Merrett and Merrett
[2010] FMCAfam 1115
•11 November 2010
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| MERRETT & MERRETT | [2010] FMCAfam 1115 |
| FAMILY LAW – Parenting and property – non physical controlling and coercive violence – relocation – non disclosure. |
| Family Law Act 1975, ss.60B, 60CA, 60CC, 61DA, 65DAA |
| Black & Kellner (1992) FLC 92-287 Giunti & Giunti (1986) FLC 91-759 Hickey & Hickey & Attorney-General of the Commonwealth of Australia (Intervenor) (2003) FLC 93-143 MH & MZ (2005) FLC 93-266 Kennon & Kennon (1997) FLC 92-757 Kowaliw & Kowaliw (1981) FLC 91-092 Mezzacappa & Mezzacappa (1987) 11 Fam LR 957 Money v Money (1994) FLC 92-485 MRR v GR [2010] HCA 4 Norbis & Norbis (1986) 161 CLR 513 Pierce & Pierce (1998) FLC92-844 Weir (1993) FLC 92-338 Williams & Williams [2007] FamCA 313 |
| Applicant: | MR MERRETT |
| Respondent: | MS MERRETT |
| File Number: | SYC 6227 of 2008 |
| Judgment of: | Altobelli FM |
| Hearing dates: | 6-7 April, 9 July & 19 August 2010 |
| Date of Last Submission: | 19 August 2010 |
| Delivered at: | Sydney |
| Delivered on: | 11 November 2010 |
REPRESENTATION
| Counsel for the Applicant: | Ms Hausman |
| Solicitors for the Applicant: | Swaab Attorneys |
| Respondent: | Self represented |
ORDERS
That the parties have equal shared parental responsibility for the two (2) children of the marriage, [X], born [in] 2005 and [Y], born [in] 2006 (“the children”).
The children live with the wife in Sydney as indicated in these orders.
That the children spend time with the husband at the following times:
(a)Until [Y] commences school in 2012:
(i)Every Tuesday from 2.30pm (or from after school or pre-school as the case may be) to Wednesday at 9.00am (or before school or pre-school as the case may be) with the husband to be responsible for collection and return of the children;
(ii)Every Friday from 4.30pm to Sunday at 4.30pm with the husband to be responsible for collection and return of the children;
(iii)The first half of the school holidays in even numbered years and second half in odd numbered years;
(iv)9.00am to 6.00pm Father’s Day the husband to collect and return the children from and to the wife’s residence.
(v)Such further time or variation of time as agreed, including time as agreed on each of the children’s birthdays and the husband’s birthday.
(b)Once [Y] commences school in 2012:
(i)For a period of six (6) consecutive nights commencing from after school on Friday in week one (1) to before school on the following Thursday with the husband to be responsible for collection and return of the children from their school;
(ii)The first half of the school holidays in even numbered years and second half in odd numbered years;
(iii)9.00am to 6.00pm Father’s Day the husband collect and return the children from and to the wife’s residence;
(iv)Such further time or variation of time as agreed, including agreed time on each of the children’s birthdays and on the husband’s birthday.
That the time that the children spent time with the husband as set out in Order 3, be suspended on Mother’s Day each year and during such times as the children live with the wife during school holidays.
That both parties be permitted to attend all school and extra curricular activities in which the children, or either of them, may be involved, albeit that these activities take place in the other party's time with the children.
That each party have telephone communication with the children each day when the children are with the other party, prior to 9:00 am and between 6:00 pm and 7:30 pm.
That each party be restrained from changing the children's residence more than 30 minutes driving distance from [J] Kindergarten without the prior written consent of the other party.
That if either party changes his/her residence or his/her telephone number (including landline and mobile) that he/she provide the other party, with no less than 30 days prior written notice of the proposed change of address and with written notice of the new telephone number, immediately after same has been changed.
That if either party takes the children outside New South Wales that he/she provide the other with the address and telephone numbers of where the children will be staying.
That each party immediately notify the other party if the children or either of them is seriously ill or requires any medical procedures or operations.
That each party authorise the children's doctors, dentists and any other professionals with whom the children may consult from time to time, to provide to the other party any information or reports that he/she may require.
That each party authorise the children's kindergarten/school to provide to the other party, all information relating to the children, including copies of the children's school reports, school bulletins and notification of parent/teacher functions and all school activities and extra curricular activities in which the children or either of them may be involved.
That the parties do all acts and things and sign all necessary documents in order to cause [Y] to increase his days at [J] Kindergarten to 3 days per week commencing January 2011.
That within 14 days of the date of orders that the wife do all acts and things to join with the husband and sign all necessary documents in order to enrol the children at [A] School, [B] School, [C] School and [D] School.
That until such time as the children obtain a place at one of the private schools referred to in paragraph 14 that the children attend [D] School.
That the Husband pay or cause to be paid the children's school fees and associated costs, including but not limited to books and stationery, uniforms and shoes, sporting equipment and sports uniforms and extra-curricular activities as agreed.
That the parties use a communication book to communicate about issues relating to the children.
That the parties forthwith do all acts and things and sign all necessary documents in order to attend a post separation parenting program as soon as practicable with Relationships Australia or such similar organisation with a focus on cooperative parenting.
That each party be restrained from denigrating the other party in the presence of or in the hearing of the children and from allowing any other person to do so.
That each party be restrained from discussing these proceedings in the presence of or in the hearing of the children and from allowing any other person to do so.
Property
That the husband pay to the wife the sum of $46,000 within 30 days after which interest shall accrue at the rate prescribed under the Family Law Act, its Rules and Regulations.
That contemporaneous with payment pursuant to Order 21, the wife do all acts and things and sign all necessary documents in order to transfer to the husband her right, title and interest in the properties situate and known as Property R ("Property R”) and Property Z ("Property Z").
That within 30 days the parties do all acts and things and sign all necessary documents in order to discharge the mortgages secured against Property R and Property Z ("the mortgages") and substitute fresh mortgages in the husband's name at the husband's cost and that the husband indemnify the wife in relation to the mortgages and any other sole, joint or corporate debts incurred up to the date of separation.
That except as provided above, each party retain to the exclusion of the other, all other property registered in his/her name or in his/her current possession or control, including each of their superannuation entitlements.
That if either party refuses or neglects to sign any document necessary to implement these orders, that a Registrar of the Federal Magistrates Court be appointed to sign the necessary document in lieu of the defaulting party.
Spouse Maintenance
That until such time as [Y] commences primary school that the husband pay or cause to be paid $650 per week towards the wife's rent, the money to be paid directly to the wife or as otherwise agreed in writing between the parties.
That at such time as [Y] commences primary school until the earlier of the following, that the husband pay or cause to be paid one half of the wife's rent up to a total amount of $250 per week, the money to be paid directly to the wife or as otherwise agreed in writing between the parties:
(i)the wife obtains full-time employment;
(ii)the children are no longer living with the wife;
(iii)[Y] completes his secondary education.
Leave to relist
Liberty is granted to relist this matter before Federal Magistrate Altobelli on seven (7) days notice as regards the interpretation, implementation or enforcement of these Orders.
IT IS NOTED that publication of this judgment under the pseudonym Merrett & Merrett is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYC 6227 of 2008
| MR MERRETT |
Applicant
And
| MS MERRETT |
Respondent
REASONS FOR JUDGMENT
Introduction
This case is about where two children should live and how much time they should spend with each of their parents It is also about their parents’ property settlement. [X] is five years old and his brother, [Y], will be four years old by the time these reasons are published. The applicant is their father, who is 37 years old and describes himself as a [occupation omitted]. He lives in an inner city suburb of Sydney. The respondent in these proceedings is the children’s mother. She is 35 years old, describes herself as a homemaker, and also currently lives in an inner city suburb of Sydney. The mother would like to have the children relocate with her to [B], in Queensland. The father opposes this.
Background
The parents commenced to live together in a de facto relationship in February 2000. For all practical purposes their assets at cohabitation were negligible. Both were working in different jobs and they commenced cohabitation in an inner city suburb of Sydney. They married in January 2003. Later that year, the husband purchased, in his name, the property which became the matrimonial home. There is no dispute between the parties that it was purchased as a result of a very substantial deposit provided by the paternal grandmother. The balance of the purchase price was borrowed from a bank. The father in these proceedings continues to occupy that home.
In 2004 the father, who had already been working in the [omitted] industry in his own capacity, incorporated a company with himself as sole director and shareholder. This company became the vehicle through which he carried on his business as a [omitted]. As it turns out, I will make findings that the company was a convenient vehicle for this family to structure its finances up until the date of separation but, for all practical purposes, the finances of the husband, wife and the company were so intertwined that any distinction drawn between them is an artificial one.
During the course of 2004 the husband commenced to trade in shares. The evidence indicates that, in the long run, this was not successful and indeed the parties suffered a loss. There was only the faintest argument on the mother’s side that this loss constituted a waste, and there is no evidence to support this. The impression that I have formed is that if the share trading activities had been successful, the family would have enjoyed the benefits of this.
In January 2005, the father in these proceedings agrees that he caused to be transferred a one half share in the family home to the wife, as part of an asset protection exercise. The property was substantially renovated in 2005 – 2006.
My impression from all of the evidence is that the marriage was a troubled one almost from the beginning. Certainly by 2006 – 2007 it was stressful for both the husband and the wife. In October 2007 they attended marriage counselling. In December 2007 the parties purchased in the mother’s name a property in another Sydney inner city suburb which was used for an office for the business conducted by the father.
Separation occurred in October 2008, after the mother and father had been cohabiting for about eight years. [Y] was two years old, and [X] three years old at the time of separation. For the most part, the children have been in the care of their mother. At the time of separation she relocated to Queensland without the husband’s knowledge or consent. He commenced proceedings in this Court almost immediately.
On 31 October 2008 the mother and the father, both duly represented, entered into consent orders that provided for equal shared parental responsibility, for the children to return with the mother to the matrimonial home, for the children thereafter to live in Sydney and to have contact with their father on Tuesday, Friday and Saturday nights each week. The parents also agreed that the mother would vacate the home by 30 November 2008 but that the father would pay, initially for a fixed period of six months, the mother’s rental of $650 per week, a four week bond, reasonable water, gas and electricity expenses, the children’s preschool and extracurricular expenses, and a sum of $200 per week. There was a further condition that the mother accommodate herself within a five kilometre radius of the family home.
When the mother moved from the family home into rented accommodation the mother and father divided between them the furniture and contents in the family home.
In November 2008 certain apprehended violence proceedings were initiated by the police on behalf of the mother and the children against the father. These proceedings were dismissed by a Local Court Magistrate in March 2009.
In September 2009 there were further orders made between the parents, by consent, relating to the children attending kindergarten and holiday contact. Then, in October 2009, I made orders in relation to the leasing of the office premises and the application of rentals towards repayment of a mortgage that was secured against the family home. As it turns out those orders were not complied with, with each party providing different explanations as to why this is the case.
The evidence indicates that throughout the course of the marriage and particularly in the latter years, the paternal grandmother has been very generous in providing financial assistance to the father either directly, or through his company.
The mother was represented by capable and competent lawyers until quite late in the proceedings. At the hearing she represented herself. When the mother was able to contain her emotions, she showed a truly impressive grasp of the relevant issues, was clearly on top of the evidence, and her cross-examination of the father was as good as many junior counsel could achieve. When she gave evidence, however, and in closing submissions, she was intensely emotional, and sometimes distraught. The hearing extended over four days, 6 and 7 April, 9 July and 19 August. The husband was at all times represented and his counsel at the hearing was Ms Hausman.
It was difficult at times to ascertain precisely what the mother’s proposals were. Doing the best I can, she would like to relocate the children to [B] in Queensland to be close to members of her family and a support system, and to be away from what she perceived to be the father’s intimidation, controlling behaviour and abuse. She proposed that there be contact during the school holidays. In relation to property settlement, she proposed the sale of the home and the office premises, and that she receive 75 per cent of the net proceeds, together with spousal maintenance of $300 per week until [Y] turns 18 in 2024.
The father’s proposal is contained in a detailed minute of order which is incorporated into the first schedule to these reasons. The father proposes equal shared parental responsibility and, in effect, a shared care arrangement for the children. Until 2012 the children would live with him 6 nights per fortnight, and from 2012 would be equal time. He also sought orders about where the children would be attending school. By way of property settlement the husband proposes that both properties be transferred into his name, and that he refinance all debts into his name. He offered to pay to the wife $650 per week towards her rental until such time as [Y] commences primary school in 2012, despite the fact that his minute of order only refers to $450 per week. Thereafter he proposes to pay one half of the wife’s rental up to $250 per week, subject to a number of conditions. It was part of the father’s case in the property settlement that there was, in fact, a negative equity. Moreover, the effect of the father’s proposals was that the mother would not be able to relocate with the children and would, in fact, need to live within a finite travelling distance of the children’s schools.
One of the real difficulties encountered in this case was that despite repeated requests, the mother was not able to articulate an alternative proposal should I not allow the children to be relocated to Queensland. At times when I formed the impression that the mother was unable to control her emotions, I formed the view that she was not able to concede in her own mind that I would not allow the children to relocate. She expressed concerns about not wanting to live either in the inner city or eastern suburbs of Sydney, close to where they already live, and of not being able to afford to live in a proximate area which would enable the children to continue attending their current school/kindergarten, let alone the private school that seems to be contemplated by both parents.
Both the mother and the father provided affidavit evidence and gave oral evidence both in chief and cross-examination. The maternal grandmother also gave evidence by way of affidavit and oral evidence in cross-examination. There were a number of supporting witnesses whose role in the proceedings was peripheral.
Expert evidence was given by Dr M, a child family and adult psychiatrist who was appointed as the Part 15 expert in this case. I will deal with his report dated 18 November 2009 in more detail below.
Mr B, a real estate valuer provided an affidavit setting out the value of real estate which was sworn on 30 April 2009. Ms D provided a report as to the value of the company in an affidavit sworn 24 April 2009. In the end result the mother chose not to require Mr B or Ms D to attend Court for the purposes of cross-examination. Dr M was not available on 19 August 2010, the final day of the hearing, and the mother chose not to seek an adjournment so that he could be cross-examined at a later date. I acknowledge that the mother was representing herself in these proceedings and was put in a situation where she had to make a number of practical decisions about calling experts taking into account cost implications. I explained to her both the implications of not testing the evidence of these experts, as well as the possible consequences of calling them unnecessarily. Whilst I think I would have been assisted, at least in part, if Dr M, and Ms D had been required for cross-examination, having regard to all of the evidence I doubt very much whether their evidence would have made a difference.
This case raises a number of issues, each of which will need to be explored by reference to the evidence. There are credit issues. Because the evidence of the mother and the father is so different on certain issues it is necessary for me to make findings about whose evidence should be accepted, where it conflicts. I will need to consider the expert evidence, even though none of the experts were cross-examined. Notwithstanding that, I do have the benefit of the evidence of both the mother and the father, as well as the other witnesses and the documents tendered at the hearing. This in itself is a way of testing the expert evidence. In the parenting proceedings there are many issues under section 60CC that will need to be considered in the context of establishing which order is in the best interests of the children. In the property proceedings one of the fundamental issues relates to the constitution of the asset pool and, in particular, whether the father has been forthright and frank in his disclosure to the Court. Another issue is what is the nature and extent of the father’s actual commitment to repay moneys advanced by his mother. I will also need to assess a contribution and future needs.
Applicable law - parenting
In determining parenting matters under Part VII of the Family Law Act the Court must regard the best interests of the child as the paramount consideration: s.60CA.
The objects and principles of Part VII are set out at s.60B:
60B Objects of Part and principles underlying it
(1) The objects of this Part are to ensure that the best interests of children are met by:
(a) ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child; and
(b) protecting children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence; and
(c) ensuring that children receive adequate and proper parenting to help them achieve their full potential; and
(d) ensuring that parents fulfil their duties, and meet their responsibilities, concerning the care, welfare and development of their children.
(2) The principles underlying these objects are that (except when it is or would be contrary to a child’s best interests):
(a) children have the right to know and be cared for by both their parents, regardless of whether their parents are married, separated, have never married or have never lived together; and
(b) children have a right to spend time on a regular basis with, and communicate on a regular basis with, both their parents and other people significant to their care, welfare and development (such as grandparents and other relatives); and
(c) parents jointly share duties and responsibilities concerning the care, welfare and development of their children; and
(d) parents should agree about the future parenting of their children; and
(e) children have a right to enjoy their culture (including the right to enjoy that culture with other people who share that culture).
(3) For the purposes of subparagraph (2)(e), an Aboriginal child’s or Torres Strait Islander child’s right to enjoy his or her Aboriginal or Torres Strait Islander culture includes the right:
(a) to maintain a connection with that culture; and
(b) to have the support, opportunity and encouragement necessary:
(i) to explore the full extent of that culture, consistent with the child’s age and developmental level and the child’s views; and
(ii) to develop a positive appreciation of that culture.
At the very core of the new Part VII of the Family Law Act 1975 is the creation of a presumption of equal shared parental responsibility in s.61DA. Section 61DA provides:
61DA Presumption of equal shared parental responsibility when making parenting orders
(1) When making a parenting order in relation to a child, the court must apply a presumption that it is in the best interests of the child for the child’s parents to have equal shared parental responsibility for the child.
(2) The presumption does not apply if there are reasonable grounds to believe that a parent of the child (or a person who lives with a parent of the child) has engaged in:
(a) abuse of the child or another child who, at the time, was a member of the parent’s family (or that other person’s family); or
(b) family violence.
(3) When the court is making an interim order, the presumption applies unless the court considers that it would not be appropriate in the circumstances for the presumption to be applied when making that order.
(4) The presumption may be rebutted by evidence that satisfies the court that it would not be in the best interests of the child for the child’s parents to have equal shared parental responsibility for the child.
If the presumption applies, I am required to consider certain things:
65DAA Court to consider child spending equal time or substantial and significant time with each parent in certain circumstances
Equal time
(1) If a parenting order provides (or is to provide) that a child’s parents are to have equal shared parental responsibility for the child, the court must:
(a) consider whether the child spending equal time with each of the parents would be in the best interests of the child; and
(b) consider whether the child spending equal time with each of the parents is reasonably practicable; and
(c) if it is, consider making an order to provide (or including a provision in the order) for the child to spend equal time with each of the parents.
Substantial and significant time
(2) If:
(a) a parenting order provides (or is to provide) that a child’s parents are to have equal shared parental responsibility for the child; and
(b) the court does not make an order (or include a provision in the order) for the child to spend equal time with each of the parents; and
the court must:
(c) consider whether the child spending substantial and significant time with each of the parents would be in the best interests of the child; and
(d) consider whether the child spending substantial and significant time with each of the parents is reasonably practicable; and
(e) if it is, consider making an order to provide (or including a provision in the order) for the child to spend substantial and significant time with each of the parents.
(3) will be taken to spend substantial and significant time with a parent only if:
(a) the time the child spends with the parent includes both:
(i) days that fall on weekends and holidays; and
(ii) days that do not fall on weekends or holidays; and
(b) the time the child spends with the parent allows the parent to be involved in:
(i) the child’s daily routine; and
(ii) occasions and events that are of particular significance to the child; and
(c) the time the child spends with the parent allows the child to be involved in occasions and events that are of special significance to the parent.
(4) Subsection (3) does not limit the other matters to which a court can have regard in determining whether the time a child spends with a parent would be substantial and significant.
Reasonable practicality
(5) In determining for the purposes of subsections (1) and (2) whether it is reasonably practicable for a child to spend equal time, or substantial and significant time, with each of the child’s parents, the court must have regard to:
(a) how far apart the parents live from each other; and
(b) the parents’ current and future capacity to implement an arrangement for the child spending equal time, or substantial and significant time, with each of the parents; and
(c) the parents’ current and future capacity to communicate with each other and resolve difficulties that might arise in implementing an arrangement of that kind; and
(d) the impact that an arrangement of that kind would have on the child; and
(e) such other matters as the court considers relevant.
Because s.65DAA refers to the best interests of the child I must then go back to consider s.60CC which specifies how I must determine what is in a child’s best interests.
60CC How a court determines what is in a child’s best interests
Determining child’s best interests
(1) Subject to subsection (5), in determining what is in the child’s best interests, the court must consider the matters set out in subsections (2) and (3).
Primary considerations
(2) The primary considerations are:
(a) the benefit to the child of having a meaningful relationship with both of the child’s parents; and
(b) the need to protect the child from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence.
Note: Making these considerations the primary ones is consistent with the objects of this Part set out in paragraphs 60B(1)(a) and (b).
Additional considerations
(3) Additional considerations are:
(a) any views expressed by the child and any factors (such as the child’s maturity or level of understanding) that the court thinks are relevant to the weight it should give to the child’s views;
(b) the nature of the relationship of the child with:
(i) each of the child’s parents; and
(ii) other persons (including any grandparent or other relative of the child);
(c) the willingness and ability of each of the child’s parents to facilitate, and encourage, a close and continuing relationship between the child and the other parent;
(d) the likely effect of any changes in the child’s circumstances, including the likely effect on the child of any separation from:
(i) either of his or her parents; or
(ii) any other child, or other person (including any grandparent or other relative of the child), with whom he or she has been living;
(e) the practical difficulty and expense of a child spending time with and communicating with a parent and whether that difficulty or expense will substantially affect the child’s right to maintain personal relations and direct contact with both parents on a regular basis;
(f) the capacity of:
(i) each of the child’s parents; and
(ii) any other person (including any grandparent or other relative of the child);
to provide for the needs of the child, including emotional and intellectual needs;
(g) the maturity, sex, lifestyle and background (including lifestyle, culture and traditions) of the child and of either of the child’s parents, and any other characteristics of the child that the court thinks are relevant;
(h) if the child is an Aboriginal child or a Torres Strait Islander child:
(i) the child’s right to enjoy his or her Aboriginal or Torres Strait Islander culture (including the right to enjoy that culture with other people who share that culture); and
(ii) the likely impact any proposed parenting order under this Part will have on that right;
(i) the attitude to the child, and to the responsibilities of parenthood, demonstrated by each of the child’s parents;
(j) any family violence involving the child or a member of the child’s family;
(k) any family violence order that applies to the child or a member of the child’s family, if:
(i) the order is a final order; or
(ii) the making of the order was contested by a person;
(l) whether it would be preferable to make the order that would be least likely to lead to the institution of further proceedings in relation to the child;
(m) any other fact or circumstance that the court thinks is relevant.
In MRR v GR [2010] HCA 4 the High Court said
8. Sub-section (1) of s 65DAA is headed "Equal time" and provides:
"If a parenting order provides (or is to provide) that a child's parents are to have equal shared parental responsibility for the child, the court must:
(a) consider whether the child spending equal time with each of the parents would be in the best interests of the child; and
(b) consider whether the child spending equal time with each of the parents is reasonably practicable; and
(c) if it is, consider making an order to provide (or including a provision in the order) for the child to spend equal time with each of the parents." (emphasis added)
Sub-section (2) makes provision for where a parenting order provides that a child's parents are to have equal shared parental responsibility for the child (par (a)) but the Court does not make an order for the child to spend equal time with each of the parents (par (b)). In such a circumstance the Court is obliged to:
"(c) consider whether the child spending substantial and significant time with each of the parents would be in the best interests of the child; and
(d) consider whether the child spending substantial and significant time with each of the parents is reasonably practicable; and
(e) if it is, consider making an order to provide (or including a provision in the order) for the child to spend substantial and significant time with each of the parents."
Sub-section (3) explains what is meant by the phrase "substantial and significant time".
9. Each of sub-ss (1)(b) and (2)(d) of s 65DAA require the Court to consider whether it is reasonably practicable for the child to spend equal time or substantial and significant time with each of the parents. It is clearly intended that the Court determine that question. Sub-section (5) provides in that respect that the Court "must have regard" to certain matters, such as how far apart the parents live from each other and their capacity to implement the arrangement in question, and "such other matters as the court considers relevant", "[i]n determining for the purposes of subsections (1) and (2) whether it is reasonably practicable for a child to spend equal time, or substantial and significant time, with each of the child's parents".
A little later in the judgment the High Court said:
13. Section 65DAA(1) is expressed in imperative terms. It obliges the Court to consider both the question whether it is in the best interests of the child to spend equal time with each of the parents (par (a)) and the question whether it is reasonably practicable that the child spend equal time with each of them (par (b)). It is only where both questions are answered in the affirmative that consideration may be given, under par (c), to the making of an order…
Applicable law - property
The preferred approach to the determination of an application under s.79 of the Family Law Act is set out in a passage found in the Full Court’s decision in Hickey & Hickey & Attorney-General of the Commonwealth of Australia (Intervener) (2003) FLC 93-143 at 39.
The Full Court states that there are four inter-related steps:
a)Identify and value the property, liabilities and financial resources of the parties; and
b)Identify and assess the contributions of the parties and express them as a percentage of the net value of the property; and
c)Identify and assess the other facts relevant under s.79(4)(d)-(g) including s.75(2) and determine the adjustment (if any) to be made to the contribution entitlements at step two; and
d)Consider the effect of the above and resolve what order is just and equitable in all the circumstances.
One of the legal issues that often arises is whether I should adopt a global or asset-by-asset approach to contribution. The authority in this regard is, the High Court’s decision in Norbis v Norbis (1986) 161 CLR 513 per Wilson and Dawson JJ at 534-5. It is clear from this statement of the law that either approach is available to me, in part or in whole. My discretion in this regard should be exercised having regard to the facts of this case.
Another issue in this case is how, precisely, I should weigh and assess the initial contribution made by or on behalf of the parties. In this regard, I need to consider the decision of the Full Court in Pierce v Pierce (1998) FLC 92-844. A useful recent decision of the Full Court examines its earlier decision in Pierce v Pierce together with a later case. In Williams & Williams [2007] FamCA 313 the Full Court states as follows at paragraphs 26, 27, 28, 29 and 32:
26. We think there is force in the proposition that a reference to the value of an item as at the date of the commencement of cohabitation without reference to its value to the parties at the time it was realised or its value to the parties at the time of trial, if still intact, may not give adequate recognition to the importance of its contribution to the pool of assets ultimately available for distribution between the parties Thus where the pool of assets available for distribution between the parties consists of say an investment portfolio or a block of land or a painting that has risen significantly in value as a result of market forces, it is appropriate to give recognition to its value at the time of hearing of the time it was realised rather than simply pay attention to its initial value at the time of commencement of cohabitation. But in doing so it is equally as important to give recognition to the myriad of other contributions that each of the parties has made during the course of their relationship.
27. In Pierce v Pierce when speaking of the relevance to be paid to initial contributions the Full Court (Ellis, Baker and O’Ryan JJ) referred to Fogarty J in Money v Money (1994) FLC 92-485 at 81,054; (1994) 17 Fam LR 814 at 816:
…respective contributions of the parties over a long period of marriage “offset” the significance which might otherwise be attached to a greater initial contribution by one party…ultimately, when it comes to the trial such a contribution is one of a number of factors to be considered. The longer the marriage the more likely it is that there will be latter factors of significance and in the ultimate the exercise is to weigh the original contribution with all other, later, factors and those later factors, whether equal or not, may in the circumstances of the individual case reduce the significance of the original contribution.
28. The Full Court (Ellis, Baker and O’Ryan JJ) then said at [28]:
In our opinion it is … a question of what weight is to be attached, in all the circumstances, to the initial contributions. It is necessary to weigh the initial contributions by a party with all other relevant contributions of both the husband and the wife. In considering the weight to be attached to the initial contribution, in this case of the husband, regard must be had to the use made by the parties of that contribution.
29. Pierce v Pierce was a case in which the husband brought in $200,000 cash into the relationship. He applied that money towards the purchase of a matrimonial home. He was employed throughout the marriage and supported the wife who, whilst in some paid employment primarily attended to domestic tasks and taking care of the children. The Full Court assessed the parties’ respective contributions to a pool of $320,000 as 70 per cent in favour of the husband and 30 per cent in favour of the wife at the end of a 10 year relationship.
32. In MH & MZ (2005) FLC 93-226; (2005) 34 Fam LR 169 the Full Court (Kay, May and Boland JJ) allowed an appeal in a property case where a pool of assets of $1.12million had been assessed for contribution purposes as 75 per cent in favour of the husband and 25 per cent in favour of the wife. The Court in allowing the appeal indicated that an assessment of 75:25 fell outside the realms of an acceptable range saying at 79,730; 170:
Such an assessment ought adequately recognise that much of the parties’ wealth can be attributed to the capital growth in the assets introduced by the husband at the commencement of the marriage but at the same time bringing into consideration a myriad of other contributions each made in the course of their relationship.
Accordingly, I must not only identify the contributions of each party, but also assess the weight to be attributed to these contributions having regard to many factors including what has occurred afterwards.
A significant issue in this matter was the alleged non-disclosure of the husband. Attempting to deal with non-disclosure often puts the other spouse to considerable difficulty with regards to investigating their financial affairs. The Full Court in Weir (1993) FLC 92-338 at 79,593–4 made the following statement regarding the duty to disclose and the Court’s powers where non-disclosure has been found:
This Court has pointed out in a line of cases leading up to the recent decision of the Full Court in Black and Kellner (1992) FLC 92-287, that it is the duty of a party involved in property proceedings in this jurisdiction to make a full disclosure of their financial affairs. See also Giunti and Giunti (1986) FLC 91-759, and Mezzacappa and Mezzacappa (1987) 11 Fam LR 957; (1987) FLC 91-853. It is clear enough from his Honour's findings in the present case that the husband had not done so and had in fact pocketed the proceeds of a substantial number of cash sales. It is obvious that in most cases of this nature it is difficult enough for the other party to establish that fact let alone establish the quantum of what has been taken.
It seems to us that once it has been established that there has been a deliberate non-disclosure, which follows from his Honour's findings in this case, then the Court should not be unduly cautious about making findings in favour of the innocent party. To do otherwise might be thought to provide a charter for fraud in proceedings of this nature…
We appreciate that this is something of a broad brush approach, but, as we have said, where there is clear evidence of non-disclosure as there was here, the Court should not be unduly cautious about making findings in favour of the other party. It has been said by one commentator (O'Ryan and Broadfoot, 5th National Family Law Conference Handbook, p 249) the failure to disclose undermines the whole process of adjudication of proceedings for a settlement of property in that the court is unable to identify the property of the parties, to properly assess contribution, or to properly assess s 75(2) factors.
The wife raised what is, in effect, a waste argument. A succinct statement of the law in this regard is the statement by Baker J in Kowaliw and Kowaliw (1981) FLC 91-092 at 76 644:
As a statement of general principle, I am firmly of the view that financial losses incurred by parties or either of them in the course of a marriage whether such losses result from a joint or several liability, should be shared by them (although not necessarily equally) except in the following circumstances:
(a) where one of the parties has embarked upon a course of conduct designed to reduce or minimise the effective value or worth of matrimonial assets, or
(b) where one of the parties has acted recklessly, negligently or wantonly with matrimonial assets, the overall effect of which has reduced or minimised their value.
The final legal issue that arises in this case is that raised by the wife (at least by implication) – the extent, if at all, that her contributions were rendered more arduous as a result of various aspects of the husband’s conduct. The authority is the Full Court’s decision in Kennon and Kennon (1997) FLC 92-757. A useful summary of the decision is contained at page 84, 294 of the report:
Put shortly, our view is that where there is a course of violent conduct by one party towards the other during the marriage which is demonstrated to have had a significant adverse impact upon that party's contributions to the marriage, or, put the other way, to have made his or her contributions significantly more arduous than they ought to have been, that is a fact which a trial judge is entitled to take into account in assessing the parties' respective contributions within s 79. We prefer this approach to the concept of ''negative contributions'' which is sometimes referred to in this discussion.
In the above formulation, we have referred only to domestic violence, for the reasons which we indicated earlier, but its application is not limited to that…
However, it is important to consider the ''floodgates” argument. That is, these principles, which should only apply to exceptional cases, may become common coinage in property cases and be used inappropriately as tactical weapons or for personal attacks and so return this Court to fault and misconduct in property matters a circumstance which proved so debilitating in the past. In addition, there is the risk of substantial additional time and cost.
However, in our view, s 79 should encompass the exceptional cases which we described above. It would not be appropriate to exclude them as a matter of policy because of this risk. It is a matter of commonsense for the lawyers involved and, where that may not be sufficient, it is a matter for a firm hand by the Court at an early stage when a case appears to raise those issues.
It is essential to bear in mind the relatively narrow band of cases to which these considerations apply. To be relevant, it would be necessary to show that the conduct occurred during the course of the marriage and had a discernible impact upon the contributions of the other party. It is not directed to conduct which does not have that effect and of necessity it does not encompass (as in Ferguson) conduct related to the breakdown of the marriage (basically because it would not have had a sufficient duration for this impact to be relevant to contributions)…
The passage from the Full Court's decision in Kennon clearly indicates that it is a relatively narrow band of cases to which a Kennon-type adjustment would apply. The Full Court's decision focuses on conduct during the marriage, but not afterwards, which suggests the concept was not intended to apply to post-separation contribution. There is a clear emphasis by the Full Court on the need to establish that the violence had a discernable impact on the contributions made by one party. The focus seems to be on establishing either that there has been a significant adverse impact on a party's contributions, or that their contributions are significantly more arduous than they ought to have been. As I read the Full Court's decision, little or no room is left for inference. The claim can only be established by probative evidence that satisfies the Court on the balance of probabilities.
Credit issues
In most cases it is not necessary for the Court to make findings about whose evidence should be preferred, particularly in parenting cases, but even in property cases. Regrettably, that is not the case in these proceedings. In the parenting proceedings, for example, the mother makes very serious allegations against the father about his abusive and controlling behaviour. Likewise, the father makes some equally serious assertions about the mother’s physical violence towards him, and about her attitudes towards sustaining the children’s relationship with him. In the property proceedings the wife makes serious allegations against the husband about non-disclosure which, if accepted, has a consequential impact on the weight that I would place on the evidence of Ms D. It is therefore necessary for me to make observations and findings about credit issues
As a result of the mother’s careful, methodical and highly effective cross-examination of the father I am left with real doubts as to the veracity of any evidence he gives about financial matters. There are too many inconsistencies in his evidence. He was evasive, unresponsive and plainly unconvincing in many of his answers in cross-examination. It must be borne in mind that his case was that there was a negative equity, that the business conducted by him through the company was not and had not been making money for many years, and that, in short, the financial circumstances of this family was dire. Notwithstanding all of that, the orders he seeks present a rosy picture of optimism for the future. Thus, for example, he clearly believes that he is financially able to take over all of the liabilities of the parties, including refinancing debts out of the wife’s name, as well as to provide a substantial level of financial support for the wife, and the children, for a substantial period into the future. This is plainly inconsistent with the financial position that he presented to the Court and is also plainly inconsistent with the evidence about the lifestyle that he has enjoyed during the marriage, and subsequently. As I foreshadowed before, the company was a convenient vehicle to structure the husband’s finances and, for all practical purposes, the company is his alter ego. The paternal grandmother is the husband’s convenient banker and, as will be seen below, the father has used his own mother to finance his lifestyle whilst, at the same time, leading her to believe that she was financially supporting his business. His cross-examination is replete with examples of a lifestyle that is out of sync with the financial position he presents to the Court. Whether it be (and I so find) frequent eating out, purchase of a $14,000 Rolex watch, possession of substantial amounts of cash in the home, attending conferences and courses at luxury hotels, $25,000 membership of Stadium Australia, overseas holidays, retrospective loan agreements with his mother, $1000 gold pens, $4000 of body tattoos and a $1000 Armani jacket, what becomes apparent is that the husband has enjoyed a lifestyle quite inconsistent with the portrayal of his financial affairs to the Court. Moreover, the husband has done his credit no good at all by grossly minimising the extent of his consumption of pornography, and of the nature and extent of his controlling conduct of the mother.
By contrast, the most that can be said about the mother’s evidence is that it was often clouded by emotion. That clearly is because, through her eyes, looking back on the years, this relationship is fraught with pain, and creates significant anxiety for her. She asserts that her relationship with the father was one in which she was controlled by him, both financially and emotionally, and that she was intimidated and abused by him. As it turns out, and as I will discuss below, I accept her evidence in this regard. However, I find that she has, at times, exaggerated the nature and extent of this conduct of the father whilst minimised her own involvement in events that, she argued, were traumatic for the children. She has minimised the nature and extent of the father’s role in parenting and clearly fails to appreciate his significance in the lives of the children. But these are not credit issues to the same extent that they are credit issues for the father.
I thus need to be very careful about the father’s evidence on financial matters and, generally, and where his evidence conflicts with the mother, I need to be very careful about preferring his evidence over hers.
I found the evidence of the paternal grandmother to be convincing and I accept the same, both as to parenting and financial matters. Specifically, I accept that she has had a significant involvement in the lives of the children. I also accept that she has advanced moneys to the father with an expectation that it be repaid at some time. I do not exclude the possibility, however, that her expectation of repayment is by way of advance on an inheritance. It is regrettable that this scenario was not explored in cross-examination. Whilst I accept the paternal grandmother’s evidence, I also have a very strong impression that she was misled by her son as to the purposes of the many financial advances made by her to him. Clearly, she thought that the main reason for the moneys advanced was to help her son through difficult times in the business, and to help out in sustaining the mother and children in the post-separation period. Clearly, she was unaware of the extent to which her funds were used for lifestyle purposes, before and after separation.
Expert evidence
Dr M, a Sydney child, family and adult psychiatrist, provided a report to the Court dated 18 November 2009. This was based on interviews conducted on 4 and 5 November 2009 with the mother, father, paternal grandmother and children. I reproduce his opinion and recommendations and then make a number of comments:-
53. Opinion:
54. [X] and [Y] presented in an age appropriate manner. Each were observed to be progressing well developmentally. The only specific problem identified related to their articulation. It was my understanding that they had been referred for assessment by a speech therapist. They will benefit from appropriate intervention in this area. The boys were seen to have a loving connection with both parents and their paternal grandmother. [X] identified her as a significant figure in his life. This was consistent with the observed interactions between the children and the parties. [X] spoke positively about his mother’s friend, Mr S, with whom she had recently established an intimate relationship. The boys had enjoyed their interactions with the new male role model in their lives. I was informed by the mother that this was unlikely to be a long term connection. The mother acknowledged this use of physical discipline, as disclosed by [X]. Whilst I would not recommend or support this practice, I did not regard this practice as abusive.
55. Both parents were identified to have adequate parenting capacity. Whilst both had a history of emotional and behavioural vulnerability, there was no evidence at the time of assessment of any significant impairment in their mental state. The father readily acknowledged a history of polysubstance abuse, culminating in cocaine and heroin addiction. He had engaged in the twelve step Narcotics Anonymous program with great success. He had maintained abstinence from substances of abuse for a decade. Whilst the mother rejected the father’s assertions that she had a history of Post Natal Depression and associated emotional and behavioural problems, the history obtained was consistent with this proposition. The mother acknowledged emotional and behavioural difficulties but related this to the alleged history of domestic violence.
56. The issue of domestic violence was specifically explored. The mother did not assert that there had been any history of physical abuse. Rather, she claimed that she was subjected to emotional abuse, control, economic abuse and isolation, given the behaviour of the father. Whilst it may indeed be correct that the father was “not fair” in his distribution of income and expenditure on luxury items, as alleged by the mother, in my view this was not consistent with the mother’s allegations of domestic violence. Her assertion that he limited her contact with her family was not consistent with his support of her having twice yearly visits to family members in Western Australia and Queensland. Further, she acknowledged that at the time when she precipitously left with the children, following an argument between the couple, she had only very recently returned from visiting her older brother in [B]. It was noted that her complaints regarding her economic circumstances and social isolation, occurred in the context of the father providing her with a $500.00 per week budget in the past and current expenditure $650.00 per week for rental accommodation, plus $200.00 for expenses, plus payment of all utilities. This included the provision of a pre-paid mobile phone plan. The mother complained about these circumstances as well. It was also noted that the mother had been provided with one or two days per week of time out from the boys, as they were cared for by the paternal grandmother. Whilst it was acknowledged that there had been marital difficulties and arguments, it was not my view that the mother was a victim of significant domestic violence, as asserted. It was of concern that the mother’s position validated her view that she was not personally responsible but rather the father was to blame for any difficulties experienced.
57. This view was consistent with other aspects of the mother’s presentation. Although it was apparent that she had experienced profound adversity in her early development, including the death of her mother and twin sister at the age of two, no relationship with her biological father, separation from her siblings, placement with an older brother who played a significant parental role, the mother denied that any of these experiences had impacted upon her mental state or psychological development. Her inability to acknowledge psychological vulnerability was thus seen to be well established. Prior to her relationship with Mr Merrett, she had experienced a relationship characterised by domestic violence in the context of active substance abuse by her partner. The mother had indeed been a victim of domestic violence and had been exposed to experiences of recurrent separation and loss during her developmental years. It was also evident that Mr and Ms Merrett had experienced substantive difficulties in their relationship. It was, however, not my view that Mr Merrett had been the perpetrator of domestic violence in their relationship.
58. The children were identified to have a secure primary attachment to their mother and a secondary significant positive attachment to their father. They coped well with brief periods of separation from each of their parents and engaged well with each on their return. [Y], given his tender age, was noted to be more sensitive to the absence of each parent. Both were seen to have a loving connection with their parents and a desire to maintain these key relationships. This extended to their relationships with their paternal grandmother.
59. The father’s concerns that the mother was not considering the children’s best interest, was substantiated by her preoccupation with her own needs, rather than presented concerns for the children as her primary focus. Thus, her desire to relocate, ideally to be near her family, or at least to be in the outer metropolitan area of Sydney, related to her desire to have a house and backyard, to allow her to pursue her interest in [omitted]. This current interest, which was a focus of her play with the children, was apparently a focus of her relationship with her new boyfriend, Mr S, who was in the process of relocating to the country. She was not seen to prioritise the children’s needs, or consider the importance of residing near the father. She simply repeatedly stated that she did not have enough money to live in the Eastern suburbs. She rejected, without thoughtful consideration of alternatives, the father’s concern that the boys should have the best education possible, which he was prepared to fund.
60. The father, in contrast, presented as being primarily concerned about the boys’ development. He was motivated to provide them with the best possible education. When I challenged his proposal regarding [S] School and [B] School, given the family circumstances, he was seen to be able to reflect in a thoughtful manner regarding such issues and presented alternatives. It was thus unfortunate that the mother was unwilling to engage in such a dialogue. His motivation for the mother and the children to live within a reasonable radius of the family home in Property R, was understandable in light of his strong motivation to play an active and involved role in the children’s development. I would strongly support such a proposition. His concern that the mother would seek to relocate as far away as possible and reject his proposals regarding education, was consistent with the mother’s presentation at the time of assessment.
61. Recommendations:
62. There is no doubt that the children will benefit from the significant involvement of both parents in their lives into the future. It was my opinion that the current residential arrangements allowed for this. Once the children are of school age, I would support the father’s application for more extensive shared care parenting. It should, however, be recognised that if the lack of respectful communication continued, that this will be a source of ongoing stress for the children. It is unfortunate that attempts at dispute resolution had been unsuccessful. Despite the mother’s evident psychological vulnerability, she was unwilling to pursue psychological intervention or couple counselling. This was in contrast with the father’s motivation to assertively pursue psychological assistance. If the couple were able to agree, such assistance could be of value. Unfortunately there was no indication that the mother was willing to participate in a receptive manner. Under such circumstances, this is unlikely to be beneficial.
The opinion of Dr M about the strong relationship between the children, both parents, and the paternal grandmother are borne out by his observations, as well as the other evidence before me. What is particularly significant, but what, unfortunately, has been under-appreciated by the mother, is the strength of the boys’ relationship with their grandmother. Clearly, she is important to them and one wonders whether she has not been an island of peace and stability for the children amidst the storm of the parental conflict over the last few years.
It is clear that both the mother and father have a history of emotional and behavioural vulnerability. The other evidence before me leads me to conclude that the father has dealt with his far better than the mother. Despite the mother’s concerns, the evidence leads me to have no concerns about drug consumption or addiction issues with the father, or any concerns relating to an association with that former lifestyle. I fear, however, that the mother is still struggling to deal with both pre-cohabitation and post-cohabitation emotional issues. Even she concedes that she has only been receiving counselling and support in respect of what she considered to be an abusive relationship, in the last 12 months or so.
I daresay that if Dr M had available to him at the time of the report the same amount of evidence as I had during the course of the hearing, he would not have expressed paragraph 56 of his report in the terms stated. Of course, I had the benefit of spending several days with the mother and father, as opposed to several hours. I was able to observe them in the courtroom environment, and whilst under the pressure of cross-examination. Dr M may also, perhaps, have focussed too much on physical violence whilst failing to appreciate that some of the most pernicious forms of family violence are not physical at all, but include controlling behaviour, both physical and non-physical, emotional and financial, direct and indirect. Dr M appears to have accepted as reasonable the level of financial support provided by the father to the mother during the marriage, and even after separation, without having the benefit of observing the comparative lifestyle enjoyed by the father during these relevant periods. When this contrasting financial position is put in the context of other controlling behaviours, it is clear that the situation is far more pernicious than is described by Dr M at paragraph 56. These comments also extend to paragraph 57.
The rest of the evidence in this case is quite consistent with paragraph 58 of the report. Indeed the mother has perhaps failed to appreciate that despite her own very negative experiences of the relationship with the father, the children are positively attached to their father, they clearly need him and it is important that he has an ongoing role in their lives. The mother has minimised this. Perhaps the reason for this is set out at paragraph 59 where Dr M refers to the mother being preoccupied by her own needs. As will be seen below, there is some substance in this assertion, but one must not lose sight of the context of an abusive relationship.
It is significant to note that Dr M was of the view that once the children are of school age, he was prepared to support the father’s application for more extensive shared care parenting. He does acknowledge the difficulty caused by lack of communication, and implicitly lack of trust, in the context of a shared parenting arrangement. By no means have I interpreted his recommendations as being a carte blanche acceptance of the father’s proposal.
Dr M was asked a supplementary question pursuant to rule 15.65 of the Family Law Rules, by way of a letter dated 8 December 2009 from the solicitors for the father. His response dated 24 December 2009 is an annexure to the father’s affidavit. Clearly this correspondence has had an influence on the formulation of the father’s final proposal to the Court. Dr M suggests in his letter of 24 December 2009 that ideally the parents should be located within a 30 minute drive of each other’s residence and the children’s kindergarten. Dr M seems to have had difficulty in accepting the assumption that the children would attend [S] School, even though, as I will discuss below, by the end of the case the mother did seem open to this proposition subject to issues of cost and where she would be living. Dr M clearly articulates his opinion that it is not preferable for the children to live with the father if the mother wishes to relocate. This is a significant issue that I will need to consider below. He finally clarifies, in this letter, that the shared care arrangement that he was contemplating once the children are at school involved the children living with their father every Thursday and Friday and spending alternate weekends with him.
I consider the clearest messages emanating from Dr M’s reports are that relocation is not in the best interests of the children, but neither is being in the primary care of their father. The best solution, from his perspective, is that both parents and children remain living in an area geographically proximate to each other that enable a shared care arrangement to occur.
Expert evidence was given by Mr B, a real estate valuer. He valued the family home at $1,050,000, and the office used by the business at $138,000. In the absence of any contrary evidence from a cogent source, I accept this evidence.
The report prepared by Ms D and which comprises part of her affidavit sworn 24 April 2009 is problematic in that it was, for all practical purposes, entirely based on information provided to her by the father. As I have indicated above, I have real issues about whether his evidence can be accepted without question, particularly on financial issues. The summary and conclusions in her report are contained at paragraphs 2.4-2.8.
2.4 I have valued the interest of the Husband in [C] Pty Ltd using a net asset backing approach. There is no goodwill associated with the conduct of the business activities by the company.
2.5 I note that the continued trade of the company in the future is dependent on its ability to obtain home warranty insurance. Based on the financial statements as at 30 June 2008 and the interim management accounts as at 31 December 2008 the company has negative net tangible worth (NTW), which excludes related party investments and loans. Insurers generally require a positive NTW. Consequently, it would appear that the company may have difficulty in obtaining the required home warranty insurance. Therefore, in the absence of an injection of additional equity funding, its future viability may be at risk.
2.6 For the purpose of the valuation, I have included all related party loans as per the financial statement. Accordingly, the Form 13 Financial Statements of the Husband should disclose the following loans:
Husband (Liability)
Loan payable to [C] Pty Ltd (Appendix C) $99,558
2.7 Should there be no intention to repay or seek recovery of the loan accounts, the valuation of the company, and the Form 13 Financial Statements of the Husband must be amended accordingly. The forgiveness or any reduction in the recoverable amounts of the loans may impact on the income tax liabilities of the Husband or the company. I have not considered the tax exposure in relation to these loans.
2.8 As set out in paragraphs 3.10 and 3.11, the Husband has not received a salary from the company for the three years ended 30 June 2008, other than $6,000 in director’s fees in 2007 and 2008.
It will be seen, in due course, that the balance sheet proffered on behalf of the father contains as an asset the company with a valued of minus $160,000. In addition the balance sheet contains as liabilities a loan by the husband from the company of $99,558. This is in addition to a personal loan owed by the father to his mother, ie, the paternal grandmother, of $284,051. One of the issues that I will need to determine is the relationship between the moneys advanced on loan by the paternal grandmother to the father and/or company, and the extent to which this is reflected in the value of the company. In particular, I need to satisfy myself that there is no duplication of liability. It is therefore better that I give further consideration to the expert evidence of Ms D in the context of making findings about the pool of assets and liabilities. What I can indicate at this stage is that, on the evidence before me, the choice by Ms D of the net asset backing approach to valuation was the appropriate one. Whilst I note her observations at 2.5 about the difficulty that the company might have obtaining home warranty insurance without an injection of additional equity funding, I do not accept that the company’s future viability is at risk. The fact is that this company has had the benefit of home warranty insurance for many years in circumstances where it has made either losses (sometimes substantial) or very low profits. Indeed, I did not understand the father’s case to be that the future viability of the business was in jeopardy because of home warranty insurance issues. It was certainly part of his case that the global financial crisis has had an impact on the availability of work for the company, but there was no hint of a home warranty insurance problem.
Parenting
Meaningful relationship
The first of the primary considerations is the benefit to the children of having a meaningful relationship with both of the parents. All of the evidence before the Court indicates that there is a meaningful relationship in existence between the boys and both parents. On the father’s proposal there would be no change to this meaningful relationship. The boys would enjoy as much time with each parent as they currently do, and any changes in either the duration or frequency of that time will not be such as to affect the meaningful relationship that exists.
By contrast, the mother’s proposal must, by its very nature, bring about a significant change to the relationship that exists between the children and their father. The mother’s evidence is that she proposes to relocate the children to an unspecified place outside of [B] in Queensland. All that she could say is that it would be “in the vicinity of [B].” Her evidence was that the children and herself have been there once only, for a period of 10 days, and that was during a holiday. The mother’s brother and his wife are there together with their natural daughter, and a number of children for whom they are guardians. She explained that in order to travel to [B] one could fly to Brisbane, and then take a connecting flight to [B], or alternately fly to [omitted], and then drive about an hour to get to [B]. She explained that [B] was about a five hour drive north of Brisbane.
The mother’s proposal is that the father would have contact with the children for all of the mid-year school holidays, and four weeks over the Christmas holidays. The mother agreed that the boys have a close relationship with their grandmother who is an important person in their life. She agreed that the children currently spend three nights a week with their father and that, on her proposal, this would now change to once each school term, though I was under the impression that it could be more frequent than this if he travelled to [B]. The mother agreed in cross-examination that since the first consent orders were made after separation the boys have never had any significant period where they have been away from their father for more than two consecutive days at a time. She was cross-examined about the likely impact on the children of the reduction in the amount of time they currently enjoy with their father. In relation to [X] she thought that he would adapt, but didn’t know how he would be affected. When pressed, the mother agreed that he would miss his father, his grandmother, the kindergarten he attends, and his friends. When it was put to the mother that it would become hard for the children to maintain a relationship with their father if they only ever saw him once every 10 weeks the mother was unresponsive, and then stated rather glibly, “The children adapt to change to circumstances.”
It was clear from the mother’s evidence that she was minimising, or simply failed to appreciate, the impact of her proposal on the children’s relationship with their father. Given the age of these children, I would have real concerns about how a meaningful relationship with their father can be sustained on the mother’s proposal, given the tyranny of distance, and the problematic relationship between the parents, a matter to which I will refer to below. I record here that even though it was not raised by either parent, I would not accept that virtual visitation (ie, communication by Skype, email, telephone) would satisfactorily address any concerns I have about the potential impact on the children’s meaningful relationship of a move to [B]. Clearly, the mother’s proposal presents a significant challenge to the ability of these children to maintain a meaningful relationship with their father.
Protecting the children from harm
This primary consideration requires me to consider the need to protect the children from physical or psychological harm from being subjected to, or exposed to, abuse, neglect or family violence. These children have not been abused or neglected either directly or indirectly. On all of the evidence before me, and based on the mother’s own admissions in cross-examination, the only physical family violence to which they might have been exposed was violence perpetrated by the mother on the father. This was, I accept, an isolated incident which needs to be seen in the broader context of other issues of abuse and control.
I accept the mother’s case that she was in a relationship with the father that was, at times, characterised by abuse, intimidation and control. I base these findings on the father’s own evidence in cross-examinations. For example, he agreed that there was at least a time when he had denied the mother permission to see her family in [B]. He agreed that he had called the mother names, that he had called her fat, that he had said that she should not “wear so much make-up”, had called her a bitch, had yelled at her causing her to cry, had not consulted the mother in relation to financial matters such as trading in shares, provided her with a weekly allowance of $500 per week, or $26,000 a year, in circumstances where he had access to substantially greater funds, some of which were used for personal purposes.
The father acknowledged that only he had access to a safe in the house in which was stored jewellery, cash and important documents. He agreed that he liked buying expensive clothing, in circumstances where clearly he didn’t have to ask permission of the wife, but that if she had to spend more than $500 a week, she had to obtain his permission. The father agreed in cross-examination that he had said to the mother words to the effect: “I would have got bored with you even if you were Elle McPherson” and he agreed that a woman would find that comment degrading no matter what the context was.
When asked about the number of times he looked after both of the children by himself, the father agreed that this was about three times but added that it was “because you would never leave the house to go out”. This provides an interesting insight in the context of this case where the mother complains about being isolated. In the context of a discussion about public versus private schools for the children the mother put it to the father in cross-examination that he said: “You don’t know what you are fucking talking about.” The father agreed that he had said words to that effect. When challenged about speaking in that tone and language to the mother in the presence of another person, and as to whether it was appropriate the father responded: “With the words said by you prior to it, it all of a sudden escalated. It really was appropriate.” This, again, is an interesting insight into the father’s perspective of these events. In short, he was saying that the matter escalated because of actions of the mother. Nonetheless, it was appropriate. When challenged about not being allowed to have her own opinion, in the face of the father saying to her “you don’t know what you are effing talking about!” The father’s response was “I am stating my opinion”. At a later point in cross-examination the father again confirmed that his allowance to the mother and the children was $26,000 a year, in the context of him spending $25,000 to obtain a platinum membership of Stadium Australia, and annual fees of $1300 or $1400 associated with this. The father agreed that he spent $10,000 attending a six day conference at the Hyatt Coolum in Queensland.
The totality of the evidence, and particularly the father’s own evidence, leads to a finding that during the course of the relationship the mother was directly, and therefore the children were indirectly, exposed to non-physical family violence in the form of abuse, intimidation and controlling behaviour. Even if I am wrong in characterising some or all of this behaviour as falling within the definition of family violence in s.4(1) of the Act, and even if all or some of the conduct I have referred to above does not fall within the definition of abuse in the same subsection, the father’s behaviour is highly relevant under paragraphs (f), (g), (i) and (m) of s.60CC(3). If, however, the father’s behaviour does not fall within s.60CC(2)(b) then it may well be time for a reconsideration of what is meant by family violence or abuse for the purposes of the Family Law Act.
In the present case, in the end result it does not matter how, precisely, the father’s conduct is characterised. I need to consider the impact of this behaviour on the children, both in the past, in the present, and in the future. These are young children, and the strength of the father’s attachment and relationship with them suggest that his past conduct has not had an adverse impact on them. The father’s present relationship with the mother is a distant one and their communication and physical contact with each other revolves around the children, and this is a matter that can be managed. From a future perspective, however, to the extent that the father’s behaviour represents an attitude towards the children’s mother, it is of singular concern. In this regard he is an inappropriate role model. It completely excludes the possibility, in my mind, of the father having primary care of these children, a matter which is consistent with the views of Dr M. The extent to which it excludes the possibility of a shared care arrangement is a matter that I need to consider in the broader context of this case.
But does the mother need to move to [B] in order to protect herself, and the children, from the father’s behaviour? Why, for example, could not a move to another part of Sydney achieve the same result? Is it not possible to provide the mother with the protection that she no doubt believes she needs, whilst at the same time maintaining the meaningful relationship between the children and their father? That is, in many ways, the challenge that is presented in this case.
Views of children
This is not a relevant factor in this case. The children’s maturity and level of understanding contraindicates any weight whatsoever being given to any assertion by either party of the views of the children.
Nature of relationships
As is apparent from my comments above, the evidence clearly indicates the strength of the children’s relationship with each parent, as well as with the paternal grandmother. The mother’s proposed relocation to [B] presents a significant challenge to the maintenance of the children’s ongoing relationship with their father and grandmother.
Parental willingness and ability to encourage relationships
The evidence the mother gave in cross-examination leads to significant concerns in my mind about her willingness and ability to facilitate and encourage a close and continuing relationship between the children and the father. As I foreshadowed before she did not seem to have any real understanding about the challenges that the children will confront, on her proposal, in adapting to a situation where their father would largely disappear as a significant person in their life. Regrettably, the situation is actually worse than that. I fear that the mother was not even prepared to consider the impact of her move on the children. She glibly stated that she thought they would adapt.
At several points in her cross-examination it became apparent that she saw no positive role for the father in the children’s lives. She raised in cross-examination, for the first time, her concern that the father continued to take drugs during the marriage and that this presented a continuing risk to the children. There is no mention of this in her affidavit evidence, even that prepared at the time when she was fully represented. She did not mention her concern to Dr M. These concerns are plainly inconsistent with her consent to the current parenting arrangements.
I simply do not accept her explanation that she entered into not less than two consent orders relating to parenting time, because she was intimidated of the father. At both times she was represented, and certainly in the latter case she was well-represented. When given the opportunity to articulate what, precisely, the children needed to be protected from, she could provide no plausible explanation.
The mother obstinately refused to make sensible concessions in cross-examination. She refused to concede that the father was genuinely concerned about the health of the children particularly in circumstances when it was the father who was taking the lead in arranging speech therapy for the children, that is identified at paragraph 54 of Dr M’s report, and in circumstances where the mother’s own evidence indicates a strange, inexplicable disinterest on this topic. She could say not one positive thing about the father. Even the father’s financial provision for the family in the post-separation period was regarded as a mere litigation tactic by the mother, rather than something that was actually in the best interests of the children.
As I have indicated, the mother’s evidence raises real issues about her willingness to support an ongoing relationship between the children and the father. Of course, I need to be mindful of the fact that she has lived in a controlling and abusive relationship with the father, for many years. This has coloured her perspective on this issue. It will probably take more than a few months of counselling to undo the impact of years of abuse suffered by the mother. Nonetheless, what I need to consider is whether her lack of willingness to support an ongoing relationship between the father and the children is relevant within the context of the proposals put to the Court. It surely is. I fear that if she moves to [B] with the children she will do little to foster the father’s relationship with them. Again, the issue that is rapidly emerging as the main one in this case is whether it is possible to frame orders that provide the mother with the time and space to recover from years of abuse, whilst at the same time preserving the children’s relationship with their father.
When all of these matters are put together, I find that it is not in the bests interests for the children to relocate to [B] and I find that it is in their best interest that they remain going to school in their current area and that they live within a geographical distance that makes it viable for the mother to get the children to the schools that she, herself, has expressed a preference for.
I need to ask myself whether I believe that the mother will relocate to [B] and leave the children behind, in the care of their father. She was not specifically asked this. She did specifically hint at this during the proceedings. On the basis of all the evidence, I believe that she will not leave the children behind. They are her first priority and, while she was intensely emotional at certain times during the hearing, I think she has a capacity for clarity of thought and a proper focus on the best interests of the children that will make it possible for her to consider alternative places to live which makes it possible for the children to continue to enjoy the stability of their kindergarten and chosen schools, whilst, nonetheless, providing distance between the father and herself. Orders can be structured in such a way that there is no, or minimal, interaction between the parents at changeover. Any communication between the parents can be by email, or by using a communication book.
Returning now to a consideration of the father’s proposals about how much time the children spend with him, for the reasons I have articulated above, I do not believe that equal time is in the best interests of these children. The children currently spend Tuesday nights, Friday and Saturday nights with their father. That is six nights per fortnight. I would not be prepared to increase it above that. However, there is capacity to have less transitions, over a period of time, and to lengthen the duration of their stays with him. The orders will reflect this. The father’s proposal involved a block of four nights, and a block of two nights but I don’t think that is appropriate until 2012 when [Y] is expected to start school. In order to minimise transitions from one home to another, I propose to make the future contact in a six night block. By 2012 I am confident that these children will be able to cope with this. The orders I intend to make will reflect this.
Property
Balance sheet and the pool of assets
At the commencement of the hearing, I was presented by counsel for the father with the following balance sheet:-
Balance Sheet
Assets
| Item | Ownership | Husband's value | Wife's value |
| 1 | Property R (joint expert) | Joint | $1,050,000 |
| 2 | Property Z (joint expert) | Wife | $138,000 |
| 3 | Investment in E-trade | Husband | $500 |
| 4 | [C] Pty Ltd (joint expert) | Husband | -$160,000 |
| 5 | Furniture & contents | Wife | $7,000 |
| 6 | Furniture & contents | Husband | $,7000 |
| 7 | Watch | Husband | $3,000 |
| 8 | Kayak | Husband | $100 |
| 9 | Golf clubs | Husband | $500 |
| 10 | Jewellery | Wife | $10,000 |
| 11 | Subtotal | $1,056,100 |
Superannuation
| Item | Ownership | Husband's value | Wife's value |
| 12 | [omitted] | Husband | $1,673 |
| 13 | [omitted] | Wife | $13,500 |
| 14 | Subtotal | $15,173 |
Liabilities
| Item | Ownership | Husband's value | Wife's value |
| 15 | Mortgage - GE Money | Joint | $915,000 |
| 16 | Personal loan - husband's mother | Husband | $284,051 |
| 17 | ANZ Overdraft | Husband | $20,000 |
| 18 | [C] Pty Ltd (joint expert) | Husband | $99,558 |
| 19 | Credit cards | Wife | $4,500 |
| 20 | Credit cards | Husband | $12,500 |
| 21 | Personal loans | Wife | $4,000 |
| 22 | Subtotal | $1,339,609 |
Total net assets (excluding superannuation) minus $283,509
Total superannuation - $15,173
The mother did not agree with the proffered balance sheet. As I have foreshadowed before in discussing the expert evidence, even though she disagreed with the valuations of real estate referred to at items 1 and 2 of the balance sheet, I have no alternative but to accept the valuations offered by the experts.
The mother also did not agree with the negative value attributed to the company at item 4 and also cavilled with the loans owed by the father to the paternal grandmother. There is a close relationship between these two issues.
The most objective evidence about the moneys advanced by the paternal grandmother to the father, mother and/or the company is contained in her affidavit sworn 17 March 2010. In this affidavit, the paternal grandmother confirms that the $400,000 provided by her to enable the purchase of the former family home was a gift, and not a loan. It is clearly consistent with other gifts she has made to her two other children, as described in paragraph 17 of her affidavit. She asserts that all remaining moneys advanced should be characterised as a loan. Up until 22 January 2010, her evidence does not assist me to find whether the loan was for a fixed period or on demand, and whether the loan was with or without interest. I find, from her evidence, that up until 22 January 2010, the loans were interest free, were probably repayable on demand, but the father in these proceedings was entitled to have a reasonable expectation that no demands for repayment would be made in the short term. I am comfortable in making this finding based on the paternal grandmother’s own evidence about the extensive period over which she advanced the moneys and the very relaxed manner in which she dealt with these issues.
Again, in the period up until 22 January 2010, it is apparent from the grandmother’s evidence that, from her perspective, sometimes moneys were advanced to her son directly, and at other times moneys were advanced to her son’s company directly, but at all times the moneys were advanced for the benefit of the son.
Whilst all of these loans are satisfactorily evidenced by the documents produced by the paternal grandmother and annexed to her affidavit, if there was an agreement between the paternal grandmother and her son, it was purely oral.
However, on 22 January 2010, well after these proceedings had been commenced and by the time it should have been well apparent that the loans were an issue, the paternal grandmother and the father in these proceedings entered into a loan agreement which is the annexure K to the grandmother’s affidavit. It records an advance by the paternal grandmother to the father in these proceedings of $435,087.64. These advances cover the period May 2005 to December 2009. The loan is expressed to be repayable on the date being the earlier of the date of death of the father, or 30 days after written demand. The loan is expressed to be repayable by monthly instalments of $5000 each, commencing on 1 July 2010. Interest is payable on demand at the rate charged from time to time by Westpac Banking Corporation in respect of commercial overdraft facilities exceeding $100,000.
It would be readily appreciated, therefore, that the agreement of the
22 January 2010 purports to retrospectively vary, in a most dramatic fashion, the informal arrangement which existed between the paternal grandmother and her son before that date. Moneys appear to have been advanced by the grandmother for the benefit of her son since the date of this agreement. There is no evidence indicating that, notwithstanding the terms of the loan agreement, that the father has in fact made a monthly repayment of $5000.
What is significant about this loan agreement is that the grandmother characterises the loans as being advanced to her son, and as being owed to her by her son. This was confirmed in the paternal grandmother’s oral evidence. I am prepared to accept that. If it was good enough for the father and paternal grandmother to so characterise the loan, then it is good enough for me to accept in the context of these proceedings. It must follow, of course, that the company does not owe the paternal grandmother anything, and this of course requires an adjustment in the valuation of the company.
Before proceeding further it is important to record my deep scepticism about certain aspects of the agreement dated 22 January 2010. It is clearly a “convenient” document from the father’s perspective in that it records in writing details of these loan advances and suddenly creates a monthly commitment to repay the loan at $5000 in circumstances where, even on his own evidence, he is clearly unable to do so and where, before the document, there was no expectation by his mother that he would do so. I doubt whether the agreement will be enforced in accordance with its terms and, quite frankly, I doubt if the agreement will have a life outside the context of these proceedings.
Another important aspect about the grandmother’s evidence of these loans is the timing of them. Up until the date of separation in October 2008 she had advanced to her son $327,500 of which $216,500 was repaid. Hence, as at the date of separation, the amount owing was $111,000. In the post separation period, there were further advances of about $122,000. Thus, whilst I am prepared to accept item 16 in the balance sheet, a total liability to the paternal grandmother of about $284,000, the fact is that only $111,000 was owed as at the date of separation. The rest is a post separation liability. To include it in the balance sheet for section 79 purposes would not be just and equitable from the mother’s perspective. Firstly, it is apparent from the evidence that a substantial part of these post separation advances were used to fund these proceedings including legal costs, and to meet the father’s post separation personal expenditure some of which I would clearly put into the luxury and unnecessary category. For example, the paternal grandmother deposes to lending moneys to her son in 2009 the last of which (excluding direct payment of legal fees) was advanced on
20 August 2009 in the sum of $8000. Indeed, the grandmother says that on 29 September 2009 her son repaid her $4000. The father, in cross-examination, explained that he went to Europe for two weeks over the Christmas 2009 period using moneys provided by his mother. Interestingly, in the grandmother’s evidence she could recall nothing about making a payment for the benefit of her son so that he could go on an overseas trip in December 2009. Indeed, she had previously confirmed that the purpose of moneys advanced to her son was “primarily to help him through difficult times in the business, to meet payments if invoices haven’t been paid from his clients. To assist with the ongoing expense here, and also to help out in sustaining
[Ms Merrett] through this time, the money that he is paying for her.” I am strongly inclined towards the view that the father was using his own mother’s money for luxury purposes. Of course an alternate finding could be that the grandmother had advanced more moneys than she actually deposes to, or alternatively that the father’s income and financial position is substantially better than he asserts given that he can afford a two week European holiday during the course of proceedings when he presents to the Court a bleak picture of his financial circumstances. In this regard, I completely reject the submission on behalf of the father at paragraph 15 of the written submission in relation to property. The father’s legal representatives, clearly conscious of the glaring inconsistency between the evidence of the father, and his own mother, and the possible implications in the context of a non-disclosure case, submitted that the grandmother’s evidence could not be construed in the fashion referred to above. I disagree. When the grandmother’s oral evidence is seen in the context of her written evidence and is then compared to that of the father, any of the three scenarios that I have referred to above become possible scenarios. In these circumstances, I consider myself perfectly entitled to metaphorically “draw the line” at the date of separation in terms of sheeting home any responsibility to the mother for post-separation liabilities.
Moreover, I would certainly not accept the argument that the mother should directly or indirectly share in liabilities that accrue in order to fund the maintenance orders to which the father consented during the course of the proceedings. That would not be just and equitable to her, and if it was the father’s contention that he could not afford to pay the proffered maintenance without having to borrow from his mother or someone else, then he should have said so and explicitly reserved the question of characterisation of these payments to the date of the final settlement.
My findings above have certain consequences on the balance sheet. Firstly, it is necessary to go back to the evidence of Ms D and in particular to revisit appendix C to her report which sets out her calculations. Under current liabilities she includes a loan from the paternal grandmother in the sum of $172,118. That liability should not be there. Clearly, on the evidence before me, both the paternal grandmother and the father consider this to be a personal liability. Once this liability is removed from appendix C the net assets of the company become $11,719, and not the deficiency of $160,000 referred to by Ms D at paragraph 2.2 of her report, extracted above. It also means that item 4 of the draft balance sheet should read $11,719, instead of minus $160,000.
Turning now to the liabilities in the balance sheet item 16 currently reads personal loan – husband’s mother $284, 051. However, for the reasons I have articulated above, the only way to be just and equitable to the mother on the facts of this case is to include the balance of the loan at the date of separation - $111,000. This means that the total liabilities becomes $1,166,558. The consequence of this is that the net asset pool has a value of $61,261 which is represented by non-superannuation assets of $46,088.
I proceed now to consider the assessment of contribution and then any adjustment that should be made under section 75(2) of the Act.
Assessing contribution must of course occur within the context of a case where the identified asset pool is such a small one and where there seems to be more than a certain element of flexibility in the father’s financial affairs, particularly in terms of the extent to which his own mother is a financial resource for him. There can be no doubt that in terms of financial contribution, as a result of the generosity of the paternal grandmother, the father’s financial contribution is significantly greater than that of the mother. That is not to say that the mother made no financial contribution – she clearly did, having worked at times during the early stages of the marriage before the children were born. The mother has made, however, an overwhelmingly greater contribution in a non-financial sense, particularly as homemaker and parent. It is clear that the father worked exceedingly long hours both out of the home, and in his home office and was often absent at meetings and conferences both locally and interstate. Moreover, what contribution the mother did make was clearly rendered more arduous as a result of the isolation, intimidation and abuse which I find that she suffered at the hands of the father. In circumstances where the known pool of assets is so small, it is artificial to speak in terms of percentages. Nonetheless, and as artificial as this might sound, I find the contribution at the end of this relationship was equal and that the overwhelmingly greater contribution made by or on behalf of the father, was matched by the overwhelmingly greater non-financial contribution made by the mother particularly in terms of her role as homemaker and parent.
When one turns to consider whether an adjustment is called for under section 75(2), this exercise is clouded by the concerns that have been adverted to elsewhere in these reasons about nondisclosure. I am far from satisfied that I have a clear or accurate picture of the father’s true financial circumstances. His lifestyle is plainly out of sync with the financial situation he portrays before the Court. He clearly has a substantial earning capacity. His company gives him a flexibility in relation to structuring finances that is not available to the mother. Whilst he will have the benefit of an order for substantial and significant time, this will have less of an impact on his ability to work, than it will on the mother. He has a significant financial resource available to him through his generous mother. By contrast, the mother will be primarily responsible for the care of the two children and will be required by my orders to live in circumstances where she is clearly unhappy about this but where there is such obvious benefit to the children. She is an intelligent, articulate woman, but one who is still recovering from a relationship with the father that has clearly been difficult for her. She does have a capacity for part time work and, in the fullness of time, perhaps even full-time work. In my opinion, she clearly needs to continue to receive counselling. The financial challenges confronting her are substantial, but by no means insurmountable, particularly when one considers the offers made by the father to assist her into the future with spousal maintenance. Nonetheless, there can be no doubt that the considerations under section 75(2) overwhelmingly favour her.
The non-superannuation asset pool is tiny – only $46,000. In the circumstances of this case, particularly with the lingering doubts I have about disclosure, it is just and equitable that the mother receive all of this amount. I am satisfied that the father will be able to fund an order that he pay the mother the sum of $46,000 within 30 days. As I have indicated elsewhere, he obviously is confident enough to be able to advance a proposal to the Court that involves him refinancing the GE Money mortgage loan of $915,000. He obviously has available to him financial resources through the company, and his mother. I have no doubt that he has the capacity to be able to make this payment to the mother, whether or not he has to sell the office premises.
It is of importance of course to now reconsider the father’s proposal for spouse maintenance. That proposal was made on the basis that he make no cash payment to the mother by way of alteration of property interest under section 79. Does the fact that I have ordered him to pay her $46,000 change anything, in the circumstances of this case? The answer is a clear no. The spouse maintenance, and the section 79 order, serve different purposes even though there is clearly a substantial section 75(2) component to the section 79 order. The litmus test really is this, on the facts of this case: what difference would it make to the mother’s financial circumstances to have a lump sum of $46,000? The answer is probably little. It is not enough for her to reaccommodate herself in her own property. She will be dependent on rental accommodation into the indefinite future. The present case is a classic case demonstrating the different roles that sections 79 and sections 74 of the Family Law Act play. If the father were not to pay spouse maintenance, on the evidence that has advanced in the father’s own case, it would be almost impossible for the mother to live within an area that would make a substantial and significant parenting arrangement feasible, in circumstances where both parents have a desire to educate their children at certain schools. I am satisfied that, on the evidence before me, the mother needs spouse maintenance and that her need would not change, even if she were able to return to part time employment. I am satisfied about the father’s capacity to make the payments that he proffers. Once [Y] commences primary school I can see no reason why the mother should not be able to return to the part time work force. Her income will then be supplemented by the $250 per week maintenance offered by the father. The father offers, and the mother accepts his offer, to pay the children’s school fees and associated costs including books, stationary, uniforms, shoes, sporting equipment, sports uniforms and extracurricular activities as agreed. In these circumstances the order is appropriate.
The form of orders for maintenance suggested by the father involved him making payments towards the mother’s rental, such money to be paid directly to the landlord or managing agent. I do not see the need for this. From the mother’s perspective, it is unquestioningly an attempt to further control her life by controlling her finances. At various points during the father’s case there was a hint that he did not trust the mother’s management of finances, in part because of gambling. There is no evidence before the Court that would lead me to have a concern about the mother having an uncontrollable gambling habit, or being irresponsible in terms of management of finances. One may well ask how on earth the mother could have been irresponsible with money, or gambled, when her access to funds were so closely controlled during the period of this marriage?
As I have foreshadowed I am not prepared to make the payment of maintenance conditional on the mother not commencing cohabitation with another person. In the context of this case, that is another attempt to control. The fact is that both the mother and father may seek to vary these orders in future, based on changed circumstances, or the other matters referred to in section 83 of the Family Law Act. That is a problem inherent in all spouse maintenance orders. In this case the finalities sought to be achieved in an aspirational sense by section 81 is not possible.
I certify that the preceding one hundred and thirteen (113) paragraphs are a true copy of the reasons for judgment of Altobelli FM
Associate:
Date: 11 November 2010
Schedule 1
Proposed Minutes of Order sought by Husband
Parenting
That the parties have equal shared parental responsibility for the
2 children of the marriage, [X], born [in] 2005 and [Y], born [in] 2006 ("the children").That the children live with the husband at the following times:
(a)2010 -
(i)every alternate week from 3:00pm Thursday until 9:00am Monday (Tuesday in the event of a long weekend), the husband to collect the children from the wife's residence on a Thursday and deliver the children to kindergarten on Monday (or Tuesday).
(ii)every other week from 3:00pm Thursday until 9:00am Saturday, the husband to collect and return the children from and to the wife's residence.
(iii)the first half of the school holidays.
(iv)9:00am to 6:00pm Fathers Day the husband to collect and return the children from and to the wife's residence.
(v)Such further time or variation of time as agreed, including time as agreed on each of the children's birthdays and the husband's birthday.
(b)2011 -
(i)every alternate week from 2:30pm Thursday until 9:00am Monday (Tuesday in the event of a long weekend) the husband to collect [Y] from the wife's residence at 2:30pm and [X] from school at 3:00pm and return the children to school on Monday (or Tuesday).
(ii)every other week from 2:30pm Thursday until 9:00am Saturday, the husband to collect [Y] from the wife's residence at 2:30pm and [X] from school at 3:00pm and return the children to the wife's residence on Saturday.
(iii)the second half of the school holidays.
(iv)9:00am to 6:00pm Fathers Day the husband to collect and return the children from and to the wife's residence.
(v)such further time or variation of time as agreed, including agreed time on each of the children's birthdays and on the husband's birthday.
(c)2012 onwards -
(i)every alternate week from 3:00pm Wednesday to 9:00am Monday (Tuesday in the event of a long weekend) the husband to collect and return the children from and to kindergarten/school.
(ii)every other week from 3:00pm Wednesday to 9:00am Friday, the husband to collect and deliver the children from and to school.
(iii)the first half of the school holidays and every alternate year thereafter and the second half of the school holidays every other year.
(iv)9:00am to 6:00pm Fathers Day each year, the husband to collect and return the children from and to the wife's residence.
(v)Such further time or variation of time as agreed, including agreed time on each of the children's birthdays and on the husband's birthday.
That the children live with the wife at all other times.
That the time that the children live with the husband as set out in paragraph 2, be suspended on Mothers Day each year and during such times as the children live with the wife during school holidays.
That both parties be permitted to attend all school and extra curricular activities in which the children, or either of them, may be involved, albeit that these activities take place in the other party's time with the children.
That each party have telephone communication with the children each day when the children are with the other party, prior to 9:00 am and between 6:00 pm and 7:30 pm.
That each party be restrained from changing the children's residence more than 30 minutes driving distance from [J] Kindergarten without the prior written consent of the other party.
That if either party changes his/her residence or his/her telephone number (including landline and mobile) that he/she provide the other party, with no less than 30 days prior written notice of the proposed change of address and with written notice of the new telephone number, immediately after same has been changed.
That if either party takes the children outside New South Wales that he/she provide the other with the address and telephone numbers of where the children will be staying.
That each party immediately notify the other party if the children or either of them is seriously ill or requires any medical procedures or operations.
That each party authorise the children's doctors, dentists and any other professionals with whom the children may consult from time to time, to provide to the other party any information or reports that he/she may require.
That each party authorise the children's kindergarten/school to provide to the other party, all information relating to the children, including copies of the children's school reports, school bulletins and notification of parent/teacher functions and all school activities and extra curricular activities in which the children or either of them may be involved.
That the parties do all acts and things and sign all necessary documents in order to cause [Y] to increase his days at [J] Kindergarten to 3 days per week commencing January 2011.
That within 14 days of the date of orders that the wife do all acts and things and sign all necessary documents in order to enrol the children at [A] School, [B] School, [C] School and [D] School.
That until such time as the children obtain a place at one of the private schools referred to in paragraph 14 that the children attend [D] School.
That the Husband pay or cause to be paid the children's school fees and associated costs, including but not limited to books and stationery, uniforms and shoes, sporting equipment and sports uniforms and extra-curricular activities as agreed.
That the parties use a communication book to communicate about issues relating to the children.
That the parties forthwith do all acts and things and sign all necessary documents in order to attend a post separation parenting program as soon as practicable with Relationships Australia or such similar organisation with a focus on cooperation parenting.
That each party be restrained from denigrating the other party in the presence of or in the hearing of the children.
That each party be restrained from discussing these proceedings in the presence of or in the hearing of the children.
That pending further order that the husband's lawyers retain the children's passports and that they not be released to either party without the prior written consent of the other party.
Property
That the wife do all acts and things and sign all necessary documents in order to transfer to the husband her right, title and interest in the properties situate and known as Property R ("Property R) and Property Z ("Property Z").
That the parties do all acts and things and sign all necessary documents in order to discharge the mortgages secured against Property R and Property Z ("the mortgages") and substitute fresh mortgages in the husband's name at the husband's cost and that the husband indemnify the wife in relation to the mortgages.
That except as provided above, each party retain to the exclusion of the other, all other property registered in his/her name or in his/her current possession or control, including each of their superannuation entitlements.
That if either party refuses or neglects to sign any document necessary to implement these orders, that a Registrar of the Federal Magistrates Court be appointed to sign the necessary document in lieu of the defaulting party and the defaulting party shall pay the costs of the other party on a lawyer/client basis.
Spouse Maintenance
That until such time as [Y] commences primary school that the husband pay or cause to be paid $450 per week towards the wife's rent, the money to be paid directly to the landlord or the managing agent of the wife's rented premises or as otherwise agreed in writing between the parties.
That at such time as [Y] commences primary school until the earlier of the following, that the husband pay or cause to be paid one half of the wife's rent up to a total amount of $250 per week, the money to be paid directly to the landlord or the managing agent of the wife's rented premises or as otherwise agreed in writing between the parties:
(a)the wife obtains full-time employment;
(b)the children are no longer living with the wife;
(c)[Y] completes his secondary education.
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3
1