Massey and Massey and Anor (No. 3)
[2007] FamCA 1502
•30 November 2007
FAMILY COURT OF AUSTRALIA
| MASSEY & MASSEY AND ANOR (NO. 3) | [2007] FamCA 1502 |
| FAMILY LAW – PROPERTY SETTLEMENT – Section 79 Property Orders – Child Support – Intervention by Australian Taxation Office – Identification of pool of assets – Valuation of wheat and barley crop – Whether a crop is property or its proceeds upon harvest are income – Legal fees and if they are to be repaid to the pool of assets – Standard of Proof – Observation of witnesses – Assessment of contribution factors – Assessment of s75(2) factors – Substantial other debts and liabilities – Sale of farming lands to satisfy orders and liability to intervenor – Just and equitable division of property |
| Briginshaw v Briginshaw (1938) 60 CLR 336 at 361-2 Family Law Act 1975 (Cth) s 4; s 75(2); s 79(2); s 79(4); s 106A |
| APPLICANT: | MRS MASSEY |
| RESPONDENT: | MR MASSEY |
| INTERVENOR: | THE DEPUTY COMMISSIONER OF TAXATION |
| FILE NUMBER: | MLF | 2141 | of | 2005 |
| DATE DELIVERED: | 30 November 2007 |
| PLACE DELIVERED: | MELBOURNE |
| PLACE HEARD: | MELBOURNE |
| JUDGMENT OF: | YOUNG J |
| HEARING DATE: | 24, 25 AND 26 October 2007 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | MR WOOD |
| SOLICITOR FOR THE APPLICANT: | PEARSONS SCHETZER & ASSOCIATES |
| COUNSEL FOR THE RESPONDENT: | MS SMALLWOOD |
| SOLICITOR FOR THE RESPONDENT: | GARDEN & GREEN |
| COUNSEL FOR THE INTERVENOR: | MR THOMSON |
| SOLICITOR FOR THE INTERVENOR: | ATO LEGAL SERVICE BRANCH |
TABLE OF CONTENTS
ORDERS
ISSUE
APPLICATIONS
AFFIDAVITS
BACKGROUND FACTS
PREVIOUS ORDERS (A Summary)
STANDARD OF PROOF
OBSERVATION OF WITNESSES
FAMILY LAW ACT 1975 (CTH), S.79 AND RELEVANT CASE LAW
SECTION 75(2) FACTORS
INITIAL PROPERTY CONTRIBUTIONS
INHERITANCES AND PRE-COHABITATION CONTRIBUTIONS
INTERVENOR – HUSBAND’S TAXATION LIABILITY
POOL OF ASSETS, RESOURCES AND LIABILITIES
THE WIFE
MR L
HUSBAND
FARMING LANDS AT W
ACREAGE
SALE OF FARMING LANDS
M PROPERTY
S PROPERTY
COMMONWEALTH BANK OVERDRAFT - WIFE
COMMONWEALTH BANK OVERDRAFT – HUSBAND
PLANT AND EQUIPMENT
LIVESTOCK
CROP VALUATION
VALUE OF CROPS
LEGAL COSTS
CAPITAL GAINS TAX AND TAX LOSSES
B FINANCE
FINAL NET ASSET POOL
MONIES RECEIVED BY WIFE
SPOUSAL MAINTENANCE AND OTHER PAYMENTS
CHILD SUPPORT
SECTION 75(2) FACTORS
OUTCOME
MONIES AVAILABLE TO HUSBAND TO SATISFY ORDERS
MONIES TO BE PAID TO INTERVENOR
OTHER LIABILITIES TO BE PAID BY HUSBAND
MONETARY EFFECT OF ORDER
FOURTH STEP
MONIES TO BE PAID TO WIFE
SECTION 106A
ORDERS
THAT all prior partial property, maintenance and financial orders be discharged.
THAT the husband forthwith sign all documents and do all acts and things necessary to sell the properties of 1,100 acres known as “[C Property]” and being the whole of the land more particularly described in Certificate of Title Volume … Folio … and Folio … (Crown Allotments [1] and [2]) subject to the following terms and conditions:
(a)the properties be offered for sale (jointly or individually) prior to 22 December 2007 with a settlement date scheduled no later than 28 March 2008;
(b)the sale(s) be on an unconditional contract basis and for the best available price;
(c)the husband have the conduct of sale(s) but the selling agent is to be Mr S of L Real Estate and the solicitors for the husband, wife and Intervenor are to be kept fully informed of all offers, discussions and issues concerning each of the properties and the proposed sale(s) price thereof;
(d)the reserve price is to be $385,000 or individually $192,500 each;
(e)the wife is to ensure that, at her expense, the caveats lodged by her and encumbering each of the titles are withdrawn prior to settlement.
THAT upon settlement the proceeds of sale of C property be applied as follows:
(a)in payment of all reasonable and proper costs, commissions and expenses of sale(s);
(b)in payment of any arrears of rates, taxes and outgoings;
(c)in payment to the Intervenor of a sum of $280,000;
(d)in payment of a sum of $40,000 to the wife;
(e)in payment of the balance or such lesser sum as the husband may then negotiate to the Rural Finance Corporation in partial reduction of its mortgage security held over all of the farming properties owned by the husband.
THAT by early February 2008 a clearance sale be held to realise all of the plant and equipment identified in the Certificate of Valuation prepared by Mr BL and which is annexure “IBL2” to his affidavit filed 20 August 2007.
THAT the husband, by himself, his servants or agents be and is hereby restrained from removing from any of his properties any item of plant or equipment identified in that valuation and, if any such item is now located elsewhere, it is to be returned forthwith by or on behalf of the husband to the properties or to the location of the clearance sale.
THAT the husband co-operate in all ways and do all acts and things and give all necessary and proper instructions to achieve the best available price on each of the items.
THAT the selling agent for the purposes of the plant and equipment clearance sale be the firm B Company, but not Mr X of that firm.
THAT the reserve price for all such items shall be the valuation sum of Mr BL unless it be otherwise varied by agreement between the husband and wife or as recommended in writing by B Company.
THAT the proceeds of sale of the plant and equipment clearance sale are to be applied as follows:
(a)first to pay all actual costs, commissions and expenses of such sale;
(b)in discharge of the chattel mortgage liabilities owing to D Finance and the Bank of Queensland;
(c)in payment to the Intervenor of the sum of $138,308.17;
(d)in payment to the wife of the sum of $150,000;
(e)in payment of the balance, if any, to the husband.
THAT the husband, his servants or agents be and are hereby required to sell all of the current wheat crop through the Australian Wheat Board and to sell all of his current barley crop through the Australian Barley Board.
THAT from the sale of the barley crop the husband sign all documents and do all acts and things to authorise and direct the following payment(s):
(a)the sum of $10,000 to his former accountants in discharge of the crop lien;
(b)the sum of $150,000 to the Intervenor;
(c)the sum of $60,000 to be paid to the wife;
(d)the balance to be paid to the husband.
THAT from the sale of the wheat crop the husband sign all documents and do all acts and things to authorise and direct the following payment(s):
(a)in payment to the Child Support Agency on behalf of the wife of the sum of $10,000 as the proper sum of child support arrears for the period up to 30 June 2007.;
(b)the sum of $25,000 to be paid to the wife;
(c)the balance to be paid to the husband.
THAT on or before 1 April 2008 (“the due date”) the husband pay to the wife the further lump sum of $105,092 (“the further lump sum”).
THAT in default of payment by the husband to the wife all of that further lump sum by the due date the property known as T property and being the whole of the land described in Certificate of Title Volume … Folio … (Crown Allotment …) be forthwith sold and the husband sign all documents and do all acts and things required to complete the settlement of such sale subject to the following terms and conditions:
(a)the sale be on an unconditional contract basis for the best available price and be settled within a further sixty (60) day period;
(b)the husband have the conduct of sale but the selling agent is to be Mr S of L Real Estate and the solicitors for the wife are to be kept fully informed of all offers, discussions and issues concerning the sale of T property and its proposed sale price;
(c)the reserve price is to be no less than $195,000;
(d)the wife is to ensure that, at her expense, the caveat lodged by her and encumbering its title is withdrawn prior to settlement.
THAT upon settlement the proceeds of sale of T property are to be applied as follows:
(a)in payment of all reasonable and proper costs, commissions and expenses of sale;
(b)in payment of any arrears of rates, taxes and proper outgoings;
(c)in payment to the wife of the balance of the lump sum inclusive of interest to be calculated as and from the due date and to be paid monthly in arrears at the interest rate prescribed from time to time pursuant to the Family Law Rules and to continue until the whole of the further lump sum and all accrued interest is paid in full;
(d)in payment of the balance, if any, to the husband and he to be responsible from that sum to pay any required amount to the Rural Finance Corporation in discharge or proper reduction of its mortgage security.
THAT upon payment of all monies otherwise due and payable by the husband to the wife and the Intervenor pursuant to these Orders the husband then retain sole ownership of all remaining farming land and otherwise identified in these proceedings as properties known as T property (subject to orders 14 and 14 hereof), H property, LS property, LR property and B property.
THAT upon payment to the wife of all monies required to be paid to her pursuant to these Orders the wife then, and at her expense, provide executed withdrawals in proper registerable form for all caveats lodged by her on the remaining farming lands.
THAT the wife otherwise retain her furniture and chattels, her motor vehicle and monies received by her from the sale of the property at S and the $60,000 received by Court Order from the settlement of M property.
THAT the husband otherwise remain solely responsible for all debt, liability and interest owing to the Rural Finance Corporation, his personal Commonwealth Bank overdraft and all arrears of rates and taxes and other liabilities encumbering the other real property to be now retained in his sole name.
THAT the husband be solely responsible for the liability to B Finance Pty Ltd and for that purpose, and aside from any item of plant and equipment to be realised in the clearance sale, he is to retain sole ownership and possession of the four farming discs and the prime mover, subject to the existing repossession order in favour of B Finance Pty Ltd and specifically any balance of liability owing to B Finance Pty Ltd shall be and remain the sole responsibility of the husband.
THAT save for any proper purpose genuinely involved with the collection or delivery of the children of the marriage to and from the wife’s residential property the husband be and is otherwise restrained from entering upon or otherwise travelling in the immediate vicinity of or loitering within 200 metres of the wife’s residence at …, D or otherwise her residential address from time to time thereafter.
THAT unless otherwise specified in these Orders and save for the purpose of enforcing any monies due and payable under these or any subsequent Orders:
(a)the husband and wife be entitled to the exclusion of the other to all other person or property, chattels or possessions as they now own or retain;
(b)each party retain any superannuation benefits or other work related benefits or entitlements owned by them;
(c)insurance policies remain the sole property of the owner thereof;
(d)the husband and wife otherwise be each solely liable for and indemnify the other against any other liability encumbering any item of property, real or personal, to which that party is entitled pursuant to these Orders.
RESERVE liberty to the wife and the intervenor to apply to the Court on proper documentation filed and served upon the husband as to the enforcement of any of these orders.
THAT all extant applications, interim and final, be otherwise dismissed and the proceedings be removed from the list of cases awaiting hearing.
THAT after thirty (30) days all subpoenaed documents be returned by the Subpoenas Clerk, Family Court, Melbourne Registry to the person or organisation who produced same to the Court.
THAT a sealed copy of these Orders be forthwith served upon the proper officer, Child Support Agency, by the solicitors for the wife.
THAT the child support assessment for the period 1 July 2005 to 30 June 2007 be departed from by adjusting the annual rate to a sum sufficient to ensure that as at 30 June 2007 the total sum in child support then owing by the husband is $10,000 and that pursuant to Order 12(a) hereof that sum be paid from the proceeds of the wheat crop to the child support agency on behalf of the wife.
THAT the child support assessment for the period 1 July 2007 to 30 June 2009 (inclusive) for the children M born … March 1994 and MA born … July 1998 be set in the sum of $15,600 per annum (payable as to $7,800 per annum per child) and that such sums be paid by the husband to the wife as follows:
§in the 2007 – 2008 financial year the required sum being paid on or before 1 June 2008; and
§in the 2008 – 2009 financial year the required sum being paid on or before 1 January 2009.
THAT conditional upon the husband making each of these yearly payments as provided for in the preceding Order no penalty payments be charged or be applied to that yearly lump sum payment and I direct pursuant to s 124 of the Child Support (Assessment) Act 1989 the payments for each of these financial years be by lump sum non-periodic payment.
RESERVE liberty to each of the husband and wife to apply if there is any difficulty or issue with the Child Support Agency as to the implementation or enforcement of these Orders for payment of child support.
IT IS CERTIFIED
THAT pursuant to Rule 19.50 of the Family Law Rules this matter reasonably required the attendance of Counsel for all parties.
IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of the Honourable Justice Young delivered this day will for all publication and reporting purposes be referred to as Massey & Massey and ATO
| FAMILY COURT OF AUSTRALIA AT MELBOURNE |
FILE NUMBER: MLF 2141 of 2005
| MRS MASSEY |
Applicant
And
| MR MASSEY |
Respondent
And
AUSTRALIAN TAXATION OFFICE
Intervenor
REASONS FOR JUDGMENT
ISSUE
The husband and wife have been unable to agree upon, and this Court must now identify, the net assets and then determine their just and equitable division together with proper child support arrangements, both as to arrears and ongoing payments. The primary assets are farming land, plant and equipment and a wheat and barley crop offset by substantial agreed liabilities to the Australian Taxation Office and other banks and financial institutions. The dispute centres upon what real and personal property should be sold to discharge or reduce liabilities and what are the s 79(4) contributions and s 75(2) factors that must be evaluated to determine a just and equitable division of property and other proper and necessary consequential orders.
APPLICATIONS
Wife
The initiating application of the wife was filed 7 July 2005 and thereafter she filed amended applications on 3 January 2007 and 24 August 2007.
In her proposed orders handed to the Court at the commencement of this hearing the wife sought orders which, in summary, would result in:
§the sale of all of the farming lands;
§the discharge of the Rural Finance Corporation mortgage and all other encumbrances secured on title;
§the payment to the Australian Taxation Office of the whole of the judgment sum, interest, costs and penalties owing thereon;
§the payment to the wife of arrears and ongoing lump sum child support of $64,200;
§the payment of an additional s 79 lump sum to the wife of $590,000;
§the balance then to be paid, if any, to the husband.
Otherwise the wife sought additional injunctive, enforcement and further orders pursuant to which personal property and other assets are divided.
Generally the effect of the orders sought by the wife were opened by her counsel to the Court as requesting an overall division of assets, 60% to the wife and 40% to the husband.
In his final submissions, and on instructions, counsel for the wife adjusted the orders sought so that the required division of all of the net assets of the parties, and subject to specific child support orders, were then adjusted to 45% to the husband and 55% to the wife, and with no ongoing spousal maintenance orders.
That percentage division was arrived at by counsel for the wife upon the basis of allowing to her 40% on a s79(4) contribution basis and then adjusting upwards by a further 15% because of what was said to be her substantial s75(2) factors and that therefore is a total division of 55% to the wife with the corresponding division to the husband being the remaining 45%.
At the conclusion of the hearing, and because of the recent settlement of a farm property at M, I allowed both counsel the opportunity to reflect upon and reconsider the actual orders sought and submit written proposals to each other and through my Associate to the Court. On that basis, I have received the final s79 adjustment in dollar terms sought by the wife, after payment in full of the Intervenor, and it is that she retains her personal assets and possessions and her partial property settlement(s) and receives additionally:
§the sum of $558,469; together with
§the further sum of $62,400 as arrears and future lump sum child support.
Husband
The response was initially filed by the husband on 12 December 2005 and thereafter an amended response was filed on 24 April 2007 and then, in his Case Outline of Argument filed with the Court at the commencement of these proceedings the husband identified the orders therein sought as follows:
§that all orders for the payment of spousal maintenance and any arrears thereof be discharged;
§that the sale of the property known as [M property] be settled and that the net proceeds therefrom of approximately $203,000 be paid directly to the Intervenor in partial discharge of its judgment debt;
§that a clearance sale of plant and equipment be held in or about February 2008 and that the estimated net proceeds therefrom of approximately $404,800 be paid directly to the Intervenor in further reduction of its total debt;
§that the husband otherwise retain sole beneficial interest in and ownership of the farming lands known as [C property], [LR property], [LS property], [T property], [H property] and [B property];
§that the husband lease each of the real properties and the monies received therefrom be paid directly to the Intervenor in final discharge of its debt prior to 31 March 2008;
§that the husband otherwise retain sole responsibility for the repayment of the debt to Rural Finance Corporation, [B] Finance Pty Ltd, Bank of Queensland, [D] Finance, Commonwealth Bank Overdraft, and all outstanding property rates and taxes;
§that the husband pay to the wife $10,000 in reduction of outstanding arrears of child support;
§that the wife receive 30% of the net assets which sum should total $244,397 and be paid as follows:
-
partial property settlement from the
[S] property $73,000
-retain her furniture and motor vehicle $16,000
-
cash payment from proceeds of current
grain crops $155,397
$244,397
§all parties pay their own legal costs of and incidental to the proceedings.
In her final submissions counsel for the husband, and on instructions, sought orders which acknowledged the requirement to sell the farming land known as T property after its current crop is harvested and additionally acknowledged that the net property which the wife should be entitled to receive be increased by 5% to a sum of 35% so that the husband would then retain 65% (and not 70%) thereof and after all proper payments have been made to the Intervenor.
Counsel for the husband explained that her submission was supported by an assessment that should be made in favour of the husband pursuant to s79(4) contribution issues of 75% and that then would properly be adjusted downwards by a 10% percentage sum having regard to the balance of s75(2) factors in the wife’s favour; thus a considered and final adjustment would be as to 65% to the husband and 35% to the wife.
As to the subsequently filed orders sought by the husband the payment to the wife pursuant to s79 orders, and in addition to any earlier lump sum partial property settlement, were said to be as follows:
§a sum of $154,240; and
§a further sum of $10,000 in arrears of child support as previously ordered but with no lump sum payment for future child support obligations.
Australian Taxation Office (Intervenor)
The application for final orders was filed by the Intervenor on 4 December 2006 and subsequently amended in the Summary of Argument filed 22 October 2007. The precise orders at first sought by the Intervenor were as follows:
§that the Intervenor be paid the sum of $702,346.47 (subject to adjustment hereafter) with interest accruing thereon upon the judgment pursuant to s101 of the Supreme Court Act 1986 (Vic);
§the Court make such further orders and directions for sale of real and personal property as it deems just and equitable in order to cause payment of the appropriate sum to the Intervenor;
§that the husband and/or wife pay the costs of the Intervenor of these proceedings.
During the hearing the husband settled the sale of the farming property at M in accordance with annexure “H5”. The sale included the value of its crop thereon at $45,000. I delivered an extempore judgment in the course of the hearing which provided for the wife to receive at settlement a payment of $60,000 to be brought to account in these proceedings and effectively to provide her with some cash reserves and the Intervenor the whole of the balance, including the deposit and proceeds of sale of the crop and this sum totalled $136,595.93. On that basis the Intervenor amended its claim and the actual sum sought by its counsel in his final submission was $568,380.17, such sum to be paid on or before 31 March 2008. Significantly no additional interest or penalties are sought on that sum which is therefore fixed and certain if paid in full by that due date.
AFFIDAVITS
Wife
The wife relied upon the following affidavits:
§her affidavit in reply filed 24 August 2007;
§her further affidavit filed 22 October 2007;
§the affidavit of Mr L filed 22 October 2007;
§the Form 13 financial statement filed 22 October 2007;
§the affidavit of Mr BL filed 20 August 2007 insofar as annexed thereto were the title particulars and descriptions of the real property and a valuation schedule of the agreed plant and equipment in these proceedings at $410,000.
Husband
The husband relied upon the following affidavits:
§his affidavit filed 24 April 2007 and the substantial annexures thereto;
§his further affidavit sworn 24 July 2007 and filed by leave at the commencement of these proceedings;
§his Form 13 financial statement filed 24 April 2007;
§his further Form 13 financial statement filed by leave at the commencement of these proceedings.
Intervenor
The Intervenor relied upon the following affidavits:
§the affidavit of Mr H filed 12 October 2007;
§the affidavit of KT filed 12 October 2007.
BACKGROUND FACTS
The following facts were agreed between the parties:
§the wife was born in 1962 and is 44 years of age and her physical health is good though she suffers from stress and emotional issues;
§the husband was born in 1965 and is 42 years of age and enjoys very good health;
§the parties commenced cohabitation in late 1993 and were married in 1997;
§the parties initially separated but continued to live under the one roof on 30 March 2004 and thereafter finally separated in December 2004;
§there are two children of the marriage:
-M [the son] born in 1994, now 13 years of age;
-MA [the daughter] born in 1998, now 9 years of age;
§the children have resided with the wife since separation and spend time with the husband;
§the husband has a child of a subsequent relationship, J aged 3 years though this is a matter of dispute and paternity testing orders have now been requested;
§the wife commenced to live with Mr L in April 2006 and married him in September 2007 and now resides with him in a property, registered in his sole name, at …, D, in which there is minimal equity;
§Mr L has two children aged 8 years and 6 years and he has not seen them for a period now in excess of one year;
§in November 2006 the husband commenced to reside with Ms R, aged 41, who is by occupation a horse breaker and who lives in the homestead and assists the husband with the duties and management of the farm, including harvesting;
§Ms B has two daughters, twins aged 12 years, and they live on the property and the husband financially assists with their support and no child support is paid by their biological father;
§the most recent intervention order between the parties expired on 14 October 2007 and there is now no existing injunctive order or other restraint current against one or both parties as to their domestic circumstances.
PREVIOUS ORDERS (A Summary)
On 6 September 2005 Senior Registrar FitzGibbon ordered by consent, at a time when the wife was represented by counsel and the husband appeared in person as follows:
§the husband pay or cause to be paid to the wife spousal maintenance as follows:
-the sum of $500 per week;
-rental payments on her then address at [a Melbourne suburb];
-gas, electricity and telephone outgoings;
-motor vehicle expenses including registration, insurance, petrol and service charges;
§the husband was otherwise restrained from selling, encumbering, disposing of or otherwise dealing with real or personal property, save upon notice to the wife or in the usual course of business;
§there was a notation to this order whereby the husband reserved his right to argue that he did not have the capacity to make the ongoing spousal maintenance payments as ordered.
On 1 March 2006, and by consent, it was ordered that paragraph 1 of the order of 6 September 2005 be suspended, that is the payment of spousal maintenance and outgoings, save that the husband was required to continue payment of the wife’s residential rental sum of $1,386 per month. Additionally that order further provided that:
§the wife was entitled to rent her property at S (“[S property]”); and
§the husband was to be at liberty to lease the various farming properties provided there was proper disclosure to the wife and that the leases be verified and be for no more than three years.
On 1 June 2006, and by consent, it was ordered that:
§the wife retain the property at S as a partial property settlement and at a valuation of $70,000 with the husband to remove the then caveat from its title;
§the wife had transferred to her name, and as a partial settlement of property, her Toyota motor vehicle valued at $6,500.
By consent orders of 4 April 2007, Mushin J discharged all previous parenting orders and:
§the husband and wife were granted equal shared parental responsibility for the children;
§the children were to live with the wife and spend time with the husband on each third weekend and for one half of school term holidays and for two weeks in the Christmas school holiday period and otherwise on specific occasions.
Further orders were made on 4 April 2007 by Mushin J in the Defaulters List and he ordered that:
§the wife’s Form 2 application filed the previous day seeking the husband to vacate the homestead and farming land and to relinquish possession of all plant and equipment and for all assets then to be sold, and other specific orders, was dismissed by consent, and the husband was required to file an updated valuation of plant and equipment within one month.
On 4 December 2006, the matter was again before Mushin J who permitted the wife to amend her application and then dismissed all interim applications. His Honour also made orders as to children’s issues on an interim basis and otherwise made orders to the effect that:
§each of the husband and wife be restrained by themselves or through their servants or agents from charging or dealing with any asset or resource, or from any such corporate asset owned or controlled by either of them, save in the ordinary course of business or for paying any sum to the Australian Taxation Office.
Thereafter the proceedings were adjourned to a Registrar on 4 May 2007 and then fixed for hearing on 12 June 2007 before Mushin J, at which time they were not reached and then adjourned to 24 July 2007 before myself. On that date the financial and other material before the Court was wholly inadequate and I made specific orders and delivered an extempore judgment to require the husband and wife to better and properly prepare their case for hearing and it is with that background that the matter is ultimately listed before me for hearing on this occasion.
STANDARD OF PROOF
The appropriate standard of proof that I have applied is the civil standard, namely the balance of probabilities. The more serious that the matter or allegation was, or its importance in this case the more strictly I have examined the level of proof required. In Briginshaw v Briginshaw (1938) 60 CLR 336 at 361-2, Dixon, J said:
“Except upon criminal issues to be proved by the Prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the Tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the Tribunal.”
More recently, the High Court in Neat Holdings Pty Limited v Karajan Holdings Pty Limited (1992) 67 ALJR 170 further considered these standard of proof issues and thereafter the New South Wales Court of Appeal in Palmer v Dolman (2005) NSWCA 361 and then in Vines v Australian Securities & Investments Commission (2007) NSWCA 75 said:
“The more recent authorities to which I have referred, and s140 of the evidence Act 1995 (NSW) make it plain that there are no hard and fast rules by which serious allegations might be proved from circumstantial evidence. The inquiry is simply, taking due account of what was said in Neat Holdings Pty Limited v Karajan Holdings Pty Limited, has the allegation been proved on a balance of probabilities”.
For completeness s 140 of the Commonwealth Evidence Act 1995 now provides that, in civil proceedings:
“The court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities”.
OBSERVATION OF WITNESSES
I have had what I consider to be in this case the very real benefit of observing the husband and wife in giving their evidence on oath and in observing their demeanour and character in the courtroom, and also when they were cross‑examined. That observation has been of real assistance in formulating appropriate orders. Those observations are acutely available to a trial judge and the legal authority for such a position is that part of the Judgment of Kirby J in Minagall v Ayres (1966) SASR 151 at 154 per Hogarth J; see also Government Insurance Office of New South Wales v Bailey (1992) 27 NSWLR 304 at p 313:
“By conventional theory, the observations made by a trial judge of the appearance and demeanour of a witness giving evidence are not only available to be used in the determination of a dispute but amount to important ingredients of the decision-making process. They normally provide the primary decision-maker a distinct advance which controls, and even limits, the exercise by the appellate court of its statutory functions in an appeal by way of re-hearing: see Owners of Steamship Honestroom v Owners of Steamship Sagaporack [1927] AC 37 at 47; Jones v Hyde (1989) 63 ALJR 349 at 351; 85 ALR 23 at 27; Abalos v Australian Postal Commission (1990) 171 CLR 167 at 178.”.
I have had the significant benefit of hearing all of the evidence in its entirety, of reading carefully all of the affidavits, the exhibits to the affidavits and the other exhibits in the proceedings. I have reflected upon and have weighed all parts of the individual testimony against the balance of all evidence prior to delivering these reasons for judgment. I stress that my court observations of the parties and Mr L were of benefit and importance.
FAMILY LAW ACT 1975 (CTH), S.79 AND RELEVANT CASE LAW
The proper approach to determining a section 79 application is now well established, both by the Family Law Act and by case law (see In the Marriage of Lee Steere and Lee Steere (1985) FLC 91-626; In the Marriage of Davuat & Raif (1994) FLC 92-503; In the Marriage of Clauson (1995) FLC 92-595).
Section 79(2) requires that any order must be just and equitable. Section 79(2) provides:
“(Just and equitable requirement) The court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
In considering the alteration of property orders that may be required I must have specific regard to and evaluate section 79(4) of the Family Law Act 1975 (Cth). I have detailed throughout this Judgment the very specific contributions both direct and indirect, financial and non-financial and other contributions, including that of a home maker. I have referred to and incorporate within my consideration and evaluation of section 79(4) all such issues and findings.
Section 79(4) specifically provides:
[Matters to be taken into account:] In considering what order (if any) should be made under this section in proceedings with respect to any property of the parties to a marriage or either of them, the court shall take into account-
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them;
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of the, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them;
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent;
(d)the effect of any proposed order upon the earning capacity of either party to the marriage;
(e)the matters referred to in sub-section 75(2) so far as they are relevant;
(f)any other order made under this Act affecting a party to the marriage of a child of the marriage; and
(g)any child support order under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
As was said by Guest J in P & P [2007] FamCA 1006 at para 124:
“the mandatory prescription of the Act is to evaluate contributions pursuant to section 79(4). In Pierce v Pierce (1999) FLC 92-844 at page 85,881 the Full Court (Ellis, Baker and O’Ryan JJ) said: “… there is an obligation on the trial Judge not only to identify the relevant contributions but also to assess them”. Similarly in JEL v DDF (2001) FLC 93,075 at paragraph 152(b) the Full Court (Kay, Holden and Guest JJ) said “…it is a clear general principal, derived from recognised authority that there is a requirement to undertake an evaluation of the respective contributions”.
I have carefully safeguarded against utilising the provisions of section 79 of the Act as a “source of social engineering or as a means of evening up the financial positions of the parties to the marriage”. (See Kennon v Kennon (1997) FLC 92-757 at p. 84,303). It is not the purpose of the relevant provisions of the Act to “… equalize the financial strengths of the parties”, (per Wilson J in Mallet v Mallet (1984) 156 CLR 605 at 638) when addressing his attention to the object of section 75(2) of the Act.
My approach to the division of property involves a four step exercise which I have undertaken in this Judgment, namely:
(a)the identification of the property of the parties, their assets and financial resources net of their liabilities;
(b)the evaluation of the “contributions” and s 79(4) issues;
(c)the evaluation of the matters referred to in s 75(2);
(d)a determination as to whether the result is just and equitable by reference to s 79(2) of the Act. In determining whether the outcome is just and equitable it is “the real impact in money terms which is ultimately the critical issue” (JEL v DDF (supra).
SECTION 75(2) FACTORS
The relevant factors which I have considered and evaluated throughout this Judgment are:
(a)the age and state of health of each of the parties;
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years;
(d)commitments of each of the parties that are necessary to enable the party to support:
(i)himself or herself; and
(ii)a child or another person that the party has a duty to maintain;
(f)subject to subsection (3) the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii)any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia, and the rate of any such pension, allowance or benefit being paid to either party;
(h)where the parties have separated or divorced, a standard of living that in all circumstances is reasonable;
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant;
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
(l)the need to protect a party who wishes to continue that party’s role as a parent;
(m)if either party is cohabiting with another person - the financial circumstances relating to the cohabitation;
(n)the terms of any order made or proposed to be made under section 79 in relation to the property of the parties;
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, or is to provide, for a child of the marriage; and
(o)any fact or circumstance which, in the opinion of the Court, the justice of the case requires to be taken into account.
INITIAL PROPERTY CONTRIBUTIONS
The issue of initial contributions to property has been considered and developed over the years by the Full Court and other Superior Courts.
In the Marriage of Lee Steere (1985) FLC 91-626 (Fogarty, Maxwell and Nygh JJ at 80,078) the Full Court said:
“The strength of a contribution made at the inception of a marriage is eroded, not by the passage of time but by the off-setting contribution of the other spouse”.
In Way and Way (1996) FLC 92-702 (Barblett DCJ, Finn and Butler JJ at 83,404) the Full Court said:
“We regard the law in this area as now settled by the statement of Fogarty J in Money (and subsequently accepted by all members of the Full Court in Bremner) that an initial substantial contribution by one party may be eroded to a greater or lesser extent by the later contributions of the other party even though those later contributions do not necessarily at any particular point outstrip those of the other party”.
More recently in Pierce and Pierce (supra) Ellis, Baker and O’Ryan JJ said at (paragraph 28):
“In our opinion it is not so much a matter of erosion of contribution but a question of what weight is to be attached, in all the circumstances, to the initial contribution. It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and wife. In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use by the parties of that contribution”.
In White v White Lord Nicholls said (at p. 1583F):
“This distinction is a recognition of the view, widely but not universally held, that property owned by one spouse before the marriage, and inherited property whenever acquired, stand on a different footing from what may be loosely called matrimonial property. According to this view, on a breakdown of the marriage these two classes of property should not necessarily be treated in the same way. Property acquired before marriage and inherited property acquired during marriage come from a source wholly external to the marriage. In fairness, where this property still exists, the spouse to whom it was given should be allowed to keep it. Conversely, the other spouse has a weaker claim to such property then he or she may have regarding matrimonial property.
Plainly, when present, this factor is one of the circumstances of the case. It represents a contribution made to the welfare of the family by one of the parties to the marriage. The judge should take it into account. He should decide how important it is in the particular case. The nature and value of the property, and the time when and circumstances in which the property was acquired, are among the relevant matters to be considered. However, in the ordinary course, this factor can be expected to carry little weight, if any, in a case where the claimant’s financial needs cannot be met without recourse to this property”.
I have also considered the unreported Full Court decision, M & M [1998] FamCA 144 (Ellis, Lindenmayer and Brown JJ at paragraph 79) where it was stated:
“In considering the weight to be attached to an initial contribution, one should not lose sight of the subsequent use of such contributions. In the instant case, the substantial benefits which flowed have been identified in the wife’s submissions and by the trial Judge”.
I have carefully considered these contributions and the weight attached thereto in my s 79(4) evaluation. I am aware of and have had regard to the ongoing use of such initial financial positions.
INHERITANCES AND PRE-COHABITATION CONTRIBUTIONS
Wife
I accept the wife’s evidence that at the commencement of cohabitation she owned a motor vehicle and had savings of $46,000 and some household furniture which included a number of antiques.
Husband
The husband was a self employed farmer and he owned 623 acres at G together with:
§a 50% interest in a property of 558 acres being Allotment [1], C; and
§the whole of Allotment [2], C of 542 acres which was encumbered by a debt to the Rural Finance Corporation.
The husband otherwise farmed properties owned by his grandparents and owned the plant and equipment, motor vehicles and other assets identified in paragraphs 17 and 19 of his affidavit and subject to the debts identified therein. There was no cross examination of the husband as to the value at cohabitation of those machinery items, plant and equipment and stock and I am therefore accepting of the husband’s evidence, but with the clear understanding that it was not the subject of any independent valuation, evidence or testing in Court.
As an over-view the husband was then a highly skilled farmer, committed to the land and with significant practical knowledge and experience and operating and cropping farm lands with the necessary plant and equipment. It is those pre-owned and inherited or acquired farming lands that now comprise the significant portion of the parties’ assets, as the land has increased in value over the years and otherwise has facilitated the cropping and farming enterprises and the income received therefrom. It is these facts which significantly underline the very real s 79(4) financial contribution made by or on behalf of the husband.
I have therefore evaluated the substantial property, assets and experience brought by the husband to this marriage and I have assessed these initial contributions against those contributed by the wife and their relevance to the income, earning and activities throughout the marriage and the current pool of assets. I have given significant weight to those initial contributions made by the husband and whilst I balanced the offset in contributions of the wife throughout the marriage previously as a homemaker and parent as I have hereafter carefully evaluated, I specifically have taken into account and given real weight to the nature and value of the husband’s contribution of assets which are substantial.
INTERVENOR – HUSBAND’S TAXATION LIABILITY
I accept the evidence provided by the Intervenor that as at 30 March 2004 the husband’s indebtedness to the Australian Taxation Office was $448,408.98. That sum had arisen as a result of the initial default by the husband on 30 November 2000 and the non-payment of tax interest and penalties thereon from that date until the parties separated under the one roof in March of 2004. The evidence does highlight that this four year period coincided with the severe drought conditions in 2002 and very difficult farming circumstances. Nevertheless, by non-payment of their taxation obligations the family had available, and was able to spend on their lifestyle and business, monies that should have been paid to the benefit of the community.
The wife’s argument in this case has sought to quarantine the taxation liability as at separation and, subject to any proper interest, costs or penalties paid on that sum otherwise to argue that the husband should be solely responsible for the post separation increased tax debt and monies now required to satisfy the total debt of the Intervenor. That argument is submitted either on the basis of the husband’s wastage of income and assets or his refusal to pay or otherwise his diversion of those monies to himself and his businesses.
The Australian Taxation Office obtained judgments against the husband in the Supreme Court of Victoria on 15 February 2005 and then again on 2 March 2007 for the amounts of $338,768.07 and $684,327.24 respectively. Interest, costs and penalties have been accumulated on those respective judgment debts.
Subsequently the Intervenor has retained fuel rebate credits and otherwise made further offset adjustments to which the husband was entitled from time to time.
As at 11 October 2007 the indebtedness of the husband was $702,346.47, though that sum has subsequently diminished because of the partial payment of $136,595.93 made to the Intervenor from the settlement of the land at M which I have hereafter considered in this judgment.
The husband had made no payment in reduction of his taxation liability since February of 2007. In endeavouring to explain the non-payment of this personal liability the husband had previously deposed that:
“As a result of the pressures of work, the lack of diligence in respect to the paperwork and a concern that we would be confronted with considerable tax, interest and late penalties once my taxation returns were lodged I therefore failed to lodge such returns for the financial years ended 30 June 2002, 2003, 2004 and 2005”.
The Intervenor has alleged, and I accept, that the husband has failed to have due and proper regard to his taxation liabilities or to treat them with the same priority as other debts. Indeed prior to the lodgement of those required taxation returns, the debt owing to the Intervenor had, in October 2006, reached a total sum of almost $1.2million. It was the husband’s income losses and other allowable deductions and rebates withheld over recent years that were accepted on the filing of those outstanding taxation returns that have then allowed for the proper reduction in his total indebtedness to the sum now claimed by the Intervenor.
In paragraph 16(f) of the affidavit filed by an officer in the employ of the Intervenor, Mr H, it was there claimed and I accept that the husband was “treating the ATO as a lending institution and chose not to apply any funds towards payment of his tax debt”.
The proposal argued on behalf of the husband is that the balance of the liability to the Intervenor, after the adjustment for the proceeds of the M property sale, be paid off from the sale of farming plant and equipment and the balance from the proceeds received upon harvesting the current wheat and barley crop. In my judgment that is insufficient as it does not provide certainty and make available the required monies to pay, as a priority, his total debt to the Intervenor, reduce other financial liabilities and otherwise provide for a just and timely payment to the wife of monies to which she is now entitled pursuant to the orders arising from these reasons for judgment.
Counsel for the wife alluded to the financial neglect or recklessness of the husband in his dealings with the Australian Taxation Office and the accumulation of debt through unpaid tax, interest, costs and penalties thereon. The wife’s case however did not ultimately prove any deliberate intention by the husband to specifically diminish the value of available matrimonial property. What the wife floated in her evidence and through her counsel was a general position that the husband should have reduced the tax debt from his other income or in preference to paying his legal fees or other farm related outgoings. There was no targeted cross examination of the husband on this issue and, at the highest “a blanket of blame” was intended to be thrown over the husband’s financial and farm management in the years prior to and post separation.
I am aware of the taxation debt at separation and also its fluctuations pre and post separation. Counsel for the wife argued that the tax debt had increased by $253,000 after separation and that should be found to be a negative against the husband’s financial interests. I have identified the husband’s evidence and explanations and generally I conclude that there were many reasons, but primarily drought, crop failure and limited income together with poor financial decisions and planning made by the husband, saw the escalation of the taxation liability.
In Omacini v Omacini (2005) FLC 93-218 the Full Court reviewed three clear categories of cases where it is appropriate to notionally add back to the pool of assets and the third of those categories is where a party had undertaken reckless investments or had deliberately set out to diminish the value of property available for distribution between the parties to a marriage. That issue is to be otherwise found in reported cases such as DJM v JLM (1998) FLC 92-816, Townsend v Townsend (1995) FLC 92-569 and Kowaliw v Kowaliw (1981) FLC 91-092.
On the evidence of this case, and with a very clear understanding of the determination of the husband to retain all farming land, I do not make a finding that the escalation, and the fluctuation, of the taxation liability was primarily targeted to defeat the wife’s claim for a property resolution. It was a combination of inappropriate financial and management skills, limited and variable income, other pressing debts and priorities and the ongoing costs and risks of farming. I have concluded that it would not be proper to financially penalise the husband for his lack of financial skill and the fluctuating taxation liability. Whilst he did show scant respect for the Australian Taxation Office it was within the context of the many other financial liabilities, limited income, drought, the breakdown of the marriage and all of the other factors that I have analysed and ultimately I conclude there was no reckless investment on his behalf nor did he intentionally embark on specific financial transactions to reduce the matrimonial pool of assets.
I accept the Intervenor’s evidence that the wife has no indebtedness to the Australian Taxation Office. The wife last filed an income tax return in the financial year ended 30 June 1997 and it has not been necessary for her to lodge an income tax return for the years 1998 – 2007 (inclusive).
The sum now owing to the Intervenor is $568,380.17, if paid in full by 31 March 2008 as is intended by the Orders now made.
I have had regard to the recently introduced sub-section (ha) of s 75(2) and the outcome of this case will have no other effect upon the Intervenor save that they will be paid their whole financial entitlement by that due date, 31 March 2008, and as I have had no contrary submission from the other parties and that will be the effect of my orders.
POOL OF ASSETS, RESOURCES AND LIABILITIES
To better understand the assets, financial resources and liabilities of the parties I have separately evaluated both the value of the wheat and barley crop, soon to be harvested, and legal fees paid by the parties and in the course of these reasons for judgment I have determined the appropriate basis and adjustment for items and then concluded what should constitute the proper net asset pool. The specific assets or liabilities agreed upon or as found by me in these reasons for judgment are as follows:
ASSETS
§S property 35,200.00
§C property 385,000.00
§T property 195,000.00
§H property 125,000.00
§LS property 200,000.00
§LR property 205,000.00
§B property 330,000.00
§M property 60,000.00
§Farming / Business
Plant and Equipment 410,000.00
§Furniture – wife 3,970.00
§Wife’s motor vehicle 6,500.00
$1,955,670.00
LIABILITIES
§Commonwealth Bank Overdraft – husband 42,400.00
§Rural Finance Corporation 413,000.00
§D Finance 25,000.00
§Bank of Queensland 17,200.00
§Rates arrears on farming lands 36,400.00
§Real estate agent – costs of sale of C property 10,250.00
§Legal cost on sale of C property $1,350.00
§Sale
costs and advertising on plant
and equipment 20,000.00
§
Australian Taxation Office – balance of total
liability due prior to 31 March 2008 568,308.17
$1,133,908.17
Assets $1,955,670.00
Less $1,133,908.17Net assets (subject to crops and legal
costs adjustments) $821,561.83
THE WIFE
The wife met Mr L after her separation from the husband and commenced living together with him on 25 April 2006. They are now married.
The wife is city living person who was not suited to her country lifestyle, on the farm and with the husband. She is committed to the children and I would be confident is an excellent parent to them. Generally I accept that she was truthful in her evidence about her relationships and her financial circumstances. Subject to certain specific findings she came across as truthful in her viva voce evidence though I am confident that she exaggerated her farm and business contributions. She has had an insecure and disruptive lifestyle pre and post separation. There is no ongoing or meaningful civil relationship with the husband and she and her new husband are intimidated and frightened by his actions and temperament.
The wife is no longer in receipt of a supporting parents’ pension and works two days per week for a retail business. Her current income is $190 per week and her further evidence is that she intends to double her working hours and thus will earn approximately $370 net per week. Additionally she continues to receive a family allowance payment of approximately $150 per week, though given the income of her new husband and her own income it is difficult to understand how she does qualify within any means test for that payment. I have evaluated the wife’s earning capacity within a consideration of the various s 75(2) factors, (b), (c), (h), (l) and (na) and I have included an appropriate adjustment within the third step of the required consideration process to fairly and properly balance these issues and conclude a just and equitable property division.
The wife filed a Form 13 financial statement and swore to its accuracy, but she did so in a cavalier and largely irresponsible manner. The document had been earlier prepared and was inaccurate and largely reproduced the contents of an earlier financial statement. It did not disclose her employment, had her still receiving the pension and otherwise there is no help to be gained from the expenses recorded therein as they were reflective of a much earlier period. In response to a question I asked of the wife she acknowledged that she knew the contents of the financial statement were wrong but after a discussion with her solicitor she simply elected to re-swear that inaccurate document. Her actions and her somewhat reckless approach to proper disclosure and accuracy does provide a basis for a level of concern as to her evidence but this was a matter where more appropriate legal advice should have been provided.
The wife was criticised in cross-examination for her failure to obtain reasonable employment and an income after her move to the rented premises in Melbourne in November 2004. I accept that she did apply for various jobs on a shift or weekend basis but these were inappropriate in line with her primary responsibility for the upbringing of the two children. On balance I reject that criticism of the wife in the context of the conflict, tension and violent and obsessive behaviour of the husband that had been part of the latter years of the marriage and continued on after separation.
The wife is and has been the primary parent for the children. Her contribution in this regard as a homemaker and parent (s 7(4)(c)) has been substantial and I accept the evidence of the husband where he acknowledged that the wife “was fantastic as a mother”. I give very substantial weight to this very significant contribution.
The two children now attend schools local to the wife’s new home, the son having commenced secondary college and being in Grade 7 and the daughter in Grade 3 at her primary school. The wife pays all of the school fees and related expenses and the husband’s contribution to these outgoings or his realistic understanding of the expenses of maintaining and supporting the children at school, and generally in their modest lifestyle, is unrealistic and wholly inappropriate. (s 75(2) (c), (l) and (na)
The children have, on the evidence, been affected by conflict, tension and abusive behaviour which they have seen or heard in the latter years of the marriage. I accept evidence that their behaviour exhibits caution and uncertainty and this is a further level of pressure for the wife, and particularly in her new family, to manage. I accept the wife’s evidence in paragraphs 31 – 33 (inclusive) of her affidavit as to the requirement of the children to attend counselling. This circumstance, brought about both by the separation and the husband’s inappropriate behaviour, has increased the wife’s difficult role and level of responsibility for the children and these are matters I assess both in the context of her contribution and also as a s 75(2)(c) matter.
I have separately considered the issue of child support and other financial payments for the family but generally I have concluded that the wife, and her new home, have been placed in significant financial hardship because of the husband’s refusal or sometimes inability to pay. Specifically those factors are matters that I have considered pursuant to s 75(2)(c), (l) and (na).
The affidavit of the wife and that of her now husband highlight the abuse, intimidation and general aggression of the husband. I have read and generally accept the evidence of the wife in paragraphs 21 – 29 (inclusive) of her affidavit. I specifically accept the accuracy of the recorded SMS messages both in this affidavit and also in exhibit “W2”. The content of those messages from the husband, mainly in the months of July and August 2006, are disgraceful, intimidating, threatening and grossly abusive. They provide a very sound basis of fact to understand why the wife is both scared of the husband and could not or would not trust him in any personal or financial dealing.
There is no specific financial claim made by the wife arising out of these SMS messages or otherwise generally out of his insulting and vindictive behaviour of the husband prior or post separation. The relevance is the better understanding of the marriage relationship and the physical and emotional pressures that the wife lived with up to and post separation. I generally accept the evidence of the wife in all such related issues where there is a conflict between her evidence and that of the husband.
The husband’s financial contribution to the children, to their accommodation post separation and generally to their financial support and upbringing has been minimal, notwithstanding his general financial circumstances, the affects of the drought, his reduced income and substantial interest commitments and liabilities. I find that the husband has intentionally limited his required financial contributions to the children as a way of maximising pressure and control upon the wife, and within her new family.
The current arrangement with the children is that the husband has time with them every third weekend from 7.00 p.m. Friday until 4.00 p.m. Sunday (inclusive) and with the changeover at Bendigo. He otherwise enjoys shared school holidays and alternate Christmas periods. There is no current financial contribution made by him for the children and whilst he does incur costs when they are with him and in his return travel to Bendigo that cost is minimal compared with the wife’s required and ongoing financial outlays for and on behalf of the children. These are very specific s 75(2)(c) and (l) factors to which I have specific regard.
The wife’s physical or management and business related contributions to the farming land and businesses is a matter of real dispute between the parties. I have no hesitation in finding that the husband was, on the evidence of the wife, “a workaholic” and that he primarily directed, managed and controlled all farming and business activities. That said the wife did make a contribution to both the farm and the business on a real and necessary basis. There are some specific examples in her extensive paragraph 58 of her affidavit which over-stated her contribution or which occurred on an irregular basis. Nevertheless I am comfortable in my finding that the wife was “the effective backstop” to the general business activities. Specifically she organised financial material, attended to banking, made deliveries and otherwise actually assisted at the direction of the husband with particular activities and this is a s 79(4)(b) contribution. There was no extensive cross examination of the wife on each and every alleged activity and generally the husband’s case was that she did minimal work and had only a basic background involvement. That is to understate the role of the wife which is best understood in the context of the husband working long hours, travelling in his businesses and simply being totally devoted to “his farming lands, his businesses and his work centred lifestyle”.
Specifically in relation to the domestic responsibilities of the wife as identified in sub-paragraphs (a) – (l) of paragraph 58 thereof, I accept her evidence and that is a contribution that I will assess that she made both to the family and in respect of the support and structure given to the business and income earning activities of the husband.
I am however not able to accept the evidence of the wife, at the conclusion to paragraph 58 of her affidavit, where she stated that:
“Over the thirteen years of running the businesses I have worked equally as hard, if not harder, in all that I did, with all the many demands I had upon my life as a wife, mother, full-time carer”.
I find that is an over-statement of her role within the farm and business but I do carefully understand and properly evaluate the importance and reliability of the wife to the farm and business in those years of the cohabitation and marriage and over the years leading up to their separation.
The wife devoted considerable time to explain her contribution to the care and welfare of the husband’s grandmother. There is a very significant divide in the evidence of the parties on this topic and I conclude that the wife’s evidence is more likely correct for the period concerned and for the husband to say that she performed perhaps 5% - 10% of her alleged tasks is a gross and deliberate under-estimation of the wife’s commitment to this elderly lady. I regard her work and effort as an indirect contribution (s 79(4)(b)) and I am particularly mindful that the husband subsequently inherited or was able to purchase farming lands from his grandparent’s estate.
MR L
Mr L is aged 40 and he commenced cohabiting with the wife and children in April 2006.
His work is as a self employed landscaper but it has declined substantially because of the effect of the drought and water restrictions.
He is presently in receipt of a New Start Allowance of $200 per week or thereabouts and that has been paid since February of this year. His evidence however was that he still advertises for work and would lately have averaged one day per week when his earnings would be approximately $500. As a reality he must work more often and earn more income for his family.
He acknowledged suffering from a major depressive illness and is, and has been, on anti-depressant medication for the past four years.
He has recently concluded a property settlement with his former wife and for that purpose sold an investment property and further encumbered the home at …, D. It is registered in his sole name and he has lived there since 1994. Its current market value is approximately $325,000 and the mortgage is now $309,000. That mortgage includes the recently extended amount of $37,000 that was required to meet outgoings of this new family this year.
Mr L has no present contact with his two children aged 8 and 6 years respectively and pays the minimal child support payment for them.
His affidavit filed with the Court on 22 October 2007 is very limited in its provision of financial information to the Court. It concentrates upon the alleged violence of the husband and an incident which occurred at the D home in late July of last year. That matter is currently adjourned for hearing before a Magistrate and I have substantially limited the evidence and the relevance thereof in these proceedings. Insofar as it is relevant to the financial and property issues before me, and otherwise to support the injunctive order that I will pronounce I conclude that the husband was the aggressor on that occasion and that otherwise throughout much of the calendar year 2006 and prior to the husband’s relationship with Ms R he acted in a vindictive, aggressive and wholly inappropriate manner towards both the wife and Mr L. Exhibit “W2” highlights the wholly offensive, provocative and quite appalling behaviour of and messages forwarded by the husband.
I accept that Mr L has a committed relationship with the wife. They have minimal financial equity in the home and a combined limited earning capacity. As a couple they will benefit from the conclusion of all court and legal proceedings.
HUSBAND
The husband was born in S and has spent all of his life in that district. His parents were killed in a motor vehicle accident when he was 18 months of age and he was raised by his grandparents on their farming property at W where they farmed wheat, barley, sheep and cattle. He left school at the end of Year 10 and has since worked exclusively on the land or related businesses.
As an assessment of the husband and aside from comments I have already made about some of his appalling conduct I find him to be a forceful, determined, aggressive and hard working individual wholly committed to his farming lands and country lifestyle. He is a very good farmer but not a good businessman. He has an ability to convince others to permit him to borrow excessive funds but timely and responsible repayment of those monies has been largely ignored by him over the past seven years approximately. He has finally overcome his trauma surrounding the marriage breakdown but has continuing problems in accepting that his children live in a new household and in the city rather than a country environment. His financial conduct towards his family has been largely irresponsible and intended to disrupt and make life more difficult for the wife, and as a consequence therefore the children.
The husband’s acquisition of farming property from members of his extended family, and his establishment of the hire business from about 1992 are detailed in paragraphs 30 – 41 of his affidavit and I accept that evidence.
The husband is wholly committed to his farms and businesses and made a superior work and financial contribution. I wholly accept paragraphs 42 and 43 of his affidavit and his description that he would ordinarily work seven days a week, ten hours a day with family holidays of less than ten days per annum. By necessity that therefore reduced his available time to be with the wife and children and I do not accept his asserted contributions to the care, welfare and upbringing of the children or to household and domestic chores. There was a very clear primary demarcation in this family between the farming and working life of the husband and the wife’s primary obligation for the family and all matters in and around the homestead and with family life, subject to the findings I have made about the wife’s assistance to the management and organisation, and other specific duties for the farm and the business. I therefore do not accept the husband’s over critical analysis of the wife’s activities in paragraphs 45 – 47 (inclusive) and paragraph 51 of his affidavit.
The husband has complained throughout these proceedings of the monies spent by the wife and not accounted for on her purchases of antiques. Paragraph 49 of his affidavit is likely correct and this probably was more of a hobby than a business for the wife but I have no evidence of the existence of such valuable antiques today, or monies retained by the wife therefrom. The husband alleges that the antiques remain in storage in Melbourne but that was not a matter upon which the wife was cross examined and there is no evidence or valuation that can be now brought to account in my financial evaluation of these proceedings.
The husband has a substantial earning capacity from the farming lands but that is always subject to drought and seasonal conditions. I have separately analysed the valuation of the crop in this year and previous years. The income therefrom is dependent upon rain, the seasonal and climatic conditions and the price of grain which is now at record levels. All of those matters are outside of the control or influence of the husband. The husband has no issue with hard work and physical labour and he has supplemented his farming income with a substantial involvement in off-farm activities and a transport business. I therefore conclude that the husband has a very significant physical and mental capacity for gainful employment pursuant to s75(2)(b) and that is in stark contrast to the wife and her modest capacity to earn income, even though she may be physically and mentally capable of appropriate employment. I have therefore given substantial weight to this factor in my determination of the appropriate adjustment made pursuant to this sub-section in favour of the wife.
The husband operated a hire business under the name of JM Hire Pty Ltd and a transport business under the name of JM Pty Ltd. My understanding from the evidence is that these businesses may previously have operated as corporate entities but that is not now the case. The hire business is non-operational and the machines are subject to a repossession order. The husband operates by himself and under a business name the transport and cartage business and in the cash flow analysis produced by his accountant and annexed to his affidavit estimates a gross yearly income of $80,000. In his evidence he acknowledged that this income may be conservative and that he more likely would or could earn an additional $20,000 from this business, subject always to the available time and whether he is otherwise engaged in farming activities.
I balance the earning capacity of the husband to the extent that his new partner is actively involved with the farm and cropping and without her work and effort there would likely be further additional costs and expenses incurred.
As a s 75(2) factor I well understand that the property and financial resources that are to be retained by the husband and his physical and mental capacity for significant gainful employment is far greater and more broadly based than the wife. The husband has the earning capacity to satisfy existing liabilities but with the substantial caveat that his income is dependent upon outside factors and market and economic conditions. I have therefore evaluated all of the evidence contained in the husband’s annexures, cash flow statements, current taxation returns and in his further affidavit and, in the context of all such financial information I have determined orders as to property and other specific issues that I regard as being just and equitable to both parties.
Violence and Intimidation
Under this heading the wife has detailed a number of incidents in her affidavit, paragraphs 21 – 26 (inclusive) of her affidavit which are in addition to the abusive SMS text messages otherwise identified in this Judgment.
In December 2004, after assaulting the wife, the husband was apprehended by six police officers and forcibly restrained by the use of a capsicum spay. He was charged with assault and other offences and incurred a substantial fine and a two year suspended gaol sentence. I reject the husband’s evidence that the wife “was mentally abusing me”. Whilst there was a clear level of aggravation within the marriage, and perhaps they were each somewhat provoking the other there can be no excuse for the level of aggression and intimidation which I find that the husband did direct towards the wife. The fact that a gaol sentence was considered appropriate, even though suspended, does highlight the seriousness of the offence.
In circumstances identified by the wife and Mr L in their affidavits the husband attended uninvited at their home on 25 July of last year and seriously assaulted Mr L and from which criminal charges are pending, the Court hearing having been further adjourned until April of next year. Although I largely discouraged counsel from evidence on this incident it is very clear that the husband was the aggressor and that the incident was serious and unprovoked. Otherwise I do not need to make any further findings in relation to this incident but it does highlight the tense environment and emotional and physical pressures upon the wife and her household.
There is no claim or submission before the Court for a financial adjustment arising out of the domestic violence or the husband’s force and intimidation directed to the wife. Counsel for the wife has no submission before the Court for a particular percentage loading to be granted to the wife for past injury or suffering. I have analysed this domestic evidence in the context of the wife’s responsibilities for the children and I find that her task was made more difficult because of the onerous circumstances and level of conflict in the latter years of the marriage and then post separation. Generally I am aware of these domestic and lifestyle issues within my consideration of the appropriate adjustment for s 75(2) factors.
In the course of the hearing I raised with counsel the likelihood that I would pronounce an injunction restraining the husband from entering upon or otherwise travelling in the immediate vicinity, or of loitering within 200 metres of the wife’s now residence at D or where otherwise she may live from time to time. In particular that is relevant and required because of the recent expiry of the former intervention order. There was no objection from counsel for the husband though I certainly did indicate that such a restriction would not apply if there was a genuine child related reason or if, in some circumstances, the husband was requested by the wife to attend. Given the history of violence and assaults I find this injunctive order is necessary and as it has not been opposed it will be pronounced.
FARMING LANDS AT W
When the parties commenced their cohabitation the husband was a self employed farmer who then owned 623 acres at G which had been purchased in 1987 and additionally a further property known as C which the husband had or later acquired in two parcels of 558 acres and 542 acres. Originally the husband’s sister part owned with him the larger of those allotments but he acquired her interest therein during 1997 for a total payment of $40,000.
In or about 1992 the husband farmed properties owned by his grandparents and these allotments were known as LR, LS, T and H. Subsequently the husband inherited 179 acres comprising LR from his grandmother’s estate and during 2001 and 2002 acquired each of the other family properties from his grandmother’s estate and for that purpose borrowed monies from the Rural Finance Corporation as described in paragraph 34 of his primary affidavit and supported by the annexed documents thereto. I accept that evidence.
The property known as B property, comprising 970 acres was purchased in or about 1998 by the husband and funded from the sale proceeds of the land at G and further borrowings from Rural Finance and again I accept the evidence in paragraph 33 of the husband’s affidavit and the annexure thereto.
The parties have agreed on, and I have accepted, the valuation of the farming lands as follows:
C property $385,000
T property $195,000
H property $125,000
LS property $200,000
LR property $205,000
B property $330,000The property known as C property comprises two Certificates of Title, allotment [1] of some 542 acres and allotment [2] of some 558 acres, in total 1,100 acres. It is level to slightly undulating farming land, divided into five main paddocks and with adequate water. There are no structural improvements on the land. The agreed value of the total land holding is $385,000. If either of the allotments were not to be sold by court order the husband’s preference would be to retain allotment [1].
The land holding known as T property comprises almost 600 acres and is valued at $195,000. This property comprises a soil profile from red mallee loan to lighter sandy ridges. It is vacant land with an adequate water supply and this is the husband’s preferred sale option if any individual and only one parcel of land is to be sold.
The property known as H property is of approximately 420 acres and by agreement is valued at $125,000. Part of this land cannot be farmed but the remaining 390 acres approximately is now under crop and has no structural improvements.
Aside from potential capital gains tax being paid on the sale of farm lands, the husband through his operation of the farming enterprise or his other businesses has acquired available capital losses and there is not an accurate assessment of the quantum and value of such tax losses now before the Court.
The parties agreed and I was asked to proceed with the hearing of this case and to determine a just and equitable settlement of property on the basis that there is an offset of any benefit of capital tax losses retained by the husband as against any likely present or future capital gains tax on the farm lands. Accordingly I excluded from the identification of assets and liabilities each of these issues and the case thereafter proceeded upon that basis. That disclosure to the Court was made in the presence of the Intervenor and officers from the Australian Taxation Office who were then in Court.
During the hearing I raised with counsel, in the presence of their clients the circumstance of an assessment for income tax issuing in the name of the husband from the current crop proceeds. I was requested to exclude such a potential tax assessment because of the available farm and business expenditure in the relevant year and other useable losses. In any event I received no evidence during the trial as to such expenditure or losses and I would not have been able to have reached any informed determination of that issue.
B FINANCE
Throughout the marriage the husband has had an established financial relationship with B Finance and has financed and acquired many assets, real and personal, through their financial assistance. The current debt now owing to this financier is approximately $156,000.
The S property was renovated with a borrowing of $80,000 and that sum forms part of the current liability. Additionally the husband has acquired trucks and farming equipment and, near to the commencement of this case a prime mover had been repossessed by B Finance and was offered for sale by the Fowles Auction Group. It was passed in at $45,000 against a reserve of $60,000. B Finance has also reclaimed four machines, though physically they are on farms in Victoria and interstate and have not yet been physically acquired or offered for sale.
I accept that the husband has a close business and financial relationship with this financier which he desires to continue for his future farming and business requirements. He has proposed collecting the machines, being responsible for the cost of transport thereof which he estimated at $20,000 and otherwise selling them in reduction of the current liability to the financier.
In the course of his evidence he volunteered that he would retain possession of all of the assets over which B Finance has security and otherwise would be responsible for their debt and all interest, costs and penalties thereon. That is likely, in my opinion, to be a generous offer to the financial advantage of the wife and, naturally, that was accepted by her and her counsel. I have balanced this liability and the probable costs of the husband discharging the total debt as part of this financial contribution to the conservation of the net asset pool.
Given the husband’s very considerable mechanical and farming knowledge and experience I regard it as a just and equitable outcome and will accordingly order that he retain the whole of that liability and, subject to any order for possession in favour of that third party the assets for him to sell and reduce or extinguish that liability.
On all of the evidence my assessment will be that, almost certainly, a financial shortfall will arise and remain the sole responsibility of the husband and I have factored that outcome into my reasons and orders.
FINAL NET ASSET POOL
I have concluded that the preliminary pool of net assets earlier identified in the sum of $821,761.83 (say $821,762) must now be adjusted upwards by the addition of the following:
§Crops $227,200
§Legal fees added back $84,000
$311,200
Upon an examination of all of the assets and liabilities I conclude that the appropriate net asset pool available for division between the husband and wife is $1,132,962 and I have evaluated all of the various contributions, financial and non-financial, business and homemaker, together with all of the relevant s 75(2) factors in determining a just and equitable division of that sum.
MONIES RECEIVED BY WIFE
The wife has received or retained the following monies which are included within the net asset pool:
§S property $35,200
§M property $60,000
§Furniture $3,970
§Motor vehicle $6,500
$105,670
This sum will therefore form part of the balance of monies to be paid to the wife by the husband pursuant to these orders.
SPOUSAL MAINTENANCE AND OTHER PAYMENTS
Pursuant to the consent order, at which the husband was self represented, on 6 September 2005, this Court ordered until further order for the husband to pay to or on behalf of the wife:
§the weekly sum of $500;
§her rental payment on the Melbourne home;
§gas, electricity and telephone on that home;
§motor vehicle expenses including registration, insurances, petrol and servicing.
The wife deposed to the husband’s failure to make any payments pursuant to those Orders in paragraphs 35 and 29 of her affidavit. The calculation by the wife of the unpaid monies was as follows:
§rental payments - $12,479.85
§spousal maintenance - $29,000.00
§utilities and services - $6,255.00
§motor vehicle expenses - $7,991.00
The difficulty with those orders is that by consent on 1 March 2006 payments were suspended by Orders of Senior Registrar FitzGibbon and an ongoing rental payment of $1,386 per calendar month was then agreed. There is no order or notation as to arrears owing under those Orders though the rental arrears as alleged by the wife encompass that ongoing adjusted rental payment.
The initial Orders had a notation attached, when the husband was self represented, to the effect that:
“The husband reserves the right to argue that he does not have the capacity to make the ongoing payments for spousal maintenance pursuant to these Orders”.
In paragraph 70 of his affidavit the husband deposes to the fact that he did not appreciate the significance of the making of the Orders nor was consideration given to the loan repayments that he was then allegedly making in respect of the extensions to the S property of approximately $2,000 per calendar month.
No payment of those arrears were sought in the proceedings before me. No ongoing spousal maintenance order is now sought. The wife’s evidence is that because of the husband’s failure to pay she and the children have been placed in significant financial hardship and in that context the wife’s borrowings from her mother and her credit card debt post separation can be more easily understood.
From his farming activities in the previous year and his other businesses, the husband did have a capacity to pay spousal maintenance and the notation does not negate the orders and the financial consequences thereof. I therefore balance the substantial debts of the wife that were accrued in this post separation period and when she was financially deprived by the husband in the context of her explanations and evidence and my resultant findings.
CHILD SUPPORT
Pursuant to her application the wife seeks a departure from administrative assessments of child support made by the Agency so that the husband would be properly assessed to pay $15,600 per annum for the children ($7,800 per annum for each child) for the four year period 1 July 2005 – 30 June 2009 (inclusive).
The wife deposes to the various child support assessments and arrears owing thereunder in paragraphs 36 – 39 (inclusive) of her affidavit and I accept her evidence, the husband’s non-payment of child support since May 2006 and the necessity for him to make appropriate ongoing payments to the benefit of his children. The husband and wife were each seeking an enforcement or a review of assessments until such time as the husband ceased all child support payments in June 2006 and thereafter, on 31 July 2006, Federal Magistrate Riethmuller ordered:
§a stay of all collectionable years;
§an ongoing assessment of $150 per week per child, a total of $300 per week.
The husband’s response is contained in paragraphs 80 – 92 of his affidavit of which I have read.
First as to the issue of past arrears of child support I have decided to order only the payment of arrears of child support in the sum of $10,000 now offered by the husband. These monies are to be paid from the proceeds of the wheat crop in this current season. I decline to assess the child support payments for each of the financial years ended 30 June 2006 and 30 June 2007 in the adjusted quantum sought by the wife. I find that to be excessive and beyond the proper income and the financial capacity of the husband. I have had full regard to all prior domestic financial circumstances of the parties including their income and expenses and an evaluation of the wife’s Commonwealth Bank overdraft account and her expenditure of partial settlement monies.
I have carefully reviewed the decision of Senior Case Officer R dated 8 September 2006 and, with the knowledge of the income and financial circumstances of the husband, I find that the amended decision is substantially flawed and the income child support amount as fixed is oppressive.
Pursuant to exhibit “JDM-24C” to the husband’s affidavit a letter dated 21 February 2007 written on behalf of the Child Support Agency has fixed the then child support arrears at $7,613.60 plus late payment penalties of $1,017.41, a total debt due of $8,631.01. The wife seeks a departure from the administrative assessment for the past two financial years in the sum of $31,200 plus, presumably, an adjustment from 1 July 2007 until date of hearing and that would fix the arrears allegedly owing at close to $37,000. I do not accept that sum.
With the very detailed knowledge of all relevant financial circumstances and lifestyle of the parties, and the specific financial needs of these children, I have concluded that it is proper that there be a departure from past assessments. I intend to fix the child support payment sum at $15,600 per annum for each of the financial years ended 30 June 2008 and 30 June 2009. The proper child support sum is therefore $7,800 per annum for each of the children.
Given that I have made specific orders for the husband to pay various lump sums to the wife and other interested parties and in reduction of debt I intend the payments of $15,600 per annum to be paid as a lump sum, and not as a monthly payment and to be paid as follows:
§for the child support year 1 July 2007 - 30 June 2008 to be paid on or before 1 June 2008
§for the child support year 1 July 2008 – 30 June 2009 to be paid as a lump sum on 1 January 2009.
That lump sum order is made pursuant to s124 of the Child Support (Assessment) Act 1989 so that the payment is by way of lump sum non-periodic payment rather than any periodic or monthly payment.
I intend that, as and from 1 July 2009 the Child Support Agency determine the proper periodic child support sums then to be paid and assess the husband and make collections of payments for each of the children (as may then be appropriate) for and on behalf of the wife.
SECTION 79(4) ASSESSMENT
I have set out in this judgment, and have taken into account, each of the required considerations identified in this sub-section.
I have already identified the significant contribution made by the husband, financial and non-financial to the acquisition, conservation and improvement of the farming lands and substantial plant and equipment. I have identified the pre-marriage assets and farming knowledge of the husband and the fact that throughout the marriage and post separation and for the future years he will have that knowledge, experience and farming and business skills to earn a good income. Certainly far greater than the wife will ever achieve.
The wife did make a non-financial contribution through her work, time and effort on the farm and as “a backstop” to each of the businesses but I assess that contribution as being substantially less than that of the husband. Additionally I have assessed the wife’s contribution financially to the S property and generally to the marriage and given that due weight.
The wife did make the primary contribution to the welfare of the family and the children through her capacity as homemaker and parent. She was the primary contributor in this regard and the husband’s role and contribution was generally modest when compared to that of the wife particularly in the context of violence and abuse to which I have referred.
Insofar as they are relevant I have identified and separately evaluated the relevant s 75(2) factors within my contributions considerations. Likewise I have considered the effect of the orders on the earning capacity of both parties. Primarily this will effect the husband as he is the person required to make payment of a cash amount to the wife and to the intervenor and otherwise reduce, discharge or be responsible for the payment or management of the very substantial liabilities of the farm and business. Any required or further sale of farming land will affect his earning capacity and I have properly evaluated these circumstances.
I have likewise separately considered the child support obligation as provided for in sub-paragraph (g) and those considerations form part of my step two considerations in determining an appropriate adjustment as between the husband and wife on s 79(4) matters.
I conclude that there must be a substantial finding of contribution in favour of the husband, which I assess to be 20%, and therefore my assessment is there should be a finding pursuant to this sub-section as to 70% in favour of the husband and the remaining 30% as an award to the wife.
SECTION 75(2) FACTORS
I have previously outlined the relevant factors and evaluated each of them but I record that the most significant of them I regard to be sub-sections (a), (b), (c), (g), (l), (m) and (na) together with the various other facts and circumstances which I have considered pursuant to sub-section (o) thereof.
The wife has and will continue to have the primary responsibility both as a parent and financially for the care, welfare and upbringing of the children. She has a limited career opportunity for significant gainful employment and the income and health circumstances of her new husband are such that there is an increased level of pressure upon her to work, earn income and perform all of her household and domestic responsibilities. Her standard of living has reduced and there is simply not the available monies, whether they are earned or borrowed, as was previously available to her within her prior marriage. She can have no certainty that the husband will continue to pay and provide appropriate child support or make proper financial contributions to the education, sporting and social lifestyle of the children.
In contrast I have analysed the income, property and financial resources of the husband and his very real capacity for continued gainful and prosperous work and employment. He has no primary obligation to care for children though his partner does have her children living in his household and for which he has a degree of financial responsibility. His standard of living is largely unaltered though he has an ongoing substantial debt and his new partner is able to vigorously contribute to work and farming life.
Both parties have financial commitments and required monthly payments of outgoings that do financially impact upon their ability to support themselves and in the case of the wife, the children. I do not intend to make any adjustment in reliance upon sub-paragraph (d). The wife will soon relinquish her Commonwealth benefit payment as she acquires ongoing employment and neither of the parties have any superannuation fund and thus I have had no regard to sub-paragraph (f).
I have had regard to the financial circumstances relating to the cohabitation of each of the parties with their new partners though neither of those partners is currently earning any significant independent income and, as I have analysed, there are health issues or financial limitations with each of them.
The terms of the s 79 division of property will provide a cash sum to the wife so that she, at her election, may substantially reduce debt on the matrimonial home where she now resides or otherwise make appropriate investments in her name to better secure her future and those of her children. The lump sum payment to the wife will impose further financial difficulties upon the husband but that is by his own election as otherwise I would have ordered the immediate sale of T property. If there is any default made by the husband I specifically intend interest payments to be paid at the prescribed rate in the Family Law Rules and for T property to be forthwith sold, at his expense, and for the wife to be paid then all monies and interest owing to her.
I conclude that there should be a further adjustment, in step three of the identified process and pursuant to this sub-section whereby the wife is awarded a loading of 12½%.
OUTCOME
Accordingly and considering both s79(4) contribution and each of the relevant s75(2) factors I conclude that it is a just and equitable order to divide the net asset pool, aside from any past or ongoing child support obligations as follows:
§As to the wife - 42½%
§As to the husband - 57½%
MONIES AVAILABLE TO HUSBAND TO SATISFY ORDERS
Arising out of these reasons for judgment the orders that I have pronounced will require the husband to sell the 1,100 acres known as C property and the plant and equipment as identified and valued and otherwise there will be the net income from the wheat and barley crop as identified and after allowing a $40,000 sum for the costs of harvest and an additional $10,000 for the payment of the crop lien. The figures for the monies received from the sale of C property and plant and equipment are net of the agreed costs and expenses of sale. The husband will therefore have shortly available to him the following sums:
§C property $373,400
§Plant and equipment $390,000
§Crops $227,200
$990,600
This lump sum is of course in addition to any other extended borrowing facility that the husband may negotiate and additional to any other earnings of his household.
MONIES TO BE PAID TO INTERVENOR
The husband must pay the intervenor the total sum of $568,308.17 prior to 31 March 2008. I require him to make partial payment of this amount as soon as the monies are available to him, or on his behalf from the sale of C property, the plant and equipment clearance sale or from the proceeds of sale of the wheat and barley crop. I intend that the instalment payments to be made to the intervenor are as follows:
§From the sale of C property $280,000.00
§From the proceeds of the barley crop $150,000.00
§From the plant and equipment sale $138,308.17
$568,308.17
The lump sum then available to the husband from the sum of $990,600 after payment of the monies to the intervenor would be $422,292 (rounded).
OTHER LIABILITIES TO BE PAID BY HUSBAND
As I understand the loans from the Bank of Queensland and D Finance are secured by chattel mortgage over various items of the plant and equipment then, most likely and unless the husband otherwise negotiates additional security, these liabilities will need to be first discharged before monies are available from the sale of machinery, plant and equipment. I will therefore order that the husband, as a priority if he is required so to do discharge each of the following liabilities:
§ Bank of Queensland $17,200
§ D Finance $25,000
$42,200
I well understand that additionally there will be a further sum to be paid by the husband for arrears of rates and taxes on C property and there may be an additional sum payable to Rural Finance Corporation in reduction of their lending facility of $413,000. The husband will simply have to make appropriate payments or arrangements if he is to avoid the immediate sale of T property.
After payment of those chattel mortgage debts the husband would have available to him to contribute to a lump sum payment to the wife a sum of up to $380,092 ($990,600 less $568,308 and then less $42,200 = $380,092).
MONETARY EFFECT OF ORDER
I now specifically consider the real impact in money terms which has been emphasised by the Court to be a critical issue. The effect of the orders will be that, of the net asset pool of $1,132,962:
§the wife will receive or retain monies or assets to a value of $481,508;
§the husband will receive or retain monies, property or assets to a value of $651,453;
§the husband will therefore receive and retain total property, money and assets in a sum of $169,945 more than that of the wife and further that the wife’s spousal maintenance claim which was not pursued otherwise be wholly extinguished.
FOURTH STEP
In accordance with the requirements of case law I now propose to stand back and reflect upon the overall determination and the reasons given in this Judgment, both in percentage terms and monetary terms. Having now considered and re-evaluated all of the evidence and having re-read this Judgment I conclude that the proposed orders are just and equitable pursuant to provisions of s 79(2) of the Act.
MONIES TO BE PAID TO WIFE
Pursuant to the orders the wife is to receive a total sum of $481,508. I have previously concluded that she has received or retained a sum which I have found to be $105,670 and therefore the balance due and payable by the husband is $375,838 and this sum can be met by the husband having available to him a sum pursuant to these orders of up to $380,092 though $275,000 of that sum is to be made by progress payments as ordered but which I have further summarised in the following paragraph.
That sum of $275,000 is to be partially paid to the wife by the following instalments as soon as they are available:
§On sale of C property $40,000
§On sale of plant and equipment $150,000
§From the barley crop $60,000
§From the wheat crop $25,000
$275,000
Thereafter the further sum of $105,092 must be paid to the wife by 1 April 2008. It would be unjust to allow any further time for payment as the husband has been granted the opportunity as a result of the orders to retain T property and otherwise refinance his liabilities and with the distinct financial advantage of planting a wheat and barley crop and trusting in climatic conditions and a good return on harvest. If in default I conclude it is just and equitable that the property known as T property be immediately offered for sale, at the husband’s cost and expense and on a similar basis to the ordered sale of C property. Interest at the rate prescribed by the Family Law Rules shall then be payable to the wife on all monies outstanding from that day of default until paid.
SECTION 106A
The wife sought orders pursuant to s106A that a Registrar of the Court be appointed to sign all contracts, transfers and documents in the name of the husband. I have concluded that I will not pronounce this order but that the husband should have the opportunity, through his solicitor and as he will have the primary conduct of any sale of farming land to sign all necessary documents punctually. I would however emphasise that if there was any delay brought about by the husband’s inaction in signing any required document then there should be little hesitation in appropriate orders being made for the Registrar to sign in his name and likely there would be costs orders against the husband following such event.
I certify that the preceding paragraphs are a true copy
of the reasons for judgment herein of The Honourable
Justice Young
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