Mr C v Ms B

[1986] FamCA 70

[1986] FamCA 70

FAMILYLAWACT 1975

IN THE FULL COURT

OF THE FAMILY COURT OF AUSTRALIA AT PERTH

APPEAL NO.  2 of 1986

IN THE MARRIAGE OF:

MR C

AND

(Appellant)

MS B

(Respondent)

BEFORETHE FULL COURT OF THE FAMILY COURT

ONTHE 19TH & 20TH MARCH 1986

(CORAM: JOSKE, BUTLER & NYGH JJ)

APPEARANCES: MR. C

MR HENSHAW

*JUDGMENT*

20th MARCH 1986

appeared in person on his own behalf.

solicitor of Messrs. Henshaw Wheeldon, solicitors, appeared for the respondent/wife

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NYGH J:        This is an appeal from his Honour McCall J, given on 20th December 1984 from which the husband has appealed. In his judgment, his Honour was concerned with basically two matters; firstly, the wife's application for property settlement and, secondly, the husband's application in seeking access to the two younger children of the marriage.

The relevant facts are quite adequately set out in his Honour's judgment, and for reasons of time and pressure of business I will simply confine myself to incorporating the findings of fact which were not seriously disputed in the appeal before me, into my judgment.

The salient feature of this was that the parties, who were married in 1964, worked for a considerable period together in the development and sale of various properties and businesses, and did so until 1977 on what his Honour found to be a basis of equal contribution. His Honour specifically, at page 25 of the judgment, says that if the matter had come before him in 1977 the only conclusion he could have come to would be that the parties had contributed equally and would have been entitled to an equal division, not only having regard to the contributions each of them made financially and non-financially, but also having regard to the contribution each of them had made to the welfare of the family.

In 1977 the parties resumed occupation of what has been the principal matrimonial home at Suburb B near Perth.  They decided to renovate that house, for reasons which his Honour explains in his judgment and which I need not repeat here.  The renovations were financed with funds that the parties had acquired and some funds which had been borrowed.

In January 1978 the wife's father died intestate and the wife became the sole heir to his property; quite a substantial amount came into her hands, after the payment of debts including death duties.  His Honour found, and again this was not disputed, that the wife received a sum total of $59,000 from her father's estate and he also found that a further amount of some $30,000 was still due to be received by her at that time.

His Honour further found that during the period from 1978 until 1981, when the parties separated, the wife contributed a sum total of $55,000 from the $59,000 that she had received, to the further extensions of the house, to the purchase of furniture and also to the household expenses of the family.  However, in the valuation which was before his Honour and to which he makes reference at page 27 of the judgment, the evidence of the valuer was that the extension to the house did not reflect a comparable increase in value.  In other words, the money spent on the extension of the house in effect had over-capitalised the house.  The evidence of the valuer, which his Honour accepted, was that the value of the house without the extensions, that is to say both work done prior to the wife's inheritance and after, would have been $50,000.  In fact the value given by the valuer was $60,000; that is to say the extensions added approximately $10,000 to the value of the house. The valuer further gave evidence that the $10,000 could be apportioned as to $4,000 to the first set of improvements, as I said done without the benefit of the wife’s inheritance, and the second set added $6,000.  However, it should be pointed out that some $3,000-odd of the wife's money was devoted to the payment off of the mortgage which had been incurred in financing the first lot of extensions.

The parties separated on 29th December 1981 and the marriage was dissolved by decree nisi in April 1983. The wife remarried in 1984.  There are four children of the marriage, two of whom are now over the age of 18 and are no longer the concern of this Court. The two younger ones, a boy who was aged 11 at the time of the hearing and a girl who was aged 5 1/2 are in the custody of the wife and are living with her and her present husband at Suburb C.  The wife did not seek maintenance in respect of those children and his Honour found, and this again was not disputed in any way, that she was in a position where she was adequately being supported by her present husband.

The two issues, as I have mentioned earlier, are firstly the issue of the distribution of the property and, secondly, the question of access.  I will deal first of all with the property issue.

The orders which his Honour made were that the husband should receive the sum of $13,000 within 30 days and that thereupon the husband should vacate the former matrimonial home and transfer his right, title and interest in that jointly owned property to the wife.  The husband had also vested in him a certain amount of shares worth $1,500 as his own property and the wife was further ordered to transfer and assign to the husband her interest in a life assurance policy which was given a value of $1,129.

The items of furniture were divided as between the husband and wife according to lists which were tendered to his Honour: list A which contains some furniture worth, on the values given therein, $6,342, were to be retained by the wife and I understand that those were at  all times in her possession, and another list marked B which adds up, according to the values given therein to $1,260, were assigned to the husband. They, as understand it, were at that time in the former matrimonial home which was at the time of the hearing occupied by the husband. The husband alleges that he has not in fact received that furniture but that the wife, as he put it,

broke into the house and removed it.  This is a matter which we cannot deal with because it is clearly an event that happened after the orders were made by his Honour; no application was made to adduce fresh evidence.  If what the husband alleges is true and the wife has seized property which clearly under the orders made by his Honour is  the property of the husband, then of course the husband can take the appropriate proceedings to enforce his right, title and interest to those assets, if she refuses to deliver them to him as she would be obliged to do and no doubt Mr. Henshaw will advise her accordingly.

The total effect of the orders made  by  his  Honour can best be described as follows:  There is, if one looks at the assets of the parties, first of all, the former matrimonial home which had an agreed value of $60,000 and was unencumbered; there is the furniture, which if both lists A and B are added together amounts in nearest round figures to a value of $7,500; the shares retained by the husband were $1,500;  there is  the surrender value of the life assurance policy which was admitted to have a value of $1,129.  This makes a total of just over $70,000.  From that should be deducted a debt of $1,460 to D Bank which was in respect of a car retained by the wife, the responsibility for which his Honour ordered should be taken over by the wife.  There was a car in each party's possession.  The exact value of those cars is unknown but it was conceded for the purpose of the appeal that the cars were of approximately equal value and therefore cancelled one another out.

That, therefore, means that the assets which his Honour divided between the parties amounted to some $68,500 leaving out of account the amount of $30,000 which the wife was still to receive at the time of hearing from her late father's estate which his Honour held was solely the property of the wife to which the husband had no claim or title.

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Of that $68,500 the husband received some $16,800 in value if one adds to the $13,000 the other items that his Honour assigned to the husband to which one should add arrears of maintenance the worth of which was some $3,000 and from which his Honour discharged the husband thereby giving him in effect a benefit to that amount.  If that is taken into account the total value received by the husband under the orders made by his Honour was just under $20,000 or approximately 30% of the assets as between the parties.

The husband has appealed from those orders on a variety of grounds. Some of these related to his Honour's finding as to the contributions which he had made to the farm which eventually the wife received by way of inheritance from her late father.  His Honour made certain findings on that fact.  He was in my view entitled to make those findings and it is not possible at this stage to review the correctness of the findings on that evidence.

However, a more substantial objection raised by the husband to the determination made by his Honour in relation to property was that his Honour grossly overstressed the contribution made by the wife through her inheritance and the effect thereof and by necessary implication and corollary grossly underestimated the contribution which the husband had made up to 1978 and which he continued to make until 1981.

In my view that submission by the husband is justified. His Honour found that although the wife put a large amount of money into the renovations of the former matrimonial home, much of that money was in effect wasted on an overcapitalisation.

When one looks at the question of contribution made by a party to the acquisition, preservation and maintenance of property it must clearly be relevant to determine to what extent that contribution is reflected in the increase in value in that property.  If one looks at money which the wife spent in respect of that property and the effect it had on an increase in the value of that property then the contribution made by the wife is much less in value and effect than would at first sight appear. To that extent it is my view that his Honour erred in over-stressing the importance in monetary terms of the contribution made by the wife to the development of the former matrimonial home.

In addition, in my view, his Honour also erred in that at the end of the hearing he did not, as the Full Court indicated in the decision of Lee-Steere and Lee-Steere (1985) FLC 91-626, look at the overall effect of his orders on the financial positions of the parties.  As his Honour quite rightly pointed out, the inheritance received or to be received by the wife of a value of $30,000 were not assets to which it could be said that the husband had made a contribution but that, of course, does not mean that her receipt of $30,000 in the future was not a relevant factor to be taken into account. The Full Court in Carter and Carter (1981) FLC 91-061 has pointed out, and the Full Court has repeated this point in Lee-Steere and Lee-Steere at 80,078, that the Court must look at the overall financial situation of each of the parties. If one does that then clearly one can only come to the conclusion that the wife has received and will continue to receive a considerable financial advantage which by far outweighs that to be received by the husband.

Again if one looks, and compares, the s.75(2) factors which must be taken into account after one has taken into account the contribution of the parties, then again one sees on the one hand the wife, as his Honour pointed out in his judgment, who was not in need of maintenance for herself being adequately supported by her own moneys and by those of her present husband, and the wife, although she would have had a claim to maintenance for the children had she pressed it, chose not to press that claim before this Court.  On the other hand, there was evidence before his Honour that the husband's financial future was uncertain so far as his employment was concerned and, as his Honour himself remarked in the course of argument, the husband was likely to be met with a large claim for legal costs.  Again that factor is one which, as the Full Court in Lee-Steere and Lee-Steere pointed out, has to be taken into account when the needs of the parties are to be compared.  Of course, it cannot be denied that the wife too would have legal costs to meet, and indeed his Honour pointed out, it would appear quite correctly, that those liabilities might be between $12,000 and $15,000.

Taking all those matters into account a division of the assets accumulated during the marriage of the parties of a value of approximately $70,000 of 30% to the husband and 70% to the wife having regard to their respective contributions, which as his Honour found, up to and including 1977 were equal, having regard to the much larger contribution clearly made by the wife following 1977, and having regard to the balance of needs of each  of the  parties  is, to my mind, an inadequate division.  In my view, his Honour erred in not giving sufficient consideration to the contribution made by the husband vis-a-vis that of the wife.  His Honour further erred in not giving sufficient consideration to the relative needs and means of the parties as at the date of the hearing.  For those reasons the appeal of the husband, insofar as it relates to the property orders made by his Honour, should be allowed and those orders should be amended.

Having regard to the factors to which I have referred, in my view an appropriate rate of division as between the parties of those assets to which the parties have made a contribution as at the date of the hearing would be one in which the husband receives 40% and the wife 60%.  This, on my calculations, means that the orders of his Honour should be amended by reading in lieu of “$13,000”, “$19,500”; that is to say, adding to the amount the husband is to receive the sum of $6,500.  I will propose formal orders at the end of the judgment after I have dealt with the other matter for consideration by this Court.

The other appeal concerned the question of access.  Again the facts are set out in considerable detail in the judgment of his Honour and I have no wish to repeat them here.  It is, like many of these matters, a very tragic case.  It would appear that certain allegations were made against the husband of sexual abuse.  They were the subject of proceedings in 1982, as a result of which the wife was awarded custody and certain orders were made in relation to access by the husband. The husband sought to protest before us that those allegations were untrue, but that matter was not before us and it is not really relevant to the present proceedings, for his Honour in denying access to the husband did not base his determination on anything that the husband may or may not have done in the past.  He based it, as I tried to point out to the husband in the course of argument, fairly and squarely on what his Honour described as the obstructive attitude of the wife.  Indeed, he described it (at page 46) as "totally obstructive" towards any access by the husband. His Honour further found that that attitude of the wife was most unlikely to change and that in those circumstances there was 1ittle benefit to be gained by enforcing access of the husband to the children.

With deep regret, having regard to this tragedy, I must agree in this respect with his Honour.  Indeed, I can only say that given that fact situation, that was the only conclusion which his Honour could come to having regard to the welfare of the children.  It is not a matter of adjudicating as between the rights and wrongs of the parties, of making findings that the husband is in the right and the wife is in the wrong. Our only consideration in these matters can be the welfare of the children. In this case, having regard to the wife's attitude and even assuming that the wife's attitude is totally irrational and unfounded, an assumption of course that, having regard to the evidence before us, we cannot necessarily make, but even assuming that, it is quite clear that in view of the wife's attitude any attempt by the husband to come near the children will cause enormous trauma and unhappiness  to them, and for  those reasons therefore, in my view, the appeal by the husband insofar as it  relates to the question of access must be dismissed.

The orders therefore that I would propose are first of all that the appeal of the husband from the judgment of the primary judge given on the 20th of December 1984 be allowed in part. Secondly, that order number 1 of the orders made by his Honour be amended by substituting for the figure of $13,000 the figure of $19,500.  Thirdly, that the additional amount of $6,500 be paid by the wife within 30 days and thereafter if remaining unpaid carry interest at the rate fixed by order 40 rule 1.  Fourthly, that the said amount and any interest accrued thereon be a charge against the property known as E Street, Suburb B in the State of Western Australia and more fully described in the orders appealed from.  Five, that in the event that the said amount and any interest accrued thereon is not paid within three months of the date hereof the wife take all necessary steps to have the said property sold at the best price obtainable and that out of the net proceeds of  ale there be paid to the husband the said sum of $6,500 together with any interest accrued thereon.  Six, that each party be at liberty to apply to a single judge of the Family Court of Western Australia in respect of the implementation and execution of the above orders on giving seven days’ notice.  Seven, that the appeal of the husband in relation to the access to the children of the marriage be dismissed.

BUTLER J:  I concur with the reasons and words of my brother Nygh.  I have nothing to add to the words he has spoken.  I agree with the orders he has proposed.

JOSKE J:  Yes, I too agree with the reasons that have been expressed by Mr. Justice Nygh.  There is        nothing that I wish to add.  I further agree with the orders proposed by him.

Accordingly, the formal orders of the Court will be as follows:

 

1.That the appeal of the husband from the judgment of the primary judge of 20th December 1984 be allowed in part.

2.That order number 1 of the orders made by the primary judge be amended by substituting for the figure of $13,000 the figure of $19,500.

3.Order that the additional sum of $6,500 be paid by the wife within 30 days of this date and thereafter if the same remains unpaid interest shall run at the rate prescribed by Order 40 rule 1.

4.That the said amount of $6,500 and interest accrued thereon shall be a charge against the property situate at and known as E Street, Suburb B in the state of Western Australia and being more fully described in the orders that are appealed from.

5.That in the event that the said amount of $6,500 and any interest accrued thereon is  not paid within three months of the date hereof the wife shall take all necessary steps to have the said property sold at the best price obtainable and that out of the net proceeds of such sale she shall pay to the husband the sum of $6,500 together with any interest that has accrued.

6.Reserve general liberty to either party to apply to a single judge of the Family Court of Western Australia upon giving seven days notice in writing to the other party in relation to the implementation of these orders.

7.That the appeal in relation to the question of access be dismissed.

8.That the sum of $1,000 paid into the Court by the husband pursuant to the order of the Family Court of Western Australia made on 29th November 1986 be released to the husband forthwith.