McCARRICK and Cohen and Anor
[2019] FCCA 78
•23 January 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| McCARRICK & COHEN & ANOR | [2019] FCCA 78 |
| Catchwords: FAMILY LAW – Property dispute between de facto couple and also brother of the de facto husband – husband and brother both acting less than honestly – wife deceived as to ownership of the property the subject of dispute – wife’s position proceeding on fundamental misunderstanding of the position at law – court finding common intention constructive trust in respect of the property – consideration of whether trust brought to an end – trust ended by de facto husband borrowing $100,000 without authority of his brother – declaration that property owned in equal shares by brothers at that point – wife to receive 70 per cent of husband’s share of the property. |
| Legislation: Family Law Act 1975 (Cth), s.106B |
| Jones v Dunkel (1959) 101 CLR 298 Sylvia (Trustee) v Williams [2018] FCAFC 194 Baumgartner v Baumgartner (1987) 164 CLR 137 Stanford v Stanford [2012] HCA 52 |
| Applicant: | MS MCCARRICK |
| First Respondent: | MR COHEN |
| Second Respondent: | COMPANY A PTY LTD |
| File Number: | DGC 1508 of 2017 |
| Judgment of: | Judge Burchardt |
| Hearing dates: | 14, 15 and 16 November 2018 |
| Date of Last Submission: | 16 November 2018 |
| Delivered at: | Dandenong |
| Delivered on: | 23 January 2019 |
REPRESENTATION
| The Applicant: | In person |
| The First Respondent: | In person |
| Counsel for the Second Respondent: | Mr McInnis |
| Solicitors for the Second Respondent: | Robinson Gill |
ORDERS
THE COURT DECLARES THAT:
In 2000 Mr Cohen, Mr C and their mother jointly agreed to purchase the property at Property B.
It was the common intention of each of the three purchasers that they would jointly own the property.
Mr Cohen was the registered owner of property.
In the circumstances Mr Cohen, Mr C and their mother were the subject of a common intention constructive trust pursuant to which they were all owners of the property in equal shares.
The purchasers acted consistently with the common intention constructive trust by making contributions described in the reasons for judgment to the property between 2000 and 2013.
In 2013 Mr Cohen brought the common intention constructed trust to an end by borrowing $100,000 against the property as security without the knowledge or permission of Mr C.
The mother has abandoned any interest in the property by her failure to participate in the proceeding or otherwise assert any interest in it.
As at the cessation of the common intention constructive trust Mr Cohen and Mr C were entitled in equity to one half share each of the value of the property.
THE COURT ORDERS THAT:
The parties obtain a retrospective valuation of the property as at February 2013.
Mr Cohen’s equitable share of the property be calculated according to the following formula – value of the property as at February 2013, less mortgage $130,000 divided by 2, minus $100,000.
Mr C pay the applicant 70 per cent of the sum so calculated and Mr Cohen 30 per cent of the sum so calculated within 30 days.
There be liberty to the applicant and first respondent to apply for orders for the sale of the property in the event of non-compliance with these orders.
IT IS NOTED that publication of this judgment under the pseudonym McCarrick & Cohen & Anor is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
FEDERAL CIRCUIT COURT |
DGC 1508 of 2017
| MS MCCARRICK |
Applicant
And
| MR COHEN |
First Respondent
| COMPANY A PTY LTD |
Second Respondent
REASONS FOR JUDGMENT
Introduction
This is the property component of a dispute between a de facto couple to which the de facto husband’s brother is, effectively, also a party. The second respondent, Company A Pty Ltd, is unquestionably a corporate alter ego of Mr C, who is the brother of the de facto husband, Mr Cohen.
The kernel of this dispute revolves around who owns how much of a property at Property B. The wife seeks that the property be divided some 60/40 per cent in her favour, as against the husband, and that a transfer of the property to Mr C be set aside pursuant to section 106B of the Family Law Act 1975 (“the Act”). The husband seeks the same order, save that he seeks that the property be divided in equal proportions between himself and the wife. The second respondent seeks that the application of the wife be dismissed and that there be an order for possession, as she is still in occupation of the property.
The proceeding has been rendered more difficult as a result of the self-representation of both the wife and the husband. They have not articulated legal arguments in a fashion that would assist the Court to determine some aspects of the controversy that are, in my view, clearly present. For the reasons that follow, I am going to declare that the property has at all times from 2001 until 5 February 2013 been the subject of a common intention constructive trust between Mr Cohen and Mr C, that their interest in the property be declared and enforced in the proportions of equal shares. I will further order that of the husband’s half-share in the property, there be an adjustment of some 70 per cent in favour of the wife.
Agreed or uncontested relevant facts
The wife was born on … 1976. The husband was born on … 1972, and Mr C was born on … 1978.
In 2000, the property was purchased for $186,000, and on 19 January 2001 Mr Cohen was registered as the proprietor of the property. It will be necessary to return to the contributions to the purchase price and the basis upon which the purchase proceeded in due course.
In about October 2004, the wife and husband commenced a relationship in the context that they were both working on employment duties. In approximately mid-2005, they commenced cohabitation together in Perth, Western Australia.
In 2008, they relocated to Queensland. Their first child, [X], was born shortly thereafter on … 2008. Their second child, [Y], was born on … 2011.
In 2012, the husband moved to Melbourne, and he took [Y] with him for a period of time, although it seems reasonably clear that the mother took her back to Queensland at some point before finally relocating to Melbourne herself on 30 October 2012. While [Y] was living with the father in Melbourne, she was looked after by the paternal grandmother.
In the interim, there was a transfer of the property executed by Mr Cohen in favour of Mr C on 4 May 2011. Although executed on 4 May 2011, this was never lodged. As already indicated in May 2012, the father relocated with [Y] and commenced training with the Employer.
On 10 September 2012 Mr Cohen transferred his interest in the property to the second respondent, Company A. The transfer was actually registered only on 27 November 2014.
Thereafter, from the time the wife came to Melbourne on 30 October 2012, the husband and wife lived in the property. The nature of contributions they may have made by way of work or payment will require further attention.
On 5 February 2013, the wife and husband borrowed $100,000, with the property as security. In 2015, the wife discovered that the property had been transferred to Company A and ended her relationship with the husband as a result.
The children of the relationship live with the mother and spend time with the father. A relocation application has been filed by the wife but not yet determined.
The parties’ affidavits
The wife’s first affidavit filed 18 May 2017 contains a number of matters already recited in the agreed material above. She deposed that during the initial stage of her relationship Mr Cohen had told her that he owned a house back in Melbourne next to his mother’s house. She deposed that he told her that his brother was going to inherit his mother’s house, and that his mother owned her own home. She deposed that it was, in fact, a Department of Housing house. She deposed to later becoming aware of the Certificate of Title showing Mr Cohen’s ownership. She deposed that at the time of the purchase of the property, the husband entered into a mortgage with the ANZ Bank in both his own and his brother Mr C’s names.
The wife deposed that in about mid-2005, when she commenced cohabitation in Perth, she discussed the property and asked whether they should be making mortgage payments in relation to it. In response, the husband advised her that there was no need to make mortgage payments, as there were university students renting the property, which covered the mortgage. She deposed that at the same time the husband had advised her that his brother was a co-borrower on the mortgage but only because they needed two incomes for the loan application, as the husband’s alone was not sufficient.
The wife deposed that as they were in Queensland, the husband had arranged for his mother to act as the property manager for the property. She deposed that this continued for sometime until early 2011 when there was a family disagreement and the mortgage payments were put on hold with interest-only payments being made for a period.
I should interpolate and say that much of this material is obviously objectionable as hearsay, but I recite it as it is essentially uncontroversial and it puts the narrative of the parties, and their resultant dispute, into context. If nothing else, the narrative is admissible to explain the wife’s understanding of events and here resultant position.
The wife deposed that in around April 2011, the husband told her that his brother, Mr C, wanted them to sign over the house to him. She said she disagreed. She suggested that they move to Melbourne and live in the house and pay the mortgage. The wife deposed that she had put several conditions upon relocating to Melbourne, including that he not sign the house over to his brother under any circumstances, that the husband and wife’s debts be amalgamated and the loan taken out using the house as security to do so, and the tenants be removed and the house refurbished. She deposed at paragraph 17, “I believed that when we moved back we were going to reside in the Property B property owned by Mr Cohen.” This did not, in fact, occur. She remained on the Region 1 for some time.
There was some disagreement in mid-2012 involving the way in which the wife considered the paternal grandmother to behave to her, but I note that at paragraph 25 the wife deposed, “During this time, I did not consider the relationship was over but admit this was a difficult period, and there were problems beginning to develop at this time.”
The wife sent a text message to the husband on 3 August 2012 which is largely irrelevant, but I note that there were several references in it to “my house”.
The wife deposed that on 31 August 2012 she and [X] flew to Melbourne and that there was a dispute with the paternal grandmother about the cleanliness of the house on 1 September 2012. She deposed to flying back to the Region 1 the following day with the two children. She deposed that while she was still in Queensland the husband and Mr C arranged the transfer of the title of the property to Company A, which is solely controlled by Mr C. She deposed that the transfer took place on 10 September 2012, with consideration expressed to be $650,000 but that no such amounts of money were ever paid, albeit that stamp duty of $34,070 was paid on the transfer on 17 September 2012. She noted that it was the paternal grandmother who witnessed the transfer. She deposed at paragraph 34:
“I state that I was completely unaware of the transfer of the property from Mr Cohen to Mr C for some time and the parties,
I believe, deliberately withheld this information from me as they knew that I would not have agreed to such a transfer or would have recognised the underlying reason for the transfer was to deprive me of the major asset in any property settlement with Mr Cohen should we split in the future.”
The wife went on to depose at paragraph 37 that in October 2012:
“I told Mr C that Mr Cohen and I would take over the mortgage and the costs of the property so he doesn’t need to worry about it. Mr C then stated, “No you will be renting off me.””
She deposed that she replied, “No, we will be paying the mortgage.”
The wife went on to depose at paragraph 40:
“The parties had previously discussed the idea of developing the property and building two townhouses. I spoke to Mr C about building a house each and Mr C asked me when I would be able to do this. My response to Mr C was that we would be ready once we had settled in, perhaps in a year or so. I then talked to Mr Cohen about the prospect of building two houses on the land and he assured me again that he had not signed it over and said, ‘Trust me’ which at the time I did.”
The wife deposed that it was pursuant to the understanding “we were all on the same page” she came to Melbourne on 30 October 2012 to live.
On 25 October 2012, the husband texted her asking her to transfer money so he could put it into a house payment, $500. She deposed to having already paid it.
She went on to depose at paragraph 45 that she spent $5,000 renovating the house to make it habitable and various other improvements.
She then deposed to the borrowing of $100,000 to which I have already made reference and that the loan was acquired to pay off accumulated debts, including the husband’s car loan.
The wife deposed that from the time she came from Queensland in October 2012 until November 2014, she paid an amount of $300 per week from her income to the mortgage account in a total sum of approximately $31,000. I note that at paragraph 49 the wife deposed:
“On or about 5 November 2012 I text Mr Cohen about the state of our relationship and said ‘I really feel you have checked out on this relationship’. Mr Cohen responded ‘Nobody checking out… I love you… and our kids’. At this stage I still considered we were in a relationship albeit that it was a little strained.”
The wife deposed to sending texts from time to time about the property, consistent with her appreciation of what was going on, and I note that on 16 July 2004 (paragraph 53), she texted Mr C along the lines of, Hi, just wanted to let you know we are going to salary sacrifice the mortgage, to which she received no response. Exhibit M-12 appears to support this assertion.
In or about October 2014, the wife texted Mr C again stating, relevantly, “We want to sit down with you and plan the building. Have you looked into it? Have you a builder or company in mind?”
On or about 14 October 2014, there was a text message with Mr C which canvassed talking about the building again, and Mr C responding, “Can do, but essentially we want to knock down and rebuild. Is there a lot more to it than that?” (Exhibit M-14).
On or about 27 November 2014, Company A was registered as the sole proprietor of the property, but the applicant wife did not know.
On or about 11 December 2014, the wife deposed the mortgage payments she was making to the mortgage accounts bounced back. She deposed that when she questioned Mr Cohen as to why this might be, he responded with words to the effect that Mr C changed the mortgage to a lower interest account because of his business. This would get a cheaper interest rate.
On or about November 2014, the wife texted Mr C chasing banking deals for the mortgage payments, to which she received no reply. A further such inquiry in January 2015 elicited an equivocal and evasive response.
The wife deposed that later she became aware that on 27 November 2014, the original mortgage between Mr C and Mr Cohen was closed, and a new one in Mr C’s name alone was created.
The wife deposed that in May 2015, the builder she had consulted with a view to constructing a home asked for a title search. This produced a title search on 11 May 2015 showing that the house had been transferred. Essentially, she deposed to the breakdown of the relationship thereafter as a result. She deposed that in August 2015 she sent Mr C a message saying she had a house, and exhibit M-30 is an exchange which relevantly shows her texting Mr C saying, “I emailed you the house quote. Can you get back to me ASAP with whether or not you want to go ahead with building,” which elicited a response, exhibit M-31 “How will this be funded, and by whom? Have you already approached a lender to see how much?”
She responded “You will find your half, I will find mine.” Relevantly, exhibit M-32 is a copy of a letter to third parties by the husband, presumably admissible as an admission against interest in which he asserted:
“I signed the house over to my brother, Ms McCarrick found out and is not impressed…
1. I signed it over telling my brother that when we came to Melbourne and were in a position to build then I would like him to sign it back to Ms McCarrick and I again. We would have 50% and he could have the other 50%. He agreed and was happy to do so.
2. Because I didn’t consult with Ms McCarrick she holds the view that I broke our trust and “can never forgive” me for lying to her hence our “separation”
Ms McCarrick’s stance is that she doesn’t believe my brother will sign it back which I have been telling her is not the case.”
The next affidavit was that of Mr C filed on 11 December 2017. He deposed that he was the sole director and shareholder of Company A and the younger brother of Mr Cohen. He studied at University and qualified in 2005 and was currently pursuing a training qualification from the Professional Association. Under the heading “History of The Matter”, Mr C deposed that his mother and he decided to buy the property in 2000. It is located next door to the family home. It was purchased by way of private sale for the sum of $186,000. Mr Cohen had returned from overseas and had obtained employment as a tradesman. Mr C deposed, paragraph 3, “As a consequence both he and I were mortgagors and my mother determined that his name would be placed on the title being the oldest son.”
He went on to depose that his mother contributed most of the equity. The mother paid one half of the deposit of about $10,000. Mr Cohen was not able to meet the prior agreement to pay half of the rest but produced about $3,000, and Mr C said he made up the shortfall of some $6,000. He deposed that for 12 months, renovations were carried out but that thereafter his mother started taking overseas students, and the income was generally sufficient to meet the obligations to the ANZ Bank for the mortgage. He deposed that when there were insufficient funds from the students to meet this need, he ensured that his funds were used to top up the loan and that this arrangement subsisted for over 10 years until 2011.
At paragraph 6, Mr C deposed:
“By 2011 I had become better established financially and I was making inquiries about borrowing money to buy another property. I was then advised by my proposed lender that I was not eligible for a loan because I had an indebtedness pursuant to the ANZ mortgage loan. I also became aware that another loan had been established using the property as security.
My enquiries revealed that Mr Cohen had taken out another loan of about $100,000 (“Mr Cohen’s debt”) and to do so used the property as security. He did this without my knowledge, consent or revealing his intentions to take out another loan with either me or my mother.”
Mr C went on to depose that his brother told him that the loans were used to consolidate the husband and wife’s debts and to buy a motor vehicle. He deposed that he and his mother were servicing the initial ANZ mortgage loan whilst Mr Cohen was serving the separate loan that he had established. He deposed that Mr Cohen was having financial difficulties in doing so. At paragraphs 7 and 8 he deposed:
“7. … He told me that he was having difficulty meeting his commitments pursuant to that loan and he came to my home and asked me to lend him about $15,000 to assist in helping him out of his further financial difficulty.
8. In or about late 2011 it was agreed that the property would be transferred into my name or an entity controlled by me. Ultimately it became apparent that I could not transfer the property without taking responsibility for the separate loan that had been established by Mr Cohen. At the time of the transfer which occurred in 2013 I established a new loan consolidating the ANZ mortgage loan in the sum of about $123,000 and Mr Cohen’s debt of about $90,000… I continue to meet the commitments pursuant to the consolidated loan.”
He annexed as C-001 a document dated 17 December 2013, purportedly signed by Mr Cohen and witnessed 19 April 2014, which reads, “This is to certify that the $214,000 is sufficient payout and that I have no further interest in the above property.”
It should be noted that in this affidavit filed 5 February 2018 (paragraph 42(g)) Mr Cohen admits signing this document and that “I agree that the $90,000 loan was extinguished by Mr C on behalf of Ms McCarrick and I.”
Mr C went on to depose that he was aware of the relationship between the husband and wife. He deposed that when he was in Queensland in 2011, he became aware of their financial difficulties and that when they arrived in Melbourne in 2012:
“10. … I agreed to permit Mr Cohen and Ms McCarrick to occupy the property in the belief that this would be a short term arrangement and on the basis that proper rental payments would be made. I recall that I had a telephone conversation with Ms McCarrick who confirmed that she wished to move into the property. I informed her that I expected rental payments to be made. Ms McCarrick specifically objected to this but said that she intended to make payments off “the mortgage”. Whilst I was confused by this I was happy for any payments to be made. However I made it clear to Mr Cohen that payments were to be made by way of rental. He agreed. At this time I was unaware that he had not told Ms McCarrick of the transfer of the property out of Mr Cohen’s name into the name of Company A. I do specifically recall telling Mr Cohen that he should inform Ms McCarrick of the transfer and I wrongly assumed that he had done this.
11. Mr Cohen and Ms McCarrick made payments of about $300 per week whereas I was paying a similar amount in order to meet the mortgage commitment which incorporated Mr Cohen and Ms McCarrick’s loan. I have always paid all outgoings including rates and taxes.”
He went on to depose that, following separation, rental ceased and that he had paid the mortgage on the property for the last three or so years. He sought an order for vacant possession.
The husband filed his first affidavit on 5 February 2018. Much of the material covers matters already traversed in the agreed matters above. I note that he deposed that following the birth of [X] in 2008, he stayed at home as the primary carer because the wife was able to obtain a health care job. Relevantly, for these purposes, however, he deposed to the purchase of the property. At paragraphs 17-18, he deposed:
“17. Prior to meeting Ms McCarrick, in about 2001, my brother Mr C, my mother and I agreed to work together to purchase the Property B property. At the time, my mother was living in a housing commission property at Suburb D.
18. The three of us discussed purchasing the property at Property B, to benefit all of us. My mother wanted to ensure that Mr C and I each had a property for the future. It is part of our Country 5 culture to work together to assist in the purchase of real estate for family members. As I was the eldest child, it was decided that the property would be bought in my name. The next property would be bought in Mr C’s name.”
The husband went on to depose that the purchase price was $186,000. He could not recall how much each of the parties had put in, but his mother, his brother and himself had provided the deposit. The mortgage was taken out in joint names of Mr C and Mr Cohen, and the property was rented to university students. Given that the grandmother lived next door, she took care of the management of the property. The husband deposed at paragraph 20:
“… During university vacation when the Property B property was vacant, I provided money to my mother to put towards
the mortgage to supplement the mortgage repayments. I believe my brother did this also.”
At paragraphs 23-27, the husband deposed:
“23. In around late 2010/early 2011 when Ms McCarrick and I were discussing moving to Melbourne, Mr C asked me to assign the Property B property to him. Although the title was in my sole name, Mr C and I had a joint ANZ bank loan. Mr C told me he was not able to explore purchasing any other property as he was locked into the current mortgage secured over the Property B property. I informed Mr C that Ms McCarrick, myself and the children were planning to move to Melbourne and that we intended to live in the Property B property.
24. As part of this conversation with Mr C, I suggested to him that we should sub-divide the Property B property, build a house for each of us and split the property equally between us. At the time, Mr C gave me confirmation this would be possible.
25. Subsequently, my mother also visited us in Queensland to see our newborn second child. She also encouraged me to transfer the Property B property into my brother’s name. I informed her that Ms McCarrick and I intended to move to Melbourne, and I also informed her of the discussion I had with Mr C in relation to sub-dividing, rebuilding and splitting the Property B property. My mother also agreed that this would be possible.
26. Following discussions with my mother and brother, I was feeling comfortable with the plan to transfer the Property B property to Mr C, and then work towards the sub-division and dividing of the property. I signed several documents regarding the transfer, however, I understand that they were not lodged until sometime later. I was not given any copies of the documents, nor did I make any copies of the documents as I trusted my mother and brother. I was certain that we would all be able to work together as a family to come to an agreement about building a new home on our return to Melbourne.
27. I did not initially inform Ms McCarrick of the discussions I had with my brother and mother. I also did not inform Ms McCarrick that I actually transferred my interest in the Property B property to Mr C. Ms McCarrick did not understand the Country 5 culture and arrangements such as these.”
The affidavit goes on to depose to the husband’s alleged work in renovating the property, the eventual transfer of the entire family to Melbourne, and his obtaining work for Employer and the wife as a health professional with Employer. He further deposed to the consolidation of his and the wife’s respective credit card debts by the borrowing of the $100,000 loan in February 2013. He deposed that he paid for the repayments in respect of that loan and that the wife repaid the existing mortgage. He deposed that he and the wife discussed their intention to subdivide and inspected homes accordingly. The wife having found such a design that she approved of, in due course, the builder sought the title and everything went wrong. He deposed that since separation the wife had remained in the property with the children, and he lives next door with his mother.
The husband filed a further affidavit on 27 March 2018. This was concerned with parenting issues.
The wife filed a further document on 28 October 2018. It takes the form of a letter to the Court. It complains of lack of discovery.
Mr C filed his trial affidavit on 13 November 2018. He deposed that Company A is the corporate Trustee of the … Family Trust of which he is the primary beneficiary. It largely repeats the matters in his first affidavit. I note that he deposed at paragraph 10 that, “Mr Cohen and I do not enjoy a good relationship.”
I note that at paragraph 11, he deposed, “My mother Ms E decided to purchase the property in 2000… I understand that the property was to be an investment.”
On this occasion, he put the contributions to the deposit slightly differently, asserting that his mother contributed $9,300, his brother $3,000, and he the balance of $6,300.
At paragraph 16, Mr C went into greater detail about the circumstances of the transfer of the property to him. He deposed:
“By 2011 I had become better established financially and I was making enquiries about borrowing to buy another property.
I was not eligible for a loan because I was already a borrower pursuant to the ANZ mortgage secured over the property and that I had no direct interest in the property because my brother was the sole proprietor. This culminated in discussions amongst myself, Ms E and Mr Cohen. It was agreed between us that the property would be transferred into my sole name and that
I would take sole responsibility for the mortgage encumbering the property. Now shown to me and marked with the letters “C-04” is a copy of the transfer of land signed by Mr Cohen and myself in May 2011. That transfer was never lodged as I was in the process of obtaining alternate finance and obtaining financial planning advice.”
Mr C went on to depose that he had insisted that the property be transferred to him because of another matter set out at paragraph 17 in his affidavit, which, essentially, amounts to alleged impecuniosity on Mr Cohen’s part at the time. He deposed that he had discussed in about 2000 (which I suspect is a typographical error meaning 2010) he had discussed with Mr Cohen about the future subdivision of the property. He deposed, “That was to be entirely at my discretion and as events have unfolded, particularly that I have been required to meet the applicant and Mr Cohen’s debt of $100,000 which was raised by the applicant and Mr Cohen. I did not wish to go ahead with any subdivision, as I did not then propose to make provision for Mr Cohen at all in the future.”
Mr C went on to depose to the circumstances in which the property was ultimately transferred to Company A. He obtained a valuation, noting that the valuation of the property as at 27 June 2011 was $650,000. He ultimately became aware of the $100,000 borrowed by the husband and wife in February 2013 and paid the same out in a consolidated loan. He went on to depose to the wife’s occupancy of the property. At paragraphs 29-30, he deposed:
“29. In October 2012 Mr Cohen informed me that he wanted the applicant to return to Melbourne to live with him in the property. I was unaware at this time that Mr Cohen apparently had chosen not to tell the applicant that he had transferred the property to the second respondent. I recall speaking with Mr Cohen about this and advising him that it would be reasonable to tell the applicant of the transfer. I became concerned when the applicant on assuming occupancy of the property appeared to claim an interest in the land by wanting to service the mortgage. I had made it clear to Mr Cohen and ultimately to the applicant that any payments she made to me was by way of rental. The applicant appeared to object to this and I spoke to Mr Cohen because I suspected he had informed the applicant of his agreement to transfer the property to the second respondent. I assumed that Mr Cohen would have informed the applicant and that in any event the $300 per week paid by the applicant and the first respondent was to my mind always rental income. I also considered that the rental arrangements would be a short term arrangement as Mr Cohen intended to re-establish himself by pursuing a career in the employment.
30. At no stage during the transfer was I intending to take advantage of my elder brother or his defacto partner. Mr Cohen had made little or no ongoing contribution to the upkeep or maintenance or financial requirements of the property and I ultimately registered the second respondent’s interest in the land in the knowledge that I would be responsible for the mortgage in its entirety including the $100,000 personal loan established by the applicant and Mr Cohen.”
The affidavit went on to assert the rent-free occupation of the premises since 2015. He disclaimed any improper conduct on his part.
The wife filed a further affidavit on 13 November 2018. This went only, however, to parenting issues.
The husband’s responding affidavit, likewise, is concerned solely with parenting issues.
It will be noted that although the affidavits make it clear that the grandmother is still living in Property B, neither of Mr Cohen or Mr C have put her on affidavit or caused her to be subpoenaed to give evidence. I infer, pursuant to Jones v Dunkel, that her evidence would not have been likely to have assisted either party.
The submissions made and the evidence given at Court
What follows is taken from my notes. Self-evidently, it is not a transcript that records those aspects of the evidence that I saw significant.
The mother in opening confirmed that she seeks a 60/40 split of the net value of the property. She adopted her affidavits as true and correct.
The husband elected to put no questions to the wife.
Under cross-examination by counsel for the second respondent, about the chronology prepared by the second respondent, the wife confirmed that she had seen it but did not agree with it. She did not agree it was true and correct. She was taken through it in somewhat laborious detail. It emerged that much of it was, in fact, the subject of only minor disagreement, although there were other significant ones.
When it was put to her that exhibit M-14, a text exchange in October 2014 onwards, was the only text sent by Mr C about building, the wife said that they had talked about it before they went to Melbourne. She said there were numerous texts and emails over time about building. This was what Mr C had said would happen. She denied that she had only lived in the property for 12 months. They moved in in October 2012. Her relationship with the husband broke down when she found out in May 2015 that Mr Cohen had given the house to his brother. Mr Cohen left the property in September 2015.
The wife said that she did not cease her mortgage account payments. She had direct debit, but it bounced back in December 2014. She kept asking Mr C and Mr Cohen for the new account details because she wanted to keep paying. Mr Cohen said, “He’s changed the account and will get back to you.” She had lived rent-free since November 2015 because she was not allowed to pay the mortgage. She stayed in the premises. She had seen the husband’s job application in March 2015. He had not put his ownership of the property on the application and she asked him. He said he had forgotten to put it down.
She accepted that the $650,000 had not been paid on either transfer. She had been to the bank with Mr Cohen. The security for her loan was the house. Mr Cohen did not mention the transfer to her. When it was put to her that they had borrowed $100,000 in 2013 because of financial difficulties, the wife said these were not financial difficulties. They had been in Queensland and had very two young children and a lot of debts. Both were working. She was working part-time. The debt was $100,000 altogether, including the husband’s car. She was part-time working three to four days a week at the time of the loan. She was to pay the mortgage and Mr Cohen was to service the debt of $100,000.
Both of them lived in the house when they moved to Melbourne. The husband had been there with the younger child before this. The child was only one year old at the time. This was only a short period of three months. She took the children back to the Region 1 in September 2012. She has not worked full-time for the last four years. She works part-time in two positions. She works three to four days. She has worked three days a week reduced to six hours, and then has subsequently worked four days a week. She works for Employer at four days per week, and has done so for about three years. She was undertaking … work until about a year ago. She now has work as a health professional.
Between October 2012 and January 2013, she was waiting for her job with Employer to come through. She had obtained a balance of her outstanding leave from Employer and this paid the mortgage and food. She has looked after the house, but has not paid rent or rates after 2014. She paid the utilities. She paid the full water bill till she found out she did not have to. She agreed that the house was land value only. She spent money making the property liveable at the start. They both agreed that they would build and Mr C agreed too. Mr Cohen and she had discussed building in 2011. She had not owned property before.
She had met the husband in about October 2004 and they started living together on board. Then they moved to Perth. She was not quite sure when this was. They moved to Queensland in February 2008. She had worked, but not full-time, in Perth, and the husband worked. She was not sure if it was full-time. All the debts in Perth were the husband’s and not hers. It was mainly a car loan and credit cards.
The wife disagreed that she had no capacity to contribute to the property. When the children were born, there were no extra funds available for the property, but rent was paying the mortgage. They knew that she could pay the mortgage of $300 per week and Mr Cohen would pay off the loan. Payments continued till November 2014 at $31,000. She never told Mr C about the $100,000 loan. Mr C did not assist with the loan. She disagreed that Mr C had not responded agreeing with her about building. He sent the message in May 2015 asking how it would be funded. She conceded that there was an error in her affidavit referring to exhibit M-6 and said that that was
a conversation with Mr C before that. Her explanations about M-13 seem to me to be somewhat confused.
The Evidence of Mr Cohen, the Husband
The husband adopted his affidavit as true and correct. Under cross-examination by counsel for the second respondent, he confirmed that he is a professional and has been at Suburb F for two and a half years. He started his training in 2012 as a professional, but has converted to being a professional. He and the wife met in 2004 and in about 2005 returned to Perth for some two and a half to three years. Then the first child was born and they wished to move to Queensland. They had debts in Perth, including a car that he had bought and general household items. When they moved to Queensland, he had worked in three to four different casual jobs, but the wife got full-time work with Employer. He was a stay-at-home father the whole time in Queensland, but did some casual work also. They decided to borrow $100,000 to pay out debts.
The husband confirmed that he had read Mr C’s trial affidavit. There were no receipts. Everything was done in cash. He conceded that annexure C-O4, the transfer, had his signature as did annexure
C-O5, the transfer ultimately lodged. He had not told the wife that he had transferred, and did not tell the bank of them when he applied for the $100,000 loan. He was not unemployed at the time, and could not recall telling Mr C the matters asserted in paragraph 17 of Mr C’s affidavit. He conceded that his grandmother is in Country 5 and is 100 years old.
From the time of the purchase of the property in 2000, he was in and out of the country. He provided a financial report for the property from time to time. He gave his mother money, but did not know what she did with it. He asked rhetorically why he would make payments to the second respondent. The property was sometimes occupied by students. He was not party to these arrangements. The bank never asked about the transfer when they applied for the loan. He had moved to Melbourne for a few months with the younger child. He did not pay anything to the mortgage. He contributed to the upkeep of the house.
Under cross-examination by the wife, the husband confirmed that his income is $1,270 a week with tax of $466. This is from his payslips. He had not disposed of any property before or after separation. He conceded the transfer of land disposed of property. He said that he understood Mr C was only holding the property for a short time. There was discussion between Mr C, himself and his mother.
The plan was that his transfer was on condition that when they came
to Melbourne, they would subdivide and build as a family. He was not trying to hide assets. There was no instability in the relationship at the time.
The move to Queensland was raised when the wife was pregnant. There were doing okay in Western Australia. He did not want to tell his mother about the pregnancy because they were not married. His mother is a devout Catholic. He went to Melbourne for the day to tell his mother and they were not engaged at the time. He said he had proposed, but the wife declined. He did not consider the relationship to be unsteady. He had not paid capital gains tax and was not aware of any capital gains tax liability over $100,000. The original intention was that they would have the property each.
When questioned as to when he had stopped paying the second loan, he said he did not recall specifically, but it was when the transfer of property took place. There was direct debit of his account to pay the loan till then. Exhibit A1 was tendered as being bank records. This shows a “home loan” in the names of the wife and husband with loan payments until 10 December 2015, when the loan closed. He said there were issues with the transfer and that was why they are in Court today. He has no training in financial abuse and had not financially abused the wife.
The Evidence of Mr C
Mr Cohen is a health professional and he adopted his trial affidavit. He corrected an error in paragraph 17(d) which is not significant. The balance of the mortgage is now $196,601 and includes the original loan and his brother’s loan. $123,000 was the residual mortgage on the property when it was transferred, and he added $88,000 being the remainder of his brother’s debt to produce a total of $219,000.
Under cross-examination by the husband, Mr Cohen said that he had contributed to the costs of the property with a combination of part-time work, including working at a local … employment. He did more such work in the school holidays. He stuck to his version of the original agreement as to contributions to the deposit. There was no documentation to support what he asserted. When questioned about paragraph 13 of his affidavit about the original renovations, he said he had tried to get ANZ records, but they did not go back that far. He said he had met the minimum payment during the university break. This was predominantly through electronic transfer in the sum of between three to $400 per week. He maintained that he had undertaken general maintenance at the property. He agreed that his brother had undertaken some maintenance, but had not put money to the mortgage itself. He was not aware if Mr Cohen had given his mother money.
When cross-examined about paragraph 16 of his trial affidavit, he said that the discussions about the transfer of the property took place over about a week. He could not recall discussion about Ms McCarrick and Mr Cohen coming to Melbourne. He said there was an idea in discussions of possible subdivisions, but he said this did not advance. I should say that these latter answers were given in a particularly evasive way.
He recalled the husband’s request for assistance as to debt. He thought he was being asked to help him. He said his brother said he could not pay the mortgage while paying rent in the Region 1. Mr C said he felt he had been approached for financial help and thought he would help him out by taking out the mortgage. The witness to exhibit CO4 was his partner at the time. He said that Mr Cohen had come to where he was living in the Region 1.
Under cross-examination by the wife, Mr C confirmed that the family trust was set up at the same time as Company A. There are no other properties owned in the trust. His mother is a beneficiary of the trust. There are no incomes or outgoings in the trust. He was a guarantor of the original loan. His mother was not on title. He did as his mother asked. His contribution was part of the common intention, “Part of what mum said they should do.” The idea was floated that he would get the mother’s home after the Country 5 inheritance was received and Mr Cohen would get the other property. Mr Cohen would get the other property, but this did not happen. He is not seeking to hide assets.
There was no discussion of problems in the relationship. When he was pressed by the wife, who said she begged him to let Mr Cohen tell his mother about her pregnancy, he said he did not recall. He said he had paid Mr Cohen’s legal fees because he had asked for help, but denied he ceased it when Mr Cohen was unhelpful. He said he had tried to help his brother as much as possible. He said fees went up and he could not afford all of them. He said a caveat had been lodged, but it lapsed following legal proceedings. He said he had paid the mortgage since 2011. He did not recall any discussion of Capital Gains Tax.
By leave, I permitted Mr Cohen to put a further question. He put it, with evident and vivid emotion that he had signed over the property provided that when they came to Melbourne they would talk about subdivision as a family. Mr C replied, “Definitely not.”
Final Submissions - Counsel for the Second Respondent
I do not propose to traverse counsel’s submissions in any detail, helpful albeit as they were. That is because, essentially, they put the husband’s case as it is outlined in his materials. I note in particular the submission that section 106B of the Act cannot apply because there was no proceeding on foot when the transfer took place. I note the primary position that the property is simply not part of the property pool. In the alternative, it is put that the second respondent would seek to be heard as to the form of orders to be made. Counsel also submitted, correctly, that questions from the bar table are not evidence.
The final submissions by the wife were made with evident emotion. They do not, however, take the matter much further. Her complaints about discovery, while genuine, do not, in my view, take the matter further.
The husband’s final submissions likewise, it is not necessary to traverse in detail. I note his observation that there was no legal obligation on him to sign the transfer of land in any event.
Findings about the Disputed Facts
In my view, taking the evidence as a whole, it is clear beyond doubt that in or about 2000, the Cohen family, consisting of Mr Cohen and Mr C and their mother, agreed to buy the next door property to the one in which they were then living. Mr Cohen, of course, was often overseas on his work, but this was, to all effects, his residence too.
From the affidavit material filed by both parties, it is clear that the mother was the directing mind of the initiative. She put up the bulk of the funds. It would seem that at the time, the younger brother, Mr C, had slightly more cash available to contribute, but the insignificance of this in the scheme of things is well illustrated by the fact that the property was put in the older brother’s name. I accept that this was simply a reflection of Country 5 cultural values. Mr Cohen was, on any view of the matter, trustee for his mother and his brother at that time.
Thereafter, it is possible that a certain amount of time was spent renovating the property, although the evidence as to who did the renovations, who paid for them and the like is extremely nebulous. What is clear, however, is that once that process was completed, however long it may have taken, the property was rented out to university students. This rental covered the vast bulk of the ongoing mortgage payments. Shortfall was, as I find, paid off by a combination of contributions by each of the two brothers, Mr C and Mr Cohen. There is simply no means of saying how much this amounted to as the evidence by both brothers was vague and unconvincing. Nonetheless, I accept that both of them contributed from time to time as they were able.
It is noteworthy that both brothers appear to me to agree that the person who actually managed the property, so to speak, was their mother. She got the money from the tenants and no doubt requited it towards the mortgage and attended to the payments of necessary outgoings. Whether any land tax was ever paid remains wholly unclear.
There matters stood until about 2011 by which time the mortgage had been, in fact, quite substantially reduced. When it was ultimately paid out, it amounted to some $130,000 in 2013.
In the meantime, the wife and the husband had commenced their relationship. They lived in Perth for some years during which they incurred significant debts, including a motor car loan, amounting, it would seem, to some $100,000. They moved to the Queensland, Region 1, in about 2008 pending the arrival of their first child. It would seem that Mr C also lived in Queensland for at least some of the time.
Thereafter, the husband moved to Melbourne. He took the second child with him, at least initially, although the wife took her back to Queensland following an argument with the grandmother in 2012.
The first transfer was executed on 4 May 2011. It was never lodged. Mr Cohen did not tell the wife about this transfer. The inference is obvious. He was scared of what would happen if he did.
It is the evidence of Mr C that by 2011 he had become better established financially and was considering buying another property. Since he and his brother were joint mortgagors of the property, he faced an obviously difficulty in getting further loans. He needed the property to be transferred into his sole name to enable further loans to occur.
Having heard and seen both of the brothers in the witness box, I have no doubt that the transfer took place at the request of Mr C so that he could clear the decks, so to speak, for further financial investment. No other explanation makes sense.
It should be noted that it is the wife’s own evidence that up to 2012, whatever difficulties there were in the relationship, she continued it to be ongoing. So too, from the materials filed, did the husband.
One thing that is apparent, however, is that there was no obligation, as Mr Cohen correctly asserts, on Mr Cohen to transfer the property to his brother.
The first transfer was never registered. It was overtaken by events. In September 2012, Mr C prevailed upon his brother effectively to transfer the property to him again. The consideration for this was, of course, the removal of the joint debt on the mortgage, then down to approximately $130,000, and the remainder of the husband and wife’s loan, down some $88,000-odd. Both transfers were obviously shams inasmuch as the consideration purported to be paid of some $650,000, then value of the property, was simply not paid, albeit that stamp duty appears to have been paid on the $650,000 figure.
Thereafter the borrowing of $100,000 by the husband and wife took place with the property as security in February 2013. Mr Cohen did not tell his brother about the borrowing. Once again, the inference is obvious. He was scared of the consequences. He had dishonestly not told the wife of the earlier transfer of the property to his brother. Likewise, he knew because of the transfer, he had no legal interest in the property.
Running parallel with these developments, the wife had moved down to Melbourne in circumstances where, she said, she was convinced to move by the opportunity to live in the property and take over the mortgage as she saw it. There is a dispute as to whether or not the wife made this matter of the mortgage properly known to Mr C. She plainly mentioned it. I think there was a strong element of reconstruction in both of the two witnesses’ versions of the events. On the one hand, it is clear that the wife told Mr C that what she was paying was what she regarded as the mortgage. It is clear that the wife had discussed with Mr Cohen that she would pay the mortgage and he would pay their outstanding $100,000 loan. The amounts paid of $300 per week or in excess of $15,000 per year, plus utilities and the like, which were plainly paid by the husband and wife from 2012 until December 2014, clearly well exceeded any interest and principal payable to a standard mortgage on what was then somewhere in the $130,000 - $150,000 range, I would infer.
As I find, Mr C knew that the wife thought she was purchasing an interest in the property and dissembled. His evidence as to his recall about these aspects of the matter was unconvincing.
Nonetheless, the wife’s version of events has at all times, in my view, sprung from a basic and fatal misconception. Accepting that she knew the property was in her husband’s name, she must have known that she herself had made no contribution whatever to the property until she started paying the $300 per week in 2012. The notion that she had
at all times a proprietal interest in the property is plainly misconceived as she well knew it was registered in the husband’s name. There is a strong element of make belief in the wife’s reconstruction of events.
In my opinion, the second transfer was effected for two inter-related reasons. The origin of the application of Mr C to transfer the property to his name was his desire to be able to borrow more funds for further property investment, given that he was impeded in doing so by his existing role as a mortgagor of the property. This suited his brother who, in the ultimate, obtained relief from his contribution to the mortgage and the personal loan that he and the wife had taken out without Mr C’s knowledge. This, however, was not all that was in his mind.
As chance had it, Mr C achieved 100 per cent ownership of a property worth $650,000 for an outlay of $219,000. His previous half interest was worth $325,000 less his approximate $65,000 share of the mortgage i.e. $260,000. Now he has $430,000. This is good business on any view. This was not, in any conceivable sense, generous to his brother but, rather, took advantage of him. It was plainly in breach of the common intention of the parties when the property was bought and pursuant to which they had acted, as I find, consistently until 2012 at least. It was more probably than otherwise also at the back of at least Mr Cohen’s mind that this would protect his position in the event that things went bad with the wife. It was not, however, the major reason for the transfer.
When people act dishonestly, as both Mr C and Mr Cohen did, and in respect of Mr Cohen, he was dishonest both to his brother by mortgaging the property and to the wife by not telling her about his transfers, it becomes very difficult to construe events later on. This is especially so since all concerned have a strong and natural tendency to reconstruct events favourably to the position for which they now contend.
In the ultimate, my conclusions can be expressed relatively shortly. The Cohen family entered into arrangements to purchase this property as an investment in 2000. This clearly, in the circumstances, gave rise to a common intention constructive trust which bound all of them. They acted entirely consistently with it through until at least September 2012, when the second transfer was signed. One can only infer from the march of events that the mother has abandoned her interests in the trust to her sons in some fashion, not presently revealed. Plainly, she has asserted no interest and has not participated in the proceedings.
How does this leave then the position between the two brothers? As I find, Mr Cohen held the property on trust for his brother while he was the registered owner of it. In my opinion, he only allowed his brother to become the registered owner on the footing that he retained his share in the property. As he rightly says, he was under no obligation to transfer it and I give him full credit for having the sufficient appreciation of his interests, not to have given away a half-share in a $650,000 property for relief from a joint debt of $130,000 (the registered mortgage) and a personal debt of $88,000.
There had plainly been sufficient discussion of subdivision of the property and building upon it to act as a sufficient incentive to make Mr Cohen act so obviously to his detriment. The dissimulating responses that both brothers gave to the wife about the mortgage payments when they ceased in November 2014 and when she raised the matter specifically with Mr C, only go, in my opinion, to reinforce the fact that although they had subsequently fallen out, the brothers saw the transfer to Mr C as a holding pattern only.
What remains unclear is when Mr C took over Mr Cohen’s half share of the mortgage and Mr Cohen and the wife’s loan, although obviously it must have been after the loan in February 2013. In his affidavit filed 11 December 2017 Mr C deposed that this occurred “at the time of the transfer in 2013”. He annexed C-001 which was signed on 17 December 2013 by Mr Cohen (wrongly described at 17 December 2012 in the affidavit itself).
The transfer itself was not registered until 27 November 2014 and exhibit A1 shows that the loan of Mr Cohen and the wife was not finally extinguished until December 2015.
It is difficult to work out what really happened, but by no later than December 2013 Mr Cohen had ceased all payments. The payments in exhibit A1 must have somehow, been paid by Mr C. I find that the delay in the finalisation of the second transfer, and the extinguishing of the account exhibit A1 was simply the time it took Mr C, (who appears to have been undertaking health professional training) to order his affairs.
As the Full Federal Court recently observed in Sylvia (Trustee) v Williams [2018] FCAFC 194 at [13]-[16]:
“[13] It is well-settled that there are circumstances in which a court of equity will intervene to declare the existence of a proprietary interest in a family home on the part of a spouse or de facto partner. This will occur when, in the circumstances of the case and in accordance with equitable doctrine, it would be unconscionable on the part of the person against whom the claim is brought, to refuse to recognise the existence of the equitable interest: Baumgartner v Baumgartner [1987] HCA 59; 164 CLR 137 at 147 per Mason CJ, Wilson and Deane JJ (‘Baumgartner’).
[14] The categories of case in which this may occur are not closed but one common example is where a spouse or partner makes a financial contribution towards the cost of acquiring, improving or maintaining a property held in the other’s name. In such cases, it is accepted that the party asserting the existence of the trust must prove, first, that the spouses held a common intention that they would own the property together; and, secondly, that the party asserting the trust acted upon that common intention by making contributions or other action to their detriment: Green v Green (1989) 17 NSWLR 343 (‘Green v Green’) at 354–355 per Gleeson CJ (Priestly JA agreeing at 371). The contributions to the matrimonial home may be both direct or indirect (Gissing v Gissing [1971] AC 886 (‘Gissing v Gissing’) at 908; Green v Green at 354) and may include not only the costs of acquisition, but also the costs of any improvements or costs relating to maintenance (Green v Green at 353). That said, the mere fact of the relationship combined with express or implied undertakings to provide support and accommodation will not suffice to establish the trust.
[15] In cases involving actual contributions by one spouse this will often make it relatively straightforward to establish detriment which may consist of the fact of the contribution itself. Once the trust is established the interest arising under it will be to the extent that the couple are inferred to have intended: Gissing v Gissingat 908. When joint ownership can be inferred to have been intended this may suggest equal beneficial interests: Eves v Eves [1975] 1 WLR 1338 at 1345 per Brightman J. On the other hand, where contributions have been made they may be of importance to resolution of the question too: Green v Green at 355. There is, however, no definitive answer to this question which is essentially a factual one.
[16] As to the proof of the common intention, this too is a question of fact and may be proved in the various ways that the facts about states of mind may generally be proved. Such proof may be direct by means of express agreement but it may also be implied from conduct. Matters of this kind are evidentiary and do not involve legal principles:”
While, of course, that judgment was concerned with marital relationships, these remarks are equally applicable to conduct between intimate family members such as the Cohen family, (see Baumgartner v Baumgartner (1987) 164 CLR 137 at [148] per Mason CJ, Wilson and Deane JJ.
In this case, there is no question that there was a common intention of the sort described. Both brothers have, in my opinion, said so in their affidavit material and it is clear that that is what they had in mind. There is equally no question that for the vast bulk of the time the property was held, both of the two brothers made contributions from time to time. There is nothing to suggest either parties’ contribution was any greater than that of the other.
The matter thus stood effectively until 2013. The only new matters that entered upon the scene were the brother Mr Cohen and the wife borrowing $100,000 without telling Mr C, and the relatively minor payments made by the wife to the property, assuming them to have been mortgage intended, from late October 2012 onwards.
In my opinion, the action of Mr Cohen in borrowing $100,000 against the property in February 2013, together with a third party not a party to the constructive trust, without informing his brother, must be construed as bringing the common intention constructive trust to an end. From that point onwards, he did not have the clean hands that equity requires for him to obtain equitable relief against his brother, and that in substance is what he seeks. Further, the common intention to own, and possibly develop, the property was necessarily defeated by the further encumbrance of the property of a $100,000 unauthorised debt.
In these circumstances, I assess the brothers’ ownership of the property as at the time of the cessation of the common intention trust in February 2013 to have been effectively equal. The main bulk of contributions were not made by either of them but by the rental from students, and it was the mother who did all the work associated with that income. The husband had, in a sense through the wife, contributed to payments towards the property from October 2012 until February 2013, but he was in occupation with her at the time.
The wife contributed to the mortgage significantly between late 2012 and late 2014. This was plainly to the benefit of Mr C. He, however, was also paying larger sums off the larger debt that he had consolidated, and since late 2014 until now the wife, and for a time the husband, had occupation of the property at no cost at all.
Doing the best I can to do justice and equity in what are, as a result of the way the parties have conducted themselves, very murky circumstances, I think that Mr Cohen should be declared to be entitled pursuant to a common intention constructive trust to half of the net value of the property as at February 2013. From that sum should be the amount he borrowed against it.
Neither Mr Cohen nor the wife are entitled to any of the accruals of value that have obtained since 2013. In my view, the wife’s contributions to the mortgage from 2012 to 2014 are wholly offset by her rent-free accommodation of the property since then. This puts to one side the otherwise potentially difficult issue of working out from this complicated factual position what particular legal or equitable doctrine would give rise to any benefit to her in any event.
Having made these findings, it is relatively straightforward to move to the rest of the property dispute.
Stanford v Stanford
Both sides agree that there should be a property division and it is plainly just and equitable there should be one.
The Pool
The pool consists the husband’s interest in the equity of the property, as I have found it to be.
There is no meaningful suggestion that there are any other assets of the parties’ to divide.
The wife has superannuation according to her Financial Statement of some $90,000 (this figure would be over a year out of date) and the husband has some $59,000. Neither party has sought a superannuation split and in view of the future need components of the parties, bearing in mind that the wife is marginally older in any event, it is plainly inappropriate that there be such an adjustment.
Contributions
Both of these parties, in my view, clearly did their best in terms of child rearing and earning and general support throughout the currency of the relationship from 2004 until 2015. It is appropriate to assess their contributions as equal.
Section 75(2) Factors
Here it is common cause that the wife has and will have the primary care of the children on an ongoing basis for many years to come. She plainly will struggle at least for some years to obtain full-time employment, whereas the husband is now fully employed. The incomes of the parties are much the same, but I note that the husband’s would appear to perhaps have greater potential for promotion over time. Neither party has deposed to any particular health difficulties. The husband has the benefit of living with his mother.
In all the circumstances, in my opinion, the wife should have a 20 per cent loading in relation to future needs matters.
Conclusion
This has been a tortuous case made difficult both by the legal complexities of the matter and also by the dishonesty and underhand conduct of the two Cohen brothers. The conclusion I have reached does my best to produce a just and equitable outcome, notwithstanding these forensic obstacles. I have drawn draft declarations and orders to give effect to these conclusions.
I certify that the preceding one hundred and thirty-three (133) paragraphs are a true copy of the reasons for judgment of Judge Burchardt
Date: 23 January 2019
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