NESBITT & ALABASTER
[2012] FMCAfam 891
•10 August 2012
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| NESBITT & ALABASTER | [2012] FMCAfam 891 |
| FAMILY LAW – s.90SM(1) property application – parties divorced and later reconciled but did not remarry – Orders made for the benefit of the children. |
| Family Law Act 1975, ss.90SF(3), 90SM(1), 90SK, 90SB |
| Applicant: | MS NESBITT |
| Respondent: | MR ALABASTER |
| File Number: | MLC 12010 of 2010 |
| Judgment of: | Whelan FM |
| Hearing dates: | 9 and 10 August 2012 |
| Date of Last Submission: | 10 August 2012 |
| Delivered at: | Melbourne |
| Delivered on: | 10 August 2012 |
REPRESENTATION
| Counsel for the Applicant: | Mr Cooper |
| Solicitors for the Applicant: | Randles and Cooper |
| Counsel for the Respondent: | In person |
ORDERS
That the Respondent transfer to the Applicant all of his interest in the property known as and situate at Property M, in the State of Victoria (“the real property”).
That the Applicant hold 36.5% of the total interest in the real property on trust for the three children of the relationship, X born (omitted) 1994, Y born (omitted) 1998 and Z born (omitted) 2007, in equal shares, to vest when the youngest child reaches the age of 18 years, or on the death of the Applicant, should that occur before the youngest child attains the age of 18 years.
That the Applicant is restrained from selling or encumbering the real property, prior to it vesting, without the express consent of the Respondent or an Order of the Court.
That the Respondent retain the Toyota motor vehicle, registration number (omitted).
That upon the Applicant providing procedural fairness to the Trustee of the (omitted) Fund, a splitting Order issue in favour of the Applicant.
That paragraphs 6 to 12 (inclusive) of these Orders are binding on the Trustee of the (omitted) Fund (“the Fund'').
That the base amount of $30,000.00 be allocated to the Applicant out of the Respondent’s interest in the Fund.
That pursuant to s.90MT(1)(a) of the Family Law Act 1975 (“the Act”) whenever a splittable payment becomes payable in respect of the Respondent’s interest in the Fund, the Applicant shall be entitled to be paid an amount calculated in accordance with Pt 6 of the Family Law (Superannuation) Regulations 2001 (“the Regulations”) using the base amount and there be a corresponding reduction in the entitlement of the person to whom the splittable payment would have been made but for these Orders.
That Order 8 has effect from the operative time.
That the operative time for the purpose of paragraphs 8 and 9 of these Orders is four (4) business days after the date of service of these Orders upon the Trustee of the Fund. The date of service to be taken to be after procedural fairness has been afforded to the Trustee of the Fund.
That until such time as the Superannuation split to the Applicant pursuant to these Orders can be rolled over into a separate account to the Applicant:
(a)The Respondent shall provide to the Applicant no less than twenty-eight (28) days notice before such time as he elects to retire from and/or take voluntary retirement and/or for any reason accept or become entitled to access in whole or in part his entitlement in the Fund;
(b)The Respondent shall direct and authorise the Trustee of the Fund to communicate with the Applicant and/or any person authorised by the Applicant in writing:
(i)To answer any reasonable inquiries as may be made by her or on her behalf from time to time in relation to her entitlement in the Fund; and
(ii)To provide to the Applicant and/or her authorised representative a copy of any notice of any application or request by the Applicant which seeks release of entitlements in the Fund in so far as that release may effect the entitlement in the Fund pursuant to these Orders; and
(c)The Respondent by himself, his servants and/or agents be and hereby are restrained from doing any act or thing which would prevent the Applicant, her heirs, executors, administrators or nominees from receiving the benefits in the Fund to which she is entitled pursuant to these Orders.
That in the event that the Superannuation split to the Applicant pursuant to these Orders can be rolled over into a separate account to the Applicant each of the parties hereto shall each do all such acts and things and execute all such documents as may be necessary to facilitate and to implement that rollover.
That the Respondent transfer to the Applicant all his interest in the funds held by the (omitted), for use by the Applicant for the sole purpose of meeting the educational expenses of the children.
That unless otherwise specified in these orders and save for the purposes of enforcing any monies due under these or any subsequent orders:
(a)Each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders (the furniture, personal possessions, and like chattels being deemed to be in the possession of the Applicant/Respondent).
(b)Monies standing to the credit of the parties in any joint bank account are to be divided equally between the parties.
(c)Each party forgo any claims they may have to any superannuation benefits belonging to or earned by the other.
(d)Insurance policies remain the sole property of the owner/beneficiary named thereon/in.
(e)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.
(f)Any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
All extant Applications be otherwise dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Nesbitt & Alabaster is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
MLC 12010 of 2010
| MS NESBITT |
Applicant
And
| MR ALABASTER |
Respondent
REASONS FOR JUDGMENT
(Revised from transcript)
This judgment deals only with the property issues in this matter, the parties having reached consent orders on parenting issues.
I have given considerable thought to what might be the appropriate way to deal with this matter, and I acknowledge that the parties have been able to reach an agreement in relation to the parenting issues. In my view it is of benefit to both the children and the parties that they have been able to do that. I also acknowledge in determining a resolution of the property issues, that both parents are strongly committed to the children and wish to do what is best for them, and those are matters that have exercised my mind in coming to this decision.
This is a property application by MS NESBITT (“the Applicant”) in which she seeks an adjustment of the parties’ property interests which would give her 75 per cent of the property along with other associated orders. The Respondent, MR ALABASTER (“the Respondent”), sought orders that would enable him to retain ownership of the house, which is the most substantial asset, until the youngest child, now aged five, attains the age of 18 years. Otherwise, he sought the house be sold and the Applicant receive 55 per cent of the property pool.
Background
It is necessary to go a little into the background before I come to the issues that the Court needs to determine. The Applicant was born in (omitted) 1966, so she is now 46 years of age, and the Respondent was born in (omitted) 1966, and so is also 46 years of age. They married in (omitted) on (omitted) 1990 and had one child, X (“X”), who is now 18, before relocating to New Zealand in 1996.
Their second child, Y (“Y”), was born in (omitted) 1998, and the parties then relocated to Australia in 2000. On 18 October 2002, the parties were divorced, but later reconciled in November of 2003. During the period of separation, the Respondent purchased a property in Property S, (“Property S property”) and also a property in Property B, (“the Property B property”). The Applicant purchased a property in Property D (“the Property D property”). At the time of the reconciliation, the Applicant and children moved into the Property S property with the Respondent. The parties then jointly purchased a property in Property A, (“the Property A property”), in July 2004, and the Respondent sold both the Property S property and the Property B property later that year.
In 2004, the parties sold the Property A property. In July 2007, the child Z (“Z”) was born. In (omitted) 2009, the parties jointly purchased a property at Property M, (“the Property M property”), and the Applicant sold the Property D property. The parties separated on a final basis in 2010. While the parties reconciled in November 2003, they did not remarry in accordance with Australian law. The provisions of Part VIIIAB, Division 2, Subdivision C of the Family Law Act 1975 (“the Act”), therefore, apply to these proceedings.
The parties
The Applicant currently resides in the Property M property with the three children. She completed a (course omitted) at (omitted) University, but has not worked in that field in Australia. After moving to Victoria in 2001, she was employed as a (occupation omitted), but has not been in paid employment since 2006. A major conflict in her relationship with the Respondent was his commitment to support his extended family, which she saw as being to the detriment of their immediate family.
The Respondent currently resides in rented accommodation in (omitted), close to the Applicant, the children’s school and the (omitted). He lives with his second wife and their child. He completed a (course omitted) at the University of (omitted). He completed a (course omitted) in (omitted) and a (course omitted) while living in New Zealand. After moving to Australia, he became registered as a (occupation omitted), and has worked in various positions in Victoria and New South Wales. He is continuing to study and currently has certain restrictions on his capacity to engage in private practice. While his income varies, he was last assessed for the purposes of child support payments as having an income of $118,000.00 per annum. He described himself as “more spiritual than materialistic”.
The assets
I now turn to the question of the assets. The parties have agreed that the asset pool for the purpose of these proceedings consists of the following:
i)the Property M property, which has a sworn valuation of $390,000.00;
ii)the Respondent’s Toyota motor vehicle, valued at $23,000.00;
iii)the (omitted) Fund with a value of $19,000.00; and
iv)the parties have superannuation, being the Respondent’s interest in the (omitted) Fund of $72,000.00 and the Applicant’s interest in (omitted) Super of $12,000.00.
There are no liabilities.
The total asset pool, apart from the scholarship fund, which I will deal with later, is therefore $413,000.00 in property and $84,000.00 in superannuation.
Contributions
I now turn to the issue of contributions. The parties have had a long relationship, albeit that there have been periods of separation and they were divorced in October 2002. While they reconciled in November 2003, there were periods of time after that date when the Applicant lived in Melbourne with the children and the Respondent worked in country Victoria, only spending time with the family at the weekend.
The Respondent claims that he has made the greater financial contribution to the assets of the parties, and given that the Applicant has not worked since 2006, his contribution since that date would appear to exceed hers. He does concede, however, that the Applicant made a greater contribution as a homemaker and in the care of the children, particularly as he was both working and studying.
For the purposes of these proceedings, I consider it to be appropriate to value the contributions of the parties to the acquisition, conservation and improvement of the property, and to the welfare of the family, as being equal overall.
Section 90SF(3) factors
I now turn to the factors under section 90SF(3). Both the Applicant and the Respondent are in their mid-40s and they are both healthy.
The Respondent clearly has a greater income than the Applicant, and I accept that he will continue to have a greater earning capacity than she will. I do not accept, however, that the Applicant is unable to be employed. She is well-educated, although she says her qualifications are not recognised in Australia. Nevertheless, she has been gainfully employed here in the past and I’m sure will be in a position to obtain suitable employment when her youngest child starts school. She currently has the three children living with her, and while X is now 18 year old, she is still a student and dependent on her family. Y is in year 9 and Z is yet to start school. They are both dependent on her.
The Respondent has a wife and a small baby for whom he is also responsible. He is also paying child support for Y and Z.
Considerations
These are the considerations that I have taken into account in coming to my conclusion.
Both parties have put to the Court that the money in the (omitted) Fund should be used for the purpose for which it was intended, namely, the education of the children. I have therefore decided that the fund should be transferred to the Applicant’s name, on the basis that she will use that money for the sole purpose of paying expenses associated with the children’s education.
Both parties put to the Court that they wished to retain the Property M property. The Applicant proposes that the Respondent’s interest be transferred to her, and has indicated that she has the capacity to borrow money from friends and relatives to pay out the Respondent, based on her proposal that his interest be assessed at 25 per cent and she forego any claim on his superannuation.
The Respondent wishes to retain the house in his name. He gives as his reasons for this the fact that the house was purchased to provide a home for the children which was close to their school and the (omitted), and his concern that the Applicant, if the house was in her name, could sell the property and move away from the area.
The Applicant says that she wishes to retain the house in order to provide a home for the children which is close to their school and the (omitted), and because she would have difficulty in purchasing alternative accommodation should the house be sold.
Conclusions
The Property M property was purchased in 2009 because of its location. The parties wanted a home for the children, primarily, that was close to the school they wished them to attend and to the (omitted). The children have developed friendships in the area and are part of a wider community centred on their faith and their culture. Both parties want the children to have the benefits of that community and location. Unfortunately, due to the history of their relationships, the parties have little trust in each other. Both accuse the other, for example, of failing to disclose all of their financial resources.
I am satisfied that a just and equitable outcome in this matter would be for the property to be divided on the basis of 60 per cent to the Applicant and 40 per cent to the Respondent. On the basis of the Respondent retaining the Toyota motor vehicle, this would require a payment to the respondent of $142,200.00. Even should I reduce that amount to take into account the parties relative positions with respect to superannuation, such an amount would require substantial borrowings by the Applicant.
An alternative would be to order that the house be sold, but that solution would not ensure that the Applicant and the children were able to remain living in the area. I flagged with the parties during the course of the proceedings an alternative, whereby the Respondent’s interest in the property was to be held in trust for the benefit of the children. Although this appeared consistent with a proposal put by the Respondent in his Affidavit of 9 August, 2012, it was not followed up by the parties.
The provisions of s.90SM(1) give the Court wide powers in dealing with the property interests of parties to de facto relationships. Provided that the requirements of s.90SK are satisfied – in this case the parties have lived in Victoria during the relevant material times – and the requirements of s.90SB – in this case, the relationship exceeded two years and the child Z was born during the relevant time – the Court has the capacity to do as follows:
Section 90SM(1)
In property settlement proceedings after the breakdown of a de facto relationship, the court may make such order as it considers appropriate:
(a) in the case of proceedings with respect to the property of the parties to the de facto relationship or either of them - altering the interests of the parties to the de facto relationship in the property; or …
including:
(c) an order for settlement of property in substitution for any interest in the property; and
(d) an order requiring:
(i) either or both parties to the de facto relationship; …
to make, for the benefit of either of both of the parties to the de facto relationship or a child of the de facto relationship, such settlement or transfer of property as the court determines.
Taking into account all of the circumstances in this case, I have determined that a just and equitable resolution of this matter is as follows:
·That the Respondent transfers to the Applicant his interest in the Property M property.
·That the Applicant is to hold 36.5 per cent of the interest in that property on trust for the three children of the relationship, X, Y and Z, in equal shares, to vest when the youngest child reaches the age of 18 years or on the death of the Applicant, should that occur before the youngest child turns 18.
·That the Applicant is not to sell or otherwise encumber the Property M property prior to it vesting without the express consent of the Respondent or alternatively an order of the Court.
·The Respondent is to retain the Toyota motor vehicle.
·Upon the Applicant providing procedural fairness to the trustees of the (omitted) Fund, a splitting order will issue providing a base amount of $30,000.00 to be allocated to the Applicant out of the Respondent’s interest in that fund, and there will be further procedural orders in relation as to how that will occur.
·The Respondent is to transfer to the Applicant his interest in the (omitted) fund, which will be used by the Applicant for the sole purpose of meeting the educational expenses of the children.
That unless otherwise specified in these orders, and save for the purpose of enforcing any moneys due under these or any subsequent orders:
·Each party be solely entitled to the exclusion of the other to all other property (including choses-in-action) in the possession of such party as at the date of these orders (the furniture, personal possessions, and like chattels being deemed to be in the possession of the Applicant/Respondent).
·Monies standing to the credit of the parties in any joint bank account are to be divided equally between the parties.
·Each party forgo any claims they may have to any superannuation benefits belonging to or earned by the other.
·Insurance policies remain the sole property of the owner/beneficiary named thereon/in.
·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.
·Any joint tenancy of the parties in any real or personal estate is hereby expressly severed.
All extant applications are otherwise dismissed.
I certify that the preceding twenty-nine (29) paragraphs are a true copy of the reasons for judgment of Whelan FM
Date: 24 August 2012
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