McDonald v Stelzer

[2000] NSWCA 302

Reported Decision: [2000] 27 Fam LR 304

New South Wales

Court of Appeal

CITATION:	McDONALD v STELZER [2000] NSWCA 302 revised - 7/11/2000
FILE NUMBER(S):	CA 40505/99
HEARING DATE(S):	12 October 2000
JUDGMENT DATE:	3 November 2000
PARTIES :	Douglas McDonald - Appellant Christine Stelzer - Respondent
JUDGMENT OF:	Priestley JA at 34; Handley JA at 41; Sheller JA at 1

LOWER COURT JURISDICTION :	Supreme Court - Equity Division
LOWER COURT FILE NUMBER(S) :	3083/97
LOWER COURT JUDICIAL OFFICER :	Bergin J

COUNSEL:	M D Broun QC/A G Todd - Appellant C A Needham SC/V M Heath - Respondent
SOLICITORS:	Needs Chan & Monahan - Appellant Miles Clinton - Respondent
CATCHWORDS:	FAMILY LAW - de facto relationships - De Facto Relationships Act 1984, ss 17 and 20 - where relationship existed for less than two years - adjustment of property interests - contributions - contribution prior to commencement of relationship NR
LEGISLATION CITED:	De Facto Relationships Act 1984 Family Law Act 1975 (Cth)
CASES CITED:	Dwyer v Kaljo (1987) 11 FamLR 785 Evans v Marmont (1997) 42 NSWLR 70 Griffiths v Brodigan (1995) 20 FamLR 822 In the marriage of Olliver (1978) 32 FLR 129 Roy v Sturgeon (1986) 11 NSWLR 454 Wilcock v Sain (1986) 11 FamLR 302 R v Hunt (1979) 25 ALR 497
DECISION:	Appeal dismissed with costs.

THE SUPREME COURT

OF NEW SOUTH WALES
COURT OF APPEAL

CA 40505/99
ED 3083/97

PRIESTLEY JA
HANDLEY JA
SHELLER JA

McDONALD v STELZER

The appellant and the respondent were involved in a de facto relationship between April 1994 and January 1996. From January 1995, the parties lived in the appellant’s home. Until 1994 the respondent owned and occupied her own home which she sold in late 1994 in order to join in the development of a property bought by the parties in June that year. This property was developed and subdivided into two houses one of which (117 Holt Road) was transferred into the respondent’s name and the other (117A Holt Road) sold. The trial Judge declared that the respondent should have 117 Holt Road as her own and, together with other adjustments of the proceeds of sale of 117A Holt Road, the respondent received a share of 41.63% of the parties’ property, leaving 58.73% to the appellant who appealed from the decision.

Held (by Sheller JA, Priestley and Handley JJA agreeing):
1. It is not correct to assume, as the appellant submitted, that the financial contributions should be treated as returnable to the contributor and that, given the relatively short period of the relationship, the non-financial contributions should be treated as equal so that the remaining balance would be divided equally.
2. The respondent sold her home to join in the development venture which could not have gone forward without her contribution. The appellant was able to progress the construction work because the respondent used her salary to pay for household expenses. Having made such substantial contributions, the respondent would not, in all the circumstances, be adequately compensated if she were left without her own home and it could not be shown that the trial Judge’s orders were not appropriate.

Evans v Marmont (1997) 42 NSWLR 70, applied; Dwyer v Kaljo (1987) 11 FamLR 785, applied.
3. The most significant contributions by the parties were made after the relationship began. It is difficult to ascertain from the trial Judge’s judgment the extent to which her Honour took into account contributions made prior to the commencement of the relationship and no error could be demonstrated.

Roy v Sturgeon (1986) 11 NSWLR 454, referred to; Griffiths v Brodigan (1995) 20 FamLR 822, referred to.

4. The trial Judge was entitled to take into account circumstances of or related to the parties’ relationship which occurred prior to the commencement of the relationship, provided such circumstances were closely connected in subject matter, time and relevance to the financial and non-financial contributions made during the period of the relationship. Such matters could be given some but not fundamental weight (by Priestley JA).

Evans v Marmont (1997) 42 NSWLR 70, applied; Dwyer v Kaljo (1987) 11 FamLR 785, applied; Wilcock v Sain (1986) 11 FamLR 302, referred to; R v Hunt (1979) 25 ALR 497, referred to.

Legislation:
De Facto Relationships Act 1984
Family Law Act 1975 (Cth)

Cases cited:
Dwyer v Kaljo (1987) 11 FamLR 785
Evans v Marmont (1997) 42 NSWLR 70
Griffiths v Brodigan (1995) 20 FamLR 822
In the marriage of Olliver (1978) 32 FLR 129
Roy v Sturgeon (1986) 11 NSWLR 454
R v Hunt (1979) 25 ALR 497
Wilcock v Sain (1986) 11 FamLR 302

ORDERS

Appeal dismissed with costs.

*****

THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40505/99
ED 3083/97

PRIESTLEY JA
HANDLEY JA
SHELLER JA

Friday, 3 November 2000

McDONALD v STELZER

JUDGMENT

SHELLER JA:
INTRODUCTION

1 On 3 July 1997 Christine Stelzer, to whom I shall refer as the respondent, brought proceedings in the Equity Division of the Court against Douglas McDonald, to whom I shall refer as the appellant, for a declaration pursuant to s56 of the De Facto Relationships Act 1984 (“the Act”) that a de facto relationship existed between the respondent and the appellant from 11 August 1989 to 2 January 1996 and for orders under Pt 3 of the Act adjusting the interests with respect to the property of the de facto partners pursuant to s20 of the Act.

2 Bergin J heard the proceedings between 2 and 7 June 1999 and delivered judgment on 8 June 1999 after reserving overnight. Her Honour found that a de facto relationship existed between the respondent and the appellant from about April 1994 and ceased in January 1996. The trial Judge noted the appellant’s concession that such a relationship existed between January 1995 and January 1996. Since the relationship had existed for less than 2 years, Bergin J could only make orders as provided by s17(2) of the Act, which is what her Honour did.

STATUTORY ENTITLEMENTS

3 Section 17 in Pt 3 of the Act provides

“Prerequisites for making of order - length of relationship etc
(1) Except as provided by subsection (2), a court shall not make an order under this Part unless it is satisfied that the parties to the application have lived together in a de facto relationship for a period of not less than 2 years.
(2) A court may make an order under this Part where it is satisfied:
(a) that there is a child of the parties to the application, or
(b) that the applicant:
(i) has made substantial contributions of the kind referred to in section 20(1)(a) or (b) for which the applicant would otherwise not be adequately compensated if the order were not made, or
(ii) has the care and control of a child of the respondent,
and that the failure to make the order would result in serious injustice to the applicant.”

4    There was no child of the respondent and appellant. The respondent had a daughter, Bree, by her earlier marriage to Frank Stelzer. The appellant had no children.

5 Section 20 of the Act provides:

“Application for adjustment
(1) On an application by a de facto partner for an order under this Part to adjust interests with respect to the property of the de facto partners or either of them, a court may make such order adjusting the interests of the partners in the property as to it seems just and equitable having regard to:
(a) the financial and non-financial contributions made directly or indirectly by or on behalf of the de facto partners to the acquisition, conservation or improvement of any of the property of the partners or either of them or to the financial resources of the partners or either of them, and
(b) the contributions, including any contributions made in the capacity of homemaker or parent, made by either of the de facto partners to the welfare of the other de facto partner or to the welfare of the family constituted by the partners and one or more of the following, namely:
(i) a child of the partners,
(ii) a child accepted by the partners or either of them into the household of the partners, whether or not the child is a child of either of the partners.
(2) A court may make an order under subsection (1) in respect of property whether or not it has declared the title or rights of a de facto partner in respect of the property.”

6 Section 3(1) of the Act defines de facto partner to mean:

“(a) in relation to a man, a woman who is living or has lived with a man as his wife on a bona fide domestic basis although not married to him, and
(b) in relation to a woman, a man who is living or has lived with the woman as her husband on a bona fide domestic basis although not married to her.”

and de facto relationship to mean:

“the relationship between de facto partners, being the relationship of living or having lived together as husband and wife on a bona fide domestic basis although not married to each other”.
PROPERTY OF THE PARTIES

7    In June 1999, when the proceedings were heard, the property of the respondent and of the appellant comprised:

(a) 155 Holt Road, Taren Point

The appellant purchased this house in 1980. On 14 January 1995 the respondent and her daughter moved into the house with the appellant.

(b) 33 Griffiths Street, Sans Souci

In 1990 the respondent received from her former husband, Mr Stelzer, under a property settlement on their final separation and divorce, his share of the matrimonial home at 33 Griffiths Street together with a cash payment of between $80,000 and $90,000. Mr Stelzer agreed to provide an amount of $110 per week for the care of their daughter, Bree. In late 1994 the respondent sold this property for an amount which netted her $400,515. Shortly after settlement, on 25 January 1995, the respondent deposited this amount into six separate St George interest bearing deposit accounts in the name of Classic Developments Pty Limited.

(c) 117 Holt Road, Taren Point

Classic Developments Pty Limited was a company the appellant used as a vehicle for the development of a property at 117 Holt Road, Taren Point which the appellant and respondent bought in June 1994. The respondent contributed $91,842 and the appellant $275,659 to the purchase. Between May and November 1995, 117 Holt Road was subdivided and developed by building at the street frontage a two storey house, which remained known as 117 Holt Road, and a single storey dwelling on the battle-axe block with a right of carriageway, which became 117A Holt Road. Of the amounts in the interest bearing deposit accounts used for this purpose, the respondent contributed a total of $391,184 and the appellant about $299,000. Before development began, 117 Holt Road was leased. The rent received was $4,000. In addition the parties received approximately $16,000 interest on the interest bearing deposits. On 14 December 1995 the appellant transferred 117 Holt Road to the respondent. The consideration shown on the memorandum of transfer was $1. She moved into the premises in 1996. On 1 March 1996, 117A Holt Road was sold for $380,985. The proceeds of sale were placed into a joint account. In June 1998, pursuant to an interim order made by the Court, $200,000 was paid out of this account to the appellant. At the date of the hearing, approximately $243,000, which included accrued interest, remained in the joint account. The respondent was living at 117 and the appellant at 155 Holt Road.

THE RELATIONSHIP OF THE PARTIES

8 The appellant and respondent first met in 1970 when he was 25 and she was 19. Their relationship was platonic until 1974. Between 1967 and 1973 the respondent was in what she described as an intimate relationship with Mr Stelzer. That relationship ended in 1973. In 1974 the respondent became a flight attendant with TAA and lost contact with the appellant. They met again in 1975 and an intimate relationship between them began. In 1975 the respondent went to Singapore with friends and met Mr Stelzer again. Their previous relationship was renewed. When she returned to Australia the respondent informed the appellant that she had decided to end her relationship with him. In 1976 she married Mr Stelzer. Their daughter, Bree, was born in 1983 or 1984. The relationship ended in 1989.

9    In July 1989 the respondent telephoned the appellant and asked him to accompany her to dinner as her partner. At that time she was living with her daughter at 33 Griffiths Street. According to the respondent, from the date of the dinner, 11 August 1989, the de facto relationship began. Bergin J found that between 1989 and 1996 “a relationship of sorts” existed between the respondent and the appellant. In 1991 they went together with Bree on a holiday to Fiji. The relationship continued thereafter. In 1994 the parties decided to purchase a property together and develop it. They purchased 117 Holt Road.

10 Although Bergin J found that a sexual relationship began in August 1989, her Honour was not persuaded that a de facto relationship, as defined by the Act, existed until about March 1994 when the respondent decided to intermingle her finances with the appellant’s and later in 1994 made an overt commitment to the relationship when she decided to sell her home. The trial Judge found that the respondent was willing to take the extra step in about April or May 1994 when the parties decided to purchase 117 Holt Road.

FINANCIAL AND NON-FINANCIAL CONTRIBUTIONS

11    Bergin J made the following findings:

· The appellant conceded that his contribution to the improvement of 33 Griffiths Street to obtain a better price on its sale in late 1994 was a fairly conservative one. Her Honour assessed it as no more than 5%.

· At least from May to November 1995 the appellant spent an average of 11 hours a day for six days a week working on the 117 Holt Road construction. The project was completed in 29 weeks. The work was of high quality.

· At the date of the trial the value of each of 117 and 155 Holt Road was approximately $600,000.

· 117 Holt Road required remedial work to be done assessed to cost between $5,000 and $17,000.

· The appellant’s financial contributions to 117 Holt Road were about $100,000 less than the respondent’s. The appellant’s contribution by way of non-financial activity and contribution was far greater than the respondent’s.

12    Bergin J referred to the evidence of a quantity surveyor who quantified the appellant’s contribution to the construction of the buildings on 117 and 117A Holt Road as about $75,000. Her Honour said:

“So it is that it is not merely the assessment of the labour costs and hours spent by Mr McDonald, there is an additional non-financial contribution here that needs to be assessed. Certainly the financial contribution was such that it negatived the need to have a project manager to have someone running the jobs because Mr McDonald was there every day. Additionally it was his assessment of how best to save his and the [respondent’s] money in the way he approached the job. So, both in the facets of financial and non-financial contributions I regard Mr McDonald’s contribution as at least equivalent to a figure of $60,000. That figure is reached on an assessment of the evidence of the quantity surveyor having regard to some of the features to which Ms Heath [who appeared for the respondent] took him and her cogent submissions in respect of an approach that might be adopted in respect of it if the Court saw it as a joint venture.”

13    Bergin J went on to say that the figure was only a notional figure and referred to the respondent’s evidence that she attended the site and cleaned it and that she cooked for the workmen and helped with the landscaping and gardening.

14 When she came, in accordance with the Act, to adjust the parties’ interest in the property Bergin J said:

“The valuation of the property at 155 Holt and 117 Holt it seems to me should be equally at $600,000. It is too difficult in the circumstances of the evidence to make an accurate assessment without that elasticity. It is not a mathematical equation approach. It is what is just and equitable in taking into account the amount of money as referred to that the [respondent] has contributed, the amount of money that the [appellant] has contributed, what seem to me to be equal contributions as homemaker in the period that they were in a de facto relationship. It seems to me that a just and equitable result is that the [respondent] is entitled to the beneficial interest in the home at 117 Holt Road Taren Point.”

15    Her Honour next referred to the evidence of the accountants, Mr Benbow, retained by the appellant, and Mr Grahame, retained by the respondent, and said:

“131 The approach adopted by Mr Grahame is that if the Court were to find that Ms Stelzer retains 117 Holt Road, which I have decided should occur, and Mr McDonald retains $200,000 cash withdrawn, that Mr McDonald should pay to Ms Stelzer a figure of $13,131, this is on the basis of a notional return of the $200,000 and the balance of cash in the joint account being $243,000.
132 Mr Benbow’s approach is that the [property at] 117 Holt Road should be divided equally and that Ms Stelzer should receive $202,000 from the joint account and Mr McDonald $41,401 from the joint account. I am of the view that something between those two approaches is appropriate. In weighing up what is just and equitable it has been difficult to assess what extra should happen, if anything, to adjust the [respondent’s] interest, having decided that the [respondent] is entitled to the property at 117 Holt Road. She, of course, applies for $100,000 out of the remaining $243,000. I think that is too much in the circumstances. I regard the contributions and the approach to the project and the shortness of this relationship as a de facto relationship as something I should take into account in reaching the conclusions that I have.
133 Assuming that the value of the property is $600,000, it seems to me that the [respondent], although contributing equally to the homemaker aspect of 155 Holt Road and not in any meaningful way to the financial side of 155 Holt Road, should have no more than a figure of $25,000 payable out of the joint account.
134 It seems to me that such a figure in addition to an asset worth $635,000 (on the [appellant’s] valuation) would be extremely generous. Indeed it may be thought that such a figure in addition to an asset worth $575,000 (on the [respondent’s] valuation) is an appropriate adjustment. However I have placed a value of $600,000 on the property and I regard it in all the circumstances of this case as just and equitable that the [respondent] should have an additional $25,000.”

16    Bergin J declared, as I read it, that the respondent should have from the parties’ property as her own, 117 Holt Road and $25,000. In addition she retained the balance of $101,173 withdrawn by her from the income bearing deposit accounts after completion of the development work. The $25,000 was to be paid from the joint account into which the proceeds of sale of 117A Holt Road had been paid. The appellant was to have the balance of $218,000 ($243,000 - $25,000). In the result and assuming that each of 155 and 117 Holt Road was worth $600,000 as her Honour held, the appellant came away with property to the value of $1,018,000 and the respondent with property to the value of $726,173, the first being 58.37% of the total and the second 41.63%.

GROUNDS OF APPEAL

17    The appellant’s amended notice of appeal contained fifteen grounds of appeal. Grounds 1, 3-6, 8, 9 and 13 were abandoned. The remaining grounds were:

“2. The Trial Judge erred in not finding that the financial and non financial contributions made directly and indirectly on behalf of the appellant and the respondent to the acquisition, conservation and improvement of 117 Holt Road, Taren Point and 117A Holt Road, Taren Point were equal.
7. The Trial Judge failed to identify or to value the non financial contributions made directly or indirectly by or on behalf of the appellant or the respondent to the acquisition, conservation or improvement of 155 Holt Road, Taren Point, 117 Holt Road, Taren Point or 117A Holt Road, Taren Point or to the financial resources of the appellant and the respondent or either of them.
10. The Trial Judge erred in failing properly to take into account or to value the benefit, notional or otherwise, received by the respondent as a result of her occupation of 117 Holt Road, Taren Point between approximately January 1996 and the date of hearing.
11. The Trial Judge erred in finding that the labour contribution of the appellant to the Holt Road development was no greater than $60,000.00.
12. The Trial Judge erred in failing to give sufficient reasons for the findings made by her as to the basis for the Orders made in favour of the respondent.
14. The Trial Judge erred to the extent that she had regard to the non financial contributions made directly or indirectly by or on behalf of the respondent to the acquisition, conservation or improvement of the property of the appellant or the respondent or either of them or to the financial resources of the appellant or the respondent or either of them which were made prior to the commencement of the de facto relationship.
15. The orders proposed by the Trial Judge in her Reasons for Judgment were, as an exercise of discretion, manifestly wrong and unjust.”

18    The respondent filed a notice of contention which challenged Bergin J’s finding of the value of the appellant’s non-financial contribution to 117 Holt Road and contended that Bergin J should have found that the respondent “made the majority of the financial and homemaking contribution to the running of the parties’ household in the period of cohabitation”.

ARGUMENT ON APPEAL

19    The appellant submitted that Bergin J’s orders left the respondent about $100,000 better off than she should have been if an appropriate order had been made. The appellant set out to demonstrate this point by calculating the financial contributions made by each party, treating those contributions as returnable to the contributor and then dividing the remaining balance or profit equally. This approach assumed that the non-financial contributions were equal and was said to be justified by the relatively short period during which the de facto relationship existed and by the financial consequences to the parties of Bergin J’s orders. To this were added arguments that Bergin J had wrongly taken into account non-financial contributions made before the relationship existed. Further, the appellant submitted that Bergin J discounted the value of the appellant’s contribution to the development construction work from $75,000 to $60,000 without giving reasons which justified this course and ultimately made orders without giving reasons explaining why those orders were made.

20    Bergin J did refer to the submissions put to her on the respondent’s behalf at the trial. Miss Needham SC, who appeared with Ms Heath for the respondent on the appeal, emphasised two matters. First, that until 1994 the respondent owned and occupied her own house at 33 Griffiths Street. In order to join in the development venture she disposed of her home. In all the circumstances, the respondent, having made substantial contributions to the acquisition and improvement of the partners’ property and their financial resources and to the welfare of the appellant, would not be adequately compensated if she were left without her own home, conveniently in this case 117 Holt Road.

21    Secondly, the respondent gave evidence that, while the appellant was doing the development work over the 29 weeks and unable to do other remunerative work, she expended her net income of $270 per week in paying household expenses.

22    In Evans v Marmont (1997) 42 NSWLR 70 at 75 Gleeson CJ and McLelland CJ in Eq, in a joint judgment with which on the construction of the provisions of s20 of the Act Meagher JA agreed, and from which Mason P and Priestley JA dissented, quoted part of the reasons for judgment of Hodgson J, as his Honour then was, in Dwyer v Kaljo (1987) 11 FamLR 785 at 793. Hodgson J, in the context of the factors referred to in s20(1)(a) and (b), said in the passage quoted:

“In my view, some other factors will be relevant in this way in all cases. One such factor arises from the question whether the contributions of the plaintiff have been sufficiently compensated. The relevance of this question is confirmed by the terms of s17 of the Act. This in turn requires the court to reach some view of the value of the contributions of the plaintiff, and some view of the value of what the plaintiff has received in return.”

23    Gleeson CJ and McLelland CJ in Eq at 75 agreed in general with the observations of Hodgson J and said:

“It would be unrealistic to attempt to evaluate contributions of the kinds referred to in par (a) and par (b) for the purpose of determining what is just and equitable having regard to those contributions, in isolation from the nature and incidents of the relationship as a whole, relevant aspects of which may well include factors of the kinds mentioned by Hodgson J.”

24    As their Honours indicated at 79-80, paras (a) and (b) remain the focal points by reference to which the discretionary judgment as to what seems just and equitable must be made.

25 Relevantly, if the parties to the application had lived together in a de facto relationship for a period of less than two years, s17(2) of the Act required the Court before making an order under Pt 3 to be satisfied that the respondent had made substantial contributions of the kind referred to in s20(1)(a) or (b) for which the respondent would otherwise not be adequately compensated if the order were not made and that the failure to make the order would result in serious injustice. If so satisfied, the Court might in accordance with s20 adjust the partners’ property interests to achieve a just and equitable result having regard to the contributions referred to in subs (1) (a) and (b).

26    Evans v Marmont did not directly address the conclusion reached by Powell J, as his Honour then was, in Roy v Sturgeon (1986) 11 NSWLR 454 at 466 that it was not open to the Court, when dealing with applications under s20 of the Act, to have regard to contributions said to have been made prior to the commencement of the particular de facto relationship. At 464 Powell J said that:

“although the provisions of s20 do not expressly limit the court to having regard to ‘contributions’ made only during the course of the ‘de facto relationship’, nonetheless there are indications in the Act, and, in particular, in s20 itself, that the range of relevant ‘contributions’ should be regarded as so limited. Thus, both s15 and s17 of the Act expressly direct attention to the period ‘the parties to the application have lived together’. Even more to the point is the reference in s20(1)(b) to a partner’s ‘contributions’ as ‘homemaker or parent…. to the welfare of the other…. partner or to the welfare of the family…’ a reference which seems to me to contain within its own terms a limitation as to the period during which any contributions might have been made.”

27    Powell J went on to point out that in In the marriage of Olliver (1978) 32 FLR 129 the Full Court of the Family Court of Australia relied on particular provisions in the Family Law Act 1975 (Cth), particularly ss79(4) and 75(2)(k) and (o), to conclude that regard might be had to any pre-marital cohabitation between the parties in an application under s79 of that Act to alter the interests of the parties to a marriage in the property of the parties.

28    Bergin J referred to Griffiths v Brodigan (1995) 20 FamLR 822 in which Chisholm J did not follow Roy v Sturgeon on this point. Bergin J said:

“106 Of course in Roy v Sturgeon Powell JA was dealing with the relationship prior to the decision of the Court of Appeal in Evans v Marmont. The plaintiff relies on Evans v Marmont as suggesting that this realistic and global approach would allow pre-relationship facts to be taken into account.
….
109 It seems to me, however, that Evans v Marmont requires me to be realistic and I don’t believe it is appropriate for me to ignore the nature of the relationship between the parties and the general contribution they made to each other by way of conserving property and financial resources and by way of homemaking if it occurred prior to the de facto relationship. In all the circumstances of this case I am going to take into account the nature of the relationship of the parties prior to the de facto relationship in reaching my conclusion as to what is just and equitable. It seems to me it would be unrealistic not to look at it.”

29    No doubt this part of the reasons for judgment led to the insertion of ground 14 of the grounds of appeal. As was submitted by Mr Broun QC on behalf of the appellant, it is difficult to ascertain from the reasons for judgment the extent to which Bergin J had regard to financial or non-financial contributions made before April 1994 when the respondent was found to have entered into a de facto relationship with the appellant. The property at 117 Holt Road was purchased in June 1994 when the parties made their contributions to the purchase price. The respondent’s home at 33 Griffiths Street was sold later and the respondent deposited the proceeds into the income bearing deposit accounts in January 1995. The appellant worked on the development over a period which began in May 1995. During this time the respondent paid the household expenses. Undoubtedly, these contributions made after the relationship came into existence were the most significant contributions to the property of the partners.

30    At trial the respondent’s case was that her relationship with the appellant became a de facto relationship in August 1989. Her submissions therefore covered contributions she made particularly in the capacity of homemaker before April 1994.

31 Bergin J did not identify and give weight to any particular non-financial contributions made before the de facto relationship began. The appellant, in effect, invited us to find error and then ourselves to determine what order should be made under s17(2) of the Act. However, as I have said, this argument was based on calculations designed to determine the total value of the property of the parties at the time of trial, deduct their contributions and divide the balance equally. While a formulaic approach to property adjustment may assist to determine what adjustment, if any, should be made, particularly if the relationship was short, it must not be allowed to set at nought other considerations such as the non-financial detriment suffered by selling a home in order to make a financial contribution and the real value of non-financial contributions.

32    I am not persuaded that her Honour erred in reaching her decision. Nor am I persuaded that her Honour erred in valuing the appellant’s work contribution to the development at $60,000. To my mind an important consideration in determining what adjustment should be made is that the respondent effectively contributed the home that she owned and occupied with her daughter to the joint venture. Had she not done so the joint venture could not have gone forward. Furthermore, the appellant was able to progress the work because the respondent used her salary, during the period, to pay the family household expenses. I am not persuaded that, putting aside altogether the non-financial contributions made before April 1994, her Honour’s orders were not appropriate. If anything the division of the partners’ property which resulted from Bergin J’s orders favoured the appellant.

ORDERS

33    The appeal should be dismissed with costs.

34    PRIESTLEY JA: I agree generally with Sheller JA. I add that, in the circumstances of the present case, if Bergin J did take into account in reaching her conclusion any circumstances of or related to the relationship between the parties which occurred before April 1994, I would not think that that vitiated her decision.

35    In Evans v Marmont (1997) 42 NSWLR 70, Gleeson CJ and McLelland CJ in Eq referred with approval to some observations made by Hodgson J at first instance in Dwyer v Kaljo (1987) 11 Fam LR 785. They said:

“ The following aspects of the approach adopted by Hodgson J are significant. He began by repeating four questions formulated by Powell J in earlier cases. Those questions set out, in a convenient sequence, certain matters which arise for consideration under s 20. There is nothing in the precise formulation of the questions, or in the sequence, which is, or was seen to be, rigidly binding. Having done that, Hodgson J went on to refer to some matters more likely to be contentious.
First, he repeated and accepted what had been said in a previous case by Young J ( Wilcock v Sain (1986) 11 Fam LR 302), to the effect that the factors referred to in par (a) and par (b) of s 20(1) are fundamental factors influencing the judgment of the court. Hodgson J then said (at 793):
‘... I also agree with Young J that this is not the only factor which can be taken into account. In my view, if one considers the plaintiff’s contributions and nothing else, this cannot conceivably lead to any view on what is just and equitable in the circumstances. However, it seems to me that the other factors can have no independent bearing on, what is just and equitable. Their relevance is only by reason of such relevance as they may have to the question: what is just and equitable having regard to the plaintiff’s contributions?
In my view, some other factors will be relevant in this way in all cases. One such factor arises from the question whether the contributions of the plaintiff have been sufficiently compensated. The relevance of this question is confirmed by the terms of s 17 of the Act. This in turn requires the court to reach some view of the value of the contributions of the plaintiff, and some view of the value of what the plaintiff has received in return.
In most cases, I think the financial circumstances of the parties will be relevant. Certainly, it is necessary for the court to ascertain what the property of the parties comprises at the time of the hearing, because it is to this that any adjustments of interest have to be made. Further, I think that in most cases the needs and means of the parties will have general relevance, as subsidiary factors, to the question of what is just and equitable having regard to the plaintiff’s contributions. However, as indicated earlier, I accept that the needs and means of the parties has no relevance except via its relevance to this question: in particular, the court cannot say that because the defendant has $11 million, and the plaintiff has something less than $50,000, for that reason it is just and equitable to make an adjustment.
Other circumstances which may be relevant include such matters as the length of the relationship, any promise or expectations of marriage, and also I think opportunities lost by the plaintiff by reason of the plaintiff’s contributions. This is by no means intended to be exhaustive. I do not think any limit can be set on what circumstances may be relevant, remembering always that the relevance must be to the question, what is just and equitable having regard to the plaintiff’s contributions.’
In general, we agree with those observations. It would be unrealistic to attempt to evaluate contributions of the kinds referred to in par (a) and par (b) for the purpose of determining what is just and equitable having regard to those contributions, in isolation from the nature and incidents of the relationship as a whole, relevant aspects of which may well include factors of the kinds mentioned by Hodgson J. ” (at 74-5)

36    Reference to Young J’s statement in Wilcock v Sain accepted by Hodgson J in the passage cited from him above, shows that Young J in turn adopted what had been said by Mason J about “have regard to” in R v Hunt (1979) 25 ALR 497.

37    In that case the question about the words arose under s 40AA(7) of the National Health Act. This subsection provided what the Permanent Head of the relevant Department must do when determining fees that might be charged by a nursing home. In the High Court the case was heard by Gibbs CJ, Mason J and Murphy J. On the point now relevant Mason J said:

“ The prosecutor’s case is that the Minister has failed to consider and determine the application for review according to law because he has failed to have regard to ‘costs necessarily incurred in providing nursing home care in the nursing home’. In support of this case the prosecutor relies on s 40 aa (7). It provides: ‘The Permanent Head shall, in determining the scale of fees in relation to a nursing home for the purposes of sub-paragraph (i) of paragraph (c) of the last preceding sub-section, have regard to costs necessarily incurred in providing nursing home care in the nursing home.’...
When sub-s (7) directs the Permanent Head to ‘have regard to’ the costs, it requires him to take those costs into account and to give weight to them as a fundamental element in making his determination. There are two reasons for saying that the costs are a fundamental element in the making of the determination. First, they are the only matter explicitly mentioned as a matter to be taken into account. Secondly, the scheme of the provisions is that, once the premises of the proprietor are approved as a nursing home, he bound by the conditions of approval not to exceed the scale of fees fixed by the Permanent Head in relation to the nursing home. In many cases it is to be expected that the scale of fees will be fixed by ascertaining the costs necessarily incurred and adding to them a profit factor. In the very nature of things, the costs necessarily incurred by the proprietor in providing nursing home care in the nursing home are a fundamental matter for consideration.
However, the sub-section does not direct the Permanent Head to fix the scale of fees exclusively by reference to costs necessarily incurred and profit. The sub-section is so generally expressed that it is not possible to say that he is confined to these two considerations. The Permanent Head is entitled to have regard to other considerations which show, or tend to show, that a scale of fees arrived at by reference to costs necessarily incurred, with or without a profit factor, is excessive or unreasonable. It may be that the rent paid by the proprietor of a nursing home, though a cost necessarily incurred, exceeds the prevailing rental which is paid for comparable premises and that the determination of a scale of fees by reference to that rent would result in a scale of fees which is unreasonably high. The Permanent Head would be entitled to take this factor into account in making his determination. ” (at 502,504)

38    Gibbs CJ agreed with Mason J (at 500). Murphy J dissented as to the result of the case, but on the point relevant to the present case said:

“ The requirement that the Permanent Head (and on review, the Minister) shall have regard to the costs necessarily incurred, tends in itself to show that his duty in respect of those costs is limited to having regard to them. He must take them into account and consider them and give due weight to them, but he has an ultimate discretion. He is not bound to increase the scale of fees on a basis which incorporates the whole or any part of the increased costs (see Ishak v Thowfeek [11968] 1 WLR 1718 at 1825 (PC)) but, of course, he may do so if in his opinion it is proper to fix such a scale for the nursing home. ”

39 From my reading of the evidence in the case along with Bergin J’s reasons, it seems relatively clear that the only matters before April 1994 that she may have taken into account in reaching her conclusion were matters very closely connected in subject matter, time and relevance to financial and non-financial contributions during the period of the full de facto relationship found to have begun in April 1994. These pre April 1994 matters seem to me to fall into the category of proper extra matters which Gleeson CJ and McLelland CJ in Eq indicated could be given some but not fundamental weight. On that basis Bergin J would have been entitled to take those matters into account provided she treated the financial and non-financial contributions after April 1994 as fundamental. It seems clear that she at least did this. If Bergin J gave the pre April 1994 matters some weight, but not fundamental weight (which in my view is the most she possibly did) then that would have enabled her, after realistic consideration of the nature and incidents of that relationship as a whole after its beginning (for purposes of the De Facto Relationships Act) in April 1994, to come quite properly to her conclusion.

40    I agree with the orders proposed by Sheller JA.

41    HANDLEY JA: I agree with Sheller JA.

*****