Merriman v Merriman

[1993] FamCA 115

FAMILY COURT OF AUSTRALIA

IN THE MARRIAGE OF: RONALD JOHN MERRIMAN

APPELLANT/HUSBAND

AND ELIZABETH MAJELLA MERRIMAN

RESPONDENT/WIFE

Appeal No. NA14 of 1993 File No. BR9788 of 1991

Number of pages - 14

[1993] FamCA 115; (1993) FLC 92-422

[1993] FamCA 115; 17 Fam LR 22

Property settlement - Maintenance of spouse - Child Support

COURT

IN THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA

BARBLETT DCJ, ELLIS AND FINN JJ

CATCHWORDS

Property settlement - proper approach by trial Judge - adequacy of reasons for judgment assessment of relevant factors.

Maintenance of spouse - whether trial Judge proceeded on basis of mistaken concession assessment of relevant factors.

Child Support - assessment - departure from - whether appropriate. The parties commenced to cohabit in May 1986, married in July 1986 and separated on 17 May 1991. There are two children of the marriage born in 1987 and 1989 who resided, after separation, with the wife. Although unable to make specific findings, the trial Judge considered that neither party made a contribution at the commencement of cohabitation significantly greater than that of the other.

At trial, the assets of the parties were valued at $1,060,992 net mainly because of a lottery prize of about $1,292,000 won by the husband twelve months after separation.

The trial Judge assessed the contributions of the parties during their relationship as being equal in value, then referred to the significant ongoing contribution of the wife in relation to her care of the children, the enormous disparity in the financial circumstances, the extravagant expenditure of the husband since the lottery win and ordered that the wife receive 25 per cent of the net assets, namely $265,248.

The wife claimed spousal maintenance which the trial Judge assessed at $400 per week capitalised over 3.5 years to $69,672. She also sought a departure from the administrative assessment relating to child support. The trial Judge increased the assessment from nil to $330 per week having regard to the husband's assets.

The husband appealed against all three orders. He submitted that the trial Judge:-

1. erred in that he failed to approach the property settlement proceedings in accordance with the established approach referred

to in Ferraro [1992] FamCA 64; (1993) FLC 92-335 at 79,560 and/or failed to give any appropriate explanation for his failure to adopt that approach.

2.          2.        erred in that he failed to give sufficient reasons for his decision.

3.          3.        failed to take into account a number of factors including thehusband's post-separation contribution to the family, his age, state of health, capacity to earn income, etc. and the time the husband alleged the children spent with him (45 per cent of the time).

4.          4.        failed to properly consider the effect of his order and the effect of orders for spousal maintenance and child support. and that the award did not fall within the ambit of a proper exercise of the discretion.

Further, submitted that in relation to the claim for spousal maintenance,

the trial Judge mistakenly proceeded on the basis that the husband conceded that the wife could not support herself adequately and that lump sum maintenance was desirable. Further, it was submitted that in calculating the maintenance, the trial Judge took into account interest the wife would receive upon capital but failed to take into account the relevant capital sum and did not consider the threshold test referred to in s.72.

Submitted in relation to child support variation that the amount ordered was excessive and in the circumstances unreasonable and plainly unjust.

Held:

1. That the appeal must be allowed on the ground that the trial Judge had not given sufficient reasons for his decision to award the wife twenty-five percent of the net assets, to enable an appellate Court to form a view as to whether this decision could be regarded as falling within the wide ambit of the discretion under s.79 of the Act. A new trial was accordingly necessary.

2.          2.        The issue of whether a failure to follow, without explanation,the established approach to property settlement proceedings (as referred to in Ferraro [1992] FamCA 64; (1993 FLC 92-335 at page 79,560) left open.

3.          3.        The spousal maintenance and child support matters not consideredas these matters will have to be re-determined in the light of the further property settlement determination.

Orders:

. Appeal upheld.

. Matter remitted for re-hearing.

. Costs certificates to both parties.

HEARING

BRISBANE, 7 October 1993

28:10:1993

Mr O'Ryan QC (instructed by Mr Michael Muggridge, Solicitor), appeared on behalf of the appellant husband.

Ms Carew of counsel (instructed by Messrs French Wright and

Dennett, Solicitors), appeared on behalf of the respondent wife.

ORDER

Appeal upheld.

DECISION

BARBLETT DCJ, ELLIS AND FINN JJ This is an appeal by the husband against the following parts of the decree made in the Brisbane Registry of the Court on 28 May 1993:

"1. That the HUSBAND pay to the WIFE the sum of $344,390 as follows:

(i) $150,000 within seven days of the date hereof; (ii) The balance of $194,390 within two months of the date hereof;

2. That the payment by the HUSBAND to the WIFE of the sum of $344,390 or so much thereof as remains outstanding from time to time, be a charge over the real property owned by the husband and situated at 132 Cockleshell Court, Runaway Islands, Gold Coast,

Queensland and the motor vessel owned by the husband and that the HUSBAND at the request of the WIFE and at the husband's expense, provide to the WIFE, within 14 days of such request a Bill of Mortgage in registrable form over the real property above referred to and a Bill of Sale in registrable form over the motor vessel above referred, securing payment of the aforesaid monies.

7. That for the period commencing 1 June 1993 and concluding 30

November 1996 the HUSBAND pay each and every week for the

maintenance of the children of the marriage THOMAS JOSEPH JOHN

MERRIMAN born 24 November 1987 and TEGAN ELIZABETH MAJELLA STELLA

MERRIMAN born 16 April 1989, the sum of $330."

Background

1. 2.        The relevant background to this matter is as follows. At the time of the hearing before thetrial Judge the husband was aged forty-eight and the wife was aged twenty-nine. The parties had commenced cohabitation on 1 May 1986 and were married on 4 July 1986. In August 1986 they moved to the Gold Coast where they established a business known as "Slimline Security". This business was initially in the wife's sole name, but was later, and until their separation, operated as a partnership between the parties. In November 1988 the parties acquired land at Willowvale and entered into a contract for the construction of a home. That home was sold shortly after separation at a loss of some $5,000.00. There were two children of the marriage, Thomas, born on 24 November 1987, and Tegan, born on 16 April 1989.

2. 3.        The parties separated on 17 May 1991 when the wife moved with the children from the home at Willowvale apparently to rented premises. Sole custody orders in favour of the wife with orders for regular access in favour of the husband were made on 19 November 1991 apparently on an interim basis, and then on a final basis on 11 August 1992.

3. 4.        In January 1992 the wife commenced full time employment, but in May of that year she commenced a university law degree and reduced her hours of employment. In July 1992 she gave up all employment. In May 1992 the husband won a Gold Lotto prize which the trial Judge apparently accepted was valued at $1,292,000.00. The husband used this money to acquire various assets and to maintain himself. In November 1992 the husband consented to an order that he pay $400.00 per week to the wife and the trial Judge found that the husband had complied with that order.

4. 5.        The wife's applications for orders for alteration of property interests and/or lump sumspousal maintenance and for a departure from an administrative assessment of child support were heard by the trial Judge on 18 May 1993.

The Judgment of the trial Judge

1. 6.        In a judgment delivered on 28 May 1993, the trial Judge dealt firstly with the wife's application for alteration of property interests. In dealing with this application his Honour first considered certain matters under the heading "Financial Circumstances at Commencement of Cohabitation", and he concluded in relation to those matters that he was "not in a position to find other than that neither party made a discernibly and significantly greater contribution at the outset of cohabitation than the other."

2. 7.        Then under the heading of "Contributions and Relevant Events during Cohabitation", thetrial Judge referred to certain matters in connection with the operation of the parties' security business and in connection with the purchase and construction of the Willowvale home. However he made no findings at this point in relation to the parties' contributions to the business or to the home, apart from stating that he accepted the wife's assertion "that she was the principal homemaker and child-rearer", and apart also from concluding that in his view "the likely position" was "that each party did work in and about the home".

3. 8.        Then under the heading of "Events post-separation to trial", the trial Judge described theway in which the parties had divided their assets after separation. He also referred to the husband's lottery win, and he found that with this prize money the husband had purchased two motor vehicles for approximately $168,000.00 and $43,000.00 respectively, a boat for approximately $292,000.00, and a furnished home for $372,000.00, that he had $180,000.00 invested at the time of the trial, and that in the twelve month period between the lottery win and the trial the husband had maintained himself from capital and interest earned on cash invested. The trial Judge also concluded that in that twelve month period the husband had seemingly spent something of the order of $170,000.00 on unidentified living expenses. However at this point he made nothing that could be described as an adverse finding against the husband in relation to his use of the lottery prize money. Also in this context the trial Judge referred to an issue that existed between the parties as to exactly what payments had been made by the husband to the wife since separation, but he did not make any specific finding about this issue, other than (a) to comment that while it might well be that following the lottery win the husband could have paid more to the wife, he did "not consider that the position calls for an adjustment out of (sic) alteration of property interests now", and (b) to conclude that since the making of the consent order in November 1992 the husband had paid $400.00 per week to the wife.

4. 9.        His Honour then considered certain matters under the heading of "The parties' presentand anticipated circumstances". Under this heading he referred to the facts that the wife was twenty-nine years of age and in good health; that she had two years to complete of a law degree with a year of a practice course to follow; that she currently received a halfscholarship, a supporting parents pension, maintenance paid by the husband, family allowance and some Austudy; that her experience since completing the NSW Higher Schools Certificate in employment had been in sales and public relations positions; that she would wish to purchase a home valued between $150,000.00 and $185,000.00 and a new motor vehicle; and that her weekly needs amounted to $520.00 per week (and his Honour noted that "no real challenge was made to the assessment of her needs"). Also under the same heading, the trial Judge referred to the facts that the husband was forty-eight years of age and was "apparently recovering from some injuries received in a motor vehicle accident"; and that he had deferred his plans to resume operation of the security business until about August of this year. His Honour then stated "It would seem that at best such a business would produce a middle income". However the trial Judge did not at this point attempt any evaluation of the respective present and future circumstances of the parties.

10. His Honour then incorporated into his judgment the schedule of assets and liabilities that had been agreed by the parties. The assets totalled $1,110,050.00; the liabilities totalled $49,058.00; and the balance was $1,060,992.00. We note that virtually all the assets listed on the schedule had been acquired by the husband after separation and as a result of his lottery win.

11. Finally in dealing with the property settlement application the trial Judge said as follows:

"In deciding upon an appropriate alteration of property interests one can immediately observe that the wife made no contribution whatsoever to the property of the husband. A year after separation the husband received a windfall as a result of a Lotto ticket purchased with his own monies. Had such a purchase occurred after the determination of the question of alteration of property interests, the wife would have no claim arising under Section 79 of the Family Law Act, thereon. That of course is not the position here, but such an observation shows the distance between any contributions made during the cohabitation, or at the commencement thereof, and the property a share of which is sought.

On the other hand it is clear that for an order altering property interests to be made there does not necessarily have to be a connection between contributions relevant under Section 79 of the

Family Law Act 1975 as amended, and that property. (See COLLINS

AND COLLINS (1990) FLC 92-149 at 78,042-3 and SHAW AND SHAW

(1989) FLC 92-010 at 77,292.) The wife made fulsome contributions of a type recognised under Section 79 during the relationship of the parties, equal in value as I assess them, to those of the husband. She has the burden of two young children and this is a most significant ongoing contribution. There is an enormous disparity between her financial circumstances and those of the husband. In addressing the question of a percentage to be applied to the existing net assets I have regard to the extravagant expenditure of the husband since the Lotto win. In all the circumstances it seems to me appropriate that the wife receive 25 percent of the current net assets.

25 percent of $1,060,992 is $265,248. The wife has certain debts according to the schedule and she should pay these debts and to achieve the net position of 25 percent she should receive from the gross assets the amount of those debts and there should be subtracted those items of property already in her possession, being furniture, computer and Honda motor vehicle. The payment required to her is calculated as follows:

25% of net assets $ 265,248 Plus : amount to discharge liability 13,970

279,218

Less : property already in wife's possession 4,500

$274,718

12. The husband's position after payment to and retention of property by the wife will be:

Gross Assets $1,110,050 Less : to be received by wife in cash and property 279,218 830,832

Less : Liabilities of

Husband 35,088

$ 795,744."

13. The trial Judge then dealt with the wife's application for spousal maintenance. He approached this application on the basis that Counsel for the husband had conceded (a) that the wife could not support herself adequately and (b) that lump sum maintenance was desirable, and thus he had only to concern himself with the matter of "the appropriate calculation". In so doing he accepted that out of the $260,000.00 cash that the wife would receive by way of property settlement, she would need to spend $150,000.00 on the acquisition of a home, and he went on to say:

"Thus after providing accommodation for herself, she would have $110,000.00 available. She should not I consider have to maintain herself from capital. Having regard to the rates of interest prevalent in the community at this time, which rates I consider are so notorious that I can take judicial notice in a broad sense, I would think that the wife could receive income on invested monies after property settlement of around $6,000 and that there should be little impact of taxation on that interest. Thus the wife can from her own resources provide $120 a week approximately to meet her expenses reducing the shortfall between those expenses and income to $400 per week. Given the wife's employment history and the fact that she was in full-time employment after separation and prior to commencing the law degree, I consider that the wife should not be maintained for longer than it takes to complete her degree and that she should thereafter be regarded as capable of supporting herself, whether by using that degree or her other employment capacities. Therefore I consider that maintenance should be for three and a half years. The capital sum before discount resulting from these considerations is $72,800, which discounted at 3 percent is

$69,672."

14. Finally the trial Judge dealt with the application in respect of child support. He stated at the outset that he did not consider that lump sum child support should be ordered. He then turned to consider the current administrative assessment (issued on 18 January 1993) which required no payment of child support by the husband. In relation to this matter his Honour went on to say:

"Quite clearly the assessment is based on circumstances which bear no relation to the husband's current financial circumstances. He currently has net assets worth well over a million dollars. He has a capacity to soon earn income from exertion in his business. I have no doubt that the husband could, after payment of property settlement and spousal maintenance, restructure his capital acquisitions to produce an income from which, together with income from business he could maintain himself and pay $330 a week, which are the unchallenged expenses of the children.

The wife's income from investment will be consumed for her own needs and it is appropriate that the husband bear the full cost of the needs of the children. However the position may well change in three and a half years time and I am of the view that the departure should apply for the balance of the June 1993 financial year and thereafter until December 1996."

15. His Honour then went on to refer to the relevant parts of Section 117 of the Child Support (Assessment) Act and to find that a ground for departure from the current administrative assessment existed under that section and that it would be just and equitable and otherwise proper for there to be such a departure whereby the husband pay $330 a week child support for the next three and a half years.

16. The trial Judge then proceeded to make seven orders. Three of those orders are the subject of this appeal and they are set out at the commencement of this judgment. The other four orders - none of which are the subject of appeal - related to the division of chattels between the parties and to indemnities.

The Grounds of Appeal

17. The grounds of appeal contained in the Amended Notice of Appeal, which was relied on before us, were as follows.

"(a) The absence of nexus between the contribution of the

Wife and property;

b.     (b)  The absence of unusual circumstances to entitle the Wife tobe regarded as contributing significantly to the Husband's postseparation Gold Lotto win;

c.     (c)  Failure of the Court to place sufficient weight on Section

79(4)(d) in that the effect the orders will have on the Husband's earning capacity will prohibit him from making the Child

Maintenance contribution ordered;

b.     (d)  That the Court failed to take into account the SpousalMaintenance and Child Maintenance Orders in considering alteration of property interests;

c.     (e)  That Child Maintenance ordered is excessive;

d.     (f)   That the Court has given a disproportionate weight to the

Wife's contribution to the welfare of the family; (g) That the Court failed to take into account the continuing contribution by the Husband to the support of the Wife, and in particular the children of the marriage, by the Orders for

Spousal and Child Maintenance;

h. (h) That the Court failed to take into account in favour of theHusband any matters in Section 75(2) and in particular:

i.    (i)     The age of the parties;

ii.     (ii)  The state of health of each party;

iii.   (iii) The limited earning capacity of the Husband;

(i) That the result is unreasonable or plainly unjust."

18. Ground (b) of the above grounds was not ultimately pursued by Counsel for the husband. However at the commencement of the hearing of the appeal, Counsel for the husband was granted leave to rely on the following two additional grounds of appeal.

"1. His Honour erred in that His Honour failed to approach the property settlement proceedings in accordance with the well

established approach referred to in Ferraro [1992] FamCA 64; (1993) FLC 92-335 at

79-560 which focuses on the relevant components of the property then matters of contribution then s.75(2) factors or in the alternative failed to give any appropriate explanation for his failure to take this approach.

2. His Honour was in error in that he failed to give sufficient reasons for his decision."

19. It was in support of these two additional grounds of appeal (which would seem indeed to encompass the more particular grounds of appeal against the decision in relation to property settlement contained in the Amended Notice of Appeal) that Counsel for the husband primarily addressed his submissions. In his submissions Counsel examined the structure and content of the judgment of 28 May 1993 in order to demonstrate that, while the trial Judge had undertaken the first step of the approach, preferred by Full Court authority, to the determination of property settlement proceedings, being the identification and valuation of the parties' property available at the time of hearing, he had then failed to undertake both the task of identifying and assessing the parties' contributions and also the separate task of assessing the future needs and any other relevant factors under Section 75(2) of the Family Law Act. In the submission of Counsel for the husband, the trial Judge had blurred the various matters that should be either considered as contributions to property or to the welfare of the family, or considered under Section 75(2), and in so doing and in failing to adopt the approach preferred by the authorities, the trial Judge had failed to give adequate reasons for his decision that the wife should receive twenty-five percent of the available property, and had thereby fallen into error.

20. Further it was submitted that the property settlement award did not fail within the ambit of the trial Judge's discretion, and more particularly it was submitted that the trial Judge had erred in failing to take into account a number of relevant factors including the husband's post-separation contribution to the family as well as his age, state of health, capacity to earn income, his ongoing contribution to the children, and the effect of the orders for spousal maintenance and for child support.

21. In relation to the award of lump sum spousal maintenance, it was submitted by Counsel for the husband that the trial Judge had misunderstood the concession made at the trial by Counsel for the husband in that the concession actually made was that the wife's entitlement to lump sum spousal maintenance would be dependent on the extent of any property settlement. Accordingly, it was submitted that the trial Judge erred in not determining the threshold liability for spousal maintenance before proceeding to determine the quantum of maintenance. It was also submitted that in considering the application for spousal maintenance, the trial Judge erred in taking into account only the interest income that the wife could earn on her capital and not the capital itself.

1. 22.      The child support ordered by the trial Judge was also submitted to be excessive giventhe income that would be available to the husband after he had paid the wife the sum awarded to her for property settlement and lump sum maintenance.

The Reasons for the Property Settlement Decision

1. 23.      We propose to deal first with the issue of the sufficiency or adequacy of the trial Judge's reasons in relation to property settlement.

2. 24.      Following the decisions of the Full Court of this Court in Bennett and Bennett (1991) FLC 92-191, Horsley and Horsley (1991) FLC 92-205 and Bonnici and Bonnici (1992) FLC 92-272 the principles governing the need for the giving of adequate reasons for the exercise of the discretion to alter interests in property under Section 79 of the Family Law Act are well established. For present purposes they are perhaps best expressed in the following passage from the judgment in Horsley (at page 78,401):

   "... Counsel for the wife contended that the trial Judge did not give adequate or any reasons for his decision and that his failure to do so amounted to an error of law and additionally contended that his Honour's discretion had miscarried. In Bennett and Bennett (1991) FLC 92-191 the Full Court considered a similar argument (also advanced in that case by the same counsel) and after referring to a number of authorities, including Pettitt

   v. Dunkley (1971) 1 NSWLR 376, Housing Commission of NSW v.

   Tatmar Pastoral Co. Pty. Ltd. (1983) 3 NSWLR 378, Soulemezis v.

   Dudley (Holdings) Pty. Ltd. (1987) 10 NSWLR 247, Public Service

   Board of NSW v. Osmond (1986) 159 CLR 656, Palmer v. Clarke and

   Ors (1989) 19 NSWLR 158, referred to the judgment of the Full

   Court of the Supreme Court of Victoria in Sun Alliance Insurance

   Ltd. v. Massoud [1989] VicRp 2; (1989) VR 8 and in particular to the passage in the principal judgment of Gray J where his Honour said: "The adequacy of the reasons will depend upon the circumstances of the case. But the reasons will, in my opinion, be inadequate

   if:-

   a.   (a)  the appeal court is unable to ascertain the reasoning uponwhich the decision is based; or

   b.     (b)  justice is not seen to have been done.

   The two above stated criteria of inadequacy will frequently overlap. If the primary Judge does not sufficiently disclose his or her reasoning, the appeal court is denied the opportunity to detect error and the losing party is denied knowledge of why his or her case was rejected."

3. 25.           In Bennett's case the Full Court went on to say:

   "It is unnecessary to decide, in this case, whether the inadequacy of her Honour's reasons was itself an error of law requiring her decision to be set aside, in that we have already determined that the appeal should succeed on the merits. The weight of judicial authority, however, suggests that it might well amount to such an error. At the very least the failure to give adequate reasons places a duty on an appellate court to scrutinise the decision with particular care.

   In the absence of adequate reasons, the Full Court is not obliged to uphold a judgment merely because the result may be said to fall within the wide ambit of the Judge's discretion. In general, the appellate Court should be able to discern either expressly or by implication the path by which the result has been reached."

4. 26.           The Court concluded on this topic:

   "The important thing is that the appellate court must be placed in the position of being able to follow the trail Judge's line of reasoning, as must the parties, if they are to be satisfied that justice has been done."

   Approaching this case in light of those principles, which we think are equally applicable to a property case as to a custody case, we consider that it must be said that we are unable to ascertain the reasoning upon which his Honour's decision was based."

5. 27.           In the present case we consider that it should be apparent from our earlier analysis of,and quotations from, the judgment of the trial Judge that the only reasons that emerge from his Honour's judgment for his decision that the wife should receive twenty-five percent of the current net assets of the parties are:

. that although "the wife had made no contribution whatsoever to the property of the husband", she had "made fulsome contributions of a type recognised under Section 79 during the relationship of the parties, equal in value ... to those of the husband";

. that the wife had "the burden of two young children" and that this was "a most significant ongoing contribution";

. that there was "an enormous disparity" between the financial circumstances of each party; and

. that in "addressing the question of a percentage to be applied to the existing assets" regard should be had to "the extravagant expenditure of the husband since the Lotto win".

1. 28. We would have to say that we consider these reasons inadequate to explain to us, andwe would assume also to the parties to these proceedings, why the trial Judge arrived at the conclusion that the wife should receive twenty-five percent of the current net assets of the parties. We consider these reasons inadequate and also insufficient because of difficulties which we have in understanding certain of the reasons themselves, and also because of the provisions of sub-section 79(4) of the Family Law Act. We turn first to difficulties that we have with the reasons given by the trial Judge.

2. 29.           In relation to the first of the trial Judge's apparent reasons, being the "fulsome" and"equal" contributions by the wife during the relationship of the parties, we can only assume that he was here referring to the wife's contributions in the role of "principal homemaker and child-rearer" and through the work she did "in and about the home", both of which matters had been referred to in his judgment under the heading of "Contributions and Relevant Events During Cohabitation". However we cannot be certain that this is so, and in any event we consider greater analysis was needed of the conclusion that all contributions of the parties during cohabitation, being both contributions to property and to the family, were equal.

3. 30. Similarly we are uncertain as to what his Honour had in mind in describing the wife's"burden of two young children" as a "significant ongoing contribution". Because of the language used, we are concerned that he may have treated the wife's responsibility in the future for the care of the children, which is a matter that should be addressed in considering the future needs of the parties under sub-section 75(2), as a form of contribution within the meaning of paragraph 79(4)(c). The wife's care of the children in the period from separation to the hearing of the Section 79 proceedings is of course a contribution within the meaning of paragraph 79(4)(c).

31. We also consider that there should have been greater analysis by the trial Judge of the disparity, which he found to exist, between the financial circumstances of each of the parties. We consider this necessary because of the parties' respective ages, states of health, future income prospects, and also because of the orders proposed by his Honour.

1. 32.      Perhaps most importantly, however, in the circumstances of this case, we are uncertainas to the exact significance in the trial Judge's mind of what he described as "the extravagant expenditure of the husband since the Lotto win". Given the lack of any other finding, adverse of otherwise, about this matter, we are left uncertain as to whether the trial Judge considered that the husband should be penalized for some form of financial waste, or as to whether he considered that the wife should be entitled to be placed by means of the property settlement in a position where she could enjoy a similar standard of living to that of the husband. Furthermore, we do not know what difference this finding of the "extravagant expenditure" by the husband made to what would otherwise have been the percentage of the assets awarded to the wife by the trial Judge.

2. 33. Sub-section 79(4) of the Family Law Act requires a Judge, in considering what order (if any) it should make in proceedings with respect to any property of the parties to a marriage, to take into account the following matters:

   "(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;

   (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 lastmentioned 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; (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;

   d.          (d)      the effect of any proposed order upon the earning capacity of either party to the marriage;
   e. (e) the matters referred to in sub-section 75(2) so far as theyare relevant;
   f.           (f)       any other order made under this Act affecting a party to the marriage or a child of the marriage; and

   g. (g) any child support under the Child Support (Assessment) Act1989 that a party to the marriage has provided, or is to provide, for a child of the marriage."

3. 34.      Of course not all the matters referred to in sub-sections 79(4) and 75(2) are relevant inevery case. However in this case it would seem from the judgment of the trial Judge that he has only taken into account the matters of the wife's lack of contribution to the husband's property, the wife's fulsome and equal contributions during the relationship, the wife's ongoing responsibility for the children, the enormous disparity between the parties' financial circumstances, and the extravagant expenditure of the husband since the lottery win. In our view there are other matters relevant to this case which should have been taken into account. For example, we would have thought that the issue of the husband's ongoing involvement, both financial and otherwise, in the childrens' lives required some consideration, as also did the effect of the proposed property settlement order, and indeed the other proposed maintenance orders, on the husband's income-earning capacity. If the trial Judge had considered these or other matters, but had decided that they should not impact on his decision, he should have explained this.

4. 35. Furthermore we consider that the matters that the trial Judge did take into accountrequired greater examination and evaluation than he gave them. We have earlier referred to our difficulties in understanding certain of his Honour's stated reasons. In addition, however, we do not know how he arrived at the figure of twenty-five percent in light of his stated reasons. It was recognized by the Full Court in Horsley that none of the matters referred to in sub-section 79(4) and 75(2) "are capable of precise mathematical calculation".

Nevertheless the Full Court went on to say that "for the process of appeal to have any meaning at all, (the Full Court) must be afforded some guide as to the trial Judge's thinking in these areas ...", that is, the areas or matters in sub-sections 79(4) and 75(2) that are relevant in arriving at the final award in a particular property settlement case.

1. 36. In the present case, few of the matters mentioned in sub-sections 79(4) and 75(2) havebeen expressly taken into account by the trial Judge, and those that have, do not in our view explain his decision that the wife should receive twenty-five percent of the net assets. Indeed we would go so far as to say that because of the overall lack of reasoning to be found in the judgment of the trial Judge, we are unable to form a view as to whether his decision could be regarded as falling within the wide ambit of the discretion under Section 79 of the Act.

2. 37. Thus, bearing in mind the principles stated in Horsley in relation to the giving ofreasons, it is impossible for us in scrutinizing this judgment to be satisfied either that the trial Judge has not fallen into error, or that justice has been done in the case. Accordingly we must allow the appeal and we consider that there must be a re-trial. Regrettably, in our view, there is not sufficient material before us in relation to the many matters that are required to be taken into account in the exercise of the discretion under Section 79 to enable us to re-exercise that discretion. Other Matters

3. 38.      Given our decision to allow the appeal on the ground of insufficient reasons for the decision in relation to property settlement, it is unnecessary for us to deal with the other grounds of appeal in relation to the property settlement order. In particular it is unnecessary for us to determine whether the trial Judge's alleged failure to follow without explanation the approach preferred by Full Court authority (see, for example, Ferraro and Ferraro [1992] FamCA 64; (1993) FLC 92-335) to the determination of property settlement applications amounts of itself to an error of law. That approach requires a consideration of the contributions of the parties under paragraphs 79(4)(a) to (c) of the Act, followed by a separate consideration of the matters in paragraphs 79(4)(d) to (g), including the matters contained in sub-section 75(2). In relation to this matter we would say only that we consider that, in the particular circumstances of this case, where most of the property available for distribution between the parties had resulted from a post-separation lottery win by the husband, it was particularly important that the trial Judge explain how he proposed to divide that property, and that he do so on the basis first of the contributions of the parties to property and to the welfare of their family during the period of cohabitation and during the period between separation and trial, and then on the basis of the matters referred to in paragraphs 79(4)(d) to (g), which include not only the matters referred to in sub-section 75(2), but also the effect of any property settlement order on the husband's earning capacity, as well as the effect of all other proposed orders. The trial Judge's failure to assess and evaluate first the parties' various contributions, and then to assess and evaluate the matters contained in sub-section 75(2) (notably the matters of the "enormous disparity" in the parties' financial circumstances and the "extravagant expenditure" of the husband since the lottery win, which were both clearly matters of concern to the trial Judge), and the effect of the proposed order on the husband's income earning capacity, has resulted in this appellate court being unable to ascertain why the trial Judge decided to award to the wife twenty-five percent of property, which largely comprised assets and investments acquired as a result of a post-separation windfall to the husband.

4. 39.      Similarly, in view of our decision to allow the appeal in relation to the orders for propertysettlement and to order a new trial of that matter, it is unnecessary to determine this appeal so far as it relates to the orders for spousal maintenance and child support. Those matters will have to be re-determined in the light of the further determination for property settlement division.

5. 40.      In setting aside the order appealed against, we consider that it would also beappropriate to set aside the other orders made by the trial Judge in relation to property settlement, being the orders in relation to chattels and indemnities. It would seem appropriate that new orders be made in relation to these matters following the re-hearing of the property settlement matters.

Costs

41. At the conclusion of the hearing of the appeal, we heard submissions on the question of the costs of the appeal. If the appeal was successful, both parties sought certificates pursuant to the provisions of s.9 and s.6 of the Federal Proceedings (Costs) Act 1981. We consider it appropriate to grant such certificates.

Orders

42. We would therefore order:

1. That the appeal be upheld.

2.   2.    That the orders of 28 May 1993 be set aside.

3.   3.    That the matter be remitted for re-hearing before a single Judgeof this Court.

4.   4.    That the Court grants to the appellant husband a costs

certificate pursuant to the provision of s.9 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under this Act to the appellant husband in respect of the costs incurred by the appellant husband in relation to the appeal.

2. 5. That the Court grants to the respondent wife a costs certificatepursuant to the provision of s.6 of the Federal Proceedings

(Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under this Act to the respondent wife in respect of the costs incurred by the respondent wife in relation to the appeal.