Noetel & Quealey

This matter concerned an appeal regarding the division of property, specifically focusing on the treatment of potential capital gains tax (CGT) liabilities. The husband argued that the trial judge erred by failing to account for CGT implications when making property orders, while the wife contended that the husband had failed to adduce sufficient admissible evidence to support such considerations.

The central legal issues before the court were whether the husband's prior evidence, including probate statements and market appraisals, was admissible to establish potential CGT liabilities, and if so, how those liabilities should be factored into the property settlement under sections 79 and 75(2) of the relevant legislation. The court was required to determine the onus of proof for demonstrating CGT liabilities and whether the trial judge was entitled to speculate on the timing and quantum of such taxes in the absence of clear evidence.

The court considered the admissibility of the husband's evidence under sections 77 and 190 of the Evidence Act 1995 (Cth), as well as section 69. It was argued that the husband's failure to present admissible evidence regarding the quantum of CGT meant the trial judge could not make assumptions about its impact. The wife maintained that the husband had rejected a proposal to sell the inherited properties and had not demonstrated an intention or need to sell other investment properties, thus crystallising a CGT liability. Consequently, the wife argued there was no basis for the court to consider potential CGT liabilities.

The court ultimately found that the husband had not discharged the onus of proving the admissibility and quantum of potential CGT liabilities. The trial judge was therefore not in a position to speculate on these matters when making property orders. The appeal on this ground was dismissed.