M v G

[2004] QSC 267

SUPREME COURT OF QUEENSLAND

CITATION:

M v G [2004] QSC 267

PARTIES:

M

(applicant)
v
G
(respondent)

FILE NO/S:

BS 7403 of 2002

DIVISION:

Trial Division

PROCEEDING:

Hearing

ORIGINATING COURT:

Supreme Court

Brisbane

DELIVERED ON:

12 August 2004

DELIVERED AT:

Brisbane

HEARING DATE:

10, 12 August 2004

JUDGE:

McMurdo J

ORDER:

1.   That the applicant transfer to the respondent all her right, title and interest in and to the property located at I

2.   That the respondent transfer to the applicant all of his right, title and interest in and to the real property located at B

3.   The respondent transfer to the applicant all of his right, title and interest in and to the Land Rover.  The transfer to occur as soon as practicable.

4.   The applicant pay to the respondent the sum of $75,240

5.   The parties otherwise be entitled to retain as their own those chattels, motor vehicles, shares and other assets presently in possession of each of them

6.   There will be a further order that the transfers of real properties and the payment of the transfers of real properties and the payment of $75,240 occur simultaneously and on a date which is 12 November 2004

7.   Liberty to apply

8.   Parties’ bear their own costs

CATCHWORDS:

FAMILY LAW AND CHILD WELFARE – DE FACTO RELATIONSHIPS – LEGISLATION – OTHER JURISDICTIONS – where application for property settlement – where parties were in de facto relationship from September 1995 to August 2001 – where applicant was the sole salary earner from September 1997 to end of relationship and made capital contributions – where respondent performed domestic duties though was away for some of the time and made significant capital contributions – whether there should be payment made by one party to the other and if so, what should be the amount of payment

Property Law Act 1974 (Qld), Part 19, s 291, s 297, s 298, s 291 – s 309

COUNSEL:

A C Smith for the applicant

R M Galloway for the respondent

SOLICITORS:

G R Brown for the applicant

Neilson Stanton & Parkinson for the respondent

HIS HONOUR:  In this proceeding, the applicant M

has applied for orders under Part 19 of the Property

Law Act 1974.  The respondent, G, cross

claims for orders under that Part.  As I will describe in

these reasons, the parties substantially agree that they

should be entitled to the assets respectively in the

possession of one or the other, including the two pieces of

real property jointly owned by them.

The dispute, in substance, is whether there should be any

payment made by one party to the other, and if so, what should

be the amount of that payment.

The parties were in a de facto relationship, as that term is

defined for the purposes of Part 19 from, I find,

approximately September 1995 until about August 2001.  It was

not until September 1995 that the parties lived together which

is when the respondent moved to the applicant's then house

in Victoria.  On one view, the relationship may have

ended by the end of 2000, but it is clear that it was at an

end at least by August 2001, because from that date the

respondent resided elsewhere. 

The applicant is a school teacher working full-time and is

presently aged 47.  She lives in a house at B (“the house”). 

She earns about $56,000 per annum.  The respondent is aged 54,

turning 55 next month.  He was employed by Telstra until 1997

when he accepted a redundancy payment.  He lives on a rural

property of about 22 hectares at I (“the farm”) where he

keeps some cattle.  In the past two years he has worked,

earning a taxable income ranging from 27,000 to $30,000 per

annum.

The parties are the registered proprietors of each of the

house and the farm.  Each property is

unencumbered.  It is agreed that the house is worth $275,000,

and the farm $205,000.  The parties also agree on

what constitutes the other relevant property, and the value of

it.  That agreement is reflected in the schedule which has

been marked Exhibit 5 in these proceedings.  That property

includes a Land Rover motor vehicle which is in the possession

of the applicant and a number of items such as vehicles,

cattle, what is described as "cattle money", and some parcels

of shares owned by the respondent.  Also within the list of

assets in Exhibit 5 there is an amount of $12,300 being

savings in an account of the respondent.  It seems to be

common ground that those savings have been accumulated since

the end of this relationship and that they would not

constitute part of the relevant pool of assets to be allocated

or distributed by an order under Part 19, although, of course,

the fact that the respondent has those savings is a relevant

consideration for the ultimate outcome.  There is also a Volvo

motor vehicle, of little value, listed on that schedule which

is an item acquired since the end of the relationship.

Leaving aside those two items of what might be described as

after acquired property, there are, in what the submissions

have characterised as the relevant pool of assets various

items of real and personal property of the combined value of

$519,400.  The applicant's case is that orders should be made

for the transfer of the house to her, the transfer of

the farm to the respondent, and for each party to be

entitled to any other item of property in his or her

possession.  This would see the applicant having the Land

Rover motor vehicle and the respondent having the other assets

set out in that schedule.  As I have mentioned, the

respondent's case seeks effectively the same division of a

assets, but further element of his case is that there should

be a payment to him by her.  According to his pleading the

amount of that payment should be of the order of $82,500, but

on the basis of the evidence and the agreed values of the

assets and, in particular, the two real properties,

the respondent's case now is that there should be a payment of

the order of $153,150 to him.

In essence the respondent's case for a substantial payment to

him rests on the basis that, as appears to be conceded by the

applicant, most of the capital used to acquire the

unencumbered title to the real properties was contributed by

the respondent, and further, that the house is the

more valuable of the real properties.  However, the

applicant's case is that this is counterbalanced by at least

two factors:  first, that from 1997 until 2000, or perhaps

2001 she was effectively the sole breadwinner of what remained

still as the relevant family unit, and second, that, as the

parties agree, she has made substantial improvement to the

house since the parties separated in amounts which

it is agreed total $37,682 and which it is also agreed have

added some $55,000 to the value of that property.

At the outset of the relationship the parties lived in a house

which the applicant had purchased in Victoria.  She had

borrowed all of the purchase price which involved borrowing

$80,000 from a financial institution and $35,000 from a

friend.  When he moved into that house the respondent borrowed

$35,000 to repay that debt.  That house was sold after the

parties moved to Queensland in 1996.  It was sold, it seems,

for less than its cost, and the net proceeds of sale were

barely enough to pay out the financier.  A surplus of $16,355

from the sale became available.  The parties

purchased the house at B in the middle of 1996.  The cost

was about $130,000, of which $95,000 was raised from a

financier.  The applicant's mother provided a short term loan

of about $24,000.  At that point the family at B

consisted of the applicant and her two children from her

marriages, and the respondent and his teenage son from his

marriage.  The applicant worked full-time as a teacher, and

the respondent worked full-time for Telstra.  It seems that

the respondent earned something of the order of $15,000 per

year more than the applicant did.  Their funds were pooled in

one, and later two joint bank accounts.  The parties bought

the farm in 1997.  They saved the deposit to which

the applicant says that she contributed something of the order

of $6,900.  The balance purchase price of approximately

$78,000 was funded from the respondent's redundancy payment of

$145,000 which he received in or about September 1997.  He

also used that payment to pay out the mortgage on the house.

The respondent did little remunerative work from then; that

is, from about September 1997 when he left Telstra until about

two years ago.  He began to spend much of his time at the farm

working on the property.  He was spending about 40 per cent of

his time there.  The applicant and the three children lived at

the house at B.  She continued to work and earned more than

$50,000 per annum.  At B there were also one or two boarders

who provided some extra income for the household.

The respondent eventually moved to the farm full-time in about

August 2001.  From 1997 to 2001 the applicant's income was the

only substantial income of this couple.  He performed work at

house at B such as cooking, but he was at the farm much of the

time, and it was not suggested that he performed all of the

domestic chores whilst he was at B.  After the end of

the relationship, as I have said, the applicant contributed

substantial capital to the improvement of the house at B and

the parties now agree as to its amount.

I turn then to the facts relevant to the considerations as

prescribed by section 291 of the Act. The respondent

addressed me as to the respective contributions made by way of

what were described as "Capital input".  He urged me to be

careful to avoid double counting.  It is, I think, appropriate

in this case, to identify the particular contributions of

capital made by each party as distinct from funds generated by

any joint savings from their pooled incomes.  From the

applicant I regard those contributions as:  $50,000 from her

property settlement consequent upon her divorce; $16,000 from

the proceeds of a life policy, and the sum already mentioned,

$37,682 as her contribution to the house at B which is a total

of contributions of this kind of $103,682.

The respondent's contributions of the same kind I would see as

being the following:  $22,000 from his divorce settlement;

$145,000 from his redundancy payment, and a sum of $40,000

from recourse to some of his superannuation which he drew in

October 1997 being a total of $207,000.  Each of these amounts

can be seen as a particular contribution made by one party to

the acquisition of relevant property being the real properties

or the Land Rover which was purchased for $28,000 from the

$40,000 drawn by the respondent from his superannuation

entitlement.  As to that $40,000, Exhibit D to his affidavit

is a copy of his instructions for that withdrawal and for its

deposit to a particular account, which was one of two joint

bank accounts then held by the parties.  Neither side sought

to tender the bank statement of that bank account for the

relevant period, but there was a controversy as to whether the

full $40,000 had been paid to a joint account, and if it had,

whether any of it, apart from the $28,000 used to buy the

Land Rover, had been used as the respondent claims, which is

that it was used for expenses at the farm.  It is to be noted

that the request for that draw-down was made at a time which,

in substance, coincided with the completion of the purchase of

the farm.

It is agreed that $28,000 was paid from a joint account.  The

applicant did tender bank statements, not for the account to

which the respondent had asked the funds to be paid, but for

the parties' other joint account, and plainly the Land Rover

was not purchased from that account.  I infer that funds were

paid by Citicorp as requested according to the document

which is Exhibit D to the respondent's affidavit.  I accept

also the respondent's evidence that the balance of the funds,

that is, the $40,000 less the $28,000 for the car, were, in

substance, used for the start up expenses of the farm.  The

applicant said that this joint account had been opened to save

moneys towards the acquisition of the farm.  There is no other

suggested application of the $11,000 and the most likely

explanation for what happened to it, in my view, is that given

by the respondent.  I note that this occurred some years

before the relationship was near its end.

I have not included other suggested components of capital

contributions in the above list because I see them as being

amounts of another kind.  For example, the suggested

contributions to the deposit for the farm came from joint

savings into which the parties made contributions, in effect,

from their pooled incomes and child support payments.  The

contributions they made in those ways to what became their

joint funds are, of course, relevant and important, but as I

have said, I see them as being in a different category from

the individual capital contributions as I have described them.

There was also a draw-down of $2,000 on the respondent's

superannuation entitlements.  The application of this $2,000

was the subject of some debate, but again I do not see this as

being in the relevant category of capital contributions

towards the acquisition of property.  In the same way I do not

regard the various payments made by the applicant on her

Visacard, which show that she was contributing to the expenses

of the farm, as being in this category of capital

contributions.  Again, however, they are important in the

overall consideration of this case, but what they reflect,

which is surely the case, is that after 1997 the applicant's

income was the only income of these parties.  So apart from

those individual capital contributions, the properties and

other assets were acquired from the pooled resources of the

parties' earnings, for which for some time the respondent's

earnings exceeded those of the applicant throughout the period

in which any relevant asset was acquired.

In summary, then, according to the figures I have mentioned,

the applicant's capital contributions to the acquisition of

various assets were about one half of the contributions by the

respondent.  But I turn then to the other factors relevant to

what orders are appropriate in this case.  Some substantial

allowance must be made for the fact that the applicant was the

only breadwinner from September 1997 until the end of this

relationship.  That would not be so significant had the

respondent been at the house at B throughout this period and

engaged fulltime in domestic duties, effectively assisting the

applicant to earn or continue to earn income, but he was not

at B for much of the time and it seems to me that her

contributions both financial and otherwise to the welfare of

what still constituted the family were considerably greater

than his in this period.

Against this, however, it was his capital and in particular

his redundancy payment which had effectively provided the

house at B as a mortgage-free home, so in that sense he

contributed financially to the household without himself

earning any substantial income.  He had also contributed the

Land Rover motor vehicle.

I turn then to other factors which are of relevance, or

potential relevance, according to sections 291 through 309 of

the Act.  I have considered all matters required by those

sections to be considered where relevant, but I shall mention

some of them. As to the matter under section 297, as I have

said the respondent is nearly 55.  The applicant is 47.  There

is no medical evidence as to the state of health of either

party.  The respondent gave some evidence of some health

problems, which it is unnecessary to discuss in this judgment,

but relatively speaking he appears to be a man in good health.

As I mentioned, he is now and has been for some years involved

in remunerative employment, and clearly he does much of the

physical work on the property.  There is no suggestion that

the applicant is in anything but good health.

So far as section 298 is concerned, as matters have eventuated

it is the applicant who now has the higher earning capacity.

The applicant still has a child under the age of 18 years, in

the last few years of his schooling, whom she must maintain. 

It is submitted for the respondent that the applicant enjoys a

considerably higher standard of living when the conditions of

the house are compared with the apparently spartan

conditions under which the respondent lives at the farm.  I

had the impression, however, from his evidence that the

respondent was not so unhappy with the environment in which he

lives at the farm, and more generally he seems to have been

content with a lifestyle that would be a relatively

inexpensive one.  That is a matter of some relevance in

balancing the various circumstances that affected the

relationship of the parties from the time he ceased work in

1997.

The parties each have superannuation funds.  The applicant has

about one hundred thousand dollars accumulated in her fund, to

which she has made very substantial contributions in recent

years by sacrificing some salary.  The respondent has about

$300,000 in superannuation which he can draw upon retirement

as early as next month when he turns 55.  On present

indications, however, he does not intend to then retire, and

of course if he did so he would be without his present income.

In these circumstances then I have to determine what orders

are just and equitable by way of adjusting the property

interests of these parties.  It is appropriate that they be

adjusted, as the parties seem to agree, on the basis that the

applicant will have the house at B, its contents, and the

Land Rover, and the respondent will have the farm at I and

the other assets in what I have described as the pool.  As I

have mentioned, the assets in that pool have a total value of

$519,400.  On the basis of a consideration of only the capital

contributions, the respondent would have a claim to two-thirds

in value of those assets.  However, having regard to the other

considerations prescribed by the Act, and most importantly the

applicant's significant contributions during the period from

1997 to the end of the relationship, it is my view that the

respondent should not have two-thirds of the value of the

assets, but that he should have 60 per cent, or in effect

$311,640.  Under the proposed division of assets he would have

$236,400 worth of assets.  Accordingly, he should have a

further $75,240.  The result is that there will be orders as

follows -

(1)  that the applicant transfer to the respondent all her

right, title and interest in and to the property located

at I;

(2)  that the respondent transfer to the applicant all of his

right, title and interest in and to the real property

situated at B;

(3)  the respondent transfer to the applicant all of his

right, title and interest in and to the Land Rover;

(4)  the applicant pay to the respondent the sum of $75,240;

(5)  the parties otherwise be entitled to retain as their own

those chattels, motor vehicles, shares and other assets

presently in possession of each of them.

I shall hear the parties as to the orders which should be made

as to the timing of those conveyances and payment, and also as

to costs.  I indicate that the respective transfers of the

real properties, together with the payment, should occur

simultaneously.

MR GALLOWAY:  May I indicate, your Honour, we have no

objection to there being a period as long as 90 days for the

applicant to refinance or finance, and that the transfers of

payment should happen as a single settlement after that day.

HIS HONOUR:  Mr Smith?

MR SMITH:  That would be appropriate, your Honour.

HIS HONOUR:  There will be a further order that the transfers

of real properties and the payment of $75,240 occur

simultaneously and on 12 November 2004.

I give liberty to apply.

That leaves the question of costs.  Before we go to that, I

haven't provided for the transfer of the vehicle to occur

simultaneously.

MR GALLOWAY:  No, your Honour.

HIS HONOUR:  What I had in mind was that should be transferred

as soon as practicable.

MR GALLOWAY:  No reason why that shouldn't occur, your Honour,

as it were.

HIS HONOUR:  As to costs, does either party seek on order as

to costs?

MR GALLOWAY:  I can say that there have been offers exchanged

between the parties.  They all, may I say, hover around the

same mark, and if I may also say around about what your Honour

has ordered.  I don't think, however, either of us have hit

the target and I am mindful, your Honour, of the provision

that the parties bear their own costs unless there are certain

matters established.

HIS HONOUR:  That is why I asked whether either party sought

costs.

MR GALLOWAY: We don't.

MR SMITH:  I agree with my learned friend, your Honour.

HIS HONOUR:  Thank you.  I am grateful for the assistance of

each of you in this case.

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