MB v PK
[2008] QSC 291
•21 November 2008
SUPREME COURT OF QUEENSLAND
CITATION:
MB v PK [2008] QSC 291
PARTIES:
MB
(applicant)
AND
PK
(respondent)
FILE NO/S:
2291 of 2007
DIVISION:
Trial
PROCEEDING:
Originating Application
ORIGINATING COURT:
Supreme Court
DELIVERED ON:
21 November 2008
DELIVERED AT:
Brisbane
HEARING DATE:
22 July 2008
JUDGE:
Atkinson J
ORDER:
1. Upon sale of the property at 34 Coast View Parade, Doonan, more particularly described as Lot 3 SP 103493 in the County of Canning, Parish of Maroochy, the net monies be distributed as follows: 60% to the applicant and 40% to the respondent. Any arrears owing on the mortgage at sale are to be paid from the respondent’s share.
2. Except as otherwise provided by this order, each of the applicant and the respondent to retain for their benefit absolutely all assets, chattels or financial resources in their respective possession, power or control, including but not limited to motor vehicles, personal effects or superannuation held in their names.
CATCHWORDS:
FAMILY LAW AND CHILD WELFARE – DE FACTO RELATIONSHIPS – ADJUSTMENT OF PROPERTY INTERESTS – PARTICULAR CASES – where the parties had been in a de facto relationship for approximately 18 years – where the couple had four children together – where identification of value of resources was hampered by lack of evidence – where the parties’ major asset is a home –what is a just and equitable distribution of the property in the circumstances
Family Law Act 1975 (Cth), s 75, s 79
Property Law Act 1974 (Qld), s 38, s 263, s 283, s 286, s 289, s 291, s 292, s 293, s 294, s 295, s 296, s 297, s 298, s 299, s 300, s 301, s 302, s 303, s 304, s 305, s 306, s 307, s 308, s 309, s 337
Davut and Raif (1994) FLC 92-503, cited
FO v HAF [2006] QCA 555, cited
HAG v MAW [2007] QCA 217, cited
Hickey v Hickey (2003) FLC 93-143, applied
In the Marriage of Lenehan (1987) 11 Fam LR 615, cited
Kardos v Sarbutt [2006] NSWCA 11, cited
Pierce v Pierce (1998) FLC 92-844, applied
Norbis v Norbis (1986) 161 CLR 513, cited
COUNSEL:
TF Jordan for MB
PK in person
SOLICITORS:
Schultz Toomey O’Brien Solicitors for the applicant
PK in person
This was an application by Ms MB for property distribution at the end of the de facto relationship between herself and Mr PK.
There is no dispute that MB and PK had been in a de facto relationship,[1] which commenced in March 1988 and finished in April 2006. The couple had four children together, BB born 25 May 1992, RB born 6 January 1994, KB born 4 December 1996 and JB born 24 June 1999.
[1]Property Law Act 1974 (Qld) PLA s 261 provides that a “de facto relationship” is the relationship between de facto partners; s 260 of the PLA provides that a reference to a “de facto partner” is a reference, inter alia to s 32DA of the Acts Interpretation Act 1954 (Qld).
Application for property distribution
An application for a just and equitable property distribution at the end of such a relationship is made pursuant to s 283 of the Property Law Act 1974 (Qld) (PLA) which provides that after a de facto relationship has ended, a de facto partner may apply to the court for an order adjusting interests in the property of either or both of the de facto partners. Section 289 of the PLA provides that each party to a proceeding for a property adjustment order must disclose that party’s financial circumstances as required by the court. The section also provides that a court may make a property adjustment order in favour of a party only if the party has complied with the requirement to disclose that party’s financial circumstances.
The court is empowered under s 286(1) to make any order it considers just and equitable about the property of either or both of the de facto partners adjusting the interests of those partners in the property. This is similar to the power of the Family Court under s 79(2) of the Family Law Act 1975 (FLA). The court exercising its powers under the PLA is required, in deciding what is just and equitable pursuant to s 286(2), to consider the matters listed in subsubdivision 3 of subdivision 2 of Division 4 of Part 19 of the PLA.
In determining what orders are necessary to effect a just and equitable distribution of property it is necessary to consider each of the relevant statutory factors. The Court of Appeal in FO v HAF[2] referred with approval to the approach of the Family Court to the exercise of discretion found in the equivalent section to s 286(1) of the PLA:
“It has frequently been emphasised that the judicial discretion conferred by s 286(1) of the PLA and its analogues in other statutes should not be constrained by pre-determined guidelines.[3] It is essential however, that the matters referred to in the provisions set out above be taken into account, and that they are ‘seen, in the reasons for judgment, to have been taken into account’.[4] To this end, the four step approach explained by the Full Court of the Family Court in Hickey v Hickey[5] provides a useful discipline to ensure clarity of thought and transparency of judicial reasons.
The Full Court of the Family Court explained in Hickey and Hickey,[6] in relation to the Family Court Act analogue of pt 19 of the PLA, that the first step in making a property adjustment order is the identification and valuation of the property, resources and liabilities of the parties. The second step is the identification and assessment of the contributions of the parties to their pool of assets and the determination of their contribution-based entitlements in accordance with s 291 to s 295 of the PLA. The third step is the identification and assessment of the factors in s 297 to s 309 of the PLA to determine the adjustment to the contribution-based entitlement. The fourth step in the process is consideration of the result of these earlier steps to determine whether that result is just and equitable in accordance with s 286 of the PLA.”
[2][2006] QCA 555 at [51]-[52].
[3]Norbis v Norbis (1986) 161 CLR 513; In the Marriage of Lenehan (1987) 11 Fam LR 615; Kardos v Sarbutt [2006] NSWCA 11 at [51].
[4]Davut and Raif (1994) FLC 92-503 at 81, 237.
[5](2003) FLC 93-143 at 78,386, cf Kardos v Sarbutt [2006] NSWCA 11 at [28]-[29].
[6](2003) FLC 93-143 at 78,386.
Identification and valuation of the property, resources and liabilities of the parties
Identification and valuation of the property, resources and liabilities of the parties in this case has been hampered by a lack of precise and current evidence as to those matters. PK’s evidence in particular as to his business and earnings was inadequate and contradictory.
The position at the start of the de facto relationship
When the parties commenced their de facto relationship in 1988, MB was employed as an office worker earning approximately $20,000 per year and PK was an apprentice builder/carpenter with a comparable income and approximately $25,000 in savings. MB had a motor vehicle and some furniture. PK also had a motor vehicle but it was unroadworthy and unregistered.
The home at Doonan
The major asset of the relationship is a home, which is not fully completed, on a property at 34 Coast View Parade, Doonan, more particularly described as Lot 3 SP 103493 in the County of Canning, Parish of Maroochy in the State of Queensland (the “Doonan property”). The house on the Doonan property has five bedrooms, four bathrooms, two studies, two garages, three balconies and very large living areas. The parties agreed on the extent of the works that remain to be completed. They estimate that it is 95 per cent completed. The land is registered solely in the name of MB.
On 22 February 2008 the Supreme Court ordered[7] that Robert Phillips of Robert Phillips Solicitors be appointed trustee for the sale of the Doonan property. PK currently resides in the home on the Doonan property, which is on the market for $950,000, a sum at which it was apparently valued on an “as is” basis on 9 January 2008. The trustee is doubtful as to whether the list price of $950,000 is realistic in the current market, notwithstanding the valuation. The valuation was not put in evidence before me.
[7]Pursuant to s 38 PLA.
By the time of trial, one written offer and one informal offer to purchase the Doonan property had been received. On 30 April 2008, a signed written offer to buy the property for $450,000 was received by a buyer through Noosa Realty. The buyer had no interest in the property at $950,000. On 1 May 2008, a prospective purchaser advised that the maximum amount she would be prepared to pay was $700,000, subject to an engineering report. In light of the valuation, the agent was advised by the trustee that this offer was not acceptable. I do not accept that the current market value of the Doonan property is $950,000.
The Doonan property is subject to a mortgage. The evidence showed a Viridian Line of Credit account number 4439 10179049 with a balance in February 2008 of $274,574.51 and a balance at 2 June 2008 of $279,916.96.[8] Between 1 February 2008 and 2 June 2008, four payments were made by PK totalling $4,325.
[8]Affidavit of applicant filed 16 July 2008, Annexure J.
PK stated in his affidavit filed 13 July 2008, as a note to the current mortgage amount of approximately $280,000, that three loans had been taken out between April 2004 and December 2006, but does not reveal which institution provided the loans. During cross-examination by Mr Jordan, PK said that the payments received into the Commonwealth Bank account from Perpetual Trustees are “draw downs” from a building construction loan of approximately $225,000.[9] PK said in cross examination that the “draw down” sums were not used for living expenses and were only for the construction of the home.
[9]Affidavit of applicant filed 16 July 2008, Annexure E.
The business
Sometime in 2000-2001, MB and PK commenced a business known as “South East Queensland Home and Building Reports” (the “business”). PK conducted pre-purchase inspections and MB typed up the reports and carried out administrative and basic office duties. PK wrote approximately four reports per month at the commencement of the business, and this grew to eight to ten reports per month. The charge for each report was approximately $350. In a letter to MB’s solicitors dated 12 November 2007, PK nominated Onus Maynes of Evidex to conduct the valuation of the business.[10] It appears that PK was not prepared to pay a 50 per cent share of the cost of the valuation and that, as a result, no valuation was carried out. The value of the business known as “South East Queensland Home and Building Reports” is therefore unknown. It clearly has some value, both as a going concern and as a future source of income for PK.
[10]Affidavit of respondent filed 15 January 2008, Annexure F.
Motor vehicles
MB has in her possession a 1998 six seater AU Falcon Station Wagon valued at $4,200, PK has in his possession a 1992 GQ Nissan Patrol 4WD Station Wagon accepted by MB for negotiation purposes as being worth $4,000 and a 1996 Kawasaki ZZR 1100 accepted by MB for negotiation purposes as being worth $2,500.[11] These latter two values were the values nominated by PK.
[11]Affidavit of the respondent filed 15 January 2008, Annexure E.
Furniture
The parties do not agree about the value of furniture that each has in their possession. In his affidavit filed 15 January 2008, PK states that he values the furniture in MB’s possession at $29,050. On 4 October 2007, MB valued her furniture, excluding jewellery at $870.
MB’s schedule of the estimate of furniture and other household goods to be relied upon for mediation purposes assigns a total value of $5,455 to her holdings and $14,180 to PK’s holdings.[12]
[12]Affidavit of the respondent filed 15 January 2008, Annexure G.
Tools and equipment
PK has in his possession tools and equipment which he asserts are worth $5,000.
Applicant’s jewellery
MB’s jewellery is referred to in correspondence between PK and the applicant’s solicitors. An amount of $1,000 has been listed as the value of this jewellery in her schedule of the estimate of chattels provided to PK.
Superannuation
MB has $2,000 in superannuation and PK swore in his affidavit dated 13 July 2007 that he had superannuation of $20,000. However, a statement from his superannuation fund which formed part of Exhibit 3 showed that, as at 31 March 2008, he had $42,966.90 in superannuation and that, as at 1 July 2007, his superannuation was in fact $44,671.44 and not $20, 000 as he had sworn it to be.
Income of PK
PK’s income is difficult to determine accurately. It appears that his income tax returns are not an accurate reflection of his business income and expenditure. In cross-examination, Mr Jordan took PK to his 2004/2005 income tax return. PK agreed that his gross business income in 2004/2005 was $130,940. He said that the income was from building reports and building construction, although he was unable to say how much could be attributed specifically to either of these activities.
PK asserted that in the year when his income was $130,940, his total expenses were $136,901, thus resulting in a net loss of $5,961. PK said that the expenses were construction materials but did not include money spent on the construction of the Doonan property. In view of the fact that he was at that time building an expensive home at Doonan and supporting MB and four children, and his business expenses exceeded his business income, this evidence is very difficult to accept. This is particularly so in view of the fact that the previous financial year’s income tax return showed an income of $98,000 with expenses of $94,000. His explanation was that the family survived on a $200 a week wage paid to him out of what was described in his income tax return as materials and supplies, together with Commonwealth government benefits. It appears that in fact the materials and supplies claimed as a tax deduction were to cover the cost of the material and supplies used to build the home at Doonan. His income tax returns are not reliable as to his income and expenses.
PK’s evidence was that he did not know his current income, but that his weekly income to support himself was still $200. When asked about the deposits from Perpetual Trustees into the Commonwealth Bank account, PK stated that these amounts are “draw downs” from the building construction loan.
From March 2008 to August 2008 MB worked on a contract basis for the Sunshine Coast Regional Council at Noosa, receiving $379 gross per week. There was no likelihood of the contract being renewed. At that time MB also received $446 gross per week in government benefits. Before March 2008, MB’s sole source of income was $530 per week from a sole parent’s pension.
In summary, the couple’s present assets include the Doonan property, the business, superannuation of $2,000 for MB and $43,000 for PK, as well as furniture, jewellery, motor vehicle and tools. The only asset available to achieve a just and equitable distribution of property between the parties is the Doonan property.
Identification and assessment of the contributions of the parties
The contributions, financial and non-financial, made by each of the parties to the welfare, property and financial resources of the couple and the effect of an order on their future earning capacity are set out in subsubdivision 3 of subdivision 2 of Division 4 of Part 19 of the PLA. Those matters specifically are:
· The financial contributions made directly or indirectly by or for the de facto partners or a child of the de facto partners to the acquisition, conservation or improvement of any of the property of either or both of the de facto partners (PLA s 291(1)(a));[13]
[13]cf FLA s 79(4)(a).
· The financial contributions made directly or indirectly by or for the de facto partners or a child of the de facto partners to the financial resources of either or both of the de facto partners (PLA s 291(1)(b));
· The non-financial contributions made directly or indirectly by or for the de facto partners or a child of the de facto partners to the acquisition, conservation or improvement of any of the property of either or both of the de facto partners (PLA s 291(1)(a));[14]
[14]cf FLA s 79(4)(b); however, the non-financial contributions of a child of the de facto partners must be considered only if the child’s contributions are substantial (PLA s 291(2)). There are no relevant contributions by the children in this case.
· The non-financial contributions made directly or indirectly by or for the de facto partners or a child of the de facto partners to the financial resources of either or both of the de facto partners (PLA s 291(1)(b));
· The contributions, including any homemaking or parenting contributions, made by either of the de facto partners or a child of the de facto partners to the welfare of the de facto partners or the family consisting of the de facto partners and one or more children of the de facto (PLA s 292);[15]
[15]cf FLA s 79(4)(c); the family can also consist of a person accepted into the household by one of the de facto partners who is dependent (PLA s 292(1)(b)(ii)).
· The effect of any proposed order on the earning capacity of the de facto partners (PLA s 293);[16]
· Any child support under the Child Support (Assessment) Act 1989 (Cwlth) provided, or to be provided, by a de facto partner for a child of the de facto partners (PLA s 294);[17]
· Any other order affecting a de facto partner or a child of the de facto partners made under a law of the Commonwealth or a State concerning de facto relationships the court considers should be taken into account (PLA s 295);[18]
[16]cf FLA s 79(4)(d).
[17]cf FLA s 79(4)(g).
[18]cf FLA s 79(4)(f).
Financial contributions to property (PLA s 291(1)(a))
In November 1990 PK purchased the de facto couple’s first home at 5 Ailsa Court, Albany Creek (the “Albany Creek property”) for $110,000 with a deposit of $25,000 from his own savings. As at 25 May 1992, the Albany Creek property was valued at $120,000 with a mortgage of $85,000. It was sold for approximately $130,000 in December 1996.
According to PK, vacant land at 125 Jensen Road, Yandina (the “Yandina land”) was purchased on 6 December 1996 for $66,000, with $46,000 from the sale of the Albany Creek property and a mortgage of $20,000. PK was solely responsible for the mortgage payments. In April 1997 a construction loan of $100,00 was taken out to build a home on the Yandina land. This property was sold for $280,000.
In December 2002 the land at Doonan was purchased for $141,000 apparently from the proceeds of the sale of the Yandina land. The Doonan property was purchased in MB’s name apparently to protect the property from the possibility of any legal action associated with the business. PK and MB then commenced building a home on the vacant land. In February 2003, the initial construction costs of $39,000 for the home were paid from the proceeds of the sale of the Yandina land.
From April 2004 to December 2006 three loans were taken out, totalling $280,000, to construct the home at Doonan (the first loan was $175,500; the second loan was $56,500 and the third loan combined loans 1 and 2 and provided extra monies for further completion). The mortgage payments for these loans were paid solely by PK until November 2006.
In late 2004, the home at Doonan was sufficiently constructed for the family to be able to move into it. Substantial work was still required to be carried out for the home to be completed. By the time of trial, the home had still not been fully completed. PK accepted that at the time of separation the mortgage was $240,605 and by July 2008 it was $279,916. PK said he had made about $10,000 of repayments on the new loan.
Financial contributions to the financial resources (PLA s 291(1)(b))
At the commencement of the relationship in March 1988, MB had a motor vehicle and some furniture and was employed as an office worker earning approximately $20,000 per year. PK had savings of approximately $25,000 and was an apprentice builder/carpenter earning a similar salary. PK did not hold a driver’s licence and MB was required to drive him. MB continued to work up until BB’s birth in May 1992, thereafter becoming the primary carer of the children. Until 2001, PK worked on as a builder providing all of the family income, except for any benefits received from Centrelink.[19]
[19]For example, in approximately 2001 when the South East Queensland Home and Building Reports business was being established, MB received a Centrelink benefit of approximately $490 per fortnight-Affidavit of the applicant filed 16 July 2008 at [16].
Non-financial contributions to property (PLA s 291(1)(a))
Both parties made non-financial contributions to the acquisition, conservation and improvement of their properties at Yandina and Doonan.
PK spent many hours building the home on the Doonan property. He estimated that he spent 122 weeks constructing the home until the time of separation and about 1350 hours since separation on 21 April 2006.[20]
[20]Affidavit of the applicant filed on 13 July 2007 at [27].
Essentially MB took responsibility for design and interiors, while PK did significant building work, subcontracting some of the electrical and plumbing work. MB also assisted in some of the many tasks involved in the building and landscaping.
In approximately 2001 MB and PK started and ran the business. By 2004 MB and PK ran the business from the Doonan property. PK was responsible for carrying out the pre-inspection reports, while MB performed office tasks of an administrative nature.
Contributions, including homemaking or parenting contributions, to the family (PLA s 292)
Throughout the relationship, MB was the primary homemaker and caregiver to the couple’s children. This freed PK to devote more time to his paid work and building the couple’s homes.
In late September/October 2003, MB was diagnosed with stage three aggressive breast cancer and underwent treatment for 12 months. During that time MB continued to be the primary carer of the children and also continued assisting PK with the business.
On 21 April 2006, MB moved out of the Doonan property, taking with her children RB, KB and JB. For approximately eight weeks MB and these three children lived with MB’s parents at Yandina, until MB found rental accommodation. BB stayed at the Doonan property with PK. Since then MB has substantially supported the children who resided with her and PK has supported the child who resided with him and paid the expenses of the other children when they have been in his care. There is no doubt that the responsibility for the children, both financial and otherwise, has been shared since separation but MB has taken a higher share of that responsibility.
Effect on future earning capacity (PLA s 293)
It would not be useful to attempt to sell the business so that this will remain a resource for PK in terms of his earning capacity.
Any child support (PLA s 294)
MB receives no financial assistance from PK in terms of any assessment from the child support agency. PK acknowledges that he makes no contribution in respect of food, clothing and other attendant expenses in MB’s household. PK said that he paid for the children’s upkeep when they were in his household, but had not, and would not, make any contribution to the children when they were in the applicant’s household. PK paid for the children’s school fees and for expenses associated with their leisure activities.
Any relevant court order (PLA s 295)
An order by the Federal Magistrates’ Court made on 28 February 2008 set out certain requirements in relation to undertakings by both MB and PK, and consent orders in relation to the amount of time that each child should spend with each parent. By consent it was ordered that KB and JB should live with MB; RB should spend equal time with MB and PK in their respective households; both have equal shared parental responsibility in relation to the children; that both spend time and communicate with BB at all reasonable times as may be agreed between the parties and in consultation with BB from time to time. Specific arrangements for Christmas and birthdays were also detailed in the consent order.
In the Supreme Court on 22 February 2008, Daubney J ordered that, pursuant to s 38 of the PLA, Robert Phillips of Robert Phillips Solicitors be appointed as trustee for sale of the Doonan property.
On 22 February 2008, PK undertook to the Court that he would cooperate fully to properly effect the listing for sale and sale of the Doonan property and that upon the exhaustion of the current line of credit with the Commonwealth Bank he would personally meet the mortgage repayments for the Doonan property and make any arrears good. However, by the time of trial, the land had not sold.
A consideration of the financial and non-financial contributions of the parties and all of the other matters set out in subsubdivision 3 suggests that the appropriate distribution of the proceeds of the sale of the only asset available for property distribution between the parties, the Doonan property, is 55 per cent to the applicant MB and 45 per cent to the respondent PK. PK will retain the business and his superannuation.
Identification and assessment of the factors in s 297 to s 309 of PLA
Subsubdivision 4 sets out the additional matters for consideration to the relevant extent in deciding what is just and equitable.[21] Additional matters for consideration in subsubdivision 4 include:
· The age and state of health of each of the de facto partners (PLA s 297);[22]
[21]PLA s 296.
[22]cf s 75(2)(a).
MB was born on 1 May 1961 and PK was born on 8 March 1965. As previously mentioned, in late September-October 2003 MB was diagnosed with breast cancer and underwent 12 months of treatment including chemotherapy and radiotherapy. Treatment ceased in September 2004. MB has regular checkups every three months and a full series of checkups, including mammograms, blood tests and ultrasounds, annually. To date the checkups have been successful and MB is in good health. It would appear that PK is in good health.
· The income, property and financial resources[23] of each of the de facto partners (PLA s 298(a));[24]
[23]Financial resources are defined under s 263 of the PLA as follows:
“A person’s financial resources include the following -
(a) a prospective claim or entitlement under a scheme, fund or arrangement under which superannuation, resignation, termination, retirement or similar benefits are provided to, or in relation to, the person;
(b) property that, under a discretionary trust, may become vested in, or applied to the benefit of, the person;
(c) property the disposition of which is wholly or partly under the control of the person and that may be used or applied by or on behalf of the person for the person’s benefit;
(d)any other valuable benefit of the person.”
[24]cf FLA s 75(2)(b).
In March 2008 MB secured a six month contract with the Sunshine Coast Regional Council at Noosa. This contract was due to end in August 2008 with no likelihood of renewal. PK is a builder and can continue to operate the business.
· The physical and mental capacity of each of the de facto parents for appropriate gainful employment (PLA s 298(b));[25]
[25]cf FLA s 75(2)(b).
MB has been out of the formal work force since 1992, a period of 16 years. During that time she has performed typing and administrative duties for the family business. This time out of the paid work force outside the home has of course adversely affected her employability.
PK retains his building and business skills and he has been employed as a builder, and conducted building inspections throughout the period of cohabitation and since. It would appear that PK has significant capacity to work and earn income particularly as he has the capacity to continue the business.
· Whether either de facto partner has the care of a child of the de facto spouses who is under 18 years (PLA s 299);[26]
[26]cf FLA s 75(2)(c).
As previously mentioned, the couple had four children together, BB born 25 May 1992, RB born 6 January 1994, KB born 4 December 1996 and JB born 24 June 1999. Under the terms of the Federal Magistrates Court Order of 28 February 2008, KB and JB live with MB; and RB spends equal time with MB and PK in their respective households; and both parents spend time and communicate with BB at all reasonable times as agreed.
There is some discrepancy between the views of MB and PK regarding the amount of time that the children spend with each parent. In the view of MB, since separation the children RB, KB and JB have lived with her. PK states that BB is in his care 98% of the time, RB 51%, KB 36% and JB 36%.[27]
[27]Affidavit of respondent filed 15 January 2008 at [14].
During his cross-examination, PK agreed that it is now the case that BB is now effectively 50/50 with each parent and appeared to agree that there is also a 50/50 arrangement with RB. PK agreed that KB lives with the applicant exclusively and that JB primarily resides with MB but spends substantial time with the respondent. From PK’s perspective JB is 43% with him and 57% with MB.
After considering all of the evidence, I accept that MB has the fulltime care of KB and JB and fifty per cent of the care of RB and BB.
The commitments of each of the de facto partners necessary to enable the de facto partner to support himself or herself (PLA s 300(a));[28]
[28]cf FLA s 75(2)(d)(i).
Neither of the parties have commitments other than those already referred to and the usual needs for accommodation, clothing, food and general living expenses.
The commitments of each of the de facto partners necessary to enable the de facto partner to support a child whom the de facto spouse has a duty to maintain (PLA s 300(b));[29]
[29]cf FLAs 75(2)(d)(ii).
This matter has already been covered.
The responsibility of either de facto partner to support another person (PLA s 301);[30]
[30]cf FLA s 75(2)(e).
This is not relevant.
The eligibility of either de facto partner for an Australian pension, allowance or benefit that is not income tested or a foreign pension, allowance of benefit and the amount of any such pension, allowance or benefit being paid to either de facto partner, disregarding the eligibility of either de facto partner for an Australian pension, allowance or benefit that is income tested and the amount of any such pension, allowance or benefit being paid to either de facto partner.[31] (PLA s 302);[32]
[31]PLA s 302(4)-Whether an Australian pension, allowance or benefit is income tested depends on whether it is an income tested pension, allowance or benefit within the meaning of the Family Law Act 1975 (Cwlth).
[32]cf FLA s 75(2)(f).
This is not relevant.
The standard of living which is reasonable for each of the de facto partners in all the circumstances. (PLA s 303);[33]
[33]cf FLA s 75(2)(g).
It appears that MB has struggled significantly since separation. MB has a family allowance of $530 and rent of $290 per week, leaving $240 per week to the expenses of her household of herself, and the children in her care. The information about the money she has spent on the children, set out by the applicant in her affidavit, shows that it has been a struggle for MB to support herself and her children.
PK still lives in the Doonan property, and has paid no rent. It is difficult to ascertain the income of PK, although he claims it is $200 per week.
The contributions made by either of the de facto partners to the income and earning capacity of the other de facto partner (PLA s 304);[34]
[34]cf FLA s 75(2)(j).
Although the income and liabilities of the business are unknown, it is clear that MB provided the administrative support for the business from when it commenced in approximately 2001, until April 2006, when MB left the family home. MB’s contribution facilitated the earning capacity of PK in this business.
The length of the de facto relationship (PLA s 305);[35]
[35]cf FLA s 75(2)(k).
The de facto relationship commenced in March 1988 and finished when the couple separated on 21 April 2006, a period of 18 years and one month. It was a long relationship. This diminishes the significance of the difference in the initial financial contributions of the parties.[36]
The extent to which the de facto relationship has affected the earning capacity of each of the de facto partners (PLA s 306);[37]
[36]HAG v MAW [2007] QCA 217 per Atkinson J at [20] citing Pierce v Pierce (1998) FLC 92-844.
[37]cf FLA s 75(2)(k).
The care of the four children over the period of the relationship has impacted on MB’s capacity to work. MB assisted with administrative tasks for the family business, but this was not effective in enhancing her capacity to undertake paid employment.
If either de facto partner is cohabiting with another person, the financial circumstances of the cohabitation (PLA s 307);[38]
[38]cf FLA s 75(2)(m).
This is not relevant to this case.
Any payments provided for the maintenance of a child in the care of either de facto partner (PLA s 308);[39]
[39]cf PLA s 75(2)(na) and (p).
PK agreed he had not given any money to the applicant for food to spend in her household for the children since separation, and that he only paid for the children when they were in his care.
Any fact or circumstance which the court considers the justice of the case requires to be taken into account (PLA s 309).[40]
[40]cf FLA s 75(2)(o).
When considering the additional matters for consideration I note that at present both PK and MB are in good health and are of similar age. PK retains an ability to make substantial income as a builder and building inspector, while MB has only been able to find one short term job which has now terminated. MB did not work after the birth of the couple’s first child, instead being primarily responsible for child care and domestic arrangements that supported the household. MB had little chance to maintain or develop skills that would be valuable in the market place.
An assessment of all of the factors set out in subsubdivision 4 favours a further adjustment to the property distribution in favour of MB, so that the net proceeds on the sale of the Doonan property be distributed 60 per cent to MB and 40 per cent to PK.
Consideration of the result of Steps 1-3 to determine whether that result is just and equitable in accordance with s 286 of the PLA
The proposed distribution of net proceeds on the sale of the Doonan property of 60 per cent to MB and 40 per cent to PK is just and equitable, particularly in view of the different capacity of each party to support themselves and their children in the future and the fact that PK will retain the business and has greater superannuation entitlements.
Orders
The type of orders that a court may make are set out in Division 6 of Part 19 of the PLA. The court is given extensive power to ensure that it may make appropriate orders to give effect to a just and equitable distribution of property between the de facto partners. The duty of the court in those circumstances is to make orders that, as far as practicable, will end the financial relationship between the de facto partners (PLA s 337). This requires that the sale of the Doonan property not be further delayed.
MB submitted that the appropriate order was:
1. That upon sale (pursuant to the order of Daubney J made on 22 February 2008) of the Doonan property, the net monies held in the trust account of Klooger Phillips Lawyers, be distributed as follows:
1.1 75 per cent to the applicant
1.2 25 per cent to the respondent subject to order 2 hereof
2. That from the monies the Respondent is to receive pursuant to order 1.2 hereof, the Respondent pay to the Applicant 75 per cent of any arrears of mortgage.
3. That except as provided for in these orders each of the Applicant and the Respondent retain for their benefit absolutely all assets, chattels or financial resources in their respective possession, power or control, including but not limited to motor vehicles, personal effects or superannuation held in their names.
PK did not disagree with the order proposed in para 3. However, with regard to the residence he submitted that it should be dealt with in one of the following three ways:
1. The Respondent “pay out” the Applicant whatever percentage the court determines of the current valuation of the property.
2. The Respondent complete the house and sell the property in 2010 or 2011 if the market has picked up or, if the market has not picked up by then, whenever the market picks up, and then pay the applicant whatever percentage of the net sale price that the court determines.
3. That there be a 50/50 split between the Respondent and the Applicant.
I have weighed all the relevant factors set out in subsubdivision 3 and subsubdivision 4 of subdivision 2 of division 4 of Part 19 of the PLA, to determine the just and equitable distribution of the property. It is critical that the Doonan property be sold without any further delay so that the property distribution take place without further delay.
I order that upon sale (pursuant to the order of Daubney J made on 22 February 2008) of the Doonan property, the net monies held in the trust account of Klooger Phillips Lawyers, be distributed as follows: 60 per cent to the applicant and 40 per cent to the respondent. Any arrears owing on the mortgage at sale are to be paid from the respondent’s share.
I order that otherwise each of the applicant and the respondent retain for their benefit absolutely all assets, chattels or financial resources in their respective possession, power or control, including but not limited to motor vehicles, personal effects or superannuation held in their names.
I will hear further submissions as to further orders to facilitate the prompt sale of the Doonan property and as to costs.
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