Maxwell and Maxwell
[2008] FMCAfam 969
•10 September 2008
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| MAXWELL & MAXWELL | [2008] FMCAfam 969 |
| FAMILY LAW – Property settlement – proceedings brought 12 years after divorce – hardship – exercise of discretion – contribution – future needs – just and equitable order. |
| Family Law Act 1975 ss.44, 75, 79 |
| DW and GT [2005] FamCA 161 Hickey & Hickey & Attorney-General of the Commonwealth of Australia (Intervener) (2003) FLC 93-143 Norbis v Norbis (1986) 161 CLR 513 Pierce v Pierce (1998) FLC 92-844 Whitford and Whitford (1979) FLC 90-612 Williams & Williams [2007] FamCA 313 |
| Applicant: | MS MAXWELL |
| Respondent: | MR MAXWELL |
| File Number: | SYC 3289 of 2007 |
| Judgment of: | Altobelli FM |
| Hearing date: | 22 July 2008 |
| Date of Last Submission: | 22 July 2008 |
| Delivered at: | Sydney |
| Delivered on: | 10 September 2008 |
REPRESENTATION
| Counsel for the Applicant: | Mr Davidson |
| Solicitors for the Applicant: | JSM Lawyers |
| Respondent: | Self-represented |
ORDERS
THAT leave be granted to the Wife pursuant to s.44 of the Family Law Act (“the Act”) to bring property proceedings against the Husband pursuant to s.79 out of time.
THAT the Wife, within twenty-eight (28) days from the date of these Orders, will do all acts and things and sign all documents necessary to transfer all her right, title and interest in the property known as Property [X] in the State of New South Wales and being folio identifier [1] (“the [X] Property”) to the Husband.
THAT upon the transfer of the [X] Property to the Husband, the Husband be declared the sole legal and equitable owner of the [X] Property.
THAT the Husband and the Wife do all things and sign all documents necessary to refinance the Property and to release and discharge the Wife from any and all liability to Communication Credit Union Ltd pursuant to mortgage [Z] in respect of the [X] Property.
THAT the Husband, from the date of these Orders and by this order hereby indemnify the Wife from and in respect of any and all liabilities, actions, claims, suits and demands for council rates, water rates, strata levies and mortgage repayments relating to the [X] Property.
THAT the Husband, simultaneously with Order 2, will do all acts and things and sign all documents necessary to transfer all his right, title and interest in the property known as Property [Y],in the State of New South Wales, being folio identifier [2] (“the [Y] Property”) to the Wife.
THAT upon the transfer of the [Y] Property to the Wife, the Wife be declared the sole legal and equitable owner of the [Y] Property.
That no later than twelve (12) months from the date of this Order, the wife pay the Husband $122,899. Pending payment the husband’s entitlement to payment from the wife in accordance with these Orders shall be charged against the property and he will be entitled to lodge a caveat in respect of the same, such caveat to be withdrawn at the time of payment.
THAT the Wife, from the date of these Orders and by this Order hereby indemnify the Husband from and in respect of any and all liabilities, actions, claims, suits and demands for council rates, water rates, strata levies and mortgage repayments relating to the [Y] Property.
THAT unless specified in these Orders and except for the purposes of enforcing the payment of any moneys due under or any subsequent orders;
(i)Each party be declared the sole legal and beneficial owners of all items of property presently in their respective possession or control including but not limited to money, shares, real property, entitlement to superannuation, financial resources, motor vehicles and personal effects; and,
(ii)Each party hereby foregoes any claim they may have to any superannuation benefits belonging to or earned by the other.
THAT all parties shall promptly do all acts and things and give all consents and execute all documents in writing necessary to give effect to these Orders.
THAT in the event that either party refuses or neglects to execute any Deed or instrument necessary to give effect to all or any of the Orders made herein the Registrar of the Court be appointed pursuant to section 106A to execute such Deed or instrument in the name of the said party and to do all acts and things necessary to give validity and operation to the said Deed or instrument.
IT IS NOTED that publication of this judgment under the pseudonym Maxwell & Maxwell is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYC 3289 of 2007
| MS MAXWELL |
Applicant
And
| MR MAXWELL |
Respondent
REASONS FOR JUDGMENT
Introduction
Even though the husband and the wife in this case separated in 1991, about 17 years ago, they are still very civil towards each other. They divorced in 1994. The wife did not commence proceedings under the Family Law Act 1975 (“the Act”) until 2006. She now applies to the Court for leave under s.44(3) to commence s.79 proceedings out of time, based on the hardship that would be caused to her if such leave is not granted. If such leave is granted, I will then need to consider her application for alteration of property interests, commonly known as a property settlement. This will be quite challenging having regard to the very significant time that has elapsed since separation.
Background
The husband is now 61 years old. He is a [occupation omitted] and lives in Sydney. He has remarried. The wife is 55 years old. She is an [occupation] and also lives in Sydney. They commenced cohabitation in 1975, married in 1976 and separated in 1991 after about 16 years of cohabitation. They had 3 children together, and the wife had a daughter from a previous marriage who was adopted by the husband. At the time of separation the children were aged 21, 13, 11 and 10. The wife and children remained in the former matrimonial home after separation, and indeed the wife remains there today.
It is common ground between the parties that if a property settlement had been entered into between them in 1994 when they were divorced the wife would have received greater than 50% to reflect the fact that she had the care of the children. Indeed, based on all the evidence before me about the contributions made by both parties, and the relevant s.75(2) considerations, I believe the wife would have been entitled to at least 65%. Moreover the husband’s affidavit filed
12 September 2007frankly and appropriately concedes that her contribution was equal to his, in the context of their 2 major assets at the time i.e. the properties at [Y] and [X]: see paragraph 30-32. Having regard to these concessions made by the parties, I do not regard it as necessary to set out a history of the marriage prior to separation because, whatever it is, the parties agree that their respective contributions were equal. The assessment of s.75(2) factors is an academic point in the circumstances because, if I grant leave, the focus will turn to post-separation contribution, and a possible assessment of an entirely different range of s.75(2) factors.
I wish to record, however, that even if I am wrong in proceeding on the basis that the parties themselves conceded that contribution at separation was equal, that is the finding I make. This relationship continued for 17 years. Whilst the husband may have made a greater financial contribution in the early years of the marriage, the wife made diverse contributions afterwards including game-show winnings. At the end of their marriage a finding of equal contribution is irresistible.
After separation the wife and children continued to occupy [Y] and, for all practical purposes, the husband had control over the [X] property. The wife continued to service the mortgage on [Y]. At separation its balance was about $91,000. Its current balance is about $21,000. The husband received the rentals from the [X] property. This is not a case where there was an informal property settlement between the parties: cf DW and GT [2005] FamCA 161. There simply was no property settlement, formal or informal. If I grant leave, one of the issues I must decide is about post-separation contribution to [X], [Y], and indeed any other property that either party may have acquired after separation.
The leave application
The husband’s opposition to the wife’s leave application vacillated during the proceedings. Whatever may have been the situation prior to the hearing before me, the fact is that no order had been made granting leave under s.44(3) of the Act, and the husband maintained that opposition at the hearing. It is important to record, however, my observations about the husband, particularly as regards this issue. Once the evidence had been presented, and cross-examination had taken place, even the husband seemed to accede to the inevitably of leave being granted. The husband is clearly an intelligent, articulate and deep-thinking man. He represented himself quite capably in the proceedings. His affidavit material was extensive. Though he was prone to refer to much irrelevant material, a matter which even he recognised, the balance of his evidence was clearly articulated and helpful. Quite frankly the husband seemed much more concerned about how a property settlement would adversely impact on assets he acquired after separation, than he was about the granting of leave per se. This is understandable, but does not go to the hardship issue.
Section 44(3) and (4) states:
(3) Where, whether before or after the commencement of section 21 of the Family Law Amendment Act 1983 :
(a) a divorce order has taken effect; or
(b) a decree of nullity of marriage has been made;
proceedings of a kind referred to in paragraph (c), (caa), (ca) or (cb) of the definition of matrimonial cause in subsection 4(1) (not being proceedings under section 78 or 79A or proceedings seeking the discharge, suspension, revival or variation of an order previously made in proceedings with respect to the maintenance of a party) shall not be instituted, except by leave of the court in which the proceedings are to be instituted or with the consent of both of the parties to the marriage, after the expiration of 12 months after:
(c) in a case referred to in paragraph (a)--the date on which the divorce order took effect; or
(d) in a case referred to in paragraph (b)--the date of the making of the decree.
The court may grant such leave at any time, even if the proceedings have already been instituted.
(4) The court shall not grant leave under subsection (3) or (3A) unless it is satisfied:
(a) that hardship would be caused to a party to the relevant marriage or a child if leave were not granted; or
(b) in the case of proceedings in relation to the maintenance of a party to a marriage--that, at the end of the period within which the proceedings could have been instituted without the leave of the court, the circumstances of the applicant were such that the applicant would have been unable to support himself or herself without an income tested pension, allowance or benefit.
The issue is the hardship that would be caused to the wife if leave was not granted. In cross-examination the husband conceded that he would not suffer hardship if leave was granted.
The wife’s case for hardship is based on the following facts. In 2005 the husband severed the joint tenancies on their properties, thus creating tenancies-in-common in equal shares. The wife asserts that she is now vulnerable to an order for sale, an outcome that would gravely prejudice her personal and financial position, particularly in view of what she asserts are the significant post-separation financial and non-financial contributions she had made to [Y] without the benefit of any similar contribution by the husband. Moreover the wife asserts that part of her reason for not commencing proceedings within time are based on a concern for how the husband would cope with proceedings. Even the husband agrees that these proceedings would have caused him considerable stress.
In relation to the hardship issue, and indeed in relation to almost every issue except post-separation contributions, there are no factual disagreements between the parties.
In Whitford and Whitford (1979) FLC 90-612 at 78,144 the Court stated:
Thus, on an application for leave under sec. 44(3), two broad questions may arise for determination. The first of these is whether the Court is satisfied that hardship would be caused to the applicant or a child of the marriage if leave were not granted. If the Court is not so satisfied, that is the end of the matter. If the Court is so satisfied, the second question arises. That is whether in the exercise of its discretion the Court should grant or refuse leave to institute proceedings.
On the question of hardship the Court said at 78,145
Hardship may be caused to an applicant if leave were not granted to institute proceedings, although the applicant is not in necessitous circumstances. Whatever the financial situation of an applicant may be, his or her loss of a prospective entitlement to property including money, or his or her inability to have the financial and property relations of the parties adjusted or resolved, may constitute hardship.
Even though separation took place 17 years ago, and a divorce 14 years ago, I am satisfied that the wife has established to the requisite standard that she will suffer hardship if leave is not granted to her to commence proceedings under s.79 of the Act out of time. I grant such leave. Under the circumstances the potential loss to her of a prospective entitlement is hardship. Moreover there are no circumstances that would lead me to exercise my discretion against granting leave.
Remaining issues: section 79
The wife seeks orders under s.79 that would result in the husband having [X] in his sole name; the wife having [Y] in her sole name; that she pays the husband $95,000 within 12 months; and that each party otherwise retains what is in their possession or control. It is important to recognise, however, that the wife’s methodology involves a consideration of all of the assets and liabilities of the parties as at the date of the trial, including a substantial inheritance received by the husband post-separation and it involves the Court accepting a quantification of the wife’s post-separation contributions to [Y] in a lump sum.
The husband seeks an order under s.79 that likewise would result in him retaining [X] in his sole name; the wife retaining [Y] in her sole name; and the wife paying to the husband a sum of money that would equalise their respective interests in these properties i.e. a 50:50 result in relation to these properties; and they would otherwise retain what they each have. His focus is, therefore, on the real property, and not the other assets.
The issues that therefore arise for determination in this case are as follows:
(1)Taking into account as a relevant consideration, but not a determining factor, the concession by the parties (or in the alternate, my findings) that contribution at the date of divorce, and by inference at separation, was equal, what further adjustment (if any) should be made in favour of the wife for her post-separation contribution in relation to the care of the children, and the preservation and improvement of [Y]?
(2)Should there be a further adjustment in favour of the wife pursuant to s.75(2) of the Act?
My approach must, fundamentally, be to consider all of the assets and liabilities of the parties as at the date of the hearing. I cannot exclude certain assets merely because they were acquired post-separation. However, my assessment of contribution needs to be undertaken with a fine brush, rather than a broad brush. In other words, this could be one of those comparatively rare cases where unusual circumstances predicate towards an asset-by-asset approach to contribution, rather than a global one.
Applicable Law
Section 79 of the Act states:
(1) In property settlement proceedings, the court may make such order as it considers appropriate:
(a) in the case of proceedings with respect to the property of the parties to the marriage or either of them--altering the interests of the parties to the marriage in the property; or
(b) in the case of proceedings with respect to the vested bankruptcy property in relation to a bankrupt party to the marriage--altering the interests of the bankruptcy trustee in the vested bankruptcy property;
including:
(c) an order for a settlement of property in substitution for any interest in the property; and
(d) an order requiring:
(i) either or both of the parties to the marriage; or
(ii) the relevant bankruptcy trustee (if any);
to make, for the benefit of either or both of the parties to the marriage or a child of the marriage, such settlement or transfer of property as the court determines.
(2) 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.
(4) In considering what order (if any) should be made under this section in property settlement proceedings, 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; and
(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 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; and
(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; and
(d) the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e) the matters referred to in subsection 75(2) so far as they are relevant; and
(f) any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g) any child support 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.
The provisions of s.75(2) are also relevant. It provides:
(2) The matters to be so taken into account 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;
(e) the responsibilities of either party to support any other person;
(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;
(g) where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable;
(h) the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income;
(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; and
(j) the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party;
(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:
(i) the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party;
(na) any child support 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; and
(o) any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p) the terms of any financial agreement that is binding on the parties.
The preferred approach to the determination of an application under s.79 of the Family Law Act is set out in a passage found in the Full Court’s decision in Hickey & Hickey & Attorney-General of the Commonwealth of Australia (Intervener) (2003) FLC 93-143 at 39.
The Full Court states that there are four inter-related steps:
a)Identify and value the property, liabilities and financial resources of the parties; and
b)Identify and assess the contributions of the parties and express them as a percentage of the net value of the property; and
c)Identify and assess the other facts relevant under s.79(4)(d)-(g) including s.75(2) and determine the adjustment (if any) to be made to the contribution entitlements at step two; and
d)Consider the effect of the above and resolve what order is just and equitable in all the circumstances.
One of the legal issues that arises is whether I should adopt a global or asset-by-asset approach to contribution. The authority in this regard is the High Court’s decision in Norbis v Norbis (1986) 161 CLR 513 per Wilson and Dawson JJ at 534-5. It is clear from this statement of the law that either approach is available to me, in part or in whole. My discretion in this regard should be exercised having regard to the facts of this case.
Pool of assets and liabilities
At the hearing I was provided with a list of assets and liabilities prepared by Mr Davidson, counsel for the wife. Apart from the values of the properties, it is not necessarily a document that is agreed between the parties. It does, however, seem to represent in table form values that the parties themselves have adopted in their respective financial statements. There is no challenge to these figures, so I adopt them in the absence of any contrary evidence. The figure for the husband’s cash i.e. $300,000 is the evidence he gave in cross-examination.
Assets
| Asset | Possession | Husband’s Value ($) | Wife’s Value ($) | Agreed Value/Total ($) |
| 1. Property [Y] | W | 1,000,000 | ||
| 2. Property [X] | H | 300,000 | ||
| 3. Husband’s Super | H | 253,271 | 253,271 | |
| 4. Wife’s Super | W | 77,411 | 77,411 | |
| 5. Husband’s vehicle | H | 1,300 | 1,300 | |
| 6. Wife’s Vehicle | W | 20,000 | 20,000 | |
| 7. Husband’s cash | H | 300,000 | 300,000 | |
| 8. Wife’s cash | W | 35 | 35 | |
| 9. Husband’s personal effects | H | 9,500 (total) | 9,500 | |
| 10. Wife’s personal effects | W | 23,000 (total) | 23,000 | |
| 11. Husband’s shares | H | 5,171 | 5,171 | |
| 12. Wife’s shares | W | Nil | Nil | |
| TOTAL | 1,989,688 |
Liabilities
| Liability | Possession | Husband’s Value | Wife’s Value | Agreed Value/Total |
| 13. Mortgage – Property [Y] | H and W (but being paid by Wife) | 10,782 | 10,782 | 21,564 |
| 14. Mortgage (taken after divorce) – Property [X] | H | Not provided | N/K | Assumed Nil |
| 15. Husband’s personal loans/unpaid utilities | H | Nil | Nil | |
| 16. Wife’s personal loans/unpaid utilities | W | 9,900 20,910 | 9,900 20,910 | |
| 17. Husband’s vehicle loan/hire purchase | H | Nil | Nil | |
| 18. Wife’s vehicle loan/hire purchase | W | 37,000 | 37,000 | |
| 19. Husband’s tax liability | H | Nil | Nil | |
| 20. Wife’s unpaid tax liability | W | 2,451 17,740 | 2,451 17,740 | |
| 21. Husband’s credit cards | H | 779 | 779 | |
| 22. Wife’s credit cards | W | 18,875 | 18,875 | |
| 23. Husband’s outstanding legal expenses | H | Nil | Nil | |
| 24. Wife’s anticipated outstanding legal expenses | W | 29,000 | 29,000 | |
| TOTAL | 11,561 | 146,658 | 158,219 |
I make the following findings about this pool of assets and liabilities:
·Items 1 and 2 clearly existed at the date of separation, but I have no evidence about values at that time;
·Item 3 existed in part at the date of separation, and will need to be dealt with separately;
·Item 7 represents the proceeds of a post-separation inheritance received by the husband;
·I have no evidence about whether items 4, 5, 6, 8, 9, 10 and 11 existed at separation. I infer that they came into existence after separation.
·Item 13 is the current value of a debt which existed at separation but which was then valued at $91,000;
·Items 16, 18, 19, 20 and 21 seem to be post-separation debts.
Post-separation contribution
At the time of separation the wife and children continued to occupy [Y]. Three of the children were under the age of 18. There were periods when there was no formal assessment of child support. She asserts that there were periods when the husband was either unemployed, or not fully employed, and therefore did not pay child support, and thus she was solely responsible for meeting the expenses of the children. She took in boarders from the nearby University to supplement her own income. Whilst the husband certainly spent time with the children, she asserts she was still their primary carer. She paid the mortgage on [Y]. In April 1999 a major hailstorm caused severe damage to the home. Not only did this cause considerable stress and inconvenience to the family, but the wife paid out about $10,000 in additional expenses not covered by the insurer. In addition the wife had to take time off work to supervise repairs. The wife was also solely responsible for maintaining and repairing the property, including painting, plumbing, electrical works, replacing the hot water system and internal doors and repairing the balcony.
The husband’s evidence about his post-separation contribution presents a slightly different picture. He asserts, and indeed the wife agreed in cross-examination, that he continued to pay child support even when he was unemployed or not fully employed. He refers to the wife’s own assertion in her application for dissolution of marriage in 1994 that:
“The husband pays all school fees, private medical and hospital insurance cover at the family rate, contributes towards the cost of clothing and shoes and pays a minimum of $500.00 per month maintenance for the children”. (paragraph 75)
Thus, even the wife acknowledged that he was making financial contributions at this stage. He asserts, and the wife agreed in cross-examination, that up until his remarriage in 1997 the wife had access to their shared cheque account in respect of which he was the only person to make deposits. She also agreed that she used, for some time, credit cards that the husband paid. Indeed the evidence indicates that in the
12 month period ending 12 May 1997 the wife had incurred $3,900 in expenses on a credit card that he paid.
The husband’s evidence, not challenged by the wife, is that after separation the wife took on responsibility for the [Y] property and its mortgage, and ceased to make any deposits into their shared accounts. His responsibility was to take over all payments on the Communication Credit Union loan, Westpac Mastercards and Visa Card, AMEX card and the Westpac Cash Management account. I have no evidence, however, about how much was owed on these facilities at the date of separation, though the husband asserts that by 2004 it was still $73,000. The husband’s evidence is that it was not until he received the inheritance from the estate of his late parents in December 2004 and January 2006 that he was able to completely clear these debts. Indeed his evidence is that his income during that period did not enable him to even properly service those debts, together with provide the wife with the further support that he provided to her, without actually borrowing more on these facilities. He agrees that he provided no financial support to the wife in consequence of the hailstorm and asserts that was because he was in such debt. It is important to re-state that the evidence of husband about these matters was unchallenged.
The wife quantifies the expenses she incurred in relation to the [Y] property between 1993-2007 at $229,437. This was not challenged by the husband. It is interesting to note, however, that over a period of 14 years, this converts to about $315 per week. The husband submits that the wife had the benefit of occupying the home throughout this period, and whilst he is not able to quantify the value to the wife of this benefit, it is not a benefit that I can ignore and I am obliged to consider it as part of his post-separation contribution.
Assessing the weight to be given to diverse contributions over a very lengthy period of separation is an exercise fraught with difficulty and uncertainty. There is no surgeon’s scalpel available to me with which to make fine dissections about contributions made, and then attempt to measure and weigh them in some scientific manner. And even if I could, would I weigh it by reference to present values or past values? Is it measured as a contribution in dollar terms or percentage terms? And how do I factor in such a significant effluxion of time during which both parties simply got on with their lives, and so many other things have happened beyond their control? For example during this period the husband remarried and received a considerable inheritance. The children became independent. The wife appears to have established a successful accountancy business. I take judicial notice of significant increase in the value of real estate in New South Wales over this period which would have happened in spite of whatever the parties did, and not because of it.
Applying a percentage to both properties appears to me to be the least unsatisfactory method of trying to achieve justice and equity between these parties. Because of what I assess to be the significant post-separation contributions of the wife to the conservation and improvement of the [Y] property, and to the welfare of the family, which exceeds the husband’s own post-separation contributions in this regard, I assess the wife to receive an extra 10% attributable to post-separation contribution, to be applied to both properties. It should be applied to both properties because it would be unjust to limit the wife’s post-separation contribution to the welfare of the family to one property alone.
I foreshadowed the prospect of adopting an asset by asset approach to assessing contribution in this case. I believe this is necessary because of the extraordinary long period since separation which has meant that both parties have acquired assets and liabilities that are not attributable to the other’s contribution. The result of an asset by asset approach is as follows:
a)[Y] and [X]. The wife should receive a 60% interest in both these properties, subject to the mortgage.
b)Husband’s superannuation. His affidavit filed 18 July 2008 refers to his various superannuation entitlements and how they were derived. This evidence is far from clear, but it was not challenged by the wife. Doing the best I can in the face of this uncertainty it seems as if:
·At least past of the Legal & General Supertrace Eligible Rollover fund of $55,912 was attributable to a pre-marriage membership of the fund. As we are now considering periods going back well over 30 years, to give weight to this contribution is highly problematic. I will apply the 60% contribution figure in favour of the wife to this fund in its entirety;
·The Reoflex Holidays Pty Ltd Super Fund of $91,548 was clearly attributable to post-cohabitation contribution, though possibly also encompasses post-separation contribution as well. If this was the case the husband could have produced evidence to satisfy me of this. As he has not, I will apply the 60% figure to this fund as well.
·The remaining superannuation funds totalling $105,811 are clearly post-separation contributions by the husband. As the wife has made no contribution to this, I will apportion all of it to the husband.
c)Wife’s superannuation. The wife’s superannuation is clearly the result of her post-separation contributions to which the husband made no contribution. I will apportion all of it to the wife.
d)Motor vehicles. In the absence of any evidence about this, having regards to the very long period since separation, I will treat these as post-separation acquisitions of each party to which neither made contributions. Each should retain these items.
e)Husband and wife’s cash. The husband’s cash is entirely attributable to inheritances received well after separation. The wife made no contribution to this fund. There are ample other assets out of which the wife’s s.79 entitlement can be apportioned in a just and equitable manner. I will apportion all of these funds to the husband. The wife will retain her own cash.
f)Husband and wife’s personal effects and shares. In the absence of any evidence about this, and having regard to the very long period since separation, I will treat these as the post-separation acquisitions of each party to which the other made no contribution. Each will retain their own effects and shares.
g)Mortgage over [Y]. This is obviously a joint debt the value of which should be deducted from this property before allocation between the parties.
h)Personal liabilities of the husband and the wife. It is almost irrefutable that these are post-separation liabilities of each party and it is appropriate that they each remain responsible for same.
A section 75(2) adjustment in favour of the wife?
The wife seeks what her counsel described as “a not inconsiderable adjustment” for s.75(2) factors because of the disparity in the parties income, property and resources and their capacity for employment (s.75(2)(b)), and also to give the wife a standard of living that is in all the circumstances reasonable (s.75(2)(g)). The husband submits that having regard to their comparative ages (he is 61 and she is 55) no adjustment is necessary: (s.75(2)(a)).
The husband has an average weekly income of $2149, compared to that of the wife, $956. That significant disparity is something I might otherwise need to take into account. Despite the husband’s age, he indicated to me that he has no intention to retire.
But this is off-set by the wife’s entitlement pursuant to the order I intend to make to reflect her contribution: s.75(2)(n). When the wife receives 60% of the net value of the real estate ($1,300,000 less 21,564 = $1,278,436 at 60% = $767,061) the fundamental nature of the parties’ balance sheet changes, and her position becomes much stronger. Under these circumstances no adjustment is necessary.
Outcome of contribution and s.75(2) adjustment
The final outcome depends on the particular asset.
(1)The wife should receive a 60% interest in the net value of the [Y] and [X] properties.
(2)The wife should receive a 60% interest in the Legal & General Supertrace Eligible Rollover Fund of $55,912 and Reoflex Holdings Pty Ltd Super Fund of $91,548.
(3)The husband and the wife should each otherwise retain all their respective assets and their liabilities without adjustment.
The numerical outcome of this is as follows:
·Net value of real estate is $1,300,000 minus $21,564 = $1,278,436.
Wife receives 60% = $767,061
·Value of superannuation is $147,460.
Wife receives 60% = $88,476
Total $855,537
No splitting order was sought as regards superannuation, so the adjustment needs to be made as against real estate only. It is clear that the wife wishes to retain [Y]. If she assumes responsibility for the existing mortgage debt of $21,564, that means the equity is $978,436. As her entitlement pursuant to this judgment is $855,537 it means she will have to pay to the husband $122,899 in order to retain the home. I believe that is achievable for her, even taking into account the personal liabilities she has. It is not much more than what she herself proposed. The husband did not express opposition in principle to the concept of giving to the wife time to pay. Indeed in his Response filed 18 July 2008 he proposed 12 months, though he was clearly expecting a much larger payment to him. I will adopt the 12 month period suggested by him, but make orders to ensure in the meantime that the wife is solely responsible for paying the mortgage and outgoings on the [Y] property.
The husband will be left with the following:
[X]
300,000
Superannuation
253,271
Cash
300,000
Payment from Wife
122,899
976,170
together with his personal effects, shares and vehicle. I consider that a just and equitable result as well.
Conclusion
It is quite possible that neither party will be pleased with the orders I make. I specifically said to both of them at the hearing that, in all likelihood if they did not settle this case themselves, neither would be pleased with my decision. The civility that exists between these parties has now subsisted for over 33 years. It has survived cohabitation, marriage, childrearing, separation, divorce, natural disaster and now litigation. One hopes that their civility will now survive my judgement and the orders I make. I understand that there was a wedding for one of their children on 6 September 2008. I hope it was an occasion to celebrate the enduring joys of parenthood, and not lament the lingering pain of a marriage that broke down 17 years ago.
I certify that the preceding forty (40) paragraphs are a true copy of the reasons for judgment of Altobelli FM
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Date:
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