MERRIGAN & Conlon

[2014] FamCA 495

FAMILY COURT OF AUSTRALIA

MERRIGAN & Conlon [2014] FamCA 495

FAMILY LAW – PROPERTY SETTLEMENT IN RELATION TO MARRIAGE –Where the parties lived under the one roof for approximately six years and 10 months – Where the parties have two children – Where the applicant husband seeks an order that the wife pay him approximately $280,000 – Where the respondent wife seeks that no orders for settlement of property are made – Where both parties made significant contributions throughout the marriage – Where the contributions of the wife were found to exceed those of the husband, being 55 per cent compared to 45 per cent by the husband – Where the care of the children will in future mainly fall to the wife – Where an adjustment of 5 per cent to the wife would be justified - Where the application of s 79(4) to the facts of the case would warrant a payment to the wife – Where the wife does not seek such an order – Where it would be just and equitable to make no order for settlement of property – Where order made for the husband to discharge any arrears of his child support liability – Where order made for the husband to pay the expert accountant’s costs.

Evidence Act 1995 (Cth) s 50

Family Law Act 1975 (Cth) s 79, 75

Bevan & Bevan [2013] FamCAFC 116
Biltoft and Biltoft (1995) FLC 92-614
Bradley and Bradley [2013] FamCAFC 116
Cerini & Cerini [1998] FamCA 143
Chapman & Chapman [2014] FamCAFC 91
Chorn v Hopkins (2004) FLC 93-204
Hickey & Hickey & Attorney-General for the Commonwealth of Australia (2003) FLC 93-143
In the Marriage of Lenehan (1987) FLC 91-814
In the Marriage of Norbis (1986) FLC 91-712
In the Marriage of Omacini (2005) FLC 93-218
In the Marriage of Shewring (1987) 92 Fam LR 385
In the Marriage of Zyk (1995) FLC 92-644
Norman & Norman [2010] FamCAFC 66
Stanford v Stanford [2012] HCA 52
Townsend & Townsend (1995) FLC 92-569

APPLICANT: Mr Merrigan

RESPONDENT: Ms Conlon

FILE NUMBER: SYC 8096 of 2010

DATE DELIVERED: 10 July 2014

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Loughnan J

HEARING DATE:

11, 12 & 13 February 2014

Last written submissions –
2 June 2014

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Jackson

SOLICITOR FOR THE APPLICANT: Smallwoods Lawyers

COUNSEL FOR THE RESPONDENT: Ms Christie

SOLICITOR FOR THE RESPONDENT: XX Lawyers Pty Ltd

Orders

1. That there be no order under s 79 Family Law Act 1975 (Cth).

2. That within one month from the date of these orders the husband pay $33,750 to L Associates Limited.

3. That within one month from the date of these orders, subject to any written agreement between the parties to the contrary, the husband discharge any arrears of his child support liability.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Merrigan & Conlan has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 8096 of 2010

Mr Merrigan

Applicant

And

Ms Conlon

Respondent

REASONS FOR JUDGMENT

Introduction

1. These are proceedings in relation to property settlement where the applicant husband seeks a property settlement in the form of a payment of about $280,000. The respondent wife seeks that there be no alteration of the parties’ interests in property.

2. The wife also seeks to enforce a child support debt of the order of $14,000 against the husband.

3. The parties’ relationship involved them cohabiting for six years and 10 months.

Applications

1. The husband sought orders as set out in the Written Submissions of his counsel dated 16 April 2014. By way of substantive orders, he sought:

   1.that the wife pay him $279,941 within 2 months and that in default the [Suburb N] property be sold and that he be paid that sum plus interest;

   2.that the husband pay the Child Support Agency $13,000 within 2 months; and

   3.that the parties otherwise retain what they have and what they owe.

2. The wife ultimately sought that no order as to property settlement be made. The orders sought by the wife in accordance with her Further Amended Response filed 3 September 2013 included the following:

   4.that the husband shall pay the Child Support Agency an amount representing the sum of all amounts due to the Child Support Agency as at the date of the final orders, within 14 days;

   …

   6.that the husband pay [L] Associates Limited all amounts due to them in connection with their valuation of [BV Pty Ltd] within 28 days;

   7.that the husband pay the other legal costs and disbursements of the wife in respect of this matter in such sum as may be agreed or assessed within 28 days of such agreement or assessment; and

Documents Read

1. The parties relied on the following documents:

   Documents relied on by the husband:

   ·Affidavit of Husband filed 2 April 2013;

   ·Affidavit of Husband filed 11 February 2014; and

   ·Financial Statement of Husband filed 10 February 2014.

   Documents relied on by the wife:

   ·Further Amended Response filed 3 September 2013;

   ·Financial Statement filed 5 February 2014;

   ·Affidavit of the Wife filed 14 January 2014;

   ·Affidavit of Mr C filed 14 January 2014;

   ·Affidavit of Ms S filed 14 January 2014; and

   ·Affidavit of Ms A sworn 11 April 2013.

The Hearing

1. The case was listed for final hearing over three days commencing on 11 February 2014. The trial concluded on 13 February 2014.

2. Written submissions on behalf of the husband were belatedly provided to the Court on 16 April 2014. On 2 June 2014 a document titled “Submissions in Reply” was received from the wife. In the latter document the wife effectively proposed that either both sets of submissions be ignored or both be taken into account. Both have been taken into account.

3. On that basis, on 2 June 2014 judgment was reserved.

SHORT HISTORY

1. The husband was born in Ireland in 1958 and as at the date of the hearing he was 55 years of age. The wife was born in England in 1960 and as at the date of the hearing she was 53 years of age. The parties commenced cohabitation around September 2002. According to the wife they married on a date in October 2002. According to the husband they married 11 days earlier than that date. The parties separated in mid-August 2009. The parties are not divorced.

CHILDREN

1. There are two children of the marriage, both of whom currently reside with the wife. The child D was born in 2003 and as at the date of the hearing was 10 years of age. The child E was born in 2005 and as at the date of the hearing was eight years of age. The wife also has two children from a previous marriage, Y who was born in 1979 and T who was born in 1982.

BACKGROUND FACTS

1. In 1982 the husband moved to Australia.

2. In 1994 the husband’s business BV Pty Limited (previously BR Pty Limited) was established. The husband worked full-time as a skilled tradesman.  The husband was the sole director and shareholder of that company.

3. In 2001 the husband moved into the wife’s home at C Street, Suburb N (“the former matrimonial home”). He deposed that around that time he built a deck and installed two doors where there were previously windows. He undertook all the work and paid for materials from his company’s business account.

4. The parties commenced cohabitation in September or October 2002.

5. The parties were married in October 2002. 

6. At that time the wife owned:

   a)C Street, Suburb N. It then had a value of $675,000 and there was a mortgage on the property of $167,852.  

   b)A payment from FF Firm in the amount of $10,576;

   c)Cash on hand in XX Lawyers totalling $812;

   d)Work in progress in XX  Lawyers also totalling $812; and

   e)Superannuation valued at $40,372.

7. The wife had a credit card debt and pursuant to an arrangement with her first husband, an obligation to the children of her first marriage.

8. The husband owned:

   a)An unencumbered property at O Street, Suburb H (“the H property”), valued at the time at around $280,000. The wife says that until January 2010 the H property was rented out and after payment of outgoings in respect of that property the rental was applied by the husband towards the day to day living expenses and other expenses associated with the family and towards the costs associated with the former matrimonial home. The rent the husband received was $250 per week in 2003, increasing up to $350 per week in 2009. The property never vacant for more than one month at a time;

   b)The beneficial interest in an unencumbered property in Ireland (“the Irish property”);

   c)Savings with the Bank of Ireland in the sum of about $41,000;

   d)Cash in hand of approximately $20,000. The husband says he gave the wife the $20,000 cash he had around that time and is aware that she put this money into a bank account;

   e)A Ford motor vehicle;

   f)Plant and equipment for his business BV Pty Limited (previously BR Pty Limited);

   g)IAG shares valued at the time to be approximately $1,200; and

   h)Superannuation of approximately $15,755.72.

9. In 2002 a prestige motor vehicle was purchased by the parties for $63,000. The wife received a $10,500 trade-in for in her Honda motor vehicle. It is likely that the balance of the purchase price was borrowed and that the repayments on the loan were made by BV Pty Limited[1].

   [1] See paragraph 21 of the husband’s affidavit filed 2 April 2013 and page 4 of the wife’s Financial Questionnaire at Exhibit 9

10. In 2002 the husband allowed the H property to be used as security for borrowings of $190,000 to carry out significant renovations and alterations to the former matrimonial home which, according to the husband were as follows:

    a)New room in the former matrimonial home, being a new bedroom for a baby;

    b)Improvements to the south west veranda, including the installation of windows and doors;

    c)Installation of windows and doors through the two bedrooms; and

    d)Air conditioning for the house, construction of two toilets, and installation of wardrobes in the bedrooms.

11. The husband deposed that he personally undertook the work with the exception of engaging a relative for a few days to do carpentry and he contracted out the electrical work. All the materials were bought through the husband’s company.

12. In 2003, the child D was born.

13. In 2005, the child E was born.

14. In 2005 the husband assisted in drafting plans for major renovations to the former matrimonial home, including the construction of an additional first floor to the existing dwelling, as well as changes to the ground floor. The wife deposed that she paid for all work and associated disbursements relating to the renovations. Neither of them was successfully challenged on that evidence.

15. The husband deposed that between September and December 2006 he attended to major renovations of the former matrimonial home including: the addition of stairs from the deck to first floor, the conversion of two bedrooms into office/study rooms, conversion of a bathroom to study, the addition of a large deck, a master bedroom, a new sitting room, built-in wardrobes and the installation of a spa bath in the master bedroom. He was not challenged about that evidence in cross-examination.

16. The husband deposed that in addition to the $190,000 obtained on the mortgage of the H property, further funds amounting to approximately $50,000 were used from the BV Pty Limited company account towards the construction costs and costs of materials for the renovations and improvements on the former matrimonial home in 2006. He was not challenged about that evidence in cross-examination.

17. The wife deposed that in 2007 she undertook legal work to have land owned by the husband in Ireland formally transferred to him. The wife was challenged about that evidence and produced correspondence drawn by her in relation to the property. The wife deposed that in 2008 she drafted a lease in respect of the husband’s property in Ireland. I am satisfied that the wife performed that work. It transpired that the relevant document was a license but no harm is done by the misdescription.

18. The husband deposed that in 2009, he undertook further renovations to the former matrimonial home to repair the front timber stairs at a cost of $2,000, paid from the husband’s company account. The husband said the doors and windows cost about $15,000, which was paid from his company account. The husband says he employed three carpenters and paid a total of $19,500 to them. There was no challenge to that evidence.

19. The wife deposed that from approximately 2008 to 2009 she performed legal and administrative work for the husband’s companies. The parties do not agree about the extent of the work. The parties had the assistance of an administrative assistant who also helped with domestic work. Suffice it to say that I am satisfied that the wife performed legal and administrative work for BV Pty Limited.

20. On or about 16 August 2009 the parties separated. Initially the wife and children left the former matrimonial home. After some weeks the wife asked the husband to vacate the property and he did. The husband said he thereafter stayed in hotels and sometimes slept in his car. He said he relied on the BV Pty Limited overdraft and on his credit card to pay for his accommodation and meals.

21. The wife gave evidence that thereafter, on some occasions she would find the husband uninvited, sleeping on a couch in the former matrimonial home. Otherwise the parties thereafter lived in separate accommodation.

22. Shortly after separation the wife withdrew a total of $20,000 from the BV Pty Limited account which she deposited into the mortgage account secured over the Hd property.

23. In 2009 the former matrimonial home was subject to a mortgage (being a line of credit) to the Commonwealth Bank of Australia standing at $184,275.41.

24. On 28 September 2009 the wife moved her work premises from her home office to an office in the city. The wife deposed she made those arrangements due to her fear of domestic violence by the husband. She also gave evidence that it provided her with full time receptionist and mail services, she was able to meet clients there and there were other benefits in having a city office.

25. In late November 2009 the wife met her new partner, Mr Z.

26. In 2010 the wife signed transfer papers to allow the registration of the prestige vehicle to be changed into the husband’s name.

27. In January 2010 the husband sold the H property for $353,000 and the husband received the net proceeds of $159,176. $132,181.53 was initially deposited into his mortgage equity account with the ANZ bank …501. He subsequently withdrew $100,000 from that account and deposited the money into a term deposit. Of that amount $80,000 was kept on term deposit in his name to secure the company overdraft.

28. The husband deposed that he placed $30,000 from the proceeds of sale of the H property into the BV Pty Limited overdraft account in March 2010.

29. On 10 August 2010, $22,975 was withdrawn from the term deposit and deposited into the BV Pty Limited overdraft account.

30. On 29 March 2011 the wife delivered the prestige vehicle to the husband. It is the wife’s evidence that she had the car serviced and valued at about $11,500. The husband alleged that at the time of delivery to him, the vehicle had several defects. The vehicle subsequently sat in a local car park for nearly one year. That included a period when the husband was disqualified from driving. The husband later sold the car for $2,000.

31. In 2011 the husband took up accommodation at his current address in Suburb N, about 150 metres from the former matrimonial home.

32. The husband deposed that in May 2011 he became aware that the wife had increased the borrowings on the former matrimonial home to $300,000. The husband subsequently filed an Application in a Case seeking orders restraining the wife from further encumbering the property.

33. On 14 November 2011 Justice Johnston made an order to the effect that the wife was not to further encumber the property.

34. In March 2012 the husband was stood down as a consequence of a work accident for five weeks. He was later cleared of any alleged disciplinary issue.

35. In August 2012 the husband had no work for about a month.

36. In September 2012 the wife’s partner, Mr Z, moved into the former matrimonial home and he remained there as at the date of the hearing.

37. On 17 December 2012 Interim Orders were made in relation to parenting issues.

38. On 12 March 2013 the parties attended Family Consultant, Ms B.

39. On 12 March 2013 Child Support arrears was noted by the Child Support Agency to be $11,094.

40. On 22 April 2013 consent orders were made including an order that L Associates Limited make reports of: any expenditures that appear to not relate to proper business purposes or expenses of BV Pty Limited and their estimate of interest expenses; tax liabilities and the value of BV Pty Limited. The orders provided that L Associates be instructed to forensically examine the accounts and records of BV Pty Limited and that in the event that any financial accounts and associated tax returns supplied by the husband are in the opinion of the Court substantially incorrect, misleading or fraudulent, that the costs of all work by L Associates will be solely paid for by the husband. The husband and his solicitors were restrained from contacting L Associates except for the purposes of the provision of information with the written approval of the wife. The agreed value of the former matrimonial home was recorded at that time, as $950,000;

41. On 7 May 2013 final Parenting Orders were made whereby the children were to live with the wife and spend limited time with the husband.

CREDIT

The Evidence Of The Witnesses

1. There are issues that fall to be determined solely by reference to the uncorroborated testimony of the parties. It is therefore necessary to made credit findings. As could be expected, each of the parties apparently gave evidence from their own perspective and much of the evidentiary dispute could be described as matters of perception.

2. The husband was a poor witness. His memory is poor and on several issues he gave one answer and either immediately or soon thereafter contradicted himself. By conceding that he might have done certain things, the husband conceded much of the wife’s case about him communicating with her in abusive terms and harassing her. He set out to minimise aspects of his past behaviour, his drinking (saying something to the effect that low range PCA would not be proscribed in other countries) and abusive communication (in effect, claiming the wife did it too).

3. The wife is a legal professional. She had difficulty in responding to cross-examination as a witness rather than an advocate and was somewhat combative during cross-examination. In my view she was justified in being frustrated about the focus during cross-examination on issues of discovery and disclosure that should have been, and in many cases were, dealt with prior to the trial. Some challenges to the wife in cross-examination were unfair. She was challenged about an allegedly undisclosed credit card account only to have it revealed that it was an account of the husband. Quite properly, the husband’s counsel apologised for that challenge. The wife was pressed in relation to sending voluminous emails to the husband’s solicitor in order to run up costs, only to reveal that she sent fewer emails (albeit over 700) than she received from the husband’s lawyers.

4. Although findings of fact on disputed issues were determined issue by issue, as a general proposition the wife was a more reliable witness than the husband.

The Law

The Approach In Proceedings Under Section 79

1. In the context of these proceedings s 79 of the Family Law Act 1975 (Cth) (“the Act”) relevantly provides:

   FAMILY LAW ACT 1975 - SECTION 79

   Alteration of property interests

   (1)In property settlement proceedings, the court may make such order as it considers appropriate:

   (a)  in the case of proceedings with respect to the property of the parties to the marriage or either of them - altering the interests of the parties to the marriage in the property; or

   ….

   including:

   (c)an order for a settlement of property in substitution for any interest in the property; and

   (d)  an order requiring:

   (i)either or both of the parties to the marriage; …

   ….

   to make, for the benefit of either or both of the parties to the marriage or a child of the marriage, such settlement or transfer of property as the court determines.

   ….

   (2)  The court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.

   (4)  In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:

   (a)  the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and

   (b)  the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and

   (c)  the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and

   (d)  the effect of any proposed order upon the earning capacity of either party to the marriage; and

   (e)  the matters referred to in subsection 75(2) so far as they are relevant; and

   (f)  any other order made under this Act affecting a party to the marriage or a child of the marriage; and

   (g)  any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.

1. In Stanford v Stanford [2012] HCA 52 (“Stanford”) the joint judgment of French CJ, Hayne, Heydon, Kiefel and Bell JJ discusses the operation of s 79 of the Act. Importantly, it was held that:

   ·The requirements of s 79(2) and s 79(4) should not be conflated;

   ·In every case in which a property settlement order under s 79 is sought, it is necessary to satisfy the court that, in all the circumstances, it is just and equitable to make the order. It should not be assumed that an order should be made;

   ·Despite the preamble to s 79(4) it is not necessary to take the s 79(4) considerations into account when considering whether the making of an order would in all the circumstances, be just and equitable;

   ·There is no limit to the matters that could be taken into account in considering whether it would be just and equitable to make an order at all but that requirement will be readily satisfied in most cases. However, the High Court identified as a fundamental proposition that “it is necessary to begin consideration of whether it is just and equitable to make a property settlement order by identifying, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in the property.”

   ·“In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of a choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the ending of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying s 79(4).”

2. For nearly 40 years there have been attempts to impose tests, principles and guidelines on the application of key provisions of the Act. Given the discretion exercised in relation to many of those provisions is not exclusively confined it is understandable that a desire for predictability and the fear of capricious decision-making have led to those attempts. The application of s 79 has been the subject of extensive judicial interpretation and comment. In Hickey & Hickey & Attorney-General for the Commonwealth of Australia (2003) FLC 93-143 (“Hickey”) the Full Court said:

   39.The case law reveals that there is a preferred approach to the determination of an application brought pursuant to the provisions of s.79. That approach involves four inter-related steps. Firstly, the Court should make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing. Secondly, the Court should identify and assess the contributions of the parties within the meaning of ss.79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties. Thirdly, the Court should identify and assess the relevant matters referred to in ss.79(4)(d), (e), (f) and (g), (“the other factors”) including, because of s.79(4)(e), the matters referred to in s.75(2) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties established at step two. Fourthly, the Court should consider the effect of those findings and determination and resolve what order is just and equitable in all the circumstances of the case: Lee Steere and Lee Steere (1985) FLC 91-626; Ferraro and Ferraro (1993) FLC 92-335; Davut and Raif (1994) FLC 92-503; Prpic and Prpic (1995) FLC 92-574; Clauson and Clauson (1995) FLC 92-595; Townsend and Townsend (1995) FLC 92-569; Biltoft and Biltoft (1995) FLC 92-614; McLay and McLay (1996) FLC 92-667; JEJ and DDF (2001) FLC 93-075 and Phillips and Phillips (2002) FLC 93-104.

3. Notwithstanding the guidance provided in Hickey, the Full Court has regularly noted that the “three-step” or “four-step” approach is not mandated but merely illuminates the path to the ultimate result.[2] There was further advice about the process of s 79 decision making in Bevan & Bevan [2013] FamCAFC 116 (“Bevan”). There the Full Court discussed the implications of the decision of the High Court in Stanford, and noted that a stepped process to the exercise of s 79 was used at first instance in those proceedings and passed without comment by the High Court, favourable or unfavourable. However, the Full Court cautioned:

   72.It follows that judges would be well advised to avoid what we consider to be arid discussion of the “stage in the process” at which “adjustments” are permissible.  Such discussion tends to elevate the four step process to the status of a statutory edict, when in fact it is no more than a shorthand distillation of the words of a statute which has but one ultimate requirement, namely not to make an order unless it is just and equitable to do so. 

   [2] Norman & Norman [2010] FamCAFC 66 at [60]; Bevan & Bevan [2013] FamCAFC 116.

4. Unlike the unusual factual background of Stanford and Bevan, in Hickey the issue of whether any order should be made did not arise. However, that issue is raised in the proceedings before me. Here, it is not agreed that it is necessary to change the parties’ property interests. The wife seeks no change but not because of circumstances such as applied in Stanford or Bevan. Here there is a more practical argument. It is the wife’s case that the application of s 79(4) does not necessitate a change of property interests. In that regard it is agreed that there should be no change in the ownership of real estate. An Irish property is in the husband’s name and the Suburb N property is in the name of the wife and neither party seeks a change to the ownership of those properties.

5. Although it is argued on behalf of the wife that it would not be just and equitable to make any order, learned counsel for the wife agreed with the proposition that in order to come to that decision in this case I would need to apply subsection 79(4) considerations to the circumstances of the case. Given the apparently mandatory introductory wording of s 79(4) care is needed in extending to all factual circumstances the decision by the High Court in Stanford that it is not necessary to take the s 79(4) considerations into account when considering whether the making of an order would in all the circumstances, be just and equitable.

6. I will address the following matters:

   a)Make findings as to the identity and value of the property, liabilities and financial resources of the parties at the date of the hearing;

   b)Identify and assess the contributions of the parties within the meaning of ss 79(4)(a), (b) and (c) and determine the contribution based entitlements of the parties expressed as a percentage of the net value of the property of the parties;

   c)Identify and assess the relevant matters referred to in ss 79(4)(d), (e), (f) and (g) so far as they are relevant and determine the adjustment (if any) that should be made to the contribution based entitlements of the parties; and

   d)Consider the effect of those findings and determinations and determine whether it would be just and equitable to make an order, in all the circumstances of the case and if so, what that order should be.

The property of the parties

1. The husband and wife settled a joint balance sheet[3] as follows:

   [3] Exhibit 16

Assets

Owner		Description	Wife’s value	Husband’s value
1	W	C Street, Suburb N	$980,000	$980,000
2	H	Land in Ireland (€173,250 as per orders 2 December 2013 w exchange rate as at 12.2.14)	$261,853	$261,853
3	H	IAG shares	$700	$700
4	H	Shares in MV Pty Ltd	$0	$0
5	H	Furniture at U Street, Suburb N or otherwise received by the Applicant	1,000	500
6	W	CBA Complete Access account number …814 as at 30 Jan 2014	$875	$875
7	W	CBA Complete Access account number …145 as at 30 Jan 2014	$394	$394
8	W	Jewellery	$2,300	$2,300
9	W	XX Lawyers Pty Ltd (XX) $5,000	$4,233	$5,000
10	W	Furniture and effects at C Street, Suburb N	$2,000	$2,000
10a	…	Dinghy	$600	$600
Total		$1,253,955.00	$1,254,222.00

Addbacks

Owner		Description	Wife’s value	Husband’s value
11	H	Proceeds of sale of H property received by the Applicant	$159,176.53	$0
12	H	Legal costs paid by husband for family law either by the husband or BV Pty Ltd *AVO/breach/drink drive charges ** Family Law and associated matters + TBA	$17,824.50* $38,389.06** $56,213.56 +TBA	$0
13	W	Legal costs paid by wife for family law	$17,480.67	$0

Liabilities

Owner		Description	Wife’s value	Husband’s value
14	H	ATO debt related to BV Pty Ltd	Not counted	$40,000
	W	ATO debt related to XX	Not counted	$0
15	H	Director related entity loans from MV Pty Ltd	Not counted	$3,622
	W	Director related entity loans from XX	Not counted	$13,382
16	H	Liability to pay AMEX	Nil	$15,000
17	H	Legal costs and disbursements outstanding to 15/3/2013	Not counted	$134,780
18	H	Debt due to the child support agency	Not counted	$14,902
19	W	CBA Home loan …009 Mtg C Street as at 30 Jan 2014	$396,377	$396,377
20	W	AMEX Account (Incl. $11,550 barristers fees paid and included below in legal costs of the wife)	$11,569	$11,569
21	W	ANZ Mastercard as at 30 Jan 2014	$1,878	$14,988
22	W	Commonwealth Bank Mastercard as at 30 Jan 2014	$8,323
23	W	28 Degree Mastercard as at 30 Jan 2014	$4,785
24	W	Personal Tax liability to ATO actual	$11,767	$11,767
25	W	Contingent tax liability to ATO for y/e 30 June 2013	$3,500	$3,500
26	W	J Builder $600; school fees $734.50; Ms I CA $650.00; Council Rates $490	$2,474	$2,474
Total		$440,673.00	$662,361.00

Superannuation

Owner		Description	Wife’s value	Husband’s value
27	H	Industry super fund as at 2/12/2012	$55,835
28	W	Plan 1 accountant’s super at 3 May 2013	$59,085
Total		$114,920.00

1. As to the issues about the balance sheet:

Item 4

1. Ms P valued BV Pty Ltd at $14,773. The husband commenced the process to deregister BV Pty Ltd and that process was stalled at the time of the hearing. MV Pty Ltd was established by the husband as the new vehicle for his work. The wife is aggrieved and perhaps, justifiably so, about that sequence of events. Nevertheless, it is not submitted that MV Pty Ltd has any value.

Item 5

1. There is no formal valuation evidence in respect of the husband’s furniture. The husband proposed a value of $500. The wife is aggrieved because the husband had assessed his furniture to have a value of $1,000 until very recently and then changed his assessment. There is either an agreed figure or evidence on the basis of which a finding can be made – such as a formal valuation; a recent purchase price etc. I indicated to the parties that unless there was an agreed figure I would include the furniture at no identified value. I understood the wife’s counsel to concede the figure of $500.

Item 9

1. Ultimately, there was no controversy about this item and it was agreed at $5,000.

Items 11, 12 & 13

1. The parties do not agree about the approach to add-backs.

2. The wife seeks that some amounts used by the husband be added back to the list of assets. The husband opposes that course.

3. In other cases the Court has found that assets are included in the pool of relevant assets and liabilities even though they no longer exist. The same logic has been applied to the exclusion from the relevant list of liabilities, debts that do exist at the date of the hearing. In the Marriage of Omacini (2005) FLC 93-218, 33 Fam LR 134 (“Omacini”) the Full Court noted:

   30.To date, three clear categories of cases have emerged where the Court has determined that it is appropriate to notionally add back to the pool of assets, that is, assets that no longer exist. They are:

   (a)Where the parties have expended money on legal fees. In DJM and JLM (1998) FLC 92-816 the Full Court said at 85,262:

   “11.6  For reasons set out in Farnell, s 117 provides that each party to proceedings under the Family Law Act shall bear their own costs unless the Court otherwise orders. Failing to add back monies expended by parties on costs frequently has the effect of defeating the policy of s 117 by permitting the pool of available assets for distribution between the parties to be diminished by any monies that either of the parties have managed to spend on their costs up to the date of trial. We are of the view that the normal approach ought be to add costs already paid back into the pool. Whilst there may be cases where that approach is inappropriate, the reasons why it is not taken ought normally be spelt out.”

   (b)Where there has been a premature distribution of matrimonial assets. In Townsend and Townsend (1995) FLC 92-569 Nicholson CJ as he then was with whom Fogarty and Jordan JJ agreed, said at 81,654:

   “In my view, what occurred in this case, as I said during the course of argument was, in fact, a premature distribution of a proportion of the matrimonial assets. What the husband did was to distribute to himself an asset in which the wife had a legitimate interest. In such circumstances I consider that it would be unjust in the extreme to simply treat such conduct by the husband as a matter to which regard should be had under section 75(2). It seems to me that the husband has had the benefit of that money. Had he retained, for example, the taxi licence instead of selling it, that would have been brought into account as an item of property which would have been dealt with in the same way as the remaining items of property in this case. Accordingly, I am of the view that the correct way in which to deal with the husband’s receipt of those moneys is to bring them into the pool of assets on a notional basis and make a distribution accordingly.”

   (c)In the circumstances outlined 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.

   Conduct of the kind referred to in para. (a) and (b) above having economic consequences is clearly in my view relevant under sec.75(2)(o) to applications for settlement of property instituted under the provisions of sec.79.”

   31.As the Full Court said in Browne and Green (1999) FLC 92-873 at 86,360:

   “44.We agree with her Honour that the principles stated by Baker J in Kowaliw certainly do not constitute any form of fixed code. They are no more than guidelines for use in the exercise of the discretionary jurisdiction conferred by s 79 of the Family Law Act 1975. Nevertheless, they have over the considerable period of time since they were enunciated, become a well accepted guideline in this jurisdiction – a guideline the use of which assists in the achievement of the important goal of consistency within the jurisdiction.”

4. A problem of the add-back approach is that by the inclusion in the balance sheet of provision for assets that no longer exist or the exclusion of liabilities that do exist, the process of changing the interests of the parties in property can become distorted and artificial. The greater the value of the notional assets and ignored liabilities, the greater the distortion and artificiality. Adding to (or perhaps in part prompted by) the practical concerns about that approach, there has been comment[4] suggesting that a future Full Court may express a different view to the views summarised in Omacini or for that matter, to the approach taken in Chorn v Hopkins (2004) FLC 93-204. It is my respectful observation that if authority is to give way to obiter dicta that should not be done at first instance. As far as I am aware the Full Court has not reversed the earlier authorities. Notwithstanding the comments in Bevan, in Chapman & Chapman [2014] FamCAFC 91 the Full Court did not rule out the add-back approach, citing Cerini & Cerini [1998] FamCA 143, Omacini and Townsend & Townsend (1995) FLC 92-569 although it noted from Cerini that “add-backs” are the “…exception rather than the rule…”.

   [4] See comment in the Full Court reasons in Bradley and Bradley [2013] FamCAFC 116 – Finn J at para 160 and a more oblique reference at para 79 of the joint judgment of the Chief Justice and Thackray J

5. Here it is argued for the wife that although the moneys have been disbursed, there should be included in the balance sheet and credited to the husband, $159,176.63 representing the net proceeds of sale of the H property. The husband opposes any add-backs but if there is to be an allowance for this item then:

   a)the allowance should be reduced to the extent that those proceeds were applied to other debts; and

   b)in any event a similar approach should be taken to the $203,000 by which the debt secured on the Suburb N property was increased by the wife since separation.

6. Fundamental to the argument made on behalf of the wife is that the husband agreed to add-back the net proceeds of the H property and based on the husband’s agreement the wife agreed not to lodge a caveat on the property. There was an extensive exchange of emails on the issue but on 14 December 2009[5] the wife sought an assurance that the husband would treat the gross proceeds of sale as a distribution to him in any property settlement between the parties. On 17 December 2009[6] the husband’s solicitor responded with “I have received instructions to agree that any net amount received by our client from the sale of the [H] property will be taken into account as a distribution to him from the pool of assets.”

   [5] Page 183 of the annexures to the wife’s affidavit

   [6] Page 179 of the annexures to the wife’s affidavit

7. Lest there be any doubt about the husband’s intentions, he addressed this issue in his affidavit filed 2 April 2013, commencing at paragraph 37. The affidavit refers to a balance sheet that is not in evidence before me but the husband deposed in paragraphs 44 and 45 that the net proceeds were brought to account in that balance sheet: $80,000 in the form of a term deposit and $79,176. Together, those amounts account for the net proceeds. That concession excludes the idea that the husband meant that the preliminary distribution would be taken into account in a way other than adding it back to the balance sheet.

8. During submissions an attempt was made on behalf of the husband to withdraw his concession. The treatment of balance sheet items is a matter for the Court but litigation is conducted by reference to certain rules and it seems to me to be highly undesirable for the Court to allow the husband to walk away from a clear concession, albeit one made several years ago, being a concession on which the wife relied to her detriment.

1. That is not the end of the matter. It is argued on behalf of the husband that some of the proceeds were used to discharge a debt that would otherwise have appeared on the balance sheet. $80,000 was applied to the BV Pty Limited overdraft. The wife does not agree that the add-back should be discounted by $80,000. Her concern lies in her case that the husband wasted assets, in part through his use of BV Pty Limited funds. For example the submission on behalf of the wife points out that although the overdraft was $80,000 when it was paid out it was $62,000 at separation and $23,000 at some point after separation. The argument runs, in those circumstances, why should $80,000 be deducted from the add-back of $159,176.63 for the net proceeds of sale of the H property?

2. At one point the parties formally agreed that the net proceeds of the H property sale would be included in the balance sheet as a preliminary distribution to the husband. The evidence is that $80,000 of the H property proceeds was applied to the debts of BV Pty Limited. In those circumstances it would be unfair not to reduce the previously conceded figure for that payment.

3. I have referred to appellate comment[7] which has led to speculation that an add-back approach might be proscribed in the future. Whatever might be said about the current state of authority on the topic, it can safely be said that it is neither compulsory nor prohibited to include assets that no longer exist or exclude current liabilities, when settling the relevant pool of assets in s 79 proceedings.

   [7] Obiter in the Full Court judgment in Bradley and Bradley [2013] FamCAFC 116

4. I will add back $79,176 to the credit of the husband in the list of relevant assets. In my view, given the way in which the parties treated the issue between themselves, that is a better way of dealing with the circumstances of the application of the H property proceeds.

5. It is submitted for the husband that if there is to be an add-back in his hands for the H property proceeds then the same approach should be taken in relation to what was about a $203,000 increase in the mortgage on the former matrimonial home, after separation. I accept that there needs to be consideration of the circumstances of the mortgage increase but rather than by add-back, a better approach would be to deal with it under s 79(4)(e) – s 75(2)(o).

6. There is no agreement about the treatment of the paid costs of the parties. In addition to the rationale canvassed in Omacini there are the complicating factors that - insofar as the family law proceedings involved the work of solicitors, the wife was largely, if not exclusively, self-represented and so did not need to pay as much for her representation; and the fact that some of the fees paid by the husband related to other proceedings (AVO and drink drive proceedings). Again there is no prescribed answer to this dilemma.

7. In my view the better course is to add back the amount paid on both sides. It would be obviously unfair to visit on the wife the application of matrimonial funds to the husband’s costs of AVO proceedings brought for her own protection. The family law costs issues should be left to s 117, if that is necessary.

8. The balance sheet has the costs described as follows:

12	H	Legal costs paid by husband for family law either by the husband or BV Pty Ltd *AVO/breach/drink drive charges ** Family Law and associated matters + TBA	$17,824.50* $38,389.06** $56,213.56 +TBA	$0
13	W	Legal costs paid by wife for family law	$17,480.67	$0

1. The endorsement “TBA” on the balance sheet in respect of the husband’s costs suggests that the husband may have paid other costs as at the time of the hearing. Learned counsel for the husband said in submissions that he did not think there was any issue about the figures in the balance sheet for items 12 and 13. In an exchange during submissions I told the parties that I intended to replace the information under item 12 with the information from the husband’s cost memorandum. Despite that statement, the husband’s counsel again said that there was no controversy about the amounts recorded against items 12 and 13. It is not possible to reconcile the information in the balance sheet and the husband’s costs memorandum[8].  According to the costs memorandum, as at the hearing the husband owed costs in the sum of $134,780, having incurred $204,850 in total. Therefore, on the face of that document the husband had paid $70,070. No combination of the figures in item 12 of the balance sheet makes any sense of the figure of $70,070. The balance sheet figures total $112,426.62. It is not my role to struggle with the figures placed before the Court.  I was told on two occasions that there was no contest about the figures on the joint balance sheet at item 12.  I am obliged to record the husband’s paid costs at $112,426.62. I note that the husband has identified on the amended version of the costs memorandum, that the source of the funds paid was BV Pty Limited.

   [8] Exhibit 16

2. The wife has paid $17,480.67 in legal fees and that payment too will be added back. I note that there is a balancing allowance for the wife’s American Express credit card debt of $11,569 which accounted for some of those costs. That debt too will be brought to account.

3. The parties’ superannuation interests are of a similar value and neither party seeks that those interests be treated differently to the other assets. I will include the superannuation interests with the other assets.

4. I find that the assets are:

Owner	Description	Value
H	Land in Ireland (€173,250 as per orders 2 December 2013 w exchange rate as at 12.2.14)	$261,853
H	IAG shares	$700
H	Net proceeds of sale of H property received by the Applicant	$79,176
H	Furniture at U Street, Suburb N or otherwise received by the Applicant	$500
H	Dinghy	$600
H	Paid legal fees	$112,426.62
H	Industry super fund as at 2/12/2012	$55,835
W	C Street, Suburb N	$980,000
W	CBA Complete Access account number …814 as at 30 Jan 2014	$875
W	CBA Complete Access account number …145 as at 30 Jan 2014	$394
W	Jewellery	$2,300
W	XX Lawyers Pty Ltd (XX) $5,000	$5,000
W	Furniture and effects at C Street, Suburb N	$2,000
W	Paid legal fees	$17,480.67
W	Plan 1 accountant’s super at 3 May 2013	$59,085
Total		$1,578,225.29

Liabilities:

1. As to the disputed issues:

Item 14

1. The claimed tax is $40,000. BV Pty Limited has been notified[9] that as at 28 January 2014 the tax owed stood at $39,195.63. The relevant time to identify assets and liabilities and their value is the date of the hearing. It is the husband’s evidence that he ceased making payments to the Australian Taxation Office.

   [9] Annexure C to the husband’s affidavit of 7 February 2014

2. The submission on behalf of the wife is that the debt should not be included in the balance sheet because there is insufficient evidence that the husband will ultimately be liable for the debt, given that the company is being de-registered. It was submitted for the wife that this claim falls within the category of debts discussed in Biltoft & Biltoft (1995) FLC 92-614 as uncertain or questionable and therefore should not be included in the balance sheet.

3. BV Pty Limited is being de-registered. There is no evidence that the husband will be ultimately obliged to pay its tax debt. I will not include the debt.

Item 15

1. Directors’ loans are not relevant to the values attributed for the purposes of these proceedings to BV Pty Limited and XX Lawyers Pty Ltd. In any event I understood that the parties ultimately agreed that these loans should not be included in the balance sheet. On that basis I will exclude the directors’ loans from the balance sheet.

Items 16, 21, 22 & 23

1. There are arguments on each side that the parties have wasted assets. It is beyond the scope of these proceedings to conduct an audit of the use and application of funds by the parties since separation.

2. It is submitted for the wife that the husband has not provided any evidence that the American Express debt remains outstanding or the balance of the debt at the time of the hearing. That may be so, but he has given evidence about the estimated debt in his Financial Statement. He did not resile from that evidence. I will include the claimed debt in the balance sheet.

3. There is no dispute about the existence of the remaining credit card debts. There needs to be a reason for ignoring a debt. I will include the parties’ credit card debts in the balance sheet.

Items 17 & 18

1. The matter of unpaid legal fees should be left to any costs dispute between the parties. From the submissions made in their cases, the parties seem to agree on that position.

2. Contrary to the submissions made on behalf of the husband it would be unjust to include the child support debt as a liability of the husband and an asset of the wife. To take that approach would be to reverse the child support obligation. Both the unpaid fees and child support debt will be excluded.

Item 20

1. Subject to arguments about the purpose to which the expenditure was put, I would likely include the wife’s credit card debt in any event but here it is necessary to do so. The debt was incurred for the wife’s legal expenses which have been added-back as a notional asset. It would be unfair not to take the related borrowing into account.

Items 24 & 25

1. The wife’s income tax obligations are debts for which she will be responsible. Unlike the BV Pty Limited tax debt, there is no suggestion that they will not be payable by the wife. They should be included in the balance sheet.

Item 26

1. The argument made on behalf of the husband is that the parties have been separated for several years, that these debts arose long after separation and therefore should be excluded.

2. The debts themselves are not challenged and no principled basis was identified for ignoring them. They will be included in the balance sheet.

3. I find that the relevant liabilities are:

Liabilities

Owner		Description	Value
16	H	Liability to pay American Express	$15,000
19	W	CBA Home loan …009 Mtg C Street as at 30 Jan 2014	$396,377
20	W	AMEX Account (Incl. $11,550 barristers fees paid and included below in legal costs of the wife)	$11,569
21	W	ANZ Mastercard as at 30 Jan 2014	$14,988
22	W	Commonwealth Bank Mastercard as at 30 Jan 2014
23	W	28 Degree Mastercard as at 30 Jan 2014
24	W	Personal Tax liability to ATO actual	$11,767
25	W	Contingent tax liability to ATO for y/e 30 June 2013	$3,500
26	W	J Builder $600; school fees $734.50; Ms I CA $650.00; Council Rates $490	$2,474
Total		$455,675.00

Net assets

1. The net assets for the purposes of calculating whether there should be an alteration of the parties’ interests in property and if so, what that alteration should be, are: $1,122,550 ($1,578,225 - $455,675).

FINANCIAL RESOURCE

1. There is no evidence that either of the parties has the benefit of a financial resource.

CONTRIBUTIONS

1. The obligations placed on the Court by s 79 call for an assessment of the respective contributions by and on behalf of the husband and wife. The manner of assessing contributions has been the subject of previous decisions. The contributions of a parent and homemaker are to be assessed, not in any merely token way, but in terms of their true worth to the building up of the assets.[10] There are said to be risks in taking an overly technical approach to the assessment of the respective contributions of the husband and wife in that the Court can become involved in questions of the quality of contributions which go far beyond the real world expectations of husband and wife.

   [10] In the Marriage of Shewring (1987) 92 Fam LR 385.

2. As to whether the Court should apply the considerations in s 79(4) to the assets globally or asset by asset, the authorities have it that the latter approach is preferred, however in appropriate circumstances either approach is permissible and sometimes the asset by asset approach is best. See In the Marriage of Lenehan (1987) FLC 91-814; In the Marriage of Norbis (1986) FLC 91-712; In the Marriage of Zyk (1995) FLC 92-644.

3. The husband contends for a two pool approach albeit only for the purposes of the assessment of contributions, with the Irish property as Pool A and the balance of the property and superannuation in Pool B. The husband seeks that the same adjustment be applied to both pools. The wife’s case was argued globally.

4. There is no argument here that superannuation should be addressed differently from the other assets. That is sensible as the parties have superannuation interests of similar value and no splitting order is sought. The only issue is related to the Irish property. In my view the better approach is to employ one pool of assets. The fact that the balance of contributions to some assets is different to that in respect of others can be accommodated notwithstanding that s 79(4) is applied globally.

Contributions

Section 79(4)(a) contributions

1. Financial contributions to property, both direct and indirect were made by each of the husband and wife.

2. The initial contributions of the wife were slightly greater than those of the husband. Ignoring cars and furniture and based on the agreed or conceded position or my findings on contentious issues, the husband brought in the following:

Asset / Liability	Value
H property	$280,000
Irish savings	$41,000
Cash on hand	$20,000
Superannuation	$15,755
Irish property	$143,750
Mortgage on H property	-$21,272
Credit card debt	-$4,000
Total	$475,233.00

1. On a similar basis, the wife brought in the following:

Asset / Liability	Value
Suburb N property	$675,000
Payment from FF Firm	$10,576
Cash on hand in XX Lawyers	$812
Work in progress	$812
Superannuation	$40,372
Mortgage on N property	-$167,852
Credit card debt	-$8,891
Obligation to the children of her first marriage which by payments during cohabitation and after separation cost about	-$30,000
Total	$520,829.00

1. It is submitted for the wife that she made valuable contributions towards the Irish property in the form of perfecting the husband’s title and formalising the financial arrangement for the use of the property. I accept that proposition but those contributions are dwarfed by the fact of the husband bringing that property into the marriage.

2. The husband conceded that during the marriage and since, he incurred thousands of dollars in driving and parking fines. Rather than as a contribution factor, I will take that issue into account under s 75(2)(o) pursuant to s 79(4)(e).

3. During the marriage, the parties both contributed their income from personal exertion. The parties’ arrangement had priority given to the husband’s work over the wife’s work. Matters are made somewhat more complicated because the wife performed services for BV Pty Limited, without remuneration and yet BV Pty Limited was paid by the wife for some of the work it did to improve the N property. In that way it can be argued that although the income through BV Pty Limited was greater than that received through the wife’s firm, the wife made indirect contributions to the husband’s income. There is a dispute between the parties about the source of funding for renovations by BV Pty Limited to the former matrimonial home. It is not necessary or possible to resolve that dispute. The renovations were conducted during the parties’ relationship. The parties both worked and the renovations were completed.

4. As I understood the argument, the submission on behalf of the wife is that it diminishes the husband’s contributions that by the end of the marriage the husband no longer had the H property or BV Pty Limited and that therefore, those cannot represent contributions made by the husband. I disagree.

5. On the basis that the wife was marginally ahead by way of initial contributions, in my view, the financial contributions were equal overall.

Section 79(4)(b) contributions

1. This provision deals with direct and indirect non-financial contributions other than those made in the form of parent and homemaker contributions.

2. The wife performed some legal work in relation to the Irish property. There is a dispute about the extent and import of that work. While there was value in that work, in my view it was not an important contribution.

3. The wife undertook the paperwork and accounts for the family and the husband’s business. In that work she was assisted by a secretary retained by the parties.

4. The husband personally and through his company undertook improvements to the Suburb N property. Part of the work of BV Pty Limited on the N property was paid for by borrowing $184,000 from the ANZ Bank. Ultimately each of the parties contributed to the repayment of that borrowing. The wife asserts that it was a much greater sum but gives evidence that she or her firm made specific payments totalling about $57,000 to BV Pty Limited or the husband. As I have indicated, it is neither possible nor necessary to resolve that dispute.

5. In my view the non-financial contributions were equal.

Section 79(4)(c) contributions

1. This provision deals with contributions to the family including contributions in the form of homemaker contributions and contributions to children of the marriage.

2. It is conceded that the wife made the greater contribution as parent and homemaker.

3. It was the wife’s evidence that she spent on average 12 hours a day on parent and homemaker activities. That commitment was made, she said, despite some assistance on the domestic front from the administrative assistant retained by the parties.

4. The husband agreed that he went to the pub on most nights for an hour or more. The wife says it was much longer. The husband denied consuming six to eight alcoholic drinks each night, saying that he consumed three to four beers a night but agreed that he occasionally also had wine or cognac when he came home. As was discussed during submissions great care is needed in taking account of the habits and hobbies of the parties.

5. There is no suggestion that the wife’s energies were not entirely applied to the purposes of the marriage. Since separation the wife had almost exclusive responsibility for the children.

6. The wife made the greater contribution as parent and homemaker.

Conclusion on contribution

1. The parties’ marriage involved about seven years of cohabitation and contributions spanned more than 11 years. It is submitted for the husband that he contributed 100 per cent to the Irish property and 44 per cent towards Pool B. On his proposed pools of assets I calculate the overall contribution impact of that submission to be about 60:40 in favour of the husband. On the evidence before me, that cannot be sustained. The submission for the wife is that her contributions were 60 per cent compared to 40 per cent by the husband.

2. The wife argues that in assessing the husband’s contributions, the Court should take into account that the husband wasted some of the value of the asset represented by the prestige motor vehicle. In 2002 the parties bought a prestige motor vehicle for the use of the wife for the sum of $63,000. The wife received a $10,500 trade-in for in her Honda motor vehicle. There was extensive correspondence from the wife to the husband seeking his agreement to deal with the vehicle. The husband did not make any response to that correspondence. In 2010 the wife signed transfer papers to allow the registration of the prestige vehicle to be put into the husband’s name. The car was valued at $11,500 on 23 February 2011. On 29 March 2011 the wife delivered the prestige vehicle to the Husband. The husband alleged that at the time of delivery the vehicle had several defects. The vehicle subsequently sat in a local car park for nearly one year. The car was sold in about February 2012 for $2,000. That loss could have been as much as $9,500. In the context of these proceedings $9,500 is not an issue of great significance. It appears that by failing to respond to the wife’s requests, the husband contributed to the loss of the value of this asset.

1. I return then to the issue of whether it would be just and equitable to make an order for settlement of property. The High Court has provided relief from the compulsory consideration of the matters contained in s 79(4) in considering this question. However, rather than presume on that ruling, in my view the answer to the s 79(2) question here does not arise from the special circumstances of the case such as the fact or otherwise of the breakdown of the consortium vitae and an analysis of the comparative needs of the parties nor from the long period of separation and the financial arrangements that were put in place many years earlier. In other words this does not seem to be a case of the type addressed in Stanford or Bevan.

2. Because of the way in which the parties now hold their property it is not necessary to alter the parties’ interests in property to achieve an appropriate outcome[13]. In other words, an order is not necessary to achieve a proper settlement of property. In these proceedings only the wife would benefit from an order that would reflect the application of s 79(4) to the facts of the case and she does not seek such an order. In that event, it seems to me that it would not be just and equitable to make any order. In my view the circumstances do not warrant the making of an order for settlement of property.

   [13] s 79(1)

CONCLUSION UNDER SECTION 79

1. This was a marriage that spanned seven years and very significant contributions were made by each of the parties over that period and since. The parties shared the work of the marriage in different ways but overall the contributions of the wife were greater than those of the husband. An adjustment in favour of the wife is justified, particularly by reference to the parenting arrangements for the parties’ children. Although the application of s 79(4) would support a modest alteration in interests in property whereby the husband pay an amount to the wife, she does not seek any such payment. In my view there should be no order under s 79.

The Costs Of Ms P’s Report.

1. An order was made on 22 April 2013 to the effect that the husband would pay the costs if the expert found certain things as outlined above in paragraph 51.

2. The Report cost $33,750. As I understand it, Ms P has invoiced the parties but has as yet not been paid. The expert reported that the financial accounts and associated tax returns supplied by the husband for BV Pty Limited are substantially incorrect and misleading, if not fraudulent. I find that the quantum of the costs that the husband is required to pay is $33,750. I will order that the husband pay that sum to Ms P within one month from the date of these orders.

The Husband’s Child Support Debt

1. There is a child support obligation and as at 30 January 2014 the husband was in arrears of child support in the sum of $14,902.05. The wife has approval to pursue what would otherwise be a debt due to the Commonwealth.[14]

   [14] See exhibit 6

2. It is my recollection that the parties both agreed that there would be an order which ensured that the debt would be satisfied in the course of the orders made in these proceedings. As matters have transpired, there will be no order under s 79. The debt is owing.

3. I will order that subject to any written agreement between the parties to the contrary, that the husband discharge any arrears of his child support liability within one month.

I certify that the preceding one hundred and ninety one (191) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan delivered on 10 July 2014.

Associate: 

Date:  10 July 2014