Mason v Hamer

[2001] NSWSC 802

Reported Decision: (2002) DFC 95-242

New South Wales

Supreme Court

CITATION:	Mason v Hamer [2001] NSWSC 802 revised - 13/11/2001
FILE NUMBER(S):	SC 11913/01
HEARING DATE(S):	3 September 2001
JUDGMENT DATE:	13 September 2001
PARTIES :	Mark Raymond Mason Dianne Patricia Hamer
JUDGMENT OF:	Sully J at 1

LOWER COURT JURISDICTION :	Local Court
LOWER COURT FILE NUMBER(S) :	FL004/08
LOWER COURT JUDICIAL OFFICER :	Stephen Jackson LCM

COUNSEL :	E. Cox - Plaintiff A. Henskens - Defendant
SOLICITORS:	Self- Plaintiff Berryman Partners - Defendant
LEGISLATION CITED:	Local Courts (Civil Claims) Act 1970 (NSW) Property (Relationships) Act 1984 (NSW)
DECISION:	Orders made by Local Court confirmed; Amended Summons dismissed with costs.

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IN THE SUPREME COURT
OF NEW SOUTH WALES
common law division

11913/01

SULLY J

Mark Raymond MASON v Dianne Patricia HAMER

JUDGMENT

1 HIS HONOUR: By an amended summons filed by leave in Court at the commencement of the hearing in this Court Mr. Mark Raymond Mason as plaintiff claims against Miss Dianne Patricia Hamer as defendant the following relief:

“1. Leave to appeal from the whole of the judgment of the Local Court at Newcastle on 24 May 2001 be granted.
2. That the orders of the Local Court at Newcastle made on 24 May 2001 be set aside.
3. That judgment be entered in favour of the Plaintiff in the proceedings in the Local Court at Newcastle.
4. Costs.
5. Such order as this Honourable Court thinks fit.”

2 The decision of the Local Court to which the amended summons refers was given in the exercise of a jurisdiction conferred upon the Local Court by the Local Courts (Civil Claims) Act 1970 (NSW). By reason of section 69 of that Act, all such judgments of a Local Court are final and conclusive with the one exception that a party who “is dissatisfied with the judgment or order of the court as being erroneous in point of law, may appeal to the Supreme Court therefrom”.

3 Three particular grounds of appeal were notified in compliance with the requirements of SCR Part 51B Rule 8. They are:

“1. That the Magistrate erred in inferring that the Defendant contributed in excess of $40,000.00 to the Plaintiff’s Bolwarra property, such inference being neither supported by any evidence nor open on the evidence.
2. That the Magistrate erred in assessing the Plaintiff’s contributions by reference to only his economic contribution, and failed to have regard to the Plaintiff’s non-financial contributions to the property and relationship.
3. That the Magistrate erred in failing to pay regard to s 19 of the Property Relationships Act 1984 (NSW) in that the orders made impose a continuing financial relationship on the parties.”

4 The judgment given in the Local Court was given in proceedings in which Miss Hamer claimed against Mr. Mason relief pursuant to the Property (Relationships) Act 1984 (NSW). The objects of that Act, as described in the long title to the Act, are the making of “provision with respect to the rights and obligations of persons in certain domestic relationships”. At all material times Mr. Mason and Miss Hamer were living in what used to be described conventionally as a de facto relationship. Such a relationship comes within the purview of the Act.

5 Section 3 of the Act, the definitions section, includes the following definitions which are of particular relevance for present purposes:

“ financial resources, in relation to parties to a domestic relationship, or either of them, includes:
(a) a prospective claim or entitlement in respect of a scheme, fund or arrangement under which superannuation, retirement or similar benefits are provided,
(b) property which, pursuant to the provisions of a discretionary trust, may become vested in or used or applied in or towards the purposes of the parties to the relationship or either of them,
(c) property, the alienation or disposition of which is wholly or partly under the control of the parties to the relationship or either of them and which is lawfully capable of being used or applied by or on behalf of the parties to the relationship or either of them in or towards their or his or her own purposes, and
(d) any other valuable benefit.
Property , in relation to parties to a domestic relationship or either of them, includes real and personal property and any estate or interest (whether a present, future or contingent estate or interest) in real or personal property, and money, and any debt, and any cause of action for damages (including damages for personal injury), and any other chose in action, and any right with respect to property.”

6 Also relevant for present purposes are the provisions of sections 19 and 20 of the Act.

7 Section 19 provides:

“ 19 Duty of Court to end financial relationships
In proceedings for an order under this Part, a court shall, so far as is practicable, make such orders as will finally determine the financial relationships between the parties to a domestic relationship and avoid further proceedings between them.”

8 Section 20 provides, relevantly:

“ 20 Application for adjustment
(1) On an application by a party to a domestic relationship for an order under this Part to adjust interests with respect to the property of the parties to the relationship or either of them, a court may make such order adjusting the interests of the parties in the property as to it seems just and equitable having regard to:
(a) the financial and non-financial contributions made directly or indirectly by or on behalf of the parties to the relationship to the acquisition, conservation or improvement of any of the property of the parties or either of them or to the financial resources of the parties or either of them, and
(b) the contributions, including any contributions made in the capacity of homemaker or parent, made by either of the parties to the relationship or to the welfare of the family constituted by the parties and one or more of the following, namely:
(i) a child of the parties,”

The course of the hearing before this Court reduced to a very small compass the matters requiring adjudication by this Court. A useful starting point for the discussion of those matters is Exhibit B, which is a document in the following form:

Defendant’s submission on quantum of contribution
Hamer ats Mason


Amount $ Paragraph of Defendant’s affidavit sworn 17/8/00

3000 17(a)

1000 17(e)

390 20

10 050 21

16 400 24

1 500 25

6 893.89 26


3 035.91 27

254 27

601.13 27

======

43 124.87 (sic) 29

9 It was not disputed at the hearing before this Court that the evidence in the Local Court was sufficient to support findings of fact that Miss Hamer had in fact expended during the course of her relationship with Mr. Mason the amounts of money to which reference is made in Exhibit B. It was contended, however, that the evidence in the Local Court respecting the three items of, respectively, $10,050, $16,400 and $1,500, could not support a finding that Miss Hamer had expended those amounts in circumstances rendering the expenditures contributions to the relationship in any of the senses contemplated by the relevant provisions of section 20 of the Property (Relationships) Act.

10 The item of $10,050 is first raised in paragraph 21 of an affidavit sworn by Miss Hamer on 17 August 2000. In that paragraph Miss Hamer deposes to the fact that she made on four nominated dates repayments of what she describes as Mr. Mason’s “personal loans to his brother, Ian Mason,………….”; the total of the four payments being $10,050. Mr. Mason swore an affidavit on 17 August 2000. His affidavit is very lengthy, running to some 139 paragraphs occupying 20 pages. Mr. Mason’s affidavit does not seem to me to deal in any particular way with the contents of paragraph 21 of Miss Hamer’s affidavit. Paragraph 85 of Mr. Mason’s affidavit speaks of a borrowing of $8,000 from his brother; but that is the only reference which I can find in that affidavit to any of the particular matters of which Miss Hamer speaks in paragraph 21 of her own affidavit.

11 At the hearing in the Local Court Mr. Mason was cross-examined briefly about the particular items totalling $10,050. That evidence is as follows:

“Q. ……….. You see you agree it’s the case don’t you that during the course of the relationship Ms Hamer paid out some loans for you?
Q. And one of those loans was the loan that you’ve already conceded was $16,400. Is that right?
A. Yes
Q. There was also a loan paid at the same time to your father for $1,500?
A. Yes.
Q. And the earlier loans that were paid on behalf of your brother amounted to $10,000 didn’t they?
A. Yes there’s one that I recall that’s $8,800. I don’t recall the other three.
Q. If it was suggested by Ms Hamer that it was in fact $10,050, would you accept that?
A. Well no, I can remember the $8,800. The other three smaller ones I can’t remember them at all.
Q. Well certainly there was one for $8,800?
A. Yes.
Q. So there may be a difference of a few hundred dollars, we may be talking about a difference of a few hundred dollars then?
A. I can definitely remember the $8,800.
Q. Well in fact $1,200, some $1,200?
A. I can’t remember the other three payments, I can remember the $8,800, I can’t remember the other three payments.
Q. So you certainly concede $8,800?
A. Yes.
Q. You concede $1,500 and you concede $16,400, that right?
A. Yes.” [T 75, 76 of 4.12.2000]

12 As to the payment of $16,400, Miss Hamer deposes in paragraph 24 of her affidavit that she paid that sum on or about 15 October 1997 to the respondent’s brother, Ian Mason, “in reduction of a personal loan between …………….(Mr. Mason) ………… and his brother”.

13 As to the item of $1,500, Miss Hamer deposes in paragraph 25 of her affidavit to having made that payment on 13 November 1997 “to Ray Mason, being ………….(Mr. Mason’s father)……… in reduction of another loan of ………..(Mr. Mason)”.

14 As is clear from the excerpt earlier herein quoted from the trial transcript in the Local Court, Mr. Mason does not dispute that Miss Hamer made these payments out of her separate property.

15 As to all three of the amounts of $10,050, $16,400 and $1,500, the submissions now made for Mr. Mason are put succinctly in the following excerpts from written supplementary submissions put in on his behalf:

[1] Notwithstanding there is no dispute that payment was made to Mr. Mason’s brother and father, there is no evidence as to the terms on which those payments were made: ……………… .
[2] The evidence adduced before the Magistrate does not permit a finding that the payments were intended by the parties to be a loan by (Miss Hamer) to (Mr. Mason). Similarly no evidence was adduced by either party of the terms on which (Miss Hamer) made these payments which would exclude the conclusion that the payments were a gift by (Miss Hamer). Accordingly, it is submitted that the only finding this Court can make is that (Miss Hamer) made payments of $10,500 (sic) ($10,050) and $16,500 ( sic) to (Mr. Mason’s brother) and $1,500 to (Mr. Mason’s father) in repayment of loans to third parties, but no more.”

16 Relevant to these submissions are the following passages from the cross-examination of Miss Hamer by the solicitor then representing Mr. Mason:

“Q. But certainly at a couple of points during the relationship you did pay out some debts for him didn’t you?
A. Yes.” (T 22 of 4.12.2000)

17 And, a little later:

“Q. ………………I think we then go over to paragraph 24 or 25. You made a payment of $16,400 to Mr. Mason’s brother, Ian?
A. Yes.
Q. And that was in respect of a debt that you were aware that Mr. Mason owed to his brother?
A. Yes.
Q. You also paid a sum of $1,500 to Mr. Mason’s father?
A. I did.
Q. Ray Mason?
A. That’s right
Q. And that was also in respect of a debt that you were aware that Mr. Mason owed to his father?
A. Yes.” [T 24, 25 of 4.12.2000]

18 It seems to me that the purport of the whole of the foregoing evidence is completely clear. Mr. Mason owed amounts of money to his brother and father. He was unable to repay those amounts to his brother and father out of his own resources. Miss Hamer paid the amounts for him. He, accordingly, was relieved of any continuing obligation to pay his brother and his father out of his own resources. I cannot see how it can be sensibly disputed that the benefit thus conferred upon Mr. Mason at the instance of Miss Hamer was a “valuable benefit” as contemplated by paragraph (d) of the statutory definition of “financial resources”. The payments made by Miss Hamer were, in my opinion, clearly financial contributions made by her to his financial resources. As such, the payments fall, in my opinion, and fall clearly and distinctly, within the provisions of section 20(1)(a) of the Property (Relationships) Act. I reject the submissions to the contrary.

19 It is necessary, next, to look at some particular criticisms made by learned counsel appearing for Mr. Mason of certain passages in the judgment of the Local Court.

20 At pages 3 and 4 of the judgment the following appears:

‘Following the sale of (certain real estate admittedly owned by Miss Hamer as part of her separate property)……………she paid out various amounts which totalled $25,500 directly attributable to (Mr. Mason’s) Bolwarra property or in reduction of loans made to (Mr. Mason) in connection with that property. Thus over the period of cohabitation she made contributions by way of cash injection to the respondent’s interest of not less than $42,000.”

21 It is submitted that the evidence cannot support a finding that payments totalling $25,500 were made by Miss Hamer as payments referable, whether directly or indirectly, to Mr. Mason’s property at Bolwarra. Even if it were now to be found by this Court that the references by the Local Court Magistrate to the Bolwarra property were misconceived in fact, that would not seem to me to call for any intervention by this Court, for the reason that the concluding sentence in the previously quoted paragraph of the Local Court judgment makes a finding of fact which is not only supportable on the evidence placed before the Local Court, but is not now disputed, save only to the extent of the point of law which I have previously discussed in connection with the three items of $10,050, $16,400 and $1,500.

22 At pages 5 and 6 in the Local Court judgment, the learned Magistrate canvasses a matter as to which there was a great deal of dispute at the hearing in the Local Court. Central to Mr. Mason’s case in the Local Court was that he had performed a great deal of extremely valuable work upon a house owned by Miss Hamer as part of her separate property. The learned Magistrate found, put simply, that such work as had been carried out by Mr. Mason, if valued in dollar terms correctly, had not resulted in a real increase in the market value of the property of any greater amount than about $7,000 over a period of six years. The learned Magistrate reached the conclusion that “the increase in value of the property because of inflation and the work was only about $7,000”. As to any apportionment of that figure of $7,000, the learned Magistrate came to these conclusions:

“It is not really possible on the evidence to distribute that increase in value as between the parties, as part of the work was paid for by (Miss Hamer) and she contributed some labour, there was a greater contribution of labour by( Mr. Mason), but there must have been as I have already noted some inflationary factor. The best I can do is allocate on a rule of thumb basis one-third to the contributions of each of the parties, and apportion the remaining third to inflation, the benefit of which the applicant receives. Thus (Mr. Mason’s) contribution in money terms to the acquisition, conservation or improvement of (Miss Hamer’s) property is not the $35,000 to $40,000 which he claims, but about $2,300.”

23 A reading of the trial transcript of the hearing before the Local Court, and of the affidavits of the parties, makes plain that the proceedings in the Local Court were fought out in minute and bitter detail. In such a setting, I do not think that it can be said reasonably that the learned Magistrate fell into any appellable error of law by reason of his Worship’s approach to the allocation as between the contending parties of the amount of $7,000 with which his Worship was dealing in particular in that part of the judgment previously quoted.

24 It is necessary, next and finally, to consider the point taken in the third ground of appeal.

25 In order to deal with this point, it is necessary to understand that the learned Magistrate made an order that Mr. Mason pay to Miss Hamer $31,000. The evidence before the Local Court established clearly that Mr. Mason had no hope of making an immediate cash payment of $31,000 out of such resources as were then available to him. His principal asset was a house property at Bolwarra. The evidence established that such property was in an uncompleted state of construction; but that were its construction to be completed, the probabilities were that the property would have a market value in the order of $20,000 more than its value in an uncompleted state. The learned Magistrate took the view that the practical way of giving effect to his Worship’s order for the payment of $31,000, was to give Mr. Mason a reasonable time within which to finish the construction of the Bolwarra property, and then to sell the property. His Worship considered that it was necessary to give Mr. Mason some incentive to get on with completing and selling the property; and that “a moratorium on interest for a period might be one way of urging him to do that”. To those ends, his Worship made a formal order that Mr. Mason pay to Miss Hamer the amount of $31,000 within 12 months “of the date upon which a final decision is recorded”. His Worship ordered that no interest be payable on the amount of $31,000 for a period of six months, “but that after that time interest accrue on any outstanding balance of the amount ordered to be paid at a rate equivalent to the then current rate, or if it varies, the current rate, being paid by the applicant for her mortgage plus 3 percent”.

26 It is true, as is now submitted by learned counsel for Mr. Mason, that the duty of the Local Court was to bring to an end the financial relationships previously existing between Mr. Mason and Miss Hamer. It is, however, equally true that the Local Court, in carrying out that statutory duty, is enjoined by the statute to have regard both to what is “practicable” (section 19); and to what is “just and equitable”, having regard to the requirements, relevantly, of section 20(1)(a).

27 In thus bringing to an end the antecedent financial relationships of Miss Hamer and Mr. Mason, the Local Court Magistrate was confronted, as I respectfully think, with a situation, the practicable, just and equitable resolution of which required the framing of final orders which not only complied with the bare requirements of sections 19 and 20; but did so with practical common sense, having regard to, in particular, a realistic assessment of the capacity to pay of the party ordered to pay. In my opinion it has not been established that the approach taken by the learned Magistrate failed to do what was required of his Worship by sections 19 and 20.

28 For the whole of the foregoing reasons, I have come to the conclusion that the challenge now made to the judgment of the Local Court has not been sustained.

29 The orders made by the Local Court are confirmed. The amended Summons is dismissed with costs.

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Last Modified: 11/13/2001