MABBITT & MABBITT
[2021] FCCA 675
•7 April 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
| MABBITT & MABBITT | [2021] FCCA 675 |
| Catchwords: FAMILY LAW – Property dispute following 26 year marriage – parties contributions essentially equal – major dispute of assets controlled by the husband’s family – whether husband and family conspiring to alienate property to defeat wife’s claim – husband’s family trust undoubtedly altered after death of brother in 2016, but alterations pre-dated separation – trust assets not included in the pool, but husband’s family resources clearly available to the husband – 12% adjustment in wife’s favour for future needs appropriate. |
| Legislation: Family Law Act 1975 (Cth), s.75(2) |
| Cases cited: Commissioner of Taxation v Bamford [2010] HCA 10 Goodwin & Goodwin [1991] FLC 92-192 Harris & Harris [1991] FLC 92-254, Kennon v Spry [2008] HCA 56 Stanford & Stanford (2012) 247 CLR 108 |
| Applicant: | MS MABBITT |
| Respondent: | MR MABBITT |
| File Number: | MLC 928 of 2019 |
| Judgment of: | Judge Burchardt |
| Hearing date: | 11 March 2021 |
| Date of Last Submission: | 11 March 2021 |
| Delivered at: | Dandenong |
| Delivered on: | 7 April 2021 |
REPRESENTATION
| Counsel for the Applicant: | Mr Stavris |
| Solicitors for the Applicant: | Anthony’s Solicitors |
| Counsel for the Respondent: | Mr Williams |
| Solicitors for the Respondent: | Carew Counsel Pty Ltd |
DRAFT ORDERS
Payment
That within 90 days of the date of these orders (the date), the husband pay to the wife the sum of $896,898 (the payment).
Real property transfer
That contemporaneously with the payment:
(a)the wife do all such acts and things and sign all such documents as may be required to transfer to the husband at the expense of the husband all of her right, title and interest in the real property situate at and known as A Drive, Suburb B in the State of Victoria being the whole of the land more particularly described in Certificate of Title Volume xxxxx Folio xxx (the Suburb B property);
(b)the parties do all acts and things and sign all documents necessary for the husband to discharge and refinance the Australia and New Zealand Banking Group Ltd mortgage registered no AMxxxxxx (the ANZ mortgage) secured against the Suburb B property; and
(c)the husband indemnify the wife against all payments and liability pursuant to the ANZ mortgage and apportionable rates, taxes and outgoings of or with respect to the Suburb B property of whatsoever nature and kind.
(d)the wife do all such acts and things and sign all such documents as may be required to transfer to the husband at the expense of the husband all of her right, title and interest in the real property situate at and known as C Street, Suburb D in the State of Victoria being the whole of the land more particularly described in Certificate of Title Volume xxxxx Folio xxx (the Suburb D property);
(e)the parties do all acts and things and sign all documents necessary for the husband to discharge and refinance the mortgage with E Bank registered no xxxxxx (the E Bank mortgage) secured against the Suburb D property; and
(f)the husband indemnify the wife against all payments and liability pursuant to the E Bank mortgage and apportionable rates, taxes and outgoings of or with respect to the Suburb D property of whatsoever nature and kind.
That within 7 days of the date of these orders, the wife do all necessary acts and things and sign all necessary documents to provide to the husband a registrable withdrawal of Caveat number AR5xxxx in relation to the Suburb B property and AR6xxxx in relation to the Suburb D property, at her expense.
That in the event that the whole of the payment has not been made by the date then the Suburb D property be forthwith sold altogether out of Court (the sale") and upon completion of the sale, the proceeds of the sale be applied
(a)first to pay all costs, commissions and expenses of the sale;
(b)secondly to discharge the E Bank mortgage and any other encumbrance affecting the Suburb D property;
(c)thirdly such sum as is required to pay any CGT liability that may arise from the sale to be paid to the husband’s nominated bank account;
(d)fourthly so much of the payment as is then outstanding together with interest thereon in accordance with the Family Law Rules 2004 adjusted monthly from the date to the wife; and
(e)fifthly the balance to the husband.
That pending the payment or completion of the sale:
(a)the husband has the sole right to occupy the Suburb B and Suburb D properties and that during such right of occupation the husband pay all instalments pursuant to the ANZ and E Bank mortgages and all rates and taxes and like apportionable outgoings of the Suburb B and Suburb D properties as they fall due;
(b)the parties hold their respective interests in the real property upon trust pursuant to these orders; and
(c)neither party encumber the real property without the consent in writing of the other party, save for in compliance with these orders.
That contemporaneously with the payment date:
(a)the wife prepares and executes in favour of the husband a transfer of the whole of her right, title and interest in all shareholdings, in F Pty Ltd.
(b)the wife shall do all such acts and things and sign all necessary documents to transfer to the husband or his nominee, any and all of her interest that she may have in the following entities: i) F Investment Trust
(i)Mabbitt Family Trust
(ii)F Investment Trust
(collectively referred to as the Trusts)
including but not limited to, her credit loan account in the Trusts and from the date of compliance by the wife with her obligations pursuant to this Order, the husband shall indemnify the wife in respect of all claims of whatsoever nature and kind which may be made against her by reason of her interest in the Trusts or in respect of any income tax or other liability which may accrue by virtue of payments distributed to or received by her from the Trusts;
(c)the husband retains the sole use and control of F Pty Ltd and the Trusts (the entities) and any and all income, investments, assets and tax credits (if any), for his sole use and benefit (or at his discretion) absolutely:
(i)the wife:
1. provide a full release and discharge from and against any claim, right, entitlement or interest in any loan account in the entities; and
2. renounce and forego any power, right, interest or entitlement (legal, beneficial or otherwise) to or in the entities.
(ii)the husband indemnifies the wife as to any and all debts, liabilities and outgoings jointly incurred by the parties in their roles in the entities or by or on behalf of the entities, including any assessment for taxation, primary or provisional (and interest penalties and costs thereon) up to the date of these Orders.
Mabbitt Superannuation Fund
Paragraphs 7 to 12 of these orders are binding on the husband personally and in his capacity as Trustee (“the Trustee”) of the Mabbitt Superannuation Fund (“the Fund”).
The base amount allocated to the wife out of the interest of the husband in the Fund is $50,000 (the base amount).
Pursuant to section 90XT(1)(a) of the Family Law Act 1975, whenever a splittable payment becomes payable in respect of the interest of the husband in the Fund, the wife is entitled to be paid an amount calculated in accordance with Part 6 Family Law (Superannuation)
Regulations 2001 using the base amount and there be a corresponding reduction in the entitlement of the husband.
That this order has effect from the operative time.
That the operative time for the purpose of these Orders is the fourth business day after the date of service of a copy of these Orders upon the Trustee.
That, after service by the Trustee of the payment split notice pursuant to r.7A.03 of the Superannuation Industry (Supervision) Regulations 1994 the wife shall do all such acts and things and sign all such documents as may be necessary, including but not limited to making a request pursuant to r.7A.06 of the Superannuation Industry (Supervision) Regulations 1994 for the transfer of the transferable benefits from the Fund to a regulated fund of the wife’s choosing (the wife’s super fund).
That unless otherwise specified in these orders and save for the purpose of enforcing any monies due under these or any subsequent orders:
(a)each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders. The furniture, personal possessions, and like chattels in the Suburb B and Suburb D properties being deemed to be in the possession of the husband.
(b)monies standing to the credit of the parties in any joint bank account are to be divided equally between the parties and the accounts thereafter closed forthwith.
(c)each party forego any claims they may have to any superannuation benefits belonging to or earned by the other.
(d)insurance policies remain the sole property of the owner named thereon.
(e)each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these orders.
(f)any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
IT IS NOTED that publication of this judgment under the pseudonym Mabbitt & Mabbitt is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT DANDENONG |
MLC 928 of 2019
| MS MABBITT |
Applicant
And
| MR MABBITT |
Respondent
REASONS FOR JUDGMENT
Introductory
This is a property dispute arising out of a relationship which started with marriage in 1992 and finally ended in 2018. The applicant wife puts her case in two alternate ways. Her primary position is that various assets allegedly owned by the husband, but presently held by a trust and company, be included in the pool, and that the resultant pool be divided equally between the parties. Her alternative position is that, in the event that those properties are not so included, there be a division of the remainder, so to speak, 65/35 in her favour. The respondent husband’s position is that there should be an equalisation of the non-superannuation pool (both parties ultimately agree there should be an equalisation of superannuation) and, of course, that the properties that the wife seeks to include be excluded.
While it is easy to see why the wife seeks the inclusion of the various additional property in the pool, in the ultimate, I do not think they can be properly so included. For the reasons that follow, however, I think that a division of the rest should indeed, as the wife seeks, be 65/35 in her favour.
Agreed or Uncontroversial Relevant Matters
The wife was born 1964, and the husband was born 1966. They met in 1990, and as earlier indicated, married (and first cohabited) in 1992. Their children Mr G Mabbitt, born 1994, Mr H Mabbitt, born 1995, and Mr I Mabbitt, born 1998, followed in the fullness of time. The wife worked until the birth of Mr G Mabbitt and returned to work when the youngest child was at school. She has at all times been employed in relatively poorly remunerated employment, and is presently a sales assistant at Company J, a position she has held since 2009. She was diagnosed with cancer in 2005, but following what must have been a very stressful period, was diagnosed clear in 2008 and remains so.
The husband, by way of contradistinction, worked for the family business, Mabbitt Pty Ltd. Mabbitt Pty Ltd appears to have been established by the husband’s father and now deceased elder brother Mr K Mabbitt in 1975. The business expanded from its then premises to premises in L Street, Suburb M, by 1991. The husband had already been working for the company since 1984, and together with his brother Mr K Mabbitt and parents, they held three shares each in the business. A younger brother, Mr N Mabbitt, was granted three shares when he joined the business later.
At the start of the relationship, the wife owned a property in Suburb O, which was subsequently sold and the proceeds applied to the benefit of the family. The husband owned a block in Suburb P upon which the parties built a family home.
The parties subsequently bought a holiday home at Suburb D in 2000. The parties sold the Suburb P property and bought a block of land at A Drive, Suburb B, upon which they built the family home.
In 2009, there was a period of instability in the maMs Mabbittl relationship, but having heard the evidence, it is clear that the marriage survived. It is also apparent, having heard the evidence, that in 2013, the parties commenced sleeping in separate bedrooms, but they appear to have presented themselves as a married couple to third parties until final separation in August 2018. On the wife’s part, this is said to have been as a result of her commitment to the children, and on the husband’s part, it appears to suggest he may not have been as pessimistic about the matter as the wife in fact was.
The husband has stayed in the matrimonial home since separation, and the wife lives in shared accommodation.
The wife’s income from her job at Company J is about $32,000 a year, and the husband’s taxable income (including any ancillary earnings from the business) appears to be about $64,000 per annum.
The children have lived with one parent or the other from time to time, but in the ultimate, no one has suggested that their circumstances operate upon the consideration of this property dispute.
The Parties’ Affidavits
Although much of the parties’ affidavit material is in fact traversed in the section above, there are a number of other aspects of the matter that are worthy of note. In her first affidavit, the wife raised the circumstances of Mabbitt Equities Pty Ltd, which owns a number of properties, including those at L Street, Suburb M, where Mabbitt Pty Ltd operates.
In his responding affidavit filed 28 March 2019, the husband deposed to being employed by Mabbitt Pty Ltd but that that was owned by the Mabbitt Family Trust, of which Mabbitt Equities Pty Ltd is the corporate trustee. He deposed that he and his brother Mr N Mabbitt were directors of Mabbitt Equities Pty Ltd, and each hold a 10 per cent shareholding via separate family trusts, with the balance of 80 per cent held by Q Pty Ltd on behalf of his father and mother. The affidavit noted that Mabbitt Equities Pty Ltd owns a substantial number of properties. The affidavit noted at paragraph 13 that the husband was working in the family business at the start of the marriage and that he has never worked anywhere else. He deposed that the business was established in 1975 by his father and his brother Mr K Mabbitt, who died in 2016.
The affidavit noted that, since separation, the husband had had to employ a housekeeper at a salary of $300 per week and raised a loan of $150,000 paid to Mr G Mabbitt in 2017, of which $44,000 was said to be still outstanding, albeit that that $44,000 does not appear to have played any part in this proceeding.
The wife’s next affidavit, filed 9 February 2019, relevantly asserted purchases of Bitcoin by the husband, but the husband’s responding affidavit appears to suggest that these were sold with no profit.
The wife’s trial affidavit, filed 15 February 2021 (the trial was delayed by the COVID), deposed that the relationship broke down in 2013. She deposed that the loan in respect of the family home had gone from $353,000 in September 2017 to $539,000 in 2021. She also deposed to the shareholding structure of both Mabbitt Pty Ltd and of Mabbitt Equities Pty Ltd.
She deposed that Mabbitt Pty Ltd is a company started in 1993, with shares held equally between the husband, his brother Mr N Mabbitt, and Q Pty Ltd (albeit some shares being held through associated trust companies).
She deposed to the commencement of Mabbitt Equities Pty Ltd in March 1999, with each of the directors, being the husband and his brother Mr N Mabbitt, holding three shares, and the remaining 24 shares held by Q Pty Ltd. It was deposed, however, that this was subject to a variation to the Mabbitt Family Trust following the death of Mr K Mabbitt in 2016. Mr K Mabbitt died intestate, and letters of administration were said to have been granted on 14 August 2017. In essence, the wife complained that the various changes then made had the effect of defeating the husband’s (and therefore her own) interest in the Mabbitt family landholdings, if one could put the matter broadly.
I note that annexure “XXX-11”, being a valuation report prepared by Mr R, a valuation of Mabbitt Pty Ltd, values the parties’ net value of equity in the company at negative $645. This included, at paragraph 6.8.2, “There is a longstanding loan to all shareholders at $250,226. The original source of this loan is believed to be from the late Mr K Mabbitt. As Mr Mabbitt and Ms Mabbitt own one third of the company, I have attributed one third of the loan value to them ($83,409).”
The husband’s trial affidavit, filed 26 February 2021, gives his income as $54,789 for the year ended 30 June 2020 and that of the wife as $38,041. He deposed to selling shares in S Pty Ltd for $31,180 in May 2020 to meet legal expenses and to setting aside $53,110 out of his superannuation to enable a superannuation split.
I note that, at paragraph 27, when Mabbitt Pty Ltd was incorporated in 1986, his parents, his brother Mr K Mabbitt, and the husband received three shares each. Mr N Mabbitt started work in 1993 and was also given three shares. The husband deposed that he conducts administration and sales for the business.
At paragraph 29, the husband deposed:
Although my father reduced his role in the business in 1999, he continues to be the head of the business and visits the factory at least once a week, at which time he assists with sales. His name and legacy are ingrained in the community, and he continues to market and bring in a large client base for the business. My father receives a salary from Mabbitt Pty Ltd of $800 gross per week. My father is not in receipt of a pension, benefit or allowance.
The husband also referred to a significant downfall in business caused by the COVID emergency.
At paragraphs 35-36, having noted that the Mabbitt Family Trust deed was established in 1999, the husband deposed:
The Trust was created so that my parents could invest in real estate for their retirement. It was a discretionary Trust, and although Ms Mabbitt and I were listed as specified beneficiaries, our interest in the trust was nil.
Where I could not contribute financially to the assets purchased by the trust, I consider the assets held by the trust to be owned by my parents.
Having deposed to the death of his brother in 2016 intestate and the fact that his estate was inherited by the parents, the husband deposed at paragraphs 41 - 42:
Although I was included as one of three principals and one of three directors of the trustee company, I did not and do not consider the trust, or the assets held by the trust, as mine. I did not make any decisions in relation to the trust without consultation and direction by my father, who I considered to be in control of the trust, and his mission as principal of the trust was an error that was discovered following Mr K Mabbitt’s death.
Prior to Mr K Mabbitt’s death, there was no reason for us to review the trust deed, as Mr K Mabbitt, Mr N Mabbitt and I understood that our father, Mr T Mabbitt, was in control of the trust. The paperwork that I signed on behalf of the Trust was signed on my understanding, as Trustee of the trust, and was at the direction of my father, who was in control of the trust.
Having deposed to the necessity to amend the trust deed, when it was discovered following Mr K Mabbitt’s death that their father was not listed as a principal or specified beneficiary of the trust, and the changes involved in January 2017, the husband deposed at paragraph 48:
In mid-2018, Ms Mabbitt became aware that Mr N Mabbitt and I had not inherited from Mr K Mabbitt’s estate and shortly thereafter, she left the Suburb B property without notice.
I note that at paragraph 57, inter alia, the husband deposed that at the commencement of the relationship, his land in Suburb P, together with the house on it, was worth approximately $130,000.
I note that, at paragraph 63, the property at Suburb D, was bought for $86,000 in 2000. At paragraphs 64 to 65, the affidavit traverses the building of the Suburb B property following the purchase of the block of land in 2007 for $310,000 and a build of approximately $750,000 commencing in about 2008.
It should be noted that $310,000 used to buy the land came from “using borrowings from the Mabbitt Family Trust and a mortgage with U Bank”, and at paragraph 65, in relation to the cost of the build, the husband deposed:
The cost of the build was approximately $750,000 and was funded by borrowings from the ANZ Bank, from our joint savings, and borrowings from Mabbitt Pty Ltd, for which we still have an outstanding loan account of $267,085 as at 30 June 2020.
I note that, at paragraph 66, it is deposed that the Suburb P property was sold in June 2008 for $403,000, and the net proceeds of sale were applied towards reducing the loan from the Mabbitt Family Trust and the bank mortgage (although no details as to exactly how much was the net receipts nor as to how much of it was applied to each of these debts is given).
At paragraph 113, the husband deposes that he has been employed by Mabbitt Pty Ltd in an administrative and sales capacity from the time he started work. He deposed that his brother Mr N Mabbitt manages the factory.
I note that, at paragraph 131, the husband deposed in relation to his attempts to buy the wife out:
I have spoken with a broker who has told me that I can refinance the ANZ and E Bank mortgages into my sole name. My family members are willing to provide me with a loan to assist me if I am unable to refinance the two properties in my sole name and make the required payment to Ms Mabbitt.
He went on to say, at paragraph 132:
Ms Mabbitt will have the necessary funds to purchase a small property for herself, unencumbered or with a nominal mortgage which she will be able to afford to pay from her income and financial resources.
The affidavit of Mr N Mabbitt, filed on 26 February 2021, is essentially supportive of that of his brother.
The affidavit of Mr R, which, as far as I can see, appends the report earlier referred to as being appended to the wife’s affidavit, notes at page 20 of 35 the significant rents paid in relation to the factory and the significant variations across the years. I repeat my observations about paragraph 6.8.1 as to the origin of the $83,000 owed as a result of a debt from Mr K Mabbitt. I note that, at page 24 of 35, Mabbitt Pty Ltd had turnover of $1.4 million in the year 2018, a figure congruent with earlier years. The net profit was $882,000, and rent was $123,200, a figure substantially higher, as I understand it, than the figure actually paid. There were management fees of $30,000, for which no descriptor was given, and wages were $308,000 (bearing in mind that the wages paid to the three members of the Mabbitt family appear to come to approximately $150,000).
The affidavit of Mr T Mabbitt, the patriarch of the family, details his purchase in 1991 of the factory at L Street, Suburb M. I note, perhaps tellingly, at paragraph 7, the affidavit deposes:
L Street is the factory from which my business, Mabbitt Pty Ltd, trades. It was purchased using funds from the sale of two factories I previously owned in Suburb V. I financed the completion of the build at L Street using my personal savings and a temporary loan with the ANZ Bank.
At paragraph 9, Mr T Mabbitt deposed that his purchase of L Street in 1999 for $66,000 was as follows:
I purchased L Street using my personal savings. I did not require any finance from the bank. I authorised the children to register the purchase of L Street in the name of the Trust.
At paragraph 11, Mr T Mabbitt deposed to the purchase of L Street in 2000 for about $90,000, funded by way of finance, although it is now unencumbered. He went on to depose to the purchase of W Road, Suburb M, in 2003 for approximately $350,000 in the name of the trust by way of borrowings from the bank, albeit that the equity in trust assets was used for the security of the purchase. That property is valued at $850,000 and is unencumbered. That is at paragraph 14.
Mr T Mabbitt deposed that his son Mr N Mabbitt told him about a property at X Street, Suburb Y, in 2003, which was purchased in the name of the trust for about $350,000 by finance from the NAB. It is now valued at $1.2 million and is tenanted.
The affidavit deposed to the purchase of property at Z Lane, Suburb AA, in 2004, purchased by the trust for approximately $550,000 on finance. This property is valued at $635,000 and is unencumbered.
The affidavit deposed that, in 2010, Mr N Mabbitt recommended another development at BB Road, Suburb CC, which Mr T Mabbitt authorised as a purchase in the name of the trust for $750,000, all by finance. It is now valued at $3,250,000, and the shops are tenanted.
Finally, the affidavit deposed to the purchase of yet further property in Suburb AA in 2014 for $400,000, now valued at the same amount and tenanted.
At paragraphs 19-20, the affidavit deposed:
In early 2017, shortly after Mr K Mabbitt passed away in 2016, my wife Ms D Mabbitt and I discovered that because Mr K Mabbitt died without a Will, we would inherit his estate under intestacy laws. It was at this time that we also discovered that although I was in control of the Trust, pursuant to the trust deed I was not listed as a Principal or specified beneficiary of the Trust. After discovering this, we contacted our family accountant, Mr EE of FF Accountants and requested that he amend the Mabbitt Family Trust deed to remove Mr K Mabbitt as Principal and replace him with Q Pty Ltd.
Mr EE, Ms D Mabbitt and I had also discussed gifting a 10% fixed interest in the Trust to our two surviving children and their wives. I told Mr Mabbitt and Mr N Mabbitt what Ms D Mabbitt and I had decided together. We contacted Mr EE to fix a 10% interest in the trust for Mr Mabbitt and Ms Mabbitt and a 10% interest in the trust for Mr N Mabbitt and Ms GG, where they did not previously have a fixed interest. Mr Mabbitt and Mr N Mabbitt were required to attend upon Mr EE with me, as they were joint Principals at the time.
At paragraph 24, Mr T Mabbitt deposed:
Although I took a step back from the business in 1999, I have continued to attend the factory weekly and assist in a sales and marketing capacity. I continue to receive an income from the business of $800 per week from which Ms D Mabbitt and I meet our day-to-day expenses.
The affidavit of Mr EE, the accountant for the Mabbitt’s, deposes to a longstanding (in excess of 20 years) relationship with the family. Relevantly for these purposes, at paragraph 10, Mr EE deposed:
Following Mr K Mabbitt’s sudden passing in 2016 I saw the Mabbitt family at Mr K Mabbitt’s funeral. Following the funeral, Mr T Mabbitt, Mr Mabbitt and Mr N Mabbitt contacted me to discuss the implications of Mr K Mabbitt’s passing. During those discussions, the trust deed for the Mabbitt Family Trust was examined and instructions were provided by Mr T Mabbitt, and signed off on by Mr Mabbitt and Mr N Mabbitt, to facilitate the removal of Mr K Mabbitt as Principal and Beneficiary of the trust and replace him with Q Pty Ltd. Mr T Mabbitt also sought to fix a 10% interest in the trust for Mr Mabbitt and Ms Mabbitt and a 10% interest in the trust for Mr N Mabbitt and Ms GG, where they did not previously have a fixed interest. Those instructions were summarised in a document dated 9 February 2017.
At paragraph 13, Mr EE deposed to the submission of documents to ASIC after letters of administration in respect of Mr Mabbitt’s estate were granted on 14 August 2017. I note that, at paragraph 13.3, he deposed:
After the return from overseas of Mr T Mabbitt and Ms D Mabbitt on 13 August 2018, my office submitted a Change to Company Details, Changes to (Members) ShareHoldings to affect (sic) the transfer of shares from Mr Mabbitt and Mr N Mabbitt to Q Pty Ltd as trustee of Q Trust to align with Mabbitt Equities Pty Ltd shareholding to the fixed entitlement of the Mabbitt Family Trust deed.
He went on to depose that the trust had carried forward losses and had not distributed income to its beneficiaries for over 20 years, and as at 30 June 2020, the trust had carried forward losses of $220,710. I note that “XX-4”, being a true copy of the amended 2020 balance sheet which supports that position, does not include a footnote as to the value of the property, plant and equipment, and that the total value of the properties was $8,525,000. An ANZ business credit facility is disclosed as a liability in the sum of $691,726, but none of that shows exactly how much if any money is owed in respect of the properties that may not be completely owned outright.
All the other numerous affidavits are valuation reports which are not now, as I understand it, in issue, in the sense that the deponents were not required for cross-examination.
Materials Filed During the Trial
Exhibit A1 is an exchange of emails between Ms HH (the Mabbitt Pty Ltd bookkeeper) and the solicitor for the husband. Relevantly, they include an email sent from an address being Mr Mabbitt (which I should interpolate to say he convincingly explained was in fact from Ms HH) dated 21 March 2017, in which answers were given to several questions from the then solicitors.
Exhibit A2 are documents relating to the grant of administration in respect of Mr K Mabbitt’s estate. They include an inventory of assets and liabilities dated 28 July 2017, which show that Mr K Mabbitt owned a unit in Victoria and several bank accounts and a further unit in Queensland. Noteworthily, the inventory of assets and liabilities does not include Mr K Mabbitt’s shareholdings in either Mabbitt Pty Ltd or Mabbitt Equities Pty Ltd, or indeed in Q Pty Ltd, which had not, on any view of the matter, been transferred to anyone else at that time.
The Submissions Made and the Evidence Given at Court
What follows is taken from my notes.
The Opening and Evidence of the Wife
Counsel opened the case by referring to the case outline and submitted it was a simple case made complex by the husband’s position. The family trust was a major issue. The trust was established in 1999 with principals Mr Mabbitt, Mr K Mabbitt, and Mr N Mabbitt. Mr K Mabbitt died, and his shares were transferred to his parents. From 1999 until after separation, the trust operated on the basis that the three brothers owned one third each. The transfer was lodged five days after separation. The trust was varied to a fixed trust, and the grandparents took 80 per cent, and Mr Mabbitt and Mr N Mabbitt got 10 per cent each. Properties were transferred to the trust.
Between 2000 and 2014, the trust bought seven properties. Mr T Mabbitt was not the controller of the trust. The husband was the controller but sought to distance himself after separation. The income paid to the husband was treated as loans. The husband had not provided his brother’s documents, even though a notice to produce had been served. It was submitted the inventory of assets was critical (these were documents which ultimately became contained in exhibit A2). If Mr K Mabbitt was intestate, the shares should be in it. The letters of administration should be produced.
It should be noted that I caused, in effect, the respondent’s camp to produce the documents related to Mr K Mabbitt’s estate, because they were plainly potentially relevant to the proceedings. Technical arguments about custody and control and the like were, in my view, whatever their technical force, very unhelpful.
The applicant was called and adopted her trial affidavit and financial statement as true and correct.
Under cross-examination, the wife said that both parties owned property at the start. She had $5000 owing on her property, and the husband had a block of land for which there was no valuation. She recalled a profit of $88,000 upon the sale of her property for $93,000 a year after the marriage.
She confirmed paragraph 23 of her trial affidavit was incorrect. They built a house on the block of land and borrowed together and built the house together. She agreed that the relationship commenced in about 1990, and they were married in 1992. The husband was a shareholder in Mabbitt Pty Ltd, and she conceded that generated family income until separation, along with her contributions as well. The husband had shareholdings with his brothers and his father. They worked the business as a team. She was aware of the shareholding structure until 1999.
It was put that in 1999 the grandfather (as I shall generally refer to Mr T Mabbitt) stepped back. The wife said he retired, and the boys took over. It was put that the grandfather wanted to invest into properties, but the wife said this was never brought to her attention. The shares were transferred to the boys, and each had a trust. She was aware that the grandfather had bought L Street. When there was any talk of purchasing, it was always Mr Mabbitt who went to the bank. The grandfather did not enter the discussions. She denied that the grandfather and Mr K Mabbitt were involved and said it was always Mr Mabbitt. It was possible he discussed matters with his brothers but not with the grandfather. It was put that the brothers did not have money to buy property, but the wife said each time it would be a bank loan. Her husband organised this. The properties were bought by Mabbitt Equities Pty Ltd. The husband was director and shareholder with his brothers. All the properties were bought with loans.
It was put that she and the husband did not commit any funds to Mabbitt Equities Pty Ltd. The wife did not understand. She said the only sacrifice was that they lived on a very limited wage so that the loans could be paid for. When it was put to her that the grandfather had bought properties in 1975 and 1980 in Suburb V, the wife said this was correct but before her time. She agreed that the grandfather bought A L Street with his wife in 1991, and in 1999 bought B L Street from his personal savings. All the other properties were bought with loans. When it was put that numbers 22 and 29 were used as security to buy the properties, she could say nothing about that. She said that the company had continued without the grandfather from 1999 to now. She noted the valuation by Mr R as negative $645. Although Mabbitt Equities Pty Ltd and the trust existed, the husband used to say to her, “This will be our retirement.” It did not come across as being after the death of the grandparents. It was their retirement.
The wife said her father died in 2008 or 2009. He had a substantial property portfolio of eight properties, being a couple of shops and units. These are in her mother’s name. They will be divided between the wife and her three sisters, and it would be in the millions of dollars (although she was unable to give a valuation).
The wife said that Mr K Mabbitt died in 2016. She had moved into the spare room by then. They had separate bedrooms from 2013 and had been separated under one roof. She chose to stay because the children were at home. They had no holidays together in the last few years. She had moved out of the bedroom, and that was it. She had not discussed this with the children. She wanted a normal home for the children. She denied that there were conversations after Mr K Mabbitt died. The only discussion was that Mr K Mabbitt died intestate, without a will.
She denied an allegation that she had sought that the husband challenge for Mr K Mabbitt’s estate. When it was put to her that she had left the husband because it was apparent that no part of Mr K Mabbitt’s estate would devolve to her, she said this was an absolute lie. It should be noted that she became labile at this suggestion, which was clearly very offensive to her. And I should interpolate and say it, because it was obviously important to her – that her denial of seeking a share of Mr K Mabbitt’s estate was clearly true.
The wife said that their marriage had been slowly breaking down over a number of years. She had spoken to Mr Mabbitt a few months before. She had been diagnosed with depression. She had had a lot of medical issues. She had cancer and had chemo for five months. He took her two or three times only. In February 2018, it was her birthday. The in-laws and children were going overseas, and the company was paying for everybody, and everyone forgot her birthday. The husband knew it was her birthday. When he failed to do anything, she realised he did not care. The children were old enough. The separation had nothing to do with Mr K Mabbitt’s death. She had spoken to Mr Mabbitt and given him a few months to change, but he did not. She obtained a rental property in August, so that was when she moved out.
Mr K Mabbitt had entitlements in Mabbitt Equities Pty Ltd and the trust, and these went to the grandfather. The husband had implied that he himself had control of the trust, but she was never shown the trust deed. This was definitely discussed at the kitchen table. When it was put to her that the husband had told her that there were a number of people in the trust, the wife said, “Yes, absolutely.” Discussions were not necessarily about the trust. They were general. They talked about their future, their retirement. Of course, she understood that there were other people involved. The discussions between her and the husband and the whole family were, “I am going to do this or that.” He had a lot of pull in regards to what happened.
She saw the trust documents when Mr K Mabbitt died. There were three principals, who were the brothers. She understood that Mr K Mabbitt’s interests had been transferred to the grandfather. She was aware that the trust terms were altered and so were the directors of Mabbitt Equities Pty Ltd. Her position changed. She agreed that she and her husband had been given a fixed interest in the trust. She was only made aware of this after the fact. This disadvantaged her. She had only ever seen these documents in the trial process. She wanted a 50 per cent interest and that the 10 per cent interest be set aside. When it was put to her that the changes were made before separation, she said she was not aware of it at the time but is now partially aware. She is now aware of the share transfers and the trust deed variation in 2017. This was the year before final separation. As far as she was aware, the grandfather was not involved. She cannot put a figure on the grandfather’s interest.
The wife said the husband has paid some mortgage payments but has not kept up. Bank statements show the payments not made for months. The mortgage is now more than at separation. It was put that it was $565,000 at separation but $536,000 now. The wife said she had not seen today’s figure. She does not receive statements. She conceded that there were two payments of $30,000 each taken by the parties from the mortgage account. There had been lots of withdrawals and money moved that she was not aware of. She was unable to say what the mortgage was, as she had no documents.
There was a point at which there was no mortgage on that property, but he wanted to borrow for the business. When it was put to her that the husband said the mortgage was always there, she totally disagreed. That money had not been used for the family. It was put that if you added 50 per cent of the trust to the pool, she would have the home unencumbered, and the wife agreed. Plus he would have to pay her. She had never asked for anything specific. He could keep the properties. She wanted a figure to be paid out to her. The husband has access to trust assets.
It was put to her that the trust had assets of $3.5 million, and that capital gains tax would apply upon sale, and she did not challenge those matters. She said there was more available to him than he is making out. Many times, he has had total control. She cannot pinpoint every single one. So far as the property at Suburb CC was concerned, he went to the auction and was the manager. He made out to her as if he was the one doing it all. After the II Street, Suburb Y property wanted to put up a billboard, he was the only one who did the VCAT hearing. It was very obvious to her that the brothers were involved, but the husband made the decisions.
She agreed that her earnings were about $38,000 a year. She appeared to agree with the husband’s tax return figure of $54,000. His salary is low because they choose this. It is not necessarily what he makes. In re-examination, the wife said in the past, over the years where she was not earning, she was receiving $500 from the husband. She asked him why it was not more, and he said two things. He said all three brothers get the same. They put the money back in to get more money. Loans and mortgages were used to buy trust assets. She confirmed the accuracy of paragraphs 71 to 74 of her trial affidavit.
The Opening and Evidence of the Husband
Counsel opened with a history of the matter. Mabbitt Pty Ltd was set up by the grandfather in 1975, and in 1986, the husband became involved in the business together with his father and Mr K Mabbitt. In 1993, Mr N Mabbitt joined. The husband got three shares, Mr K Mabbitt three, the grandfather three, and then Mr N Mabbitt was given three shares also. In 1999, this changed. The husband had five shares, with four shares held through his family trust, and likewise, Mr N Mabbitt and Mr K Mabbitt. Mr K Mabbitt’s trust was held through Q Pty Ltd. The grandfather stepped back.
The grandfather bought properties in Suburb V in 1975 and 1982, which he sold and then bought A L Street. In 1999, the grandfather bought B L Street, and these were placed in the control of Mabbitt Equities Pty Ltd and the family trust, which was set up for the first time. Properties were then purchased up till 2014. These were the assets in the wife’s case outline. They were worth $3.5 million net. The trust was set up with three principals, who were effectively the appointors. This was Mr Mabbitt, Mr N Mabbitt, and Mr K Mabbitt. They were directors of Mabbitt Equities Pty Ltd, and the shareholding as company trustees reflected this.
The grandfather was not an appointor or a directorial shareholder in Mabbitt Equities Pty Ltd. The husband was not aware of this until Mr K Mabbitt died. He had not seen the trust deed. The accountant says that the grandfather was in charge of the trust. The trust deed requires joint decisions. The wife and husband had not contributed to the trust, although the husband did work for it. The husband was not the major player. It was Mr K Mabbitt until his death. There was a meeting prior to the separation with the accountant following Mr K Mabbitt’s death in 2016. This revealed that the grandfather was not part of Mabbitt Equities Pty Ltd and the trust, and rectification occurred in early 2017.
Mr K Mabbitt died intestate, and his Q Pty Ltd shares were transferred to the grandfather and grandmother. The transactions were dated January 2017. The husband and wife and Mr N Mabbitt and his wife received 10 per cent of the trust each, and Q Pty Ltd got 80 per cent. The husband and wife have fixed entitlement worth about $345,000. This does not include capital gains tax or selling costs. This was a lengthy relationship, from 1990 to 2018. Both made contributions at the start. The husband had a one-third business and some minor properties. The contributions should be assessed as equal.
So far as section 75(2) matters were concerned, the wife earns a modest income, as does the husband. The value of Mabbitt Pty Ltd has not been challenged. The trust interest is worth $345,000. The wife will receive an inheritance. There should be a minor adjustment in favour of the wife. The cars referred to that are in the pool should be included. It is thought the wife’s is worth $10,000, and the husband does not have a car.
The husband was called and adopted his trial affidavit and financial statement as true and correct.
Under cross-examination, the husband was asked if he was in control of the trust. He said he had never had 100 per cent control. The family operate as a team. It was put that this was Mr K Mabbitt, himself, and Mr N Mabbitt. The husband said Mr K Mabbitt was the eldest and therefore the major player, but they all had some input. Mr K Mabbitt was the controller until his death. His father had the final decision, but Mr K Mabbitt was the eldest brother. The father said he and Mr N Mabbitt looked for direction. He denied that Mr K Mabbitt had died of alcoholism. His left ventricle failed. It was put that the husband had taken over because Mr K Mabbitt was a drunk, but the husband said he had never seen him drunk. He said they were working together for over 30 years and had lunch every day at work. His answer in this respect struck me as being slightly evasive, but I would further interpolate and say I found the attacks on Mr K Mabbitt’s character unnecessary and unattractive.
The husband said Mr K Mabbitt was always common sense. They had five shares each and four in the trust. He was a one-third owner of Mabbitt Pty Ltd. He was not privy to setting up the trust. His one-third interest in Mabbitt Pty Ltd gives JJ (his trust company) $5000 a month. In 1999, it was basically his father and Mr K Mabbitt setting up the trust with Mr EE, the accountant. He and the wife were building an extension on the home and were busy with that. He was told what had been set up, but he was a bit confused. He realises now that Mabbitt Pty Ltd and Mabbitt Equities Pty Ltd are different. He said they only looked at the trust documents after Mr K Mabbitt died. He thought the business was attached to the trust but has since found out it was not. The trust was something his father and brother had control over. The business was what he would talk about at the kitchen table. The mother was more negative than positive. He had only had one lawyer. He submitted a time line the way he understood it. He still has his time line, which is a 10-page document.
I interpolate again and say the husband’s answers at this point were evasive and non-responsive to the questions put.
The husband conceded there were 27 shares in 1999. He conceded that the properties owned by Mabbitt Equities Pty Ltd were held for the trust, and he conceded that A L Street was allotted to Mabbitt Equities Pty Ltd in August 2000. He thought number B L Street was transferred in November 1999. It was put that B L Street was transferred to Mabbitt Equities Pty Ltd in 2000. The husband said the trust was set up to hold a property portfolio. B L Street was bought for cash by his father. He conceded the purchases of other properties through to 2014. He said the wife made no contribution, and neither did he. The first couple of properties were bought by his father.
The husband was questioned about bank loans. He said there was always a deposit, either paid in cash or by loan. The first two were by cash; the rest were bank loans. They were all rental properties. They would have been rented. If money was still required, it could come from the business. This would have been handled by the accountant. Ms Mabbitt also wanted more money. Their lifestyle was not short of money. She never worked for 15 years.
It was put that the Mabbitts were maximising wealth and limiting tax to build up a nest egg. The husband said he had a job to do and did it. The wages were based on a fair income. He conceded there had been some guarantees and that he had guaranteed loans to Mabbitt Equities Pty Ltd, and that he has never had to pay a shortfall. Mabbitt Equities Pty Ltd used the rent money to pay loans. The safety net was the business. He said they got a lot out of the business with a good lifestyle. When it was put that they were building up Mabbitt Equities Pty Ltd to get a nest egg later, the husband said the business paid them well. They had a beach house. They took more than they put in. He agreed that the property portfolio had increased in value.
When asked why there had been no purchases since 2014, the husband gave a startlingly non-responsive answer all about his brother Mr K Mabbitt. He then went on to say that in 2016, his brother died, and it has been a whole saga since that has consumed his life. He had lost a lot of drive when his brother died. His father and brother were thinking about debt reduction. He was running his own life. When asked if any decisions were put in writing, the husband said that they had meetings with the accountant once per year, but he had nothing in writing. His brother was the oldest brother. He was the spearhead with his father. As soon as his brother passed, they went to see Mr EE. He had not looked at the trust deed before. He saw Mr EE. His parents decided to give him and Mr N Mabbitt 10 per cent. His parents wanted to say thank you. He always thought his father was the chairman, but then Mr EE explained it. It was the first time he was aware the grandfather was not in the trust.
When asked who had provided the instructions to vary the trust deed, he said his father instructed Mr EE. First, they had to remove his brother from Q Pty Ltd. The accountant prepared the documents.
When asked about the separation, the husband agreed this took place in 2018. Ms Mabbitt went through a rough patch after the death of her father. They had separate beds in 2013.
It was put that the asset registry was not updated until 10 August 2018 in respect to the changes to Mabbitt Equities Pty Ltd. The husband conceded this was the case and said it was five days after she moved out. He said once she moved out, the marriage was unsalvageable. When asked if he lodged the document hoping that they would not separate, he said he did not want a separation. He said that if his brother had not passed, the changes would not have happened. It was put that the trust was discretionary, but the three brothers made decisions fairly. He said he had to add back his father. This was not equal. His father always believed the property was his – the trust and all of the properties in it.
He and his brother directed the ship. He could not remember the last time there was a distribution. Mr K Mabbitt was a tradesman. The husband does sales, and Mr N Mabbitt is the maintenance man. The husband conceded signing the instructions to amend the Mabbitt Family Trust deed dated 9 January 2017. There was a sequence of meetings. It came from his father’s directions to Mr EE. He trusted Mr EE to do the documents correctly. It was all because his brother died. He has a 10 per cent interest in Mabbitt Equities Pty Ltd, which is a gift from his parents. When asked why this gift was made, he said you would have to ask his father. His father wanted to distribute what he had, and he was happy to accept it. He first spoke to his father not long ago. It was this year.
He believed that his father had obtained letters of administration regarding Mr K Mabbitt’s estate. He had handled his father and the solicitors and had dealt with KK Lawyers in Suburb LL. He thought they could provide the relevant documents (this was part of the process whereby I essentially insisted that the documentation be made available). The husband conceded that Mr N Mabbitt had been given $15,000 on 15 November 2020 and a further $14,000 on 6 November 2020. The husband was unable to recall a possible further $20,000 in August 2020. It would not have been paid without his knowledge. He conceded that he had thought that the wife waited until she found out about his brother’s inheritance before leaving. She had said to him, “You should inherit, not your father, because he is too old.”
When it was put that his wages from Mabbitt Pty Ltd were treated as a loan, the husband said part of it was. Mr K Mabbitt had loans when he died. When it was asked if these had been paid, the husband said if they had not been, they would probably transfer to Q Pty Ltd. He leaves the accountant’s work to the accountant. When asked if these loans devalued the business, the husband gave no direct answer. He referred to his brothers and said it was all covered by the trust. He conceded that JJ received $5,667 per month and still does. When asked why this was paid, he said it was a combination of director’s loans, distributions, and management fees. Mr N Mabbitt gets the same. Mr K Mabbitt got the same. His father is paid $800 a week, and that is income. They give it to him gross, and he works it out with his accountant.
His father does not physically work in the company. He is there once a week. He gets them business. He is involved in major decisions, not the minor stuff. Leasing is not a big thing.
The husband has a cleaner at home whom he pays. He does not have a cook. Sometimes the cleaner prepares food. He pays her $150 to $200 per week.
When asked about the sale of Company MM, the husband said that in about 2015, JJ bought $30,000 worth of gold. There was no way he could pay his legals, and he had to sell it. He sold it for value.
There was no re-examination.
The Evidence of Mr N Mabbitt
Mr N Mabbitt adopted his affidavit and confirmed that the affidavits of his brother and father were true and correct.
Under cross-examination, Mr N Mabbitt said he had read their affidavits in the last week. He had read them when he swore his affidavit. He was at home. He had been given copies of the affidavits by Ms HH, who is the bookkeeper for Mabbitt Pty Ltd.
Mr N Mabbitt was asked about varying the trust to a fixed trust. He said after Mr K Mabbitt passed, in January 2017, he and his father sat down and went to Mr EE. Mr EE made it clear that this could not just be cleaned up. His father was not even on the documentation. Mr N Mabbitt said this blew him away, as he thought his father owned the whole thing. His brother died and was buried a few weeks later. It was straight after that. He always thought his father was the trust. It started with him. His father made the decisions to buy the properties.
At the start, it was his dad’s money and then through loans. The loans were paid through Mabbitt Equities Pty Ltd Trust. He was not a guarantor. His father would fund it through the business. It would pay through Mabbitt Pty Ltd. His father is the face of the business. At age 87, he still brings a lot of people of the same age. He had spoken to his brother, asking when the court case was. He had been told he would be called up. He had read his brother’s affidavit but did not need to discuss it with him.
They work hard to make money. It is his father’s nest egg. Mr N Mabbitt has been a principal since 1999 and signed to remove Mr K Mabbitt in January 2017. His father had said there was no percentages there. He gave him and his brother a percentage, and he thanks him. Mr K Mabbitt and his dad ran the trust. No decisions are made independently from his father. At the end of the day, he is funding it. He is aware of the wife’s claim. She was saying she should get 50 per cent of what Mr Mabbitt owns.
He always thought the trust was his father and Mr K Mabbitt. If the business needed extra money, he would fund it. It was put that the variation of trust was just to defeat the wife’s claim. Mr N Mabbitt said, “No, not at all.” He did not know she was leaving. He found out she was leaving just after. She and her son Mr H Mabbitt had come to his house. It was civil, and that was when he knew about it. When asked why the asset documents had been filed five days after she left, he did not know. Probate took a long time, and his father went to Country NN in June 2018. There was no re-examination.
Further Evidence from Mr Mabbitt
The husband was recalled by leave following receipt of the documents relating to the administration of Mr K Mabbitt’s estate. He confirmed that an email sent to him was sent to Ms HH, the bookkeeper. He agreed that he was to execute the documents, as a company director. He said the reply reflected discussions between Ms HH and the solicitor, because Ms HH was using his email. He said he was seeing exhibit A1 for the first time. Ms HH was doing all of his father’s work. All the details were between Ms HH and were using company records. He could have been asked questions about them. He had nothing to do with the letters of administration, and this was the first time he had seen it. Ms HH did a lot of work for his father. He did not sign the document. He said he had never seen the probate documents before, and this was the first time he had seen them.
I interpolate and say this is plainly untrue. From the terms of the emails, it is quite apparent that he had seen these documents.
He conceded it was correct that there was no entry relating to Q Pty Ltd. He could not say why there was no such reference. He had relied upon the solicitor’s advice. In re-examination, when asked about transfers to Mr N Mabbitt, the husband said that Mr N Mabbitt did the internet banking. All the amounts went into Q Pty Ltd.
The Evidence of Mr EE
Mr EE adopted his affidavit as true and correct. He has been the accountant of Mabbitt Equities Pty Ltd and the Mabbitt families for 23 years.
Under cross-examination, Mr EE confirmed that he received instructions in 1999 from Mr K Mabbitt and Mr T Mabbitt. He has no notes of those meetings because he does not retain them. They did not accord with the trust deed. This was an error between him, his staff, and the lawyers. He has the original trust deed and could provide a copy to a principal. Normally, this is in storage, but he has it now. The error was not picked up until 2017. There was no reason to review it. The original shareholding was the three brothers – Mr K Mabbitt, Mr Mabbitt, and Mr N Mabbitt – who had equal shares in the trustee company. None were to Mr T Mabbitt. It was a discretionary trust. The principals can vary it to a fixed trust. It was always meant to be 10, 10, and 80 per cent. There were powers of amendment in the trust deed.
When asked about the events in January 2017, Mr EE said that he had taken instructions. He had it done through his online legal services. This is an online subscription. He prepared the instructions to amend. He knew Mr K Mabbitt had died intestate. He believed Mr T Mabbitt also signed. The remaining directors could have signed. The trust deeds were amended to reflect Commissioner of Taxation v Bamford [2010] HCA 10.
When asked why documents were sent to ASIC on 13 August 2018, Mr EE said there was a change of shareholding to reflect the fixed trust. It needed to deal with the trust deed. Mr EE explained how Mr K Mabbitt’s shares went to Q Pty Ltd and produced an 80, 10, 10 result. When asked why there had been so long a delay before the documents were filed with ASIC, Mr EE said there were issues to deal with. They had to bring Mr T Mabbitt into Q Pty Ltd and then deal with the trustees’ shares. He was not aware that the documents were lodged five days after the wife left. He found out later.
He prepares the financials. He always seeks the signatures to prove it all. He did the group’s financials and signed everything up. The change of shares requires signatures. It was not lodged on the instructions of Mr Mabbitt. He recalled being shocked, well after the events, when Mr Mabbitt told him that the wife had left. The change to the trust enhanced the wife’s interest. Previously, it was discretionary. He had always understood Mr T Mabbitt to be the true controller of the trust, the ultimate decision-maker. His intuition was it was Mr T Mabbitt’s retirement funding. He said that they follow up the bookkeeper to get information. He compiles returns from these. Once they are completed and prior to lodgement, he has a meeting with all of them. When asked about Mr T Mabbitt’s involvement in Mabbitt Pty Ltd, Mr EE said it is more left to the boys, but he provides guidance.
Mabbitt Pty Ltd provides a salary and dividends and has been very consistent. There are then director’s loan accounts too. When asked what happened to Mr K Mabbitt’s loans, he said these were rolled over to Q Pty Ltd. Q Pty Ltd replaced Mr K Mabbitt. Interest would be payable on the loans, but there was no prescribed rates. Mabbitt Pty Ltd turns over about $1.4 million, which has been consistent over the years. The properties had loans. There was no regular flow of income from Mabbitt Pty Ltd to Mabbitt Equities Pty Ltd.
In re-examination, Mr EE confirmed that funding had been obtained through loans or funding from Mabbitt Pty Ltd.
The Evidence of Mr T Mabbitt
Mr T Mabbitt adopted his affidavit as true and correct. He is now a pensioner.
It should be noted that Mr T Mabbitt, who is 87, proved unable to be cross-examined in English. He was then questioned through an interpreter, which did improve the matter somewhat. I should say, without any disrespect, that Mr T Mabbitt’s 87 years palpably told upon his capacity to respond directly to questions, and his evidence would need to be approached with some caution accordingly.
Mr T Mabbitt said he signed because it was himself and his wife who started the business. He was at the factory when he signed off. It was himself and the secretary. He did not know her surname. It was given to him to sign, but he read it well and signed it (he was referring, of course, to his affidavit). No one explained the affidavit in Language NN. He first heard he was not in the trust after Mr K Mabbitt died. He was asked if Mabbitt Equities Pty Ltd had properties and agreed. He then gave a description of the properties. He remembered the early properties clearly, but it was apparent (and, of course, I paraphrase) that his memory of the more subsequent purchases was less clear.
When asked how the properties were paid for, he said they were financed through the NAB and always through the trust. When asked how these were paid off, he said this was through the work, which was how they repaid it. This was Mabbitt Pty Ltd. It was all through the earnings of the factory. He spoke to the banks. He could understand English when it was face to face. An agency rented the properties. He negotiated with the agency with his wife. He signed the leases. He did not recall the last time he negotiated with the banks.
When asked how much Mabbitt Equities Pty Ltd owed the banks, he did not remember precisely. He did not remember all the values of the properties they owned, although the Suburb CC property is worth more than $3 million.
When asked who prepared the trust in 1999, Mr T Mabbitt said it was himself, and Mr K Mabbitt went to Mr EE to set up the trust with his money. When asked how much money, he said there were two properties, A L Street. He had sold the properties in Suburb V and bought A L Street. All the other properties were bought with loans except B L Street, which was bought with his money without a loan. He agreed that he was paid a wage out of Mabbitt Pty Ltd, which also pays his children. When asked who decided how much, he said that when they started, they paid the amount established by the government, and this continued.
When asked where the profits of Mabbitt Pty Ltd go, he said that it was to pay debts and common things to do with the factory. When asked what happened to profits after 1999, he said they have properties, which is what they pay the debts with. He agreed that he had retired in 1999 in the sense that he stopped working. He is paid $800 per week as wages and fills out a tax return but has no other income. He disagreed that Mr Mabbitt had more than a 10 per cent interest. He agreed that he had read his affidavit in English and also that Mr EE had prepared it.
Final Submissions by Counsel for the Husband
Counsel said Mabbitt Pty Ltd valuation was not challenged. The loan accounts were taken into account. There cannot be add backs. There was no value in Mabbitt Pty Ltd. The wife’s car value of $10,000 was not disputed. The 10 per cent value of the trust was worth $341,793. If the 10 per cent was set aside, it would only be a discretionary trust. The grandfather placed property into the trust, and there could not be a dollar-for-dollar assessment. Capital gains tax would be paid. The two boys will benefit from the trust.
In 2016, the trust was revisited after the brother’s death. This was before separation. The accountant knew nothing about the separation. The shares were transferred later, but this was not sinister. Probate was granted in March 2018, and the grandparents were overseas. Counsel referred to Harris & Harris [1991] FLC 92-254, Goodwin & Goodwin [1991] FLC 92-192, and Kennon & Spry [2008] 238 CLR 336 (“Kennon & Spry”). There is no history of dividends in this case. Parties agreed for an equalisation of superannuation.
On the question of contributions, there were two properties at the start. Mabbitt Pty Ltd gave an income throughout. This was a financial resource. 10 per cent of Mabbitt Equities Pty Ltd was $345,000, and crystallisation occurred in January 2017. Separation was in August 2018. This was very late in the marriage and was external to the parties.
So far as section 75(2) matters were concerned, the husband’s income and that of the wife were not challenged. There were net assets, as in the husband’s outline at page 8, of $1,512,107. The husband said it should be divided fifty-fifty, and the wife says it should be 65 per cent, but that was too much. In the ultimate, an adjustment of fifty-four and a half percent to the wife was appropriate. The wife may inherit as well as the husband. The appropriate orders were that the husband seeks to keep the matrimonial home and Suburb OO and will pay a lump sum to the wife. He should be given an opportunity to purchase for 90 days.
Final Submissions by Counsel for the Wife
Counsel submitted that Mr T Mabbitt’s evidence should be accepted insofar as it was oral, but the affidavit should be given little weight. Orally, he said he told the accountant to prepare the affidavit. He cannot recall the borrowings. He does not know the properties are worth $8 million. It is an attempt to defeat the husband’s interest in the trust. It started with 10 shares for each brother. The August 2018 documentation shows the movement. Q Pty Ltd got 24 shares.
Mabbitt Pty Ltd had a minus $645 valuation. Mr R’s affidavit, at page 25, suggests that the salaries were $72,914 but should be $150,000. The grandfather says the properties are paid off. Mr Mabbitt says they are paid by rent. This is a form of salary sacrifice, and the wife must have made a contribution to this. When the wife moved out, everything was crystallised in August 2018. She moved to a spare bedroom in 2013. The timing of the asset documentation was critical. The husband has low earnings but still pays $300 a week to a cleaner. He will pay her out through Mabbitt Pty Ltd and Mabbitt Equities Pty Ltd and his family. The wife was a better witness than the husband. The contribution share in the trust was not late. It reflected salary sacrifice benefits to the trust.
So far as section 75(2) matters were concerned, the wife is a sales assistant at Company J. The husband manages a business with a turnover of $1.4 million. There is, in substance, a significant income to the husband. The rental of $63,000 paid by Mabbitt Pty Ltd was more than it should be, according to Mr R. The wife has been cured of cancer and needs to buy a property. She agreed with an equalisation of super. He did not oppose the husband having 90 days with default orders.
So far as setting aside the variation was concerned, he had only received exhibits A1 and A2 yesterday. They show Mr Mabbitt and Mr N Mabbitt signed the instructions to the accountant to remove Mr K Mabbitt. Then Mr T Mabbitt applied for probate. The transfer defeated Mr K Mabbitt’s interests. Mr K Mabbitt’s interests were not declared to the Supreme Court. If the 10 per cent was set aside, it was a discretionary trust. It was 33 per cent. Counsel submitted that this was what the family had done. They had just got on with it. The 65 per cent apportionment of the pool was appropriate without Mabbitt Equities Pty Ltd, but it would be less if it was included.
In reply counsel for the husband submitted that if the marriage was over in 2013, 2017 was a post-separation matter. It was submitted that the grandfather was frail.
Findings about the Credit of the Witnesses
The wife was a good witness. She was composed and answered all questions put to her directly and without equivocation. As I have earlier indicated, her answer about not discussing Mr K Mabbitt’s estate was clearly true. Indeed, she was quite anguished by the suggestion that she left only when she found out about his estate. Notwithstanding this, a level of bitterness (understandable given her view of the matter) towards the husband’s endeavours to defeat her claim was wholly palpable.
The husband was not a good witness. I formed the clear impression that he is, by nature, as I think he said himself, an excitable and voluble person. I accept that that is likely to be the case. Notwithstanding this, however, his answers were, as I have already indicated, on occasion, evasive or non-responsive. He was unduly vague about matters to do with bank loans that I would have expected him to be fully informed of. He failed, on occasions, to answer the question directly and gave non-responsive and prevaricating answers.
By contrast, his brother Mr N Mabbitt was an excellent witness. He answered all questions put to him directly and was plainly telling the truth.
Mr EE was likewise an excellent witness who was clearly telling the truth. I venture to suggest that, as a lawyer, he makes a good accountant. It would appear that the documentation that he prepared in 1999 was seriously remiss. He made no attempt to fudge this, however, and owned up directly.
Mr T Mabbitt is 87. He is of age. I would respectfully hope to be as active as he plainly still is should I be spared to reach such a great age myself. Clearly, however, his answers showed some measure of fixation upon establishing his control and ownership of the trust, and it was quite apparent that he was determined to defeat the wife’s claim, of which it is clear he has at least a sufficient understanding.
Stanford & Stanford (2012) 247 CLR 108 (“Stanford & Stanford”)
The Court’s first task in dealing with property cases is to ascertain the legal and equitable interests of the parties and determine whether a property adjustment is appropriate. Although, necessarily in this instance, it puts the cart before the horse, I can indicate that the proper conclusion to be drawn when the parties’ property interests are ascertained is that there should be a property adjustment. Both parties seek one, in substance, and the basis upon which they conducted their finances as a married couple have plainly come to an end and been radically altered. This brings us, however, to the all-important isMs HH of what the property pool is.
The Property Pool
There are a number of agreed matters as follows:
a)matrimonial home at A Drive, Suburb B, $1,530,000;
b)C Street, Suburb D, $500,000;
c)add back part property settlement to the wife, $30,000;
d)add back part property settlement to the husband, $30,000;
e)add back wife’s withdrawal of cash from joint account, $20,000;
f)add back proceeds of sale of S Pty Ltd investment, husband, $31,180.
Contrary to the carping and mean-spirited position adopted by the husband in relation to the wife’s car with a nominal value of $10,000, I do not propose to include it in the property pool. It has no meaningful resale value. If she sells it, she will have to buy another. She plainly needs a car to get around. I think it is inappropriate to include it. I strongly suspect that the husband must have the use of cars through the family business, in any event. The meanness of spirit involved in trying to achieve some form of adjustment in respect of a matter in percentage terms so small says much about the meanness of spirit in the way the husband has conducted his case.
I do not propose to include the parties’ really fairly tiny amounts in bank accounts, as they seem to me to be either so small as to be not worthy of consideration and/or likely to be post-separation matters.
I am not also going to include the add back sale of the proceeds of the Bitcoin, because it is quite apparent that they were sold for a loss.
The parties’ liabilities are also, to an extent, not controversial. They include:
a)mortgage over Suburb B property, $536,979;
b)mortgage at Suburb D of $137,591.
Additionally, the husband has superannuation of $151,199, and the wife has a combined total of superannuation of $49,948.
This bring us to the crux of the matter.
The Dispute about Mabbitt Pty Ltd and Mabbitt Equities Pty Ltd
Looked at overall, in my opinion, the history of the family business is relatively clear. Mr T Mabbitt bought several properties in Suburb V which he sold, and in 1991, he bought A L Street, Suburb M. His business, Mabbitt Pty Ltd, had been started as long ago as 1975, it would appear, and was primarily moved forward by Mr T Mabbitt and his oldest son, Mr K Mabbitt. A L Street was bought with what was described as a temporary loan, and I have no doubt that by 1999, it had been paid off. The second property, at B L Street, was bought outright by Mr T Mabbitt. The tenor of the evidence generally suggests that those two properties were unencumbered and formed the springboard for subsequent purchases. I accept that that is what has occurred.
Thereafter, all the numerous properties bought by the Mabbitt family, and indeed, including the two previously owned, were placed into Mabbitt Equities Pty Ltd. All of these post 1999 purchases were financed by bank loans. All the L Street properties are apparently unencumbered, as is the property at W Road, Suburb M. It is a little difficult to work out quite where the debts that are said to be related to the other purchases come from, given Mr T Mabbitt’s assertion that at least one Suburb AA properties is unencumbered. But it appears that a number of these properties are tenanted, and that, by and large, the rent pays the loans off.
What is apparent, of course, is that the business model has always been one in which the family operate as a unit. Having seen and heard the parties give their evidence, there is no doubt that Mr T Mabbitt, as the patriarch (with his wife really no more than a cipher, it would seem), has been the man who calls the shots. Mabbitt Equities Pty Ltd was set up, and Mr T Mabbitt put his two unencumbered properties into it. He plainly would not have done this at the retirement age (which is what he was in 1999) if he had not felt that he still had those properties as his own.
This brings us to the question of the corporate structure of Mabbitt Equities Pty Ltd and the Mabbitt Family Trust. Given Mr K Mabbitt’s death, the person with perhaps the most vivid memory of how this was set up is not available to us. Mr EE has said, however, that it was essentially a mistake between him, his staff, and the lawyers. There is no particular suggestion as to exactly by whom, and how, the trust deed was prepared, but if it was prepared, as it may have been, by Mr EE, this may explain the mistake. Nonetheless, I wish to emphasise that I am quite clear in my mind that the failure to include Mr T Mabbitt in any way in the corporate structure of Mabbitt Equities Pty Ltd was no more than an error, albeit a significant one. It did not reflect the reality on the ground.
The reality on the ground was that it was Mr T Mabbitt who had the final and decisive say in any investments that were made. From time to time, one or other of his sons would suggest a property, and he would give the okay to obtain the bank finance, even though it may well have been that Mr Mabbitt and possibly Mr K Mabbitt themselves had a part to play in bidding for the properties and arranging loans and the like. Mr Mabbitt appears to have been in charge of organising the tenancy arrangements. One thing that emerged with complete clarity, however, from the evidence taken overall is that all concerned regarded Mabbitt Equities Pty Ltd as being essentially belonging to Mr T Mabbitt. This was plainly Mr T Mabbitt’s view. It was equally plainly Mr N Mabbitt’s view. Whatever reservations I may have about the husband’s evidence, and I have already expressed them, Mr N Mabbitt’s evidence was given with clarity. It is quite apparent that he and Mr Mabbitt stand in awe of their father. Mr N Mabbitt always regarded the trust as being his father, and indeed, he still does.
Following the tragic demise of Mr K Mabbitt in 2016, he having been, as I accept, the more dominant of the siblings, it must have come as a thunderclap to all concerned when the true legal position was ascertained in early 2017. They promptly set about trying to remedy it. They did so. Mr T Mabbitt gave his two sons a fixed interest of 10 per cent in the trust as a reward for their work – in effect, for him – over the preceding 18 years. Unlike his sons, I do not think this was generous at all. It is quite clear that Mr T Mabbitt ceased work, in any direct sense, in 1999. He obviously came every week, and still does, to the premises, and he plainly is a sort of rainmaker, in the sense that persons from the community of a similar age still provide a certain amount of business.
In truth, however, the business model was that the sons did the work and were paid substantially lower wages than those Mr R felt that they should be properly entitled to. I agree with that assessment. The business model was that they salary sacrificed to enable the purchase and repayment of properties. Even now, the two brothers are paid less than average weekly earnings, an extraordinary position for a company with a turnover of over $1.4 million. I accept that COVID has had an effect, but the evidence strongly suggests that the business is still operating, and given its longstanding reputation for quality and its role and its acceptance within the community, there is no reason to suppose it will not resuscitate itself fully.
The evidence appears to suggest that Mr T Mabbitt saw Mabbitt Equities Pty Ltd, to an extent, as a nest egg. That is the position contended for by Mr T Mabbitt and his children. However, I do not accept that that is the case. What it really is is a composite family venture. Mr T Mabbitt is paid $800 per week to live on, which apparently is more than enough, the two sons are paid wages which in many ways equate to much the same, and all the monies available are ploughed into the payment off of the not inconsiderable loans still outstanding on Mabbitt Equities Pty Ltd investment properties. Clearly, there is a common intention to gradually defray the loans and secure the Mabbitt Equities Pty Ltd property portfolio for the future.
No one has sought to elicit from Mr T Mabbitt what he proposes to happen to his property interests when he dies, but clearly, his properties will pass to his children. As I have observed during the currency of the proceeding, given the facts and circumstances of this case, any endeavour by Mr T Mabbitt to leave the investment properties to anyone else would unquestionably give rise to what would seem on its face to be an extremely strong argument, along constructive trust lines, by the two sons.
As I find, no one in the Mabbitt family has turned their minds in any considered fashion to exactly what the ultimate outcome should be. None of them have really deposed to this effect. If the properties of Mabbitt Equities Pty Ltd are to be a nest egg for Mr T Mabbitt, why on earth are they not being realised now that he is 87 years old. Of course, this is not what they are for. They represent a family operating as a unit to improve their overall circumstances, and of course, very commendably so. In the fullness of time, the fixed 10 per cent interest, in my view, is highly likely to devolve to something more akin to an equal share between the two surviving brothers.
This brings us back to the 2017 process. It was, of course, amended at the direct will of Mr T Mabbitt to reflect what Mr T Mabbitt thought was appropriate. The wife’s contention that prior to that, there was in effect a 50 per cent vested interest in favour of the husband and his brother (and one-third prior to the death of Mr K Mabbitt) is plainly unsustainable. The trust deed was a discretionary trust, and to go back to the now perhaps antiquated pre-Kennon & Spry position, it is well established that a beneficiary in such circumstances has no present entitlement to the property of the trust, and has as French C.J put it in Kennon & Spry at p393 “the right to compel the trustee to consider whether or not to make a distribution to him or her and to the administration of the trust”. In final submissions, counsel for the wife suggested the Court should do what is just, and of course, that is correct, but the Court cannot simply ignore the law. Prior to 2017, the fact is that the husband and the wife had one-third of the corporate ownership of Mabbitt Equities Pty Ltd but no entitlement to any of its properties as a matter of law. In practice, however, Mr T Mabbitt was the owner of the trust.
Of course, the way in which the Mabbitt family went about effecting the changes in 2017 was unlawful. It is plain that the transfer of Mr K Mabbitt’s interests to his parents before letters of administration were reached was not a lawful exercise of authority. It is clear from the exhibit A2 and the inventory of assets that the shareholdings that Mr K Mabbitt’s estate owned were not declared to the Supreme Court. This, of course, was because they were unlawfully previously transferred to Mr T Mabbitt and his wife. This irregularity, however, startling as it is to a lawyer, arises from Mr EE’s self-help as a lawyer and lack of sufficient legal understanding. There is nothing sinister about it.
Similarly, the final notification to ASIC upon which the wife places such emphasis is not sinister at all. The evidence both of Mr N Mabbitt and of Mr EE was that they did not know that separation had occurred in 2017, and plainly, this is true. There is, of course, a contiguity between the wife’s final separation and the documents in ASIC, and it may well be that that last step was activated, perhaps, by that separation. But in the end, however, it should be noted that there had been substantial delays in obtaining probate, but Mr T Mabbitt and Ms D Mabbitt had been overseas, and on balance, I think it is just an unfortunate coincidence that the timing was as close as it was.
It should also be noted, and this is something I have not been able to put into the narrative at an appropriate point thus far, that the properties upon which Mabbitt Equities Pty Ltd owes money are paid in part by rent, but it is quite apparent that Mabbitt Pty Ltd stands as the rescuing cash cow should it be necessary. That is the burden of the evidence given by the Mabbitt parties, and it is quite clear – and I repeat yet once again – that they operate as a family unit and just get on with it.
Accordingly, and for these reasons, the husband and wife’s interests in Mabbitt Equities Pty Ltd can only be included as to the conceded amount of some $341,793.
There is more, however, to be said about the Mabbitt corporate structure. Included in the value of Mabbitt Pty Ltd is an $83,000 debt owed by Mr Mabbitt and his wife to the company. That is said to devolve, according to Mr R, from a loan made by Mr K Mabbitt. Self-evidently, this loan therefore predates 31 December 2016. There is no indication that any interest has been charged or that any steps have been taken to realise that loan. As administrators of Mr K Mabbitt’s estate, Mr T Mabbitt and Ms D Mabbitt should have called that debt in. It was no doubt owing when Mr K Mabbitt died.
In truth, these loans are just book entries. Although the husband has sought to depose that his trustee company’s loan from Mabbitt Pty Ltd reflects monies loaned to them to purchase the property in Suburb B, the figures do not match in any meaningful way. These loan accounts are part and parcel of the smoke and mirrors that so often seem to afflict company accounts in intrafamily matters. Having said this, however, it is simply not possible to set these loans aside, as they have been accepted by the independent expert, whose evidence was not challenged.
What I would say in passing – and at the risk of tedious repetition – that it is all part of the way in which the Mabbitt family as a unit operate. I strongly suspect that the loans in the company’s books will never be required to be repaid. There is nothing to suggest they will be. Nonetheless, it is better to approach this otherwise impenetrable area of difficulty when one comes to the question of what the Mabbitt family holdings constitute in terms of a resource to the husband.
Contribution Issues
It seems to be conceded between the parties that the parties’ contributions were equal over the long course of this relationship. It is plain that although there was something of a period of difficulty in about 2009, at or about the time of the wife’s father’s death, this was overcome. The wife moved into a separate bedroom in 2013, but even on her case, the parties presented themselves to the world as a couple until final separation. Indeed, a part of her evidence given with particular emphasis was her conclusion that the husband simply did not care for her when he forgot her birthday in February 2018, and that this propelled final separation.
The husband’s evidence about separation was far more nuanced than that of the wife, and he appeared to be vaguely hopeful of reconciliation even until she finally left. This is not a divorce application, and it is not necessary for me to make an absolute finding as to when separation in that sense occurred. It appears to have been that the relationship went from a cessation of intimacy in about 2013 through a long slide to the final separation in 2018. To describe events in the meantime as either pre- or post-separation, in my view, is artificial and unrealistic.
In these circumstances, it is appropriate to treat the entirety of the period from 1992 to 2018 as the one with which one is concerned. While the husband always worked for the family business, albeit at an underpayment of wage, he always provided. The wife worked from time to time, and of course, bore the four children, for whom she had the primary home raising responsibilities. In the circumstances, it is not necessary to say very much more. The parties appear to me to concede that the contributions are generally equal, and I accept that that is so.
Future Needs
The husband is paid about $64,000, and the wife is paid about $38,000. The wife’s evidence is that at her age and as a sales assistant at Company J, what she now earns is likely to be the most she will ever earn, and indeed, if her employment is lost in that capacity, she may well struggle to get anything else. I entirely accept that evidence, which is cogent.
The wife’s health is presently good but has the uncertainty of her serious cancer illness at an earlier time. There is no evidence that causes me to be able to assert that either her life expectancy or employment prospects will, however, be materially affected by this most unfortunate history.
The husband is in unexceptional health and has what, if there is such a thing as secure employment anywhere, secure employment. He is the salesman and administrator of a very long-established business which has a history going back to 1975 and a turnover in ordinary times of in excess of $1.4 million on an ongoing basis. He is part of the family, and it is a family business. He will always earn a little short of twice as much as the wife.
This reduced salary, of course, reflects a measure of salary sacrifice, and I have not commented in the contribution issues, as I should have done, that the reduced standard of living that this gave rise to necessarily involves credit to the wife also and goes to buttress the equal contribution finding that I have made.
Where the husband’s case, in my view, runs into very significant difficulties is the question of the extent to which the Mabbitt Pty Ltd and Mabbitt Equities Pty Ltd stand as a resource to the husband. It is the husband’s final proposal that he pay out the wife 54.2 per cent of the net asset pool, as construed by him. Additionally, he would have to take over the payment of the mortgages, which amount to in excess of $650,000. The resultant total is well over $1 million. Plainly, no bank will be able to advance him anything like sufficient to begin to meet that debt.
This being so, the obvious and indeed only conclusion one can reach is that the husband has very significant financial resources at his disposal. Whether, as one might expect, Mabbitt Equities Pty Ltd raises further loans, or whether, for that matter, Mabbitt Pty Ltd in some fashion comes up with the money, the reality is that the husband has hundreds of thousands of dollars at his command. This is not some future or vague entitlement; it is present now. It is not dependent upon the passing of his parents and his inheritance, as I have no doubt will be the case, together with his brother, of the Mabbitt Pty Ltd and Mabbitt Equities Pty Ltd.
This contrasts markedly with the wife’s likely future inheritance. True it is that it appears that she and her siblings will inherit seven-figure sums when her mother dies, but her mother is still alive, and there is no evidence that her demise is in any way imminent.
In terms of future needs, the husband has infinitely more resources available to him than the wife. As he correctly himself has deposed, the wife will be able to buy a modest property out of what she gets from this matter, and her capacity to borrow is obviously going to be extremely limited. He proposes that he end up with the matrimonial home, described by both parties as their dream home, and the holiday home in Suburb OO.
The end result of this case will likely be the husband having the two properties the parties owned with loans no doubt taken out at least as beneficently as possible from his family and possibly, to a lesser extent, from banks.
The wife seeks a 15 per cent adjustment under this heading. In my view, that is slightly excessive. Likewise, the husband’s position is unduly parsimonious. I think the wife should receive 62 per cent, a 12 per cent adjustment in respect of future needs.
Just and Equitable
In the particular and difficult circumstances of this case, in my view, an overall result that gives the wife 62 per cent of the pool as I have found it is indeed a just and equitable one, and I have drawn orders accordingly.
I certify that the preceding one hundred and sixty eight (168) paragraphs are a true copy of the reasons for judgment of Judge Burchardt
Associate:
Date: 7 April 2021
SCHEDULE
The pool:
Matrimonial Home
$1,530,000
C Street, Suburb D
$500,000
Part Property Settlement Wife
$30,000
Part Property Settlement Husband
$30,000
Addback S Pty Ltd Investment
$31,180
TOTAL:
$2,121,180
Less:
Mortgage Suburb B
$536,979
Mortgage Suburb D
$137,591
$1,446,610
$1,446,610 x 62% = $896,898
Key Legal Topics
Areas of Law
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Family Law
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Equity & Trusts
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Property Law
Legal Concepts
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Fiduciary Duty
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Constructive Trust
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Remedies
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Jurisdiction
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Reliance
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