally listed for a two day trial for both children’s issues and property settlement. The children’s issues were complicated by the subject child’s special medical needs as well as the Wife’s unilateral relocation from South East Queensland to Adelaide. The property pool is a relatively modest one and in the ordinary course would have been dealt with in the Federal Magistrates Court. It was as a result of the complications in the determination of the children’s issues that the matter was to be heard in this jurisdiction.
At the commencement of the hearing I was informed the parties had resolved the children’s issues by way of consent orders which, in summary form, provided:
·The child X, born April 2001 reside with his mother in Adelaide.
·An order for equal shared parental responsibility.
·The Father have up to two mid-term visits in Adelaide from after school Thursday to before school Tuesday.
·In a two year cycle the Father spend time with the child on the following basis:
in odd numbered years:
a) the whole of the Easter holiday period;
b) for the last ten days of the September school holiday period;
c) for the second half of the Christmas school holiday periods;
and in even numbered years for the:
d) whole of the June school holiday period;
e) the last ten days of the September school holiday period; and
f) for the first half of the Christmas school holiday period.
For each visit with the Father, the Mother was to be responsible for the cost of transporting the child between Adelaide and Brisbane and return and the Father was to be responsible for transporting the child from Brisbane to his residence (currently Town 1 in Queensland).
Property Settlement
It remains for me to determine property settlement issues as between the parties.
The Husband was born in 1962 and the Wife in 1964. They met in Brisbane in 1992.
The Husband at that stage had been previously married and divorced. There were no children of that relationship. That property settlement involved his then wife receiving 50 per cent of the net assets.
It is common ground, some time in 1994, the parties commenced cohabitation by residing with the Husband’s parents (refer Wife’s affidavit filed 8 December 2008 at paragraph 8 and the Husband’s affidavit filed 18 August 2010 at paragraph 62).
The parties married in 1997 and the child X was born in April 2001. The parties separated in September 2005 when the Wife left the parties’ residence in Town 2 and relocated with the child to Brisbane (refer Wife’s affidavit filed 8 December 2008 at paragraph 9).
Orders Sought
The Wife seeks orders in the following terms (refer case information document filed 24 August 2010) (in summary form):
·the Wife retain to the exclusion of the Husband the Brisbane Suburb 1 property;
·the Wife retain her Mazda vehicle, household goods and chattels in her possession;
·her entitlements in her superannuation fund – S Superannuation, C Superannuation, H Superannuation and B Superannuation;
·funds held to her credit in any bank account;
·the Wife be responsible for and indemnify the Husband in relation to the mortgage secured over the Brisbane Suburb 1 property;
·the Husband shall retain all of his interest in all household goods and chattels in his possession;
·all business and technological equipment pertaining to the tradesman business known as S Pty Ltd in his possession;
·all of his motor vehicles inclusive of but not exhaustive of Honda Motor Bike, Holden Commodore, Aluminium Motorboat, Inflatable Boat and Motor and any or all other motorised and mechanical vehicles in his possession;
·all sailing boats and buoyancy vessels and equipment inclusive of but not exhaustive of Catamarans, Canoes, Kayaks, Fibro boat and any and all other flotation devices in his possession;
·his entitlements to his superannuation fund inclusive of but not limited to D Superannuation, R Superannuation;
·funds held to his credit in any and all bank accounts;
·any funds acquired from the sale of marital assets; and
·the Husband pay the Wife’s costs of and incidental to all Court proceedings.
10. The orders sought by the Husband are set out in draft orders produced by his Counsel at the commencement of the hearing.
11. In relation to the property settlement issues those orders are in the following terms:
·that the former matrimonial home at Brisbane Suburb 1 be listed for sale;
·that on the sale of the property the following debts be paid;
a) mortgage to Commonwealth Bank of Australia;
b) real estate agent’s commission;
·net proceeds to be divided with the Husband receiving 55 per
cent and the balance to the Wife;
·that the Wife retain to the exclusion of the Husband all her right,
title and interest to any property and resources in her name or
possession as at the date of the Order;
· that the Husband retain to the exclusion of the Wife all of his right, title and interest in any property and resources in his name or possession as at the date of the Order including but not limited to:
a) his Honda motor vehicle and his Commodore motor vehicle;
b) household goods and chattels including all business and technological equipment;
c) his boats, motors and all electrical appliances and equipment;
d) his entitlement in his D Superannuation and R Superannuation; and
e) funds held in his credit in any bank account.
12. The orders sought in the document produced by the Husband’s Counsel at the commencement of the hearing differ from the orders as set out in the case information document which had been filed a week earlier. So far as the Husband’s chattel items were concerned at paragraph 17 of the case information document, the orders sought were in the following terms:
·That the Husband shall retain to the exclusion of the Wife all of
his right, title and interest in any property and resources in his name or possession as at the date of this order, including but not limited to the following:
a)household goods and chattels, including all business and technological equipment;
b)his Honda motor vehicle and his Commodore motor vehicle;
c)his Inflatable Boat and Motor;
d)his entitlements in his D superannuation and R Superannuation; and
e) funds held to his credit in any bank accounts.
13. Throughout her evidence the Wife was insistent that the Husband had interests in a range of equipment and boats which he has not otherwise disclosed. There is a suggestion in the Wife’s material that she had been informed that some of the items were held in the name of the Husband’s elderly father.
14. It is puzzling that the Husband seeks orders about boats and motors in the plural where a week earlier he was only seeking an order in relation to an inflatable boat and motor, and his statement of financial circumstances reveals only one inflatable boat and motor. On the evidence available I am unable to resolve this discrepancy.
Initial Contributions
15. In paragraphs 62, 63, 65 to 67 of his trial affidavit filed 18 August 2010 the Husband deposes:
“62. At the time [the wife] and I commenced our relationship I owned:
a. A property at [C Street, Brisbane Suburb 2]. There was a mortgage over this property. I believe that my equity would have been approximately $60,000.
b. A car being a Mazda Utility that was worth about $2,000.
c. My business, [S] Pty Ltd worth about $25,000; and
d. Furniture worth about $5,000.
63.[The wife] owned a motor vehicle and furniture.
65.I bought the [Brisbane Suburb 2] house approximately two years before I met [the wife]. I paid about $80,000 and borrowed about $40,000. I rented it out for the first year and then moved into the house.
66.The house was sold when [the wife] and I moved in together but before we were married. On my recollection on the sale I made about $50,000. This money went to buy a yacht for about $25,000.
67.When we decided to buy another house it was placed in [the wife’s] name only because I had a business and if the business was not successful then the house was protected.”
16. For reasons soon to be given I am sceptical of the claims made by the Husband.
17.
As to the initial contribution by the Wife, the Husband concedes at paragraph 63 of his trial affidavit that she owned a motor vehicle and furniture. Nowhere does the Wife give evidence as to the value of the motor vehicle and the furniture other then in her financial questionnaire which was filed on the
24 August 2010. She says she drove a BMW motor vehicle valued at $20,000 and had furniture and antiques to the value of $25,000. There is no evidence as to what moneys, if any, were owing on the BMW vehicle, nor is there any evidence to confirm the value the Wife has placed on these items.
18. The Wife was working as a director of a small business from the time of the commencement of cohabitation in 1994 (and prior to that date) up until a short period prior to the birth of their child.
19. At paragraph 14 of her trial affidavit the Wife deposes that she was the primary financial contributor to the household. Having regard to the financial statements of the Husband’s business, I would be prepared to infer that that is an accurate statement made by the Wife. In the same paragraph she notes that because she was the primary carer:
“…I was acutely aware of this [being the primary financial contributor to the household] I began saving for my own maternity leave from the moment I found I was pregnant.”
20. The Wife elsewhere deposes to the fact that she had accumulated some $17,000 as at the time the Husband relocated to Town 2 in about February 2002. For the next six months she used these funds to support the child and herself as she was not working. I accept her evidence that in the period from February 2001 until her move to Town 2 in about November 2002, she received no financial assistance from the Husband.
Credibility
21. For reasons which will become apparent in the findings I make throughout this judgment, I prefer the account of events as given by the Wife. By way of an initial example as previously noted, the Husband says his contribution at the time of the commencement of the relationship was his equity in the C Street, Brisbane Suburb 2 property valued at approximately $60,000. Exhibit 7 is a title search of the Brisbane Suburb 2 property which reveals he acquired the property on the 16 January 1992 and its sale was registered on the 25 March 1993, prior to the commencement of cohabitation in 1994. This accords with the Wife’s account of events. The Husband’s assertion that he still retained this property as at the commencement of cohabitation is but one instance why I have found his evidence generally unreliable.
22. At all times throughout the litigation the Husband has been represented by experienced family law practitioners.
23. The Wife was represented by legal practitioners for a period of time but her legal fees were far in excess of the Husband’s and from December 2009 she has not had legal representation. Notwithstanding this fact, it is the Wife who has provided as much detail as possible. In making this observation I am in no way critical of the Husband’s legal representatives. The legal representatives can only disclose documents that have been provided to them by their client.
24. In paragraph 69 of his trial affidavit the Husband when dealing with the sale of the property deposes:
“69.I have made enquiries in relation to bank account statements and I have not been able to obtain any document to support my claim neither have I been able to find details of the purchase of sale [sic].”
25. At transcript page 58, the Husband swore he had not made enquiries from the solicitors used in either conveyance as to the terms upon which he acquired or sold the properties. His evidence is that the first property he owned was sold at the time of the divorce from his first wife. He says he cannot recall who the real estate agents were either when he bought C Street or when he sold it. There is no evidence he carried out a search of the Stamps Office to ascertain stamp duty paid on the purchase or sale on which basis calculations could be made to establish any capital gain. Exhibit 7 reveals a mortgage to a building society (on the photocopy tendered the name of the building society is obscured – the evidence indicates it was Building Society 1). The Husband’s evidence is he made enquiries from the building society, but they were unable to provide the information he sought. I am sceptical that that would be the case. I simply disbelieve the Husband that he could not remember the real estate agents from either the purchase or sale of the C Street property. I am prepared to infer that the reason the Husband is unable to adduce any evidence as to the price at which the property was acquired and/or sold, is that such information would be inconsistent with his sworn evidence in his affidavit material.
26. The Husband’s evidence is the Wife ceased work half way through her pregnancy (the child was born in April 2001).
27. I prefer the Wife’s account which is given with impressive particularity which was not challenged. Her evidence is (paragraph 16 of her trial affidavit):
“16.I worked up to [approximately one month before the birth] until such time as at a weekly regular check (due to the severity of [X’s] complications) it was found that [X’s] health was deteriorating quite rapidly.”
28. The Wife says that the child was due [in late] April 2001 but was born [in early] April 2001 (refer paragraph 23 of her affidavit filed 8 December 2008).
Husband’s Initial Contribution of $25,000 From Value of the Business
29. The Husband commenced a tradesman business in 1990 – S Pty Ltd. Prior to that his evidence is that he had been employed as a tradesman on an income of about $35,000 a year.
30. The business ceased to operate in either late 2001 or early 2002 when the Husband relocated unilaterally to the Town 1/Town 2 district to take up a position as an instructor at the local sports club.
31.
Tax returns have been produced for the business for the years ending
30 June 2000 and 30 June 2001. The figures for the year ending 30 June 1999 are to be found in the earlier return (exhibit 6).
32. The operating profit for each year is as follows:
·30 June 1999 $ 9
·30 June 2000 Loss of $313.00
·30 June 2001 $ 9
33. Attention was drawn by his Counsel to the expenses of the business which included wages. The Husband’s evidence in re-examination was that the wages were paid to himself. The wages for the years in question are as follows:
·1999 $ 8,136
·2000 $15,435
·2001 $19,750
34. The Husband asserts that as at 1994 when cohabitation commenced the business was worth $25,000. There is no evidence whether other financial statements have been produced but exhibit 6 would appear to be the financial statements for the last three years of the operation of the business.
35. The balance sheet for the year ending 1999 reveals a deficiency of $513 and for the following year a deficiency of $826. For the year ending 30 June 2001 the statement of financial position reveals an overall liability of $817.
36. The Husband’s evidence is that after the Wife acquired the Brisbane Suburb 1 property in February 1997, the business paid the electricity, rates and motor vehicle expenses, as this resulted in a tax benefit.
37. For the three years in question the electricity payments claimed as a tax deduction would appear to be as follows:
Electricity
·1999 $ 74
·2000 $ 55
·2001 $ 141
Rates and Land Taxes claimed as a tax deduction:
·1999 $ 1,217
·2000 $ 124
·2001 $ 131
38. It would appear from a combination of the Wife’s evidence and the Husband’s evidence that the business paid for the whole of the rates and electricity for the period of some five years from February 1997 when the house was acquired, through to February 2002, when the Husband took up the position at the sports club in Central Queensland.
39. I appreciate the figures quoted above are only the percentage attributable as business expenses and do not represent the whole of the payments. There was no attempt by the Husband to quantify what his contribution was to the outgoings on the property in dollar terms, but it is the Wife’s evidence, which I accept, that by the time the business ceased operations it was not earning sufficient funds to even pay the household expenses such as electricity and rates.
40. The financial statements (Exhibit 6) detail the company’s motor vehicle expenses. I am not prepared to find that the motor vehicle expenses resulted in any form of contribution by the Husband. Having regard to the nature of the business it is likely the vehicle he used was used almost exclusively for his own benefit or for business purposes. The evidence would indicate the Wife had the use of her own vehicle.
41. In relation to the motor vehicles, notes forming part of the accounts reveals the Husband’ s motor vehicle in use for the years 1999 and 2000 was acquired for $2,500. Presumably this is the Mazda he says he brought into the relationship in 1994 valued at $2,000.
42. In the year ending 30 June 2001 the Husband acquired a vehicle valued at $21,333. It appears there was an accompanying liability of $18,579. The evidence would indicate that the Husband took this vehicle to Town 2 and retained possession of it.
43. His business operated from 1990 until he closed it down in early 2002 and throughout that period appears to have accumulated very few assets and produced a very modest wage – less than half the rate for an employed tradesman in that trade.
44. I find it unlikely that the business was worth $25,000 as asserted. I find it equally improbable that the Husband would have equity in the Brisbane Suburb 2 property of $60,000 as at 1994. There is not one shred of documentation to support such a claim.
45. In paragraph 66 of his trial affidavit he says that on the sale (in 1993) he made, “about $50,000”. It is likely the Husband on the sale of the Brisbane Suburb 2 Property bought a yacht. I am unable to make a finding as to what he paid for it. He says he acquired it for $25,000, but, as with much of his evidence, I am sceptical about this claim. The Husband gives no details of when he sold it, to whom, or at what price. He simply says at paragraph 70 the proceeds went into household expenses. The Wife disputes this.
46. There is no evidence he was able to sell any of the assets set out in the depreciation schedule of the company. The depreciation schedule for the financial statements for the company for the year ended 30 June 2011 (page 13 of 19) would indicate that the written down value of the property excluding the recently acquired motor vehicle, was in the order of $3,896. Note 5 of the accounts relating to property, plant and equipment (page 11 of 19) would indicate that the plant and equipment was valued at $4,037.
47. There were three vehicles listed in the depreciation schedule for motor vehicles, being the utility which was disposed of on the 18 January 2001 for $1,500, the Holden Commodore Wagon and a van which was said to have a written down value of $4,751.
48. For a business which had operated for more than ten years the only observation that could be made is that the assets of the company were minimal.
49. As with the claims about the value of the C Street property, the Husband’s attempts to value the business in the way that he has, reflects poorly on his credibility.
Acquisition of Brisbane Suburb 1 Property by Wife
50. The Wife’s evidence is that in January 1997 her parents made a loan of $15,000 to her to assist her to acquire a property at Brisbane Suburb 1. In February 1997 a Commonwealth Bank home loan in two forms was approved. This loan document is Annexure 1 to the Wife’s trial affidavit filed 30 August 2010. Loan one was at a variable interest rate in the sum of $62,019. Loan two was at a fixed interest rate for $70,000 (total $132,019).
51. In the Husband’s trial affidavit he says at the date of separation in September 2005 the variable home loan had reduced to $54,943 and the fixed home loan to $57,214. This evidence is not challenged.
52. There is no direct evidence that I can find as to the exact price paid for the home but I proceed on the basis it was in the approximate range of $145,000 to $150,000 being the amount of the loan together with the borrowing from her parents - allowing for stamp duty, legals and other expenses of acquisition.
53. The only major asset of the parties which remains is the Brisbane Suburb 1 property.
54. It is noteworthy that at no time during the relationship did the parties share a joint account, nor did they appear to operate joint credit cards. The Wife’s account of the acquisition of the Brisbane Suburb 1 property is set out in her trial affidavit, paragraphs 2 and 3 with her evidence corroborated by the actual loan documents with the Commonwealth Bank.
55. As previously quoted, the Husband’s account is to be found in his trial affidavit, paragraph 67:
“67.When we decided to buy another house, it was placed in [the wife’s] name only because I had a business and if the business was not successful then the house was protected.”
56. I reject the explanation given by the Husband why the house was placed solely in the Wife’s name. At best the account given by the Husband reveals dubious business ethics and an, understandable, singular lack of confidence in the likely success of his business which at that point in time had been operating for about seven years.
57. Having made those observations I accept that it is a not uncommon practice in business circles where parties are in business for themselves to place assets in the names of only one of the parties if that party is not associated with the business.
58. What the Husband does not explain is that the Wife was a director of the company, S Pty Ltd. There is reference to the Wife signing as a director at page 12 of 13 of the financial statements for the year ended 30 June 2000. Further evidence of this is to be found in the director’s report (page 16 of 19) of the financial statement for the year ended 30 June 2001 of the company (Exhibit 6). The Husband’s claim then that the Brisbane Suburb 1 property was only placed in the Wife’s name because she was not involved with the company, is plainly an incorrect assertion and again, reflects poorly on his credibility. In any event assets in the names of the parties would not be liable to be seized by creditors of the failing company absent some form of guarantee being provided by the directors of the company. I find it is improbable that only one director would be asked to sign a guarantee in relation to personal assets particularly where that director did not have any other assets of any significance that had been disclosed.
59. Leaving aside a modest amount of superannuation, the Husband’s financial statement reveals that at age 48 he is currently worth $7,657 (refer item 44 of Husband’s amended amended financial statement filed 18 August 2010).
60. The Wife says in her trial affidavit she repaid $15,000 borrowed from her parents in the first year of the loan. In her affidavit she gives specifics of the two loans taken out with Commonwealth Bank. At paragraphs 5 and 6 she deposes:
“5.I have been the sole payee of the home loan mortgage from the first payment in February 1997 to this very day 17 August 2010 – some $199,707.96 plus plus. From June 2005 (the date of separation) to August 2009 alone, summary attached, documents and bank statements previously attached and still available if needed.
6.I continued to have sole financial responsibility for all expenses and liabilities incurred for the property (bank statements reflect this) and have been disclosed # Annexure 3 […].”
61. If the Husband had $25,000 from 50 per cent of the proceeds of the sale of the Brisbane Suburb 2 property, $25,000 having gone into the purchase of the yacht, it is curious that the Wife borrowed the deposit for the Brisbane Suburb 1 property amounting to $15,000 from her parents. It would have been a much simpler task for the parties to have used those funds as the deposit to avoid any additional borrowing as the Wife was borrowing heavily on the mortgage from the Commonwealth Bank.
62. The Wife concedes at paragraph 7 that when running the business from the house in the relatively brief period from February 1997 until December 2002, the Husband paid from the business the rates and electricity charges. As noted above for the period immediately prior to separation this would appear to be very modest indeed. Even allowing he paid the whole of the rates and electricity up until the date of closure of the business, it is still a miniscule contribution (when compared to that made by the Wife when assessing the value of the asset as at the present time). The Wife’s evidence, which I accept, is that the business deteriorated until prior to its closure and the income generated was not sufficient to pay for even modest household expenses.
Wife’s Ongoing Contribution to the Brisbane Suburb 1 Property
63. The Wife’s consistent evidence, which I accept, is she has made all repayments on the mortgage on the property since its acquisition in 1997, and she has paid all other outgoings other then for the brief period when the Husband paid rates, electricity and other charges as he was operating his business out of a shed on the property and had an office in the downstairs section of the house.
64. At all times the Wife has demonstrated her capacity to be financially responsible. She is very disciplined in ensuring borrowed moneys are repaid expeditiously, such as the $15,000 deposit from her parents which was repaid in the first twelve months after the borrowing. Throughout the whole period she has maintained detailed financial records.
Superannuation
65. It is common ground that the parties’ superannuation interests are approximately equal and it was agreed that no order be made in relation to either fund. Because of their respective ages neither party is entitled to access superannuation entitlements for a good many years and it was partly for this reason that there was consensus that the superannuation entitlements be disregarded. There is no evidence of the superannuation funds being advised of any order being sought. The Wife submitted that the difference in the respective superannuation entitlements is that as she is no longer working her superannuation fund is stagnant and subject to ongoing fees whilst the Husband’s continues to increase in value. I accept the force and accuracy of the submission in these terms.
Wife’s Financial Position
66. A summary of the Wife’s financial position is to be found in Part B of her financial statement filed on 30 August 2010. Her average weekly income is $967.60. She is a full time carer/home maker. Her income consists of $380 rental income from the Brisbane Suburb 1 property, a Family Tax Benefit of $127 and a carer allowance and carer payment of $433. In addition she receives child support in the sum of $26 a week.
67. The Wife says that the total value of property owned by her is $461,360 and her liabilities are $219,448.
68. The Wife resides in Adelaide with her partner Mr J, her son X born in April 2001 and Mr J’s daughter, M who is some two years older then X. Mr J is employed as a … . His annual income is approximately $60,000 a year. In Annexure 2 to his affidavit filed on 19 February 2009, he has completed a financial statement. In that document he indicates he has assets of $422,900 and liabilities of $46,000. His superannuation entitlements are $226,883.
69. He was not required for cross examination. I proceed on the basis that his financial position has not greatly changed in the intervening period.
Husband’s Financial Position
70. The Husband filed an amended amended financial statement on 18 August 2010. He says his weekly income is $795. His personal expenditure is $390. The total value of property owned by him is $7,657 and the total of his liabilities is $300.
71. He is employed by the G School.
Section 79 Factors
72. I have rejected the Husband’s claims as to his initial contributions. I proceed on the basis the initial contributions of each of the parties were of a minimal nature, although if the Wife’s estimate as to the value of her vehicle and furniture be correct, her contribution would have exceeded the Husband’s. However, I am unable to make any such finding.
73. The relationship was just over ten years duration with a period of physical separation in 2002.
74. The contribution of the Husband during the first half of the relationship is lessened by virtue of the fact he could have worked as an employee in his line of work and produced an income almost double what he earned in conducting his own business. I was somewhat cynical that the Husband may have been receiving cash payments in the operation of his business and deliberately not declaring same as a way of minimising income tax liability. There is no evidence that this is the case. In particular, the Wife’s evidence is that his income as revealed to her, was of a minimal nature. At all times I have found the Wife to be a reliable and honest witness. During the periods that she worked the Wife was able to earn a reasonable income commensurate with her qualifications in the education field. During the first half of the relationship she worked as a director of a small business. Subsequent to separation she was employed in an executive capacity for a charitable organisation. At times when she was in Town 3, as I understand the evidence, she assisted the Husband in carrying out his duties and in addition did some casual work in her field. The times she was not working during the relationship were as a result of her relocating to Town 3 to resume cohabitation with the Husband, but also because of the special needs of the child, she found it increasingly difficult to work full time and care for X.
75. By far the greatest contribution has been the acquisition by the Wife of the Brisbane Suburb 1 property and her determination through thick and thin to keep up the payments on the property. I accept her evidence there has been no contribution by the Husband with payments of mortgage instalments or contribution to repairs and maintenance.
76. Although the property was not negatively geared, I accept the Wife’s evidence that it produced very little by way of income. Exhibit 4 is the document from her real estate agent covering a period from the 1 July 2009 to 30 June 2010. This reveals an income for the period of $19,747 with outgoings of $5,105.
77. What this document does not take into account, of course, is the repayments under the mortgage.
78. The Wife’s financial statement filed 30 August 2010 reveals payments of $285 a fortnight on each of the two loans making a weekly payment of $285. This amounts to a total payment of almost $15,000 per year which combined with the outgoings revealed on Exhibit 4, exceeds the income produced from the property. The Wife’s evidence (transcript page 36) is that at one stage she had to introduce $8,500 to effect repairs and she did this with no assistance from the Husband. Her evidence is that in 2009 she contributed $4,000 for repairs and maintenance to the property.
79. At Annexure 2 to her affidavit filed 30 August 2010 she sets out a schedule of mortgage payments and draw downs on the mortgage for the period June 2005 until August 2009. The figures she produces are as follows:
“CBA Home Loan account […]
Repayments June 2005 – August 2009 $105,982.48
Less drawings down June 2005 – August 2009 ($113,003.00)
($7,020.52)
CBA Home Loan account […]
Repayments June 2005 – August 2009 $ 93,725.48
Less drawings down June 2005 – August 2009 ($124,031.50)
($ 30,306.02)
Summary
Total repayments June 2005 – August 2009 $199,707.96
Less total drawings down June 2005 – August 2009 ($237,034.50)
$( 37,326.54)”
80. The accuracy of this document was not challenged in any way.
Legal Fees of the Parties
81. The Husband’s legal fees to the commencement of the hearing were said to be in the order of $14,000, of which he had paid some $5,000. It was estimated that to the completion of the hearing the fees would be $20,000. It was common ground that the Wife’s legal fees were $78,000 up to the time when her legal representatives ceased to act for her in late 2009.
82. It was the Husband’s contention that to fund these fees the Wife had drawn down on the home loan with the result that the mortgage was considerably greater than it otherwise should have been and the equity in the Brisbane Suburb 1 property correspondingly less. The mortgage as at the date of separation had been reduced to a combined total of $111,000, but at the date of the hearing was $192,000.
83. The estimates proffered by the Husband as to the calculation of any “add back” on account of the draw down on the mortgage being used to fund legal fees, vary from a low of $15,000 to a high of $80,000. At paragraphs 94 and 95 of his trial affidavit the Husband deposes as follows:
“94.In total [the wife] has withdrawn from the mortgage a total of $81,286.
95.From that it has been ascertained from discovered documents that $15,000 of these funds was paid to [the wife’s] solicitors.”
84. This document was sworn on the 17 August 2010 immediately prior to the trial on the 1 September 2010.
85. At trial Counsel contended that the full amount of $80,000 should be treated as an add back. I am not minded to accept submissions made by Counsel in this regard as the evidence indicates that of the total fees of $78,000, $45,000 had been borrowed from family and friends and of this $27,000 remained outstanding.
86. The Wife’s evidence was somewhat confusing. She initially indicated she had utilised three draw downs, each of $20,000, on 16 February, 2009, 20 April 2009 and 30 July 2009, to pay legal fees. She later resiled from this position. The Wife’s demeanour at all times was of a litigant who was both stressed and distressed. She was of an extremely nervous disposition doing her best to be both honest and reliable.
87. The Wife’s later account was that she had paid the solicitors $33,000 from her income. She had been working in an executive capacity with a charitable organisation for a period after her return to Brisbane up until her move to Adelaide in late 2008. She appears to be of a frugal nature and presumably she had acquired some funds to pay her legal fees. She may well have paid some of it from the Centrelink benefits she was receiving. The Wife’s clear evidence, which was not subject to any challenge, was that the sum of $27,000 remained owing to family and friends from a total borrowing of $45,000. The effect of this is, she had repaid family and friends $18,000 of the moneys borrowed and she had paid $33,000 directly from her income to the solicitors.
88. The home loan which was originally in the amount of $132,000, either at the original time or subsequently, was changed to a line of credit type loan. In view of the fact the current liability is in excess of $192,000 there must have been a further advance on the mortgage approved at some point in time.
89. The Wife’s evidence is that the draw downs on the mortgage were for the support of her child.
90. She provides in considerable detail what those expenses consisted of, broken down into different categories for medical, educational, travel and general expenses (refer Exhibit 13). There was no challenge to the accuracy of the documentation annexed to the Wife’s affidavits. Indeed, having regard to the degree of specificity provided it would be difficult to see how there could be such a challenge.
91. Exhibit 13 reveals, by way of example, that for the month of November 2005 expenses related to the child totalled $4,171.16. For the month of December 2005, the expenses were said to be $2,114.35.
92. Counsel in making the submissions that the full $80,000 draw down should be treated as an “add back”, made reference to the decision In the marriage ofTownsend 18 FamLR 505 a decision of the Full Court (Nicholson CJ, Fogarty and Jordan JJ) where the Court held:
“In appropriate cases the Court may bring the value of matrimonial assets distributed prematurely into the pool of assets on a notional basis.”
93. The evidence in that case was that the trial Judge had effectively disregarded a sum of $148,000 from the sale of a taxi licence by the Husband. The Husband used the moneys largely for his own purposes:
“Although to some extent, also for the purposes of the children.”
He repaid a debt to his mother of $12,500 out of the funds and paid $53,540 in respect of his own legal costs of custody proceedings that he had conducted against the Wife, which had been determined some years previously.
94. In the judgment of the Chief Justice (page 509) with which the other Judges concurred his Honour noted:
“In all of the circumstances, therefore, it seems clear that there was demonstrable error on his Honour’s part in relation to the respective earning capacity of the parties. [This was a separate issue].
I am satisfied also that on the principal issue his Honour did not approach the matter correctly, and should have taken into account the full amount of the moneys received by the Husband in making his calculations, subject to certain deductions to which I shall turn shortly.”
95. Thereafter in the course of his judgment the Chief Justice made observations that certain expenditure paid from the proceeds of the sale of the taxi licence were legitimate and accordingly allowance should be made on that account. His Honour observed by way of example that $12,895 had been used for the purchase of a motor vehicle, which vehicle had been brought into account as part of the asset pool. Clearly it would involve double counting to bring the whole proceeds of the taxi licence back into account.
96. At page 510 his Honour observed:
“Mr Golding argued that a number of other reductions should be made in relation to matters such as rent, household purchases and children’s requirements and food and general expenses. However, it seems to me that this ignores the fact that the Wife similarly had such expenses and has had them certainly since she had the children returned to her following the hearing in 1992. It does not seem to me appropriate to take those matters into account and of course it was not argued by
Mr Golding that the sum of $53,540 expended by the Husband on legal costs should be taken into account in his favour as his Honour would appear to have done in the course of his reasons for decision, because to do so would have meant that the Wife was, in effect, subsidising the Husband’s own action against her in relation to custody.”
97. Counsel for the Husband in the course of his submissions on this issue, made reference to the decision of Chorn v Hopkins (2004) FamCA 633, a decision of the Full Court (Finn, Kay and May JJ) delivered on the 9 July 2004. In the course of that detailed judgment reference is made to a number of other cases in which the Full Court has considered the appropriate treatment of legal fees incurred by parties in the course of litigation.
98. The Court noted the judgment of Fogarty J in the decision of Farnell v Farnell (1996) FLC 92-681 at 83068 where his Honour observed:
“My strong impression from sitting on appeals in a large number of property cases over the years is that the common or usual practice is that, unless the parties themselves choose to approach it another way:
the liability of the parties for costs is generally disregarded in the sense that they are not treated as liabilities to be deducted in order to arrive at the net property figure;
costs already paid are not generally added back as notional property unless the particular circumstances justify it (such as here);
the circumstances of each party does have legal costs needs to be taken into account in a general way in considering the overall impact of the orders on the parties;
The circumstances that the parties have or have paid legal costs is a basic factor in determining, at the conclusion of the proceedings, whether an order for costs should be made within the parameters of s 117.
99. Reference at paragraph 42 of the judgment was made to the decision in Marker (1998) FamCA 42 where the Full Court (Baker, Kay and Chisholm JJ) observed at paragraphs 2.10 and 2.11:
“…because of the requirement for each party to bear their own costs, it is generally appropriate to add back to the pool of assets notionally any legal costs that have been spent on the litigation and to deal with the costs as a separate issue at the end of the litigation. (see Farnell (1996) FLC 92-681).
211.There seems to be no appropriate basis for notionally adding back moneys that existed at separation but which have been subsequently spent on meeting reasonably incurred necessary living expenses. Neither the Family Law Act nor the case law require that parties go into a state of suspended economic animation once their marriage breaks down pending the resolution of their financial arrangements. Parties are entitled to continue to provide for their own support. Where any expenditure so incurred is reasonable or extravagant is a matter that can be determined by the trial Judge.”
At paragraph 43 in the Hopkins judgment their Honours observed:
“43.We read the Full Court as here approving the adding back as a notional asset of monies in existence at separation which have subsequently been used to pay legal costs, although the Court cautioned against the adding back the use of such monies for reasonable living expenses.”
At paragraph 48 of the judgment their Honours quoted from the decision of Ibrahim v Beavis (1999) FamCA 765 where the Full Court (Lindenmayer, Finn and Holden JJ) observed:
“…we are of the view that Farnell’s case does not stand for the proposition that moneys expended on legal fees must always be added back into the asset pool irrespective of when or how the moneys were accumulated to pay those fees. That case makes it quite clear that it is a matter within the discretion of the trial judge depending upon the particular facts of the case.”
The trial Judge in that case (Ibrahim’s case) had observed:
“…it is another thing altogether to determine that if one party from money accumulated after separation pays his or her legal fees with that money that this must necessarily be added back into the notional pool for the purposes of determining what the distribution is between the parties. In many cases, the sum so applied may well represent the accumulation of some years of joint contributions or contributions in whichever proportions may have been the case during the course of the marriage but in circumstances such those applicable in the matter before me, it would be unjust and unfair to (in effect) require Ms Beavis to recredit amounts that she has paid for legal fees. I might add, the same is equally applicable to the money that Mr Ibrahim has paid.”
At page 49 of the Hopkins judgment the Court noted:
“49.This decision [Ibrahim’s] establishes that in determining whether or not paid legal fees should in the exercise of the discretion be added back into the asset pool, it is necessary to consider when and how the funds used to pay fees have been accumulated.”
Effectively the Wife’s case is that the reasons for the draw downs were to fund the considerable medical expenses, pharmaceutical expenses and educational expenses for the child during periods when she was not employed. For payment of the legal fees, she was required to borrow. I accept the accuracy of the expenses for the child as set out in great detail in the annexures to the Wife’s affidavits. There is no suggestion that any of the expenditure would fall into the category of excessive or unnecessary. Clearly, this is a child with high medical and pharmaceutical needs.
The contribution made by the Husband has been minimal. Where the Wife has had the greater burden of caring for the child, whether one brings that into account in a percentage sense or by refusing to bring the draw downs into account as an add on, to my mind matters little.
If the legal fees had been paid for by the draw downs, but in supporting the ongoing high level expenses for the child she has had to bear, it was necessary to borrow from the family, appropriate allowance should be made for such expenditure which has not been contributed to by the Husband.
In the particular facts of this case I have not the slightest hesitation in finding the Wife was an honest witness and that the reality is that she has repaid the legal fees in large measure from her own income and/or through borrowings from family and friends. The draw downs which have persisted for many years should not be treated as an add back. There is no evidence how the Husband has funded the $5,000 legal fees that he has paid. There is a suggestion by the Wife that he had $10,000 in a bank account and it may well have come from such source, or it may have come from accumulated savings from his salary. In the whole of the circumstances for the reasons given I do not propose to add the $81,000 or any lesser amount as an add back to the asset pool.
Summary of Contribution Factors Pursuant to Section 79
I find that during the period from the commencement of cohabitation in 1994 until March 2001, immediately prior to the birth of the child, the Wife’s income would have been significantly greater than the income produced by the Husband. There are no figures provided by the Wife as to how much she earned as a director at a small business but it would not be difficult to produce a greater income than that earned by the Husband during the relevant period.
As noted previously, considerable contribution was made by the Wife by her sense of financial responsibility. Looked at globally, the evidence produces a clear picture that the Husband has not been financially responsible and the Wife has at all times displayed considerable financial responsibility.
There is little evidence of the contribution as home maker and parent, but by virtue of her high work ethic, I would be of the view that the Wife’s role as home maker and parent during the period of cohabitation would have been considerably greater than that of the Husband. In her financial questionnaire filed 30 August 2010 in paragraph 6 she notes:
“6.I was the primary financial provider as well as the home maker and domestic duties, for example cooking and cleaning were my responsibilities. Duties pertained to a “traditional” marriage. I cooked, ironed, cleaned and ensured adequate balance in our lifestyle with organisation of social events and entertainment and all of [X’s] medical education and living arrangements.”
There was no cross examination of the Wife, or indeed by the Wife of the Husband, of the respective roles of home maker and parent. In the considerable period since separation in September 2005, the Wife’s role as home maker and parent in caring for the child has greatly exceeded the contribution by the Husband. The Husband has paid minimal assistance to the Wife during this period.
In considering the contribution factors in favour of the Husband, I accept that the Wife has had the use of the Brisbane Suburb 1 property for a period of about two and a half years from June 2006 until December 2008. I accept that he has made contributions by way of payment of the private health insurance but this contribution is lessened somewhat by the lack of evidence of the additional cost to the Husband of including the child on the policy. He has made modest payments by way of child support.
For her greater contributions which have been particularised above with no comparable contribution by the Husband, it is appropriate that the property of the parties be divided 70 per cent/30 per cent on account of s 79 factors. The orders for property settlement as sought by the Wife when she filed an amended initiating application on 10 July 2010, do not differ to any extent from the orders set out in her case management document to which reference has been made.
Counsel for the Husband made submissions about paragraph 3 of the Wife’s financial questionnaire where she asserted that the current contribution based entitlement was 65/35. During the course of her final submissions she noted that this was information provided to her by her solicitor. It is quite clear from paragraph 8 she perceived an overall adjustment of 90/10 as being appropriate. I do not intend to place any weight on the Wife’s estimate of the current contribution, as the Wife was not legally represented at the time she completed the financial questionnaire, although she claimed she had received some legal advice in relation to its contents.
Section 75(2) Factors
In a typed document headed “Closing Address” the Wife notes:
“The distinguishing feature in this case is I believe the enormous input of myself as primary carer for our son [X] over the past nine and a half years and the ongoing medical cost attributed to his special needs along with the ongoing living and educational costs of raising [X] into the foreseeable future.”
The Wife’s financial statement would indicate that the amount of child support she was receiving as at the date of that document was $26.37 per week. Some of the Husband’s benefits from his employment comes from fringe benefits which seemingly have not been factored in, in assessing the weekly amount of child support. The amount of contribution for child support the Husband has paid has not varied greatly from the time of separation in 2005 to the present time averaging the token amount of $25 per week.
To her trial affidavit the Wife has annexed the expenses she has incurred in supporting her son.
As part of Exhibit 2 the Wife annexes full details of the repayments and the draw downs over the relevant period. The Wife could in no way be criticised for failing to disclose full details of her financial circumstances. She has set out in great detail (refer Annexure 13 to her trial affidavit) a breakdown of medical, education, travel and general expenses for the period from shortly after separation through until mid-2009.
In contrast there has been a paucity of disclosure of material by the Husband, a matter upon which the Wife was justifiably critical.
Important considerations when assessing what further adjustments, if any, should be made on account of s 75(2) factors is firstly the additional expenses incurred in tending to the child’s special medical needs and secondly whether the Wife is able to engage in any form of employment. It was Counsel’s submission that because the Wife had the greater potential earning capacity there should be an adjustment back in his client’s favour when determining any percentage adjustment on account of s 75(2) factors.
Child’s Medical Condition
Annexed to her affidavit filed 8 December 2008 the Wife appends a series of medical reports. In the report of Dr W dated 23 November, 2007, he confirms that he has looked after X since birth and that the child has had a number of “complex” problems related to his urinary tract:
“[X] has required extensive reconstructive surgery. [X] also has problems in terms of his general development and is being managed by [Dr O], Developmental Paediatrician at [Hospital 1] for these problems. [X] has difficulty with both bladder and bowel control.”
The Wife’s evidence is that one of the motivating factors in relocating from Brisbane to Adelaide was that the Hospital 2 in Adelaide was able to provide specialist care which was not available at that time in Brisbane.
In Adelaide the Wife consulted Dr B a Paediatric Urologist.
Dr B wrote a letter to the Husband dated 1 May 2008, which is in the form of a medical report. This document is Annexure 5 to the Wife’s affidavit filed 8 December 2008. At the second paragraph of the letter Dr B notes:
“As you are aware [X] has a long and complicated urological history dating back to ante-natal diagnosis of bilateral hydronephrosis, that is dilatation of both renal pelves and ureters and subsequent pyelopalesty and ureteric re-implantation.”
Dr B makes a recommendation for further surgical intervention. In the final paragraph of the letter she notes:
“Overall I think [X] has major issues with ongoing vesico ureteric reflux that are impacting on his bladder function making it more difficult for [X] to feel when his bladder is full and making it more difficult for him to enter his bladder. Hopefully his bladder function will improve following surgery to correct the vesico ureteric reflux however, it may be, if it doesn’t improve then [X] will require intermittent catheterisation for a period of time following the surgery and it is impossible to predict how long this will be.”
Dr W provided a further report to the Husband’s solicitors of the 14 May 2008 in response to questions put to him.
Overall, I am satisfied that the Wife has, to the very best of her ability, attended to a high standard of care to X’s medical needs. These medical needs have required a great deal of effort and commitment on her part.
There has been no comparable contribution by the Husband.
Future Employment Prospects
Mother’s Medical Condition
In relation to the child related proceedings, the parties had attended upon
Dr V and he provided an assessment of the parties by way of a report which is annexed to an affidavit filed on the 25 August 2010.
At page 11 of the report Dr V notes:
“I consider that the Mother suffers from depressive illness as described. It is likely that she has been depressed since [X’s] birth but to varying extents, perhaps with periods of remission. At the time of the interview there was mental state evidence of depression.”
In the penultimate paragraph on the same page Dr V notes:
“There is no evidence that the depressive disorder has affected her capacity to be a parent to the child. Indeed all of the data indicates that she has looked after the child with great devotion and effort.”
At the final paragraph on page 12 of his report Dr V notes:
“When a child has such significant medical problems it is difficult to know what “normal” parenting ought to be. In such situations mothers in particular are often over-involved and over-protective and this may affect the child’s capacity to develop independence. This is to some extent normal in the circumstances. Fathers on the other hand often underestimate the extent of impairment and tend to want to “normalise” the situation. Both approaches have their benefits and that is why a child needs two parents. Moreover the father can be conceptualised as putting limits on the natural tendency of enmeshment between mother and child. If the mother is in fact “over-mothering” the child then this may be related to depression, but this is preferable to “under-mothering” which is a more common sequelae of depressive illness.”
I accept the accuracy of this assessment provided by Dr V. Counsel for the Husband, in the course of cross examination and submissions at the hearing, suggested that the Wife was capable of employment at some point in the future. In view of her medical history and the child’s medical history, I would not be in any way critical that she has not undertaken gainful employment, but has preferred to focus on the child’s care and attention. It is likely this situation will prevail for a considerable period.
The Wife’s sister, Ms V, is a professional person residing in Brisbane who works two days a week in a private practice in the city.
She affirmed an affidavit which was filed on the 17 February 2009. At paragraphs 6, 7 and 8 of that affidavit she deposes as follows:
“6.During the course of 2008, it became evident that the applicant could no longer manage the demands of full time work and the demands of [X’s] medical conditions and additional educational requirements. After [X’s] operation in July 2008, despite an understanding employer it became clear to our family and to the applicant, that [X’s] needs were such that the applicant would have to give up work or that her continuing employment would be compromised. I observed the applicant struggle with full time work and these issues until November 2008.
7.[X’s] medical conditions are such that the applicant must regularly take him to visit specialists including a Urologist, Gastroenterologist, Paediatrician, Psychologist and Physiotherapist.
8.[X] also has learning difficulties which require the applicant to spend additional time taking him to tutoring.”
The evidence of this witness was not subject to any challenge. I have also had regard to the affidavit of the Wife’s current partner, Mr J. An affidavit affirmed by him was filed on the 19 February 2009. The relevance of that affidavit was primarily related to children’s issues which have been resolved.
Payment of Medical Expenses
Annexed to her trial affidavit the Wife appends details of the medical expenses she has incurred for the child.
The Medicare records are to be found as Annexure 7.
It shows extensive attendances on medical practitioners. The schedule fee and the benefit received are set out in that document.
There is no evidence that the medical practitioners have charged more than the scheduled fee.
At transcript page 53, when questioned about the change to the MBF health insurance policy the Husband’s account was in the following terms:
“…No, I didn’t cease making those payments until I received a phone call from [the mother], and it was in regards to a matter in regards to flying [X] up to [Town 2], and she said, “Well, if you don’t pay for the whole air fare, I am going to take you off the MBF policy and then you won’t get another policy”, and I said, “Well, hang on. That sounds a bit threatening”. So I actually contacted MBF myself and said, “This is the scenario. I am the one who has actually been paying that. What, you know, can I do about it?” and they said, “Well because we have acknowledged that you are the one that is actually paying the money, we will allow you to open up your own MBF policy”, with myself and [X] on it, without any waiting period or anything. So I then actually phoned [the mother] and said to her that I would be opening my own policy with [X] and myself on it and I continued paying into that.”…”
I find the account given by the Husband to be inherently implausible. I do so for a number of reasons. First and foremost the position in relation to the airfares was governed by virtue of an interim consent order made by Federal Magistrate Burnett on the 28 April 2009. At paragraph 6(d) that order provided:
“6(d)Each party shall contribute to the costs of the Father’s time with [X] pursuant to these Orders and to that end the Mother shall be responsible for the cost of [X’s] travel to Brisbane or [Town 3] and the Father is to be responsible for the cost of [X’s] travel from [Town 3] to Brisbane or the Father’s usual place of residence.”
I find it inherently improbable that the Wife would make any form of threat which would place her in direct conflict with existing Court orders. The evidence of the Wife would indicate that she had been paying the whole of the air fares to enable the child to spend time with his father. If she did make the threat in terms of the evidence quoted from the Husband, one might well ask what would be wrong with the Husband paying an air fare to see his son. In any event, the threat was said to have been made in terms that if he did not pay the air fare she was going to take him off the MBF policy. There is no indication as to why he would not be able to get another policy. Any threat made in those terms, to my mind, did not justify the Husband unilaterally removing the Wife from the policy, the effect of which caused great stress to her.
In circumstances where the child was being cared for primarily by the Wife in Adelaide, such conduct by the Husband could only have resulted in inconvenience and upset to the Wife. In circumstances where it appears to have been done without adequate consultation with the Wife, I can only question the bona fides of the motives for engaging in such conduct. The Wife’s evidence is that in order to have the child placed on the Husband’s MBF policy rather then being on her policy, the Husband would have had to certify to the private health fund that he was the primary carer. It is not for this Court to carry out a separate investigation as to the circumstances in which the child came to be placed on his father’s policy, but if the Husband did certify that he was the primary carer of the child it was a demonstrably false statement, even if made during a period when the child was spending time with him.
The Husband says (transcript page 60) that he had been informed by MBF:
“…if both of us were separated and being seen as sole parents, [X] actually can be on both policies. That is the way I understood it to be and that is the way I believed it was happening.”
The Wife’s evidence is that she had been informed that this was not possible. I once again accept that the Wife’s account is likely to be more accurate. It would seem highly improbable that a private health fund would allow a child to be on two separate policies.
The conditions which have prevailed since separation are likely to continue in the future, namely a minimal contribution by way of child support from the Husband and a huge commitment from the Wife in terms of the high level special needs of the child.
Travel Costs
The consent orders made on 1 September 2010 in relation to children’s issues provide that when the Husband is to spend time with the child, the Wife is to be responsible for the expenses of the child travelling from Adelaide to Brisbane and the Husband is to be responsible for the air fares from Brisbane to Town 3.
On many occasions in the past, the reality has been the Wife has borne the greater share of the transport costs in facilitating time spent between father and son. Annexure 18 to the Wife’s trial affidavit is a letter from travel agents detailing the air fares incurred totalling $11,369. The Wife’s sworn evidence is that she has been responsible for all travel expenses in facilitating time spent between the Husband and his son when it was the child doing the travelling. This was the case even while she was residing in Brisbane. Despite her levels of stress and anxiety, the Wife could never be criticised for failing to encourage a positive relationship between the child and his father. The evidence is redolent with examples of encouragement of this relationship.
On account of the s 72(5) factors I am of the view that a further adjustment of 15 per cent is appropriate, leading to an overall division of 85 per cent of the assets to the Wife and 15 per cent to the Husband.
The major reason why I make the additional adjustment, is the fact that since separation the Wife has contributed to a far greater extent to the travel costs. She has contributed for the most part for the payment of medical expenses. She accepts that the Husband was paying the private health insurance policy for the three of them, but she says that during this period he was having dental work and other expenses from which he derived considerable benefit. There is no evidence what the difference in expenditure would be for the Husband in having the Wife and/or the child on his policy. The main factors which influence the additional 15 per cent relate to the likelihood that the Wife will find it difficult to work in the future because of her own depressed condition and the high level needs of her son. She will also have to bear the high cost for his medical and pharmaceutical needs with minimal contribution from the Husband.
Assets of the Parties
At paragraph 98 of the Husband’s trial affidavit he deposes:
“98. The assets are now as follows:…”
He lists the Brisbane Suburb 1 property. It is common ground that the value to be adopted is $460,000. In addition the Husband deposes to the following assets:
“…
Holden Commodore Motor Vehicle $5,000
Inflatable Boat and Motor $2,000
Furniture and contents $5,000”
In his amended amended financial statement filed 18 August 2010, the Husband deposes that the Honda motor bike is no longer an asset.
Item 59 of the Husband’s financial statement indicates that he disposed of, immediately prior to or subsequent to separation, the following items:
“…
Honda motor bike private sale $1,800
White Commodore $3,000.”
Clearly the white Commodore, which has been disclosed, differs from the vehicle mentioned at item 40, being a black Holden Commodore which the Husband values at $5,000.
In his affidavit at paragraphs 84 and 85 the Husband deposes that there were two vehicles at the time of separation. He retained the white Commodore, which clearly he has disposed of for $3,000, and the Wife retained a Nissan vehicle. The Wife’s statements to the Court in the course of her final address in relation to this vehicle, was it was in poor condition and was of no value.
At paragraph 86 the Husband deposes to the acquisition of the black Holden Commodore for $8,000. He asserts this vehicle would now be worth, “about $6,000”. The same vehicle in the financial statement is valued at $5,000. I propose to adopt the higher figure.
There was no adequate explanation why the Husband was seeking orders that he retain his boats, motors and all electrical appliances and equipment when only one boat and motor was being disclosed by him.
I do not propose to bring into account current bank accounts. The Wife says her bank account as at the time of preparation of her financial statement was $360, and the balance of the Husband’s account was $557. Having regard to the minimal nature of these accounts and the amount of time since the date of separation, I propose to safely ignore these minor assets. Counsel for the Husband submitted that I should ignore the assets all together as they have been accumulated over a period of time since separation. Where the Wife has been directing any surplus funds to paying expenses of the home, the Husband has been able to utilise any surplus funds in acquiring motorcycles, motor cars, boats and such like. I see no reason why the assets in the Husband’s possession should simply be ignored. I am not prepared to accept the submissions made by Counsel for the Husband in this regard.
Furniture
The Wife’s evidence is at the time of separation she left with a suitcase and the child and returned to Brisbane. She is now residing in a home with her partner in Adelaide. In her financial statement (item 42) she values the household contents at $500 and a Mazda vehicle at $500. There was no challenge to these items. I will bring these items into account in the amounts nominated.
The Husband deposes that the value of furniture and contents is $5,000. As there is no evidence that he has valued the Wife’s material, I proceed on the basis that the furniture and contents are the furniture and contents in the possession of the Husband.
Accordingly, I find the assets of the parties to be:
Former matrimonial home (agreed value) $460,000
Less: mortgage as at date of trial $192,448
Equity in property $267,552
Add: Wife’s Mazda car $ 500
Add: Wife’s furniture and contents $ 500
$268,552
The Husband’s assets are as follows:
Holden Commodore vehicle $6,000
Inflatable boat $2,000
Honda motorcycle $1,800
Furniture and contents $5,000
Sale proceeds of white Commodore $3,000
$17,800
Total assets $286,352
Husband’s entitlement at 15 per cent $ 42,952
Husband has received $ 17,800
Wife to pay Husband $ 25,152
I am satisfied that an order requiring the payment of $25,152 by the Wife to the Husband represents a just and equitable determination as between the parties.
For the above reasons orders will issue as set out on page 3 of these reasons.
I certify that the preceding one hundred and sixty-two (162) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Barry
Associate:
Date: 18 April 2011
Key Legal Topics
Areas of Law
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Family Law
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Property Law
Legal Concepts
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Remedies
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Costs
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Jurisdiction
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Injunction
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