Miley & Miley
[2024] FedCFamC1F 5
•19 January 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Miley & Miley [2024] FedCFamC1F 5
File number: MLC 5852 of 2021 Judgment of: MCGUIRE J Date of judgment: 19 January 2024 Catchwords: FAMILY LAW – PROPERTY SETTLEMENT – application by wife for the alteration of property interests - - wife seeks a 65/35 per cent distribution of the property in her favour with a 15 per cent loading to her on account of asserted superior contribution – husband seeks a 55/45 per cent alteration of the parties property interest in his favour with a 5 per cent loading on account of relevant s 75(2) of the Family Law Act 1975 (Cth) factors – orders that there be a 50/50 per cent division of the parties net property where the Court is satisfied in the circumstances that the division is just and equitable giving proper consideration and weight to their various contributions and the current circumstances of each Legislation: Evidence Act 1995 (Cth) s 140
Family Law Act 1975 (Cth) ss 75(2), 79
Cases cited: Briginshaw & Briginshaw (1938) 60 CLR 336
Fox v Percy (2003) 214 CLR 118
Galea & Galea (1990) 19 NSWLR 263
Hickey & Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143
In the Marriage of Albany v Albany (1980) FLC 90-905
In the Marriage of Brandt v Brandt (1997) FLC 92-758
In the Marriage of Garrett v Garrett (1984) FLC 91-539
In the Marriage of McDougall v McDougall (1976) FLC 90-076
Jabour & Jabour (2019) FLC 93-898, [2019] FamCAFC 78
Omacini v Omacini (2005) FLC 93-218; [2005] FamCA 195
R v Watson; Ex parte Armstrong (1976) 136 CLR 248
Re: F Litigants in Person Guidelines (2001) FLC 93-072
Stanford & Stanford (2012) 247 CLR 108
Division: Division 1 First Instance Number of paragraphs: 86 Date of last submissions: 6 November 2023 Date of hearing: 1, 2 and 3 November 2023 Place: Melbourne and Hobart, delivered in Sydney Counsel for the Applicant: Ms Borg Solicitor for the Applicant: McDonald Slater & Lay Solicitor for the Applicant: Litigant in Person ORDERS
MLC 5852 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS MILEY
Applicant
AND: MR MILEY
Respondent
ORDER MADE BY:
MCGUIRE J
DATE OF ORDER:
19 JANUARY 2024
THE COURT ORDERS THAT:
1.The net property pool of the parties inclusive of superannuation entitlements be distributed as to 50 per cent to the husband and 50 per cent to the wife in accordance with these Orders.
2.Within sixty (60) days from the date of this Order the respondent Mr Miley (“the husband”) shall transfer to the applicant Ms Miley (“the wife”) all his right, title and interest in the property situate at B Street, Suburb C in Victoria and the wife shall be solely responsible for the payment of all amounts payable in respect of any mortgage payments for the property and all rates, taxes, insurances and any other outgoings and shall indemnify and keep indemnified the husband.
3.Contemporaneously with the transfer of the property in Order 2 herein the wife shall pay to the husband the sum of $1,382,169.50.
4.Should the wife be unable or unwilling to make a cash adjustment to the husband as set out in Order 3 above then the parties or either of them have leave to apply to the Court for orders for the sale of either or both of the properties situate and known as B Street, Suburb C in Victoria and D Street, Town E, Region T in the United Kingdom.
5.The wife shall retain the following to the exclusion of the husband:
(a)D Street, Town E, Region T in the United Kingdom and the wife shall be solely responsible for the payment of all amounts payable in respect of the mortgage payments for the property and all rates, taxes, insurances and any other outgoings and shall indemnify and keep indemnified the husband in respect of any other liability including but not limited to any tax liability associated therewith and provide the husband with a discharge of his obligations under any such mortgage within sixty (60) days of the date of these Orders.
(b)the F Bank UK bank account in her sole name;
(c)the Westpac bank accounts in her sole name;
(d)all personalty and chattels in the possession or control of the wife;
(e)Motor Vehicle 1 in her possession;
(f)any superannuation entitlement of the wife; and
(g)her interest in Superannuation Fund 1.
6.The husband shall retain the following to the exclusion of the wife:
(a)the G Bank accounts ending in #...82 and # …71 and the ANZ bank account (Estate of Ms H);
(b)Motor Vehicle 2 in his possession;
(c)Motor Vehicle 3 in the possession of the parties’ son;
(d)the recreational vehicle in his possession;
(e)his shares in any public listed companies;
(f)his superannuation entitlement;
(g)his interest in Superannuation Fund 1; and
(h)all personalty and chattels in the possession or control of the husband.
7.The wife sign all documents and do all such things as may be required to transfer to the husband all her right, title and interest in the following entities and the husband indemnify the wife in respect of any liability whatsoever, including but not limited to tax liability, past present and future relating thereto:
(a)J Pty Ltd;
(b)K Pty Ltd; and
(c)L Pty Ltd as trustee of the Miley Family Trust and the wife resign as appointer of the trust and any other office she holds;
8.The parties sign all documents and do all things as may be required to rollover, rollout or transfer to the wife’s member balance in the self-managed Superannuation Fund 1 (the “SMSF”) to a superannuation fund of the wife’s choosing in accordance with Regulation 7A.12 of the Superannuation Industry Supervision (Regulations 1994) (Cth) at the husband’s expense.
9.Upon giving effect to the rollout or transfer of the wife’s interest in the SMSF, the wife resign as director and office holder of M Pty Ltd as trustee of the SMSF and the husband indemnify the wife in respect of any liability whatsoever, including but not limited to any tax liability, past present and future in relation thereto.
10.Unless otherwise specified in these orders and except for the purposes of enforcing the payment of any monies due under these or any subsequent orders:
(a)each party be solely entitled to the exclusion of the other to all property, including choses-in-action, in the possession of such party, as at the date of these Orders;
(b)the parties do all things and sign all documents to forthwith close all joint accounts and any monies standing to the credit of the parties in those joint accounts shall be distributed as to 50 per cent to the husband and 50 per cent as to the wife;
(c)the parties do all things and sign all documents to forthwith close the joint account with a debit of approximately $1,500 and the wife will be responsible for payment of that amount in order to close the account;
(d)monies standing to the credit of the parties in any bank account shall remain the property of the account holder;
(e)all insurance policies remain the sole property of the owner named thereon;
(f)each party foregoes any claim they may have to any superannuation benefit that is belonging to or owned by the other save as provided for in these Orders;
(g)each party be solely liable for and indemnity the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders; and
(h)any joint tenancy of the parties in any real or personal estate is expressly severed.
11.There be liberty to the parties to apply to the Court generally in respect of the execution of these Orders.
12.Pursuant to s 81 of the Family Law Act 1975 (Cth) the parties intend that these Orders shall as far as practicable finally determine the financial relationship between them and avoid further proceedings between them.
13.All extant property and financial applications be dismissed except costs applications between the parties, if any, which are to be dealt with in accordance with the Family Law Rules 2021 (Cth).
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym of Miley & Miley has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
MCGUIRE J:
APPLICATIONS
Ms Miley (“the wife”) is the applicant in property proceedings. Where the orders and percentage distribution she sought varied throughout the proceedings, by the end of the trial she was asking for 65 per cent of the property pool inclusive of superannuation where I am asked to deal with superannuation and tangible assets on a “one pool” basis.
The wife has been represented by solicitors and by counsel at the trial.
Mr Miley (“the husband”) had previously been represented by solicitors. However, he represented himself at the trial. He did so in a professional, competent and courteous fashion where the husband was obviously well-versed on the major issues before the Court and well‑prepared in his arguments.
The husband seeks orders, also on a one pool basis, whereby he received 55 per cent of the net property pool.
BACKGROUND FACTS
The husband is 63 years of age and the wife is 55 years.
The wife says that the parties commenced cohabitation in 1999 and married in 1999. The husband agrees in his affidavit material that the parties married in 1999 but says that they commenced cohabitation in 2000. In the circumstances, nothing turns on this minor discrepancy.
The parties separated on 1 October 2018. It follows that cohabitation was of some 19 years duration.
There are two adult children of the marriage namely Mr N (aged 22 years) and Ms P (aged 20 years). Both children are independent but where Mr N continues to live with the husband and Ms P continues to live with the wife and where each of the parties claims some continuing responsibility for the support of the respective children.
The husband worked with Q Company through the relationship until 2016. Where he says that he worked in “sales”, the husband’s evidence showed him to have a detailed knowledge of the relevant industry.
As long ago as 2011 the parties registered a company, K Pty Ltd. The husband is the sole director. The parties are equal shareholders.
J Pty Ltd was registered in 2016. I understand it to be a consulting business. The husband is the sole director. He holds 32 shares. The wife holds 10 shares. Two other parties each hold 18 shares. L Pty Ltd holds 10 shares. L Pty Ltd is the Trustee of the Miley Family Trust which seems to be the dominant entity for the parties’ day-to-day business. An interim order sees the husband having recent control of the business entities.
The wife also has skills and experience in the same industry and holds a tertiary qualification. She continues to work as a consultant outside the parties’ business and where the income from the business entities is directed to the husband in the interim.
THE ISSUES
Final submissions of counsel for the wife and the submissions of the husband in person suggest that the property pool in respect of contents and valuation is essentially agreed with a few minor remaining disputes.
The parties disagree as to the nature and impact of each of their initial financial contributions.
Submissions suggested that the husband might argue a superior financial contribution during the course of the relationship but where his submissions, put in a general sense, are that there should be no adjustment overall on the basis of contributions.
The parties each argue for adjustments specifically referenced to s 75(2)(o) of the Family Law Act 1975 (Cth) (“the Act”) broadly, and often without specificity, on account of alleged “wastage” or dissemination of assets and on account of the paid legal costs.
The husband argues for an adjustment on account of the relevant s 75(2) factors and particularly in respect of his health and hence his ongoing employability relative to that of the wife.
In summary, therefore, the wife argues for a 65/35 per cent distribution of the assets in her favour with a 15 per cent loading to her on account of asserted superior contributions. The husband argues for a 55/45 per cent alteration of the parties’ property interests in his favour with a 5 per cent loading on account of the relevant s 75(2) factors.
THE RELEVANT LAW
The Act at s 79 gives the Court the power to alter the interests of parties in property. “Property” is to include assets and liabilities and later amendments to the Act provide that “superannuation may be treated as property” although, often not capable of being crystallised in the sense of a tangible asset.
The discretion at s 79(1) is a broad one but limited by the statute itself where the section provides:
(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
…
Importantly, however, the broad discretion is only within the statutory parameters. In R Watson; Ex parte Armstrong[1] the High Court observed:
… The judge called upon to decide proceedings of that kind is not entitled to do what has been described as “palm tree justice”. No doubt he is given a wide discretion, but he must exercise it in accordance with legal principles, including the principles which the Act itself lays down…
[1] (1976) 136 CLR 248 at 257.
Following the important decision of the High Court in Stanford & Stanford[2] emphasis has returned to the Court being satisfied pursuant to s 79(2) of the Act that a Court should not make an order under this section unless it is satisfied, in all the circumstances, that it is just and equitable to do so. In so doing, the Court moved away from a previously understood structured “four step approach”.[3] Nevertheless, the steps in the process of consideration and determination remain valid where the Court must first determine the contents of the property pool and attribute value to those contents and hence the pool itself. With this base, the Court determines the question at s 79(2). If appropriate to move on in its consideration then the Court takes into account the contributions by or on behalf of the parties to the acquisition, conservation, or improvement of any of the property of the parties or either of them. Contributions may be of a direct or indirect financial type. Alternatively, contributions may be of a non-financial type including as homemaker and parent.
[2] (2012) 247 CLR 108.
[3] Hickey & Hickey and Attorney-General for the Commonwealth of Australia (2003) FLC 93-143.
The task for the Court here is to assess, weigh and balance the various contributions in circumstances where the Court is not required to provide a precise mathematical audit of the marriage but rather to deal with such matters in a holistic sense.[4]
[4] In the Marriage of Brandt v Brandt (1997) FLC 92-758; In the Marriage of Garrett v Garrett (1984) FLC 91-539.
Generally, where the Court in its discretion may take what is known as an “asset-by-asset” approach in assessing contributions to individual items of property, the preferred approach is the “global” one based on an assessment referenced to the totality of assets to be divided. In the matter now before me where the marriage is of long duration and where the contributions by the parties have been many and mixed, it is my view that the global approach is entirely appropriate.
After considering the contribution issues, the Court then turns to consider whether it be proper, just and equitable to make any further adjustment to either of the parties on account of any relevant matters set out at s 79(d) – (g) of the Act including the factors at 75(2) where relevant matters here might include the age and state of health of each of the parties, income earning capacity, and whether or not any of the parties has the responsibility for the care and support of the another person including any dependent minor children.
The entire process of consideration and determination is permeated with an understanding of justice and equity.
THE EVIDENCE
Where there are issues of disputed fact and credit between the parties, the Court is called upon to make findings of fact which it does so on a standard of on the balance of probabilities consistent with s 140 of the Evidence Act 1995 (Cth) which provides in respect of civil proceedings:
(1)In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.
(2)Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account:
(a) the nature of the cause of action or defence; and
(b) the nature of the subject-matter of the proceeding; and
(c) the gravity of the matters alleged.
The rationale of enshrining the standard of proof in statute can be seen in the oft quoted passage of the High Court (Dixon J) in Briginshaw v Briginshaw:[5]
…when the law requires the proof of any fact, the tribunal must feel an actual persuasion of its occurrence or existence before it can be found. It cannot be found as a result of mere mechanical comparison of probabilities independently of any belief in its reality. … it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal.
[5] (1938) 60 CLR 336 at 361-362.
Put simply, a party making an assertion of fact carries the onus of proof to the standard of on the balance of probabilities.
In matters such as that now before me where there are numerous issues of disputed fact and credit and where often corroboration in the form of independent evidence or documents are not available, the Court has the benefit of seeing and hearing the parties give their evidence and be cross-examined. In Galea & Galea[6] Kirby AJC considered the advantages available to trial judges including the following:
(a)The hearing of the evidence in its entirety.
(b)Hearing and seeing all evidence in context, chronologically and logically advanced.
(c)Having time during adjournments and during the running of the case to reflect upon the evidence and to weigh against all other evidence whilst fresh.
(d)Hearing and seeing interruptions, hesitations and delays in the giving of testimony.
(e)Observing body language sometimes important for interpreting communication.
[6] (1990) 19 NSWLR 263.
Nevertheless, the authorities also make it clear that the Court should be aware of the pitfalls of giving too much credence solely to the demeanour of a party or witness when considering the veracity of the evidence.[7] Notably, in the matter before me, the wife had the advantage of solicitors and counsel whereas the husband was self-represented in the conduct of the trial. He was in an unfamiliar environment in the court room. Parties are likely to be nervous, restrained and careful in giving their evidence unless they fall into error or accidental disclosure. Similarly, as appears to be common in family law matters, parties in their evidence are always keen to shore up their own case whilst emphasising the negative of the other party’s case.
[7] Fox v Percy (2003) 214 CLR 118, [2003] HCA 22.
THE WIFE
The wife relied on her trial affidavit affirmed 9 January 2023 and affidavits in reply affirmed 23 January 2023 and 19 October 2023. She also relied on a financial statement sworn 9 January 2023. Whilst it was explained to the husband that he had the right to object to any parts of the wife’s affidavit material which infringed the Rules of Evidence, unsurprisingly he had difficulty in grasping the notion and offered objections on the basis of his dispute of fact. As such, it was determined, with the agreement of counsel for the wife, that the Court would accept the affidavits into evidence but apply appropriate weight where such material did infringe the Rules of Evidence.
The wife gave her evidence in a confident, informed and straightforward manner. Whilst she did not retreat under relatively vigorous cross-examination by the husband, she was prepared to make admissions against interest where appropriate. I saw the wife as a good historian and also as a person well-versed in her industry and, in particular, where she gave evidence consistent with her assertion that she played an ongoing, active and professional part in the running of the company’s business entities.
THE HUSBAND
As the husband was self-represented, the Court spent some considerable time taking him through the process and procedure of the trial and providing him with an open invitation to ask questions at any time about procedure as well as providing him with copies of the relevant parts of the Act.[8]
[8] Re: F Litigants in Person Guidelines (2001) FLC 93-072.
The husband relied on affidavits affirmed or sworn 16 January 2023, 21 June 2023, and 31 October 2023 with the latter being primarily in response to the wife’s trial affidavit. He also relied on an amended financial statement sworn 16 January 2023. Again, counsel for the wife did not take specific objection to parts of the husband’s affidavits on the basis that the Court would attribute appropriate weight.
The husband presented in both his cross-examination of the wife and under cross-examination himself in the witness box as confident and assertive of personality. Like the wife, he appeared informed as to the issues including the nature of the business entities run by the parties.
The husband’s lengthy cross-examination of the wife was often repetitive but where understandably he was keen to shore up issues he saw favourable to him and to downplay the wife’s contributions relative to his own. Without criticism, and as is common with unrepresented litigants, the husband’s cross-examination frequently lapsed into issues of specificity and personal to the parties which was of limited assistance to the Court’s consideration and determination. Nevertheless, and whilst always assertive in his presentation, the husband was at all times courteous to his former wife, to the Court, and to counsel.
When cross-examined, the husband was equally assertive and keen to emphasise his own case whilst downplaying the position of the wife. He tended to be elaborate in his responses and often deflected from the question. I also saw the husband as a good historian with some detailed recollection. As with his cross-examination of the wife, the husband, whilst argumentative at times, was at all times courteous to counsel and the Court.
DR S
The husband adduced evidence from Dr S who provided an affidavit affirmed 19 January 2023. Dr S was not required for cross-examination. His affidavit sets out his curriculum vitae, a letter of instruction from the husband’s then solicitors, and a medical report dated 10 January 2023.
Dr S is a consultant surgeon. He reports receiving a referral for the husband in mid-2020 following an “[injury]” within a setting of “well controlled [medical condition]”.[9]
[9] At page 1 of the Report and page 17 of his affidavit.
Dr S’s reports x-rays exposing:[10]
Mildly displaced [injury] is demonstrated with accompanying mildly displaced [injury] and mildly displaced [injury].
[Structure] is unstable.
On the lateral view, [condition seen] likely in keeping with old [injuries].
However clinical correlation is recommended.
[10] At page 1 of the Report and page 17 of his affidavit.
The Dr S describes the husband as a “very intelligent [professional] who led a very active lifestyle… He enjoyed hiking and trying to stay fit knowing the possible complications of [his medical condition]”.[11]
[11] At page 1 of the Report and page 17 of his affidavit.
Dr S diagnosed the husband having a condition, a complication of his chronic medical condition that can lead to a rare but serious complication.
The husband disclosed having had an infection leading to surgery in 2019.
Dr S then sets out a comprehensive medical history for the husband including frequent recent hospitalisation. Dr S gives a prognosis as follows:[12]
I feel that [the husband] will have limited mobility in the future as his prognosis is poor with further complications […] highly likely. He will need better control of his [medical condition], [and further care]. If he has a [procedure] he may require a mobility [aid].
…
I think it is highly likely that [the husband] will need to have further medical care and subsequent hospitalisations. […]. He would need help […] and certain tasks that he enjoys such as hiking would be very difficult if not impossible. He will need mobility aids […].
…
In my opinion it is highly likely that [the husband] will struggle to procure and persist with paid employment due to his [medical condition] and poor mobility due to the complications he has already experienced and the subsequent sequelae of events which we know are a natural history of such a destructive condition.
[12] At page 5 of the Report and page 21 of his affidavit.
MS R
Ms R is a certified accountant and Forensic Accounting Specialist. She has provided two affidavits as single expert with the first of 8 June 2022 annexing her valuations of J Pty Ltd and Miley Family Trust. A second affidavit of 30 May 2023 provides updated valuations.
Ms R was not required by either party for cross-examination and her affidavits were read into evidence accordingly.
Where the parties agree the value of J Pty Ltd and the Miley Family Trust (L Pty Ltd trading as K Pty Ltd) together at $332,144 and noting that Ms R was not required for cross‑examination, it suffices for me to note that Ms R’s reports are comprehensive in detail and explanation and address material and queries provided and put to her by each of the parties.
THE PROPERTY POOL
Despite initial indications of significant disagreement between the parties in respect of both major and minor valuations, by the end of the evidence, and perhaps with the assistance of cross-examination of both parties, there is now substantial agreement between the parties as to the content of the property pool and the values to be attributed.
Unfortunately, and as appears frequently in matters coming before these courts, there is a dearth of evidence in proper form to corroborate the estimates of each of the parties of disputed value of items such as motor vehicles. To their credit, however, each of the parties in final submissions have suggested that the Court might simply attribute a mean value where a dispute remains and therefore where I now have a licence accordingly then I intend to take this approach as an exercise in efficiency but where I am patently aware of historical Full Court authority arguing against such a methodology of valuation. In reality, however, and as against the total value of the property pool, it would be a costly exercise to now adjourn the matter and put the parties to the added expense of formal valuations.
The husband unilaterally “gifted” Motor Vehicle 3 to his adult son. Where the wife neither concedes nor accepts this transaction then the vehicle must remain the property of the husband for these purposes.
Given the above concessions of the parties and their proper agreement, I find the property pool to comprise of the following:
Property Value 1. B Street, Suburb C, Victoria $2,500,000 2. D Street, Town E, Region T UK (£1,050,000) $1,998,846 3. J Pty Ltd ($17,015) and Miley Family Trust (L Pty Ltd trading as K Pty Ltd) ($315,129) as per expert valuation $332,144 4. The wife’s Westpac Bank account $1,472 and the wife’s Westpac Bank account (including inheritance from father of $15,943) $16,743 $18,215 5. The wife’s F Bank account (UK) $60,174 6. The husband’s G Bank account # …82; G Bank account # …71 and ANZ bank account (Estate of Ms H) $15,343 7. The husband – shares in publicly listed companies as at 17 April 2023 $301,763 8. The wife – Motor Vehicle 1 (mean of estimates) $50,000 9. The husband – Motor Vehicle 2 (mean of estimates) $62,500 10. Motor Vehicle 3 in possession of son (mean of estimates) $27,250 11. husband – recreational vehicle $30,000 Total property $5,396,235.00
Liabilities Value 1. Mortgage loan UK property – (£58,855) $113,178 2. Joint account (-$1,500) Total liabilities $114,678
Superannuation Value 1. Superannuation Fund 1 – wife’s interest (30 June 2023) $322,244 2. Superannuation Fund 1 – husband’s interest (30 June 2023) $998,747 3. Superannuation Fund 2 – husband $302,715 Total superannuation $1,623,706
The total net tangible assets of the parties is of value $5,281,557. The total superannuation of the parties is $1,623,706. The total net property of the parties including superannuation is of value $6,905,263.
CONTRIBUTIONS
As of the date of commencement of the relationship the wife had equity in a home unit at U Street, Suburb C in Victoria (“the U Street property”). She had purchased the property in 1992 for around $130,000. The mortgage as at the date of cohabitation was $94,847. The property was sold in 2003 netting some $365,000. By this stage both parties had been living in the U Street property. Each party had made various contributions towards the relationship. The U Street property was sold some four years after the commencement of cohabitation. I accept that the wife had some equity in that property which in turn contributed to the various purchases including B Street, Suburb C which is maintained to this day.
The wife also had a motor vehicle, some small savings, and some superannuation.
These initial contributions are seen within the context of the length of the relationship and the plethora of subsequent contributions made by each of the parties.[13]
[13] In the marriage of Albanyv Albany (1980) FLC 90-905; In the marriage of McDougall v McDougall (1976) FLC 90-076.
Where counsel for the wife argues for some “springboard” effect from the wife’s equity in the U Street property, the Court is cautious and considers the comments of the Full Court Jabour & Jabour[14] noting that property contributions cannot be “quarantined” against the preferred holistic approach to the pool and contributions. The Full Court considered favourably an earlier Full Court decision in Dickons & Dickons[15] and said at [61]:
… the Court expressly rejected the notion that there must be a relationship between contributions and what they produced in terms of property.
[14] (2019) FLC 93-898, [2019] FamCAFC 78.
[15] (2012) 50 Fam LR 244, [2012] FamCAFC 154.
That is, the Court would fall into error by searching for any nexus between an initial contribution and the present value and particularly so in a relationship now of some 20 years duration where the Court is to weigh the myriad of contributions made by the parties against and in the context of initial contributions.
The evidence suggests that the wife underplays or underestimates the husband’s financial position as at the commencement of the relationship. I am satisfied that he brought with him substantial long service leave entitlements together with cash savings of approximately $21,000 and shares then valued at $3,600. Significantly, the husband was then a 50 per cent shareholder in L Pty Ltd as trustee for the Miley Family Trust. His parents, now both deceased, were the other shareholders. I also accept that the husband had a financial beneficial interest in the “ANZ Imputation Trust”.
Whereas there is a tendency in the husband to emphasise the gross value of various assets where they also carry liabilities, his introduction of an interest in L Pty Ltd/Miley Family Trust, now sits at value in the property pool at $332,144 noting that whilst the original trust entity served as an investment device for the husband’s late mother, it also owned real property. This is a valuable contribution by the husband although to be considered as an “initial” contribution with the same caveat as above in relation to the wife’s initial contribution.
Documents produced by the husband evidence his superannuation entitlement as at 31 December 2000 to be $180,034.
I also accept, as unchallenged, the husband’s evidence that he owned two motor vehicles then with a total value of approximately $35,000.
During the course of the relationship both parties worked hard and to their potential. Whereas they each underplay the roles and importance of the other in their various business enterprises, I prefer that each contributed significantly and substantially. In addition, there are two children of the relationship and where the husband graciously concedes that the wife was more occupied in the role of homemaker and parent. I expect, however, that in doing so the wife freed the husband to pursue not only his ongoing employment with Q Company but his contemporaneous contributions to the parties’ enterprises.
During the course of the parties’ relationship, the husband’s mother passed and he became the sole beneficiary of the L Pty Ltd/Miley Family Trust effectively receiving the further 50 per cent interest. Again, this is a significant contribution in both its dollar value and ability to permit the parties effective and efficient operation of their businesses.
The other significant injection during the course of the relationship was the wife’s inheritance of a property at Region T, United Kingdom (“the UK property”). The tendency of each of these parties is to emphasise or inflate each of their contributions as evidenced by the wife’s contention that the UK property then had a value of £385,000. Properly in cross-examination the wife conceded a second valuation and indeed a declaration to the United Kingdom authorities of value of £300,000. Nevertheless, this was a significant financial windfall by way of an inheritance for the wife albeit as long ago as 2008. The wife also received an additional cash element of some £80,000. Significantly, however, is that the present value of the UK property in the balance sheet evidences the subsequent contributions by the parties. Monies were borrowed for renovations and whilst perhaps borrowed in the wife’s name, the husband’s relatively high income and stability was required and used for security. Further, the parties contributed significantly from their own earnings towards the maintenance or restoration of this property.
Whilst the evidence is in many ways vague and uncertain, I also accept that each of the parties obtained some further inheritances and gifts from family members during the course of the relationship. Notably, the husband’s unchallenged evidence is that he received an inheritance in 2001 of $58,297 which was put towards the balance of the U Streer mortgage loan. I am also satisfied that the parties benefited by the largess of the husband’s mother prior to her demise but noting too the efforts by the wife in the personal care of and attendance to the financial affairs of the husband’s mother during her latter years. The parties self-managed superannuation fund now clearly manifests some of the contributions made on behalf of the husband through his mother or perhaps L Pty Ltd.
In their evidence each of the wife and the husband emphasise their contributions, firstly by the wife of the UK property at £300,000 (together with her cash bequest of £80,000) and, in the husband’s case, the beneficial interest of the remaining 50 per cent shareholding in L Pty Ltd/Miley Family Trust. Superficially, the value of the UK property now sits in the pool at $1,998,846 and the Miley Family Trust (L Pty Ltd) at the relatively lower $332,144, but it would be a mistake to consider these current values in isolation in respect of the contributions of the parties. Firstly, the wife’s contributions was received in 2008 some eight or so years prior to the husband’s bequest of the remaining 50 per cent share in L Pty Ltd. Secondly, and importantly, the parties agree that substantial contributions by the parties themselves towards the UK property were made subsequent to its inheritance by the wife. Thirdly, and consistent with the authorities, it is not for the Court to consider each of these “assets” in isolation. They must be considered in the context of and the fact of the myriad of contributions made by and on behalf of these parties during the course of this relationship which extends from 1999. Those other contributions should not be neglected in their impact on the parties’ current wealth whilst also considering the value, then and now, of the injection of the UK property and the husband’s further 50 per cent interest in L Pty Ltd. Such is the holistic approach of courts to the consideration of contributions. Each of the parties claims some post-separation contributions. Specifically, the husband has maintained the management of the business entities. However, it is noted he has also had the financial benefits of the business.
Each of the parties claims a post-separation contribution towards the now adult child living with each of them.
Each of the parties criticises the other in respect of some downturn in the value of the business enterprise. However, in this matter and as mentioned above, I consider it proper and preferable to consider such issues of alleged “wastage” and/or benefits received by a party prior to the trial and post separation under s 75(2)(o) of the Act.
This is a long relationship now extending from 1999. The parties have been successful as evidenced by the value of the property pool. Certainly, their wealth has increased substantially during the course of their relationship.
I accept generally that the husband had interests and beneficial interests as at the date of commencement of cohabitation all of which had some value although I am unable to determine with any precision the dollar value of his interests at that time. Similarly, I know that the wife had equity in the U Street property. I do not know the value of the property as at the date of commencement of cohabitation only its sale price some four years later. Importantly, in respect of the emphasis put on initial contributions by each of the parties, is the flux of time and, even more importantly, the myriad of contributions which have benefited the parties during the course of their relationship and again seen within the context of their current wealth.
I take into account the injection of funds from the wife’s inheritance in 2008 totalling some £380,000, but also the benefit of the husband’s inheritance of 50 per cent value of L Pty Ltd/Miley Family Trust. Each of these have given an impetus towards the wealth the parties have today, and as the husband points out, notably in the value of Superannuation Fund 1.
In respect of superannuation, I accept that the husband had substantially superior superannuation entitlements at the date of commencement of cohabitation than did the wife.
I accept that both parties have contributed to the financial support and care of their now adult children since separation.
Taking all of the above matters into account and with particular emphasis on the length of the relationship, the husband’s superior superannuation entitlement at the date of commencement of cohabitation, and noting the fact, effect and the impact of the wife’s contribution of the UK property and the husband’s contribution of the 50 per cent remaining shares in L Pty Ltd, and within the context of the myriad of contributions, I am of the view that there should be no adjustment to either of the parties on account of contributions.
SECTION 75(2) FACTORS
The husband is 63 years of age and the wife 55 years. I take into account the affidavit and assessment by Dr S of the husband. Undoubtedly, the husband carries a number of afflictions which prima facie would effect his employability leaving aside his age. Nevertheless, the husband impressed me as an astute business person and one skilled in his particular area. Put simply, and despite his attempts to underplay actual and potential income, the husband conceded an income for the previous financial year of approximately $140,000.
Whilst the wife is younger than the husband and also pleads a lack of alternative experience in the workforce by reason of her prioritising homemaker and parenting responsibilities and her work in the particular business operated by the parties, she now concedes a considerable income from her consultancy activities. Whilst I accept that there may not be consistency in income from such sources, there is every indication of her ability to earn at least the income now conceded by the husband and perhaps more.
In any event, each of these parties will have a base of some considerable wealth, including superannuation, from the alteration of their property interests by reason of these applications.
I accept for the purposes of s 75(2)(o) that the husband has withdrawn amounts of $39,848 and E$34,000 from his superannuation fund post separation. Given my comments as to the husband’s income and his astute business skills, I am given neither any detail as to the discrete expenditure of these monies nor the necessary expenditure of these withdrawals. As such, and when challenged as to such expenditure being “reasonable”, the husband has not shown full “reasonableness”.[16]
[16] Omacini v Omacini (2005) FLC 93-218; [2005] FamCA 195.
Each of the parties essentially accuses the other of a downturn in the value and profitability of the parties’ business. The husband alleges in his Case Outline that the wife made unauthorised payments to another person in a substantial quantum of some $353,436. This allegation was neither pursued by the husband in cross-examination nor was the asserted beneficiary of the funds brought to court. I cannot make a finding in accordance with the husband’s allegation.
The husband did, however, spend some time in cross-examination on his allegation that the wife caused the downturn of the business by not consenting to a subletting arrangement proposed by the husband. He says that this caused a loss of income. However, pursuit of the matter through cross-examination and the tender of correspondence between the wife’s solicitors and the husband’s then solicitors suggest that the wife was amenable to a sub lease, but conditional upon the husband first making payments outstanding in respect of the superannuation fund where it is obviously proper and to the benefit of each of the parties that such a fund be compliant. I accept the wife’s evidence that the fund was effectively non‑compliant at the time of these negotiations. As such, the wife cannot be criticised in making her conditional acceptance of the husband proposal.
Further, and perhaps dubiously considered under s 75(2)(o) is the wife’s ongoing beneficial interest in the UK property. The husband made much of the wife’s receipt of rentals and perhaps bringing her in dollar terms some $1,000 per week but where the wife quite properly reminds the Court that she has ongoing liabilities from her ownership and leasing of the property. Nevertheless, my calculations from the wife’s own sworn financial statement suggests that her ownership of the UK property is “positively geared” if not in the quantum anticipated by the husband. Where I am again not required to conduct a mathematical audit of these parties’ marriage or financial situation, I prefer that the wife’s ongoing benefit from the UK property to be a financial resource available to her which might set off her claims of a negative contribution by the husband of the near $75,000 removed by him from his superannuation fund without adequate explanation as to its expenditure.
In all of those circumstances, I propose to make no adjustment to either of the parties on account of considerations under s 79(4)(d) – (g) including s 75(2) of the Act.
CONCLUSION
In all the circumstances, therefore, I am of the view that a 50/50 division of the net property of the parties is just and equitable giving proper consideration and weight to their various contributions and the current circumstances of each. Given the parties ages and, in particular, the fact that the husband is at an age where his superannuation entitlement may be crystallised, and where the relationship was a long one with the above-mentioned myriad of contributions towards the parties’ wealth generally, I propose that superannuation be treated in the same pool as the tangible assets.
I note that the parties prefer an order that the husband retain the benefit of the self-managed Superannuation Fund 1and a splitting order will be made in respect of the wife’s entitlement.
The orders contemplate the wife retaining the two pieces of real property as was her case, where, however, this will require a cash adjustment on the husband of $1,382,169.50. I will give leave for the parties or either of them to return if the wife is unable or unwilling to make such cash payment.
I certify that the preceding eighty-six (86) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice McGuire. Associate:
Dated: 19 January 2024
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