Nelson and Ashcroft
[2016] FCCA 1322
•2 June 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| NELSON & ASHCROFT | [2016] FCCA 1322 |
| Catchwords: FAMILY LAW – Property – De facto relationship – where the relationship is short – where one party has sustained serious physical and psychological injuries as a result of a workplace accident just prior to the commencement of cohabitation – where the other party has provided care and support during the period of the relationship and that provision of care and support has placed some restriction upon that party’s full employment during the relationship – where compensation has been paid pursuant to a statutory entitlement and the amount received by the injured party has been increased as a result of an acceptance that the children of the other party properly constitute dependents or an eligible young person for the purposes of any calculation of compensation – where the injured party has to some extent dissipated the compensation received reducing the pool available for distribution to the parties – where future needs of the injured party must be balanced against the positive future prospects of the other party – where adjustments must be considered in respect of financial and non-financial contributions as well as in light of future prospects. |
| Legislation: Military Rehabilitation & Compensation Act 2004, ss.15, 17, 80 Family Law Act 1975 (Cth), ss.4aa. 75(2), 79(2) & (4), 90SF(3), 90SM(3) & (4) |
| Cases cited: Hobbs & Valonz [2013] FCCA 1999 Stanford and Stanford Lots of Questions – Very Few Answers, Martin Barfeld QC of the Victorian Bar Australian Family Law Practice Handbook |
| Applicant: | MR NELSON (BY HIS LITIGATION GUARDIAN MR C NELSON) |
| Respondent: | MS ASHCROFT |
| File Number: | CSC 453 of 2015 |
| Judgment of: | Judge Coker |
| Hearing date: | 6 May 2016 |
| Date of Last Submission: | 6 May 2016 |
| Delivered at: | Townsville |
| Delivered on: | 2 June 2016 |
REPRESENTATION
| Counsel for the Applicant: | Mr Victoire |
| Solicitors for the Applicant: | Williams Graham Carman |
| Solicitors for the Respondent: | Mellick Smith & Associates |
ORDERS
That the Applicant and the Respondent forthwith do all acts and things and sign all necessary documents to effect a sale of the property situate at Property M and known as Lot (omitted) on Registered Plan (omitted), County of (omitted), Parish of (omitted) being the whole of the land more particularly described in Certificate of Title Reference (omitted) (“the Property M property”) and by way of consequential arrangement that shall be made for the purposes of effecting a sale:
(a)The listing price for the real property shall be as agreed between the parties and if there is no agreement the listing price shall be as advised by a valuer nominated by the President of the Queensland Law Society.
(b)The real property shall be listed for sale by private treaty with an agent and the agent shall be as agreed between the parties and if there is no agreement the agent shall be as nominated by the President of the Queensland Law Society.
In the event that the real property has not been sold by or before a date three (3) months from the date of these orders then the Applicant and the Respondent shall make all such arrangements and do all such acts and sign all such documents and pay all moneys equally necessary to procure a sale by public auction of the real property by the following terms:
(a)The auctioneer shall be as agreed between the parties and if there is no agreement the auctioneer shall be as nominated by the President of the Queensland Law Society;
(b)The auction shall take place by two (2) months after the deadline date for sale by private treaty;
(c)The reserve price shall unless agreed upon by the parties be as proposed by the auctioneer; and
(d)The Applicant and the Respondent shall each pay and be responsible for payment of one-half of auction expenses payable before the real property is auctioned.
In the event that the property is not so sold by auction or by private negotiation within fourteen (14) days after the said auction then the Applicant and the Respondent do all such acts and sign all necessary documents and shall pay all moneys equally necessary to procure a second auction within a further six (6) weeks of that date otherwise upon the same terms and conditions as applied to the first auction.
Upon completion of the sale the proceeds of the sale be applied as follows:
(a)Firstly, to pay all costs, commissions and expenses of the sale and to pay any council and water rates and maintenance levies outstanding in respect of the real property;
(b)Secondly, and subject to the Applicant being able to comply with paragraph 5(b) below, to pay to the Respondent the sum calculated by reference to the following formula:
a = [($287,244 + b) x 25%] - $14,500
where
a = the amount to be paid to the Respondent
b = the proceeds of sale after payment of the amounts returned in paragraph 4(a) above.
(c)Thirdly, or if the Applicant is not able to comply with paragraph 5(b) below, the balance to be paid by way of reduction of the debt owing with respect to the mortgage number (omitted) registered against the real property situated at Property C and known as Lot (omitted) on Survey Plan (omitted), County of (omitted), Parish of (omitted), being the whole of the land more particularly described and certified as Title Reference (omitted) (“the Property C property”).
That contemporaneously with the distribution of the proceeds of sale referred to in paragraph 4 above:
(a)And subject to the Applicant being able to comply with paragraph 5(b) below, the Respondent do all such acts and things and sign all such documents as may be required to transfer to the Applicant at the expense of the Applicant all of her right title and interest in the Property C property; and
(b)The Applicant shall indemnify the Respondent against and cause her to be discharged from any liability pursuant to the (omitted) Bank Mortgage No. (omitted) and any liabilities for all rates, taxes and outgoings of or with respect to the real property of whatsoever nature and kind.
In the event that the Respondent is not able to comply with paragraphs 5(b) above, the Applicant and the Respondent forthwith do all acts and things and sign all necessary documents to effect a sale of the Property C property and by way of consequential arrangement that shall be made for the purposes of effecting a sale:
(a)The listing price for the real property shall be as agreed between the parties and if there is no agreement the listing price shall be as advised by a valuer nominated by the President of the Queensland Law Society.
(b)The real property shall be listed for sale by private treaty with an agent and the agent shall be as agreed between the parties and if there is no agreement the agent shall be as nominated by the President of the Queensland Law Society.
In the event that the real property has not been sold by or before a date three (3) months from the date of these orders then the Applicant and the Respondent shall make all such arrangements and do all such acts and sign all such documents and pay all moneys equally necessary to procure a sale by public auction of the real property by the following terms:
(a)The auctioneer shall be as agreed between the parties and if there is no agreement the auctioneer shall be as nominated by the President of the Queensland Law Society;
(b)The auction shall take place by two (2) months after the deadline date for sale by private treaty;
(c)The reserve price shall unless agreed upon by the parties be as proposed by the auctioneer; and
(d)The Applicant and the Respondent shall each pay and be responsible for payment of one-half of auction expenses payable before the real property is auctioned.
In the event that the property is not so sold by auction or by private negotiation within fourteen (14) days after the said auction then the Applicant and the Respondent do all such acts and sign all necessary documents and shall pay all moneys equally necessary to procure a second auction within a further six (6) weeks of that date otherwise upon the same terms and conditions as applied to the first auction.
Upon completion of the sale the proceeds of the sale be applied as follows:
(a)Firstly, to pay all costs, commissions and expenses of the sale and to pay any council and water rates and maintenance levies outstanding in respect of the real property;
(b)Secondly, to discharge the (omitted) Bank mortgage number (omitted) registered against the Property C property;
(c)Thirdly, to pay to the Respondent the amount determined by the reference to the following formula, namely:
a = [($16,244 + b + c) x 25%] - $14,500
where
a = the amount to be paid to the Respondent
b = the proceeds of sale of the Property M property after payment of the amounts returned in paragraph 4(a) above.
c = the proceeds of sale of the Property C property after payment of the amounts referred to in paragraph 9(a) and 9(b) above.
(d)Fourthly, the balance to be paid to the Applicant.
That within fourteen (14) days from the date of these Orders, the Respondent do all acts and things and sign all documents required to transfer to the Applicant all of her right, title and interest in the joint (omitted) Bank Account (Account Number (omitted)).
That the Applicant shall retain sole beneficial ownership as against the Respondent of the following:
(a)His bank accounts;
(b)His superannuation; and
(c)The furniture and household items in the Applicant’s possession as at the date of these Orders.
That the Respondent shall retain sole beneficial ownership as against the Applicant of the following:
(a)(omitted) Mazda;
(b)Her bank accounts;
(c)Her superannuation entitlements;
(d)Her jewellery; and
(e)The furniture and household items in the Respondent’s possession as at the date of these Orders.
General Orders
Unless otherwise provided for in these Orders, the transferee spouse or the spouse receiving the benefit of any transaction pursuant to these Orders, will prepare the documentation necessary to give effect to the provisions of these Orders at their costs and further be responsible for payment of registration fees and all other fees in relation to the transfer of the property assets to their names.
That unless otherwise provided for in these Orders, that any duty payable on transactions arising from these Orders, or any documents executed pursuant to these Orders be paid by the transferee spouse or the spouse receiving the benefit of such transfer or transaction.
That the parties do all acts and sign all documents required to implement these Orders.
That unless otherwise specified in these Orders and except for the purposes of enforcing the payment of any money due under these or any subsequent Orders:
(a)Each party be solely entitled to the exclusion of the other party to all property in the possession of such party as at this date;
(b)Each party hereby forgoes any claim they may have to any superannuation benefits belonging to or earned by the other;
(c)All insurance policies to become the sole property of the owner names thereunder; and
(d)Each party be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders.
Default
That if either party refuses or neglects to sign (within 14 days of a written request to do so) any documents necessary to give effect to these terms of these Orders the Registrar of the Family Court of Australia at Cairns is hereby appointed pursuant to the provisions of section 106A of the Family Law Act 1975 to execute such documents on behalf of such party.
Notation
A.The parties intend that, pursuant to the terms of Section 81 of the Family Law Act 1975 (as amended), these Orders shall, as far as practicable, finally determine the financial relationship between them and avoid further proceedings.
IT IS NOTED that publication of this judgment under the pseudonym Nelson & Ashcroft is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT CAIRNS |
CSC 453 of 2015
| MR NELSON |
Applicant
And
| MS ASHCROFT |
Respondent
REASONS FOR JUDGMENT
INTRODUCTION:
On 28 July 2015, an initiating application was filed in this Court by Mr Nelson. For convenience, I shall refer to him as "the applicant". The respondent to the application is Ms Ashcroft and again for convenience I shall refer to her as “the respondent”. She filed a response to the initiating application on 18 September 2015. Thereafter, the matter has progressed quickly to a final determination.
In light of the circumstances that exist at the present time and I shall come to them a little more comprehensively shortly, it is understandable that this matter has been expedited in its listing and hearing.
THE APPLICATIONS:
In the initial application that was filed by the applicant on 28 July 2015, orders were sought with regard to what should occur in relation to two properties owned by the applicant and the respondent. Those properties are situate at Property M and a second property is situated at Property C. The proposals in relation to the final orders included, in summary, the following:
(1)That the applicant and the respondent do all acts and things necessary to effect the sale of the property at Property M and consequential arrangements be put in place with regard to the listing of the property and the steps to be taken with regard to either auction or sale by private treaty.
(2)That in the event that the property is not sold by auction or by way of private negotiation, then further steps be taken with regard to a second auction being facilitated at a reduced price.
(3)That contemporaneously with the receipt of any funds associated with the sale of the property, that the respondent transfer to the applicant all of her right, title and interest in and to the property situate at Property C.
(4)That the respondent correspondingly do all acts and things necessary and sign all documents required to transfer into his name only all responsibility in relation to any liability attaching to the property.
(5)That the respondent further take all necessary steps to transfer to the applicant all of her right, title and interest in and to the proceeds of the (omitted) Bank account, account number (omitted).
(6)That the applicant retain for his sole benefit and to the exclusion of the respondent, a Jeep Grand Cherokee, bank accounts, superannuation entitlements and furniture and household items as are in the possession as at the date of any orders.
(7)That the respondent retain, to the exclusion of the applicant, all her interest in and to a (omitted) Mazda motor vehicle, her bank accounts, liabilities, if any, that might arise, her superannuation entitlements, jewellery, furniture, chattels and other household items as might be in her possession as at the date of any orders.
(8)That the parties do all acts and things necessary so as to effect a settlement as between the two of them pursuant to these orders and should either party fail or neglect to sign documents as required so as to put into effect the orders of the Court, then that the Registrar of the Family Law Courts at Cairns be appointed pursuant to the provisions of section 106A of the Family Law Act to execute such documents on behalf of each party.
The respondent, in her response, indicated a different perspective, though acknowledged that there was, clearly, a need to resolve the issues of the joint property circumstances of the parties. The proposed orders were contained in orders 4.1 through 4.4 as detailed in the response to initiating application, filed on 18 September 2015. The orders sought by the respondent were in these terms:
1. 4.1 That within 21 days of date of Court Order, the Applicant transfer all of his right, title and interest into the house property situated at Property M, and more particularly described as Lot (omitted) on RP (omitted), County of (omitted), Parish of (omitted), and being the whole of the land contained in Certificate of Title Reference (omitted), together with all improvements thereon and therein and free of any mortgage;
2. 4.2 Contemporaneous with the transfer referred to in paragraph 4.1 herein, the Respondent shall transfer to the Applicant all of her right title and interest in the house property situated Property C and more particularly described as Lot (omitted) on (omitted), County of (omitted), Parish of (omitted), and being the whole of the land contained in Certificate of Title Reference (omitted) together with all improvements thereon and therein;
3. 4.3 Contemporaneous with the transfer referred to in paragraph 4.2, the Applicant shall take all necessary steps to have the Respondent discharged from any mortgage over the Property C property, and more particularly (omitted) Bank Mortgage No. (omitted); and
4. 4.4 The Respondent reserves her rights to file an Amended Response in relation to Orders which she is seeking once full disclosure has been made by the Applicant.
CIRCUMSTANCES IMMEDIATELY PRECEDING AND DURING THE HEARING:
It should be noted that the situation relating to the position of one of the parties thereafter changed significantly. In summary, it was noted in the case outline, filed on the part of the applicant on 4 May 2016, that the applicant then proposed that both of the properties at Property M and Property C be sold and that the net proceeds of sale be divided, 20 per cent to the respondent and 80 per cent to the applicant. Thereafter, there was a proposal that each party should then retain the property in their possession or control, including bank accounts, as previously mentioned, as well as superannuation and other property and that each indemnify the other in relation to any liabilities attaching to any property that might be retained by them.
The position of the respondent remained unchanged.
The change with regard to the applicant's position, in relation to the matter, on 4 May 2016, was an understandable one. The applicant, who was a (occupation omitted) with the (employer omitted), had a workplace accident on (omitted) 2012. As a result of that accident, he suffered permanent injuries which gave rise to serious physical disabilities for the applicant but also, unfortunately, had given rise to serious concerns with regard to the applicant's mental health.
The indications contained within the affidavits provided in relation to the matter are to the effect that the applicant, as a result of the workplace injury, was diagnosed with interstitial lung disease, depression, PTSD, alcohol abuse/dependence, panic disorder, agoraphobia, acquired brain injury with global cognitive deficits and general difficulties in relation to the control of his behaviour.
As a result of those circumstances, both physical and mental, concerns arose with regard to the behaviours of the applicant such that, unfortunately, in May of 2013, some seven months or thereabouts after the workplace incident occurred, the applicant attempted suicide. Far more significant in relation to these proceedings, however, is that on or about 23 or 25 April 2016, only a matter of some two weeks prior to the hearing of the proceedings, the applicant again attempted suicide.
He was initially admitted to the (omitted) Hospital and at the time of trial was an inpatient at the (omitted) Hospital at the (omitted) Hospital in Brisbane. The applicant's treating psychiatrist, Dr D, informed the solicitors for the husband of the following:
(a)Mr Nelson has been readmitted to the (omitted) Hospital...in the context of acute suicidality and will continue to need inpatient care for the next several weeks and;
(b)Given the acute nature of his currently disturbed mental state, along with the potential cognitive side effects of new medication, it is reason to suggest that Mr Nelson is currently not capable of adequately conducting or giving appropriate instructions for the conduct of the proceedings.
It was in the light of that circumstance that an urgent application in a case was also filed by leave on the morning of hearing. That application in a case sought an order to the effect that Mr C Nelson be appointed as litigation guardian for the applicant in the proceedings before the Court. There was no objection taken in respect of that course and it was, of course, specifically noted that it was essential for a number of reasons, not the least of which related to the ongoing mental health of the applicant, such that these proceedings needed to be brought to a close.
An order was made for the appointment of Mr C Nelson as the litigation guardian of the applicant. In the material accompanying the application in a case for the appointment of a litigation guardian, under the hand of the applicant's solicitor, Mr Edward Luigi Anthony Lago, is attached a brief report from the (omitted) Clinic under the hand of Dr D. Dr D noted, in the third paragraph on page 1 of his report of 2 May 2016, the following:
5. … it is reasonable to suggest that Mr Nelson is currently not capable of adequately conducting or giving appropriate instruction for the conduct of the proceedings.
On the second page, Dr D continues:
6. Were there an appropriate proxy or litigation guardian able to be sourced (such as a family member with an appropriate ongoing relationship) I think it would be in Mr Nelson's best interests to have such a guardian appointed and for these Court proceedings to continue in his absence, so as to enable their timely resolution and reduce his degree of distress during the recovery process from this episode of illness.
CONDUCT OF THE HEARING:
In light of those circumstances and of the desire of all including the applicant's treating psychiatrist to bring these proceedings to an end, the matter was able to be proceeded with and the hearing was heard on an abridged basis it being acknowledged that the appropriate course to follow was for the application to proceed on the papers with submissions.
In that respect, it was also indeed most appropriate that the parties were able to agree on a set of facts in relation to what was the basis for the relationship. The agreed facts were in these terms:
7. Agreed Facts
8. Background
9. 1. The Applicant is 44 years of age (born (omitted)/1972). He is a pensioner.
10. 2. The Respondent is 43 years of age (born (omitted)/1972). She works as an (occupation omitted) with (employer omitted).
11. 3. The Applicant has 2 children from 2 previous relationships: X aged 10 (born (omitted)/2005) and Y aged 5 (born (omitted)/2010), from previous relationships. They live with their mothers. The Applicant pays child support for the children.
12. 4. The Respondent has 3 children from a previous relationship: A aged 19 (born (omitted)/1996), B aged 16 (born (omitted)/99) and C aged 12 (born (omitted)/2004).
13. Cohabitation period
14. 5. The parties entered in a defacto relationship in early October 2012 and separated in November 2014, a period of 2 years and 1 month.
15. Applicant’s accident & impact
16. 6. On (omitted)/2012, shortly before cohabitation the applicant, who was a (occupation omitted) with the (employer omitted), had a workplace accident.
17. 7. His injuries are permanent and he was medically discharged from the (employer omitted) in May 2013. He is not capable of returning to the workforce.
18. 8. The Applicant has been diagnosed with Interstitial Lung Disease, Depression, PTSD, Alcohol abuse/Dependence, Panic Disorder, Agoraphobia, Acquired brain injury with global cognitive deficits. He has difficulty controlling his behaviour.
19. 9. The Respondent was diagnosed with secondary PTSD and received counselling through the Department of Veteran Affairs (DVA).
20. Contributions at cohabitation
21. 10. At cohabitation the Applicant had assets totalling $32,500 and superannuation of $67,852. His assets included a fully mortgage property at Property W.
22. 11. The Respondent had assets totalling $129,000 (including cash of $100,000) and superannuation of $200,000.
23. 12. The Applicant was an (occupation omitted) on a wage of $1,350 per week. The Respondent was on a wage of $820 per week nett.
24. Respondent’s Children
25. 13. During the relationship, A lived with the Respondent’s mother and spent time at the home of the parties. B lived with her father but spent every second weekend with the parties. C lived with the parties and spent weekends with his father.
26. 14. The Respondent deposes that her eldest child lived with her mother most of the time whilst the two younger children were in her full time care and spent every second weekend with their father.
27. 15. The parties agreed that the precise living arrangements for the Respondent’s children do not need to be resolved.
28. Contributions during cohabitation
29. 16. The Respondent was the primary homemaker. She was supportive of the Applicant and took the Applicant to his medical appointments.
30. 17. In August 2013, the parties received assistance from DVA with a gardener and a cleaner on a fortnightly basis and a pool maintenance person each month.
31. Compensation DVA
32. 18. On 03/02/2014, the Applicant received compensation for permanent impairment of $378,032 from the Department of Veteran Affairs for his injuries. He had reached the requisite number of impairment points to receive the maximum compensation payment.
33. 19. On 09/04/2014, he received $406,837 being 5 payments of $81,367 for each of the five children who were deemed to be both the Applicant’s dependents and eligible young persons under the Military Rehabilitation and Compensation Act. The amount referable to the Applicant’s 2 children was $162,734. The amount referable to the Respondent’s 3 children was $244,101.
34. 20. Income during cohabitation.
35. Details 36. Applicant 37. Respondent 38. Income from wages 39. 40. $88,560 41. Carer’s allowance 42. 43. $2,946 44. Income: Rental Property W, DVA, (employer omitted) Super 45. $130,358 46. 47. Payment from (employer omitted) 48. $18,820 49. 50. Total 51. $149,178 52. $91,506 53.
54. 21. The Respondent worked reduced hours in the financial year ending June 2015 to assist the Applicant. Her nett income was reduced by approximately $10,000.
55. Property C
56. 22. On 26/10/2012, the parties settled on their purchase of Property C . The house was purchased for $495,000. They obtained a mortgage of $455,000.
57. 23. The Applicant says they each contributed $40,000 whilst the Respondent says she contributed $40,000 and he contributed about $10,000. They agree that DVA paid for the stamp duty of $8,575.
58. 24. The mortgage payments were made from the joint bank account with payments of $1,650 per week.
59. 25. On 10/04/2014, the Applicant discharged the mortgage with a payment of $427,364, from his compensation monies.
60. Property M
61. 26. On 30/04/2014, the parties settled on their purchase of Property M. The purchase price was $293,500. They paid a deposit of $5,000 and stamp duty of $10,900. It was fully funded using the line of credit secured over the Property C home. The house was rented.
62. Property W
63. 27. On 13/02/2014, the Applicant used $200,000 of the compensation monies to discharge the mortgage over the Property W property.
64. 28. That property was sold after separation. On 01/04/2015, he received $191,067, being the nett proceeds of sale. Those funds have been fully expended by the Applicant, on matters unrelated to the relationship, including approximately $50,000 in payment of child support.
65. Following separation
66. 29. The Respondent moved to the former investment property at Property M and the Applicant remained in the former matrimonial home at Property C.
67. 30. Each party contributed $275 per week to the mortgage instalments on the investment property.
68. Protection Order
69. 31. The Respondent obtained a Protection Order against the Applicant in 2014. The Applicant breached that order on two occasions.
70. Applicant current health
71. 32. The Applicant attempted suicide in May 2013. He again attempted suicide on 23/04/2016. He was initially admitted to (omitted) Hospital. He is currently a patient at (omitted) Hospital, Brisbane under the care of Dr D, psychiatrist.
72. 33. His doctor has advised that it would be best for the Applicant if the property proceedings were finalised to remove the stress of the litigation on the Applicant. The Applicant’s brother, Mr C Nelson, is prepared to act as litigation guardian.
73. 34. The Respondent does not oppose the appointment of a litigation guardian.
What was also noted following the agreed facts was that there were certain areas of dispute, some of which it was acknowledged, were simply unable to be determined by the Court. It was noted, for example, that there was not agreement as to the whereabouts of a ring that was purchased by the parties during the period that they were together. The ring is valued at approximately $5700 and both the applicant and the respondent indicate that, to their knowledge, it is in the possession or control of the other party. It is, of course, impossible to make any findings in relation to that particular aspect of the matter.
Similarly, there was dispute as to the amount of furnishings removed from the residence at the time of separation between the applicant and the respondent. The applicant suggested that the respondent had removed virtually the entirety of the household contents, whilst the respondent's position was to say that only limited property, primarily being furniture and chattel items relating to the needs of her own children, were removed and that all other items of property remained within the residence. Whatever might be the case and it is impossible to make a determination, each party acknowledges that they now have in their possession furniture and household items with a value of approximately $10,000.
Thirdly, there was some dispute as to the living arrangements of two of the respondent's children of a prior relationship and whether they were or were not significant members of the parties' household during the period of their cohabitation between the latter part of October 2012 and separation in November of 2014.
It was noted that the parties recognised that it was not directly necessary to resolve the issues that I have referred to above. It was agreed, quite properly, that the impact of those particular matters and findings being made in relation to them would not to any real degree impact on the overall division of the assets of the parties.
Before specifically referring to that, however, it is important to note that whilst each of the parties detailed in their application or response what might be the proposals in relation to the final resolution of this matter and even went so far as to propose amounts to be paid and how that should be effected, the circumstances changed again at the very door of the Court.
As indicated, when the case outline by the applicant was filed on 4 May 2016, it was suggested that both of the properties at Property M and Property C should be sold. However, the instructions received by the legal representatives for the applicant's litigation guardian were to the effect that the applicant hoped still to retain the property at Property C and, therefore, a different proposal was put forward in respect of what should occur with regard to the property settlement.
An amended order was handed up as prepared by the solicitor for the applicant. It provided a detailed “formulaic approach” to be taken in relation to the settlement of the property matters between the parties. The legal representatives for the respondent acknowledged that they were agreeable to such a formulaic approach being taken though they suggested in particular, that the percentage to be used for the purposes of calculation should be adjusted. In that respect, the applicant proposed a percentage to be utilised in any calculations of 20 per cent, whilst the respondent's position was to suggest that any formula to be applied would be upon a basis of 40 per cent included in any calculations to be effected.
I note that the proposed order, subject to any adjustment in relation to the percentage to be used in the formula, is agreed and is the order that is to be made in relation to these proceedings subject to what might ever be the ultimate percentage to be included.
THE MAJOR ISSUE:
It was acknowledged that the real issue here was the consideration of how certain compensation payments received by the applicant was to be categorised. In particular, there was a concern as to whether it was to be categorised as a contribution on the part of the applicant, a contribution on the part of the respondent or, as was emphasised on the part of the respondent if not a contribution directly attributable to her then a joint contribution.
That particular argument arises from the agreed fact at point (19) of the agreed facts. It is noted there that prior to separation, on 9 April 2014, the applicant received $406,837, being five payments of $81,367 for each of the five children who were deemed, pursuant to the Military Rehabilitation and Compensation Act 2004, to be dependent children.
In that respect, I was provided with copies of the Military Rehabilitation and Compensation Act. It should be noted in respect of that legislation that there are additional amounts payable if the maximum compensation able to be made payable to a person has been paid. It is necessary here only to note that there is a points assessment system utilised for the purposes of a determination of compensation and if the points attributable to the injuries which have arisen from a workplace accident are greater than 80 points, then the person is entitled to the maximum compensation to be paid.
Section 80 of the Military Rehabilitation and Compensation Act notes, at subsection (1) as follows:
74.(1) This section applies to a person (the impaired person) who has been paid, or is entitled to be paid, compensation under this Part if the Commission has determined that the degree of impairment suffered by the person as a result of one or more service injuries or diseases constitutes at least 80 impairment points.
It is simply to be noted that the applicant is assessed as having a degree of impairment of 82 impairment points. As a result of that, the further provisions of section 80 become relevant and in particular subsections (2) and (3) of section 80 of the Military Rehabilitation and Compensation Act. Subsections (2) and (3) are in these terms:
75.(2) The Commonwealth is liable to pay the impaired person $60,000 for each person who is both a dependant of the impaired person and an eligible young person at the later of:
a.(a) the date determined by the Commission to be the date on which the impairment suffered by the impaired person constitutes at least 80 impairment points; or
b. (b) either:
(i)if the person has a single service injury or disease-the date on which a claim was made under section 319 for acceptance of liability for the injury or disease; or
(ii)otherwise-the date on which the most recent claim was made under section 319 for acceptance of liability for one of the service injuries or diseases concerned.
c.Note: The amount of $60,000 is indexed under section 404.
76.(3) The amount specified in subsection (2) is also payable in respect of a child of the impaired person:
a.(a) who was born alive on or after the later of those times but who was conceived before that time; or
b.(b) who was adopted on or after the later of those times but in respect of whom adoption proceedings were begun before that time.
Therefore, there are payments to be paid to the impaired person:
77. ...for each person who is both a dependant of the impaired person, and an eligible young person...
A "dependant" is defined twice under the provisions of section 80(3) to include both a person as defined as a dependant pursuant to the provisions of section 15, and also a person who is dependent upon the impaired person, for economic support. The issue here is not whether the respondent's three children by a prior relationship were defined as "dependants" for the purposes of the calculation of whether additional payments were to be made in relation to dependants.
Section 15 of the Military Rehabilitation and Compensation Act 2004 defines a dependant. Section 15 of the Act is in these terms:
78.(1) A dependant of a member means any person mentioned in subsection (2):
a. (a) who is wholly or partly dependent on the member; or
b. (b) who would be wholly or partly dependent on the member but for an incapacity of the member that resulted from an injury or disease or an aggravation of an injury or disease.
79. Note 1: Sections 17 and 18 set out some examples of when a person is wholly dependent on a member.
80.Note 2: This section also applies to former members (see section 20).
81. (2) These are the persons who can be a dependant of a member for the purposes of subsection (1):
a. (a) any of the following persons:
b. (i) the member's partner;
c. (ii) a parent or step-parent of the member;
d. (iii) a parent or step-parent of the member's partner;
e. (iv) a grandparent of the member;
f. (v) a child or stepchild of the member;
g. (vi) a child or stepchild of the member's partner;
h. (vii) a grandchild of the member;
i.(viii) the member's brother, sister, half-brother or half-sister; or
82.Note: This paragraph is affected by section 16.
a. (b) a person in respect of whom the member stands in the position of a parent; or
b. (c) a person who stands in the position of a parent to the member.
There is also a recognition that whilst dependants of a member are defined there is a further definition contained within section 17 of the Military Rehabilitation and Compensation Act, relating to eligible young persons and how they might be considered to be dependent upon a member who has suffered a debilitating injury. Section 17 of the Military Rehabilitation and Compensation Act 2004 is in these terms:
83. When partners and eligible young persons are wholly dependent on a member
84.Partners
85. (1) For the purposes of this Act, the partner of a member is taken to be wholly dependent on the member if:
a.(a) the partner lives with the member; or
86.(b) the Commission is of the opinion that the partner would be living with the member but for a temporary absence of the member or partner or but for an absence of the member or partner due to illness or infirmity.
87.Note: This subsection also applies to former members (see section 20).
88.Eligible young persons
89. (2) For the purposes of this Act, an eligible young person is taken to be wholly dependent on a member if:
90.(a) either:
a. (i) the young person lives with the member; or
b. (ii) the Commission is of the opinion that the young person would be living with the member but for a temporary absence of the member or young person or but for an absence of the member or young person due to illness or infirmity; or
91.(b) the member is liable to provide child support under the Child Support (Assessment) Act 1989 for the young person.
92.Note: This subsection also applies to former members (see section 20).
What is obvious from those sections and from the assessment that has actually arisen in relation to this matter, is that the respondent's three children of her prior relationship fall within the definition of a dependant and/or eligible young person and it is for that reason that the additional payments were made to the applicant in these proceedings.
The additional payments as noted were calculated upon the increased entitlement which is now $81,367 for each child, dependant or eligible young person and this led to the further payment being received by the applicant on 9 April 2014 of $406,837.
What is argued from the perspective of the respondent is that the amount received by the applicant was made up of an amount in the vicinity of $243,000, as a result of the assessment of her children being dependants or eligible young persons.
The major argument as I indicated therefore was whether or not the amount received in relation to the compensation proceedings were a contribution by the applicant, a contribution by the respondent, or a joint contribution.
Certainly, in submissions that were made on the part of the respondent, it was contended that at the very least, some consideration should be given to the amount of approximately $240,000, being equally seen as a contribution by each of the parties and therefore if you like, a further contribution by the respondent to the matrimonial pool of $120,000.
It is necessary in this matter to specifically address that issue in relation to the proceedings so as to be able to move forward with the actual assessment of what might or might not be a just and equitable resolution of property between the parties. The writings of the learned authors of the Australian Family Law & Practice Handbooks, at paragraph 37-080, under the heading, “Damages awards”, refer specifically to the assessment or calculation of damages and how they might be seen as forming either a contribution by one party or the other to the matrimonial pool which is the subject of the determination.
At paragraph 37-080, the following is said:
93. If a party receives a damages award (for instance, as a result of a personal injury) and contributes the damages award towards an asset of the parties, the court has examined whether the other party can claim a contribution to the damages award. The wife in James and James (1984) FLC 91-537 claimed that her contributions to household expenses and earnings enabled the husband to continue his common law damages claim. This argument was rejected.
It is noteworthy that thereafter there have been extensive writings and consideration of the issue of damages and claims. In particular, I am aware of the judgment of Federal Magistrate Brewster, as he then was, in Kostov & Kuslev [2008] FMCAfam 757 where, at paragraph 18, his Honour said the following:
94. “The first thing to be observed is that the husband's damages award is a contribution made by the husband and by the husband alone. In her written submissions counsel for the wife pointed out that the settlement would in all probability have included an amount under the principles in Griffiths v Kerkemeyer. She contended that therefore a part of the damages were referable to contributions made by the wife. By way of explanation to the parties, and to any non‑lawyer who may read this judgment, I will explain what this means. If a person in the position of the husband suffers injury, and is unable to care for himself, and if a person in the position of the wife provides care for him, then the husband would be entitled to recover damages referrable to the gratuitous care that has been provided by the wife. This is called a Griffiths v Kerkemeyer award after the High Court case which definitively established this principle. However the submissions made on behalf of the wife have three major problems. The first is that there is no evidence that a claim was made for damages under this head. The file of the solicitors who acted for the husband was not in evidence. The second is that even if it were apparent that such a claim was made there is no evidence as to the portion of the settlement that might relate to such a claim. The third is that in any event this aspect of the case is irrelevant as the whole of a damages award, however comprised, is a contribution by the husband alone. See Wrona (Finn J, unreported, 17 December 2004)”.
It is a definitive statement of the position in relation to this matter and whilst I without hesitation acknowledge that the respondent has provided support to the applicant, there is no suggestion other than that the amounts received by the applicant by way of compensation arose entirely as a result of the injury sustained by him at work and are at law a contribution by the applicant.
It is important that that be recognised in relation to the determination of this matter, though it is also obviously important to acknowledge that in assessing what might be the matrimonial pool, the issue of contribution will have some greater import from the perspective of the respondent as a result of the non-financial contribution made by her during the relationship.
Having made those comments in relation to the issues with regard to this matter and the findings regarding the compensation payments, it is necessary then to consider the law in respect of de facto property to be applied.
THE LAW:
It is perhaps unnecessary for me to consider at any length the issue of whether or not a de facto relationship exists. The parties acknowledge that there is a de facto relationship and that the court has jurisdiction. It is necessary, however, to make a specific finding as to whether there is or is not a de facto relationship and in that regard I am mindful of the provisions of section 4AA of the Family Law Act. The section headed “De facto relationships” includes sub-sections which are titled “Meaning of de facto relationship” and, perhaps more circumstantial in most instances, “Working out if persons have a relationship as a couple”. Section 4AA is in these terms:
95.Meaning of de facto relationship
96.4AA(1) A person is in a de facto relationship with another person if:
(a)the persons are not legally married to each other; and
(b)the persons are not related by family (see subsection (6)); and
(c)having regard to all the circumstances of their relationship, they have a relationship as a couple living together on a genuine domestic basis.
Paragraph (c) has effect subject to subsection (5).
97.Working out if persons have a relationship as a couple
98.4AA(2) Those circumstances may include any or all of the following:
(a) the duration of the relationship;
(b) the nature and extent of their common residence;
(c) whether a sexual relationship exists;
(d)the degree of financial dependence or interdependence, and any arrangements for financial support, between them;
(e) the ownership, use and acquisition of their property;
(f) the degree of mutual commitment to a shared life;
(g)whether the relationship is or was registered under a prescribed law of a State or Territory as a prescribed kind of relationship;
(h) the care and support of children;
(i) the reputation and public aspects of the relationship.
4AA(3) No particular finding in relation to any circumstance is to be regarded as necessary in deciding whether the persons have a de facto relationship.
4AA(4) A court determining whether a de facto relationship exists is entitled to have regard to such matters, and to attach such weight to any matter, as may seem appropriate to the court in the circumstances of the case.
4AA(5)For the purposes of this Act:
(a)a de facto relationship can exist between 2 persons of different sexes and between 2 persons of the same sex; and
(b)a de facto relationship can exist even if one of the persons is legally married to someone else or in another de facto relationship.
When 2 persons are related by family
4AA(6) For the purposes of subsection (1), 2 persons are related by family if:
(a)one is the child (including an adopted child) of the other; or
(b)one is another descendant of the other (even if the relationship between them is traced through an adoptive parent); or
(c)they have a parent in common (who may be an adoptive parent of either or both of them).
a. For this purpose, disregard whether an adoption is declared void or has ceased to have effect.
The circumstances that need to be included in any consideration of whether parties are in a relationship as a couple include those matters set out in section 4AA(2)(a) through (i) but in particular in this matter, subsections (a), (b), (c), (d), (e) and (f). It was not an issue that was contended by either party as in dispute and I am satisfied that when one looks at those various circumstances required to be considered that there is overwhelmingly available to the Court the opportunity to declare and I do make the appropriate declaration of this couple being in a de facto relationship.
I turn then to a consideration of the issues of law and its application in this matter. Section 79 of the Family Law Act defines the court’s powers in determining applications for property settlement with respect to a marriage. Subsection (2) of section 79 provides that:
The court shall not make an order under this section unless it is satisfied that in all the circumstances, it is just and equitable to make the order.
Section 79(4) sets out the matters the court must take into account when considering what orders should be made for the alteration of the interest of the parties in property. Those matters include:
(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 property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last-mentioned property, whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c) the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e)the matters referred to in subsection 75(2) so far as they are relevant; and
(f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
In relation to a de facto relationship, provisions in virtually identical terms are set out in section 90SM(3) and (4). They are in these terms:
99.(3) The court must not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
100.(4) In considering what order (if any) should be made under this section in property settlement proceedings, the court must take into account:
101. (a) the financial contribution made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:
102.(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
103.(ii) 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 de facto relationship or either of them; and
104. (b) the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:
105.(i) to the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or
(ii)otherwise in relation to any of that last‑mentioned property;
a. whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them; and
106. (c) the contribution made by a party to the de facto relationship to the welfare of the family constituted by the parties to the de facto relationship and any children of the de facto relationship, including any contribution made in the capacity of homemaker or parent; and
(d) the effect of any proposed order upon the earning capacity of either party to the de facto relationship; and
107. (e) the matters referred to in subsection 90SF(3) so far as they are relevant; and
(f) any other order made under this Act affecting a party to the de facto relationship or a child of the de facto relationship; and
(g) any child support under the Child Support (Assessment) Act 1989 that a party to the de facto relationship has provided, is to provide, or might be liable to provide in the future, for a child of the de facto relationship
The approach to the determination of an application under section 79 or section 90SM is well-established by authority (see, for example Pastrikos and Pastrikos (1980) FLC 91-987, In the Marriage ofLee Steere (1985) FLC 91-626, In the Marriage of Ferraro (1993) FLC 92-335, In the Marriage ofClauson (1995) FLC 92-595, and In the marriage of Whitely (1996) FLC 92-684). The process ordinarily involves a multiple part procedure.
The court must first identify the assets, liabilities and financial resources of the parties and attribute a value to all assets usually at the time of the hearing. Thereafter it must evaluate the contributions made by each of the parties as defined in section 79(4)(a) to (c) or section 90SM(4)(a) to (c). Finally, the court must consider the financial resources, means and needs of the parties and other matters set out in section 75(2) or section 90SF(3) in so far as they are relevant.
An adjustment of the amount due to each party by way of contribution is then made by reference to the section 75(2) and section 90SF(3) factors. It is not essential, however, that such an adjustment be made. Generally speaking, an adjustment is made because one party has greater needs and the other has stronger means. Section 75(2) and section 90SF(3) is concerned with the process of arriving at a just and equitable result.
In determining what order the court should make under section 79 or section 90SM, the court must be satisfied in all the circumstances of the case that the order to be made is just and equitable, not simply that the underlying percentage division of the net value of the parties is appropriate. In other words, in consideration of whether the overall result of the order in the property settlement proceeding is just and equitable (see section 79(2) and section 90SF(3)), it is the justice and equity of the actual orders that the court must consider (Russell v Russell (1999) FLC 92-877).
The High Court’s decision in Stanford v Stanford [2012] HCA 52; (2012) 47 FamLR 481 has now modified that approach. In Erdem & Ozsoy [2012] FMCAfam 1323 (5 December 2012) Walters FM, as he then was, said of the majority decision in Stanford:
108. 116. It is arguable that the effect of the High Court's decision in Stanford is that the first step in the property settlement exercise is to identify, according to ordinary common law and equitable principles, the existing legal and equitable interests of the parties in their property. The second step involves ascertaining whether it is just and equitable to make an order altering the interests of the parties in their property. In most cases – relevantly, where the parties have separated and are no longer living in a marital relationship – the underlying assumptions that the parties had to the effect that the existing property ownership arrangements were functional (or perhaps irrelevant) and could be varied by agreement between them, no longer apply. That fact alone should ordinarily persuade the Court that it is just and equitable to make orders altering the parties' interests in their property. It is only after the Court has concluded that it is just and equitable to make such orders that it should proceed to take what might be regarded as the third and fourth steps – namely:
109. a) assess the extent of each party’s contributions under the various sub-headings described in section 79(4); and
110. b) thereafter, consider the financial resources, means and needs of the parties and the other matters set out in section 75(2) so far as they are relevant,
111. and in the process adjust the amount due to each party by way of contribution by reference to the relevant section 75(2) factors.
In Hobbs & Valonz [2013] FCCA 1999 Judge Cassidy adopted the approach set out by Mr Martin Barfeld QC of the Victorian Bar in his paper “Stanford and Stanford Lots of Questions – Very Few Answers”. The paper suggests the following approach which was adopted by Judge Cassidy:
112. “It can be now said after Bateman v Bowe that the approach is still one involving steps, albeit not to be followed ‘unthinkingly’. These appear to be:
o Declare and value the interest (both legal and equitable) of each party in property:
o Determine whether circumstances exist to make an order adjusting those interests and explain that circumstances. If the answer is yes (as it usually will be);
§ Evaluate and fix contribution;
§ Apply the s.75(2) factors;
o Formulate an order justified to give effect to the production of the evaluation.”
In Stanford, the majority explained in respect of whether it would be just and equitable to make an order would often be dealt with as follows:
113. In many cases where an application is made for a property settlement order, the just and equitable requirement is readily satisfied by observing that, as the result of the choice made by one or both of the parties, the husband and wife are no longer living in a marital relationship. It will be just and equitable to make a property settlement order in such a case because there is not and will not thereafter be the common use of property by the husband and wife. No less importantly, the express and implicit assumptions that underpinned the existing property arrangements have been brought to an end by the voluntary severance of the mutuality of the marital relationship. That is, any express or implicit assumption that the parties may have made to the effect that existing arrangements of marital property interests were sufficient or appropriate during the continuance of their marital relationship is brought to an end with the end of the marital relationship. And the assumption that any adjustment to those interests could be effected consensually as needed or desired is also brought to an end. Hence it will be just and equitable that the court make a property settlement order. What order, if any, should then be made is determined by applying section 79(4).
DISCUSSION:
It is necessary then to firstly address the issues that arise with regard to whether it is, in all the circumstances, just and equitable to make a determination in relation to this matter. In that respect, I note the previous comments of other judges in relation to the various considerations to be looked at and with respect perhaps need say little more than that the relationship between the applicant and the respondent in these proceedings has irretrievably broken down. Without in any way meaning to sound callous or harsh, it is unfortunately clear that as a result of the physical and psychological injuries that have been sustained by the applicant including the ongoing effect of an acquired brain injury, he is simply not the man that commenced the relationship with the respondent in these proceedings.
It is clear, for example, that there have been changes in his personality and demeanour which have led to aggressive behaviours, the obtaining by the respondent of domestic violence orders and of two circumstances which have given rise to breaches. There are also clearly other issues of concern with regard to the applicant including his suicidal behaviours and two attempts at least in relation to the taking of his life. It is clear that what might have previously existed between the applicant and the respondent is no longer able to in any way be considered as continuing.
In that respect, I am therefore satisfied that it is just and equitable that there should be a resolution of the property matters of the parties.
The second step then is to consider the assets of the parties. In that respect there is agreement as to what constitutes the assets of the parties and it is detailed in the agreed facts which have been handed to the court. I include herewith the non‑superannuation assets and liabilities as well as the superannuation assets and the combined pools for the purposes of noting what constitutes the pool for distribution.
AGREED Assets Pools
The Non-superannuation Assets Pool
NON SUPERANNUATION ASSETS Owner Agreed value Property C Joint $540,000 Property M Joint $312,500 (omitted) Mazda Respondent $12,000 (omitted) Bank account (No (omitted)) Joint Nominal (omitted) Bank cheque (No (omitted)) Applicant Nominal (omitted) Bank saver account (No (omitted) Applicant Nominal (omitted) Bank (omitted) Respondent $3,000 (omitted) Bank account ((omitted)) Respondent $1,000 Household contents Applicant $10,000 Household contents Respondent $10,000 Sub total $888,500 LIABILITIES (omitted) Bank offset loan (No (omitted)) Property M Joint ($269,000) (omitted) Mastercard (No ending (omitted)) Applicant Nominal (omitted) Visa (No ending (omitted)) at separation Applicant ($8,256) (omitted) Visa (No ending (omitted)) at separation Respondent ($2,500) (omitted) card at separation Respondent ($9,000) Sub total ($288,756) Total Nett Non superannuation Assets $599,744 The Superannuation Assets Pool
Applicant 3 superannuation accounts $88,500 Respondent’s superannuation $271,895 Total $88,500 $271,895 TOTAL Superannuation $360,395 Combined Pools
Non superannuation assets $599,744 Superannuation assets $360,395 GRAND TOTAL $960,139
The next step is to consider the contributions of the parties. Again there appears generally to be agreement as to what each party contributed financially to the relationship, during the period of two years and one month's cohabitation. At point (20) of the agreed facts, it was noted that the respondent's total contribution made up of carer's allowance and primarily income from her current employment, totalled $91,506 and that the contribution by the applicant made up of rental income from a property he owned prior to cohabitation at Property W, as well as various other payments received from (omitted) Super or the (employer omitted), totalled $149,178.
I would not necessarily consider that there should be any mathematical adjustments made as a result of the financial contributions of each of the parties. There are two obvious reasons for me saying that. The first is that whilst each contributed financially to the extent that they were able to do there needs to be recognised that whilst each worked to the best of their ability or received entitlements which arose as a result of prior employment they were simply paid at different levels and it would be highly inappropriate in a matter such as this to draw a financial distinction between the contributions of the parties.
In any event, there needs to be recognised as is properly acknowledged, that the income of the respondent was reduced by an amount of approximately $10,000, as a result of her taking reduced work time so as to ensure that she was able to provide assistance to the applicant particularly with regard to ensuring his ability to attend at doctors and other therapeutic attendances as were required as a result of his workplace injury.
It was also necessary to consider the differing non‑financial contributions that would have been made during the period of cohabitation. Again, there is very clearly evidence of a far more significant contribution being made in a non-financial respect by the respondent as a result of the limitations arising from the injuries sustained by the applicant. All in all, I am certainly satisfied that there is an equal contribution in respect of income and provision of support during the relationship.
It needs also, however, to be recognised that in a period of about nine weeks, from 3 February 2014 until 9 April 2014, the applicant received payments in relation to his injuries of approximately $785,000. As determined they are clearly moneys that are a contribution made by the applicant to the matrimonial pool.
In that respect, therefore, as detailed in the outline provided on the part of the applicant the contributions in totality by each of the parties were significantly different. As set out in Table G to the case outline provided by the applicant, it is suggested that the total contribution, both at the commencement of cohabitation and during cohabitation was $975,122 by the applicant and $220,506 by the respondent. The percentage calculation it is suggested with regard to the financial contributions of the parties, therefore, is 81.6 per cent by the applicant and 18.4 per cent by the respondent.
As I have indicated a purely mathematical calculation, however, fails to take into consideration other matters which are relevant in relation to the proceedings. In particular there is the non-financial contribution by the respondent and it is properly acknowledged that the non-financial contribution by the respondent which gave rise in part to a reduction in her financial contribution because of a reduction in the hours that she could work has not been taken into consideration. And whilst the proposal by the applicant is that a figure of 20 per cent be utilised for the formulaic calculation of entitlements it does not in my assessment, fully appreciate the non-financial contributions by the respondent or specifically issues with regard to the dissipation of at least some part of the moneys that were received during the relationship.
Quite simply, it is necessary to note that whilst approximately $1.2 million was received into the relationship during the period of two years and one month that they cohabited the actual assets of the parties exclusive of superannuation totals $888,500 and after deduction of a number of liabilities, primarily being the mortgage attaching to the Property C property, there are total non‑superannuation assets of approximately $600,000.
Whilst it is clear that some of the income and moneys received into the relationship during the period of cohabitation were utilised for day‑to‑day living expenses, it is necessary to recognise that a very significant amount perhaps $500,000 or thereabouts is not reflected in the asset pool of the parties. That is an important consideration here and as was emphasised by the legal representatives for the respondent is at least in part attributable to the fact that when the applicant received on 3 February 2014, an amount in excess of $378,000, 10 days later he paid $200,000 to the (omitted) Bank to discharge the mortgage that was then in existence over his Property W property.
That property was then retained and produced some other income which was received during the relationship but after separation the property was sold by the applicant and on 1 April 2015, the applicant received from the sale of the Property W property an amount of $191,007.
Those moneys were utilised entirely by the applicant. Some of the moneys were provided for the payment of a lump sum child support payment in relation to the applicant's two biological children, as well as unfortunately, the dissipation of at least $65,000, though the respondent suspects more by way of gambling in a month on an online gambling site. Otherwise, the moneys which were received and there must have been at least another $60,000 to $70,000 available to the applicant has been dissipated and is no longer available for distribution between the parties.
The point made by the respondent is a strong one. The contributions of the applicant during the relationship included that $200,000 but it did not in any way lead to the accumulation of further assets on the part of the parties jointly but was rather utilised entirely by the applicant. It gives rise to a need for a reconsideration of what might properly constitute the contributions of the parties and if there is to be some consideration of a calculation upon a percentage basis then there is obviously the need to address the dissipation of the proceeds received from the sale of Property W by the applicant.
In that respect, if as suggested the total contribution made by the applicant during the relationship is approximately $975,000 but that $200,000 has been utilised in some proportion appropriately and in others less than properly but entirely for his own purposes, then a more appropriate consideration of contributions of a directly financial nature would be a percentage closer to 77.5% to 22.5%. As I have indicated previously however, such a mathematical calculation does not take into consideration the reduced income earning capacity of the respondent as a result of limitations in her availability for work as a result of providing care and assistance for the applicant.
The assessment of contribution is obviously more difficult where the relationship is short in time and one party has made a far greater financial contribution than the other party. In this matter however, there is the additional consideration which has reduced the respondent incomes earning capacity and her additional non-financial contribution as a result of her meeting the needs of the applicant. Other considerations might also include whether the applicant through his greater financial contribution has contributed to the support of the respondents children but as noted earlier, there is at this time irreconcilable differences between the parties in relation to such issues.
Ultimately I have come to the view that the purely mathematical assessment does not reflect the entirety of the contributions, financial and non-financial and that an appropriate percentage reflective of all such issues is 70% to the applicant and 30% to the respondent.
Next it is necessary to consider that prospective element of any assessment reflected in the section 90SF(3) factors. In this matter that is a consideration which weighs heavily in favour of the applicant. It is clear that he has no future employment prospects as is obvious from the circumstances that arose in the days and weeks preceding the hearing of this matter. The applicant’s health both physical and psychological has been dramatically affected as a result of the accident which occurred on (omitted) 2012.
Not only does that seriously impact upon his future capacity to earn income but his state of health both physical and psychological is such that there will no doubt be extensive future requirements relating to medical treatment. I am not provided with any real evidence as to what might be the financial impact upon the applicant as a result of further issues with regard to his health but can opine that even with future entitlements to support there will be some calls upon whatever financial resources might remain under the applicants or his legal personal representative’s control.
Balanced against that is the fact that the respondent is apparently in good health, in secure employment and her prospects now and into the future mean that she has good opportunities to continue in appropriate, gainful and remunerative employment. The respondent also has children from a previous relationship and has obligations with regard to those children but B will shortly turn seventeen and the calls upon the respondent in respect of commitments there whilst not totally removed would be expected to reduce. The respondent does have continuing responsibilities in relation to C aged twelve but they do not appear to directly impinge upon her capacity for employment and therefore whilst there are obligations relating to the child and his maintenance they are not necessarily prohibitive of her future opportunities.
Again it is not entirely clear what might be the applicant’s future entitlements to support either by way of pension, allowance or benefit but even if such were available it would not be anticipated as being in any way equivalent to the respondent’s future opportunities.
It would normally be necessary to consider the duration of the de facto relationship and the extent to which that relationship may have affected the earning capacity of one or other of the parties. However, in this matter the de facto relationship is short and following the parties’ separation it has not to any real degree affected what would be anticipated in respect of the future circumstances of the parties. I say that in the sense that the applicant’s physical and psychological situation existed prior to the commencement of cohabitation though it may have deteriorated over time and the respondent has continued in the employment which she had prior to cohabitation commencing and every expectation is that it will continue into the future.
Clearly there may be other factors that arise in the future including improvement or deterioration in the applicant’s health as well as what might be the circumstances of the respondent with regard to any other relationship or more extended obligations in relation to the parenting and provision for her children. But to seek to include such considerations would be speculative in the extreme and any adjustment pursuant to section 90SF(3) can only properly be a reflection of the circumstances as they currently exist.
In that respect I am satisfied that there is a very real distinction between the future prospects of the applicant and of the respondent and in the circumstances consider that an adjustment of 5% in favour of the applicant would be appropriate. That would then relate to an ultimate determination of 75% in favour of the applicant and 25% in favour of the respondent.
The orders that have been proposed on the part of the applicant and it would seem accepted by the respondent are formulaic but reflect a means by which a calculation can be done so as to facilitate a figure which will reflect an appropriate, just and equitable distribution of property as between the parties. Accordingly, the orders of the court adopting a percentage entitlement of 25% exclusive of superannuation entitlements and other motor vehicles, bank accounts and chattel items in the possession of the respondent are detailed at the commencement of these reasons.
I certify that the preceding eighty-two (82) paragraphs are a true copy of the reasons for judgment of Judge Coker
Date: 2 June 2016
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